Sitting of 3 April 1968

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  LONDON TRANSPORT BILL
  As amended, considered; to be read the Third time.
ORAL ANSWERS TO QUESTIONS
  AGRICULTURE, FISHERIES AND FOOD

    Farm Waste (Disposal)
    Mr. Brewisasked the Minister of Agriculture, Fisheries and Food what grants are available towards the cost of installations to purify and dispose of farm waste.
    The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. John Mackie): Installations for disposing of farm waste are eligible for agricultural investment grants or can qualify for grant under the Farm Improvement Scheme if they satisfy the tests of the Scheme.
    Mr. Brewis: Am I not right in thinking that a much higher grant, amounting to about 60 per cent., is paid to local authorities which undertake this sort of work? In view of the great cost of many of these schemes, will the hon. Gentleman consider including them in the drainage grant?
    Mr. Mackie: No, Sir. As far as we can see from the number of schemes before us, the grant seems to be sufficient to attract a lot of farmers to go in for it. But I shall look at the point which the hon. Gentleman has raised regarding the local authorities.

    Eggs
    Mr. Brewisasked the Minister of Agriculture, Fisheries and Food when he expects to receive the report of the Reorganisation Commission on the marketing of eggs.
    The Minister of Agriculture, Fisheries and Food (Mr. Fred Peart): As announced in the 1968 Annual Review White Paper, the Commission's report is expected to be completed during the spring.
    Mr. Brewis: When the right hon. Gentleman sees the report, will he bear in mind the need for orderly marketing for many agricultural areas such as Northern Ireland and the Orkneys, where there is a healthy industry at present which might be put in jeopardy?
    Mr. Peart: I am always aware of the need for orderly marketing, and I constantly stress it. But I must wait for the report.
    Mr. Biffenasked the Minister of Agriculture, Fisheries and Food if he will revoke the British Egg Marketing Board Scheme.
    Mr. Peart: The future of the Scheme will fall to be considered in the light of the report of the Reorganisation Commission.
    Mr. Biffen: While I appreciate the anxiety of the right hon. Gentleman to have that report before coming to any conclusion, may I ask him to bear in mind the advantages that would accrue to the taxpayer and the consumer, as well as to agriculture, if egg marketing in future were left to free enterprise and not constrained in some way, to keep in being high-cost producers?
    Mr. Peart: I am aware that on this question there are many conflicting interests. One of the hon. Gentleman's hon. Friends said earlier that he wanted more orderly marketing. I must be sensible here and wait for the report.
    Mrs. Joyce Butlerasked the Minister of Agriculture, Fisheries and Food if the Reorganisation Commission on the egg industry will include recommendations on the sale of free-range eggs when it makes its report.
    Mr. Peart: The terms of reference of the Reorganisation Commission cover all aspects of the marketing of eggs. I cannot anticipate its report.
    Mrs. Butler: In view of the increasing demand for free-range eggs labelled as such, would my right hon. Friend ensure that provision is made for them to be marketed in this way when he receives the report?
    Mr. Peart: I cannot anticipate the Commission's report at this stage.
    Mr. Scott-Hopkins: When does the Minister expect to receive the report? Would he confirm that the nutritional value of free-range eggs is no more than that of eggs laid by battery hens or deep-litter eggs?
    Mr. Peart: I cannot give a precise date for when I shall receive the report. I answered a previous Question on this matter.

    Transport Bill
    Mr. Loveysasked the Minister of Agriculture, Fisheries and Food (1) what estimates he has made of the total increase in costs to the horticultural industry of the present proposals in the Transport Bill;
    (2) what estimates he has made of the total increase in costs to the agricultural industry of the present proposals in the Transport Bill.
    Mr. Martenasked the Minister of Agriculture, Fisheries and Food if he will make a statement on the estimated cost to agriculture of the Transport Bill.
    Mr. Wolrige-Gordonasked the Minister of Agriculture, Fisheries and Food why he is unable to make an estimate of the increase in costs to British agriculture consequent upon the passing into law of the Transport Bill this summer.
    Mr. Peart: The detailed proposals under the Transport Bill will be brought into effect by subordinate legislation. It is not possible to estimate the costs which may fall upon agriculture and horticulture when the proposals come into operation.
    Mr. Loveys: Does not the right hon. Gentleman agree that both these impor
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    tant industries, agriculture and horticulture, and every other important industry in the country, are justifiably concerned about the enormous extra cost to be caused by this Measure and the Budget Statement together? The Budget will cost agriculture and horticulture an extra £4 million or £5 million. In all honesty, will not the right hon. Gentleman agree that their only consolation is that the Conservative Party is pledged to repeal much of the Bill when it returns to power?
    Mr. Peart: It would not be proper for me to comment on the speech made by the hon. Gentleman. In reply to the first of his observations, I recognise that there are proposals which could affect the industry. Certain of these costs are matters which we always discuss at the Review.
    Mr. Marten: Why is it not possible to give the House an estimate of the rise in transport costs? What is the estimated percentage rise, for instance, in professional road hauliers' charges as a result of the Bill, and will not these extra costs mean a difference in the distribution pattern for food?
    Mr. Peart: It is impossible for anyone to estimate at present how these proposals will affect the industry. A good deal of the Bill will be effected by Regulations. I cannot say precisely, and I do not think that any individual could.
    Mr. Manuel: Is my right hon. Friend aware that there is much misleading information being put about by hon. Members opposite, from briefs supplied to them? Is he further aware that, if goods, horticultural goods or other goods, go over 100 miles from road to rail, the transport will be cheaper and, because it will be cheaper, the traffic will go?
    Mr. Peart: I am well aware of that. Obviously, there will be problems and difficulties, but my right hon. Friend the Minister of Transport and I will discuss any difficulties. Before detailed regulations are made, there will be consultations.
    Mr. David Steel: Does not the right hon. Gentleman appreciate that particular difficulties will arise in the carriage of livestock, and many of the rules outlined in the Transport Bill make nonsense in relation to the carriage of live animals?
    Mr. Peart: As I have said, my right hon. Friend and I will discuss any detailed regulations. We must bear this in mind. There will be consultations.
    Mr. Godber: Does not the right hon. Gentleman realise that his answers will give rise to a good deal of disquiet in the industry as they appear not to show the degree of concern for farmers' needs in this respect that one would expect? Will he discuss this whole matter again with his right hon. Friend? Further, will he say how many representations he has had from farming organisations against proposals in the Bill?
    Mr. Peart: I could not give that precisely. I recognise that the National Farmers' Union has views about it. I do not deny that. But, as I said, I shall discuss these matters with my right hon. Friend, and, as regulations are an important aspect of the Measure, I shall certainly keep in touch with her.
    Mr. Maclennan: Does my right hon. Friend agree that since the Government announced modifications to the Transport Bill in the Budget some of the more exaggerated fears expressed are now no longer justified, but would he bear in mind that there is still considerable concern about the operation of the regulations regarding drivers' hours, which are of particular importance in agriculture during the harvest season?
    Mr. Peart: I am aware of this. The question of drivers' hours and the practices which are accepted in the industry have been specifically raised with me, and, as I have said, I am in close consultation with my right hon. Friend.

    Net Farming Income
    Mr. Buchanan-Smithasked the Minister of Agriculture, Fisheries and Food what forecast he has made of the increase in net farming income adjusted to normal weather conditions for 1968–69.
    Mr. John Mackie: The forecast of net farming income for 1968–69 adjusted to normal weather conditions will not be available until next year.
    Mr. Buchanan-Smith: Does not the Minister realise that the £40 million award in the 1967 Price Review has ended up with an increase in farmers' incomes,
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    adjusted for weather, of only £13½ million? Does he expect farmers to absorb £16 million of costs under the present Review and at the same time to increase their income?
    Mr. Mackie: I do not see what that has to do with the Question. The farm income year starts on 1st June and does not finish until the end of the following May. We must look at prices, markets, weather and everything else before we can make that forecast.
    Mr. Hawkinsasked the Minister of Agriculture, Fisheries and Food when he expects to publish the revised series raised sample forecast for aggregate farming net income for 1967–68.
    Mr. John Mackie: The data for such an estimate is collected during the summer and my right hon. Friend will publish the result following the 1969 Annual Review.
    Mr. Hawkins: Does the Minister agree that this series, which is based on actual results, is nearer the truth than the Departmental estimate, and will he investigate why there is now a 25 per cent. difference between the two estimates?
    Mr. Mackie: The estimate about which the hon. Gentleman is speaking, the one done on the basis of data supplied by the universities, is based on a sample of 3,600 farms. The hon. Gentleman may not know that it does not include a great many horticultural and intensive pig and poultry units. It is a different figure, but the trend in this series is roughly the same, except in the past two years. The average end point of these results is in February and the other results are, as I explained to the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith), for the year ending 31st May. That explains the recent difference in trend, because last year there was a very good spring. Less feedingstuff was used and more milk was produced, and that made the big difference about which the hon. Gentleman is worried.
    Mr. Brewis: Does the Minister agree that farm income is not rising at the expected rate, and is tending to fall?
    Mr. Mackie: If the hon. Gentleman looks at the figures he will see that it is

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    rising fairly evenly all along. If he projected the three-year average he would see that there is a fairly straight run of a rise in incomes in agriculture.
    Mr. Godber: On that last answer, presumably the Joint Parliamentary Secretary rests his case on the so-called actual figure and not the raised sample, which is what the Question was on. If he takes the three-year sample on that, it is going downhill rapidly.
    Mr. Mackie: As I explained, the £410 million to £400 million of the revised series—[Interruption.]—I was coming to the £371 million. I explained this previously. The right hon. Gentleman did not listen, or did not want to listen to my Answer, because there are none so deaf as those who will not hear. The difference in trend was because of the high figure in the spring last year of milk returns and the low amount of feedingstuffs used. If the hon. Gentleman cares, I shall give him the actual figures and calculations and I think that he will find that I am right.
    Mr. Bryant Godman Irvineasked the Minister of Agriculture, Fisheries and Food what has been the real increase in farmers' net income since March, 1965, after allowing for personal taxation and changes in the index of retail prices.
    Mr. John Mackie: It is not possible to estimate the change in farmers' net income after tax since March, 1965, because details of the tax position of individual farmers are not available.
    Mr. Irvine: Is it not possible to give an indication of the income position? Surely the figures are fully available? The Government are always saying that increases in income should be the reward of corresponding increases in productivity. Since farming is a leader in increased productivity, should farmers not be leaders in getting increased incomes?
    Mr. Mackie: I do not see what that issue has to do with the Question on the Order Paper. The hon. Gentleman knows that individual Income Tax returns are private and that we do not have access to them.
    Sir A. V. Harvey: Have the Government taken into account the high rates
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    of interest paid by farmers on money they borrow—the highest on record? What is he going to do about it if he wants to expand agricultural policy?
    Mr. Mackie: Interest rates are taken into account in the Annual Price Review, as the hon. Gentleman knows.

    Selective Expansion Programme
    Mr. Buchanan-Smithasked the Minister of Agriculture, Fisheries and Food whether he will revise upwards the selective expansion programme to take account of the new situation created by devaluation.
    Mr. Martenasked the Minister of Agriculture, Fisheries and Food what fresh proposals he has for increasing home-produced food; and if he will make a statement.
    Mr. Peart: Agriculture's contribution to the national economy was considered very fully at the Annual Review along with other relevant considerations including the economic situation following devaluation. I have nothing to add to what is said in the Annual Review White Paper.
    Mr. Buchanan-Smith: Is the right hon. Gentleman aware of the Prime Minister's statement on 19th November that farm production would be stimulated and imports saved? What positive action have the Government taken to give farmers the proper incentive?
    Mr. Peart: This has been done not only by this year's Review, which I think was reasonable and sensible and will encourage expansion and investment. Taken with last year's Review, it aims to achieve the selective expansion programme. In that sense, it will be concerned with import saving.
    Mr. Marten: When the bacon agreement comes up for review, will the Minister seek a larger share of the bacon market for the British producer in order to save imports?
    Mr. Peart: This is something I must bear in mind. One of our difficulties previously has been to maintain our percentage. I have increased the guarantee for pigs and I introduced new proposals to help the industry which have been

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    accepted by it, so that altogether I want o make the industry much more viable, strengthened and expanded.
    Mr. Turton: Does the Minister appreciate that the proposals in the Review make no provision for the kind of import-saving programme the Prime Minister mentioned in November? Will he reconsider this matter in the light of the Prime Minister's undertaking?
    Mr. Peart: We are always considering this, and I am in close touch with the unions. I believe that the Review, which I am certain was recognised by all fair-minded people to be sensible and realistic, will help achieve the aims of the selective expansion programme.
    Mr. Prior: How can the Minister get his import saving without either taking some control over imports or incurring a vast increase in Government expenditure in the form of subsidies?
    Mr. Peart: The two pertinent questions of import saving and the nature of support for the industry are matters which we shall discuss this year. I hope that right hon. and hon. Members opposite will appreciate that we have many international obligations. I have challenged the right hon. Member for Grantham (Mr. Godber) so often. Is it the view of the Opposition that we should end all our trade with countries like New Zealand?
    Mr. Joplingasked the Minister of Agriculture, Fisheries and Food whether he will make a statement on the progress of the selective expansion programme.
    Mr. Peart: I have given an account of progress in the recent Annual Review White Paper.
    Mr. Jopling: Would not the right hon. Gentleman agree that if agriculture had the chance, it would be capable of doing much better than the selective expansion programme which the Government have laid down for it?
    Mr. Peart: I have already replied to that. My White Paper was categorical and I know that the hon. Gentleman has not really criticised it.
    Mr. Bryant Godman Irvineasked the Minister of Agriculture, Fisheries and Food what contribution agriculture has made to import saving in each Price Review year since the publication of the
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    selective expansion plan; and what contributions it is expected to make in the forthcoming year.
    Mr. Peart: It is not possible to give figures on a year-to-year basis in terms of actual imports saved, but the volume of home agricultural output has risen by about 5 per cent. overall over the period of the selective expansion programme compared with about ½per cent. for all food imports.
    Mr. Irvine: Is the right hon. Gentleman satisfied to leave imports at the level of £1,600 million a year without taking more urgent action than he is taking?
    Mr. Peart: I announced a long time ago and I have repeatedly told the Opposition that we have a selective expansion programme which aims to meet the increased demand for food of £200 million by 1971 and that the greater part of this demand will be met from home production. My last two Price Reviews, which have been successful, have been designed to achieve this.
    Sir J. Langford-Holt: The right hon. Gentleman spoke of a proposed increase in demand. Does he mean an increased percentage of those products which we can produce ourselves at home?
    Mr. Peart: I believe that we can produce a greater proportion. That is why I abolished standard quantities for wheat and raised cereal prices, for example. I should have thought that hon. Members opposite would have been cheering me today.
    Mr. Manuel: Will my right hon. Friend remember that many farmers face increased expenses because of bad marketing arrangements and steeply increased auctioneers' fees? Could he not make more sensible marketing arrangements and so do away with auctioneers and save money?
    Mr. Peart: I am aware of the importance of more orderly marketing arrangements and I am conducting inquiries into many commodities. The Egg Commission is one example.

    Home-Fed Beef Supplies
    Sir Clive Bossomasked the Minister of Agriculture, Fisheries and Food what are his estimates for home-fed beef supplies in 1968 and 1969.
    The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James Hoy): Home-fed beef and veal supplies in 1968 are expected to be a little below those in 1967. It is too early to give a similar indication for 1969.
    Sir Clive Bossom: When he is considering 1969, will the Minister consider doubling this year's target, because farmers are willing and able to produce more? Has he really taken into account devaluation, the serious loss due to foot-and-mouth disease and the heavy cost of imports?
    Mr. Hoy: I am sure the hon. Gentleman will agree that it is a little too early to be considering next year's Annual Price Review. Of course, we want to increase our own production and we have been giving thought to that.
    Sir W. Bromley-Davenport: How does the Minister expect to get a major and continuous expansion in production without introducing the levy system?
    Mr. Hoy: The levy system has been considered. It has been suggested by hon. Members opposite and many others. All that I am saying is that, whether we have one or not, we must seek to make British agriculture strong in its own right.

    Marshes, Walberswick (Flooding)
    Sir H. Harrisonasked the Minister of Agriculture, Fisheries and Food following the break-through of the North Sea into the marshes south of Walberswick, what action he is authorising the river board to take to prevent further loss of land.
    Mr. John Mackie: I understand that the river authority reinstated the sea bank the day after the recent flooding. It is for it to determine what capital works if any should be undertaken. If a scheme could be devised to protect these marshes which was both technically and economically sound, we would certainly consider it for grant aid.
    Sir H. Harrison: That Answer is very disappointing, particularly in view of the representations made by the parish council and myself, because unless the wall is built up where it is now, a far longer wall, using hundreds of acres of good
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    agricultural land, will be needed. This is a penny-wise, pound-foolish policy. The Ministry must grant the money to make this defence.
    Mr. Mackie: That is exactly what I said to the hon. and gallant Gentleman. It is the job of the board to come forward with an economically viable scheme and then—[Interruption.]—I do not think that the hon. Gentleman would suggest that the present Government would spend anything unless the project was economically viable. But if that is what the Opposition want, we might take a look at it.

    Pig, Milk and Beef Production
    Mr. Hawkinsasked the Minister of Agriculture, Fisheries and Food whether he estimates that the increase in the guaranteed price for pig meat will recoup pig farmers for the increased costs.
    Mr. Monroasked the Minister of Agriculture, Fisheries and Food (1) whether he estimates that the increase in the guaranteed price for milk will recoup dairy farmers for their increased costs;
    (2) whether he estimates that the increase in the guaranteed price for beef will recoup beef farmers for their increased costs.
    Mr. Hoy: Costs, like output and productivity, vary considerably between different farms. I am satisfied that, after taking into account all the relevant factors, the increased guaranteed prices will ensure that the momentum of expansion in pig, milk and beef production will be maintained in accordance with the objectives of the selective expansion programme.
    Mr. Hawkins: But has the Minister not just said that beef production was beginning to fall or had fallen this year? Does not the hon. Gentleman agree that the farmers, including the pig farmers, have recently had very large costs added to their production?
    Mr. Hoy: The hon. Gentleman has referred to beef production. I would remind him that we have had the foot-and-mouth epidemic which has meant the retention of a considerable number of animals. It is true that pig costs have increased, but the bulk has been for feed,

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    where there is an effective price guarantee which is automatically raised every week to meet this situation.
    Mr. Monro: In relation to milk production, has the effect of dilution been taken into consideration? Does it not mean an increased cost of 2d. a gallon which will never be covered?
    Mr. Hoy: Increased costs have been taken into account in accordance with our assurance last year. Indeed, those negotiating on behalf of the farmers' unions this year made sure, even if we ourselves had wanted to forget, that these costs were considered when prices were fixed.

    Guarantees and Support
    Mr. Priorasked the Minister of Agriculture, Fisheries and Food how the£52½ million increase in guarantees is related to the estimated increased cost of Exchequer support of £16 million.
    Mr. John Mackie: £16 million was the increase estimated in the cost of support in 1968–69 over 1967–68 before the Review determinations were taken into account. The effect of the determinations is estimated to increase this cost by a further £31 million. This figure of £31 million differs from the total Review determination of £52½ million for several reasons; in particular, price guarantees for some commodities do not involve Exchequer payments and the payment periods for some items do not correspond with the financial year.
    Mr. Prior: Does this mean that, as a result of increasing minimum import prices, the subsidy will not be as great as it otherwise would be? If that is so, why have the Government changed their mind, and why has the hon. Gentleman changed his since he voted in favour of a levy system when the Measure was going through the House?
    Mr. Mackie: Anything which changes the price of a commodity upwards reduces the size of the Exchequer contribution.

    Milk
    Mr. Priorasked the Minister of Agriculture, Fisheries and Food whether he will estimate the increase in the milk pool price in 1968–69 over 1967–68.
    Mr. Hoy: So many uncertain factors affect the situation this year that it is not possible to make any firm forecast at this stage.
    Mr. Prior: Is not one of the factors involved that we are still allowing very large imports of cheap milk products to come in? Does not this dilute the price of milk to the producer enormously? What intentions have the Government to stop this trade going on?
    Mr. Hoy: I remind the hon. Gentleman that we must adhere to agreements entered into by the previous Government and I am certain that the Opposition would expect us to honour them. We have undertaken to discuss with the farmers' unions the proposals for a milk products levy.
    Mr. Peter Mills: No wonder the Minister cannot forecast this figure. Will the hon. Gentleman now tell us how the farmers will cover the increased cost they have in milk production, which is at least 2d. a gallon?
    Mr. Hoy: At the Annual Price Review the award was worth over £11 million. If the hon. Gentleman has not yet understood that, the country does. Obviously, anything which takes place this year will have to be taken into consideration at the next Price Review.
    Dame Irene Wardasked the Minister of Agriculture, Fisheries and Food whether he will give an assurance that he will retain the present system on which the remuneration of the milk distribution is based, in view of the need to maintain regular supplies of milk in sparsely populated areas.
    Mr. Hoy: The hon. Lady no doubt has in mind Report No. 46 of the National Board for Prices and Incomes. Consultations are taking place with the organisations concerned. I cannot anticipate the outcome.
    Dame Irene Ward: Is the hon. Gentleman aware of the great anxiety of dairymen who are making very strong representations, as they want to continue supplying milk to the sparsely populated areas? Is he aware that, under the possible arrangements forecast, they seem to be in great difficulty? Will he give their claims very sympathetic consideration?
    Mr. Hoy: I am aware of the extent of the feeling that has been provoked among certain dairymen. When we got the Report of the National Board for Prices and Incomes we felt it only right to consult with dairymen, along with others. The point of the hon. Lady will have serious attention.
    Mr. Peter Mills: Does the Minister realise how important this matter is? Is he aware that it is not only a question of increased costs to some of the towns and rural areas, but involves the whole question of health and treated milk?
    Mr. Hoy: We are dealing with the Report of the Prices and Incomes Board. I realise how serious this can be, especially in the rural areas. It might not have the same effect in urban areas as in rural areas but it could have serious repercussions. I have said that I will give it attention.
    Mr. Hastingsasked the Minister of Agriculture, Fisheries and Food what method of sampling was used by the National Board for Prices and Incomes when compiling its figures for the remuneration of milk distributors quoted in Command Paper No. 3744, and, in particular, for the figures in table 3.
    Mr. Hoy: I understand that the Board based its table on material provided by this Department.
    Mr. Hastings: Is it not true that these figures are based on an ad hoc sample taken in 1942 which was never intended as a measure of absolute cost but simply as one of movement? If that is so, does it not mean that the recommendations of the Prices and Incomes Board, particularly concerning retailing in the provinces, are invalid?
    Mr. Hoy: It is not for me to make a judgment on that matter. I answered an earlier Question on this point. The hon. Gentleman should remember that the Prices and Incomes Board is an independent body. It has discretion to determine the method by which it carries out an investigation. It is for us, at the end of the day, to make a judgment on the case which it has presented to us. As I said earlier—I do not know whether the hon. Gentleman was here at the time—I shall certainly give serious consideration to representations which we receive.

    Fishing Industry
    Mr. Wallasked the Minister of Agriculture, Fisheries and Food if he will now make a statement on his Department's review of the fishing industry.
    Mr. Peart: I am not yet in a position to add to the Answer given to the hon. Member on 28th February.—[Vol. 759, c. 1404–5.]
    Mr. Wall: Will the right hon. Gentleman undertake to make a statement on this long delayed review before the Whitsun Recess? Is he aware that we shall want to debate this subject separately from the usual debate on the White Paper on the herring subsidy?
    Mr. Peart: I appreciate the need for an early statement. I have been having meetings with representatives of the industry. I am anxious to make a statement as early as possible.
    Mr. McNamara: May I press on my right hon. Friend the urgent need for the review to be published, since there is tremendous uncertainty in the industry and a threat to employment in Hull? There is great anxiety amongst fishermen lest trawelers have to be laid up.
    Mr. Peart: I am aware of this concern and I am anxious that the results of the review, which we have been awaiting for some time, shall be published as soon as possible and that we shall be able to take what steps are necessary. But I cannot announce a date yet.
    Sir C. Osborne: Is the right hon. Gentleman aware that, in Grimsby, genuine fears are being expressed that many trawlers will have to be withdrawn from the industry because it is unprofitable? It is not only the trawler owners who are complaining but the men, who are frightened of losing their jobs. Will he do something quickly?
    Mr. Peart: I am aware of the problems. As I have said, I have held meetings with representatives of the industry and they have given me details. I must look carefully at the review and I cannot announce it yet.
    Mr. James Johnson: Is my right hon. Friend aware that sensational statements have been made at Hull by some leaders

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    of the industry to the effect that 30 vessels may be laid up? This is causing great anxiety. Can my right hon. Friend give an assurance that he is constantly in touch with leaders of the industry?
    Mr. Peart: I had a meeting recently with leaders of the industry on this matter and I am aware of all the difficulties.
    Mr. Godber: This is a serious matter, as is evidenced by the questions from both sides of the House. The right hon. Gentleman must be aware of the concern in the industry. May we have a firm promise of a statement soon? We should have it before the Easter Recess but at any rate will the right hon. Gentleman make it as soon as possible afterwards so as to try to alleviate some of the axieties and deal with the problems?
    Mr. Peart: I am fully aware of the Need for a statement.

    Wise Committee (Report)
    Mr. Farrasked the Minister of Agriculture, Fisheries and Food when he will decide the course of action that is to be taken in relation to the recommendations in the Wise Report, that certain estates, including Elmesthorpe, be closed.
    Mr. Godberasked the Minister of Agriculture, Fisheries and Food when he proposes to announce his decision in regard to the future of the three Land Settlement Association Estates which the Wise Committee recommended should be withdrawn from the Land Settlement Association scheme.
    Mr. Peart: I regret that I am still not able to make a statement on the future of these estates, but I will do so as soon as possible.
    Mr. Farr: This is yet another matter on which the right hon. Gentleman is required to do something. Is he aware of the distress and suffering being caused to tenants who have to work these estates under sentence of death, as it were? Cannot he get on with it?
    Mr. Peart: I am always anxious to speed up and do things. I do a lot of things for the agricultural industry, though I am usually attacked by hon. Members opposite for it. The livelihood of these tenants is at stake and I am anxious to
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    make the right decision after careful inquiries. 'I am not going to be rushed into taking action which might be disastrous. I must be sure of taking the right long-term view, and that I shall do.
    Mr. Godber: But the right hon. Gentleman has had adequate time. We want him to take the right decision, as it is very important for the tenants. But this Sword of Damocles hanging over their heads has been there a long time and it is up to the right hon. Gentleman to say something to enable these tenants to plan their future. Is not he aware of the real concern there is?
    Mr. Peart: I am aware of that concern and it is for that reason that I am making careful inquiries and studies. Of course many of the tenants are worried and concerned. I am well aware of that, since I have met their representatives and I want to make the right decision.
    Mr. Hawkins: The Wise Report has been out nearly two years. When are we going to get action on it or at least a debate?
    Mr. Peart: There were two sections to the Report, the first part dealing with local authority smallholdings. The question of a debate is a matter for my right hon. Friend the Leader of the House and if the hon. Gentleman feels strongly about it he must ask him.
    Mr. Ridsdaleasked the Minister of Agriculture, Fisheries and Food whether he will make a further statement on his proposed legislation following the Wise Committee's Report.
    Mr. Peart: I intend to introduce legislation to implement the proposals announced in reply to my hon. Friend the Member for Norfolk, North (Mr. Hazell), on 7th March [Vol. 760, c. 156–8] but I cannot yet say when this will be possible.
    Mr. Ridsdale: Am I to understand that the Minister is proposing legislation to allow units which are financially viable to become independent? If so, is he aware how much some of us will welcome this measure of denationalisation, however small? When will he implement this legislation or is he coming to this side of the House before then?
    Mr. Peart: I cannot go beyond what I have already said.

    Import Controls (Levies)
    Mr. Joplingasked the Minister of Agriculture, Fisheries and Food whether he now intends to introduce a system of import controls through levies.
    Mr. Peart: I am always ready to consider possible modifications and improvements in our system of agricultural support; but a switch to a comprehensive system of import controls by levies raises many problems, not least in relation to our international obligations and general commercial policy and also with regard to consumers.
    Mr. Jopling: Would not the right hon. Gentleman at least agree that it would be better if, instead of increasing minimum import prices for cereals, so giving our suppliers overseas a free bonanza, he raised the price through a levy system?
    Mr. Peart: I am not so sure that that would be the right decision. Minimum import prices for cereals were introduced by my predecessors. We are having discussions with our overseas suppliers and we may well have to consider a levy system if we do certain things. However, I hope that it is appreciated that this system would not necessarily bring certainty, least of all to the consumers.
    Mr. Brooks: Will my right hon. Friend resist the siren voices and recall that many of us who on balance supported Britain's application to join the Common Market always regarded the levy system as the least attractive part of the bargain? In the present circumstances of the Common Market, will he resist pressure to introduce this measure in isolation from all the other possible benefits which might have arisen from the package deal?
    Mr. Peart: I am interested in this problem. I note the change of right hon. Gentlemen opposite I hope that they appreciate that rushing to adopt such a system quickly could have disastrous effects on the industry and on consumers.
    Mr. Hooson: Is the right hon. Gentleman aware that when I pressed the Conservative Government to introduce a levy system, I was told that it was difficult to do so because of our international obligations? Can he tell the House what
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    those international obligations are and what their present extent is?
    Mr. Peart: There are several international obligations affecting certain commodities. For example, there is the Bacon Sharing Agreement; we have international obligations for supplies of butter from countries like New Zealand; we have a minimum import price system affecting cereals from countries like the United States, Australia and Canada.
    Mr. Godber: Is the right hon. Gentleman aware that we are very interested in his change of tone on these matters over recent weeks and that we hope that this means that he has now accepted the logic of such a change? Will he accept our assurance that we will gladly help him to change from the position which he has had so strongly maintained over the last two or three years when he has said that this system was all wrong? He now says that he at least sees something in it. Let us hope that he will go a long way on these lines.
    Mr. Peart: I am always prepared to accept the logic of constructive change, but not Conservative change. Unlike the right hon. Gentleman, I have never been doctrinaire about these matters.
    Mr. Elystan Morgan: Can my right hon. Friend say how much substituting the levy system for the present system would add to Britain's food bill? Would it be much lower than the figure of £400 million per annum which was tentatively suggested by the Opposition some years ago?
    Mr. Peart: The right hon. Gentleman has made his statement and I have recently published a White Paper on the effects on the consumer of the adoption of the Common Market levy system. We have debated the subject. Right hon. and hon. Members opposite must accept that a change to that system would mean very high prices for the consumer.

    Meat (Import from South America)
    Sir J. Gilmourasked the Minister of Agriculture, Fisheries and Food what quantities of meat from South America he estimates will be imported into this country in each of the first eight weeks after the lifting of the ban imposed by him at the time of the foot-and-mouth disease epidemic.
    Mr. Peart: About 600 tons in the first week and, provided booked cargo space is filled, about 3,000 and 2,400 tons in the second and third weeks respectively. Most of this will be from Uruguay, with some from Brazil. The trade are not yet in a position to give me estimates for subsequent weeks.
    Sir J. Gilmour: As the Argentine is now refusing to send beef and as the Joint Parliamentary Secretary has just said that our own beef supplies are going down, is the right hon. Gentleman confident that he should not now review his rice Review award for beef cattle?
    Mr. Peart: I cannot review a Price Review award. I gave increased incentives to increase home production and this section of the Price Review was welcomed by the industry.
    Sir G. Nabarro: As the ban on the import of beef carcases is to be lifted on 15th April, what evidence does the right hon. Gentleman have that Uruguay and contiguous countries will not send us their piled up carcases saved up there throughout the period of the ban on imports here?
    Sir G. Nabarro: But not with diseased carcases.
    Mr. Peart: I cannot give precise details now, but I will do my best to get them for the hon. Gentleman.

    Dairy Calves
    Sir J. Gilmourasked the Minister of Agriculture, Fisheries and Food what estimate he has made of the number of calves from the dairy herd in England and Wales which are likely to be slaughtered at an early age in 1968–69; and what revision of that estimate he has now made following on the publication of the Annual Price Review.
    Mr. Hoy: I would certainly hope to see a lower rate of slaughter for young dairy calves in 1968–69, in response to the Annual Review award and to maintain the increase in herd numbers after the losses sustained through foot-and-
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    mouth disease. But the rate of slaughter has in any event dropped since the turn of the year and I would not like to put a figure on the possible difference as compared with 1967–68.
    Sir J. Gilmour: Does not the right hon. Gentleman agree that, based on the returns of last summer, the total breeding herd is around 4 million, that calves under one year old number about 2,500,000, that the majority of the deficiency must come from the dairy herd and that the difference between the 2,500,000 and the 4 million shows how much more beef could be produced from the dairy herd?
    Mr. Hoy: At this stage I shall not seek to confirm or deny the hon. Gentleman's figures. We gave an increase in the guaranteed price this year. We realise that some 70 per cent. of our beef supplies comes from the dairy herds, so that from all points of view we should like to encourage beef production.

    Inshore Waters (Herring)
    Mr. Wolrige-Gordonasked the Minister of Agriculture, Fisheries and Food what is his policy regarding the catching of herring in inshore waters.
    Mr. Hoy: I recently received representations from local fishermen that fishing for herring should be banned within United Kingdom fishery limits in an area off the North-East coast of England, but no decision will be taken until these have been discussed with other sections of the industry.
    Mr. Wolrige-Gordon: I should like to thank the Joint Parliamentary Secretary for that reply. Is he aware that this involves very serious issues and that fullest possible consultation with all parts of the industry is of extreme importance?
    Mr. Hoy: I am grateful for the hon. Member's remarks. We realise that this affects fishermen in other parts of the United Kingdom. We would obviously want to consult every section before reaching a decision.

    Import Prices
    Mr. Godberasked the Minister of Agriculture, Fisheries and Food what discussions he is holding with regard to the

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    question of minimum import prices or with regard to the imposition of levies on imports at the present time; and whether he will make a statement.
    Mr. Peart: Consultations with our main overseas suppliers are in progress concerning the level of the cereals minimum import prices following devaluation. There are also shortly to be discussions with the industry about suggestions it has made relating to imports of certain other agricultural products.
    Mr. Godber: Will the Minister keep in mind all the time that any changes that he makes, if they are based on a minimum import price system, must have an adverse effect on our balance of payments, whereas if he uses the levy system it will not have this effect? In answering this point, will he also clear up an inaccurate answer that he gave earlier on the levy, when he talked about very high prices for the consumer in the change. In fact, that change would be less than the effect of devaluation.
    Mr. Peart: I did not give an inaccurate answer. On the estimates of the right hon. Gentleman's own party the adoption of the levy system would force prices up. They said this. There is no doubt about this and they should not pretend. I inherited the minimum import price system from the right hon. Gentleman and I am having discussions about how to modify and improve it.
    Mr. Prior: Is the right hon. Gentleman aware that we welcome the talks that he is to hold with the leaders of the farming industry and, in so far as this is another broken election promise, will he go on with them?
    Mr. Peart: I was not aware that it was an election promise of mine not to have talks with the National Farmers' Union.
    Mr. Brooks: Is my right hon. Friend aware of any evidence to show that productivity is encouraged as a result of that imposition of a levy system?
    Mr. Peart: This is why I have said that we must be cautious, pragmatic and sensible, unlike hon. and right hon. Gentlemen opposite, who are doctrinal about this, and who would sacrifice the interests of the farming community tomorrow.

    Imported Beef (Inspection)
    Mr. Hoosonasked the Minister of Agriculture, Fisheries and Food if he will take steps to ensure that carcases of beef, imported from the Argentine and other countries where foot-and-mouth disease is endemic and which might contain salmonella typhimurium, should be inspected by qualified veterinary officers in this country before they are distributed.
    Mr. Peart: The port health authorities already have power to examine and test imported meat for conditions that may be injurious to public health, such as salmonella, but a veterinary inspection of carcases could not be relied upon to detect foot-and-mouth disease virus. I do not think, therefore, that the hon. Member's suggestion would improve our safeguards.
    Mr. Hooson: Is the Minister aware that there is great concern about the adequacy of inspection of imported meat? In view of the Answer given to the hon. Member for Worcestershire, South (Sir G. Nabarro), does he not think, as this is the only country which does not have inspection by veterinary surgeons, that we ought, as a matter of urgency, to introduce such a system?
    Mr. Peart: The hon. and learned Member has, in some strange way, confused the incidence of foot-and-mouth disease with salmonella. They are quite different. The arrangements that we have are, in the circumstances, sensible.
    Sir A. V. Harvey: Is the right hon. Gentleman aware that he has misjudged the whole situation and, having alienated the wishes of the farming community, he will not get the meat from Argentina anyhow? Where has this got him?
    Mr. Peart: I have carried on a system about which over many years my predecessor did nothing. I am now examining this carefully, and have already set up the Northumberland Committee on foot-and-mouth disease. On other matters affecting salmonella, this is a matter for the Ministry of Health. As far as I am concerned, if we can improve the system in existence we shall do it.
    Mr. Godber: The Minister keeps repeating that he is doing something,

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    but the whole situation has been changed by this latest epidemic and it was incumbent upon him to do this. Is he aware that he must safeguard supplies coming in now as much as he safeguarded those already in?
    Mr. Peart: I cannot accept that the situation has changed. If hon. Members were really sincere in their desire to improve health arrangements in the general sense why, in all the years that they had, did they do absolutely nothing?
    Sir Harmar Nicholls: On a point of order. Although it is not my Question, in view of the unsatisfactory Answer, I beg to give notice that I shall try to raise this important matter, before 15th April, on the Adjournment.
    Mr. Speaker: Order. The hon. Member must give notice in the conventional way.

    Foot-and-mouth Disease
    Mr. Biffenasked the Minister of Agriculture, Fisheries and Food to what extent there has been recrudescence of foot-and-mouth disease arising from the epidemic circumstantially ascribed to Argentine lamb; and if he will make a statement.
    Mr. Peart: Disease has appeared again on seven of the 1,700 farms which have been restocked. Four of these were premises where extra disinfection had already been carried out. All are due to the same type of virus as the original series.
    All premises still to be restocked or recently restocked, are being surveyed again and further destruction of feedingstuffs carried out where necessary. Not more than 50 cattle or pigs will be allowed on any farm premises for the first fortnight after restocking.
    Mr. Biffen: Is the right hon. Gentleman aware that since I put down this Question, there has been a new outbreak at Weatherford Hall Farm, Shawbury? Could he say whether, in the judgment of his veterinary officers, that is an outbreak which has resulted from recrudescence in adjacent areas or whether it is a new primary outbreak?
    Mr. Peart: So far my veterinary officers have not been able to trace the origin. The virus type is "O" and the
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    sub-typing is not yet completed. As soon as I have the sub-type, I will let the hon. Member know the result.
    Mr. More: Does not this new outbreak make it all the more important that the Minister should not lift the ban on 15th April? Will he revise his thoughts on this important matter?
    Mr. Peart: The hon. Member must appreciate that the House took a decision on this. The situation is still the same.
    Mr. Dance: Would not the Minister agree that, as there is so much doubt about this Argentine meat, it would be a great deal better to increase meat imports from New Zealand?
    Mr. Peart: The hon. Member will be well aware of the action of the Government on this. Since then, we have sent a veterinary mission to South America and it is still there.
    Mr. Gurdenasked the Minister of Agriculture, Fisheries and Food what compensation he will pay to butchers who, because of his restrictions on imported meat, have had considerable losses in meeting Government contracts.
    Mr. Peart: I recognise that the measures taken in connection with the foot-and-mouth outbreak have involved many businesses and individuals in loss, but I regret that I can make no exception to the policy of not paying compensation for consequential losses.
    Any question arising from a contract to supply meat to a Government Department should be addressed to the Minister responsible for that Department.
    Mr. Gurden: Is the right hon. Gentleman aware of the example in my constituency of a butcher who is still holding over £20,000 worth of meat and is not allowed to touch it by the Government? Would he have a word with his right hon. Friends to get something done about compensation?
    Mr. Peart: I am not aware of the details of that case, but the hon. Member's hon. Friends will probably not want him to distribute that meat. If there is any difficulty with a Government Department, approaches should be made.
    Mr. Hazell: If my right hon. Friend makes arrangements for compensation to

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    be paid to butchers, would he bear in mind that farm workers who have lost their employment or have suffered a considerable reduction in earnings are also entitled to compensation?
    Mr. Peart: I do not think that any Government could go beyond the system which we have now. Many people suffer consequential losses, such as my racing friends.

    Potatoes
    Mrs. Joyce Butlerasked the Minister of Agriculture, Fisheries and Food what consultation he has had with the Potato Marketing Board to ensure that the retail price of potatoes does not increase because of Board policy.
    Mr. Hoy: There is regular consultation between this Department and the Potato Marketing Board on all aspects of Board policy which might affect potato prices. I am satisfied that the Board's current market support operations should not lead to an increase in price to the consumer beyond what is normal towards the end of the season.
    Mrs. Butler: Is my hon. Friend aware that consumers are completely baffled at having to pay £5 million in taxation to prevent themselves from being able to buy cheap potatoes in the shops? Would he urgently review the policy of the Potato Marketing Board to ensure that consumers get greater benefit at this time of year instead of good food being left to rot?
    Mr. Hoy: We have continuous consultations with the Potato Marketing Board. We think that producers are getting no more than a fair return—this time of year it is about 2d. a lb. We think that this is fair to the consumer and to the producer. We have to aim at fairness.
    Mr. Scott-Hopkins: Can the hon. Gentleman say how many tons of the surplus stocks held will be destroyed by the Potato Marketing Board this year, what imports are coming into the country and from where?
    Mr. Hoy: I do not think that any potatoes will be destroyed. They may go for animal feed, and so on. I should not like to give a figure for imports. As the hon. Gentleman knows, the only
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    potatoes which are imported are new potatoes. Ordinary potatoes are not permitted into this country. [Interruption.] I have dealt with the question of frozen chips. We were quite unable to manufacture the chips owing to a little lack of private enterprise.

    Forestry Commission (Home- Grown Timber Trade)
    Mr. Moreasked the Minister of Agriculture, Fisheries and Food whether he is satisfied that the interests of the home-grown timber trade are sufficiently represented in the present membership of the Forestry Commission; and if he will make a statement.
    Mr. Peart: The Forestry Commissioners are appointed as individuals and not to represent specific interests. The Commissioners are closely in touch with the home trade through the Home Grown Timber Advisory Committee, which was specifically set up in order that the views of all sections of the industry should be available both to the Forestry Commission and to the forestry Ministers.
    Mr. More: When a new appointment to the Commission fell to be made last autumn, was there any prior consultation with the home-grown timber trade? As the appointment which was made left the home-grown trade unrepresented on the Commission, will the right hon. Gentleman undertake to ensure that before any new appointment is made such consultation will be held?
    Mr. Peart: The hon. Gentleman must appreciate that it has always been held that the members of the Forestry Commission should not represent specific interests. Incidentally, the person appointed has had 25 years' experience of the timber trade and took a degree in forestry at a university.
    Mr. Hector Hughes: Does my right hon. Friend realise that for the very reasons set out in this Question the Scottish home-grown timber trade is being prejudiced by foreign imports? Will he take steps to protect the Scottish homegrown timber trade?
    Mr. Peart: That is another matter. The Secretary of State for Scotland is responsible for it, not me.

    Rural Development Board Inquiries
    Mr. Hoosonasked the Minister of Agriculture, Fisheries and Food if he will take steps to provide financial support for objectors at rural development board inquiries to ensure that their case can be properly put by comparable counsel to those briefed for his Department.
    Mr. Peart: No. Sir. I am satisfied that the inquiry will provide full opportunity for objectors to state their case whether they choose to be legally represented or not.
    Mr. Hooson: As the Minister is to be represented by two eminent counsel, and as the objectors are, in the main, very small farmers, is it not fair that the Ministry should, in the long inquiry pending at Aberystwyth on Monday, provide objectors with the means of having equal representation?
    Mr. Peart: I do not think that any Government could take the action suggested; it would be very improper. I am aware that only one objector has raised the question of legal aid in connection with the Welsh Rural Development Board. What is important is that objectors should have ample opportunity to cross-examine the witnesses called on behalf of my Department. That will be done.

  SCOTLAND

    Agricultural Training Board
    Mr. William Hamiltonasked -the Secretary of State for Scotland what representations he has received to date from the farming community against the establishment of the Agricultural Training Board; and what representations he has received in support of the Board's efforts to give adequate training to all employees who want it.
    The Secretary of State for Scotland (Mr. William Ross): None, Sir, but I understand that the work of the Board is fully suported by the organisations representing the employers and workers concerned.
    Mr. Hamilton: Does my right hon. Friend recognise that hon. Members, par
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    ticularly hon. Members opposite, voted against the establishment of the Agricultural Training Board? Does lie not think it deplorable that Members who consistently criticise the Government for providing inadequate training facilities should take this action? Can he say how many workers in Scotland will avail themselves of these training opportunities?
    Mr. Ross: It is very difficult to give an assessment of how many people in Scotland will avail themselves of the opportunities given, but I know full well that there is anxiety to ensure that training facilities are provided, and that, in particular, those from sparsely populated areas will have an opportunity, for the first time, of proper training.

    Highlands (Transport, Agriculture and Distribution Costs)
    Mr. Nobleasked the Secretary of State for Scotland what estimate he has made of the increased costs in transport, agriculture and distribution imposed by the Budget within the area covered by the Highland and Islands Development Board.
    Mr. Ross: None, Sir.
    Mr. Noble: Does not the Secretary of State feel that a calculation of the increase in transport costs should be made, particularly in view of what has been happening recently in Inverness?
    Mr. Ross: No, I do not think that it would be possible to make any estimate of the kind the right hon. Gentleman suggests. It would be much better to take the whole matter in the round. He should bear in mind that in the Budget certain announcements about Selective Employment Tax in respect of hotels in rural areas were made, which should be put on the other side of the balance.
    Mr. Noble: But does not the right hon. Gentleman realise that the Question had nothing whatever to do with S.E.T.? There are real problems, and he or the Highland Development Board must make this calculation if we are to succeed.
    Mr. Ross: The right hon. Gentleman can take it for granted that we shall watch the economy in the Highland areas. We have now, which we did not have before, an instrument to deal fairly

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    effectively with the economy of the Highlands.
    Mr. Maclennan: Will my right hon. Friend consider making available the figures for the kind of assistance that is available within the seven crofting counties through Board of Trade grants, and through the Highlands and Islands Development Board's schemes?
    Mr. Ross: If my hon. Friend would like to highlight that kind of aid, he should put down Questions to the various Ministers and the answers will be there in HANSARD.
    Mr. Wolrige-Gordon: If, as in the case of agriculture, the Government are not able to make these estimates of cost, is not there an argument for exempting the Highlands from the effects of the Transport Bill until the costs are estimated?
    Mr. Ross: No, Sir.

MALTA (DOCKYARD)
The Minister of State for Commonwealth Affairs (Mr. George Thomas): My noble Friend, the Lord Privy Seal, in another place is today making the following interim statement.
"I wish to acquaint the House with the present position in relation to the talks with the Prime Minister of Malta, about the Malta Dockyard, which were concluded last Sunday.
These talks were essentially concerned with the financial help which the Malta Government sought in respect of certain proposals which Dr. Borg Olivier will be making to the Malta Parliament in the next few days. These proposals will have the effect of ensuring the continued operation of the Dockyard and will enable it to be developed for the benefit of the Maltese people and for all who work in the Dockyard. This is of the utmost importance for Malta and, I believe, for relations between our two countries.
The House will understand that until the proposals of the Malta Government have been made public it is not possible for me to make any detailed statement on this subject. I thought it right, however, to inform Parliament that the talks last week
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about the contribution which the British Government could make to a settlement of this problem were entirely successful. I hope to be able to give the House the details in a further statement before the Easter Recess."
I am sure I am speaking for all in this House in congratulating my noble Friend on the successful outcome of his talks with the Government of Malta about this difficult problem.
Mr. Maudling: I am sure that everyone is glad to hear of the progress being made on this extremely difficult problem. Is the hon. Gentleman aware that we look forward to hearing more details next week of the progress made?
Mr. George Thomas: Yes, Sir.
Mr. Thorpe: Is the hon. Gentleman likewise aware that any help which this country can give to the people of Malta to maintain its economy is something which we as a nation will gladly give? Without going into details, will the hon. Gentleman confirm that the arrangement will mean that the full employment of the people of Malta will be guaranteed?
Mr. George Thomas: On the first part of the question, both sides of the House have proved on more than one occasion that they are aware of the importance of helping Malta. Secondly, I would not like to go further than I have in my statement, but I assure the right hon. Gentleman that the full details will be made available to the House, or at least I earnestly hope so, before the Easter Recess.
Dr. John Dunwoody: Will my hon. Friend assure the House that in reaching a successful conclusion to these important negotiations consideration has been given to the interests of ship repair yards in this country, and particularly to those in the development areas where unemployment rates are very high?
Mr. George Thomas: All relevant interests were taken into account.
Mr. Wingfield Digby: Does this mean that it is hoped to avoid serious redundancy in the dockyard, pending the reopening of the Suez Canal? Is it also intended to give help to general engineering projects in the dockyard pending the reopening of the Canal?
Mr. George Thomas: It is hoped that the steps taken will help the dockyard to have a prosperous future.
Mr. Wall: I welcome the hon. Gentleman's general statement, but can he confirm that special facilities are being retained in the yard for Her Majesty's ships of the Royal Navy?
Mr. George Thomas: I could not comment on that at this stage.

PRICES AND INCOMES (WHITE PAPER)
Sir C. Osborne: On a point of order, Mr. Speaker. Will you guide me and hon. Members on the back benches on both sides of the House on a most important issue? I understand that a statement has been issued to the Press by some Ministers regarding the prices and incomes policy. The Press possess a copy of this statement, but the House does not. Furthermore, I understand that a statement is to be made to the Press at 4·30 this afternoon, without the House being told about it. How comes it that the Press are given information which is not available to the House, and how can back benchers protect their rights?
Mr. Speaker: It is very difficult for Mr. Speaker to rule on a matter of which he is as completely ignorant as the hon. Member is. It is usual for the House to know first, but the Chair can do nothing about this.
Sir C. Osborne: Further to that point of order. I apologise to you, Mr. Speaker, bit I have only just learned from the Press that they have this document, and that a statement is to be made to them. It seems not only discourteous to the House, but constitutionally wrong, that people outside the House should be told of a most vital issue, without the House being told. How can we protect ourselves?
The Minister of State for Commonwealth Affairs (Mr. George Thomas): Further to that point of order. As the House is not aware of what the hon. Gentleman is talking about, and as the details are not known, and as you have se id it is customary for the House to know first, with all respect to you, Mr. Speaker, you do not know whether the
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House will be told first. I beg to suggest that there is nothing to pursue.
Mr. Speaker: I am grateful to the hon. Gentleman, under the guise of a point of order, for defending the Government.
Sir G. Nabarro: Further to the original point of order. In view of the importance of these deliberations, and the point of order put by my hon. Friend the Member for Louth (Sir C. Osborne), would not it be appropriate if the Leader of the House were here to deal with this technical issue? Why is he always missing on these important occasions?
Mr. Speaker: I take that to be a rhetorical question. It is not Mr. Speaker's job to explain the presence or absence of Ministers, or back benchers on either side.
Mr. Peyton: On a slightly different point of order. Mr. Speaker, I am sure that we all sympathise with you because of the humiliating position in which the Government have placed you—
Mr. Speaker: Order. I think that to sympathise with Mr. Speaker is to be a little critical of him. Mr. Speaker does not need the hon. Member's sympathy. Perhaps he will come to his point of order.
Mr. Peyton: I assure you, Mr. Speaker, that in no way was my sympathy critical of you. It was no criticism, disguised or otherwise. What I want to know is whether you think that confusion has now been worse confounded by the effort of the Minister to intervene on a matter which is nothing to do with him, and on which he is thoroughly incompetent to speak. The House has been left in a state of complete confusion. One hopes that some initiative will come from somewhere to end these humiliations, which the Government pile on the House so gratuitously, and without, evidently, ever being prepared to learn from their mistakes.
Mr. Speaker: These are matters which the hon. Member must take up in the ordinary way of Parliament with people on the other side with whom he disagrees.
Sir Harmar Nicholls: On a point of order. It has now been confirmed that the statement will be made outside the

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House, not at 4·30 as my hon. Friend the Member for Louth (Sir C. Osborne) said, but at 5 o'clock. This confirms that it is to be made outside this Chamber. How can back benchers—[Interruption.]—
Mr. Speaker: Order. The hon. Member for Worcestershire, South (Sir G. Nabarro) must control his magnificent voice.
Sir Harmar Nicholls: How can back benchers protect their rights? Now that the Leader of the House is here, one hopes that he will to some extent mitigate this slur on the House as a Chamber by giving us some advance notice of what he is giving to the Press.
Mr. Speaker: None of this constitutes a point of order for the Chair.
Sir A. V. Harvey: On a point of order. I am sure that you, Mr. Speaker, appreciate the position in which back benchers find themselves. The Government are making it doubly difficult for us to perform our duty. The Leader of the House arrived in the Chamber at 3·40 p.m. and I do not know whether or not he proposes to make a statement on this matter. The Patronage Secretary has not been here this afternoon and we are left with one lonely Minister of State who does not seem to understand the problem. I therefore ask, through you, Mr. Speaker, if the Leader of House will help us in this situation.
Mr. Speaker: Perhaps we might now get on with the business of the House.
The Lord President of the Council and Leader of the House of Commons (Mr. Richard Crossman): It might be convenient if I comment on the matter. I regret that I was not in my place, but I did not know that there would be this commotion. A White Paper on prices and incomes has been published this afternoon. It is not the automatic pro
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cedure for a Ministerial statement to be made on all White Papers; for example, the Defence White Paper is published and there is normally a Press conference, without a statement being made. We then have a debate afterwards. I thought that this matter was of sufficient importance to have it published in the normal way, and, of course, it will be debated at extensive length. However, I take cognisance of the fact that hon. Gentlement opposite prefer to have Ministerial statements on all White Papers, although, as I say, that is not the normal procedure. However, I would never turn down the idea that we should consider a novel experimental procedure of this kind.
Several Hon. Members rose—
Mr. Speaker: Order. We must move on.
Later—
Mr. Peter Emery: On a point, of order, Mr. Speaker. May I ask you to protect back bench Members of the House from inaccurate statements by the Leader of the House? It will be within your memory that, only a few moments ago, the Leader of the House informed the House that the Prices and Incomes White Paper had been published. If this is so, it is not available to hon. Members. It is not in the Vote Office, and I am informed by the Vote Office that it has not been published. This makes the situation even worse. I wonder what protection back benchers can have from the Chair against inaccuracies by the Leader of the House.
Mr. Speaker: The hon. Gentleman should make his complaints at the appropriate moment to the Leader of the House. He will have the opportunity tomorrow at Business time. if Mr. Speaker had to protect hon. Members from inaccurate statements by Ministers and ex-Ministers, his labours would be almost too big to cope with.

GENERAL RATE ACT 1967 (AMENDMENT)
3.42 p.m.
Sir John Eden: I beg to move,
That leave be given to bring in a Bill to exempt for the purposes of assessing rate rebate the amount payable as compensation for war disablement and the amount of pension or other benefit payable to the widow or dependant of an officer or man who lost hi life through a cause arising out of his service with Her Majesty's forces.
The House will know that until 1966 compensation for war disablement had al ways been given exceptional treatment. In that year, however, the Government departed from earlier practice by requiring local authorities to take fully into account the amount of a ratepayer's war disability pension and allowances when assessing his total income for the purposes of the rate rebate scheme.
The Bill seeks to restore to war disability compensation and Service widows' benefits the consideration they had always been given. These payments, as hon. Members will, I am sure, accept, are unique in character. They were eared in special circumstances, in the service of the country, and for that reason successive Governments and Chancellors of the Exchequer have in the past excluded war disability pensions and allowances from assessment for Income Tax purposes. In addition, for the purposes of the Supplementary Benefits Scheme, the first 40s. of a disability pension is disregarded when assessing the extent of an individual's needs.
More recently, in the joint circular No. 46/ 67, the Minister of Housing and Local Government and the Secretary of State for Wales gave discretion to local authorities similarly to disregard up to the same 40s. war disability payment for the purposes of the rent rebate scheme. These payments cannot, therefore, be compared with the contributory social service benefits; they are quite separate from the normal operations of the Welfare State.
Now, as a result of the Rating Act, 1966, for the first time the total amount paid in compensation is fully taken into account. This has created an entirely new situation. Provision has been made
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to relieve any financial distress which may be caused by the rising rate burden, but disabled ex-Service men are unable fully to share in it solely because of the amount they receive in compensation.
The person who is hardest hit is the badly disabled ex-Serviceman who has few sources of income other than his compensation payment—for example, a man who had lost two limbs would be assessed at the rate of 100 per cent., giving him £7 12s. a week in compensation. The prescribed limit for the purposes of the rate rebate scheme is less than £8 a week for a single person or less than £10 for a married couple.
Although all disabled ex-Servicemen are affected by the treatment of their compensation payments in this way, it must weigh particularly heavily on ex-Servicemen disabled in the First World War. During the difficult inter-war years of high unemployment and depression they had a hard struggle to find additional sources of income. Many of them, therefore, have little beyond their normal State pension.
Consider the case of two married couples, both of whom are in receipt of their National Insurance retirement pension. In these circumstances they would both be eligible for rate rebate, but if one of the men had been badly shot up, leading to the amputation of an arm or leg, he would be getting a 60 per cent. war disability payment amounting to about £4 11s. a week. This would put the total income of his household above the limit eligible for the full amount of rate rebate. It must be wrong that the man with the severest disabilities should be penalised in this way.
These payments represent compensation for the effects of the Service disablement and they are not related to the financial hardship of the individual or even to the loss of his earning ability. They are related only to the extent of the amputation which had been made necessary as a result of injuries received in the service of the country. They are paid without any strings attached and they represent, albeit in a small way, part of the debt we owe them.
The Bill seeks to alter the provisions of the General Rate Act, 1967, so that when considering, under Section 49(1) and (2), the right to rebate in respect of rates on

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dwellings, these Service payments shall be disregarded. Although many local authorities have already indicated their support for the Measure, there are some which fear that it might lead to unnecessary complications in the operation of the rebate scheme. But there need be no complicated system, for the form of application for rate rebate could simply ask the applicant whether any payment, and, if so, how much, is made in compensation for war disablement or Service widows' benefit.
It is not possible, without knowing personal income details, to estimate the cost of implementing the provisions of the Bill. There are about 22,000 limbless ex-Service men whose disablement is assessed at 40 per cent. or more. About 10,000 of these are veterans of the First World War. The total number of Service widows is about 119,000. It follows that these people would not all be eligible for rate rebate since it obviously depends on the amount of other income that they have. It is also a fact that they are spread thinly throughout the United Kingdom so that the extent of the impact on local authority rates of the provisions of the Measure would be negligible, if anything at all.
The demand to alter the decision made by the Government in 1966 and to restore to compensation benefits the special treatment they have always received is supported by the Joint Committee of Service and Ex-Service Organisations which includes the British Limbless Ex-Servicemen's Association, the British Legion, the British Legion of Scotland, and many other national Service bodies. In July, 1966, hon. Members in all parts of the House tabled a Motion regretting that, by legislation imposed earlier in
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the year, war disability pensions were included as income in connection with the rate rebate scheme. The Motion went on to call on Parliament to revise that decision
"…thereby restoring the traditional disregard which hitherto has always been given to disability pensions arising from war service."
I had hoped that hon. Gentlemen opposite would join me in sponsoring the Bill, but, most unfortunately—and I say this sincerely—they have felt unable to do so. However, I know that I speak not only for my hon. Friends but for hon. Members in all parts of the House when I say that this is a Measure with which they will all feel the greatest personal sympathy. Even at this late stage in the Parliamentary time-table, if hon. Members were so determined, this Bill could still become law. If that were done, an injustice would be corrected and the nation's debt of honour paid.
Question put and agreed to.
Bill ordered to be brought in by Sir J. Eden, Sir R. Cary, Mr. Lubbock, Mr. Boyd-Carpenter, Dame Irene Ward, Sir T. Beamish, Mr. Neave, Mr. Mawby, Mr. Besse11, Captain W. Elliot, and Miss Harvie Anderson.

GENERAL RATE ACT 1967 (AMENDMENT)
  GENERAL RATE ACT 1967 (AMENDMENT)
  Bill to exempt for the purposes of assessing rate rebate the amount payable as compensation for war disablement and the amount of pension or other benefit payable to the widow or dependent of an officer or man who lost his life through a cause arising out of his service with Her Majesty's forces; presented accordingly and read the First time; to be read a Second time upon Friday, 10th May, and to be printed. [Bill 122.]
ORDERS OF THE DAY

  INDUSTRIAL EXPANSION BILL
  As amended (in the Standing Committee), considered.
  Mr. Speaker: As is my custom. I have 'posted up my selection of Amendments, and we come first to No. 3 on page 5902—
  3.53 p.m.
  Mr. Nicholas Ridley: On a point of order Mr. Speaker. With regard to the business now before us, Clause 12 proposes that power should be taken to acquire the Beagle Aircraft Company. I was not a member of the Standing Committee, but I see from the report of the proceedings in Standing Committee on that Clause that the Minister undertook to make available to hon. Members a duplicated memorandum of the figures of profits, losses and turnovers of the Beagle Aircraft Company so that it could be studied before the Clause was further considered. I do not know whether hon. Members who wore on the Standing Committee have received such a memorandum but, so far as I am aware, it is not generally available to hon. Members who were not on the Standing Committee, and I have been unable to trace it. I would further suggest that this Clause is a very important Clause—
  Mr. Speaker: This is most irregular. The Bill has been to Committee. When it was in Committee, its various Clauses, including Clause 12, were discussed. If on Report we were to discuss some Amendment to Clause 12, the hon. Gentleman would be in order in speaking about it when we reach it. I see from my Paper that we have no selection of Clause 12 or Amendments to it for discussion on Report. The hon. Gentleman may, when we come to Third Reading, animadvert to Clause 12 or any Clause in the Bill, but he cannot in the guise of a point of order seek now to take part in a debate which occurred in Committee some time ago.
  Mr. Cranley Onslow: Further to that point of order, Mr. Speaker. There is, as you will have observed, an Amendment on the Order Paper in the name
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  of an hon. Gentleman on this side of the House which you have not selected for debate. I have no intention of challenging your selection, but may I suggest that it would assist the House, when we come eventually to the stage at which we can debate this, if the Minister were to be seized at this point of his failure to make available this material to this House?
  The Minister of Technology (Mr. Anthony Wedgwood Benn): This is irregular, but during the Committee stage I was asked by members of the Committee for information. I undertook to prepare information. It has been prepared in my office and I understand that it has been sent at any rate to some members of the Committee. This is further information of a kind that a Minister might easily be asked to give in Committee which I undertook to provide, but it lies outside the ambit of the Bill as such. It is available in the Vote Office, and hon. Members who wish to have access to it will be able to do so. I hope I shall not get into trouble with the House for having gone further than most Ministers in trying to meet specific questions and providing duplicated information for the convenience of hon. Members.
  Mr. Speaker: Perhaps we might now get on with the Report stage of the Bill.

  INDUSTRIAL EXPANSION BILL
    Clause 1.

      PROVISION OF MONEY FOR INDUSTRIAL INVESTMENT SCHEMES.
      Mr. David Price: I beg to move Amendment No. 3, in page 1, line 14, at end insert:
      In any draft of a scheme involving more than £250,000 of public moneys there shall be an accompanying memorandum stating all the facts necessary for the formation of an informed judgment as to the merits or demerits of the scheme, with especial emphasis upon profit forecasts and assets valuations.
      Mr. Speaker: We are discussing with this the Amendment proposed by the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) to the Amendment, in line 1, leave out from 'scheme' to 'there'.
      Mr. Price: This Amendment had some relevance to the exchange of points of order that we have just had, as it is

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      aimed at trying to ensure that a minimum of information is made available to the House when we discuss industrial investment schemes brought forward under the Bill.
      Many hon. Members may have fallen into the same error as I did. When I read subsection (2) of Clause 1, I came across the phrase "a draft of the scheme". I admit to the House that I got into difficulties in Standing Committee on that phrase, because I was rash enough to think it actually meant what it said; that, when a Minister was bringing an industrial investment scheme before the House under this Clause, he would produce a draft rather like a White Paper which, according to the terms of this subsection, the House would be invited to approve, and subsequently the Minister would bring forward the statutory instrument technically and probably more narrowly drawn than the wider draft scheme. I was put right in Standing Committee and told by the Minister that the phrase "draft scheme" means a Statutory Instrument before it has passed the House. The phrase "draft scheme" is Parliamentary legal jargon.
      I am sure that the House will agree with me that, in order for the House to approve or disapprove an industrial investment scheme, it must have adequate information upon which to decide the merits of such a scheme.
      If hon. Members doubt the risks that are involved in the possibility of the House getting inadequate information, I would ask them to look at Clause 12, upon which points of order have just been raised. The Clause allows the Government to purchase the Beagle Aircraft Company. If they study what went on in Standing Committee they will see the struggle we had to elicit from the Government sufficient information to enable us to form any opinion as to whether this was a good buy or a bad buy for the public purse.
      My Amendment endeavours to address itself to how much information it is reasonable for the House to require. Is it possible to lay down precisely the heads of information that we will require in every set of circumstances? In drafting this Amendment, I considered whether one should lay down certain
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      heads like capital turnover, number of employees, and so forth. I came to the conclusion that this would be difficult. If one was inclusive in the heads of information that one wanted, they might be inappropriate to some of the smaller schemes which the right hon. Gentleman has it in mind to promote under the terms of the Bill.
      4.0 p.m.
      It seemed to me that we could do a lot worse than use the words I suggest when I ask for
      "…an accompanying memorandum stating all the facts necessary for the formation of an informed judgment as to the merits or demerits of the scheme, with especial emphasis upon profit forecasts and assets valuations."
      I have taken those words from the New City Code on Take-overs and Mergers, which will be familiar to some hon. Members, and which was worked out by the City Working Party under the chairmanship of Sir Humphrey Mynors, who is a former Deputy Governor of the Bank of England and is currently Chairman of the F.C.I.
      That document says:
      "Shareholders must be put into possession of all the facts necessary for the formation of an informed judgment as to the merits or demerits of an offer. Such facts must be accurately and fairly presented and available to a shareholder early enough to enable him to make a decision in good time. The obligation of the offerer company in these respects towards the shareholder of the offeree company is no less than its obligation towards its own shareholders. Without in any way detracting from the imperative necessity of maintaining the higher standards of accuracy and fair presentation in all communications to shareholders in takeover or merger transactions, attention is particularly drawn in this connection to profit forecasts and assets valuations."
      Under the terms of Clause 1, we in this House are put in the position of being trustees for the mass of taxpayers who, in respect of this Bill, are akin to shareholders. In view of that, my proposal should command general sympathy.
      I have put a lower limit of £250,000 in my Amendment. I observe that my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) has tabled an Amendment to delete that limit. However, the House may recall that the Minister told us in Standing Committee that, under the provisions of the Bill, he intended to carry out a number of quite

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      small schemes. He quoted as an example pre-production orders for machine tools. He went on to explain that he saw three types of scheme emerging. There was the small type of scheme which might be almost in the nature of launching aid. There was the large but probably single company type of scheme, and Beagle Aircraft might come into that category. Then there were the much wider schemes which are specially dealt with under Clause 3. All three types come under the provisions of Clause 1. By putting on this lower limit, it seemed to me that one would be dealing with the major schemes and leaving out the minor ones.
      I said in Standing Committee, and I repeat for the benefit of the House, that I believe we should concern ourselves rather more with the large sums than with the small sums. I would like to take the old adage about looking after the pence and letting the pounds look after themselves and put it the other way round. If we in this House look after the millions, the thousands and ten thousands will look after themselves. We ought to be interesting ourselves in the major schemes, and it is for these major schemes that I seek further information than we can guarantee getting under a draft scheme. It must be remembered that such a scheme will be prepared by Parliamentary draftsmen who will try to restrict the wording of it to that which is strictly necessary for legal purposes and will not necessarily include the sort of information which right hon. and hon. Members will require to make an economic and social judgment of whether it merits their support.
      I hope that my Amendment commends itself to all parts of the House. May I remind hon. Members of paragraph 8 of the White Paper which accompanied the presentation of the Bill? The Ministers promoting the Bill said:
      "It is time to establish a rigorous, independent and consistent system of appraisal for these cases to ensure that Government help is provided fairly and economically. At the same time, provision should be made for more effective and rapid Parliamentary scrutiny of individual projects."
      It is in pursuance of that intention that I move the Amendment.
      Mr. Ridley: I agree strongly with what my hon. Friend the Member for Eastleigh (Mr. David Price) has said about
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      the Amendment, and I shall support him in a few words later on in what I have to say.
      First, I question whether it is wise to have a lower limit. Any scheme under the Bill should be subject to the full rigours of scrutiny, with the figures being made public for all to see before any investments of this sort are made. I take my hon. Friend's point that we should concentrate on the millions and let the small amounts look after themselves. However, I cross swords with him when he attempts to turn round the old adage. If we look after the pence, the pounds will look after themselves.
      The Bill should not be used as a vehicle for making a lot of minor investments in industry. I am against the principle of the Bill as a whole, but this is not the time to discuss that. If we are to have this sort of interventionism, each scheme should be clearly delineated and set out with all the relevant information before being brought before the House and the public for scrutiny.
      I am sure that it is wrong for the Government to go into a series of minor investments under a Bill like this, and I cannot think of examples where investments under 100,000 will be made. This is no area for Government intervention. It is one for banks and merchant banks. By removing the lower limit in my hon. Friend's Amendment, it is made more difficult for the Government to engage in these small-scale schemes. They are not the main purpose of the Bill. In view of that, I hope, on consideration, that my hon. Friend will agree to accept the principle of the Amendment that I have tabled to his Amendment.
      As a whole, my hon. Friend's Amendment strikes me as being eminently reasonable. I hope that the Minister will not merely say that he is being very kind in giving more information than is usual on such matters, which appears to have been his line throughout the Committee proceedings. It is a new departure for the Government to make industrial schemes and purchase equity shares, as it were, at will as an act of administration rather than as an act of legislation on an ad hoc basis. As I say, I do not agree with the principle but, if that is to be the new departure, at least the same standards of financial correctness should

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      be adhered to as those adopted in the Stock Exchange and between companies making takeovers and mergers.
      I have not had time to study the prospectus which has been issued on the Beagle Aircraft Company, but I do not believe that there is enough information in it for any trained accountant or businessman to make an informed judgment on whether the price paid for Beagle is right, what the prospects of the company are, and what the prospects for a return on the taxpayer's investment will be. It does not give forecasts of future profits or forecasts of future sales, nor tell the history of past profits or losses, nor of past sales. It is not only asset value which one requires. One requires a whole wealth of informed detail about past achievements and future prospects. This must be cross-checked before investment is made and all the information must be made available.
      Mr. Benn: To help me in replying on the Amendment, could the hon. Member answer this question? When he talks of investment, is he referring solely to those cases where some equity holding might be negotiated, or is it his view that the Government can give away money but if there is an expectation of a return on it that is a different matter? His own party gave away tens of millions without any provision being made for any return.
      Mr. Ridley: I am glad that the Minister asked that question because it enables me to make my position clear. By buying equity one enters into a limitless commitment. If one buys the equity one owns the business until one can get rid of it, and it might be for 1,000 years. During that period one is liable to support the losses and to find the new capital of that business—[AN HON. MEMBER: "Nonsense."] It is absolutely true. If the Government are to make loans they can make them on terms and have a purely terminable liability.
      If the Government are to make orders or development contracts they know exactly what they are getting and can make tenders for the work to be done by contractors. In the making of loans and development contracts there is a whole world of difference in financial implications. Before the Government
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      buy the liabilities of companies for years to come the viability of the organisations should be clearly demonstrated and made abundantly clear to all. For that reason I support the Amendment and I hope my hon. Friend will look favourably upon my Amendment to his Amendment.
      Mr. Peter Emery: I support my hon. Friend the Member for Eastleigh (Mr. David Price) on this Amendment. I consider it one of the most important Amendments we shall debate today, because it underlines part of the principle which the Bill sets out to establish. The Amendment seeks to ensure that the Government shall provide the same sort of information on a takeover as the Government would require private industry to make available to the public in general on the takeover of a major company by another company. The Amendment requires the Government to act and live with the same disciplines as the Government want private industry to live with when it is on its own. It is quite wrong for the Government to suggest that there should be one standard for themselves and one for industry.
      4.15 p.m.
      I go a little further into the detail of the way in which I hope the Amendment might be applied. It is not a new idea, not even a new principle because under the I.R.C. procedure the Corporation had an interest in English Electric and Elliot Automation and in the Rootes-Chrysler Corporation link up. A very detailed statement was prepared, not by the Government but by the bankers, Lazards. It set out the sort of information which we are asking that the Government should make available when they are acting, not under the I.R.C. procedure but under this Measure. It seems not unreasonable that this Measure should stipulate that the Government should make this information available.
      It became apparent in Committee that information may be made available during discussion of an Amendment. A considerable amount of new information was suddenly made available with reference to the Beagle Aircraft Company. With all this mass of statistics and economic and financial information we were able to ensure that the Minister would publish a statement. The outcome is the document which has now been made available. The Government have already

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      accepted the difficulties and that this information should be made available, but it is not good enough to have it made available merely when the proposal comes to the House with the draft recommendations which the House could debate. This Amendment asks that the information should be made available at the time of the promulgation of the draft Order. Then, when we deal with it in the House, we can be properly and fully informed of the financial background necessary for the debate.
      In the statements that were produced for the Industrial Reorganisation Corporation on the two mergers of which I have spoken, there were listed in considerable detail a statement of existing business, why the Corporation was considering making the investment, what the profit forecasts were, what were likely to be the dividends in future, and an historical summary, not only of the activities of the two companies involved, but also of the previous Stock Exchange prices, so that people could judge what sort of deal it was. Information as to discount cash flow in the forecast for the future should also be made available.
      A matter which perhaps the Government may consider they are in difficulty over has been made clear by the intervention by the Minister. They see a difficulty between the exact take-over where shares and equities are being purchased and perhaps the sum of over a quarter of a million which may be given in launching aid or by some other method which would not make an exact parallel to that which I have used in my argument. I admit that difficulty. Even so, it does not seem that it would not be possible to have a financial statement showing why the quarter of a million pounds of Government money, even if it were only in launching aid, was made available. That would not be a dividend forecast nor even any decision on the profitability factor, although I would have thought that the d.c.f. rate would be something that the Government would be interested in before making the investment of a quarter of a million pounds available.
      I go along with my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) to a considerable extent. Statements of lower amounts might in
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      some ways be even more important because they can reveal where small sums of money are being given to small organisations which could provide unfair competition between one small firm and another and we would not know anything about it. A new corporation, which I will call "Benn Emery", might be formed. Thirty thousand pounds or £40,000 might be advanced by the Government. Churchill's or another organisation might be able to do all the experimental work at a much more reasonable rate and without a subvention of £33,000 or £40,000 from the Minister. This is why I believe that such information should be given. The aspect of unfair competition is, we must recognise, one of the nasty anomalies which the Bill will create.
      Rather than pressing the Minister for something which I do not believe we have a hope of obtaining, it makes more sense on Report to table an Amendment which coincides nearly with the Ministry's thinking. It was in the hope that we could get the Minister to accept the Amendment that my hon. Friend the Member for Eastleigh left it as the level of £¼ million.
      I believe that there should also be a statement about the industrial relations of the company or companies concerned. In Committee a number of hon. Members opposite made valid points to the effect that it was reasonable in any such takeover that the workpeople should be told what the state of industrial relations was in the companies concerned, what the union activity was, and what the employer/employee relationship had been and might be in the future. This information, too, should be made available to the House. I hope that on this ground alone hon. Members opposite will see the relevance of the Amendment and, if the Government do not accept it, some of the more active trade unionists opposite will support us in the Lobby.
      I repeat that the Amendment sets out to ensure that the Government must make available to the public the same type of information that public corporations when taken over have to make available to their shareholders. If that is not the discipline which we should demand of government, I do not understand what standards the Government require of themselves.
      Mr. Robert Sheldon: I hope that my right hon. Friend will not be dissuaded by some hon. Members opposite from carrying out further developments in the way of assistance on small schemes. I believe that there are a number of ways in which small sums can have a very disproportionate effect, by being brought to bear at the exact point where they are needed.
      One of the most important aspects of the Bill is the need to maintain flexibility during what I consider to be a very innovatory phase and one full of possibilities for success—and for failure. My right hon. Friend will need to be conscious at all times of the importance of his giving as much information to the House as he can. He must give at all times, as far as he is able, information both as to the cost of his schemes and as to the benefit. I interpret "benefit" in the widest possible way. There is the danger that some future Minister—not my right hon. Friend; I know him too well—will use this as a means of propping up inefficient industries. This is a danger of which the House would need always to be fully aware. The other danger—that we may fail to back the right type of industry, because of insufficient experience—is one which I hope that the development of a body of experience will dissipate.
      In providing money at risks there are very great dangers, most of which are known to hon. Members. We have a Government Department with a little experience in this matter, but a need to gain much wider experience. The idea of making use of men outside the Civil Service is admirable. We also need men in Government Departments with a closer understanding of industry and of the way it works. It is unfortunately true that at present in these matters Whitehall does not know best and that it should know much better. It needs to be able to bring such people into the Civil Service, to make use of their abilities, and to cooperate with those who will make the final recommendations. It is in this area that much improvement is necessary and, I believe, possible.
      I have viewed the Bill with increasing hopes over the past few months. There are ways in which it can be used very imaginatively. The advantages which were found to be possible with the
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      N.R.D.C. can arise in increasing measure from the Bill, too.
      On any occasion when the Government are to give money to industry I shall want to be able to decide—and to have the means available to me to enable me to decide—that the Government are right. I shall need very wide, full and frank information to enable me to decide that the Government have acted wisely and are improving their competence in these matters.
      Mr. John Peyton: The hon. Member for Ashton-under-Lyne (Mr. Sheldon) made a very effective speech in favour of the Amendment. He expressed his anxiety, which I share, lest the Bill be used to prop up inefficient industries. This is just one of the things we are worried about. The hon. Gentleman went on to make a belated confession of a fact well known to us, namely, that Whitehall does not know best and that it should know a great deal better. With the latter part of that sentence I agree even more than I do with the former. Whitehall certainly should know a great deal better. If it were to secure to itself the service of the type of omniscient industrialists whose advice, in the hon. Gentleman's opinion, would obviously be valuable, I rather doubt whether a Bill such as this would appear. I believe that those industrialists would probably concentrate their attentions on the tax system under which we labour and would certainly not be prepared to countenance or to support in any way a system the prevailing weakness of which is to shore up inefficiency and to penalise and hold back success.
      I enthusiastically support the Amendment, though I would go along also with my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley), who desired to amend the Amendment. If the Government are to distribute their favours by way of small investments here and there, I see no reason why they should not be called upon to explain matters in detail, because much abuse and many weaknesses could follow from any indiscipline here.
      The Minister, when he interrupted my hon. Friend the Member for Cirencester and Tewkesbury, gave us a glimpse of the character of Socialists. Socialists always expect slavish support for anything

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      that one's own party has done. That doctrine does not go with me. It is not an argument which washes or which ought to wash. Any political party which has not got the modesty to admit from time to time that it makes the most fearful mistakes is not much good. One of my major complaints against the Labour Party—
      Mr. Speaker: Order. We are discussing on the Amendment whether there should be a memorandum.
      Mr. Peyton: I am coming to that almost immediately, Mr. Speaker. What I am concerned about is the doctrine that some political parties are so competent in their judgment that they do not need to make any explanation. This is why there is the need for this modest memorandum.
      For the life of me, I can see nothing objectionable or obnoxious in the Amendment. What do the Government fear? The key words in the Amendment are "informed judgment". If the Minister rejects it, the House will be justified in concluding that the very last thing he wants is an informed judgment and he is at all costs anxious to avoid it. Can this be so? No Minister, so far as I know, has ever stated directly that he would not like an informed judgment to be possible. At certain points in Committee, the right hon. Gentleman himself at least went through the motions of pretending that it would be a good thing if the fullest possible information were given. If he was sincere in those professions, as I have no doubt he was, he has n easy course to take now. He should accept this modest Amendment requiring an accompanying memorandum giving the facts necessary for the formation of an informed judgment. What in the name of conscience could be the objection to that?
      4.30 p.m.
      Mr. Ridley: These are the Minister's words in Committee:
      "…I shall arrange for a duplicated memorandum to be produced. It will not be very long. The Committee will understand that this is done under the old procedure. We hope to do better in future with projects which come under the Bill. I shall do my best to see what can be made available."—[OFFICIAL REPORT, Standing Committee E, 14th March, 1968; c. 407.]
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      The right hon. Gentleman met the point the whole way. I see no reason why he should not meet it in practical terms now.
      Mr. Peyton: I am obliged for that helpful intervention. That is the sort of remark made by the Minister to which I referred and on which I base my hope that he will accept this modest Amendment. Yet one's experience in this place forces one to believe that Ministers do not wish to waste time or hear unnecessary arguments, so that, had it been in his mind to accept the Amendment, he would, I imagine, have leapt to his feet, as soon as it had been moved, to say that he intended to accept it. That would have given force to the words which he himself used in Committee and which my hon. Friend has very properly quoted.
      We want information and material on which we can check the judgment of the Treasury and Ministers. I know, from a cursory reading of the proceedings in Committee, that the right hon. Gentleman has a good deal of confidence in Treasury judgment, and I dare say he has a good deal of confidence in his own, too. My hon. Friend the Member for Acton (Mr. Kenneth Baker), who is sitting just below me, will be able to tell the right hon. Gentleman that that is not a view which is widely shared throughout the country. Confidence in the Government is not high.
      We should be comforted a little on this side if the right hon. Gentleman would rise at the end of this brief debate and tell us that he was overwhelmed not only by the power of the arguments which have been mobilised but by the force of what he himself had said in Committee, and that he would allow the Amendment to be incorporated in the Bill. In so doing, he would dislodge the fearful suspicion which is now dawning in some people's minds that the last thing the Government want is an informed judgment.
      Sir Gerald Nabarro: I support the Amendment as proposed to be amended by my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley). For my part, I would not lend a penny to this Government or any other for the purpose of acquiring industrial, trading or commercial enterprises. The great British public has been bamboozled during the past

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      12 months by the title of this Measure, the Industrial Expansion Bill. It ought to be called the Proliferation of Nationalisation Bill.
      Mr. Stanley Orme: I wish it were.
      Sir G. Nabarro: Yes, the Left wing of the Labour Party, which fervently believes in Clause Four—the nationalisation of all the means of production, distribution and exchange—would prefer the title I have postulated. However, I shall not explore that avenue. It would be out of order on this Amendment, and I shall not be led out of order and into such matters by the Left wing of the Government party. I have postulated what I regard as the true title of the Bill.
      The Amendment is designed simply to require a proper company prospectus to be laid before the House of Commons. It would be illegal under our company law for any offer to be made to the investing public in a newspaper or journal without the provision of comprehensive financial and historical details of the enterprise, to be acquired by the shareholding public. We are all acquainted with the form of such prospectuses. They include details as to the history of the enterprise, its products, its assets, its prospects, its profit record, its depreciation principles and policies, its export performance, its board of directors, its bankers, its legal advisers and auditors—a mass of detail. Even the smallest public issue often occupies a full-page advertisement in the Financial Times, in very small print.
      We are all acquainted with that practice. It is a safeguard for the investing public. The only real safeguard for the investing public in the context of this Bill, however, is the perspicacity, intelligence and industry of Members of the House of Commons. It is no good the hon. Gentleman the Member for Westhoughton (Mr. J. T. Price) nodding his head in dissent—
      Mr. J. T. Price rose—
      Sir G. Nabarro: I shall give way in a moment, when I have finished my sentence. It is no good his nodding dissent. Why would he be less scrupulous
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      with a public enterprise than with a private enterprise? Perhaps he will answer that.
      Mr. J. T. Price: As the hon. Gentleman has been good enough to give way, I shall try to answer his rhetorical question.
      Sir G. Nabarro: It was not rhetorical.
      Mr. Price: I have been asked why would I be less scrupulous than private enterprise in administering public enterprise. With great respect to the hon. Gentleman, and his lecture on company law, my record of being scrupulous is at least as good as his. Moreover, whether companies carry public money or not, if they are registered companies they are still liable to the company law of the land, as amended last year.
      Sir G. Nabarro: I do not dispute any of that. What I am saying—this is indubitable—is that private enterprise is disciplined by the profit motive. Public enterprise is not. Public enterprise can lose hundreds of millions of pounds, and the deficit will ultimately be written off by the House of Commons, at the expense of taxpayers. Does anyone deny that?
      Mr. Eric Moorman: Will the hon. Gentleman give way?
      Sir G. Nabarro: When I have finished what I am saying. Does anyone deny that statement? I should go too far from the Amendment if I pointed to £400 million-plus written off as the accumulated losses of the Coal Board.
      Mr. Herbert Butler: What about Savundra?
      Sir G. Nabarro: That was a swindle, and Savundra was prosecuted and went to prison for swindle. I hope that no parallel case occurs in nationalised industries. But I am digressing. I am rising to hon. Members opposite.
      What I am trying to demonstrate to the hon. Member for Billericay (Mr. Moonman) and others is that standards observed in private industry should be matched by nationalised industry. The hon. Member for Billericay will agree, and if they are so matched then the newly nationalised industries under the Bill—because that is what they are; they are State acquisitions wholly or in part—should conform to the same stringent

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      standards as are imposed on private industry, which is required to publish fully authenticated and voluminous, copious financial and historical detail when the great investing public is invited to purchase shares.
      Mr. Moonman: I shall not take the hon. Gentleman down any devious alleyway. He raised the question whether the same standards would apply in public enterprise. I remind him that in the amended Bill we now see the word "profitability". The question of the efficiency and profitability of an industry is now in the Bill, and I should have thought that that answers the hon. Gentleman's point.
      Sir G. Nabarro: It does not. It does not satisfy me in the depth I require to judge the future of the industries to be nationalised. Clause 1(2) states:
      '…a draft of the scheme has been laid before Parliament and approved by resolution of the House of Commons."
      Mr. Orme rose—
      Sir G. Nabarro: Do let me get on. I shall give way in a moment. That draft scheme laid before the House could be 50 words. It could be just a pottage of legal jargon and could give none of the comprehensive information I seek. I give way to the hon. Gentleman once more.
      Mr. Orme: This is a very important point. I am following the hon. Gentleman's argument very closely, but when he talks about accountability and shareholders being consulted I wonder how many individual shareholders were consulted about G.E.C.—A.E.I. take-over. Is not it a question these days of shares being in huge blocks within the control of huge organisations and the small shareholder not being consulted at all?
      Sir G. Nabarro: I am sorry to disappoint the hon. Gentleman. He must go away and try to learn the rudiments of British company law. Every shareholder is consulted before a take-over of that kind is completed. The offer is published in the public Press and on a given date it will "go unconditional", as it is called. In the interim period all the shareholders are consulted. Any acquisition of a publicly quoted company by another is subject to the approval of shareholders under company law. The
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      hon. Gentleman must not argue about matters of which he has not even the tiniest knowledge.
      I want to address to the right hon. Gentleman the Minister of Technology a few arguments which I hope he will appreciate, as he sat through most of them in the House, have great relevance to my hon. Friend's Amendment. He will be aware that between 1947, the year of the first of the post-war nationalisation ventures, namely in coal, and 1967, 20 years later, every part of the House was learning painfully how to deal with the exceedingly complex problem of the accountability of nationalised industries. I am glad that the right hon. Gentleman nods assent at once.
      We were all in it together. The Labour Party, when on this side of the House, was even stronger in supporting me when I sat on the benches opposite through the early 1950s than were my Tory colleagues. I had to divide the House again and again against Tory Governments on the issue of securing proper accountability for nationalised industries. When Mr. Aubrey Jones was the Minister of Fuel and Power in 1956 I took a mixed bag of 40 or 50 hon. Members of all parties into the Lobby against my own Government on the issue of the amount of information with which we should be furnished annually in the House, to assess accurately—
      Mr. Peyton rose—
      Sir G. Nabarro: May I just finish? My hon. Friend never gives way to me. I shall give way when I have finished this sentence, or perhaps a paragraph more.
      4.45 p.m.
      In 1956 we had to divide against the then Government on the specific point of being furnished in the House with adequate annual information concerning the nationalised industries, and the real nub of the argument was that without the information, or without these data once or twice a year, we could not assess reliably the profit prospects for the industries, and the sum of money we should vote annually for capital investment. The position is exactly the same here with my hon. Friend's Amendment. Unless we are given comprehensive information under the various headings I suggested, none of us can assess the future prospects of the industry.
      Mr. Peyton: The moment has rather passed, but I was about to say that my hon. Friend was confusing autobiography with history, and to suggest to him that if he sometimes used the first person plural as an alternative to the first person singular it would be more accurate.
      Sir G. Nabarro: My hon. Friend is historically extremely inaccurate. On the occasion when we were on the opposite side of the House when he said, "Not I,"—addressing his comment to me, for I used the term—"but we", because his name was after mine on the Order Paper, we were arguing about steel loans. I am alluding to the incident in 1956, which is four years earlier, when my hon. Friend the Member for Yeovil did not join me in the Lobby.
      Mr. Benn: On a point of order. I do not want to prevent this, but we appear to have two hon. Members giving a preview of their autobiographies which has very little bearing on whether the House should know anything about the schemes.
      Sir G. Nabarro: Autobiographical or historical, my hon. Friend the Member for Yeovil has forgotten the facts.
      Mr. Cyril Bence: The hon. Gentleman was a junior Minister.
      Sir G. Nabarro: He was not a junior Minister until 1962.
      I am now coming to the end of the 20 years in 1967. The culminating point in the campaign to get proper information was the publication by the present Government of Command Paper No. 3437, "Nationalised Industries: A Review of Economic and Financial Objectives". These are the disciplines the right hon. Gentleman should observe in creating new nationalised industries. He was a part of the Administration which published those economic and financial objectives. Why does he object to these desiderata being applied to newly nationalised industries, or are they to be applied only to industries nationalised pre-1967 and not post-1967? I hope that the right hon. Gentleman will answer that, because Command Paper 3437 is quite specific. Paragraph 2 says:
      "The statutory duties of nationalised industries are set out in the nationalisation Acts. Broadly they are to meet the demand for
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      their products and services in the most efficient way and to conduct their finances so that over time they at least break even, after making a contribution to reserves."
      In paragraph 6 the following pregnant words are used:
      "Investment is fundamental to economic growth and largely determines the way in which industries develop."
      It then goes on with delineation of a large number of economic disciplines which I shall not repeat. But what I shall repeat is the fundamental of the whole of this vitally important Command Paper, to be found on page 16, for here the financial objectives of the nationalised industries are set out, as they should be, of course, quite properly. It sets out the net returns on capital employed in each of these industries. But see how they vary.
      The Post Office, 8 per cent.; the National Coal Board, to break even after interest and depreciation; the electricity boards, 12·4 per cent.; the South of Scotland Electricity Board, 12·4 per cent.; the gas boards, 10·2 per cent.; B.E.A., 6 per cent.; and so on. Every industry has a different financial objective. How are we to tell when industries, newly to be nationalised, under this Bill—for that is the circumstance—
      Mr. William Small: Nothing of the kind.
      Sir G. Nabarro: They are newly nationalised industries. Of course they are. They are nothing else.
      Mr. Small: No.
      Sir G. Nabarro: We will, I hope, deal with these differences on a later Clause, but my interpretation of the Bill, and, I hope, the interpretation of every Tory Member, is that this is a proliferation and an extension of nationalisation—nothing else.
      Before I can judge whether an industry ought to be nationalised—although politically I think that no additional industry ought to be nationalised—before I can judge the financial position and profit prospects of what is to be nationalised, I must have applied all the disciplines and all the desiderata set down in Command Paper 3437, without which I should not be able to form a reliable judgment.
      Mr. Ridley: It may be that, after last Thursday night's traumatic events, the

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      hon. Member for Glasgow, Scotstoun (Mr. Small) is trying to deny that nationalisation is the basis of the Bill because lie knows that it is jolly unpopular and lie is quite ashamed of it.
      Sir G. Nabarro: I must leave the hon. Member for "Scotstown" to his conscience.
      Mr. George Willis: The hon. Gentleman does not even know how to pronounce it.
      Sir G. Nabarro: "Scotstoon", then. I am not a Scot but a Sassenach and "Scotstown" is good enough for me. But I must not digress. For all the reasons I have explained, I hope that my right hon. and hon. Friends will vote powerfully in support of the Amendment as amended, because I believe that every scheme under this Bill, be it costing £10 or £10,000, ought to come before this House. I am pledged as a Conservative politician to oppose every additional measure of nationalisation and £10 to me is a substantial sum of money especially when misapplied in additional public ownership.
      Mr. Small: We all know that the hon. Member for Worcestershire, South (Sir G. Nabarro) will never travel incognito. We have had that malicious, emotive use of the word "nationalisation" as portraying a compulsory element in the Bill which it does not possess. The hon. Gentleman entertains and sometimes in Forms the House, so perhaps he will tell us where he finds any compulsory element in the Bill. But it does not exist. The ground rule in the Bill is an accommodation between Government and industry, based on equality of information, whereby they can make a matching arrangement for launching agreements in open covenant in a draft scheme approved by the Treasury and laid before this House. It will all be in the open.
      We all recall the old Ministry of Aviation and the millions of £s handed over to the aviation industry in arrangements which never saw the light of day in this House. I do not want to be too malicious, but I would remind the House of some of the things which went on. I recall the Ferranti affair, which many of us described as the "gravy train". A
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      later case was that of Bristol Siddeley. Some of my colleagues in the engineering industry say "Make an arrangement with the Government and you get the lolly, boys."
      We would not have got Wiggins Teape in Scotland with the attitude of the hon. Member for Worcestershire, South. This Bill is designed to modernise practices in an absolutely legitimate manner in terms of information afforded to hon. Members. The arrangements will be permissive. There will be no compulsion. The arrangements will be arrived at on a voluntary basis and the hon. Member for Worcestershire, South should not be suspicious and mislead others by giving the appearance of being a well informed industrial intellectual in his own right.
      Mr. David Lane: We are debating this Bill in an atmosphere of genuine and widespread public anxiety about the growth of public expenditure. I am not saying that to make a party point but because it seems to me to make it all the more important that we should lean over backwards in appraising legislation which is to open up fresh fields for public expenditure and in making sure that the House is as fully informed as possible.
      I support the Amendment because I was exceedingly disappointed by the unconvincing attitude of the Government during the Committee stage. The Minister said several times, in one of those fine phrases we so much enjoy from him, that part of that objective is to bring Parliament into play. But it seems to me that, unless we can improve the Bill at this stage, it will be like inviting a friend to take part in a cricket match and then sending him in to bat left-handed with a child's bat and one arm tied behind his back.
      It is only open to the House to accept or reject but not to amend a draft Scheme. The least we can do is to put a firm obligation on the Government to give at least a minimum of information to the House on the lines suggested by the Amendment. When discussing this point in Committee, the Minister said:
      "…in big schemes it is manifest that we would want to make available to the House an idea of the scheme, and the debates on it would no doubt be full and complete."—[OFFICIAL REPORT, Standing Committee E, 15th February, 1968; c. 18.]

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      But how can we have full and complete debates on this unless we have the certainty of full and complete information? Undertakings given in Committee, and which may be repeated today, are not quite enough in this case. We must write a clear commitment into the Bill itself. The public sector must set an example to the private sector by the amount of information which it makes available before decisions are taken, and this is all the more important when public and not private money is involved.
      My hon. Friend the Member for Eastleigh (Mr. David Price) said that he had not written in the Amendment an exhaustive shopping list of all the things which he wanted to be set out in the memorandum. I should like to stress one factor which is already partly covered—the importance of market analyses, market forecasts. I hope that we shall have the Government with us in this, because several times in Committee the Government stressed that it was no good producing an excellent product if there was no market for it.
      I hope that there will be no quibbling or legalistic objections to the Amendment. If the Government do not accept it, or something on its lines, they will confirm our suspicions that, for all the fine words of the right hon. Gentleman, here is another example of the Government treating the House of Commons with contempt.
      5.0 p.m.
      Mr. Tom Boardman: I support the Amendment. Like every other hon. Member who has spoken, with the possible exception of the hon. Member for Glasgow, Scotstoun (Mr. Small)—I can pronounce it "Scotstoon", because I am 50 per cent. Scots—I think that we should not have two standards of information available to the investing public, and that is what would result from the Bill as drafted. There is a standard rightly required by the House and the country as a whole for those who invest in public companies through the Stock Exchange and their brokers and so on. Here we are required to have a separate standard for those members of the public who, by paying their taxes, place their money in the hands of the Government to invest. As shown last Thursday, the public does not
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      have much confidence in the Government to act as the Government, let alone as stockbrokers. Why should we have two standards of information? Why cannot we have precisely the same amount of information as is required if a person invests through his broker with expert professional advice, having this information before any public money is put into any industrial scheme?
      The hon. Member for Scotstoun said that there was no compulsion, but I agree with my hon. Friend the Member for Worcestershire, South (Sir G. Narbarro) that this is a Bill for nationalisation. There is also compulsion in that those who pay their taxes and thus provide the money have no option about whether it is put into any scheme. We in this House are the sole guardians of that. I am not arguing on behalf of the companies into which the money will go, but for those who provide the money and who look to us to provide the safeguards and checks and controls, the very control of which the Minister spoke on the Second Reading when he said that Parliament would have more direct control over the money. If we are to have the control which we must have, we need sufficient information to exercise it properly.
      We must not stop with the information which would be required for investment through the Stock Exchange, investment in new issues and so on. We need more information than that, because when public money is put into a scheme, other considerations must be relevant. For instance, the consequences of such a scheme involve a degree of subsidy and we should be told what the extent of the subsidy is and who in competing lines of business will be affected.
      I join with my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) in saying that, if the amount involved is of sufficient significance for it to be included in an industrial scheme, the House should be given the information so as to make an informed judgment. But rather than give the Minister the excuse that that would mean going into unnecessary details and making his task imposible—although it would be an excuse which I would not accept—I am prepared to support the Amendment applying the limit of £250,000.
      Mr. Bence: I have been amazed by some of the speeches from the Opposition this afternoon. During our 13 years in opposition we regularly asked the Board of Trade why grants had been refused to companies setting up in development areas, and we were always told by Conservative Presidents of the Board of Trade that it was not the practice to reveal the business of private companies applying to the Board of Trade. We were always told that the Board of Trade Advisory Committee had examined the matter. Now those very hon. Members who wholesale supported their Government in refusing us that information demand that the affairs of any limited liability company should be revealed to the House of Commons. I shall take the earliest opportunity to associate my few business friends with the information that the new Conservative Party demands that the private affairs of Wiggins Teape and B M.C. and Rootes at Linwood and the hundreds of other companies which in the last 15 years have had Government aid of all kinds should be made public.
      Mr. Tom Boardman: Is the hon. Gentleman aware of the full and detailed in formation which every company has to publish in its accounts? We have not been promised even that amount of information.
      Mr. Bence: I was about to deal with the amount of information supplied to investors. I do not know how many business men among hon. Members opposite have ben caught, but in the last 50 years many people have been caught by making investments in companies which have quickly "gone bust". Only recently some people have gone to gaol for issuing false information. I sometimes wonder whether the very able people to whom I might entrust funds for investment are as able as I believe them to be. When I read reports in The Financial Times of various carryings on and of the issuing of false prospectuses, I wonder whether I would not be better investing all my money in Government Development Bonds rather than bothering about going to the Stock Exchange, especially when half-a-dozen people have gone to gaol recently for issuing false information. I have never heard of a Minister of State going to gaol. Ministers are never accused of false pretences. The information pub
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      lished by limited liability companies is very slight.
      Mr. Sheldon: I am sure that my hon. Friend will be aware that the practice was common a few years ago, and probably still exists, for many public companies to present their chairman's annual report and for the reader to be unable to find out what the industry concerned was.
      Mr. Bence: Friends of mine have investment income from companies and yet do not know what those companies manufacture, and some of them do not know where the companies are. One of these companies is quoted on the Stock market—Hector Whaling. Some of my friends thought that it was connected with whaling in the South Atlantic, but it has not been engaged in whaling for a hundred years.
      Hon. Members opposite demand that the Government should reveal the affairs of any private company with which they have dealings.
      One should accept the capacity of the Board of Trade Advisory Committee and the Treasury, together with the integrity of the Civil Service, to examine the situation to see whether assistance is justified. This kind of demand is opposition of a despicable kind, because it is not genuine. Every hon. Gentleman opposite is talking with his tongue in his cheek, and he knows it. It is opposition for the sake of opposition. It is pure humbug and does not make sense. I am sure that no one on the Front Bench opposite can justify the demand that no aid of any kind should be given to a company. We are to advance £70 million to Rolls Royce to enable it to support the greatest achievement of any company in this country in the last 100 years. This is a terrific break-through. Are we to demand that all the accounts and affairs of Rolls Royce should be produced before we finance production?
      Sir G. Nabarro: The Rolls Royce accounts are published in detail every year, in accordance with the Companies Act. They need not be presented to the House. We are talking about companies to be acquired when no accounts will be presented to the House.
      Mr. Bence: These are not companies to be acquired. The hon. Gentleman has made my point. Any limited liability company which will receive any grant or

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      aid from the Government will be a company which will have published its report. It has to publish a report, and will already have done so in the limited area in which it is operating. Every detail is not included in the Rolls Royce accounts. I hate to call it a detailed document. This is nonsense. There is a lot of information in it, and there may be sufficient for one who wants to invest in the company, but it is not a fully detailed information of the business. Any public company has to publish that information, why ask for more?
      Mr. Peyton: Has the hon. Member read the Amendment? I am not sure whether he was in the House when it was moved. He will see that the Amendment is asking for the statement of facts necessary to make an informed judgment. That is all. Is the hon. Gentleman saying that an informed judgment is undesirable?
      Mr. Bence: Not at all. In my view, some of the events of the last 10 years have shown that a lot of stockbrokers and investors are very inexpert in making an informed judgment on how they invest funds. We had a great national bank investing £4 million in pigs in Glenrothes. This was one of our leading Scottish commercial institutions which invested in Cadco. Its judgment must have been pretty bad. Knowing my right hon. Friend I do not believe that he would lend £4 million to Cadco to breed pigs. I would rather have his judgment than those who judged that this was a reasonable investment. No one has made a case that the ordinary investor is in a better position to judge from the information available to him than my right hon. Friend.
      Mr. Emery: I do not believe that the hon. Member was in the House when I spoke about this Amendment. Would he not agree that it is right for this side of the House to demand that the same degree of information is made available by the Government when take-overs are made as the Government require industry to make available when public companies are making take-overs? Is it not right that there should be the same standard of behaviour?
      Mr. Bence: The accounts of any public company involved will be published. One can acquire these accounts. There is
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      no need to put this in the Amendment. In the discussion going on between companies, factors are revealed which would not be in any public accounts or prospectus. One cannot ask any Government Department, just as we could not ask B.O.T.A.C. to reveal every position of a company. Hon. Gentleman know very well that B.O.T.A.C. and the Government on behalf of B.O.T.A.C.—when there was a Conservative Government—refused to give any details beyond what was published in the company accounts. This is sheer, unreasonable humbug. It is nonsense to demand every detail from every private company.
      5.15 p.m.
      Sir Tatton Brinton: A number of my hon. Friends seem to be puzzled as to why the Government are not prepared to accept this Amendment providing a large amount of information for this House. I can enlighten them. If they will look at page 2 of the Bill, under Clause 2 they will see that financial assistance is to be given in circumstances where it would not be undertaken:
      "…without such financial support as is authorised by this Section."
      In other words, the ordinary sources of finance are not available.
      The suspicions which my hon. Friends and I have about the Bill are amply confirmed by the attitude of the Government towards this Amendment. We believe that they are seeking enormously wide powers to use public money for an enormous variety of purposes. They are unwilling to accept any plan to furnish more than minimal information, because they intend to use the powers in the Bill in ways which may go well outside the demands of any commercial consideration. It is up to the Government to disprove our suspicions by accepting the Amendment.
      We have no definition as to what the draft Scheme will contain. It may be a very bald document which merely says that a competent authority has considered it politic to invest an enormous sum of our money in some enterprise—it might even be a new groundnut scheme—which the competent authority is satisfied would provide us with a strategic, social, or even some commercial advantage. They will not give us any definition, because they say it would not be good for us. That is what this amounts to.

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      When we seek to introduce what is surely the most reasonable Amendment in the world demanding some definition as to the sort of information to be contained in or added to a draft scheme we are told: "Go away, it is not good for you to know."
      It is a matter of great concern to many people inside the House and outside of it that its powers are being steadily eroded. Here is another example of this. From the drafting of the Bill it is obvious that it has many purposes besides that given in the Title—which I denied by an Amendment I moved in Committee—to expand industry. It has many other purposes and one of them as we know well, is to satisfy the demand inside the Labour Party, at its conference and National Executive Committee level and from a number of hon. Gentlemen sitting below the Gangway, to carry on with Clause IV and nationalise everything in sight. This is a compromise Bill, we know that. The nation has a right, if the Government have to stagger on for at least a few more months, to demand that in satisfying the Left wing the Government should also satisfy the House that they are putting forward some arguable case for their proposal.
      I have no doubt that the Government have no intention of doing anything else other than making this an enabling Bill with sweeping powers. I hope to point to a case where they have vastly extended the already wide powers contained in the Bill. The Government intend the Bill to do almost anything in almost any enterprise, with almost any amount of money, with the minimum of Parliamentary supervision.
      Mr. Willis: We have had a lot of hypocrasy and humbug in this debate. If any question is raised in the House about revealing matters affecting private companies, it comes from hon. Members opposite. One has only to be present at Question Time when Questions are put to the Chancellor of the Exchequer to know the furious demands which the Opposition make that nothing private should be made public. This happens week after week, and on Bill after Bill.
      I remember the Highlands and Islands Bill, for which I was responsible. The Clause which was fought most vigorously by the Opposition was the Clause which allowed the Board to obtain information
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      from private firms. More nonsense was talked about that Clause than on any other part of the Bill.
      Mr. Peyton: I think that the right hon. Gentleman is another latecomer to the argument. What we are complaining about is that the Government are proposing to invest public money, and our Amendment seeks to ensure that such material and information is made available to allow an informed judgment to be made. It is a very modest request. The right hon. Gentleman is way off the target. Even his capacity is not sufficient to get him on the target.
      Mr. Willis: I am quite capable of taking time to explain what I mean.
      May I remind hon. Members of some of the Bills which we have passed? There was £20 million or more for the Cunard Company. I do not know that we heard any special emphasis on profit forecasts during the passage of that Bill. In fact, most hon. Members doubted whether the concern could be profitable, but they thought it necessary for other reasons. How much did the steel firm in Motherwell get for the tin plate mill—£40 million. I do not remember any forecasts about profitability being made in that connection. As I understand it, the concern has made hardly any profit. It has not been profitable. But it was necessary as a social development.
      There was a special Bill for Wiggins Teape which involved £12 million. Who forecast the profits which Wiggins Teape would make from the pulp mill? Nobody. No spokesman for the Conservative Government told us anything about that.
      Mr. Bence: What about Rootes at Linwood?
      Mr. Willis: Hon. and right hon. Members opposite were sitting on the Government Front Bench at the time, but nothing was said about profitability.
      Mr. J. Bruce-Gardyne: Does the right hon. Gentleman grasp the distinction between prior charge capital and equity capital?
      Mr. Willis: The hon. Gentleman is trying to confuse the issue. All that I am saying is that hon. and right hon. Members opposite asked us to pass Bills—and in this Bill we are asked to pass schemes—which did not call for the information

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      which is asked for in this Amendment. I have quoted specific examples. The hon. Member for South Angus (Mr. Bruce-Gardyne) was not a Member of the House when these Bills were passed, but I can assure him that none of the information for which the Amendment asks was called for in those Bills. We got no more information than my right hon. Friend the Minister will give in his schemes.
      Mr. Benn: The House will get far more information under this Bill upon which to make a decision than was given in the Wiggins Teape Bill, which was passed before the House knew anything about the negotiations.
      Mr. Willis: I am always very modest in my claims, and in my indictment of the Opposition. I am a magnanimous person. I do not like to whip the Opposition too much. I simply state the facts modestly; I do not exaggerate them. But the plain fact is that hon. Members opposite, when they were in government, time and again put forward schemes, which were passed by the House, which did not call for any of this information.
      The hon. Member for Yeovil (Mr. Peyton) raised a question with which I should deal. The Amendment proposes that
      "…there shall be an accompanying memorandum stating all the facts necessary for the formation of an informed judgment as to the merits or demerits…"
      We shall get this in the same way as we got it when right hon. and hon. Members opposite were in office, except that instead of having a Bill we shall have a Motion to approve. That is the difference.
      Mr. Lane: The right hon. Gentleman keeps harping on and past history. He is talking about Bills in the past. We are talking about schemes in the future. The point which I tried to make was that we have no opportunity to amend schemes, which is why we want full information to be given. Bills can be amended.
      Mr. Willis: The scheme can be turned down if the Opposition do not like it. They are avid pursuers of Government waste. They should table a few Questions asking how much has been received on the loans made for Colvilles strip mill.
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      The Opposition are always chasing up waste of Government money. Let them table Questions and find out how much they wasted in financial terms, and, not, I believe, in wider terms, and what return we have received on the money. The schemes will be subject to the usual rules and will be debatable in the House. I have no doubt that the necessary information will be given when they come before us.
      I cannot see that there is anything wrong about what the Government propose. It is general practice not to reveal private business information. I do not even know what the Amendment means. [HON. MEMBERS: "That is obvious."] It states that:
      "…there shall be an accompanying memorandum stating all the facts necessary for the formation of an informed judgment…".
      Who decides what are "all the facts necessary"? What does that mean?
      Sir G. Nabarro: I gave six headings for facts which were necessary, with the approbation of all of my right hon. and hon. Friends: the history of the concern; the products of the concern; the profit record of the concern; the assets of the concern and its depreciation policy; the prospects of the concern; and the export performance of the concern.
      Mr. Willis: As a result of reading the Press of recent weeks, I have lost my faith in the hon. Gentleman as a businessman. I have completely lost any trust that I had in his business judgment. He talked about desiderata. He should know about desiderata. He has received a substantial one, I understand, as a result of his incompetence. Therefore, he is the last one to talk about the Government or other people.
      The hon. Member for Worcestershire, South (Sir G. Nabarro) has given us his list. It might have been acclaimed by hon. Members opposite. No doubt my hon. Friends could give their list. I could give my list. We could all give lists of what we consider to be
      "all the facts necessary for the formation of an informed judgment…".
      Mr. Emery: Does the right hon. Gentleman realise that this is exactly the wording which the Stock Exchange Council uses concerning the information which shall be available on take-over bids

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      concerning private and public companies? It is therefore a known phrase. II is not just made up. It is an established phrase.
      5.30 p.m.
      Mr. Willis: I am not greatly impressed by that either. I live among lawyers. I listen to their arguments in this Chamber, and in the Scottish Grand Committee. If two or three lawyers were to get together to decide what facts were necessary, it would take about a week to determine what this phrase means. It is ambiguous, and nobody knows what it means.
      This is a piece of nonsense on the part of the Opposition. This is a piece of humbug. They are trying to kid the electorate that they are concerned about the spending of public money, while all the time they have their hands dug deeply into the public purse. They want to convince people that they are concerned about public expenditure, and do not want to see money wasted. Nobody wants to see public money wasted.
      Is this good House of Commons practice? If it is not, hon. Gentlemen opposite have been guilty of exceedingly bad practice for many years. I should like to see them turn over a new leaf, but I doubt whether they will. I think that what my right hon. Friend is proposing is fair and reasonable. He will make a statement. He will give us this information to the extent that it can be given. This seems reasonable. If we as a House of Commons do not like it, we can defeat it. What is more reasonable than that? Hon. Gentlemen opposite are asking that the House of Commons should count for something. Here they have an opportunity of making it to do just that, because they can use their power and their influence to defeat the scheme if it is not a good one. I hope that my right hon. Friend will reject the Amendment.
      Mr. Stephen Hastings: The right hon. Member for Edinburgh, East (Mr. Willis) is essentially on a false point, just as his hon. Friend the Member for Dunbartonshire, East (Mr. Bence) was. I thought that the right hon. Gentleman was bowled out halfway through his innings by a fast ball from my hon. Friend the Member for South Angus (Mr. Bruce-Gardyne). He ought
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      to have been back in the pavilion long ago.
      I have great respect for the hon. Member for Dunbartonshire, East, and I enjoy his speeches. I do not want to see him come to any harm, someone ought to take him aside and explain how bookmakers operate, because if he thinks that he will do better with Government bonds than with any other kind of investment, he would do better to take up horse racing.
      The right hon. Member for Edinburgh, East, is saying that we object to information being made available in respect of private companies. This is not the point at issue. It is a question of raising money, and in this case it is a question of raising public money which ought to be controlled by Parliament, money that is the property of the constituents of all hon. Gentlemen opposite.
      If a company has to raise money in the market, or from a bank, surely hon. Gentlemen opposite know that it has to make available a mass of information. If someone wants to get a new issue underwritten in the City, he has to prove his point. If someone goes to a bank to raise money for a new project in industry, he has to make information available in the greatest detail. We are saying that if the Government want the right to use public money for projects of this kind, they should be prepared to make available enough information at least for Parliament to judge whether it is a sensible investment.
      I was originally provoked into intervening in this debate by the remarks of the hon. Member for Glasgow, Scotstoun (Mr. Small), which I did not take too happily, but the more I listened to the speeches of my hon. Friends, and to the spurious defence of the Government from hon. Gentlemen opposite, the more suspicious I became about this Clause.
      As one of my hon. Friends said, this is a very short, modest Amendment. It is asking for a little basic information. Why is it that the Government are so coy about it all? What lies behind it? I was not a Member of the Standing Committee, but the more one listens to the debate, the more suspicious one becomes, and it is the right hon. Gentleman's duty to explain why he will not accept it. Its non-acceptance is totally inexplicable.

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      The hon. Member for Scotstoun referred to the Ferranti and Bristol Siddeley cases. I should like to say something about them within the context of this short debate. Whatever the hon. Gentleman wishes to say, or would like to advance on these two cases, he will surely admit, as any hon. Gentleman opposite would, that part at least of the blame for any mistakes which there may have been lies at the gate of the Government's estimators, and these are not the only cases. We know that in dealing with industrial projects of this nature, immense mistakes have been made on the Government side.
      Under this Clause we are to give carte blanche to officials and Ministers, who have been guilty of massive misjudgments and misunderstandings of what was at stake commercially in big contracts, to invest money willy-nilly all over industry. We do not believe that they have the competence or the experience to do it. We are convinced that if this proposal is allowed to go forward without a minimum of information being available, we shall lose our money.
      Mr. Small: The basis of the Ferranti and Bristol Siddeley affairs was the assumption by the Government that there was equality of information laid before them, and that they were not taken to the races.
      Mr. Hastings: Equality of information is a deep subject in itself. The fact is that over many years the relationship between industry and the Government has deteriorated to such a pass that it is a sort of permanent conflict between the two, whereas it ought to be something different. How has this arisen? It has arisen partly for commercial reasons, and partly because the officials concerned, for all their many undoubted qualities of integrity, and so on, have not proved competent to deal with contracts of this complexity and commercial nature.
      Mr. Benn: Before the hon. Gentleman goes any further with that, will he reflect on what he is saying? In the Wilson Committee's Report, which we shall be debating later, Wilson reported that the firm had deliberately misled civil servants with false figures. If there was a failure to detect, this was due not to a
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      lack of competence but to an excess of trust. If the hon. Gentleman pursues this, he will get himself into very deep water indeed.
      Mr. Hastings: I do not wish to pursue it any further, but the right hon. Gentleman will surely not pretend to anyone that the Wilson Report will be universally admitted and accepted, or indeed that all the figures in it are necessarily accurate. If the right hon. Gentleman asks me to wait until the debate, I can say the same to him, because there is plenty that can be said on that report on both sides. It comes ill from the right hon. Gentleman, as the Minister principally responsible for an industry which he is supposed to be encouraging, to leap to the attack behind the Wilson Report. I think that his attitude should be much more circumspect.
      I am not making accusations of anything disgraceful or anything that is not understandable. I am saying that by experience and background officials in the Whitehall machine are not necessarily best qualified to make complicated commercial judgments as well as the technical judgments which are required to justify the kind of investment which the right hon. Gentleman wants to make under this clause with public money. The record is there to prove that there is a great deal of weight behind this argument.
      If that point is taken, it seems to strengthen the argument for at least a little frankness, and I cannot see any justification for this eminently reasonable Amendment being squashed and sat upon at the outset of the debate. It would be easy to accept it. It would not involve a lot of work, but merely the answers to some simple basic questions on matters about which any banker or any underwriter would want to be satisfied before he made available a penny of the money for which he was responsible. Why are the Government by contrast prepared to be so profligate with public money?
      Mr. Benn: When the hon. Member for Mid-Bedfordshire (Mr. Hastings) reflects on his speech I believe that it will shock him. He raised the question of Bristol Siddeley, with which I must deal before coming to the Amendment. His argument was that because civil servants had been deceived in this case by being given

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      figures that did not relate to the hours worked in the firm—this is what Wilson said, and he published the figures to prove it—the Government are not, for that reason, able to engage in a commercial relationship with a firm unless information is published.
      If information is published and the same thing is done by a firm—in relation to the old Ministry of Aviation—then, from the point of view of the House of Commons, how much better off would we be? All relations between Government and industry depend on being able to believe the word of the people with whom one is dealing. It would be just as wrong for me to deduce from this episode, or to impart, a general attack on industry, as it is for the hon. Gentleman to make it a general attack on Government.
      In any event, since the hon. Gentleman h is some experience of the aircraft industry, I was waiting for him to declare his interest. Since he did not make any reference to his deep knowledge of and interest in the industry, for him to have taken this case and use it against the Bill was a quite outrageous thing for him to have done.
      Mr. Hastings: I have declared my interest in the aircraft industry—[HON. Members: "When?"]—a sufficient number of times in this House for hon. Members to be aware of it. However, if it is felt that I should have declared it again, I apologise, although I still believe that my interest is well known.
      I was replying to some comments made by an hon. Gentleman who mentioned not simply the case of Bristol Siddeley but Ferranti as well. My case was that in both of them—and I believe that this is admitted in the Wilson Report—Government estimators were to some extent to blame. This seems a legitimate comment for an hon. Member to make considering what the right hon. Gentleman is seeking to do in the Clause.
      Mr. Benn: The hon. Gentleman's argument is rather like blaming the police for every murder that takes place on the grounds of incompetence in not in some way anticipating what would happen.
      Sir G. Nabarro: Really!
      Mr. Benn: One cannot expect civil servants who have been working for long
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      periods with a firm not to accept the word and the figures given by those people. However, this has nothing whatever to do with the Amendment and I regret that the hon. Member for Mid-Bedfordshire imparted it into the debate, because we shall be debating it—[Interruption.] The hon. Gentleman imparted into the discussion the whole argument of the relationship between Government Departments and industry. I am glad that he has declared his interest and, like all hon. Members, he will be aware of the help that Governments have given to the aircraft industry.
      This debate can be argued at two levels. One is the level of the hon. Member for Worcestershire, South (Sir G. Nabarro)—I was about to call him
      my hon. Friend"—which is the old knock-about level of nationalisation versus free enterprise. That is one way in which the Amendment and the Bill can be discussed. Unless one is putting an entirely new use on words, nationalisation involves a decision by Government to acquire a firm or industry by legislative action. The Bill confers no compulsory powers on the Government.
      The hon. Member for Worcestershire, South, who is a colourful, vivid and active hon. Member, should not impart into this argument elements that do not exist in it. There is a substantial difference between consent and the absence of consent, and we have made it absolutely clear from the beginning, from the time when we brought the Bill forward, that there is no element of compulsion in it. If after having repeated this—and I wish that the hon. Gentleman had participated in earlier debates on the subject—he still says that where there is no element of compulsion there is nationalisation, then I suggest that he is misusing words that are commonly accepted to mean something different.
      Sir G. Nabarro: Nationalisation to my mind means public ownership. It is the investment of public moneys in enterprises which were not formerly financed by public moneys, and this is, therefore, a nationalisation Measure. Most of my argument—and I trust that the right hon. Gentleman will be fair about this—was concerned with laying before the House comprehensive information about companies to be acquired.
      5.45 p.m.
      Mr. Benn: I was coming to that, because there is a second level at which this can be discussed, and I hope that we will be able to discuss it at that level. It is the way in which Government and industry should operate together in this very difficult area in which we know that, without some Government finance, certain industries could not survive. I of course accept that where one has money passing between Government and industry there are possibilities of all sorts of things going wrong. This is the territory which we are trying to explore, and I said in Committee, and I repeat now, that nobody yet believes that we have got this matter right. The Bill is an attempt to explore, experimentally, an area which in the past has not been handled very well.
      The hon. Member for Yeovil (Mr. Peyton) said that he did not defend everything that had been done by Conservative Administrations. That was a fair comment on his part; and I said I hoped that we would do better than Beagle when we come to other projects. We are experimenting in this area and, as I said, it is a difficult area to debate without raising the temperature very sharply unless one is prepared to consider the difficulties, problems and possibilities involved.
      Sir T. Brinton: Has not the right hon. Gentleman just made out a strong case for using extreme caution in the drafting of the Bill to ensure that the powers contained in it do not go too wide? After all, these powers could always be widened at a later stage, but I doubt if they would be circumscribed once given.
      Mr. Benn: To answer the hon. Gentleman's question about powers being circumscribed, not one penny can be spent under the Bill without the approval of Parliament. If I bring forward schemes—and the House knows that I have a scheme which I am bringing forward—I must satisfy the House in debate—and it will no doubt be a critical debate—before I am authorised to spend one penny of the £100 million which is authorised in general terms as a ceiling under the Bill.
      When I contrast this with, for example, the Civil Aviation Act, 1949, I see something totally different. Under that Measure successive Governments have
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      made tens of millions of £s available in launching aid for aircraft without even the requirement to come to the House of Commons. On Monday I made a statement on the Rolls Royce RB211 engine, but there was no obligation on me to make that statement to the House. If I went back over the years I would be interested to see how many Ministers in Conservative Administrations said to the House, "We have committed £10 million or £20 million in connection with a particular project."
      Sir G. Nabarro: A great many.
      Mr. Benn: The hon. Gentleman should look at the record.
      Sir Arthur Vere Harvey rose—
      Mr. Benn: I will give way to the hon. Gentleman. First, however, I wish to make it clear that this is not just a matter of being scrupulous. I am not accusing hon. Gentleman opposite of being other than scrupulous. I am saying that machinery was in existence—indeed, I am still using that machinery on the civil aviation side—which permitted Ministers of Aviation, with the consent of their colleagues—and, for this purpose, I am not saying that any particular decision was wrong—to make money available as launching aid for aircraft, for aeroengines and so on and that they did not come to the House about it.
      Thus, my first point is that, in considering this question of information—and my sympathies lie with the House, as I am seeking to show—I hope that the House will at any rate give me credit for having brought forward a Bill which promises to give infinitely more information—more than has ever been made available—before Government money is committed in support of industry.
      Sir A. V Harvey: I apologise for not being here to hear the earlier part of the debate. The right hon. Gentleman referred to the statement which he made on Monday. Some of us were mystified by it because he paid credit to Rolls Royce, to himself and to his Department. I suggest that he would have been a little more generous had he paid credit to those in the City for making the deal possible. I did not hear him refer to that.
      Mr. Benn: I referred to the Air Holdings arrangement, in which the Government were not a participant. I was on Monday not making a point about a personal contribution but was drawing attention to the fact that these deals cannot take place without Government and industry in partnership. This point was politically omitted. Nobody minds about personal contributions and—since there are a number of hon. Members present with experience of the aircraft industry—nobody knows better than the industry that if it had not been for Government contributions in, for example, research and development contracts—in which connection £1,500 million has been put in since the war—Government purchases, launching aid and so on. the aircraft industry of this country would not have the record of achievement which it manifestly has. I am not criticising anybody. If the House faces the fact that under Governments of both parties large sums of money are to be put into industry, it is high time we put it on a basis which gave us a greater chance of reviewing expenditures as and when they take place.
      Mr. David Price: Is the right hon. Gentleman telling us that the payment of £70 million to Rolls Royce is dealt with under this Bill and not under the Civil Aviation Act powers? He is exaggerating what he will do under this Bill.
      Mr. Benn: The hon. Gentleman knows this. I have dealt with this before in the House. The Industrial Expansion Bill does not replace the Civil Aviation Act. If it did it would have a different ceiling, for reasons which he will understand. In considering the problem of extending a greater measure of equality of treatment for other industries, I did better in bringing this Bill forward than was done when civil aviation was handled separately. The Industrial Expansion Bill, save for single projects, is designed to move in an area where there is no current legislation.
      The Amendment as worded, and as subsequently amended to delete £¼ million, asks me to lay all the facts before the House in those particular cases. I want to show to the House that this is (a) unnecessary and (b) in other cases impossible.
      May I take first the case where it is unnecessary. This debate has been con
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      ducted in a most extraordinary way. Since the Bill was last before the House, the first project under the Industrial Expansion Bill has come forward, the computer merger. In the course of the speeches which were made, not one hon. Member opposite mentioned the computer merger. What has happened in the computer merger? There were negotiations for three years, and intense negotiation for a year. Three companies were involved with the Government. Discuscussions went on over a long period with the companies, as a result of which the draft agreement was reached between the three companies and the Government. When this project comes before the House, the House will have access to all information that is available to the shareholders, and will be able to decide whether to approve it.
      The party opposite will forgive me for using strong language, but, throughout the entire debate, any one of them could have referred to the fact that this Amendment would have been met, and more than met, by the first project under the Bill. Nobody chose to refer to it.
      First, where there is this type of arrangement, the House will have far more information than it ever had before. I am not being critical of arrangements made by the previous Government, because we are all trying to find a better way of doing it. When we looked into Wiggins Teape in Committee, we discovered that Wiggins Teape was an enabling Bill, too. It was an enabling Bill that enabled the Government to do one thing. It was like a bee with one sting. The House had no further information about Wiggins Teape, indeed far less information, than the House will have under the computer merger. I do not say this in criticism, and the hon. Member for Eastleigh knows this.
      We have now hit upon a technique which I do not claim is perfect, because no doubt it can be improved. Before substantial sums of public money are committed, it will bring to the House sufficient details to enable it to decide whether to go ahead. It is open to the House to defeat the affirmative Order on the computer merger and to bring the whole operation to a halt. Parliamentary rights are fully preserved under the procedure of the Bill.
      Sir T. Brinton: The right hon. Gentleman is taking great pride in a further example following the handling of the appointment of the Parliamentary Commissioner. Are the Government taking action, envisaging action or taking credit for action which is not yet authorised by law or by their programme?
      Mr. Benn: The hon. Gentleman was not listening to me. My point is that the House has the power to stop this, subject to Parliamentary approval, as I said in my statement to the House. Unlike launching aid which may be announced in the House but is committed fully under an Act which gives no Parliamentary supervision, under this Bill the House will have to decide whether or not it wishes the merger to go ahead. The hon. Gentleman is totally wrong if he says that I have compromised Parliamentary authority. Of course I have not. The matter is tentative until the House decides to dispose of it by passing the affirmative Order.
      If I may deal with the first type of case where there are likely to be investments in industry involving perhaps a merger or involving a single company, the House will always be in as strong a position as the shareholders. The accounts of the companies will be published and will be available to the House. To that extent, the hon. Member for Worcestershire, South (Sir G. Nabarro) has missed the point altogether.
      The second type of scheme, where it is impossible to provide this information, is the industry-wide scheme such as that of the Shipbuilding Industry Board. Throughout the whole of the debate, there was no reference to the shipbuilding industry, although it is very well known to the House that one of the objects of the Bill is to allow the Government, on a cooperative basis with other industries, to do the same sort of thing which it is now doing with a degree of success in relation to the shipbuilding industry. If there were criticism of the technique of the Industrial Expansion Bill, one would have expected hon. Gentlemen opposite to have found something to criticise in the one place where it has been tried, namely, in relation to shipbuilding, but not a single example was given by hon. Members opposite on the shipbuilding case.
      Mr. Peyton: The right hon. Gentleman is misunderstanding—I am sure not wilfully—the purpose of the Opposition, which is to make a very small Amendment asking that when every proposal is put forward the information required is available.
      Mr. Benn: I am not misunderstanding the purpose of the Opposition at all. I am understanding it too clearly, which accounts for the embarrassment in which the hon. Gentleman finds himself.
      What did the House decide to do in the case of the shipbuilding industry? It decided to put £5 million into grants available for shipbuilding—which under this Bill will we hope be increased to £20 million—and £30 million into loans.
      In accordance with the provisions of the Bill, the House decided to put this in the hands of a Shipbuilding Industry Board, headed by a very senior industrialist. The purpose and advantage of this procedure was not only that the Minister would not have to be concerned with detailed negotiations, but that the Shipbuilding Industry Board would have the absolute necessity of freedom of negotiation to bring together the Upper Clyde Group, which took months of negotiation, to work with the other groups that we are hoping to negotiate, such as the Wear group.
      I must say this to my hon. Friend who raised the question of industrialists in government. It is crying for the moon to hope that senior industrialists will come into Government to administer a scheme. What I think is possible, and what the Bill is intended to provide, is that where there is a consensus about the needs of industry, if the House is prepared to authorise a general scheme and a global sum, the job can be sub-contracted to industrialists. In order to move industrialists into relationship with Government they must be given a measure of freedom to negotiate, within the limits of an agreed total of money and an agreed policy for that industry.
      6.0 p.m.
      It is curious that when people talk about Government interfering with industry so little attention is given to the much more interesting movement which has occurred recently under which Government actually hands over certain of

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      their responsibilities to industrialists. N.R.D.C. is a perfect example. Where money must be provided to stimulate technological advance, the way to do it is to get a distinguished industrialist, like Sir William Black, and a number of colleagues to dispense it in accordance with a clear and agreed policy laid down by Parliament. If that is done, the House cannot be asked to look at every investment that it makes. In the case of the shipbuilding industry operation, if I had had to bring every stage of every negotiation hack to the House, before the Upper Clyde Group came into being the whole thing would have folded.
      What we are trying to do is to find a way by which this can be done that preserves and enhances Parliamentary authority, but at the same time allows a measure of flexibility. That is why the Amendment is not possible. It would not be possible to repeat the Shipbuilding Board experience, if everything over £250,000 had to come back specifically to the House of Commons; the House would find itself reorganising shipbuilding in its own Committees, and that would not be practicable. However, I assure the House that, just as with the computer merger, there will be the fullest availability of information of a kind which the House has never had in its history in authorising the payment of money to industry.
      Mr. Tom Boardman: Surely in the case of shipbuilding there was sufficient information available to make an informed judgment on the merits or demerits. We had the Geddes Report. Information was available upon which a judgment could be formed. If it was not, on what basis was the scheme put forward at all?
      Mr. Benn: The hon. Gentleman is now moving his ground, and I understand why. It is one thing to say that we are not to give any money to any firm unless all six requirements of the hon. Member for Worcestershire, South are made available to the House. It is another thing to say that, after looking at the industry, clearly it needs an injection of capital to re-equip itself, and then give to the Board the power to implement this policy subject to the Minister's accountability to the House. If he says that every Minister bringing forward a scheme has to justify himself, I am wholly with him.
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      There has been an extraordinary sensitivity and confusion in the minds of many hon. Members opposite about money which is given and which takes the form of an equity holding. Almost all the speeches that we have heard from hon. Gentlemen opposite have been about the terrible fear that we might under any circumstances acquire an equity holding. When we debated the matter before, I made it clear that I would think it right to recommend an equity holding to the House if we were taking a risk on a major project and the public was entitled to share in the profitability flowing from it. In the computer case, I could not have recommended bringing forward an investment of this kind on terms other than those which gave us a very small minority holding. If hon. Gentlemen opposite think that our motive here is to buy bits of companies which will not succeed up and down the country, they have misunderstood the purpose of the Bill. However, it does not damage the Bill to think that, because in operation it will not be controversial.
      Mr. Peyton: Not controversial?
      Mr. Benn: The debates are controversial, but that is different from saying that the Bill is controversial. This country cannot conceivably keep abreast of advanced technology unless we find a way of providing Government support for certain advanced industries. The hon. Member for Worcestershire, South speaks about industry in such terms as, "If only the Government kept away, everything would be all right." That is a total misunderstanding of the realities of the international competition facing the United States Government, for example, who pour money into the space and defence programmes and give American industry a great advantage in competing abroad with our own.
      Mr. Ridley rose—
      Mr. Hastings rose—
      Sir T. Brinton rose—
      Mr. Benn: Hon. Gentlemen must sort it out for themselves.
      Mr. Deputy Speaker (Mr. Sydney Irving): Order. The right hon. Gentleman must indicate to whom he is giving way.
      Mr. Benn: Mr. Deputy Speaker, it is very difficult to decide. They are all so unattractive. I will give way to the hon. Member for Kidderminster (Sir T. Brinton).
      Sir T. Brinton: I thank the right hon. Gentleman for his usual good manners.
      Mr. Emery: He is a Wykehamist.
      Sir T. Brinton: We had precisely the same debate in Committee, where we made the point which we must make again. The right hon. Gentleman has instanced the American Government's handling of a similar problem. They have created a market for the products of science and technology and left it at that. The right hon. Gentleman wishes to do it the other way. He must not confuse the two.
      Mr. Benn: If a country is rich, it can do that. It can create a market that it does not need to get a tiny benefit from the spin-off in the advanced technologies. The American Government have chosen a wasteful method, but they are in a position to do it. Their budget for the space programme this year is 7 billion dollars, which means that they are spending more on space than the entire research and development of British industry. That gives American firms a considerable advantage. But if anyone thinks that we should do it by creating a market of that size in the hope that it will happen here, he is quite wrong. It cannot be done.
      Mr. Hastings rose—
      Mr. Benn: I will not give way again. The hon. Gentleman knows very well that we would not have an aircraft industry of the kind that we have today if it had not been for enormous support from the Government over the years which have enabled us to compete with an American industry which has received even more money.
      Since this has been a Parliamentary debate, may I finish on this question of Parliamentary accountability. I repeat what I said earlier. There has never been, under the provisions of any other Act of Parliament, such detailed security for the House to know the facts of every individual scheme. The Bill authorises no expenditure by any Minister other than the special cases which are dealt with in self-contained Clauses. No investment
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      scheme can be brought forward without the House having an opportunity to consider and reject it. In the case of the first scheme, the House will have more information than has ever been made available on any scheme. When one combines that with the extended use of Select Committees in the House, the Ombudsman, and so on, it is true to say that the balance of advantage is now with the individual Member of Parliament. Under this Government, in this and other ways, the administration has been very sharply titled towards Parliamentary accountability. The Bill is another step in this direction, and I hope that the House will reject the Amendment.
      Mr. Terence L. Higgins: The Minister says that the Bill is not controversial and that only the speeches have been controversial. I cannot quite understand how he comes to that conclusion after we voted against it on Second Reading, and I know that a number of hon. Friends will join with me in opposing it at many stages today.
      It is a controversial Bill and on this Amendment we cannot accept the argument that he puts forward that there is sufficient Parliamentary scrutiny because the Government cannot spend any money unless there is adequate Parliamentary debate. There is no point in having Parliamentary debate if we do not have the adequate information which is necessary to make that debate meaningful. That is the purpose of the Amendment.
      I have to confess to the right hon. Gentleman that, now that he has sat down, I am not clear whether he accepts or rejects the Amendment. I conclude from his general tone that it is his intention to reject it. We have had some 14 speeches on it, and I do not propose to detain the House for more than a few moments.
      Perhaps I might refer to the speeches of the hon. Member for Edinburgh, East (Mr. Willis) and the hon. Member for Dunbartonshire, East (Mr. Bence) and say that it would have been helpful if they had heard the opening remarks of my hon. Friend the Member for Eastleigh (Mr. David Price). They seemed to be arguing, on the one hand, that it would be a good thing if Parliament had no information on this kind of subject in order, on the other hand, that Parliament might be able to reach an informed

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      judgment about what we were discussing That is not the position. It is absolutely essential that if money of this order—taxpayers' money, not the Government's money—is to be spent, we should have adequate information available.
      I turn to two particular points in the Amendment. The first is on the question of profit forecasts. It is perfectly true that some of these projects may not in fact make a profit. If so, it is all the more important that we should have the figures worked out of whether or not there is a case for investing Government money in such projects. We need an adequate estimate of what the profit forecasts are likely to be. This means that we must have an estimate of the demand side and of the cost side of the proposals.
      What has come out time and again in Committee and in subsequent debates is that the kind of proposal which the Government will undertake under this Bill is one in which they do not wish to tell us what the demand for the project will be. While we accept the well-meaning declaration of the Minister that he would like the projects to produce things which people want to buy, it is not meaningful unless, at the same time, he assures the House that he will include adequate demand forecasts. It is significant, for example, that on the Concorde project he has not been prepared to make estimates of the ultimate demand.
      Mr. Benn: Since there is only one project of this kind in prospect, the one announced of the computer merger where there has been a report which has been widely publicised, I ask whether the hon. Gentleman believes that in that case there will be any ground for criticism about the kind of information made available to the House, since it will be identical with that made available to the shareholders?
      Mr. Higgins: We are not in a position to make a sound judgment on this. We do not know what the amounts will be through time. That has not been given to us. It is very relevant to the economic situation, although I would be out of order to discuss it, but the fact that the right hon. Gentleman may be able to do so in one case does not meet the general point of this Amendment and this is the important matter to discuss.
      426
      We lay particular emphasis on asset valuation. I am surprised to see that in the White Paper produced by the Government on the Beagle aircraft the best they can do by way of asset valuation is on fixed assets at cost less depreciation, as against a replacement cost basis which would have been more meaningful. It is essential in all the cases to have adequate information on which the House can make its decision. It is essential that we should do this because, as my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) pointed out, this in effect is an extension of public ownership.
      6.15 p.m.
      It is not good enough to say that we will be given more information than we have had on previous occasions. If public ownership is being extended, it is right and proper that this House should ask for adequate information to determine whether a proposal is justified or not. That was the fundamental point which my hon. Friend endeavoured to bring out. We need to know the rate of return we shall get on this kind of project and how it will compare with the rates of return specified much more precisely in the other areas of public ownership where nationalised industries are involved. I hope that on all these grounds my hon. Friends will feel able in the Division Lobby to support the Amendment.
      I do not think that the same criteria apply in the case of this kind of project as in the case where there is a straight Government grant. A straight Government grant is on a quite different footing. It would be absurd to say that the Government should investigate every case in which they give a grant in a development area, but when it is a case of actual Government participation we need to have the information.
      As the hon. Member for Ashton-under-Lyne (Mr. Sheldon) pointed out, we do not want to prop up inefficient industries, but, unless this Amendment is accepted, we shall not know whether or not that is being done. We are concerned here with an area of public expenditure. This Bill will raise very considerable sums of money which will be invested on the basis of what the right hon. Gentleman said. This will be one of the many projects of the Government which lead to the kind of Budget we have had this

      427
      year. It is an extension of public ownership. It means that taxes have to be raised or money has to be borrowed. We do not believe that this should be done without adequate examination. We do not believe adequate examination can be made unless this Amendment is accepted and the Government are far more forthcoming in providing information and ensuring Parliamentary debate than they
      have been or as, by the tone of his reply, the right hon. Gentleman suggested they are likely to be. I hope my hon. Friends will join me in the Division Lobby in voting in favour of this Amendment.
      Question put, That the Amendment be made:—
      The House divided: Ayes 166, Noes 210.

      Division No. 104.]

      AYES

      [6.18 p.m.

      Allson, Michael (Barkston Ash)

      Grant-Ferris, R.

      Oaborne, Sir Cyril (Louth)

      Allason, James (Hemel Hempstead)

      Gresham Cooke, R.

      Pearson, Sir Frank (Clitheroe)

      Astor, John

      Grimond, Rt. Hn. J.

      Percival, Ian

      Awdry, Daniel

      Hall-Davis, A. G. F.

      Peyton, John

      Baker, K. W. (Acton)

      Harris, Frederic (Croydon, N.W.)

      Pike, Miss Mervyn

      Baker, W. H. K. (Banff)

      Harrison, Brian (Maldon)

      Pink, R. Bonner

      Balniel, Lord

      Harrison, Col. Sir Harwood (Eye)

      Powell, Rt. Hn. J. Enoch

      Beamish, Col. Sir Tufton

      Harvey, Sir Arthur Vere

      Price, David (Eastleigh)

      Bell, Ronald

      Hawkins, Paul

      Pym, Francis

      Bennett, Sir Frederic (Torquay)

      Higgins, Terence L.

      Quennell, Miss J. M.

      Bessell, Peter

      Hiley, Joseph

      Ramsden, Rt. Hn. James

      Biggs-Davison, John

      Hill, J. E. B.

      Rhys Williams, Sir Brandon

      Birch, Rt. Hn. Nigel

      Hogg, Rt. Hn. Quintin

      Ridley, Hn. Nicholas

      Black, Sir Cyril

      Holland, Philip

      Ridsdale, Julian

      Blaker, Peter

      Hooson, Emlyn

      Rossi, Hugh (Hornsey)

      Boardman, Tom

      Hordern, Peter

      Russell, Sir Ronald

      Boyd-Carpenter, Rt. Hn. John

      Hornby, Richard

      Scott, Nicholas

      Brewis, John

      Howell, David (Guildford)

      Scott-Hopkins, James

      Brinton, Sir Tatton

      Hunt, John

      Sharpies, Richard

      Bromley-Davenport, Lt.-Col. Sir Walter

      Hutchison, Michael Clark

      Sinclair, Sir George

      Brown, Sir Edward (Bath)

      Irvine, Bryant Godman (Rye)

      Smith, D. G. (W'wick & L'mington)

      Bryan, Paul

      Jenkin, Patrick (Woodford)

      Smith, John

      Buchanan-Smith, Alick (Angus, N & M)

      Johnston, Russell (Inverness)

      Stainton, Keith

      Buck, Antony (Colchester)

      Jopling, Michael

      Steel, David (Roxburgh)

      Carlisle, Mark

      Kershaw, Anthony

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

      Carr, Rt. Hn. Robert

      King, Evelyn (Dorset, S.)

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

      Channon, H. P. G.

      Kirk, Peter

      Taylor, Frank (Moss Side)

      Chichester-Clark, R.

      Kitson, Timothy

      Temple, John M.

      Clegg, Walter

      Knight, Mrs. Jill

      Thatcher, Mrs. Margaret

      Cooke, Robert

      Lane, David

      Thorpe, Rt. Hn. Jeremy

      Corfield, F. V.

      Langford-Holt, Sir John

      Turton, Rt. Hn. R. H.

      Costain, A. P.

      Lloyd, Rt. Hn. Selwyn (Wirral)

      van Straubenzee, W. R.

      Craddock, Sir Beresford (Spelthorne)

      Lubbock, Eric

      Vaughan-Morgan, Rt. Hn. Sir John

      Crouch, David

      McAdden, Sir Stephen

      Wainwright, Richard (Colne Valley)

      Crowder, F. P.

      MacArthur, Ian

      Walker, Peter (Worcester)

      Dalkeith, Earl of

      Maclean, Sir Fitzroy

      Wall, Patrick

      Dance, James

      McMaster, Stanley

      Walters, Dennis

      Davidson, James(Aberdeenshire, W.)

      Maddan, Martin

      Ward, Dame Irene

      Dean, Paul (Somerset, N.)

      Maginnis, John E.

      Weatherill, Bernard

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

      Mawby, Ray

      Webster, David

      Digby, Simon Wingfield

      Maxwell-Hyslop, R. J.

      Wells, John (Maidstone)

      Doughty, Charles

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

      Whitelaw, Rt. Hn. William

      Elliot, Capt. Walter (Carshalton)

      Mills, Peter (Torrington)

      Williams, W. D. (Dudley)

      Emery, Peter

      Mills, Stratton (Belfast, N.)

      Wills, Sir Gerald (Bridgwater)

      Eyre, Reginald

      Mitchell, David (Basingstoke)

      Wilson, Geoffrey (Truro)

      Farr, John

      Monro, Hector

      Winstanley, Dr. M. P.

      Fisher, Nigel

      Montgomery, Fergus

      Wolrige-Gordon, Patrick

      Fletcher-Cooke, Charles

      Mott-Radclyffe, Sir Charles

      Wood, Rt. Hn. Richard

      Fortescue, Tim

      Munro-Lucas-Tooth, Sir Hugh

      Worsley, Marcus

      Foster, Sir John

      Murton, Oscar

      Wright, Esmond

      Galbraith, Hon. T. G.

      Nabarro, Sir Gerald

      Wylie, N. R.

      Gilmour, Sir John (Fife, E.)

      Neave, Airey

      Younger, Hn. George

      Godber, Rt. Hn. J. B.

      Nicholls, Sir Harmar

      TELLERS FOR THE AYES:

      Goodhart, Philip

      Noble, Rt. Hn. Michael

      Mr. R. W. Elliott and

      Goodhew, Victor

      Onslow, Cranley

      Mr. Jasper More.

      Gower, Raymond

      Orr, Capt. L. P. S.

      Grant, Anthony

      Osborn, John (Hallam)

      NOES

      Abse, Leo

      Atkinson, Norman (Tottenham)

      Bennett, James (G'gow, Bridgeton)

      Allaun, Frank (Salford, E.)

      Bagier, Gordon A. T.

      Bishop, E. S.

      Alldritt, Walter

      Barnett, Joel

      Blenkinsop, Arthur

      Anderson, Donald

      Baxter, William

      Booth, Albert

      Archer, Peter

      Bence, Cyril

      Boston, Terence

      Atkins, Ronald (Preston, N.)

      Benn, Rt. Hn. Anthony Wedgwood

      Bottomley, Rt. Hn. Arthur

      Boyden, James

      Heffer, Eric S.

      Ogden, Eric

      Bradley, Tom

      Henig, Stanley

      O'Malley, Brian

      Braine, Bernard

      Hooley, Frank

      Oram, Albert E.

      Brooks, Edwin

      Horner, John

      Orme, Stanley

      Broughton, Dr. A. D. D.

      Houghton, Rt. Hn. Douglas

      Oswald, Thomas

      Brown, Rt. Hn. George (Belper)

      Howarth, Harry (Wellingborough)

      Page, Derek (King's Lynn)

      Buchan, Norman

      Howarth, Robert (Bolton, E.)

      Palmer, Arthur

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

      Hoy, James

      Pannell, Rt. Hn. Charles

      Butler, Herbert (Hackney, C.)

      Huckfield, Leslie

      Park, Trevor

      Cant, R. B.

      Hughes, Hector (Aberdeen, N.)

      Parker, John (Dagenham)

      Carmichael, Neil

      Hughes, Roy (Newport)

      Parkyn, Brian (Bedford)

      Carter-Jones, Lewis

      Hunter, Adam

      Pearson, Arthur (Pontypridd)

      Chapman, Donald

      Hynd, John

      Pentland, Norman

      Coleman, Donald

      Perry, Ernest G. (Battersea, S.)

      Concannon, J. D.

      Jackson, Peter M. (High Peak)

      Perry, George H. (Nottingham, s.)

      Conlan, Bernard

      Jeger, George (Goole)

      Price, Thomas (Westhoughton)

      Craddock, George (Bradford, S.)

      Jenkins, Hugh (Putney)

      Price, William (Rugby)

      Crawshaw, Richard

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

      Probert, Arthur

      Cronin, John

      Jones, Dan (Burnley)

      Randall, Harry

      Cullen, Mrs. Alice

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

      Rees, Merlyn

      Darling, Rt. Hn. George

      Jones, J. Idwal (Wrexham)

      Roberts, Albert (Normanton)

      Davidson, Arthur (Accrington)

      Jones, T. Alec (Rhondda, West)

      Robertson, John (Paisley)

      Davies, Dr. Ernest (Stretford)

      Kelley, Richard

      Rogers, George (Kensington, N.)

      Davies, G. Elfed (Rnondda, E.)

      Kerr, Dr. David (W'worth, Central)

      Rose, Paul

      Davies, Ifor (Gower)

      Lawson, George

      Ross, Rt. Hn. William

      Delargy, Hugh

      Leadbitter, Ted

      Rowlands, E. (Cardiff, N.)

      Dell, Edmund

      Ledger, Ron

      Ryan, John

      Dempsey, James

      Lee, Rt. Hn. Frederick (Newton)

      Sheldon, Robert

      Dewar, Donald

      Lee, John (Reading)

      Shinwell, Rt. Hn. E.

      Dickens, James

      Lestor, Miss Joan

      Shore, Rt. Hn. Peter (Stepney)

      Doig, Peter

      Lewis, Ron (Carlisle)

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

      Dunwoody, Mrs. Gwyneth (Exeter)

      Loughlin, Charles

      Silkin, Rt. Hn. John (Deptford)

      Eadle, Alex

      Lyon, Alexander W. (York)

      Silverman, Julius (Aston)

      Edwards, Robert (Bilston)

      Lyons, Edward (Bradford, E.)

      Slater, Joseph

      Edwards, William (Merioneth)

      Mabon, Dr. J. Dickson

      Small, William

      Ellis, John

      McBride, Neil

      Steele, Thomas (Dunbartonshire, W.)

      Ennals, David

      MacColl, James

      Stonehouse, John

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

      Macdonald, A. H.

      Swingler, Stephen

      Faulds, Andrew

      McGuire, Michael

      Symonds, J, B.

      Fernyhough, E.

      Mackenzie, Gregor (Rutherglen)

      Thornton, Ernest

      Fletcher, Raymond (Ilkeston)

      Maclennan, Robert

      Tinn, James

      Fletcher, Ted (Darlington)

      McMillan, Tom (Glasgow, C.)

      Tomney, Frank

      Foley, Maurice

      MacPherson, Malcolm

      Tuck, Raphael

      Foot, Rt. Hn. Sir Dingle (Ipswich)

      Mahon, Peter (Preston, S.)

      Urwin, T. W.

      Foot, Michael (Ebbw Vale)

      Mahon, Simon (Bootle)

      Varley, Eric G.

      Forrester, John

      Mallalieu, E. L. (Brigg)

      Wainwright, Edwin (Dearne Valley)

      Fowler, Gerry

      Manuel, Archie

      Wallace, George

      Freeson, Reginald

      Mapp, Charles

      Watkins, David (Consett)

      Galpern, Sir Myer

      Marks, Kenneth

      Watkins, Tudor (Brecon & Radnor)

      Gardner, Tony

      Marquand, David

      Weitzman, David

      Garrett, W. E.

      Marsh, Rt. Hn. Richard

      Wellbeloved, James

      Ginsburg, David

      Mason, Rt. Hn. Roy

      Wells, William (Walsall, N.)

      Gourlay, Harry

      Maxwell, Robert

      Whitaker, Ben

      Gregory, Arnold

      Mayhew, Christopher

      Wilkine, W. A.

      Grey, Charles (Durham

      Mendelson, J. J.

      Willey, Rt. Hn. Frederick

      Griffiths, David (Rother Valley)

      Millan, Bruce

      Williams, Clifford (Abertillery)

      Griffiths Rt. Hn. James (Llanelly)

      Miller, Dr. M. S.

      Williams, W. T. (Warrington)

      Griffiths, Will (Exchange)

      Milne, Edward (Blyth)

      Willis, Rt. Hn. George

      Hamilton, James (Bothwell)

      Mitchell, R. C. (S'th'pton, Test)

      Woodburn, Rt. Hn. A.

      Hamilton, William (Fife, w.)

      Moonman, Eric

      Woof, Robert

      Hamling, William

      Morgan, Elystan (Cardiganshire)

      Yates, Victor

      Harper, Joseph

      Morris, Alfred (Wythenshawe)

      TELLERS FOR THE NOES

      Harrison, Walter (Wakefield)

      Morris, Charles R. (Openshaw)

      Mr. John McCann and

      Haseldine, Norman

      Morris, John (Aberavon)

      Mr. Harold Walker.

      Hattersley, Roy

      Moyle, Roland

      Hazell, Bert

      Newens, Stan

    Clause 2.

      CONTENTS OF SCHEMES.
      Mr. Ridley: I beg to move Amendment No. 13, in page 2, line 7, to leave out 'industrial'.
      We can deal with this Amendment quickly. As far as I am concerned, it is purely interrogatory, because I do not quite see why it is that we need to confine the benefits of the Bill to indus
      430
      trial projects. I make it clear that I am against the principle of the Bill, but, as we are to distribute this public money, I do not see why it should be limited to industrial projects. The competent authorities under Clause 1 will often not be concerned with industrial projects. For example, the Ministry of Agriculture, Fisheries and Food and the Ministry of Health do not have industrial projects or anything to do with them.

      431
      Perhaps a case could be made out for agriculture and fisheries. [HON. MEMBERS: "Groundnuts."] No doubt groundnuts will be high on the list for the Government, but they will be debarred if the word "industrial" remains in the Bill. I cannot see why the tourist industry should be left out. The point of the Bill is to
      "…create, expand or sustain productive capacity or promote or support technological improvements…"
      It seems odd, therefore, to confine these projects in the straitjacket of this rather curious word "industrial", which raises pictures of workshops, oil and dirt and cloth caps—the old Socialist traditional image—when surely we mean any project, whether it be by the City, by agriculture, tourism or almost any other activity. As I have said, I put this Amendment interrogatively rather than move it with any force.
      Sir G. Nabarro: I am glad that my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) has raised this point, because it is rather important for us to know what is an industrial project. My interpretation, if I were asked outside this House, is one which is governed by the requirements of the Factories Act. I do not suppose that anyone could really refute that. But I was pulled up rather sharply years ago when a woman in my constituency was killed. She suffered a particularly painful death. She was scalped as a result of her hair being caught in the pulleys of a hop-picking machine.
      When I raised the matter at once with the Ministry of Labour, I was told that a hop-picking machine was not an industrial machine and that a hop-picking shed did not come under the Factories Act because that building in which it was contained was not a workshop within the terms of the Act. Later, the anomaly was put right by a special provision in an ensuing Act of Parliament. It is dubious to know what is an industrial project. For example, is a hop-yard project an industial project, because it is not an agricultural project?
      I should like a definition to be given today. The word "industrial" appears several times in this Clause and in later Clauses. As I sit for a farming con
      432
      stituency, both agricultural and horticultural, I should like to know, in particular, whether farming is regarded, within the context of the Bill, as an industrial pursuit. This is a legitimate question, because Clause 1(3) names the Minister of Agriculture, Fisheries and Food as one of the competent authorities. Would a farming investment, be it agricultural or horticultural, be deemed an industrial project under Clause 2?
      6.30 p.m.
      Mr. Moonman: I did not subscribe to the view expressed by some of my hon. Friends when they said that Amendment 3 was frivolous. I thought it an important Amendment which raised definite differences of opinion. This Amendment, however, I do regard as frivolous. I cannot reconcile the argument advanced by the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) with his Amendment to leave out the word "industrial". Perhaps the kindest comment one can make is that he is selecting certain aspects of the Clause and not reading the word "industrial" in relation to the rest of it. The reference in paragraph (a) is to the
      "profitability of an industry or section of an industry",
      and so on. He has referred in the Amendment only to line 7, where the reference is to "any industrial project".
      There is no question of the Government trying to establish an "image" by Act of Parliament. This has nothing to do with any question of Socialist image. The word "industry" is perfectly clear, and the context in which it appears in the Bill shows that the intention is that, within an industry or section of an industry, a project should be produced. It is possible to cite all manner of extraordinary examples of projects arising in connection with, say, hospitals and other activities. The hon. Member for Worcestershire, South (Sir G. Nabarro) raised the question of the interpretation of the law in another context. However, the word is perfectly clear here, and I can only regard this as a rather frivolous Amendment.
      Mr. Benn: The Amendment is not, perhaps, as significant as the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) thought, because the word "industrial" appears earlier in the Clause

      433
      and in later subsections. However, as one naturally wants, all things being equal, to accept Amendments which are moved by hon. Members who feel strongly about them, and as all other things are equal here, if it would help the hon. Gentleman I am ready to remove the word "industrial" as he proposes. I do not want to mislead him into thinking that this will be of great significance, because the nature of the schemes is fairly fully dealt with in other parts of the Bill. On that basis, I should be happy to accept the Amendment.
      Dame Irene Ward: I am sure that we are all grateful to the right hon. Gentleman for accepting the Amendment, but will he remove the word "industrial" where it appears elsewhere in the Clause? The Amendment is to remove it from line 7, but in the whole Clause there are a good many references to it. What will the right hon. Gentleman do about all the other places where it appears?
      Mr. J. T. Price: On a point of order, Mr. Speaker. In case we are in danger of losing more time on frivolities, may I submit to you that, as the Amendment has not been formally moved, and the hon. Member for Cirencester and Tewkesbury (Mr. Ridley), in whose name it stands, chose not to move it, any subsequent debate about it is out of order?
      Mr. Speaker: The Amendment was put from the Chair at the end of the first speech.
      Mr. Benn: To answer the hon. Lady the Member for Tynemouth (Dame Irene Ward), I cannot remove the word "industrial" everywhere.
      Dame Irene Ward: In this Clause.
      Mr. Benn: No. The hon. Member for Cirencester and Tewkesbury moved his Amendment to delete the word in one line, partly in order to get clarification and partly because he thought that there was a point of substance raised by it. I have yielded to his suggestion, but it has no bearing on the use of the word "industry" or "industrial" in other parts of the Clause or the Bill. It will simply mean that the word "project" will stand on its own, instead of "industrial project". The hon. Lady's question raises far wider issues.
      Sir G. Nabarro: My question was perfectly serious—there was no frivolity about it—and I should like the right hon. Gentleman to apply himself to it. Clause 1 names the competent Ministers, and one is the Minister of Agriculture, Fisheries and Food. Is agriculture an industry? The President of the Board of Trade is another Minister named. Is tourism an industry? What is the position if we remove the word "industrial"?
      Mr. Benn: I had better resist the temptation to go too far into definitions which may have different meanings in different Measures and in common parlance. Agriculture is an industry for this purpose. The hon. Gentleman knows that one may well find that certain advanced technologies are used over a wide range of industries and are used in operations which have not hitherto been regarded as industrial. For example, the development of a new bio-engineering project will be carried on with a view to its application in a health field, which is not industrial, whereas the stimulation of the project is industrial. An education technology may be technological in production but not industrial in application because it is used in schools.
      I do not think that it has much bearing on the particular problem, but it is true that the Minister of Agriculture, Fisheries and Food is one of the Ministers described as a competent authority for the purpose of bringing a scheme before the House.
      Mr. Ridley: I am sorry that the hon. Member for Billericay (Mr. Moonman) thought this a frivolous Amendment. In my view, one can refer to agriculture or tourism as industries—they are industries—but no one would claim that they are industrial. This may be playing with words, perhaps, but the removal of the word "industrial" here will liberate the field a little. At the same time, the references to
      "an industry or section of an industry"
      can be construed as referring to agriculture, tourism, the fishing industry or any other industry. I do not wish to take time. The Amendment has improved the Bill, and I am grateful to the Minister for accepting my suggestion.
      Amendment agreed to.
      Mr. Peyton: I beg to move Amendment No. 14, in page 2, line 8, leave out
      'in the opinion of that authority '.
      When he was replying to the first debate, the right hon. Gentleman declared himself on a number of occasions as of opinion that the Bill was not controversial. I assure him that it is, and the controversy goes very much to the question of the competence of the authority. To start with, I object to the number of authorities capable of taking action under the Bill. It is the opinion of any one of those authorities with which we are here concerned.
      I ask the right hon. Gentleman—he verged on the offensive just now towards one of my hon. Friends in a way that Ministers are ill advised to do when they are trying to get their business—not to construe what I am about to say as a great attack on the Civil Service or anything of the kind. I doubt that the Government machine is properly equipped to take such a large and increasing part in industry. At many points in earlier debates on the Bill, he has said—and this is true—that in the past different firms nave been helped in rather informal ways. There is nothing wrong in that in principle, but it is probably a wrong practice. The right hon. Gentleman now says that he is laying down ground rules which will cover these operations. What worries me is that the availability of the ground rules will encourage the Government even further down the same road and we shall have more Government dabbling in industry.
      Let us consider the opinion of a so-called competent authority in the context of a specific example. The right hon. Gentleman brought this on himself, even if it would not have come from me anyhow, when he chided us a little while ago for not referring to individual projects. I take as an example which brings into question the judgment of the competent authority the Government's plan to embark on the Beagle aircraft project. I very much doubt whether in five or 10 years' time the Government will be able to look back on this with pride. I do not know quite what the legal position is as to whether they have the power to do what they have been doing and to occupy the position they have occupied over the past two years vis-à-vis Beagle Aircraft,
      436
      because the Act of 1949, I think it is, forbids the Government to take part in the manufacture of civil aircraft. If we are only now coming to the point of correcting that position I think that it has been left far too long.
      Mr. Benn: We have not bought Beagle. Beagle is a private company which we are supporting under the Civil Aviation Act pending the authorisation of the House, if it gives it to us, to buy it. I assure the hon. Gentleman that, whether or not it was wise to decide to buy it, we have in no way been in breach of the law or customs of the House in what we have done in the interim period.
      Mr. Peyton: I am obliged for that assurance.
      I come to the point with which the Amendment is concerned, that is, whether the Government, which faces fearful problems in these fields, is wise to extend those problems in this way. If by the exercise of their judgment they are led into such projects as Beagle I believe that that fortifies the argument of those on this side of the House who do not like the Bill.
      This is a matter of opinion. The right hon. Gentleman entitled to his, and whether or not he thinks that I am wrong I hold these views very strongly. There is some evidence that Government incursions into industry are not always all that fortunate in their results. I wonder whether the large market which the Government have foreseen for the Beagle type of aircraft will materialise. I am sure that the House would be delighted if the right hon. Gentleman could reassure us on this point, to show that the opinion which will be exercised by a competent authority under the Bill is justified.
      The Minister chided us for not giving examples. I believe that one is perfectly justified in giving either Beagle or Cunard, or anything else specifically mentioned in the Bill, as an example of what the exercise of the judgment, the responsibility for which is put on the Government, leads to. Without going into detail about Beagle, one is justified in telling the Minister that here is one field into which he is being led by thinking with which we do not agree.
      The Amendment would leave out the words "in the opinion of that authority".

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      I am concerned to leave them out in order to challenge the Minister's frequently stated judgment and opinion that the Government are a competent body to do this kind of thing. I believe that they take on themselves far too readily risks which are wholly unjustified, and that there is a very grave danger of their collecting lame ducks. The right hon. Gentleman is very much concerned with lame ducks. I have read through a great deal of the Committee proceedings and have found at least three references by him to lame ducks. On 20th February he said:
      "The Treasury considers every scheme to see whether it stands on its own merits, that is to say, whether it is a good scheme or another potential lame duck."—[OFFICIAL REPORT, Standing Committee E, 20th February, 1968; c. 68.]
      I ask the House to note the words "another potential lame duck". The right hon. Gentleman's powers of apprehension were warning against what the Bill might lead him into. On 22nd February he spoke of "lame ducks promoted for political purposes", and later said:
      "If we have lame ducks which do not fly, then politically it will be embarrassing."—[OFFICIAL REPORT, Standing Committee E, 22nd February, 1968; c. 102–7.]
      Mr. Emery: Is that a reference to the Prime Minister?
      Mr. Peyton: I know not whether the right hon. Gentleman was referring to any of his colleagues or to projects which could arise under the Bill. Those words are obviously in the Minister's mind, and the danger of the Government's selecting lame ducks or having lame ducks forced on them is what worries me now and lea me to move the Amendment. I am not talking about the mammoth things like Rolls Royce, which everybody with any sense must obviously welcome wholeheartedly. That is a splendid thing—there is no question of opinion there. What I am talking about is the Government just filtering into every field, into all sorts of projects, because a so-called competent authority has decided that it is a good thing to do so.
      The Government will find that their opportunities to collect lame ducks are far greater than those of collecting successes and to me it is a matter of concern. I know that we have been told
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      for many a long day that the party opposite believes that the gentleman in Whitehall really knows best.
      Mr. Benn indicated dissent.
      Mr. Peyton: That has been the doctrine for ages. I do not believe it. I believe that the tasks of Government and the hazards are great enough without the Government's allowing themselves to be tempted into a fearful and speculative activity which is not likely to yield them much glory or the taxpayer much profit, but is certain to leave the taxpayer with heavy losses to meet.
      For those reasons I moved the Amendment. I am conscious that the right hon. Gentleman thinks that the Bill is non-controversial, because he is so satisfied with his own motives for bringing it forward, but I am not. I believe that it is a bad Bill, and I question whether the many authorities set up under it are competent or have the necessary judgment to exercise.
      Sir G. Nabarro: The whole House should be grateful to my hon. Friend the Member for Yeovil (Mr. Peyton) for the foresight he has demonstrated in seeking to exclude the words "in the opinion of that authority". I want to add a good deal to what my hon. Friend said, for who is that authority we are talking about? It might be the Minister of Technology, a Secretary of State, the Board of Trade, the Minister of Public Building and Works, the Minister of Transport, the Minister of Agriculture, Fisheries and Food or the Minister of Health. Those are the right hon. Gentlemen who ultimately are responsible for recommending to Parliament the future success of commercial and industrial enterprises which they seek to acquire under the Bill. What are their qualifications for making that judgment? Absolutely none.
      Lieut.-Colonel Sir Walter Bromley-Davenport: They are oafs.
      Sir G. Nabarro: I did not say that. They are very worthy men. They are dedicated to Parliament. They are professional politicians who know nothing whatever about commerce, trade and industry. Parliament itself is very bad at debating scientific, industrial and commercial matters. Parliament does not

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      understand these things. Nor do Ministers understand them.
      The greatest service to the nation, in a medium of mass news distribution, that has been performed in recent years was when the Daily Mail published a few months ago a picture gallery of every member of the Cabinet. Underneath every picture it sought to set down what was the business experience of the Cabinet Minister concerned. The sum total of any real industrial experience could easily have been written on the back of a 2½d. stamp. The article said that the Prime Minister at one time in his career had been an adviser to Montague L. Meyer Ltd., timber importers and distributors. It said that the present Chancellor of the Exchequer had at one time been an advisory director of the John Lewis Partnership—
      Mr. Speaker: Order. The hon. Gentleman must come to the Ministers who are mentioned in the Bill.
      Sir G. Nabarro: I am sorry, Sir, but I think that the names of most of the members of the Cabinet are on the back of the Bill. It is true that the names of the Prime Minister and the Chancellor of the Exchequer are not. I apologise to you, Sir, for mentioning them. There is a Money Resolution to the Bill and the Treasury ultimately has to find the money. I will not repeat the names of those two Ministers. They are the two exceptions who, according to the Daily Mail, had a modicum of industrial and commercial experience. None of the Ministers named in Clause 1, so far as I am aware, has ever been employed as an industrial executive. Yet those Ministers are the competent authorities under the Bill.
      If it be argued that they themselves will not take the decision as to the enterprises to be acquired under the Bill but will be merely the Parliamentary spokesmen making the justification for acquiring the enterprises, I make this answer. I know that the Minister of Technology would never hide behind his Civil Service advisers but would take the full Parliamentary responsibility. That is why he is named first. He has no industrial experience on which to form a judgment. He would collect and collate all the information handed to
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      him by his Civil Service advisers and then would come to the House with his judgment and make his recommendation.
      Mr. Benn: The hon. Gentleman is not, I hope, arguing that it would be wrong for this Government, made up of people whom he is in the process of criticising personally, to support industry, on the grounds that their own industrial experience would not justify it. I take it that he is not saying that, because I have not worked in the aircraft industry, I should not support the Rolls Royce aircraft engine for the American airbus. The basis of Ministerial responsibility is election. That is how we came here. That is the only reason why we are here. It is not our qualifications but the fact that our electors have chosen us.
      Sir G. Nabarro: I have been debating happily with the right hon. Gentleman for many years—on television, in the House, and elsewhere. I know his tricks and his habits very well. He puts a question to me which goes very wide of what I was talking about. No Minister of the Crown can have detailed knowledge or experience of every kind of industrial enterprise. I will give the right hon. Gentleman precisely the type of example I have in mind. Last Monday week—I think that I have the date correct—the right hon. Gentleman made a statement about the computer consortium.
      Mr. Benn: Last Thursday.
      Sir G. Nabarro: You, Mr. Speaker, kindly called me to ask a supplementary question. I put it to the right hon. Gentleman straight away that he was infusing £15 million of public funds through the instrument of the Bill into the computer merger, as he calls it. I prefer to call it a consortium.
      Mr. J. T. Price: £17 million.
      Sir G. Nabarro: I am doing this out of my head—£17 million, instead of £15 million. The question I put to the right hon. Gentleman was a fundamental one: why was not this £17 million raised through normal stock market channels in the City of London? The right hon. Gentleman came back with an innocuous reply to the effect that it was not possible to raise it. It was not—under a Labour Government.

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      The proven profits of these enterprises and their profit prospects for the future were more than adequate to raise that money through normal stock market channels.
      I will tell the hon. Gentleman why he is adverse to the money being raised in that way. It is because it exactly attaches itself to my argument on the Amendment. The right hon. Gentleman is hostile to the Government not having a stake in this consortium or merger. He wants a part of it nationalised as a springboard for further nationalisation later. That is the gravamen of my charge against the Bill. That is why it is so odious to me and why I am opopsing it at every stage.
      Mr. Benn: The hon. Gentleman will remember the answer that I gave him, which was that £10½ million of the £17 million was a research and development grant. I would like to find a merchant banker who would give a £10½ million grant to any business. The fact is that this operation would not have taken place without Government support, and the hon. Gentleman must know it.
      Sir A. V. Harvey rose—
      Mr. Speaker: Order. We cannot have an intervention on an intervention.
      Sir G. Nabarro: My reply to the right hon. Gentleman is that his intervention was poppycock. I will give him precisely the precedent for what I would have recommended in these circumstances. A few years ago a Dutch firm of nylon spinners wished to establish in a development area in Northern Ireland under a Tory Government. The name was British Enkalon. The firm advertised for prior charge funds. In its prospectus the firm stated unequivocally that there would be no servicing of the capital subscribed for a period of five years; in other words, people who invested would get no dividend for the first five years. The money the firm needed was over-subscribed in a few days. It is no good the Minister shaking his head. I have forgotten more about these things than he knows. Exactly the same thing could have been done with the £17 million on the computer merger.
      Sir A. V. Harvey: To reinforce that argument, may I remind my hon. Friend that on the Rolls Royce deal in America only last week, Lazards, Lord Poole and
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      others committed through a consortium £50 million to under-write the purchase of aircraft which enabled the deal to go through.
      Sir G. Nabarro: I am grateful to my hon. Friend. Of course, the money would be available through normal and conventional stock market channels, as the computer money would have been available had the Government wished it to be available. The right hon. Gentleman did not wish it to be available. He wanted to subscribe it—first to justify the Bill, and secondly in pursuit of his nostrum of nationalisation.
      The Ministers of the Crown named in Clause 1 are not competent judges as to the viability and future profit prospects of enterprises to be acquired under the Bill. Nor is the Civil Service. My hon. Friend the Member for Yeovil touched on, though he did not spell out the words, the concluding part of subsection (1):
      "any industrial project…would not be undertaken without such financial support as is authorised by this section."
      In other words, public funds are to be injected only into enterprises which cannot raise the money. That is a pretty state of affairs. All that the Minister will gather round him in future will be a large flock of lame ducks that cannot raise their money anywhere else, so they will go to the Government for it.
      Mr. J. T. Price: Wiggins Teape.
      7.0 p.m.
      Sir G. Nabarro: The hon. Member for Westhoughton (Mr. J. T. Price) has sat in his place for a couple of hours bleating, "Wiggins Teape", "Wiggins Teape"—ad nauseam "Wiggins Teape". Wiggins Teape is a firm of paper manufacturers. There were very special conditions in the development area that made it desirable for Government money to be put into the firm. I was one of the hon. Members, at that time on the opposite side of the Chamber, who, year after year, pressed Tory Administrations for 100 per cent. depreciation arrangements for development areas in order to attract new industries. Wiggins Teape was a special case in a development area. We are not talking about Wiggins Teape today, but about a proliferation of nationalisation, and public funds being used for acquiring enterprises that cannot raise their money elsewhere

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      through normal, orthodox and conventional channels. Do let us understand what we are talking about.
      Nor are the Minister's civil servants competent to judge. I have the utmost regard for the Civil Service—for the professional Civil Service—but—
      Mr. J. T. Price: The hon. Gentleman seems to be enjoying himself a great deal. I suppose that the House, too, enjoys this sort of theatrical extravagance which he is so fond of using. He is condemning people who cannot raise the money on the money market in the ordinary way. He says that they are not worthy of support if they cannot raise the money in the City. Perhaps he will address that argument to the pioneers who started our atomic energy industry. His own Government, by Acts passed in this House, nationalised the atomic energy industry, which could itself never have raised the hundreds of millions of pounds necessary for its development. Public funds were needed there.
      Sir G. Nabarro: I would be straying into the subject matter of later Amendments if I went in depth into the history of atomic development. Further, it would be largely irrelevant to this present argument, because the splitting of the atom at Cambridge in the 'thirties and all the consequences that flowed from it were so largely developed in time of war for weapons of destruction. That is not a question of the investment of private or of public capital. It is an entirely different consideration. Whether or not we were right to use the atomic bomb in 1945 is largely a moral issue. It is part of history, but it has nothing whatever to do with this Bill.
      I say to the right hon. Gentleman that civil servants are ill qualified to judge commercial matters. How are they to judge them? They will take the accounts of the company perhaps for a period of five or 10 years. They will see whether there is a clear auditor's certificate. They may take merchant banking advice or joint stock banking advice on the particular enterprise, and examine and cross-examine its executives. All that will be done at Civil Service level. The company will then demonstrate that for this or that reason it cannot itself raise the money it wants through normal, orthodox
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      and conventional channels, but must have public money in order to survive. In the end, the Ministry will have to judge whether it is in the public interest, whatever that may mean, that public moneys instead of private moneys should be put into the company.
      I am hostile to these processes. There is only one criterion for the injection of money into a commercial or industrial enterprise, and that criterion is the earning of future profits. As I expected, the right hon. Gentleman nods his head in dissent, but he is a Socialist and I am a Tory—
      Mr. Benn: That has nothing to do with it.
      Sir G. Nabarro: It has something to do with it: it is political philosophy. The Minister believes in public enterprise, and I do not believe in public enterprise—
      Mr. Benn: The simple fact is that we would not have had any aircraft industry in the country without public money. The hon. Gentleman does not address himself at all to the problem of how we would remain in the field of advanced technology.
      Sir G. Nabarro: I cannot on a narrow Amendment of this kind talk about the aircraft industry, but when it is in order I will take on the right hon. Gentleman, here or elsewhere, on aeronautics or computers. My knowledge is at least as good as his, historically and otherwise, and I dissent absolutely from his statement that there would be no aircraft industry in this country had not the Government—
      Mr. Speaker: Order. We are straying from the Amendment, which is directed to a very narrow point.
      Sir G. Nabarro: I agree, and I apologise to you, Mr. Speaker. The Minister, who is a Privy Councillor, should know better than to lead me astray.
      I therefore hope that, for all the reasons that my hon. Friend the Member for Yeovil (Mr. Peyton) and I have explained to the House, the right hon. Gentleman will feel constrained to accept the Amendment, which is important. The debate has been a good exercise, because I do not believe that either a Minister of the Crown or his Civil Service advisers are competent to judge the future viability or profitability of an industrial enterprise.
      Mr. J. T. Price: I ought not to be tempted to join in the debate at this hour, but I should like to congratulate the hon. Member for Worcestershire, South (Sir G. Nabarro) on taking this occasion to proclaim his prejudice once again in such loud and theatrical tones on such a narrow point as we have before us. He has taken great advantage of the Chair, and I hope that I shall not trespass in a similar way.
      The hon. Member is very fond of arrogantly—if I can use that word in his presence, because I prefer to do that rather than use it behind his back—condemning lion. Members on this side for having no kind of business sensibility. To say that they have no knowledge of industrial organisation, no competence to express commercial judgment on matters after taking professional advice, is complete nonsense. The hon. Gentleman has great commercial experience. He has acted as chairman of directors of a very important company. Nevertheless, I will bet my bottom dollar, which is much lower in ray pocket than his dollars are in his pocket, that he has never in his life taken an important commercial decision with-cut consulting solicitors, accountants and engineers, and making use of all the apparatus available in the professional world for assisting people who are some-times very ignorant business men but who wield very great power in some great commercial corporation. When one meets some of them, one wonders how on earth they ever got to their position.
      I do not want to be unfair to the hon. Gentleman, but it is nonsense on his part to speak like that to intelligent people who have been at least reasonably educated, who have moved about in the world, and have knowledge of industry. The hon. Gentleman knows that he cannot throw those epithets at me. I have knowledge of industry. I have met industrialists at all levels from top to bottom. They are all the same to me: I do not make a fuss of the man at the top because the man at the bottom wears a cap. The hon. Member for Cirencester and Tewkesbury (Mr. Ridley) made a disparaging remark about the cloth cap mentality of the Labour Party which I deplore.
      The hon. Member for Worcestershire, South entertains the House. It is good 446
      to have a few eccentrics in the place. If I may say so, there are too many people here who are so miserable in doing a serious job. One does not need to be miserable to do a serious job. If someone wants a polemical debate, I do not mind giving way to anyone who disagrees with me. If I may say so, the hon. Member earns my respect because he likes the knockabout and rough-and-tumble of politics, which is what this place is about. Too many hon. and right hon. Members—and I do not here refer to my right hon. Friend the Minister—come here with a stiffly prepared brief—
      Mr. Speaker: Order. I am afraid that I must be miserable, and call the hon. Member to order.
      Mr. Price: I apologise for that little animadversion, Mr. Speaker. I will not use Italian words, as the hon. Member for South Worcestershire did in my pre-sense in another debate, I can use one or two, but it would sound pretentious—
      Sir G. Nabarro: Desiderata.
      Mr. Price: And spaghetti to you!
      I only want to say, although I may be a heretic, that if the hon. Member for Worcestershire, South had lived in the Middle Ages he would have been highly qualified to exercise the powers of the Grand Inquisitor. He sees wicked Socialists under every bed, and every argument he ever advances in this place is directed to an ideological plane. This does not make sense in the modern world. In a society where we have a mixed economy it behoves us all, regardless of our previous positions or philosophic outlook, to do the best we can for our country within the context of what is possible at any given time. That is what my right hon. Friend is doing with this Bill.
      I want to add this. I have sometimes, perhaps, in this House created a sense of being a little off beat, because of some of the things I have said, but which I honestly believe to be true, but the suggestion that we are ideologically committed to not raising money by any means other than through the Budget is something which I do not accept. There is a growing number of people on this side of the House who share my belief that,

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      to provide the necessary funds for financing industry and to meet commitments in our nationalised industries, we might do it in the way the Italians do in certain respects. The hon. Gentleman is quite wrong.
      I do not speak only of the present Government or as a supporter of the present Government. The Italian and other Governments dealing with nationalised industries have sought some other means than the below-the-line budget procedure for raising the vast sums which are required. I have spoken on a number of occasions in this House, I hope temperately, of what the Italians have done about this, and it is quite wrong to suggest that we are committed not to use the money available in the market for financing these projects. I do not see why we should not go to the market, but perhaps that is a subject for another debate.
      I only felt in duty bound to get up to try to dispel some of the grotesque illusions which the hon. Gentleman was trying to project. They do not apply to my right hon. Friend the Minister of Technology.
      Mr. Victor Goodhew: The hon. Member for Westhoughton (Mr. J. T. Price) hit one nail firmly on the head at the beginning of his speech when he told us that businessmen refer for advice to solicitors and accountants and so on, but what he omitted to say was that those businessmen are men of judgment and, at the end, having collected the advice, are competent to make a judgment.
      Here we have a collection of Ministers 'who are supposedly, under the Bill, "competent authorities", but they are members of an Administration which has proved to be the most incompetent within living memory. This is perfectly true. Hon. Members opposite may laugh. I am glad they appreciate that it is perfectly true. It is not too much of a joke to the country. But this is so. Just consider what they have to form judgments upon—whether something will
      "improve the efficiency and profitability of an industry".
      Good heavens, the present Administration have brought the economy of this country to the verge of bankruptcy. They have succeeded in gradually grinding
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      down the profitability of this country by restriction and Government interference. They have showed their lack of judgment in the Budget which they introduced the other day.
      Mr. Speaker: We cannot now debate the Budget. There is a Finance Bill coming for Second Reading some time.
      Mr. Goodhew: I would not dream of debating the Budget. I was only citing it as an example of the lack of judgment by right hon. Gentlemen opposite, and as evidence of their incompetence. As to profitability, they are prejudiced against profit, in any event, and they display that in all their economic decisions and measures. It is very unlikely that they will ever be able to encourage profitability or to see how it can be encouraged.
      Then the "competent authorities" are to judge what is calculated
      "to promote or support technological improvements".
      This selection of competent authorities among right hon. Gentlemen opposite comprises members of an Administration who cancelled the HS681, the P1154 and the TSR2, three of the most advanced aircraft ever under way in the British aircraft industry. They are to decide whether a particular industry or section of it will be able to improve its technological processes. Goodness me, even now, having cancelled the TSR2 three years ago, they are dodging from pillar to post, and have not decided what industry should be allowed to produce to replace it—three years later.
      We cannot go on dithering in this way. This is something very much in the right hon. Gentleman's field, and something on which the country, certainly the R.A.F., depends. It is surely a matter of technological improvement, but the aircraft industry is stuck with the Government's constant interference. The Government are constantly changing their minds about what they want, and failing to judge exactly at the right moment what is needed.
      Therefore, I support my hon. Friend's Amendment. I would wholeheartedly like to see these words "in the opinion of that authority" removed from the Bill, because I believe that it is sheer nonsense to list in the Bill these right hon. Gentlemen as "competent authorities".
      7.15 p.m.
      Mr. Moonman: At first sight, the Amendment would appear to be reasonable, as some of the statements which have been made would seem to be. One would have to put on one side the speech we heard from the hon. Member for Worcestershire, South (Sir G. Nabarro), although he was, in a sense, being brutally frank about the Tory Party motivation towards both the Bill and the Government. He dislikes the "competent authorities" concerned being a number of Ministers, and civil servants who will advise in the taking of decisions. He wants to replace them with the myth of the miracle manager.
      The myth of the miracle manager is something which I would have thought even the Tory Party, 1968 would have latched on to, but in fact this was always E very dubious proposition. It was a dubious proposition because, of course, the miracle manager was associated with the genius of an individual who built up a business, but that individual has not really been around for a number of years now. There are about 20 companies in this country with senior executives who may fall into this class, but they are changing at a pretty rapid rate. Indeed, one might argue whether certain companies could even afford the genius.
      The whole concept in decision making, it seems to me, whether it be in Government or whether it be in industry, has changed. Therefore, I think it quite wrong to make the sort of attack which has been made upon the "competent authorities" and to suggest that the rôle of Ministers is any different from that of chief executives in business enterprise. There is no difference whatsoever. If hon. Members opposite find it rather distasteful that Ministers would have to collect advice and information, then I can only say that they do not really understand what is going on in modern society. The hon. Gentleman would only perpetuate the myth of the miracle manager, and perpetuate the myth of some sort of business in which the miracle manager operates. I put it to him that there is a very great difference in the way in which decisions are made in our affairs.
      I agree that at an earlier stage of the Bill we had a very important debate when many of us expressed reservations about
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      the Bill, but there is the problem of how industry can make a meaningful contribution to government and how far the Government can bring about the right sort of discussion in industry, for it is one of the facts of life that over the last 10 years Government and industry have collaborated; industry has accepted the fact that the Government must have some influence in industry, and enlightened industrialists, including the C.B.I., are concerned with working out the right sort of rôle of Government and industry, rather than saying that the Government rôle does not exist. The idea that there is such a conflict and that the Government of the day can be ignored disappeared a long time ago.
      Therefore, even with all the doubts and difficulties, there is no doubt that the competent authorities indicated in the Clause based upon the criteria laid down and amplified in the Clause, must afford some sort of guarantee although, perhaps, not as much as some of us would like.
      Sir A. V. Harvey: I support what my hon. Friend the Member for Yeovil (Mr. Peyton) has said. We have heard from the benches opposite about taking advice. Anybody who injects money into a new industry, either partially or as a takeover, takes advice. The trouble with the Government is that they never take advice. They ask for it but they do not follow through.
      I will give the Parliamentary Secretary an instance of the Government having a large majority holding in a company—Short Bros., of Belfast. I am glad to see that we have with us my hon. Friend the Member for Belfast, East (Mr. McMaster), whom I always think of as the hon. Member for Short's. The Government had something like a 75 per cent. holding in the equity, but what did they do about it?
      I remember the right hon. Member for Belper (Mr. George Brown), three years ago almost to the day, from his position on the Government Front Bench as a Cabinet Minister, saying that it was only a question of time before the Government would do this, that and the other in the manufacture of machine tools at Shorts. Nothing more was ever said about it. It was simply a damp squib, like so many of the things which the Government say they will do. There is no follow-through.

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      Only last autumn, Short's was left several months without a chairman. It had the greatest difficulty in getting a new chairman after the Government had quarrelled with the very good one who was already there. The Government member of the Board resigned. It was a glaring instance of Government interference which could not be more exacting.
      The Government have shown their failing all along the line. Not only did they cancel the TSR2, but they put a steamroller over the jigs and tools to make certain that had a Tory Government been returned when the country gave its verdict 18 months later, there would be no question of rebuilding the aircraft. It would have been a far cheaper proposition today compared with the cancellation charges of the F111A. We have not yet been told what those cancellation charges will cost, but it could well be between £50 million and £80 million. That takes a good slice of the gilt off the Rolls Royce contract.
      When the Minister of Technology, who has now left the Chamber, made his statement about the Rolls Royce contract on Monday, he said what a clever Minister he had been. He might have said a little more about his hon. Friend the Minister of State, who has for three years played a major rôle in trying to get aircraft contracts, whether in the Middle East or elsewhere. The Minister of Technology, however, is arrogant. He talks to us like a schoolmaster who knows all the answers. It is wrong for a Minister to adopt the line taken by the right hon Gentleman.
      It all boils down to a question of confidence. The Government do not have the confidence of industry. I recognise that there must be Government intervention in many projects, but as the years go by these things can be done only if there is confidence on both sides. At present, that is missing.
      The Joint Under-Secretary of State for Economic Affairs (Mr. Edmund Dell): It is a little unfortunate that the hon. Member is making the point when my right hon. Friend is absent. In his statement about Rolls Royce, my right hon. Friend paid full tribute to the part played by my hon. Friend the Minister of State.
      Sir A. V. Harvey: I am sorry that the Minister of Technology is not present.
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      I did not ask him to leave the Chamber. He left of his own accord. If he wanted to follow the debate, he would sit here and listen. I thought that he could have paid a far greater tribute to his hon. Friend the Minister of State, and I am glad that the hon. Gentleman is here to hear me say it.
      I hope that the Government will have second thoughts about this matter because it could lead them and the taxpayer into trouble. These things must be approached gradually and on a basis of confidence on both sides. Today, however, the confidence is missing.
      Mr. Emery: There is no doubt that my hon. Friend the Member for Macclesfield (Sir A. V. Harvey) has put his finger very much on one of the main problems of any aspect of co-operation between Government and industry, and that is the need for confidence on both sides in working towards co-operation. The sort of cancellation of contracts which my hon. Friend the Member for St. Albans (Mr. Goodhew) has mentioned does little to build up that confidence.
      There is one aspect of the excellent Amendment of my hon. Friend the Member for Yeovil (Mr. Peyton) which should be of considerable concern to the Government. To allow the competent authorities to be as many in number as the Government intend means that any Tom, Dick or Harry will be able to judge what is a competent scheme. There would be much more sense in having one authority to make a management decision on schemes of this sort instead of having all the Ministers, having to have all their advisers and, supposedly, all experts to cover all aspects—financial, economic, legal and accounting—that a scheme embraces.
      In my view, it would be much more sensible to have simply one Minister, perhaps the Minister of Technology, or, if not him, the Minister of Technology and the President of the Board of Trade together, as the people who should make the judgment rather than to have as competent authorities every Secretary of State—presumably the Secretary of State for Scotland, the Secretary of State for Defence, the Secretary of State for Commonwealth Relations, or for Wales or for Foreign Affairs. This seems to me to be a foolish, wide spread of authority

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      in the Bill. Therefore, the slight limitation proposed by my hon. Friend the Member for Yeovil should commend itself to the House.
      The Joint Parliamentary Secretary to the Ministry of Technology (Dr. Jeremy Bray): As you remarked, Mr. Speaker, the Amendment addresses itself to a narrow point in the Bill. We are dealing with the question of whose judgment it shall be that an industrial project is likely to conduce to the benefit of, or, if the House accepts a subsequent Amendment, is likely to benefit, the economy and who should exercise that judgment, not simply as a matter of executive decision, but the responsibility as laid down by Statute and, therefore, a matter which might have to be adjudged and decided in the courts.
      If the Amendment were accepted, what would happen would be that any project could he a matter for a court case. I do not think that any hon. Member opposite would like to leave the commercial judgment, which, they have quite rightly pointed out, is needed in this kind of project, to a court of law.
      Sir G. Nabarro: The hon. Gentleman has not explained why it would have to be a court of law. Parliament decides the scheme.
      Dr. Bray: Suppose that Parliament accepts a scheme and there is challenge as to whether it will conduce to benefit. It would certainly be a matter which would be taken to court. I take the point made by the hon. Member that some kind of tribunal could be set up to which judgment of a commercial character of this nature could be referred. I do not think that any hon. Member would suggest—certainly, no member of the Standing Committee which dealt with the Bill suggested—any such procedure. There is provision in the Bill for an advisory committee, and this surely is the right way to proceed on a particular project.
      Sir G. Nabarro: Clause 1 is quite specific. It refers to schemes
      "laid before Parliament and approved by resolution of the House of Commons."
      As long as a scheme, as explained later in the Bill, is for the benefit of the economy of the United Kingdom, it is
      454
      valid and within the competence of the Bill. Why a court of law?
      7.30 p.m.
      Dr. Bray: Because it is a question of who is to decide whether it is to the benefit of the United Kingdom.
      Mr. Stanley McMaster: Is not this an administrative decision? Are such decisions usually referred to the courts?
      Dr. Bray: It is an administrative decision and responsibility for it is clearly placed on the competent authority.
      Much of the debate could more properly have taken place on Amendments about the advisory committee. I know that hon. Members opposite take the view that the provisions about the advisory committee should be somewhat different, although not in practice greatly different. However, I shall address myself to some of the wider issues and I shall deal first with the argument of the hon. Member for Yeovil (Mr. Peyton) who said that the authorities were not competent.
      The hon. Gentleman felt that the Rolls Royce example was obviously to the benefit of the United Kingdom, but as he enthusiastically embraced that project one had a shadow of doubt about whether in matters about which he was enthusiastic he would be as critical in his appraisal of projects as most of his hon. Friends would like him to be. Certainly there must be careful provision to ensure that Ministers are not carried away by untutored or incompletely informed enthusiasms.
      Mr. Peyton: I do not know what the hon. Gentleman is getting at when he says that I am not as critical as my hon. Friends would like me to be. I assure him that I am very critical. I mentioned the Rolls Royce example only to show that I was not blindly so, that I was not dogmatic. I accept that Rolls Royce needs help. With all respect to the hon. Gentleman, what I was saying was that I did not fancy his judgments or those of his hon. Friends.
      Dr. Bray: But the hon. Gentleman enthusiastically endorses my right hon. Friend's judgment in the Rolls Royce case. He questioned the decision about

      455
      Beagle and he did not express an opinion on the computer merger.
      The hon. Member for Worcestershire, South (Sir G. Nabarro) questioned the ability of Ministers to judge within the framework in which they operate, quite rightly advised by officials. I am sure that he is aware that Ministers are advised by the same professional advisers who are available to private industry, as my hon. Friend the Member for Westhoughton (Mr. J. T. Price) has observed. The hon. Gentleman questioned whether in all the circumstances Ministers should be charged with responsibility for the final decision.
      The advisers in the computer merger were Morgan Grenfell, Lazard Brothers, S. G. Warburg and the Government's own advisers, Cooper Brothers. It would not be easy to find a more competent set of professional financial advisers. As is likely with any project under the Bill, the computer merger involved technical and industrial knowledge and appreciations beyond the purely financial. Who in this country is competent to advise on the technical and industrial aspects of the computer merger? We had all the executives in the companies themselves intimately involved in the discussions of what was the appropriate merger to seek, which was not a problem with an obvious solution. We had professional advisers who were foremost in the computer indutry and who are the advisers to the Ministry of Technology on computers. Their unanimous conclusion was that this was the right merger and that the arrangements made the industrial objectives achievable.
      We have demonstrated that the machinery of the Bill properly used by a Minister with all the range of advice available to him—and the House would be unwise to accept the dismissal by the hon. Member for Worcestershire, South of the value of our advice in these matters—enables a Minister to make the right kind of judgments on projects. We shall later have the chance to discuss the workings of the advisory committee, but it would be out of order to discuss them now.
      My hon. Friend the Member for Billericay (Mr. Moonman) rightly emphasised the importance and scarcity of good management and the necessity to make
      456
      the best use of such knowledge and advice. That is certainly our intention. We keep closely in touch with company executives and we get a great measure of co-operation from them. My hon. Friend the Minister of State is well able to survive the embarrassing embrace of the hon. Member for Macclesfield (Sir A. V. Harvey), but perhaps that was a demonstration that hon. Members opposite are beginning to pick and choose projects. This is wholly right and one hopes that the attitude of the House will be that both sides will dispassionately judge the merits of projects as they are put up and that hon. Members opposite will support some Orders and oppose others. That will be as it should be. That very prospect establishes the fact that the machinery here provided for the opinion of the Minister to be the determinant of whether a project is to the benefit of the economy is the right machinery, and the House would be well advised to reject the Amendment.
      Mr. David Price: The hon. Gentleman began and ended his speech by suggesting that without the phrase "in the opinion of that authority" it would be legally difficult to decide who should determine whether the criteria for proving efficiency and so on had been met. In normal administrative arrangements that argument would be valid, but the intervention of my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) was relevant. This part of the Bill appertains only to a Minister promoting a scheme. A Minister cannot promote a scheme under Clause 1 without coming to the House and presenting an Order, and I should have thought that as a matter of law responsibility for certifying that a scheme adhered to the criteria laid down then passed from the Minister to Parliament collectively.
      If I am right it is not necessary to have this phrase, "in the opinion of the authority".
      Dr. Bray: The hon. Member asks: Why a court of law? Given the particular machinery of this Bill, where the objective criteria for making this Scheme or Order are laid down, the fact that Parliament has approved the Order or Scheme does not prevent it from being held ultra vires in the courts if the criteria are not satisfied.
      Mr. Price: With respect, once Parliament approves it, because it is the only authority to approve an Order within the context of this Bill, Parliament then determines whether the Order falls within the criteria. Parliament is surely the ultimate High Court?
      Dr. Bray: The hon. Member misses the point, that it is through a Statutory Instrument that Parliamentary approval is given, and not further legislation.
      Mr. Price: I do not wish to detain the House any longer on this point, because l suspect that neither I nor the Parliamentary Secretary are sufficiently learned in the law to pursue the argument any further. I am not persuaded of his argument in the instance of the procedures of this Bill, although I accept it in general administrative law, where general powers are given under an Act.
      He and his right hon. Friends have been raising the computer merger. I do not intend, Mr. Speaker—and I would like to give you notice about this—to raise anything to do with the statement made by the right hon. Gentleman the other day. In due course we will have a proper opportunity to debate it. It is far too important and serious to be brought in through the back door, used to illustrate an argument, to make a point on either side. I hope that the right hon. Gentleman and the House will forgive me if I do not go further, however much anyone may try to provoke me into saying anything. If the argument is raised, I would say that the first question which I would wish to discuss is whether a national merger is necessary.
      Hon. Gentlemen who did not take part in Committee proceedings may like to know that we discussed this point, and all that flowed from it. Most of the arguments were used in Committee. We attempted to narrow down the number of competent authorities from the
      "Widdicombe Fair" Clause to one, because we believed that many of the arguments used would have been less valid if there was one authority and not many. We have lost on that. We have tried to tie the opinion of that authority, which is the phrase we are on at the moment, to having to get the positive recommendation of the advisory committee in each case. That, again, failed. Therefore, in Standing Committee we were not satisfied about this. Some of the arguments used then have been used again today, and I do not think that anything more can be added. On this side of the House we are not really happy about it at all.
      Mr. Peyton: May I speak by leave of the House? The Parliamentary Secretary must recently have had a little practice in the art of: "If you are unable to answer an argument, then you alter it to one which you can." He certainly adjusted mine to suit his own convenience. The point is that one of the effects of the Amendment is to heighten the burden of proof that such an investment or project is really likely to conduce to the benefit of the economy.
      What I want the Parliamentary Secretary to understand is that because on one or two occasions the Government have laudably taken good advice, and have even embarked upon profitable and successful schemes, this is no reason why Parliament should accept this sort of Clause in a Bill like this, which means that it is endorsing, under all circumstances a Ministerial "say-so". I do not like that, and for that reason I hope that, with the encouragement given by my hon. Friend, we shall vote in favour of the Amendment.
      Question put, That the Amendment be made:—
      The House divided: Ayes 148, Noes 198.

      Division No. 105.]

      AYES

      [7.45 p.m.

      Alison, Michael (Barkston Ash)

      Brewis, John

      Costain, A. P.

      Astor, John

      Brinton, Sir Tatton

      Craddock, Sir Beresford (Spelthorne)

      Awdry, Daniel

      Bromley-Davenport, Lt. -Col. Sir Walter

      Crouch, David

      Baker, K. W. (Acton)

      Brown, Sir Edward (Bath)

      Crowder, F. P.

      Baker, W. H. K. (Banff)

      Bryan, Paul

      Dalkeith, Earl of

      Beamish, Col. Sir Tufton

      Buchanan-Smith, Alick (Angus, N & M)

      Dance, James

      Bell, Ronald

      Buck, Antony (Colchester)

      Davidson, James (Aberdeenshire, W.)

      Bennett, Sir Frederic (Torquay)

      Campbell, Gordon

      Dean, Paul (Somerset, N.)

      Bessell, Peter

      Carr, Rt. Hn. Robert

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

      Black, Sir Cyril

      Channon, H. P. G.

      Digby, Simon Wingfield

      Blaker, Peter

      Chichester-Clark, R.

      Doughty, Charles

      Boardman, Tom

      Corfield, F. V.

      Eden, Sir John

      Elliot, Capt. Walter (Carshalton)

      Jopling, Michael

      Ridsdale, Julian

      Emery, Peter

      King, Evelyn (Dorset, S.)

      Rossi, Hugh (Hornsey)

      Eyre, Reginald

      Kirk, Peter

      Royle, Anthony

      Farr, John

      Kitson, Timothy

      Russell, Sir Ronald

      Fisher, Nigel

      Knight, Mrs. Jill

      Scott, Nicholas

      Fletcher-Cooke, Charles

      Lane, David

      Scott-Hopkins, James

      Fortescue, Tim

      Langford-Holt, Sir John

      Sharples, Richard

      Foster, Sir John

      Lubbock, Eric

      Sinclair, Sir George

      Galbraith, Hon. T. G.

      MacArthur, Ian

      Stainton, Keith

      Gibson-Watt, David

      Maclean, Sir Fitzroy

      Steel, David (Roxburgh)

      Gilmour, Sir John (Fife, E.)

      McMaster, Stanley

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

      Godber, Rt. Hn. J. B.

      Maddan, Martin

      Taylor, Frank (Moss Side)

      Goodhew, Victor

      Maginnis, John E.

      Temple, John M.

      Gower, Raymond

      Mawby, Ray

      Thatcher, Mrs. Margaret

      Grant, Anthony

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

      Turton, Rt. Hn. R. H.

      Grant-Ferris, R.

      Mills, Peter (Torrington)

      van Straubenzee, W. R,

      Gresham Cooke, R.

      Mills, Stratton (Belfast, N.)

      Wainwright, Richard (Colne Valley)

      Griffiths, Eldon (Bury St. Edmunds)

      Mitchell, David (Basingstoke)

      Walker, Peter (Worcester)

      Grimond, Rt. Hn. J.

      Monro, Hector

      Wall, Patrick

      Hall-Davis, A. G. F.

      Munro-Lucas-Tooth, Sir Hugh

      Walters, Dennis

      Harrison, Col. Sir Harwood (Eye)

      Murton, Oscar

      Ward, Dame Irene

      Harvey, Sir Arthur Vere

      Nabarro, Sir Gerald

      Weatherill, Bernard

      Hastings, Stephen

      Neave, Airey

      Webster, David

      Hawkins, Paul

      Nicholls, Sir Harmar

      Wells, John (Maidstone)

      Heald, Rt. Hn. Sir Lionel

      Noble, Rt. Hn. Michael

      Whitelaw, Rt. Hn. William

      Higgins, Terence L.

      Nott, John

      Williams, W. D. (Dudley)

      Hiley, Joseph

      Onslow, Cranley

      Wills, Sir Gerald (Bridgwater)

      Hill, J. E. B.

      Orr, Capt. L. P. S.

      Wilson, Geoffrey (Truro)

      Hogg, Rt. Hn. Quintin

      Osborn, John (Hallam)

      Winstanley, Dr. M. P.

      Holland, Philip

      Percival, Ian

      Wolrige-Gordon, Patrick

      Hooson, Emlyn

      Peyton, John

      Worsley, Marcus

      Hordern, Peter

      Pink, R. Bonner

      Wright, Esmond

      Hornby, Richard

      Powell, Rt. Hn. J. Enoch

      Wylie, N. R.

      Howell, David (Guildford)

      Price, David (Eastleigh)

      Younger, Hn. George

      Hunt, John

      Pym, Francis

      Hutchison, Michael Clark

      Quennell, Miss J. M.

      TELLERS FOR THE AYES:

      Irvine, Bryant Godman (Rye)

      Ramsden, Rt. Hn. James

      Mr. R. W. Elliott and

      Jenkin, Patrick (Woodford)

      Rhys Williams, Sir Brandon

      Mr. Jasper More.

      Johnston, Russell (Inverness)

      Ridley, Hn. Nicholas

      NOES

      Abse, Leo

      Dewar, Donald

      Hughes, Hector (Aberdeen, N.)

      Allaun, Frank (Salford, E.)

      Dickens, James

      Hughes, Roy (Newport)

      Alldritt, Walter

      Dobson, Ray

      Hunter, Adam

      Anderson, Donald

      Doig, Peter

      Hynd, John

      Archer, Peter

      Dunwoody, Mrs. Gwyneth (Exeter)

      Irvine, Sir Arthur

      Atkins, Ronald (Preston, N.)

      Eadie, Alex

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

      Atkinson, Norman (Tottenham)

      Edwards, Robert (Bilston)

      Jackson, Peter M. (High Peak)

      Bagier, Gordon A. T.

      Edwards, William (Merioneth)

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

      Barnett, Joel

      Ellis, John

      Jones, Dan (Burnley)

      Baxter, William

      Ennals, David

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

      Bence, Cyril

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

      Jones, J. Idwal (Wrexham)

      Faulds, Andrew

      Benn, Rt. Hn. Anthony Wedgwood

      Fernyhough, E.

      Jones, T. Alec (Rhondda, West)

      Bennett, James (G'gow, Bridgeton)

      Fletcher, Raymond (Ilkeston)

      Kerr, Dr. David (W'worth, Central)

      Bishop, E. S.

      Fletcher, Ted (Darlington)

      Lawson, George

      Blenkinsop, Arthur

      Foley, Maurice

      Leadbitter, Ted

      Booth, Albert

      Foot, Michael (Ebbw Vale)

      Ledger, Ron

      Bottomley, Rt. Hn. Arthur

      Ford, Ben

      Lee, Rt. Hn. Frederick (Newton)

      Boyden, James

      Fowler, Gerry

      Lee, John (Reading)

      Bray, Dr. Jeremy

      Freeson, Reginald

      Lewis, Ron (Carlisle)

      Brooks, Edwin

      Galpern, Sir Myer

      Loughlin, Charles

      Broughton, Dr. A. D. D.

      Gardner, Tony

      Lyon, Alexander W. (York)

      Buchan, Norman

      Garrett, W. E.

      Lyons, Edward (Bradford, E.)

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

      Gregory, Arnold

      McBride, Neil

      Carmichael, Neil

      Grey, Charles (Durham)

      McCann, John

      Carter-Jones, Lewis

      Griffiths, David (Rother Valley)

      MacColl, James

      Chapman, Donald

      Griffiths, Will (Exchange)

      Macdonald, A. H.

      Coleman, Donald

      Hamilton, James (Bothwell)

      McGuire, Michael

      Concannon, J. D.

      Hamilton, William (Fife, W.)

      Mackenzie, Gregor (Rutherglen)

      Conlan, Bernard

      Hamling, William

      Maclennan, Robert

      Craddock, George (Bradford, S.)

      Harrison, Walter (Wakefield)

      McMillan, Tom (Glasgow, C.)

      Crawshaw, Richard

      Haseldine, Norman

      MacPherson, Malcolm

      Cronin, John

      Hattersley, Roy

      Mahon, Peter (Preston, S.)

      Crossman, Rt. Hn. Richard

      Hazell, Bert

      Mahon, Simon (Bootle)

      Cullen, Mrs. Alice

      Heffer, Eric S.

      Mallalieu, E. L. (Brigg)

      Davidson, Arthur (Accrington)

      Henig, Stanley

      Manuel, Archie

      Davies, Dr. Ernest (Stretford)

      Hooley, Frank

      Mapp, Charles

      Davies, G. Elfed (Rhondda, E.)

      Houghton, Rt. Hn. Douglas

      Marks, Kenneth

      Davies, Ifor (Gower)

      Howarth, Harry (Wellingborough)

      Marquand, David

      Delargy, Hugh

      Howarth, Robert (Bolton, E.)

      Marsh, Rt. Hn. Richard

      Dell, Edmund

      Hoy, James

      Mason, Rt. Hn. Roy

      Dempsey, James

      Huckfield, Leslie

      Maxwell, Robert

      Mayhew, Christopher

      Pentland, Norman

      Symonds, J. B.

      Mendelson, J. J.

      Perry, George H. (Nottingham, s.)

      Tinn, James

      Millan, Bruce

      Price, Thomas (Westhoughton)

      Tuck, Raphael

      Miller, Dr. M. S.

      Price, William (Rugby)

      Urwin, T. W.

      Milne, Edward (Blyth)

      Probert, Arthur

      Varley, Eric G.

      Mitchell, R. C. (S'th'pton, Test)

      Rankin, John

      Wainwright, Edwin (Dearne Valley)

      Moonman, Eric

      Rees, Merlyn

      Walker, Harold (Doncaster)

      Morgan, Elystan (Cardiganshire)

      Roberts, Albert (Normanton)

      Wallace, George

      Morris, Alfred (Wythenshawe)

      Robertson, John (Paisley)

      Watkins, David (Consett)

      Morris, Charles R. (Openshaw)

      Rogers, George (Kensington, N.)

      Watkins, Tudor (Brecon & Radnor)

      Morris, John (Aberavon)

      Rose, Paul

      Wellbeloved, James

      Moyle, Roland

      Ross, Rt. Hn. William

      Wells, William (Walsall, N.)

      Newens, Stan

      Ryan, John

      Whitaker, Ben

      Ogden, Eric

      Sheldon, Robert

      Whitlock, William

      O'Malley, Brian

      Shore, Rt. Hn. Peter (Stepney)

      Wilkins, W. A.

      Oram, Albert E.

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

      Willey, Rt. Hn. Frederick

      Orme, Stanley

      Silkin, Rt. Hn. John (Deptford)

      Williams, Clifford (Abertillery)

      Oswald, Thomas

      Silverman, Julius (Aston)

      Williams, W. T. (Warrington)

      Owen, Will (Morpeth)

      Slater, Joseph

      Willis, Rt. Hn. George

      Page, Derek (King's Lynn)

      Small, William

      Woodburn, Rt. Hn. A.

      Palmer, Arthur

      Spriggs, Leslie

      Woof, Robert

      Pannell, Rt. Hn. Charles

      Steele, Thomas (Dunbartonshire, W.)

      Yates, Victor

      Park, Trevor

      Stewart, Rt. Hn. Michael

      Parkyn, Brian (Bedford)

      Stonehouse, John

      TELLERS FOR THE NOES:

      Pavitt, Laurence

      Swain, Thomas

      Mr. Joseph Harper and

      Pearson, Arthur (Pontypridd)

      Swingler, Stephen

      Mr. Harry Gourlay.

      Mr. David Price: I beg to move Amendment No. 15, in page 2, line 8, after authority ' insert:
      'and after consultation with the advisory committee as defined in section 5'.
      In Committee we moved an Amendment which, if it had been adopted, would have made it mandatory on the competent authority to receive the recommendation of the Advisory Committee before introducing an industrial investment scheme. That Amendment did not appeal to the Government, although I think that it is fair to say that they were sympathetic to some of the purposes behind it. This Amendment does not go nearly as far, and I hope that it meets the legitimate objections of the Minister when he resisted cur Amendment in Committee.
      This Amendment proposes that the competent authority shall consult the Advisory Committee before making a scheme. We are not saying that the competent authority must abide by the recommendations of the Advisory Committee. The Minister of Technology, in replying to our Amendment in Committee, gave one or two examples of the circumstances in which he felt that it would be improper for the Minister to be bound by the recommendation of the Advisory Committee. However, I hope that the phraseology of this Amendment will enable him to accept it.
      In Committee, the Minister made three remarks which I hope will commend themselves to the House. He said:
      "No one should think that in the Ministry of Technology we are raring to go with a lot
      462
      of schemes without getting industrialists to give their views".
      Then he said:
      "The reason for the Advisory Committee is that we want to have access to advice."
      Later he stated:
      "The second motive is that we want to reassure industry that, when we enter into this kind of relationship, it can feel that business minds will be brought to play on the problems with which we have to deal".—[OFFICIAL REPORT, Standing Committee E, 22nd February, 1968; c. 107.]
      It is in the spirit of the right hon. Gentleman's comments in Committee that I move the Amendment. I hope that it commends itself to the House.
      Mr. Peyton: I feel slightly torn over this Amendment because I am not a great lover of committees, but, on the whole, I prefer this kind of committee in this kind of context to Ministers and their Departments. Therefore, I do not see why the Government should not accept this very mild Amendment. My hon. Friend the Member for Eastleigh (Mr. David Price) does not even make it mandatory for the Government to accept the committee's advice. What I presume he seeks to do is to make it slightly shaming for the Government to reject the advice of people who know much better than they do.
      I should have thought that this was a very modest Amendment, although, as I say, I have the greatest reservation in my approach to committees. They involve a great waste of valuable time. One feels that the able and experienced men who

      463
      sit on them may be better employed elsewhere. In so far as they are manned by "doves", it is better that they do not exist in any case. My approach is slightly negative, but, on balance, I am willing to support this very mild Amendment, and I cannot see why the Minister should not accept it immediately.
      8.0 p.m.
      Mr. Emery: I shall detain the House for only a few moments. It seems to me that my hon. Friend the Member for Eastleigh (Mr. David Price) has bent over backwards to meet the objections which the Government had in Committee to the Amendment I moved. They argued that it would be wrong to have a committee who could override the judgment of a Minister. I do not accept that at this stage. In Committee I mentioned the example of B.O.T.A.C. as the kind of thing which I would like to have accepted, but we lost the debate.
      If we are to have this Advisory Committee, it is imperative that it should be used. If it is there, and is not used, it will be an absolute waste of time, and the fears expressed by my hon. Friend the Member for Yeovil (Mr. Peyton) will prove to be justified. The Amendment seeks to do only one thing. It seeks to make certain that the Minister will consult the Committee he proposes to appoint. This seems a right and proper step, and one which will improve the Bill.
      Mr. Lane: I support the Amendment because I think that it will make the Bill a good deal less objectionable than it is at the moment. A matter which has troubled me a good deal ever since the White Paper was published is the way in which the Government envisage the Advisory Committee being brought into use. When the White Paper was published, a lot was said about intentions, about the setting up of the Committee, and personalities were mentioned when there was talk about who would serve on it. We then saw the Bill, and the only mention of this Committee was in the Clause establishing it, which is Clause 5. The Committee is not specifically linked in at any other point in the Bill. During the Second Reading debate I did not think that the Government were convincing in their explanation of the way
      464
      in which they would bring the Committee into being, and during the Committee stage they were extremely coy about this issue.
      There are two strong reasons for accepting the Amendment and ensuring that the Committee does not become merely a piece of window dressing. First, we all know of the doubts and misgivings which have been expressed in industry ever since the Government first talked about producing a Bill of this sort, many months ago. It will set some of these doubts and misgivings at rest if we put into the Bill the clear commitment of the Government at least to bring in the Advisory Committee for consultation over every scheme. Secondly, I do not believe that we will get men of the highest calibre to serve on this Committee unless the Government make it clear in the Bill itself that the Committee will be given a real job to do, and that real weight will be attached to its advice.
      I hope that the Government are not being shy about accepting Amendments merely because they are moved from this side of the House. If they do not accept this reasonable Amendment, I shall begin to despair of the Government's moving even an inch to meet reasonable and constructive suggestions from this side of the House.
      Mr. Benn: I appreciate the spirit in which the hon. Member for Eastleigh (Mr. David Price) moved the Amendment. I also appreciated the fact that he did not go back to the mandatory problem with which I tried to deal when answering the debate in Committee.
      There is a difficulty about accepting the Amendment, and I shall explain it to the House and hope to carry hon. Gentlemen opposite with me. The difficulty is that some of the schemes under the Bill will be general schemes. They will arise out of an entirely independent inquiry, and I cite the Geddes Inquiry into the shipbuilding industry as an example of what I mean. I think it better not to indicate possible candidates, for fear that this might be misunderstood, but there are a number of industries which might suggest to us that there are things which we can do to strengthen their competitive position.
      In those circumstances, the most important thing of all is to get a consensus

      465
      within the industry. Perhaps I can explain what I said earlier, when I probably did it badly. I did not mean that the Bill was not controversial in the sense that the party opposite did not like it. I meant that the operation of the procedure would not arouse controversy, certainly not with firms with whom we work, and I go so far as to say, though it is probably foolish to prophesy, that when the House sees the schemes, even the high passions which have been aroused at various stages may be cooled. That is my opinion, and I shall say no more about it than that.
      If we are to try to seek a consensus, and I am speaking of a general industrial scheme, the proper thing to do is to have it looked at thoroughly, because it would be foolish to move with a voluntary Bill in an industry in which there was some good to be done by agreement unless we had a thorough examination. Is it meaningful at the end to be bound to refer the whole thing to an advisory committee? Would it have been sensible if the Geddes Report had been referred to the Advisory Committee? I think the House would feel that this was over-egging the pudding, that this was going to work on more than one egg.
      In those circumstances, it seems to me that it would be wrong to have a statutory imposition even of what seems so reasonable a requirement to consult, because if the Advisory Committee had been asked to review the findings of the Geddes Committee, we all know what would have happened. It would have said, "We have looked at it, and have no comment to make", in which case it would not have been consultation, or it would have gene over the ground again, which would have been needless and delaying. I hope the House will accept that it is not practicable to have a mandatory obligation to consult.
      There is one other point which I might make, and that is that were the Amendment to be passed in this form it would rule out schemes which had developed in the period between the Bill coming forward and its enactment. There is no advisory committee at the moment. There will not be one until the Bill is enacted. At least one project which the House will have to consider and decide on has come up in embryo form ready for presentation
      466
      to the House. To impose a retrospective statutory requirement to consult a committee which has not been set up about a project which has come forward after a year's negotiation will cause serious difficulties. One might try to get round this difficulty, but it could not satisfactorily be done.
      The other case, which my right hon. Friend the Secretary of State for Economic Affairs mentioned as a possible candidate, is the smelter project, where again one can see all sorts of aspects to this which are not necessarily appropriate or right for the sort of advisory committee function that is envisaged here.
      Having said that, I want to stress to the House that the Advisory Committee is an immensely valuable and important, and, indeed, essential, part of this procedure. We have had some discussions about lame ducks. We have had a lot of fun with them, but a lame duck is no advantage to the Minister who promotes it. I assure the House that I have no desire to allow something to come forward which could be a lame duck. I recognise that the Government may be handicapped in their approach. There are pressures on the Government for political reasons, for scientific reasons, for regional reasons, and for employment reasons. The Government are always under this type of pressure. The purpose of the Bill is to promote commercial success and profitability in the industries in which it is to operate.
      The Advisory Committee will be there for any of the Ministers who are rather comically called competent authorities, but the House will know that the Parliamentary draftsmen tickle our sense of humour. Ministers are bound to want the advice of this Committee to protect them from pressures which they will want to resist. In many cases I would much rather be judged as a Minister on the things that I have killed since I have been in the Department, than by the things which I have promoted, because it is only when one says "No" to things that ought not to come forward, and they never reach the light of day, and when one declines to support projects, that one gets any idea of whether one is really applying reasonable criteria to those projects. I suppose that it would be unreasonable to expect hon. Gentlemen opposite to be as generous as this in

      467
      assessing our motivation, but the motivation of the Bill is to provide, as far as possible, the means by which British industry can be competitive in key areas; in advanced technology and—
      Mr. Deputy Speaker (Sir Eric Fletcher): Order. I do not think that on this Amendment we want a general discussion about the objects of the Bill. The right hon. Gentleman must confine his remarks to the narrow point raised in the Amendment.
      Mr. Benn: I accept your rebuke, Mr. Deputy Speaker, but I was dealing with the Advisory Committee and was explaining how the Minister would operate under the Bill.
      Mr. Deputy Speaker: Order. The Amendment deals only with the necessity to consult the Advisory Committee. I suggest that we do not want a general debate about the functions of the Advisory Committee.
      Mr. Benn: I will, of course, be guided by your ruling. I was trying to adduce as an argument for hon. Gentlemen opposite not to press the Amendment the fact that any Minister trying to operate the Bill would have a strong incentive to go to the Advisory Committee; the risk that a Bill which is designed for one purpose might, because of political or other pressures, be used in another direction. I was pointing out that a Minister might want the Advisory Committee to help him to resist something.
      If the hon. Member for Eastleigh would accept that we intend to make the fullest use of the Advisory Committee—after all, it was our idea that there should be one—then this is the greatest security. Whether or not we had gone to the Advisory Committee would be a question to be asked when affirmative Orders are laid, whereupon Ministers will be accountable for their decisions. This is about as much as one can hope for in the operation of the procedure, for if a Minister comes forward with a scheme on an affirmative Order and hon. Members ask, "Did you go to the Advisory Committee?", and he replies, "No", he would be required to explain
      468
      why. Because there may be one or two occasions when it would be reasonable for the Minister to say "No" to that question, I hope that even this apparently modest statutory requirement will not be written into the Bill.
      Mr. David Price: The Minister's main objection to the Amendment is in relation to general industrial schemes under Clause 3. That Clause requires the competent authority to make such inquiries as are thought lo be appropriate. It seems reasonable, therefore, that those inquiries should start from the Advisory Committee, even though it might decide that it did not have the facilities to conduct a proper inquiry.
      The right hon. Gentleman gave the shipbuilding industry as an example. If these powers had existed at that time, would not the Minister have gone to the Advisory Committee before the Geddes inquiry was established'? The Minister would then have asked the Advisory Committee, "What are your comments on the problems of this industry?"—and, after its recommendation, the Geddes Committee would have been established. Equally, the Minister, having heard the problems of the shipbuilding industry from those involved in it—trade unions and some manufacturers—might have asked the Advisory Committee, "Do you think that this is the sort of matter into which I should make an extensive inquiry, with the possibility of using Clause 3?". For this reason I do not believe that the right hon. Gentleman's objection to the Amendment on the grounds of Clause 3 is valid.
      Nor is his transitional problem argument valid because if a scheme had just been brought into being it would be proper for the Advisory Committee merely to look at the draft and not be desperately offended if it had only sufficient time to look into the matter briefly. On the other hand, if the Advisory Committee saw something terribly wrong with such a scheme, it would have the duty of pointing it out. Because I am not happy with the right hon. Gentleman's reply, I must advise my hon. Friends to divide the House.
      Question put, That the Amendment be made:—
      The House divided: Ayes 144. Noes 194.

      Division No. 106.]

      AYES

      [8.15 p.m.

      Alison, Michael (Barkston Ash)

      Gower, Raymond

      Nott, John

      Astor, John

      Gresham Cooke, R.

      Onslow, Cranley

      Awdry, Daniel

      Grimond, Rt. Hn. J.

      Orr. Capt. L. P. S.

      Baker, K. W. (Acton)

      Hall-Davis, A. G. F.

      Osborn, John (Hallam)

      Baker, W. H. K. (Banff)

      Harrison, Brian (Maldon)

      Percival, Ian

      Beamish, Col. Sir Tufton

      Harrison, Col. Sir Harwood (Eye)

      Peyton, John

      Bell, Ronald

      Harvey, Sir Arthur Vere

      Pink, R. Bonner

      Bennett, Sir Frederic (Torquay)

      Hastings, Stephen

      Powell, Rt. Hn. J. Enoch

      Bessell, Peter

      Hawkins, Paul

      Price, David (Eastleigh)

      Black, Sir Cyril

      Higgins, Terence L.

      Pym, Francis

      Blaker, Peter

      Hiley, Joseph

      Quennell, Miss J. M.

      Boardman, Tom

      Hill, J. E. B.

      Ramsden. Rt. Hn. James

      Boyd-Carpenter, Rt. Hn. John

      Hogg, Rt. Hn. Quintin

      Rhys Williams, Sir Brandon

      Brewis, John

      Holland, Philip

      Ridsdale, Julian

      Bromley-Davenport, Lt. -Col. Sir Walter

      Hooson, Emlyn

      Rossi, Hugh (Hornsey)

      Brown, Sir Edward (Bath)

      Hordern, Peter

      Royle, Anthony

      Bryan, Paul

      Hornby, Richard

      Russell, Sir Ronald

      Buchanan-Smith, Alick (Angus, N & M)

      Howell, David (Guildford)

      Scott, Nicholas

      Buck, Antony (Colchester)

      Hunt, John

      Scott-Hopkins, James

      Campbell, Gordon

      Hutchison, Michael Clark

      Sharples, Richard

      Carr, Rt. Hn. Robert

      Irvine, Bryant Godman (Rye)

      Sinclair, Sir George

      Channon, H. P. G.

      Jenkin, Patrick (Woodford)

      Stainton, Keith

      Chichester-Clark, R.

      Johnston, Russell (Inverness)

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

      Corfield, F. V.

      Jopling, Michael

      Taylor, Frank (Moss Side)

      Costain, A. P.

      Kershaw, Anthony

      Temple, John M.

      Craddock, Sir Beresford (Spelthorne)

      King, Evelyn (Dorset, S.)

      Thatcher, Mrs. Margaret

      Crouch, David

      Kirk, Peter

      Turton, Rt. Hn. R. H.

      Crowder, F. P.

      Kitson, Timothy

      van Straubenzee, W. R.

      Dalkeith, Earl of

      Knight, Mrs. Jill

      Vaughan-Morgan, Rt. Hn. Sir John

      Dance, James

      Lane, David

      Wainwright, Richard (Colne Valley)

      Davidson. James (Aberdeenshire, W.)

      Langford-Holt, Sir John

      Walker, Peter (Worcester)

      Dean, Paul (Somerset, N.)

      Lubbock, Eric

      Wall, Patrick

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

      MacArthur, Ian

      Ward, Dame Irene

      Digby, Simon Wingfield

      Maclean, Sir Fitzroy

      Weatherill, Bernard

      Doughty, Charles

      McMaster, Stanley

      Webster, David

      Eden, Sir John

      Maddan, Martin

      Wells, John (Maidstone)

      Elliot, Capt. Walter (Carshalton)

      Maginnis, John E.

      Whitelaw, Rt. Hn. William

      Emery, Peter

      Mawby, Ray

      Williams, W. T. (Warrington)

      Eyre, Reginald

      Mills, Peter (Torrington)

      Wills, Sir Gerald (Bridgwater)

      Farr, John

      Mills, Stratton (Belfast, N.)

      Wilson, Geoffrey (Truro)

      Fisher, Nigel

      Mitchell, David (Basingstoke)

      Winstanley, Dr. M. P.

      Fletcher-Cooke, Charles

      Monro, Hector

      Wolrige-Gordon, Patrick

      Fortescue, Tim

      More, Jasper

      Worsley, Marcus

      Foster, Sir John

      Munro-Lucas-Tooth, Sir Hugh

      Wright, Esmond

      Gibson-Watt, David

      Murton, Oscar

      Wylie, N. R.

      Gilmour, Sir John (Fife, E.)

      Nabarro, Sir Gerald

      Younger, Hn. George

      Godber, Rt. Hn. J. B.

      Neave, Airey

      TELLERS FOR THE AYES:

      Goodhart, Philip

      Nicholls, Sir Harmar

      Mr. R. W. Elliott and

      Goodhew, Victor

      Noble, Rt. Hn. Michael

      Mr. Anthony Grant.

      NOES

      Abse, Leo

      Chapman, Donald

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

      Allaun, Frank (Salford, E.)

      Coleman, Donald

      Faulds, Andrew

      Alldritt, Walter

      Concannon, J. D.

      Fernyhough, E.

      Anderson, Donald

      Conlan, Bernard

      Fletcher, Raymond (Ilkeston)

      Archer, Peter

      Craddock, George (Bradford, S.)

      Fletcher, Ted (Darlington)

      Atkins, Ronald (Preston, N.)

      Crawshaw, Richard

      Foley, Maurice

      Atkinson, Norman (Tottenham)

      Crossman, Rt. Hn. Richard

      Foot, Michael (Ebbw Vale)

      Bagier, Gordon A. T.

      Cullen, Mrs. Alice

      Ford, Ben

      Barnett, Joel

      Davidson, Arthur (Accrington)

      Fowler, Gerry

      Baxter, William

      Davies, Dr. Ernest (Stratford)

      Freeson, Reginald

      Bence, Cyril

      Davies, G. Elfed (Rhondda, E.)

      Galpern, Sir Myer

      Benn, Rt. Hn. Anthony Wedgwood

      Delargy, Hugh

      Garrett, W. E.

      Bennett, James (G'gow, Bridgeton)

      Dell, Edmund

      Gregory, Arnold

      Bishop, E. S.

      Dempsey, James

      Grey, Charles (Durham)

      Blenkinsop, Arthur

      Dewar, Donald

      Griffiths, David (Rother Valley)

      Booth, Albert

      Dickens, James

      Griffiths, Will (Exchange)

      Bottomley, Rt. Hn. Arthur

      Dobson, Ray

      Hamilton, James (Bothwell)

      Boyden, James

      Doig, Peter

      Hamilton, William (Fife, W.)

      Bray, Dr. Jeremy

      Dunwoody, Mrs. Gwyneth (Exeter)

      Hamling, William

      Brooks, Edwin

      Edwards, Rt. Hn. Ness (Caerphilly)

      Harrison, Walter (Wakefield)

      Broughton, Dr. A. D. D.

      Edwards, Robert (Bilston)

      Haseldine, Norman

      Buchan, Norman

      Edwards, William (Merioneth)

      Hattersley, Roy

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

      Ellis, John

      Heffer, Eric S.

      Carmichael, Neil

      Ennals, David

      Henig, Stanley

      Carter-Jones, Lewis

      Ensor, David

      Hazell, Bert

      Hooley, Frank

      Marks, Kenneth

      Ross, Rt. Hn. William

      Houghton, Rt. Hn. Douglas

      Marquand, David

      Ryan, John

      Howarth, Harry (Wellingborough)

      Marsh, Rt. Hn. Richard

      Sheldon, Robert

      Howarth, Robert (Bolton, E.)

      Mason, Rt. Hn. Roy

      Shore, Rt. Hn. Peter (Stepney)

      Hoy, James

      Maxwell, Robert

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

      Huckfield, Leslie

      Mayhew, Christopher

      Silkin, Rt. Hn. John (Deptford)

      Hughes, Hector (Aberdeen, N.)

      Mendelson, J. J.

      Silverman, Julius (Aston)

      Hughes, Roy (Newport)

      Millan, Bruce

      Slater, Joseph

      Hunter, Adam

      Miller, Dr. M. S.

      Small, William

      Hynd, John

      Milne, Edward (Blyth)

      Spriggs, Leslie

      Irvine, Sir Arthur

      Moonman, Eric

      Steele, Thomas (Dunbartonshire, W.)

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

      Morgan, Elystan (Cardiganshire)

      Stewart, Rt. Hn. Michael

      Jackson, Peter M. (High Peak)

      Morris, Alfred (Wythenshawe)

      Stonehouse, John

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

      Morris, Charles R. (Openshaw)

      Swain, Thomas

      Jones, Dan (Burnley)

      Morris, John (Aberavon)

      Swingler, Stephen

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

      Moyle, Roland

      Symonds, J. B.

      Jones, J. Idwal (Wrexham)

      Newens, Stan

      Tinn, James

      Jones, T. Alec (Rhondda, West)

      Noel-Baker, Francis (Swindon)

      Tuck, Raphael

      Kerr, Dr. David (W'worth, Central)

      Ogden, Eric

      Urwin, T. W.

      Lawson, George

      O'Malley, Brian

      Varley, Eric G.

      Leadbitter, Ted

      Oram, Albert E.

      Wainwright, Edwin (Dearne Valley)

      Ledger, Ron

      Orme, Stanley

      Walker, Harold (Doncaster)

      Lee, Rt. Hn. Frederick (Newton)

      Oswald, Thomas

      Wallace, George

      Lee, John (Reading)

      Owen, Will (Morpeth)

      Watkins, David (Consett)

      Lewis, Ron (Carlisle)

      Page, Derek (King's Lynn)

      Watkins, Tudor (Brecon & Radnor)

      Loughlin, Charles

      Palmer, Arthur

      Wellbeloved, James

      Lyon, Alexander W, (York)

      Pannell, Rt. Hn. Charles

      Wells, William (Walsall, N.)

      Lyons, Edward (Bradford, E.)

      Park, Trevor

      Whitaker, Ben

      McBride, Neil

      Parkyn, Brian (Bedford)

      Whitlock, William

      McCann, John

      Pavitt, Laurence

      Wilkins, W. A.

      MacColl, James

      Pentland, Norman

      Willey, Rt. Hn. Frederick

      Macdonald, A. H.

      Perry, George H. (Nottingham, S.)

      Williams, Clifford (Abertillery)

      McGuire, Michael

      Price, Thomas (Westhoughton)

      Williams, W. T. (Warrington)

      Mackenzie, Gregor (Rutherglen)

      Price, William (Rugby)

      Willis, Rt. Hn. George

      Maclennan, Robert

      Probert, Arthur

      Woodburn, Rt. Hn. A.

      McMillan, Tom (Glasgow, C.)

      Rankin, John

      Woof, Robert

      MacPherson, Malcolm

      Rees, Merlyn

      Yates, Victor

      Mahon, Peter (Preston, S.)

      Roberts, Albert (Normanton)

      Mahon, Simon (Bootle)

      Robertson, John (Paisley)

      TELLERS FOR THE NOES:

      Mallalieu, E. L. (Brigg)

      Rogers, George (Kensington, N.)

      Mr. Joseph Harper and

      Manuel, Archie

      Rose, Paul

      Mr. Harry Gourlay.

      Mapp, Charles

      Dr. Bray: I beg to move Amendment No. 17, in page 2, line 8 leave out 'conduce to the benefit of' and insert 'benefit'.
      This Amendment is a grammatical tidying up. It has some substance to it, in that some hon. Members opposite in Committee felt the Government were tempering the rigour of the test on economic benefit. The meaning is made perfectly clear by removing the words conduce to the benefit of" and inserting "benefit".
      Mr. Peyton: As I had a similar Amendment down, perhaps I might be allowed, briefly and rather exceptionally, to welcome the speech just made by the Parliamentary Secretary. This was a most unpleasant sentence to find even in such a Bill as this. What proliferation, verbosity, this is. If I may give vent to a suspicion which dawned on me two or three years ago, the worse the Government is, the more the pressure of legislation, and therefore the worse—
      Mr. Michael Foot: The hon. Member should not give vent to
      472
      suspicions at the same moment as he is protesting about verbosity.
      Mr. Peyton: I learned it from the hon. Member. I was expressing a suspicion which has been in my mind for some time that the worse the Government is, the greater the pressure of legislation, and the more do those unfortunate and hard-pressed creatures the Parliamentary draftsmen allow such horrors to slip through the net. I welcome this sign of good intentions and I am very glad the Parliamentary Secretary has moved in this direction.
      Amendment agreed to.
      Mr. Peyton: I beg to move Amendment No. 22, in page 2, line 27, leave out from 'Scheme' to end of line 28.
      The Amendment is to delete the words "upon such terms as may be so determined". What do they mean? Why are they there? Will the Parliamentary Secretary please undertake to get rid of them? Nothing would be easier for him than to signify now that he will accept this Amendment. If he will give the slightest indication of his willingness

      473
      to do so, I will sit down immediately and be glad to abandon the argument.
      Mr. Dell: The hon. Gentleman has asked for a slight indication of our willingness to accept this Amendment. We accept this Amendment.
      Mr. Peyton: I only gave way for a moment. I must be allowed to express my gratitude that the Government have seen fit to delete these totally unnecessary words from a Bill which is just as unnecessary in my estimation. I am thankful for small mercies.
      Amendment agreed to.
      8.30 p.m.
      Dr. Bray: I beg to move Amendment No. 25, in page 2, line 33, leave out 'on the disposal' and insert 'in connection with the production'.
      There is an incompatibility between this subsection and the similar provision in the Concorde Clause. In effect, the Amendment brings the two into line.
      The loss on the disposal may not cover the whole case; for example, it might not cover a loss arising from capital investment which had been undertaken for the production of a particular product. It might merely cover a loss on the product itself. I hope that the House will find the Amendment acceptable.
      Amendment agreed to.
      Dr. Bray: I beg to move Amendment No. 27, in page 2, line 36, leave out 'make' and insert 'use or make arrangements for the'.
      This Amendment is aimed simply at widening the provisions very slightly so that instead of simply purchasing goods from such persons or bodies or making use of services provided for them, it is also to use or make arrangements for the use of services provided for them. It is not necessarily simply a matter of making use of them, but arranging for other people to do so. I think that it is self-explanatory.
      Mr. David Price: I wonder if the Joint Parliamentary Secretary can give us a little more explanation. In Standing Committee, we moved an Amendment to try and limit the effects of paragraph (d), which the House will recall is one of the methods
      474
      of support detailed under Clause 2(2). We tried to limit paragraph (d) to goods that would be required in the public service. We failed.
      It seems to me that the change in wording which the hon. Gentleman proposes widens it even further. As I read it, it is not only a matter of making use of the services, but making arrangements for it, which suggests that concerns outside the public sector or ones in the public sector which are not under the direct control of the Central Government will be asked to make use of the services or buy the goods. This could lead to unfair discrimination against other people who are in the same sphere of activity. If the Government decided, for example, to support the new I.C.L. computer company by saying that every university was to use a machine made by it and not one made by any of its competitors, obviously it would be unfortunate. As I read it, that could be the effect of accepting the proposed words. I may have read too much into them. If I have, I hope that the hon. Gentleman will disabuse me.
      Dr. Bray: Were a scheme like the preproduction order scheme for machine tools to be undertaken under the powers of the Bill instead of under the powers of the Science and Technology Act which covers it, it would be a matter of arranging for novel types of machine tool to be used by certain famous engineering companies in order to test them under working conditions. The purpose of the Amendment is to make it clear that that kind of arrangement is possible.
      I do not think that the hon. Gentleman questions the advantage of schemes like the preproduction order scheme, but he is rather concerned about possible abuses which may arise under it. Again, that would be a matter where the Government would be closely concerned to avoid any such difficulties. I think that there have been no complaints sustained against the preproduction order scheme. There will be the general arrangements against discrimination for which the Advisory Committee will watch out, and, therefore, the hon. Gentleman need not fear that in this subsection there will be any cause for complaint on the ground of discrimination.
      Amendment agreed to.
      Mr. Dell: I beg to move Amendment No. 28, in page 2, line 37, leave out from 'or' to 'purchase' in line 38.
      I think it would be to the convenience of the House if we took with this Amendment Amendment No. 30, in page 3, line 3, at end add:
      'and no such scheme shall authorise the subscription for or purchase of shares in any company (other than a company to be formed pursuant to the scheme) without the consent of the company.
      (4) In this section "shares" include stock'.
      Mr. Deputy Speaker: If the House so desires.
      Mr. Dell: It will be remembered that in Committee the hon. Member for Kidderminster (Sir T. Brinton) was particularly concerned that in Clause 2(2)(e) there is the phrase in brackets:
      "(with the consent of the company concerned)"
      following the words:
      "to subscribe for or"
      At that time I emphasised that it was the intention of the Government that no scheme should take place without the consent of the company with whom the Government were co-operating and no other situation was possible because the Bill conveyed no compulsory powers.
      Nevertheless, the hon. Member persisted in his point. He was concerned to ensure that in no conceivable circumstances could a company be forced to issue shares to the Government without its consent. Therefore, I agreed to have this matter further considered to make it clear if necessary beyond any possible doubt. That is the reason for this Amendment.
      We are asking the House to leave out the words now in brackets and, instead of dealing with the matter in paragraph (e) to deal with it by the words in Amendment No. 30, which states that:
      "no such scheme shall authorise the subscription for or purchase of shares in any company…"
      Then there are the words in the brackets and then:
      "without the consent of the company."
      It is clearly stated that the consent of the company applies in the case of a subscription for shares as well as for the purchase of shares in the market. The reason for the words in the brackets:
      476
      "(other than a company to be formed pursuant to the scheme)"
      is that a joint company might be formed between the Government and a private company, a subsidiary, and this might be an instrument for pursuing a scheme. It would be absurd that the consent of a company yet to be formed should be necessary in that case. It would be like asking a child to give consent to its own birth.
      We have also taken the opportunity to make clear that the word "shares" includes stock. This normally would be understood in any case, but to put the matter beyond doubt, as in the Shipbuilding Act, 1967, we have stated that in this Clause the word "shares" includes stock.
      Mr. John Nott: I fully understand why in Committee my hon. Friend the Member for Kidderminster (Sir T. Brinton) made this point, but I do not think the Government's Amendment is at all clear. It is not clear as to what is meant by the word "company" in this case. Is it referring to shareholders of the company or to the directors of the company? Surely the phrase should read, "with the consent of the shareholders of the company". Since the Parliamentary Secretary said clearly that no compulsory powers are contained in the Bill, the point surely is covered in paragraph (e) which refers to "purchase by agreement". I do not see why, if there are no compulsory powers, a purchase can be other than by agreement since if it is to be a purchase there must also be a seller. In his very admirable efforts to help my hon. Friend the Joint Parliamentary Secretary has allowed certain rather peculiar anomalies in the wording of the Government Amendment.
      Mr. David Price: My hon. Friend the Member for Kidderminster (Sir T. Brinton), who raised many issues of this nature in Committee, is, I am sure, grateful for the Under-Secretary's effort at meeting his fears. I am sure that the Under-Secretary will be able to comment on the points made by my hon. Friend the Member for St. Ives (Mr. Nott) on the wording.
      Mr. Peyton: Before the Under-Secretary does that, I want to reinforce what my hon. Friend the Member for St. Ives (Mr. Nott) said. I am sure that

      477
      the Government have acted from the best possible motives to try to meet a view expressed by the Opposition in Committee. However, I find this not only a singularly inelegant sentence, but also one that could be very misleading. One point which my hon. Friend the Member for Kidderminster (Sir T. Brinton) had in mind was that which my hon. Friend the Member for St. Ives has just made, namely, the meaning of "company". Does it mean shareholders, the board, or whom?
      Mr. Dell: I entirely agree with the hon. Member for St. Ives (Mr. Nott) that the previous wording covered the point, but the hon. Member for Kidderminster (Sir T. Brinton) had continuing doubts. We therefore tried to make it even clearer than it was in the original wording. I agree with the hon. Gentleman that purchase by agreement cannot mean anything but purchase by agreement, but in that case it would be purchase of shares by agreement of the existing shareholders, not necessarily with the consent of the company. That is why the words
      "the consent of the company"
      were inserted in relation to purchase of shares by agreement. We thought that it was clear, but doubts were expressed by hon. Members opposite and we thought it right to try to meet those doubts.
      By "company" we mean the company in the legal sense of the term. In Committee we discussed whether the consent of the shareholders should be required or whether it would be sufficient for the directors of the company to express their consent in the ordinary way. We then argued that in all matters where it was required by law, or in all matters where it was required by the company's articles of association, or in all matters where the directors thought it right to consult their shareholders, the shareholders would be consulted, but that otherwise there should be the normal process of consent by the company, which means consent by the board of directors of the company.
      Amendment agreed to.
      Further Amendment made: No. 30, in page 3, line 3, at end add:
      'and no such scheme shall authorise the subscription for or purchase of shares in any company (other than a company to be
      478
      formed pursuant to the scheme) without the consent of the company.
      (4) In this section "shares" include stock'.—[Mr. Dell.]

    Clause 5.

      ADVISORY AND ADMINISTRATIVE SERVICES.
      Mr. Peyton: I beg to move Amendment No. 39, in page 4, line 17, leave out subsection (2).
      Mr. Deputy Speaker: Amendment No. 42, in page 5, line 10, leave out paragraph (a), is consequential upon Amendment No. 39 and can be discussed with it.
      Mr. Peyton: I agree that that will be a convenient course.
      My motives here are purely exploratory. Ministers must accept that the Bill confers wide powers upon them. At the moment the Government's pay roll is considerably extended. Some of us take the view that the economy has been largely put in jeopardy by the Government's unwillingness to observe any discipline at all when it comes to their own expenditure. We do not take a very good view of seeing this glib little provision in a Bill like this. The subsection reads:
      "The Minister may pay to or in respect of the members of an Advisory Committee appointed under this section such remuneration or allowances as he may with the consent of the Treasury determine."
      There is the end of Parliamentary control. It is just a blanket authority to the Minister and to the Treasury to pay what they think proper.
      I should like to know a good deal more about it. I accept that there must be some form of allowances for any committee so that members may meet their expenses. On the other hand, one presumes that a good number of the people invited to serve on the Advisory Committee would be so affected by Surtax that any increased remuneration would hardly be worth the having.
      I am far from happy about an authority of this kind being given to Ministers. What do the Government regard as a proper limit to pay to members of the Advisory Committee? Ministers will not accept this for a moment, but we on this side take strong objection to the increase in the Government's payroll,

      479
      their constantly increasing patronage, and their power of appointment. This is the State waxing great. If we do not wish to check it at every point, at least we wish to examine it at every point with great care.
      8.45 p.m.
      Mr. Nott: I think that we are all in favour of the Advisory Committe, but what will be the procedure when the Minister comes to appoint the members? Nowadays, one finds, almost invariably, the same names cropping up again and again in the membership of various committees. There are certain pluralists in the business world who adorn too many boards and who are, therefore, quite incapable of properly carrying out any of their non-executive functions. There are also a good many of these so-called pluralists on Government advisory committees of one kind or another. They cannot be there for the allowances which Ministers grant. Presumably, they are there because they are patriotic-minded gentlemen keen to give a hand on the various committees which are at work.
      Is there a system within the Government and the Civil Service for spreading the net more widely? I am not looking for a job on any advisory committee, but I want to know whether there is a method whereby the net could be spread more widely so that younger people—
      Mr. Deputy Speaker: Order. The Amendment relates only to the payment of members of the Advisory Committee. It does not relate to the constitution or membership of such a Committee.
      Mr. Nott: Certainly, Mr. Deputy Speaker. When the Minister comes to pay allowances to these gentlemen, will he bear in mind that it would greatly strengthen the Advisory Committee if the net could be spread more widely, bringing in younger people and more people in business and commercial activities which so far have not provided members in receipt of allowances of this nature? As I say, one sees the same names cropping up again and again. There is a good deal of unexploited potential, if only the Treasury or the Minister could both lengthen and broaden the list.
      Dr. Bray: The hon. Member for St. Ives (Mr. Nott) is on a very good point.
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      I thought for a moment that he was constituting a new form of Chiltern Hundreds for which to apply, because he would not be able to sit in the House if he were to have an office of profit under the Crown.
      The question of how people are chosen for the many public rôles that must be filled nowadays is important, and I should be misleading the House if I suggested that anyone regards the present machinery and methods as wholly satisfactory. The hon. Gentleman is absolutely right to say that it would be splendid if we could have a way of identifying the up-and-coming young men before they become too heavily laden and could give them experience in particular public rôles. That is possibly a matter that will come up as a subsidiary question following the work of the Fulton Committee. Meanwhile, I assure the hon. Gentleman that one very effective channel of communication is through hon. Members, many of whom are in touch with a very wide range of activities and from whom Ministers are always glad to hear about people of ability who may offer a particular service to the nation.
      The danger to which the hon. Member for Yeovil (Mr. Peyton) referred concerning the power of patronage of the State is very real. He preceded me in a job—that of Parliamentary Secretary to the Ministry of Power—in which we dispensed more patronage than anybody other than the Prime Minister in terms of part-time appointments to the nationalised boards. I must confess that I was not unhappy to lay down that responsibility.
      However, I think that in this case there is little danger that the Advisory Committee would constitute a sort of extension of the power of patronage of the Crown. The cost here will not be great. The Financial Memorandum published with the Bill referred to a sum of about £15,000, but I would add to that the proviso that that depends on whether or not the members of the Committee accept a fee or simply accept payment of their expenses arising directly from their work on the Committee. It is right that the Minister should pay the members of the Committee. We shall not invariably have people who are very high in the Surtax bracket and are, therefore, unaffected by the time they spend on the Committee's work. But the expenses will certainly not be great. The intention is to have a small and expert

      481
      Committee, and not to occupy the full time, or anything like it, of its members.
      I hope that in view of those explanations the hon. Gentleman will not press the Amendment, or that if he does the House will reject it.
      Mr. Higgins: Will the hon. Gentleman clarify one point? He said "the Committee". Am I wrong in thinking that there may be a number of such Committees?
      Mr. Benn: Only one Advisory Committee.
      Mr. Higgins: I had thought that we could have an Advisory Committee concerned with different boards. I am glad to have the right hon. Gentleman's clarification on that point. Therefore, I am now right in saying that there is only one Advisory Committee, and the sum total of the £15,000 would be concerned with the payments and allowances of that Committee.
      Mr. Peyton: Whilst I accept with some reluctance what the Parliamentary Secretary says, and should not seek to divide the House on the issue, I ask him and the Government to digest this fact. He said that there were only a very few people involved, that it was quite a small organisation costing £15,000 a year. That is not the point. All the time there are constant accretions to the vast machinery of government, and I do not find all my anxieties set at rest. But, to show what a peaceful character I am, I shall not seek to divide the House, and I beg to ask leave to withdraw the Amendment.
      Amendment, by leave, withdrawn.
      Mr. Peyton: I beg to move Amendment No. 40, in page 4, line 22, to leave out 'not more than eight'.
      I move this Amendment simply for the purpose of inquiry. Unless the Government are very unhelpful, I would not wish to divide the House upon it. We want to know what strength the Government have in mind as being the optimum for the Advisory Committee. I would not want the Government to have too wide a discretion. I can see—although this is a rather foreign point of view for me—some danger in having too small a committee of experts, all of whom might come from the N.R.D.C. or the I.R.C.,
      482
      both of which are really Government creatures.
      It is important that such an Advisory Committee as this should consist at least 50 per cent. of genuinely outside elements—people far removed from the Government machine or any of its creatures. My purpose is to find out the Government's intention. When the Government ask for this sort of power, they must be prepared to spell out their intention.
      Mr. Higgins: I am sure that my hon. Friend the Member for Yeovil (Mr. Peyton) was right to put down this probing Amendment and ask the Government to make clear their intention with regard to the composition of the Advisory Committee. We have consistently stressed that we regard the Committee's rôle as important and, indeed, hoped that it would get greater powers than proposed in the Bill. But we are really not clear why the Minister feels it necessary to have an upper limit to the number of members of the Committee. It seems unnecessary to impose this sort of limit. If he did not wish to appoint more than a certain number, surely he would be free not to appoint them.
      The point put by my hon. Friend—it was not raised, significantly, in Standing Committee—is the composition of the Advisory Committee within the limits the Government seek to set. Is it the case that it could consist entirely of members appointed from the N.R.D.C. and the I.R.C.? If that is so, it seems a little undesirable. They would, as my hon. Friend has said, effectively be creatures of the Government. The purpose of an advisory committee is to give an impartial advisory opinion, which is rather difficult for those who hold posts in other Government organisations. While it is probably unnecessary to amend the Bill to specify that the numbers shall be open-ended and to specify the composition, I hope the Government will indicate why they think an upper limit is necessary in the first place and, secondly, their intention with regard to the composition of the Committee. A balanced committee with perhaps only a minority of membership from the N.R.D.C. and the I.R.C. might be a better arrangement.
      Dr. Bray: The intention of having an upper limit is to make it abundantly clear that this shall be a small and expert

      483
      committee and not a large general consultative committee, in which one would have trouble in representing many different kinds of interest and many different types of occupation. The terms of the Bill as now drafted result from an Amendment made in Committee to meet the spirit of points put by hon. Members opposite and certainly to deal with the question of having outsiders on the Committee. It was and remains the intention to have outsiders on it. I would not like it to be thought that any doubt was being cast on the independence and judgment of people from the N.R.D.C. and the I.R.C. It is often extremely useful to have people with experience of one part of the public sector advising on another part. A notable example is that the Chairman of the Electricity Council is now the Chairman of the Edwards Committee.
      Having members from the I.R.C. and the N.R.D.C. is highly desirable, for it enables those bodies to co-operate with the Government in the effective implementation of the Bill. Their work as members of the Advisory Committee and their membership of the boards of I.R.C. and N.R.D.C. respectively and their knowing about the work done by those Corporations on any specific investigations which they are asked to undertake under the Bill will clearly be of advantage to the Government, which will have an Advisory Committee bringing closely together these three possible directions of effort, each having rather different functions.
      I hope that hon. Members will feel that the move which the Government made in Committee effectively meets their point and that, as the Bill now stands, we shall be able to meet their objectives.
      Amendment negatived.
      9.0 p.m.
      Mr. Peyton: I beg to move Amendment 41, in page 4, line 40, leave out paragraph (c).
      I want to know what is the justification for giving these Corporations either the power or the duty to undertake, at the request of or on behalf of a competent authority, any negotiations with a view to making an industrial investment scheme, or any administrative functions of that authority under such a scheme. What equips these creatures—the Nat
      484
      ional Research Development Corporation, for instance—to undertake negotiations of that kind? Why should they do so? What are their qualifications? I find it hard to accept the necessity for a provision of this kind.
      The whole of the Bill seems to be the result of someone having scratched his head hard and asking himself, "Is there anything else which we can include as we perpetrate this nasty piece of legislation? We know that we are faced by an exceedingly innocent and unsuspicious Opposition, but even a Tory Opposition will not accept this sort of thing to Kingdom come and their suspicions must eventually be stirred and they will start asking questions". And so everyone available in Whitehall and all these so-called competent authorities have been paraded and instructed to think of any sort of provision which seems to have been left out and which might possibly or usefully or conceivably be put in.
      What are the reasons for this? I know, Mr. Speaker, that you would look upon me with some disapproval if I sought to return to Clause 2 at length and I shall not do so, but I remind the House that Clause 2 is a good example of the inclusion of a ragbag of powers very generally and going down to the particular
      "without prejudice to the generality of the foregoing"
      which is an expression which always awakens my interest.
      It could be that the Government will be able to satisfy me about this, but I rather doubt it. If I were engaged in an operation of this kind I cannot think of anything more unlikely than that I should invite the National Research Development Corporation, much as I respect it, to engage on my behalf in the making of an industrial investment scheme. The mere name of a research and development body—what an inconceivable thing to put upon it the duty of negotiating a scheme of that kind, which I imagine is envisaged under this Bill. Not only does it undertake negotiations, but the administrative functions of the authority under such a scheme. Again, with great respect to the N.R.D.C.—and I am not being sarcastic—is it really competent to undertake any of the administrative functions under the scheme?

      485
      What about the Industrial Reorganisation Corporation? I remember the Minister at the time announcing the names of the members of the Corporation. He did it with tremendous pride. It sounded like a list of battle honours—all these great men whom the Government had captured or wooed from private industry in order to help them with their fell schemes.
      I have always had a great deal of sympathy, particularly recently, for Sir Frank Kearton, the Chairman of the Industrial Reorganisation Corporation, because he must be suffering from schizophrenia. Wearing his own hat as Chairman of Courtaulds, he is castigated and chastised by the Government as a possible monopolist, having gathered through his company too much of the rayon market. On the other hand, when he is in charge of the I.R.C. he is urged, and is under pressure, to create monopolies. One would expect any man's health to suffer from such a conflict, even when he has the knowledge that it has been put upon him by an asinine Government.
      I find this objectionable, and I hope that my hon. Friend the Member for Worthing (Mr. Higgins), for whom I have great respect, will be the first to support me in voting for the Amendment. Unless the Parliamentary Secretary can produce an answer, the cleverness, veracity and magnificence of which is something which even my optimism does not lead me to expect I shall receive, I will surely vote for this Amendment because I find this provision objectionable and obnoxious.
      Mr. Small: I want to ask the Government to resist this Amendment. I entered the debate because the hon. Member for Yeovil (Mr. Peyton), in his interesting appreciation of men who render public service, referred to them as "creatures". Would he like me to allege that he is a creature of the Tory Party? The opportunity of having a very good education—
      Mr. Peyton: The hon. Gentleman has misunderstood me. I would not use such a derogatory term unless I fully intended to be derogatory of the person I was talking about. When I used the word "creatures" I referred to organisations and not to the people concerned, for whom I, like the hon. Member, have the
      486
      greatest possible respect. If I am in any way guilty of having confused the House, I am grateful to the hon. Gentleman for having enabled me to put it right. I certainly meant no disrespect whatever to those who serve on both these Corporations, many of whom I know, and for almost all of whom I have the highest respect.
      Mr. Small: I accept the modified use of the word "creature".
      I should think that the people who serve these institutions are as competent as anybody. I have found no criticism in the market place of the mergers of know-how, knowledge and experience which have taken place among these people in assisting Governments in coming to a conclusion. I have in mind particularly the services of Sir Ronald Grierson. I am sure that men of quality of this kind serve the Government well. I hope that we shall not continuously have these derogatory remarks made about people and institutions who serve the best interests of the Government.
      Mergers such as that between Leyland and the British Motor Corporation ensure that we have a British-based motor industry capable of competing with motor industries in the rest of the world—Volkswagen, Renault and others. Whenever it is humanly possible, we should ensure, by Government assistance, that such industries remain British-based in concept. The same is true of the aircraft and shipbuilding industries. We should not have to buy off the shelf some other country's products and be held to ransom in the market place. I have the greatest admiration of the job done by the N.R.D.C. and the I.R.C., which is based on a national rather than commercial concept.
      Dr. Bray: I remind hon. Members that it is the "National Research Development Corporation" and not the "National Research and Development Corporation". It is concerned not merely with research in the abstract but with its application for hard commercial reasons and, therefore, has a great deal of experience of commercial judgments which need to be made in industry.
      The N.R.D.C. has a great deal to offer concerning matters involving technological production or marketing, perhaps, in advanced technology. Likewise, the I.R.C.

      487
      has a great deal of ability and is accumulating a body of experience concerning matters of company structure, rationalisation, mergers, and so on, which will be very valuable to the Advisory Committee.
      Hon. Members opposite constantly press us to seek advice from people in industry and to act on it. They urge us to bring in people with wide experience and to emulate some hon. Members opposite who are on 30 or 40 boards of directors at the same time. They are less than fair to themselves and their own persuasive powers if they do not expect us to take the point and to secure the right degree of co-ordination and cross-membership of important official bodies. I accept the point of hon. Members opposite about bringing in outside people, but to leave out the N.R.D.C. or I.R.C. from the sort of rôle set out in the Bill would be a great mistake.
      9.15 p.m.
      Mr. Higgins: The hon. Gentleman seems to have misunderstood either the Amendment, or the purpose of the Clause. The purpose of the Amendment is to delete paragraph (c). This will ensure that the Corporations do not have the power to undertake this kind of negotiation, not that the Advisory Committee will not have it. The hon. Gentleman's remarks seemed to be adressed to the proposition that the Advisory Committee should not have this power.
      Dr. Bray: The Advisory Committee will not have a professional staff in the way that the N.R.D.C. and the I.R.C. will have. Where these two Corporations have been asked to advise on a question, they may be in a strong position to conduct subsequent negotiations in either of their respective spheres. I take the point made by the hon. Gentleman. It is not as members of the Advisory Committee. It is to undertake at the request, and on behalf, of a competent authority any negotiations which arise from the Bill as a result of the membership of these Corporations and the particular abilities of the staff of these Corporations, and indeed possibly arising from the work that they have done in the area involved.
      Micro-electronics is an area which raises questions both of company relationship and of advanced technology, but it is nevertheless primarily a production
      488
      problem, and it is conceivable that, for example, the N.R.D.C. may be a useful body to exercise the wider functions which are made available to Ministers under the Bill, going beyond the powers which the N.R.D.C. has under its own responsibility. I think that this takes the point made by the hon. Member for Worthing. It is a different function from merely advising by the Advisory Committee, but it is nevertheless a valuable function.
      Mr. Higgins: I must pursue the hon. Gentleman's answer, because I do not think that it is satisfactory. The Government are taking power under subsection (5)(c) so that the Corporations, that is to say, the I.R.C. and the N.R.D.C., shall have power to negotiate. It is not a question of the Advisory Committee doing so. It is a question of the Corporations having this power.
      That is what the Government are suggesting should be done. If that is so, it surely is open to some of the objections raised by my hon. Friend the Member for Yeovil (Mr. Peyton). In Committee we debated at some length the question of which body would be most likely to have the expertise necessary to evaluate any Government proposal or any proposal for investing Government money in an enterprise. We discussed the technical ability of various bodies, the extent to which it would be desirable for the thing to be centralised in some way, and so on. It is undesirable that the Government should suggest that the Corporations should have delegated to them the powers which would normally be exercised by the responsible authority.
      This is an important task. It is not a question of giving advice but of taking decisions, because if this power is delegated to one of the Corporations, the decision which that Corporation takes in the course of negotiations must be binding. It may be that the Corporation will always come back to the responsible authority and ask, "Should I do this? Should I do that?". If that is so, there is no point in having a middle man in the exercise. He may have some advice to give, but there is no point in having him conducting negotiations.
      On the other hand, if the opposite case applies, if the Corporation concerned is to have power to take irrevocable decisions, or decisions which are binding on

      489
      the responsible authority and the Government, if not on the House of Commons, this again will be an unfortunate situation, because, as my hon. Friend the Member for Yeovil said, it is not only a question of the technical competence of the Corporations, but the membership of them.
      Some of the representatives serving on them have other interests. While one can say that these people will try as hard as they can to divest themselves of these interests when serving on the Corporation, it is not given, except in acute case of schizophrenia—I use the word in the technical sense—for people to acquire information in one occupation which is not at the back of their minds in other occupations. There will, therefore, be instances when members of a corporation are able to negotiate in one case but when it would be totally wrong for them to negotiate in another.
      Sir Donald Stokes was mentioned. It might be undesirable that he should negotiate a scheme which is seeking to put Government money into, say, the textile industry, but there will be other instances when it would be highly desirable that he should be a negotiator. For this reason it is reasonable to ask why the Government Department concerned, the responsible authority, should not itself always take the negotiations on its shoulders. It could do so with advice and, bearing in mind that technical assistance it can receive from, for example I.R.C. and the N.R.D.C., there seems no reason why these negotiations should not be undertaken by a Government Department rather than by one of these corporations.
      Most of the considerations are, to a greater or lesser extent, of a political type. If the industrial investment scheme in question is to be negotiated not by the responsible authority but under power delegated to one of the corporations, then the corporation in question will need to take into account in the course of the negotiations—because this is relevant to the terms it considers—the considerations set out in Clause 2(1), which are whether it will create or expand productive capacity, promote technological improvements and whether it is to the benefit of the United King
      490
      dom as a whole. These considerations are all relevant to the negotiations.
      However, one cannot accept that the I.R.C. or the N.R.D.C. are competent in such negotiations to determine whether something is in the interests of the United Kingdom economy. Certainly I would not feel that they are competent to decide such matters. That being so, we are back to where we started—that either they will take decisions which they are not competent to take or they will be excluded from participating in negotiations. The alternative is that they will be constantly referring matters back to the responsible authority.
      In the absence of a better explanation from the Minister, it is obvious that my hon. Friends are on to a good point. The powers of delegation which the Government are seeking in Clause 5(5,c) obviously need much more consideration, and I hope that, on reflection, the Minister will feel that they are not necessary for the purposes of the Bill and that they should be abandoned at this stage.
      Dr. Bray: I appreciate that there is little chance of my persuading hon. Gentleman opposite, but I wish to make it perfectly clear on the three questions that have been asked exactly what is the view of the Government, if that view has not already been made completely clear.
      The first question was about the competence of these bodies. We would not regard them as the right bodies to deal with questions of major national policy where wider judgments were required. On the other hand, we would regard them as competent to do particular negotiations in certain spheres.
      To answer the second question, about a possible conflict of interest, this problem arises time and again in the daily work of the City of London, to mention only one part of the country, but already the problem has well understood methods of being dealt with in the existing operations of the I.R.C., and these have involved, for example, the British Motor Corporation and the Leyland Motor Company, of which Sir Donald Stokes was the chairman. In these cases such members of the corporation concerned do not take any part in the negotiations, and this is clearly understood. On the other hand, the very background

      491
      of experience which makes him an interested party also makes him a valuable member of the corporation when it is dealing with other matters.
      In the third question, of constant reference back, this is a question of getting proper relationships and proper terms of reference on any matters which these corporations may be asked to carry out, and this would be clearly laid down in advance.
      Mr. Peyton: I realise the Parliamentary Secretary is doing his best, but I still feel uneasy. I have no disrespect whatever for the individuals concerned in either of these bodies. I hope that the hon. Member for Glasgow, Scotstoun (Mr. Small) will accept without qualification that I used the word "creature" in
      a slightly pejorative sense, but I did not mean it to apply to individuals. I am applying it to the constant multiplication of Government organisations, which I do not like. It will muddle the functions of everybody. I doubt whether it will produce the clarity which the Government want in wishing upon these two bodies not only the duty of conducting negotiations, but that of taking over administrative functions as well without further definition. That is what bothers me most. I hope my hon. Friends will agree with me and go into the Lobby against it.
      Question put, That the Amendment be made:—
      The House divided: Ayes 140 Noes 209.

      Division No. 107.]

      AYES

      [9.28 p.m.

      Alison, Michael (Barkston Ash)

      Goodhart, Philip

      Nicholls, Sir Harmar

      Astor, John

      Goodhew, Victor

      Noble, Rt. Hn. Michael

      Awdry, Daniel

      Gower, Raymond

      Nott, John

      Baker, K. W. (Acton)

      Grant, Anthony

      Onslow, Cranley

      Baker, W. H. K.

      Grant-Ferris, R.

      Orr, Capt. L. P. S.

      Beamish, Col. Sir Tufton

      Gresham Cooke, R.

      Osborn, John (Hallam)

      Bell, Ronald

      Hall-Davis, A. G. F.

      Percival, Ian

      Bennett, Sir Frederic (Torquay)

      Harrison, Brian (Maldon)

      Peyton, John

      Birch, Rt. Hn. Nigel

      Harrison, Cot. Sir Harwood (Eye)

      Pink, R. Bonner

      Black, Sir Cyril

      Harvey, Sir Arthur Vere

      Powell, Rt. Hn. J. Enoch

      Blaker, Peter

      Hastings, Stephen

      Price, David (Eastleigh)

      Boardman, Tom

      Hawkins, Paul

      Pym, Francis

      Boyd-Carpenter, Rt. Hn. John

      Heald, Rt. Hn. Sir Lionel

      Quennell, Miss J. M.

      Brewis, John

      Higgins, Terence L.

      Ramsden, Rt. Hn. James

      Brinton, Sir Tatton

      Hiley, Joseph

      Rhys Williams, Sir Brandon

      Bromley-Davenport, Lt. -Col. Sir Walter

      Hill, J. E. B.

      Rossi, Hugh (Hornsey)

      Brown, Sir Edward (Bath)

      Hogg, Rt. Hn. Quintin

      Royle, Anthony

      Bryan, Paul

      Holland, Philip

      Russell, Sir Ronald

      Buchanan-Smith, Alick (Angus, N & M)

      Hordern, Peter

      Scott, Nicholas

      Buck, Antony (Colchester)

      Hornby, Richard

      Scott-Hopkins, James

      Campbell, Gordon

      Howell, David (Guildford)

      Sharples, Richard

      Carr, Rt. Hn. Robert

      Hunt, John

      Sinclair, Sir George

      Channon, H. P. G.

      Hutchison, Michael Clark

      Stainton, Keith

      Chichester-Clark, R.

      Irvine, Bryant Godman (Rye)

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

      Corfield, F. V.

      Jenkin, Patrick (Woodford)

      Taylor, Frank (Moss Side)

      Costain, A. P.

      Jopling, Michael

      Temple, John M.

      Craddock, Sir Beresford (Spelthorne)

      Kershaw, Anthony

      Thatcher, Mrs. Margaret

      Crouch, David

      King, Evelyn (Dorset, S.)

      Turton, Rt. Hn. R. H.

      Crowder, F. P.

      Kirk, Peter

      van Straubenzee, W. R.

      Dalkeith, Earl of

      Knight, Mrs. Jill

      Vaughan-Morgan, Rt. Hn. Sir John

      Dance, James

      Lane, David

      Walker, Peter (Worcester)

      Dean, Paul (Somerset, N.)

      Langford-Holt, Sir John

      Ward, Dame Irene

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

      MacArthur, Ian

      Weatherill, Bernard

      Digby, Simon Wingfield

      Maclean, Sir Fitzroy

      Webster, David

      Doughty, Charles

      McMaster, Stanley

      Wells, John (Maidstone)

      Eden, Sir John

      Maddan, Martin

      Whitelaw, Rt. Hn. William

      Elliot, Capt. Walter (Carshalton)

      Maginnis, John E.

      Williams, W. D. (Dudley)

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

      Mawby, Ray

      Wills, Sir Gerald (Bridgwater)

      Emery, Peter

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

      Wilson, Geoffrey (Truro)

      Eyre, Reginald

      Mills, Peter (Torrington)

      Wolrige-Gordon, Patrick

      Farr, John

      Mills, Stratton (Belfast, N.)

      Worsley, Marcus

      Fisher, Nigel

      Mitchell, David (Basingstoke)

      Wright, Esmond

      Fletcher-Cooke, Charles

      Montgomery, Fergus

      Wylie, N. R.

      Fortescue, Tim

      More, Jasper

      Younger, Hn. George

      Foster, Sir John

      Munro-Lucas-Tooth, Sir Hugh

      Gibson-Watt, David

      Murton, Oscar

      TELLERS FOR THE AYES:

      Gilmour, Sir John (Fife, E.)

      Nabarro, Sir Gerald

      Mr. Hector Monro and

      Godber, Rt. Hn. J. B.

      Neave, Airey

      Mr. Timothy Kitson.

      NOES

      Abse, Leo

      Hamilton, James (Bothwell)

      Morris, Alfred (Wythenshawe)

      Allaun, Frank (Salford, E.)

      Hamling, William

      Morris, Charles R. (Openshaw)

      Alldritt, Walter

      Harper, Joseph

      Morris, John (Aberavon)

      Allen, Scholefield

      Harrison, Walter (Wakefield)

      Moyle, Roland

      Anderson, Donald

      Haseldine, Norman

      Newens, Stan

      Archer, Peter

      Hattersley, Roy

      Noel-Baker, Francis (Swindon)

      Atkins, Ronald (Preston, N.)

      Hazell, Bert

      Ogden, Eric

      Atkinson, Norman (Tottenham)

      Heffer, Eric S.

      O'Malley, Brian

      Bagier, Gordon A. T.

      Henig, Stanley

      Orme, Stanley

      Barnett, Joel

      Herbison, Rt. Hn. Margaret

      Oswald, Thomas

      Baxter, William

      Hooley, Frank

      Owen, Will (Morpeth)

      Bence, Cyril

      Hooson, Emlyn

      Page, Derek (King's Lynn)

      Benn, Rt. Hn. Anthony Wedgwood

      Horner, John

      Palmer, Arthur

      Bennett, James (G'gow, Bridgeton)

      Houghton, Rt. Hn. Douglas

      Pannell, Rt. Hn. Charles

      Binns, John

      Howarth, Harry (Wellingborough)

      Park, Trevor

      Bishop, E. S.

      Howarth, Robert (Bolton, E.)

      Parkyn, Brian (Bedford)

      Blenkinsop, Arthur

      Hoy, James

      Pavitt, Laurence

      Booth, Albert

      Huckfield, Leslie

      Pearson, Arthur (Pontypridd)

      Boyden, James

      Hughes, Hector (Aberdeen, N.)

      Pentland, Norman

      Bray, Dr. Jeremy

      Hughes, Roy (Newport)

      Perry, George H. (Nottingham, s.)

      Brooks, Edwin

      Hunter, Adam

      Price, Thomas (Westhoughton)

      Broughton, Dr. A. D. D.

      Hynd, John

      Price, William (Rugby)

      Buchan, Norman

      Irvine, Sir Arthur

      Probert, Arthur

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

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

      Rankin, John

      Carmichael, Neil

      Jackson, Peter M. (High Peak)

      Rees, Merlyn

      Carter-Jones, Lewis

      Jenkins, Hugh (Putney)

      Roberts, Albert (Normanton)

      Chapman, Donald

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

      Robertson, John (Paisley)

      Coleman, Donald

      Johnston, Russell (Inverness)

      Rose, Paul

      Concannon, J. D.

      Jones, Dan (Burnley)

      Ross, Rt. Hn. William

      Conlan, Bernard

      Jones, J. Idwal (Wrexham)

      Ryan, John

      Crawshaw, Richard

      Jones, T. Alec (Rhondda, West)

      Sheldon, Robert

      Crossman, Rt. Hn. Richard

      Kelley, Richard

      Shore, Rt. Hn. Peter (Stepney)

      Cullen, Mrs. Alice

      Kerr, Dr. David (W'worth, Central)

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

      Davidson, Arthur (Accrington)

      Lawson, George

      Silkin, Rt. Hn. John (Deptford)

      Davidson, James(Aberdeenshire, W.)

      Leadbitter, Ted

      Silverman, Julius (Aston)

      Davies, Dr. Ernest (Stretford)

      Ledger, Ron

      Slater, Joseph

      Davies, G. Elfed (Rhondda, E.)

      Lee, Rt. Hn. Frederick (Newton)

      Small, William

      Delargy, Hugh

      Lee, John (Reading)

      Spriggs, Leslie

      Dell, Edmund

      Lewis, Ron (Carlisle)

      Steel, David (Roxburgh)

      Dempsey, James

      Loughlin, Charles

      Steele, Thomas (Dunbartonshire, W.)

      Dewar, Donald

      Lubbock, Eric

      Stewart, Rt. Hn. Michael

      Dickens, James

      Lyon, Alexander W. (York)

      Stonehouse, John

      Dobson, Ray

      Lyons, Edward (Bradford, E.)

      Swain, Thomas

      Doig, Peter

      Mabon, Dr. J. Dickson

      Swingler, Stephen

      Dunn, James A.

      McBride, Neil

      Symonds, J. B.

      Dunwoody, Mrs. Gwyneth (Exeter)

      McCann, John

      Tinn, James

      Eadie, Alex

      MacColl, James

      Tuck, Raphael

      Edwards, Rt. Hn. Ness (Caerphilly)

      Macdonald, A. H.

      Urwin, T. W.

      Edwards, Robert (Bilston)

      McGuire, Michael

      Wainwright, Edwin (Dearne Valley)

      Edwards, William (Merioneth)

      Mackenzie, Gregor (Rutherglen)

      Wainwright, Richard (Colne Valley)

      Ellis, John

      Maclennan, Robert

      Walker, Harold (Doncaster)

      Ennals, David

      McMillan, Tom (Glasgow, C.)

      Wallace, George

      Ensor, David

      MacPherson, Malcolm

      Watkins, David (Consett)

      Faulds, Andrew

      Mahon, Peter (Preston, S.)

      Watkins, Tudor (Brecon & Radnor)

      Fernyhough, E.

      Mahon, Simon (Bootle)

      Wellbeloved, James

      Fletcher, Raymond (Ilkeston)

      Mallalieu, E. L. (Brigg)

      Wells, William (Walsall, N.)

      Fletcher, Ted (Darlington)

      Manuel, Archie

      Whitaker, Ben

      Foley, Maurice

      Mapp, Charles

      Whitlock, William

      Foot, Michael (Ebbw Vale)

      Marks, Kenneth

      Wilkins, W. A.

      Ford, Ben

      Marquand, David

      Willey, Rt. Hn. Frederick

      Fowler, Gerry

      Marsh, Rt. Hn. Richard

      Williams, Clifford (Abertillery)

      Freeson, Reginald

      Mason, Rt. Hn. Roy

      Williams, W. T. (Warrington)

      Galpern, Sir Myer

      Maxwell, Robert

      Willis, Rt. Hn. George

      Gardner, Tony

      Mayhew, Christopher

      Winstanley, Dr. M. P.

      Garrett, W. E.

      Mendelson, J. J.

      Woodburn, Rt. Hn. A.

      Gourlay, Harry

      Millan, Bruce

      Woof, Robert

      Gregory, Arnold

      Miller, Dr. M. S.

      Yates, Victor

      Grey, Charles (Durham)

      Milne, Edward (Blyth)

      Griffiths, David (Rother Valley)

      Mitchell, R. C. (S 'th' pton, Test)

      TELLERS FOR THE NOES:

      Griffiths, Will (Exchange)

      Moonman, Eric

      Mr. Ioan L. Evans and

      Grimond, Rt. Hn. J.

      Morgan, Elystan (Cardiganshire)

      Mr. Eric G. Varley.

    Clause 8.

      FINANCE FOR CONCORDE PROJECT.
      Mr. Hugh Jenkins: I beg to move Amendment No. 43, in page 5, line 38, leave out Clause 8.
      Mr. Speaker: With Amendment No. 43 I have suggested that we may take the following Amendments: No. 44, in page 6, line 1, leave out subsection (2); No. 45, in line 2, leave out from 'loans' to second 'in' in line 4; No. 46, in line

      495
      5, leave out from 'aircraft' to end of line 6; No. 47, in line 21, leave out subsection (4).
      Mr. Jenkins: The object of this Amendment and those which you, Mr. Speaker, have decided can be taken with it, is to remove from the Bill the Clause which enables the Government to provide expenditure for the financing of the Concorde project. What I seek to do is to make it impossible for that project to go into production. If I am successful with this Amendment and this is removed from the Bill, I think I shall be doing the Government a great service and saving the taxpayers of the country a very substantial sums of money. Therefore, it is with very great enthusiasm that I put forward the proposal—[Interruption.]
      Mr. Speaker: Order. I want to hear the hon. Member.
      Mr. Jenkins: Thank you, Mr. Speaker. It is with great enthusiasm that I give the House the opportunity of saving the taxpayers this substantial sum of money, a project which I am sure will endear itself to hon. Members opposite. The Clause provides that:
      "There may be defrayed out of moneys provided by Parliament any expenditure incurred by the Minister of Technology under arrangements for providing financial support for the production in the United Kingdom of the supersonic aircraft known as the Concorde, being arrangements made with the approval of the Treasury."
      It will be noticed that there is no limitation on the moneys to be provided in that subsection.
      Subsection (2) says:
      "Any such arrangements may provide for financial support to be provided by the Minister by making loans, giving guarantees in respect of money borrowed, or underwriting in whole or in part any losses which may be incurred in connection with the production of the said aircraft, or by any other method which the Minister considers appropriate."
      It is a very wide provision. [Interruption.] If my hon. Friends wish to carry on a conversation, perhaps they would be kind enough to do so outside the Chamber and allow me to continue. This provision gives my right hon. Friend very substantial powers which I think that he should not have.
      The reasons why I oppose the development and production of the Concorde have been described by the hon. Member
      496
      for Woking (Mr. Onslow) as those of the lunatic fringe of the anti-noise group. To support my argument, therefore, I want to make two quotations, one from the Air Correspondent of the Observer and the other from the Business Section of the same newspaper. Mr. Wilson, the Air Correspondent, wrote this in November and the figures that he gave at that time have escalated since then because the costs of the Concorde increase week by week:
      "This question comes into focus only when one contemplates the £250 million earmarked as Britain's half share of the development costs of the Concorde, an economically unviable project whose slender social benefits—unlike its noise menace—can never reach more than a few.
      The Government's decision to carry on with the Concorde has always been reluctant. The decision to withdraw was nearly taken in 1964, after a study of the facts. It was dropped on the advice of the Law Officers (now widely regarded as having been ill-founded) that it would render Britain liable for compensation to France in the International Court."
      Mr. Wilson goes on to recommend that the Concorde should be stopped now and that we should
      "devote some of the millions which would otherwise be spent on it to rationalising air travel where the need is urgent—on the ground."
      This is my object in moving the Amendment.
      In further support of my proposal, I quote from the Business Section of the Observer of 3rd March:
      "If the final loss on the Concorde is anything less than £800 million it will be a miracle. This is because even if the maximum possible sales"—
      which the Observer puts at 100 aircraft; I would like my right hon. Friend to confirm or deny this figure—
      "were achieved, the production cost would be £8 million each, to which must be added a £7 million share of research and development costt,—and the selling price is £7 million."
      If these figures are right, even with sales of 100 aircraft we should be dropping £8 million per aircraft. Is the Observer wrong in these estimates?
      The makers of the aircraft still assume that Concorde will be allowed to fly over land at supersonic speeds. The Government still refuse to give any undertaking that Concorde will not be allowed to fly over land at supersonic speeds. What are the Government's intentions? Are we to be subjected to sonic booms?

      497
      9.45 p.m.
      There has been experience of this already in the United States. In a previous debate on the subject, the hon. Member for Woking raised the question whether ability to sue had been of much value there. We have some evidence about it. A Mr. Bailey Smith wrote a letter to The Times not long ago, saying that he had won a suit for damages for 10,000 dollars. He said:
      "I am the winner of that damage suit. The U.S. Government paid the claim in full without appealing to a higher court."
      It was a claim in respect of sonic boom damage caused by supersonic flying tests over Oklahoma City. He went on:
      "When asked why no appeal was made, the U.S. Attorney said, 'When we have lost, Mr. Smith, we do not wish to have that loss underscored or put in parenthesis. We want you forgotten'."
      Mr. Speaker: With all respect, we are debating the financing of the Concorde. What happens in the United States can hardly arise on this Amendment.
      Mr. Jenkins: I unreservedly accept your Ruling, Sir, but the point I am making is that the enterprise is likely to be very costly for the Government. It is likely to go beyond the actual production and development costs of the aircraft itself. The Government are likely to be involved, directly or indirectly—they are very deep in this project—in further expense as a result of actions brought against them for damage caused by sonic booms. My understanding of the law in this country is that, while the citizen has no redress and cannot sue for injury, discomfort or nuisance caused by noise, he may protect himself under the law against actual damage caused to his dwelling or his person by sonic boom. Therefore, apart from the exorbitant cost of the aircraft itself and the continuing cost of running it, the Government may well have to face the payment of compensation as a result of the flying of the aircraft.
      This is a leap in the dark. In this connection, I quote from the House of Commons Library Research Division "Science Digest, No. 21", in which there is a quotation from Nature about sonic booms and superbooms. I shall quote
      498
      only two sentences because I do not want to take too much time. First,
      "The overall impression given by the report"—
      a report of the U.S. National Academy of Sciences entitled "Generation and Propagation of Sonic Boom"—
      "is of the extent of the ignorance still surrounding the phenomenon."
      The article concludes:
      "An extended research programme seems to be called for before it is too late."
      If this aircraft goes into production, it will already be too late. We shall be taking off into an entirely unknown area. It is an extraordinary project upon which the Government are embarked. A vast amount of public money is being invested in a project which is quite untested. All the knowledge about supersonic flying could be written on the back of a stamp. [HON. MEMBERS: "No."] There is a small amount of military supersonic flying. There has been some in France. A little has been done in this country. There has been some in the United States. But the extent of knowledge about the effects of supersonic flying is very small indeed. There is no doubt about that. If hon. Members have any doubt, they ought to do a little study of the subject.
      I want my right hon. Friend to give us some assurances: first, that the Concorde will not go into production until the boom pattern of this particular aircraft has been thoroughly tested; second, that if it is satisfactory, and if the aircraft ultimately goes into service, it will not be permitted to fly over land in service. If my right hon. Friend can answer the questions I have put and give the assurances for which I have asked, it is possible that if the House felt so disposed I might not press the Amendment. But if he cannot give those assurances, I shall have to think again about precisely what action I shall take in the matter.
      Mr. Onslow: We have some cause to be grateful to the hon. Member for Putney (Mr. Hugh Jenkins) for tabling the Amendments, because they give us a little more opportunity to debate this very important subject than has hitherto been provided. So far, we have had the magnificent total of 45 minutes to devote to this question of the Bill. That was an

      499
      interesting debate in which I do not recall, that the hon. Gentleman participated. But, as is so often the result of the reforms of the Leader of the House, it was by no means as satisfactory as hon. Members taking part would have wished.
      The Minister made certain remarks about me then which showed that he had caught the general bad-tempered mood of that debate, and I suppose that we can also hold the Leader of the House to blame for that. The Minister accused me that evening of having been continually sniping at the project, of having attempted to undertake continual action designed to shake the confidence of the world's airlines in the likelihood of Concorde coming forward, and more in the same vein.
      I know that it is the Minister's birthday today, so I hope that he is in a better mood. On that basis, I suggest that if he is really looking for somebody who has been continually sniping at the Concorde project and seeking to undermine the confidence of the world's airlines in it he should look behind him. He will find that he has no need to look further than his hon. Friend the Member for Putney, whose admitted aim in moving the Amendment has been to kill the Concorde project. He admits it, and we must at least give him credit for that.
      But the hon. Gentleman has sought to do so on many previous occasions and in a numbers of ways which do not lend great credit to his logic or consistency. He has tried to imply that Concorde will not be able to get to the other side of the Atlantic, that passengers in it will be exposed to dangerous levels of radiation, and that supersonic flight by Concorde will result in considerable damage and even death underneath its flight path. If those are not the actions of the lunatic fringe of the anti-noise lobby I must be greatly mistaken in my recognition charts, because I think that I know a lunatic fringe when I see one. The Amendment is a lunatic fringe Amendment if ever there was one. But I do not propose to devote a good deal of time to the arrant nonsense with which the hon. Gentleman has sought to bolster his case, because it would be appropriate for the Minister to shoot down his hon. Friend on this occasion and to recognise
      500
      that the sniping comes from not this side of the House but from his own benches.
      Mr. Hugh Jenkins: The hon. Gentleman may be an authority on the lunatic fringe, but I know rather more about flying than he does, as I did quite a lot of it during the war.
      Mr. Onslow: I would, of course, yield that to the hon. Gentleman: and even when it comes to lunatic fringes, I am sure I make no pretensions which he cannot match and outweigh.
      The Amendment happily gives us the opportunity of asking the Minister certain questions and putting to him certain points which are crucially important in the context of what we are considering, which is voting large sums of money to a project which we wish to succeed. I should like to ask him these questions in the expectation that he will be able to give me satisfactory answers and by so doing demonstrate his confidence in the project and carry the House with him. I believe that almost all hon. Members in the Chamber, on whichever side of the House they sit, share a desire to see it succeed and believe that it can succeed, but we have the right to make sure that all the necessary precautions are taken to ensure success, and that all the necessary thinking has been done to overcome the obstacles so far as they can be anticipated.
      If some of what I have to say touches on the question of the noise Concorde makes in operation, this is perhaps partly due to the fact that, last Thursday, the House was denied an opportunity to air its views on the subject by a typically shabby device by the Government Whips, but I think that, on this occasion, I can still stay within the rules of order.
      The economics of Concorde depend upon its acceptability in airline service and its viability in airline service depends largely on the social effects it will have, particularly the noise effect. There are two particular types of noise of special interest in this context. The first is environmental noise—the noise it is likely to make on the ground when engines are being run up and tested. Are adequate muffling devices being developed? Is money being allocated to see that these are installed at airports from which Concorde is likely to be flown?

      501
      Coupled with this, there is the question of the special take-off and approach techniques which will be necessary. We know from the Wilson Report on noise that this problem has been foreseen for some years. On page 72, it was said:
      "In view of the much greater engine power in supersonic aircraft, careful planning of the take-off and initial flying techniques will be needed if noise is not to be spread over a considerably greater area."
      This point was also touched on in the Report of the International Conference on Aircraft Noise in London in 1966. There again, it was specifically commented that
      "Supersonic transport aircraft…require very large engine powers and cannot use the lower exhaust velocities appropriate to subsonic aircraft. In spite of certain compensating advantages, it should be recognised that these aircraft present a special problem, especially as regards lateral noise at take-off."
      What steps are being undertaken now to estimate the likely noise levels which will be caused by Concorde in normal operation? What attempts are being made to establish monitoring procedures and to see whether air traffic control procedures will have to be varied so that these aircraft become fully acceptable in normal airline service?
      It is essential that airlines should know as far in advance as possible what modifications of procedure they may need and what additional training they may have to give their crews. Does the Minister expect Concorde's noise levels to fall within the 110 P.N. d B. by day and 102 P.N. d B. by night, which are the present accepted standards and which we may sec agreed internationally if the Government introduce noise certification?
      There has been a good deal of alarmist propaganda on the question of the sonic boom and I am sure that the hon. Member for Putney could have quoted more examples if he had not wished, understandably, to be brief. The acknowledged prophet of boom is Dr. Bo Lundberg and I have here an article by him which purports to reproduce the sort of pattern of boom noise which the inhabitants of Southern England might expect if unrestricted supersonic flights were allowed to take place between continental airports and airports in the United States. The Minister should tell us what consideration he is giving to this question, of overflight and what planning is going
      502
      on to see how Concorde can be routed away from heavily populated land masses.
      What talke are being held on an international level on the other side of the Atlantic, with the French and possibly also with the Irish Governments? We need to be assured that the issues are undersoood and that people are informed about what is involved and know what the Government are doing to undertake the necessary precautions. We had some tests last year which succeeded only in showing how tests should be run. Will the Minister be able to satisfy us that at an early stage in the Concorde flight programme proper noise tests will be undertaken to establish precisely what sort of noise is likely to be involved when the aircraft comes into airline service?
      It being Ten o'clock, the debate stood adjourned.
      Ordered,
      That the Proceedings on the Industrial Expansion Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Benn.]
      Question again proposed, That the Amendment be made.
      Mr. Onslow: I hope that the Minister will not make the same psychological mistake which he made last year, because it is most important that there should be an informed understanding of what is involved and that the people who wish to "knock" Concorde, those who are opposed to it, should be answered by reasoned, informed and carefully thought out information which those like the Minister are placed to give.
      I want finally to deal with the slippage of the project, a subject which I discussed in the debate on the Money Resolution. I put it to the Minister then that it was the Government who were responsible for the apparent slippage of the first Concorde prototype, 001. The Minister seemed surprised that I should advance this line of argument, so I will expound it again very briefly. It is generally known that the Government have been less than enthusiastic about Concorde more than one since 1964. As a consequence, our French partners in the project set a date for the first flight of their prototype which was not realistic from an engineering point of view.

      503
      It was deliberately optimistic, perhaps as a means of showing the workers engaged in the project on the French side that the French Government at least meant business. When it was found, quite understandably, that this first date could not be met, there was an appearance of slippage in the project as a whole, and there have since been technical reasons for still further delay.
      I hope that the Minister will tell us what I believe to be true—that this slippage is not crucial to the project as a whole, that although time may have been lost so far, it can and will be made up and that the project will come forward for a certificate of airworthiness and for production according to the time scale laid down by the manufacturers. There is no technical reason to expect further serious delays and the only important delay which might now happen would occur if the Government were to lose their nerve, if, when the first successful flight has taken place, there should come a point when the Treasury gets at it again to cause a change of mind and when there might be a situation in which the whole project could be in danger of cancellation.
      This would be a tragedy and I hope that the Minister can assure us that in such a situation he would continue to fight for Concorde and that he sees no reason to suppose that anything is likely to occur which might sabotage the success of this great venture.
      Mr. John Rankin: I should like to express my gratitude to my hon. Friend the Member for Putney (Mr. Hugh Jenkins) for raising this subject again. He is doing us a service by giving us an opportunity, which has been denied to us all too often, to consider Concorde and to examine what is being said about it, and once again to hear Ministers express their confidence in its future.
      On Friday, my hon. Friend chose as his theme the fact that Concorde will make noise which will not be acceptable to a great many people. Tonight he has raised the issue of costs. On Friday I pointed out that the noise problem with Concorde has been grossly exaggerated. It has been put out of perspective in my view for propaganda purposes, directed
      504
      towards stopping the production of one of the greatest adventures in civil aviation that this nation has ever undertaken. My hon. Friend should think of that aspect.
      Today the whole of the Aviation Group on this side of the House, over which I have the privilege of presiding, spent its time at Southend. There we had a look into the research and experimentation work flowing from the construction of Concorde. This is intricate, highly scientific work, employing the skills, abilities and research intuition of some of the most distinguished scientists in Britain. They are trying to overcome some of the problems created by Concorde. Naturally it has created problems, but we are solving them. Noise is one such problem.
      The hon. Member for Woking (Mr. Onslow) referred to the 1966 conference which I had the privilege of attending, as I assume he did. In our spare time at the conference I discussed such problems as noise and cost with those at the conference. I asked them if noise could be reduced and their answer was, "Yes". But they said it would be at a price. We recognise that scientific development means, in many cases, an inevitable advance in prices.
      How will this noise affect people? Will it deafen us, disturb us, waken us up at night and start the baby crying? I pointed out earlier that the answer to that is, "No". This is because there is only one airport in Europe which will fly Concorde over this country and that is Frankfurt Airport. That will be at supersonic speed. Everyone interested in the project knows this. Every other airport will send Concorde across the English Channel. The noise problem will not materially affect us. My hon. Friend said we were starting on this project ab initio, from the beginning, with no scientific knowledge behind us. That is not so, because we have a great deal of experience in manufacturing supersonic aircraft for military purposes. This is not the first aircraft derived from the knowledge which we acquired and expanded in producing military aircraft.
      Sir Harmar Nicholls: The difference of view between the hon. Gentleman and his hon. Friend is interesting. As there are some definite

      505
      pieces of knowledge on the official records, would the hon. Gentleman be prepared to suggest to the Minister that, instead of following the normal procedure and answering the debate when all hon. Members have spoken, he should make his contribution next so that what he says can be examined by those who speak after him?
      Mr. Speaker: Order. It is not in order for the hon. Gentleman to arrange the debate.
      Sir Harmar Nicholls: The hon. Member for Glasgow, Govan (Mr. Rankin) gave way to me, Mr. Speaker. I am saying to him that it would help us if the Minister would speak next, and the Minister of State could answer any further points which are raised.
      Mr. Speaker: Order. I make again the point which I made just now. It is rot in order for the hon. Gentleman to attempt to arrange the debate.
      Sir Harmar Nicholls: On a point of order. It has been shown that we are debating a very technical matter. To follow the normal course of the Minister answering at the end of the debate may not do justice to the subject. I think that it is perfectly in order to suggest to an hon. Member who has the Floor of the House that that new procedure may be followed.
      Mr. Speaker: I am grateful to the hon. Gentleman, but the debate will take its normal course.
      Mr. Rankin: I am always ready to give way, but, when I do, I hope that the time which I yield is not abused, which the hon. Member for Peterborough (Sir Harmar Nicholls) has done. Had I known his design was evil, I should not have given way to him.
      506
      The questions of cost and noise are hived off together. Noise can be mitigated by geographical considerations and the expenditure of more money. Most of those interested in this project do not want more money to be spent on its production. In my view, there is no need to spend more money when the glidepath of the aircraft will not be so closely related to the land journey.
      The attitude of operators to this aircraft shows their confidence in it. I believe that there are 75 operators on the waiting list for this aircraft. Anyone in touch with the operating side of aviation knows that operators cannot afford to squander their money in any venture. Most of them are operating almost on a shoestring. The fact that operators are backing this aircraft shows that they have confidence in it. Since they are the people who must run it to produce a surplus, there is no reason why we should demean its qualities.
      I am sure that my right hon. Friend and hon. Friends will not be discouraged in forging ahead with this great venture. On Friday, my hon. Friend the Member for Putney, in speaking on the noise aspect, was supported by some of my colleauges. There is a vast amount of propaganda about the cost of this aircraft. On Friday night, the Evening Standard published an article which was not helpful to the future prospects of Concorde. I do not suggest that my hon. Friend is allied with the Evening Standard, but he is part and parcel of a barrage of opinion which has been generated in this country by powerful influences to damn this great project. I hope that that will not in any way lessen the courage of my Government, and of my right hon. and hon. Friend in particular, to forge ahead with one of the greatest steps in aviation that we have ever taken.
      Mr. Speaker: I remind the House that this is one of a number of Amendments that we are discussing.
      10.15 p.m.
      Mr. Eric Lubbock: I do not think that the hon. Member for Glasgow, Govan (Mr. Rankin) is quite right in saying that there has been a sustained propaganda campaign against the Concorde, if by that he means an article in the Evening Standard, a newspaper whose views do not echo those of the people as a whole, and one or two letters that one has had from people whose anxieties have been provoked by these articles. I think that the campaign is a trivial one, and it need not worry the Minister, the B.A.C., Sud-Aviation, or anyone else who is interested in promoting the future of this aircraft.
      Mr. Rankin: I should have said that the newspaper article was merely one example, because, as the hon. Gentleman knows, there has been continuous Press propaganda against this aircraft.
      Mr. Lubbock: I do not think that there has been all that much of a Press campaign against the Concorde. I have not noticed it, and it has not added to my correspondence, as I find generally happens with campaigns which are well conducted and properly undertaken in the Press. There may have been an article or two, but it has not impinged on the consciousness of readers to the extent that they have taken up pen and paper and written to me about the implications of this project. I am glad that the influence of the few journalists who have written against the Concorde has not been more extensive, because I agree with the hon. Member for Govan that we must press on and complete this project if we are to derive any benefit from the large investment that we have made.
      That is something which the hon. Member for Putney (Mr. Hugh Jenkins) tends to forget. If he wants us to stop at this point in time, he must be prepared to recognise that we would have to write off a large sum of money which has been put into the Concorde by British and French taxpapers.
      Mr. Hugh Jenkins: It is better to write off the large sum of money which has been put into this project now than to proceed and have to write off an even larger sum of money at a later date.
      Mr. Lubbock: A calculation has been made of the benefits which we can expect to derive from the Concorde when it comes into production. Contrary to the view held by the hon. Gentleman, I believe that a large number of airlines will purchase this aircraft and that it will be operating all over the globe in successful competition with the subsonic jets which will be in existence at that time.
      When the Boeing 707 and the Douglas DC8 were introduced, everybody said that they could not operate in competition with the piston-engined aircraft of the time. They said that these aircraft would be too expensive, too noisy, and too sophisticated for the airlines to operate. They were proved wrong. The first Douglas pure jet aircraft was cheaper than the piston-engined aircraft, and cheaper than the turbo-prop aircraft which were operating at that time.
      We had a long argument in the House about why the B.O.A.C. had to write off its investment in the Douglas DC7 and the Britannia aircraft, which were very fine in their time, but they were too late. After they came into operation, they were overtaken by this new advance, and they were not competitive. People wanted to fly in the new aircraft, and so we had to agree to write off a large sum from the B.O.A.C.'s capital investment so that it could start again on a new footing.
      I will not be surprised if, when the Concorde begins to operate on the airline routes of the world, a great many passengers will want to travel in it. It will be a more modern aircraft, faster than other planes, in many ways more attractive than subsonic jets, and all these features will attract passengers. It will, therefore, have a high load factor, and this is the secret of success in airline operations.
      Although the hon. Member for Putney considers that it will be more expensive, he is right if he is comparing it with other aircraft on the basis of the cost per seat mile. It will be more expensive than, for example, the Boeing 747, which will be introduced at about the same time or perhaps slightly earlier than the Concorde. However, if people would rather travel on the Concorde, as I have no doubt that they will, the cost per seat mile factor will not be the important consideration.

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      We have seen in the past how passengers prefer to travel in certain types of aircraft. We saw it with the Boeing 727. I wish to be impartial and mention American aircraft as well. We saw it happen with the B.A.C.111, the Boeing 737 and the Trident. The VC10 has been an outstanding example. As soon as these 'planes were introduced in competition with older equipment, passengers flocked to them, and we are witnessing that with the VC10.
      The load factor on the VC10 services on the North Atlantic is fantastic. I do not know why Sir Giles Guthrie has stopped publishing the figures and some doubts have been expressed about his reasons. It has been suggested, for example, that as Sir Giles was not keen on the VC10, when it was first introduced, he is rather embarrassed by the success ii has achieved. I will not say whether that view is right or wrong. Sir Giles has always told me that he is keen on the VC10, and that he wanted it to succeed.
      Mr. Speaker: Order. The hon. Member will, I hope, get back to the Concorde.
      Mr. Lubbock: Without going into further detail, I hope I have said enough to show the enormous attraction of new equipment on any route compared with older aircraft. I hope that the hon. Member for Putney will now accept that it would not be unusual if the same thing happened to the Concorde; that as soon a,; it starts flying on the North Atlantic acid other routes the airlines which have ordered it—the hon. Member for Glasgow, Govan (Mr. Rankin) referred to them and I will not repeat them—will tend to draw passengers from existing subsonic jets. The Concorde will, as a result, operate at a very high load factor, so that its cost of operation in terms of cost per seat mile will not be an important factor.
      No reference has been made to the advantage we have over the Americans in terms of the years' lead we have over them in introducing a supersonic airliner. We read in both the technical Press and the national newspapers that the Americans have run into serious difficulties with the Boeing 2707 and that it has had to be substantially modified. This has put that aircraft perhaps two or three years
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      back on the date when it was supposed to come into operation. The British and French, with their Concorde, have an absolutely fantastic market opportunity, with a lead of as much as possibly five years.
      While many people are reluctant to estimate the lead—they say that if we become too complacent and allow the Americans to catch up that would be dreadful, a view with which I agree—and while we do not want to exaggerate the lead we will have, I suggest that it appears that we will have a lead of about five years. If we can maintain this lead, sales for the Concorde—which in any case are much larger than the 100 mentioned by the hon. Member for Putney—will increase. The world's airlines which have placed orders for the Boeing 2707 thinking that they will not need an interim stage to a Mach 2 airliner such as the Concorde will, when told by the Americans that the delivery date of the S.S.T. has been pushed back, come on bended knee and beg to be included in the queue for the Concorde. I hope this will happen, and I sincerely believe it will, as the delivery dates of the Boeing 2707 become apparent to those airlines which have failed so far to place an order for Concorde.
      The other thing the hon. Member for Putney has missed, which is of vital importance, is the employment Concorde will give to the aircraft industry, to workers in Bristol and other establishments of B.A.C. who are working on the frontiers of knowledge, although not quite to the same degree as the hon. Member for Putney suggested. Supersonic flight is not beyond our knowledge. For many years military aircraft have been flown at speeds of this order. The technological problems of making an aircraft fly at Mach 2 are well-known to the Royal Air Force, to the Royal Aircraft Establishment, Farnborough, to the engine manufacturers and to thousands of people in the aircraft industry as a whole.
      It is nonsense to suggest, as the hon. Gentleman has, that we are pushing so far beyond the frontiers of our existing knowledge that Concorde is likely to come unstuck. There will be technical problems, as there are with the introduction of any new aircraft, but they are not problems beyond the reach of existing technologies. The materials which we are using and the type of engine which

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      we have adopted are within the boundaries of our existing knowledge, which is not the case with the American S.S.T. All the materials and the technologies and the aerodynamics are quite different from anything which has gone before.
      Mr. Hugh Jenkins: If the hon. Gentleman had allowed me to intervene earlier, I could have saved him a lot of trouble. I was saying that we know very little about boom and its effects.
      Mr. Lubbock: I was just coming to that. It is a great mistake to intervene, as I pointed out to the hon. Gentleman who intervened in the Minister's speech. It means that one's own speech continues longer because one is reminded of something which one had missed out.
      The boom is of great interest to those people who live in the neigbourhood of airports. The hon. Member for Putney has given the general public the mistaken impression that the sonic boom will be a special problem in the neighbourhood of airports.
      Mr. Benn: No aircraft would be flying supersonically as it came into an airport.
      Mr. Lubbock: Exactly. [Interruption.]
      Mr. Speaker: Order. There is too much supersonic noise at the moment.
      Mr. Lubbock: I entirely agree with the Minister. The hon. Member for Putney created the impression that anyone living in the neighbourhood of an airport would be subjected to sonic boom. I have had letters from people living in the neighbourhood of Heathrow and even Gatwick. They have read the hon. Gentleman's remarks and think that because they live in the vicinity of an airport they will be subjected to a nuisance far beyond that which others have to endure. This impression should be corrected. I am not saying that one speech from me will do it, but I hope that the Minister will underline this whenever he speaks of Concorde that he will recomend his hon. Friends to say, "You will not be disadvantaged by sonic boom just because you live in the neighbourhood of an airport".
      Mr. R. Gresham Cooke: It is the best place to be.
      Mr. Lubbock: It is the best place to be, because immediately after take-off and coming in to land these aircraft are bound to be flying at subsonic speeds, and it is only when they get to above 15,000 ft. that they will make the transition to beyond the sound barrier. It will be something like 130 miles from the starting point when it crosses the speed of sound, and at the very great heights at which the aircraft flies the effect is far less noticeable.
      10.30 p.m.
      Of course, the hon. Member for Putney is right in saying that the flight paths from European terminals across the Atlantic must cross the British Isles if they start from Frankfurt or Brussels, but I do not think the hon. Member for Govan was right in saying that all these flights must be across the Channel unless there is some diversion of the Great Circle route which would be followed for maximum economy of operation. It would be better, if one can, to enable this aircraft to fly at supersonic speeds over land. Obviously, it would be more economic.
      A point which needs underlining is that no one knows what the effects of the supersonic boom from the Concorde will be. A few experiments have been made with much smaller aircraft which, as is well known, cannot be scaled up to the equivalent of the size of the Concorde; and the Americans, who have attempted much more extensive tests than we have, have said that to fly at supersonic speed, the sound—[Interruption.]
      Mr. Speaker: Order. It is not fair to an hon. Member who has the Floor for other hon. Members to carry on a steady conversation.
      Mr. Lubbock: It does not bother me, Mr. Speaker, but I am grateful for your protection.
      I was just saying that tests carried out by the Americans are admitted not to be a fair indication of what would happen with a much larger aircraft at a higher all-up weight flying at different altitudes. We have no idea, really, till the Concorde begins to fly what the effects of the supersonic boom will be under its flight path. I think, therefore, that the argument now is a waste of time.

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      One thing on which I would entirely agree with the hon. Gentleman the Member for Putney is that we should not make a final decision on whether the Concorde should fly at supersonic speeds over land till we have had an opportunity of seeing how it works out in practice. We have not very long to wait. The aircraft will be flying towards the end of this year, and shortly after that, in 1969, I hope it will begin the supersonic phase of its testing. That will be the time for the hon. Gentleman the Member for Putney to express his opinion, in the light of the reactions he gets from his constituents, and no doubt all the rest of us, will be able to do the same.
      For myself, I think Concorde will be an outstanding financial success for this country. I am a convinced believer that supersonic flight is going to come. I believe that many airlines will buy this pane, that it will bring immense profit to the people of this country from the investment which they will undertake under this Bill, that it will bring employment to many thousands of aircraft workers, and that it will keep Great Britain in the forefront of the technology of transport and communications.
      Mr. Edwin Brooks: The trinity of hon. Gentlemen who so far have contributed to this important debate following its initiation by my hon. Friend the Member for Putney (Mr. Hugh Jenkins) are entitled to claim they have given consistent and enthusiastic support to the Concorde project, as, indeed, have many hon. Members on both sides of the House. I yield to no one in my enthusiasm for and feeling of exhilaration at the ingenuity and skill shown by British engineering and technological expertise in this project, and I think all of us in this House, no matter what reservations we may have about its particular priority in our technological spending. are bound to feel we must wish this venture well now that we have embarked so far upon it. But, having said that, I feel that this sense of excitement at extending the frontiers of knowledge is a danger which we must particularly guard against at a moment like this.
      At times, listening to some hon. Members, I have felt that they are having almost a love affair with Concorde, and there is nothing more sterile than a love
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      affair with a machine, no matter how beautiful it is in shape. I sometimes wonder, for example, if Concorde looked like a flying bedstead whether there would be quite the same sense of excitement about it. But no, we look at the models, at these sleek, smooth lines and have a sense almost of sensuous pleasure and gratification. In the House such moments come all too rarely.
      Of course, this particular technological advance is, like many others, a matter on which we could easily be overcome by enthusiasm. We could no doubt talk just as enthusiastically about rockets to the moon. [An HON. MEMBER: "What about the tunnel?"] I am not sure what curious Freudian train of thought is exciting my hon. Friend when he talks about tunnels. There have been similar ventures in the past, what appeared to be exciting ventures of great technological promise but which forfeited all public confidence. One example was the airship, perhaps the most obvious comparison, where a particular technique was applied in the field of aviation which was to prove disastrous. Therefore we must be on our guard at moments like this against too much flabby talk.
      We are tonight in the position of shareholders being asked to look at a prospectus brought to us by a board of directors. They are a body of directors who in the past have been consistent in the respect that both they and their predecessors, whom they usurped in 1964, have shown a complete incapacity to tell what the cost of this venture will be. They have been consistently wrong in every major estimate they have brought to this House. I have no doubt that any estimates that we get tonight will similarly be proved wrong in the event. This would not necessarily matter if there were evidence that, no matter what we spend, the return will be such that the profit will be there for us, or at least our successors, to enjoy, but it is precisely this that we cannot be sure about. All the indications are at present that there will be no profit and that there will be a net loss at the end of day, or probably at the end of the 1970s.
      The reasons are quite obvious. If we are claiming tonight—with such enthusiasm—that we are justified in spending £125 million of the taxpayers' money, in

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      addition to the £280 million already committed, using knowledge and facts which are incontrovertible, those facts would be as incontrovertible to a body of private shareholders in the aviation industry. Yet they do not come forward and express the same enthusiasm. There is no money coming from private industry.
      One of the extraordinary things about this debate has been to listen to hon. Members opposite who are so often regarded as the guardians of the public purse, reluctant to buy a pig in a poke and wanting to know what is involved. They have been decrying those who want there to be some sense in the financing of this venture. [Interruption.] The hon. Member for Peterborough (Sir Harmar Nicholls) is suffering from a form of verbal diarrhoea tonight. This constant flow of interruption which comes across the Chamber we could well do without.
      I think we have a right and an obligation to put one or two questions to the Government. These fall into two parts. In the first place I ask for more details in the breakdown of the costs which have been incurred or are about to be incurred on the research and development side of the project.
      Secondly, we have to ask certain questions about the implications of what we are doing in terms of production financing. Hon. Members have had figures flung back and forth for some years about the escalating costs of Concorde. We are all familiar with the way in which the figures have gone up steadily since that great dawn of expectation in 1962 when it was thought that the project would come to something less than £200 million in research and development costs. Hon. Gentlemen should ask themselves what they know about the breakdown of the global sums which we throw about this Chamber.
      How many hon. Gentleman have any idea of what is involved in the £80 million which is put down to post-certification expenses? Is there a single hon. Member who can break down that figure one stage further? We have no idea of the calculations and the criteria involved. Is there a single hon. Member who knows the breakdown of the £50 million which was so gaily added in 1966 as an overall
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      contingency? Were any other contingency sums written into the project? If not, why not? If so, what were they? No one knows, and it is little short of scandalous that, when we are asked to discuss the addition of another £100 or £125 million to the venture, we should have no information on which we can assess the basis on which the earlier calculations of research and development costs were made.
      I am concerned about this production financing, because it seems to me that the wording of subsection (2) is so open-ended that there is no control upon the Minister. I beg hon. Members, no matter how enthusiastic they are about the venture, not to allow their enthusiasm to betray them into abandoning all forms of control over Ministerial expenditure in the years ahead. It is wrong to see in proposed legislation such words as
      "Any such arrangements may provide for financial support to be provided by the Minister…by any other method which the Minister considers appropriate."
      There is no check upon the Ministerial discretion in this regard.
      One wants to know, for example, what will be the sort of return which will eventually come from the project. No one expects a precise figure. Clearly, that is impossible. But one wants to know if the Concorde will be sold at something like £5 million, £7 million, £10 million or £12 million. Surely we have the right to know, somewhere within these enormous orders of magnitude, what sort of price the aircraft will be to the world's airlines. When a body of shareholders is asked to put money into production financing, it has the right to know the market prospects for the commodity, and they cannot be assessed unless the envisaged selling price is known. Surely we have come to a point where we can begin to talk meaningfully of figures as important as these are.
      The sum which we are discussing is almost equal to the total expenditure involved in the rest of the Bill. It is wrong that we should be asked to spend this enormous amount of money on a project about which we have such a basic lack of information. I have some symparty with the hon. Member for Peterborough, because he is right when he says that there is a remarkable lack of technical information about it.

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      It is extraordinary that, the night before this Clause was to be discussed in Committee, my right hon. Friend sought information from the Library on certain basic facts about the project. I have great admiration for the work being done by his Department in many spheres of activity, but it is not good enough for such essential information to be obtained literally at the eleventh hour so that the Committee could be placated into thinking that all the information was available. When one looks at the information, one finds that it is not particularly meaningful, in any case.
      My final point, therefore, is a simple but obvious one. We have no alternative tonight but to support the venture. Like many other hon. Members, I have been suspicious of some of the objections to Concorde. Though I have often criticised it, I suspect that some of the objections to it may have been motivated by commercial considerations from across the Atlantic. I do not want to forfeit any opportunity for the country to gain the massive export potential which conceivably could come from Concorde in its present stage of development.
      10.45 p.m.
      This House—and this is a question of Parliamentary democracy and control over the Executive—has a right to expect a vastly greater amount of information than has been offered. It is right to ask the Government, in consultation and collaboration with the French Government with whom they are so intimately linked i a this venture, to produce a complete and detailed breakdown, the sort of prospectus that a body of shareholders would have the right to expect at this stage. If the Government are as convinced as they claim to be about the success of the venture, this is a good opportunity for an explanation of the potential of the project. If we are serious now about stressing its commercial potential, now is the time to start selling hard, and to have done with the timorous, question-begging nonsense we have had to put up with in some of the Press.
      Sir A. V. Harvey: The hon. Member for Bebington (Mr. Brooks) said something to the effect that the Government had been consistent on Concorde. The present Chancellor of the Exchequer went to Paris three years ago to try to cancel the project—
      Mr. Brooks: I said that the hon. Gentlemen who had preceded me had been consistent.
      Sir A. V. Harvey: I hope I did not misunderstand the hon. Member. That happened. It was one thing the Chancellor tried to do, but he failed in it. He could not get away with it. I agree with all previous speakers that the House needs more information about the vast sums that are being spent, and needs quarterly progress reports in a White Paper or in some other form on the figures, performance, and troubles, without knocking the project.
      I think the hon. Member for Putney (Mr. Hugh Jenkins) had his tongue in his cheek when he spoke. I think he is concerned about votes at Putney, as he has every reason to be after seeing what happened here yesterday afternoon. I am sorry to hear him knocking Concorde, because some years ago we had many speeches about the VC 10 which did infinite harm to its prospects for overseas sales. It was said today by the hon. Member for Orpington (Mr. Lubbock) that it has the highest load factor on the North Atlantic. I hope we will not knock Concorde at this stage. We should back it. It is one of the few things about which I have agreed with this Government.
      Mr. Hugh Jenkins: Will the hon. Member give way?
      Sir A. V. Harvey: I want to get on with my speech.
      Mr. Jenkins: The hon. Member has made an assertion about me and should let me reply. There are no votes to be gained from knocking Concorde, but even if there were I would still knock it.
      Sir A. V. Harvey: We have heard the hon. Gentleman make many speeches and ask many Questions which have had publicity. He has done his best to knock Concorde, and it is regrettable.
      Where a company or Government have a project of this magnitude, it is impossible to estmate what it will cost. We are nearly reaching the stage where this is too much for France and Britain together, but we have got to the point of no return and we have to go on with it. We should. It is the largest airframe venture we have today, and it is a tremendous thing for Britain that our technicians

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      should be involved. The Americans are worried and amazed at the progress being made, allowing for the difficulties of language, working with Sud-Aviation. I disagree with the reports that there is conflict between the two sides. I think that there is less conflict than there is sometimes between sub-contractors in this country. There must be friction over some things, but the project is a great thing for Britain.
      Today we have a five-or six-year lead over the United States, and that is enormous. My biggest fear about Concorde is that if it is a success when B.O.A.C. or Air France want to fly from Europe to Kennedy Airport they will have troubles, because I believe that the Americans will do everything they can to stop the aircraft from landing in the United States, on that very question the hon. Member for Putney keeps advertising every few weeks, that of noise. The Minister must get close to his opposite numbers in the United States to try to get that problem sorted out, to see that there is not the lobbying and dirty work that can take place on these matters, for otherwise it would be a wasted effort to a large extent.
      The Concorde will have a passenger appeal. The jumbo jets will carry 400 passengers, but people will not like flying in an airframe with 400 passengers. Imagine the difficulties of lavatories alone on a flight over the Atlantic, with 400 people queueing for the lavatory. It is quite a problem when people are being carried great distances, and the thin fuselage, such as Concorde, will have an appeal to passengers.
      Have suitable arrangements been made for the insurance of the aircraft? Who will insure it? It is a problem that the insurance companies of Britain probably could not carry alone. Will the Government have to become involved?
      People say that they would like to fly subsonic, and that it is enough to go along at 600 miles an hour, but that is not the case. People will fly in the fastest aircraft. I do now know that there are many volunteers here tonight to fly in the maiden flight across the Atlantic, but once it has been tried out it will be popular. Even flying up and down to my constituency, between London and
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      Ringwood, a journey on which I have done about 500 flights, if I can get on a Vanguard, which saves about 10 minutes as opposed to a Viscount, I am happy to do so. I think that there will be a similar preference for supersonic flights over the Atlantic and elsewhere.
      Concorde has a great future and it behoves every Member of Parliament to be sincere in backing the project, now that it has reached its present stage, while recognising that there are problems with noise. The best service the Minister can do is to keep the House and public fully informed of all matters, good or bad, relating to it.
      Mr. John Wells: I shall be as brief as I can be, and after some of the extremely erudite and high-falutin' aeronautical speeches I shall also try to be very simple.
      The hon. Member for Putney (Mr. Hugh Jenkins) has done the House a considerable service in bringing before us a fundamental problem which will undoubtedly be created by the aircraft. To my mind, the purpose of all technological improvement and advance is to further civilisation. We were bored by a very lengthy speech by the hon. Member for Orpington (Mr. Lubbock), who has now left the Chamber. Whether the voter lives in Putney or Orpington the fact remains that the man in the street will suffer from increasing noise. My hon. Friend the Member for Macclesfield (Sir A. V. Harvey) pointed out some of our duties as Members, and at the same time the pitfalls that lie ahead of the Government. He was very right when he called on the Minister to give us progress reports and keep us informed of the steps he will take in his negotiations with the Americans to see that the noise is not looked on as a barrier to the aircraft's operating from Kennedy Airport. If aircraft of this sort are to take off from Frankfurt, they will be the ones which cross the southern English land mass, and we in this country will experience the worst of the German noise traffic. We must, therefore, protect our own interests. I hope that the Minister will look specifically at the overflying rules as they will apply to this aircraft.
      The Ministry of Defence—I think particularly of the Under-Secretary of State for Defence for the Royal Air Force—

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      has been extremely helpful to those hon. Members who have had constituency problems as a result of low-flying aircraft and damage to farm stock. I refer mainly to poultry, sheep and glass houses, those items which are physically damaged by aircraft. We are considering now the financing of the Concorde project. What will be the position as regards compensation? If German-owned aircraft overfly this country and do damage, will our own Ministry bear the consequences? Will there be the same degree of financial cooperation on claims from the Ministry of Technology as we have enjoyed from the Ministry of Defence in the past?
      Mr. McMaster: We have heard Jeremiahs on both sides deploring the support provisions for the Concorde project. I imagine that in former days similar protests were made in the House about the steam engine, the internal combustion engine and even the development of the jet engine, all of which are noisy. Anyone living beside a motorway will admit that the ordinary motor car engine makes a tremendous noise. I say, without any particular slant at my hon. Friend the Member for Maidstone (Mr. John Wells), that the hon. Members for Putney (Mr. Hugh Jenkins) and for Bebington (Mr. Brooks) made me think that they would prefer to see the Government spending money breeding bigger and better T.U.C. cart horses rather than developing this modern exciting aircraft.
      It is vital that Britain retains her industrial leadership in the world. There are few parts of the world as densely populated as the United Kingdom. We cannot hope to be self-sufficient. We must export in order to live. In order to export, we must be enterprising, we must spend money on research and development, retaining the technological leadership in the jet engine, in supersonic flight, and in any other modern advance which will enable us to compete with our rivals, whether they be the Americans, who are spending vast sums of money on aircraft development, whether they be in Europe, or whether they be in the Far East, the Japanese in particular.
      We need a project like the Concorde in order to focus the enterprise of our young scientists and engineers. It is not enough simply to spend money in vacuo
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      on research and development. We must have a specific project like the Concorde project. I am glad that the hon. Member for Putney has given us an opportunity to debate the matter, because a vast sum of public money is being put into the project, but I deplore the proposal to cancel the support Clause in the Bill. The Bill is, perhaps, like the curate's egg—good in parts, and bad in parts. This is one of the better parts of it. I strongly oppose the Amendment.
      Dr. M. P. Winstanley: I should first explain the brief absence of my hon. Friend the Member for Orpington (Mr. Lubbock). He has had to leave the Chamber to find out for how long he spoke.
      11.0 p.m.
      I make no apology for speaking, despite the fact that my hon. Friend the Member for Orpington has spoken, particularly because hon. Members will recall that on Friday, when the House was engaged in discussing this very matter on a Private Member's Bill dealing with aircraft noise, the Government Whips saw fit to count out the House before a number of hon. Members, including the hon. Members for Twickenham (Mr. Gresham Cooke) and Woking (Mr. Onslow), had had an opportunity to speak and before the Minister of State, Board of Trade had had time to answer. It is therefore perhaps necessary that we should be delayed tonight so that we might have some of the answers which we could have easily had on Friday had the Government allowed the debate to continue so that the Minister of State could give the answers which I believe he was ready to give. I hope that the Minister tonight—at this later hour, for reasons which are not his fault—will deal with the points raised.
      I do not propose to involve myself in the economic and aeronautical aspects of this matter, but I look forward to hearing answers to some of the questions put by the hon. Members for Macclesfield (Sir A. V. Harvey) and Bebington (Mr. Brooks). I was particularly interested in the suggestion of the hon. Member for Macclesfield about having a regular report on progress.
      A number of hon. Members have referred to the level of noise. Will it be acceptable? We have heard various

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      estimates of perceived noise decibels. Hon. Members asked what will be done about certification procedures. I urge hon. Members to accept that there are vast differences about the degree of tolerance exhibited to different levels of noise. We cannot fix' a level which will be satisfactory. It is important that hon. Members should realise that.
      Some time ago I was concerned in a fairly detailed investigation into noise and its effects and the tolerance of noise by different people—not only traffic noise, but particularly aircraft noise. I interviewed many people living near airports. Their answers were the same as the answers we shall get on this problem of sonic boom. One would call at a house and ask about noise, and one of the occupants would say, "It is dreadful. My wife is in bed ill and I am nervous". At the next house one would say, "What about this noise?", and the answer would be, "What noise?".
      We will not be able to establish a level and say, "This is tolerable and nobody will mind". Whatever the level established, people will mind. It would be a mistake for the House to assume that it can find a magic number and that as long as we stick to it everything will be all right.
      Sir Harmar Nicholls: Could the hon. Gentleman say what amount of noise would keep the Leader of the House awake?
      Dr. Winstanley: The answer to that question has been established on an experimental basis. We must now determine what noise will put him to sleep again.
      It is a mistake for us to assume that this kind of noise will be more distressing than others. My view is that the evils and nuisance of conventional aircraft noise constitute a much greater problem than the kind of problems we are likely to have from supersonic aircraft noise. Therefore, we may not be subjecting the public to greater noise by this Clause but moving towards a situation in which we may be relieving them of some. Nevertheless, there are things to be said.
      It is right to remind the House that those living near airports are probably going to be in a better position than
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      others. I hope that the right hon. Gentleman will be able to tell us his thoughts in terms of over-flying, routes and so on. One would like to hear that in the end, the policy will be to site airports more and more at such places as estuaries.
      When we look at the experience of supersonic booms in the United States and elsewhere, we know that in the end it is tolerated, but only because people are persuaded that it is inevitable. When people believe something to be inevitable they think that they must tolerate it, and in the end, they do. Probably they are right in a land mass such as the United States, where over flying cannot be avoided. The same will happen in the European land mass. But it need not happen here. The dimensions of these islands are such that there is no real necessity for any supersonic over-flying. It is extremely important that if we are to get proper advantage from what may be a worth-while and valuable project, the understandable anxieties in the country should be allayed, and I hope that the right hon. Gentleman will be able to allay at least some of them.
      Mr. Hastings: The hon. Member for Bebington (Mr. Brooks), in a most able speech, expressed the misgivings of a number of people who perhaps do not share the enthusiasm I hold for this project. Does the right hon. Gentleman not think that perhaps one way of allaying public apprehension about the cost of this immense project might be for some Select Committee of this House to have a regular progress report, so that there is some sense of participation on a relatively expert level between the House and the management of the project? This might be a better and more satisfactory way of dealing with the question before us than on the Floor of the House.
      Mr. Benn: Clause 8 says, in effect, that, having built the Concorde, shall we make any for other people to buy? What we are really discussing is production finance for the aircraft. Although it is natural that hon. Members who are interested should want to broaden the theme a little, basically we are dealing with the next stage of Concorde. We have 001 and 002 almost complete and due to fly, and because of the importance in a matter of this kind of getting aircraft ready to sell as quickly

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      as possible we have to finance production before the proving flights of the prototypes.
      Perhaps I can begin by helping with the mathematics of the project, because there has been, even in some quite responsible newspapers, a confusion between the cost of research and development and the cost of production. The breakdown of our commitment to Concorde at the moment is roughly as follows: first, £250 million at 1966 prices on research and development. This is the latest agreed figure between ourselves and the French. I cannot guarantee that it might not go above that figure. I will say why, in a minute, it is impossible to make any clearer statement than that.
      In addition to this, £30 million has been or will be spent on intra-mural research at Government research and development establishments, broken down rounhly equally between the airframe and engine sides—that is to say, Farnborough and Pyestock.
      The next item—this must not be added to the research and development costs but must be kept separately in our minds—is the £100 million or possibly £125 million loans for production, which is what this Clause provides, and which up to £25 million will be bank loans at ½ per cent. above Bank Rate, under Government guarantee, and the rest will be Government loans on the minimum payable under the National Loans Act.
      In addition to this, there is £30 million for the purchase of special plant and tools which will be leased to the companies at the full economic rental.
      I spell out these figures rather carefully because even the Economist—[Interruption.] I am not referring to its views, for which I share the hon Gentleman's displeasure; I am referring to its figures in a chart showing the supposed escalation, in which it adds the production finance to the last estimate for research and development, giving a wholly false impression. There may have been some confusion, but the Economist added all the production finance to research and development and arrived at a figure which was very deceptive.
      The final point on financial liability is the possibility of some contingent liability arising in the event of a major failure at
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      a very late stage in production. It is very difficult to give any reasonable estimate of this. In the extreme circumstances of a catastrophe to the project at a late stage when deliveries of the aircraft off the production line had already started, the losses to be underwritten could exceed the amount of working capital of £100 million. Even assuming a coincidence of events which is highly improbable, there is no reason to believe that this total liability would exceed £200 million on the basis of the Concorde programme which we are now considering. Moreover, if anything of this kind were likely to go wrong, we would expect to detect it early enough and halt the programme before so much money had been spent.
      I feel it my duty, in bringing this Bill to the House with this Clause in it, that I should tell the House plainly that in going in for a project of this kind one is not only paying a substantial sum of money but one is also carrying, and the House is carrying, a substantial risk arising on the technical and financial side. I say this because I think, from many of the speeches which were made during the course of the debate, that the House wants to be brought into the inside of this project and not be treated as if it were just to be told optimistic things and just left at that. If we are to enter into this type of project the House wants to feel that it is in the picture.
      I find a little surprising the transformation of the party opposite when we come to an aircraft project as compared with other projects. Earlier we were told that civil servants were no good, that Ministers could not be relied upon and that lame ducks were about to be born. But when we come to this big aircraft project it is a matter of "Keep your nerve" and all these arguments are used on entirely different criteria.
      I say this as a statement of fact. The cost of being in the aircraft business is far beyond the capacity of the capitalistic system to bear the risk. This is true not only of aircraft. It will be true of other high-cost systems. It is, in part, a justification for the Bill. I make no more of this beyond saying that this is now very big business into which we are entering, and that is why it is necessary to come to Parliament to ask for authorisation.
      11.15 p.m.
      Mr. McMaster: How much of the £435 million is it expected to get back in sales of the Concorde?
      Mr. Benn: I was just coming to that.
      The questions which are put to me by many hon. Members are whether I will estimate the cost of the aircraft, the date of its coming into service, the market for it, and so on. I want for a moment to describe the nature of the equation with which we are dealing. There are two sides of the equation. There are the problems connected with production—that is to say, the technical problems of weight, thrust, drag and systems development, the time for doing this and the cost of doing it.
      On the other side, there is the market possibility for the project, which is affected by problems of airline demand, the prospects of airline demand, questions of sonic boom, to which reference has been made, engine noise and, of course, a factor which is entirely outside our control, namely, the progress being made by the Boeing 2707.
      Therefore, in the circumstances—and no hon. Member will expect me to do more than present this position to the House—it is impossible to anticipate what the market for this aircraft may be. If I am asked whether we are confident that it is an outstanding aircraft, the answer is, "Yes". If somebody asks whether we are doing our best to make it succeed, the answer is manifestly, "Yes". If, however, I am asked what the market for it will be, it is very hard to say.
      The reason why I mention this is that if, for some reason, the Boeing 2707 were to be withdrawn because of difficulties—and the Americans are operating in a higher range of technologies than we are—the whole world supersonic market might well be open to Concorde for an almost indefinite period.
      I put these factors to the House because, if we are to do this sort of thing, we have to know what we are doing. There is a possibility of difficulty—I put it no higher than that; there is also a possibility of the most outstanding economic and financial success.
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      Having said that, I come to the points made by my hon. Friend the Member for Putney (Mr. Hugh Jenkins). He has been very frank about it. He is firmly opposed to Concorde. I do not see why objection to Concorde should merit the description of "lunatic fringe". Even though I take a contrary view, it is perfectly permissible for an hon. Member to say that, on reflection, he thinks that Concorde is a mistake; that he thinks that it is a wrong use of resources; that there are certain medical and technical difficulties, and he has an interest in the problem of noise, which he has had for some time. I do not believe that the argument is much improved by charges and counter-charges of "lunatic fringe" in this matter.
      I would only say this about what my hon. Friend has said. In so far as he argues that over the years we have overemphasised research into air transportation at the expense of developments in surface transportation, he has a strong case to make. When he spoke of a wrong use of resources, he might well have argued that if we had spent more money on modernising the railway system, on introducing containerisation earlier or going in for fuel cell development or for the battery electric car, this might have brought a better return in terms of money or human enjoyment.
      Mr. Onslow rose—
      Mr. Benn: I had better not give way. Let me develop the point. I am only saying that it is certainly part of my purpose with research responsibility to tilt the balance a little more in favour of surface transportation and not to allow air transportation to be the only field in which major efforts are made. That is about all I will say in favour of my hon. Friend. Perhaps this is now a convenient moment to allow the hon. Member for Woking (Mr. Onslow) to intervene.
      Mr. Onslow: The fact that the right hon. Gentleman has had to put words into the mouth of his hon. Friend the Member for Putney which the hon. Gentleman did not use serves merely to underline that the Amendment is a lunatic fringe Amendment.
      Mr. Benn: I shall come to the hon. Gentleman's own speech in a moment.
      My hon. Friend asked me a number of questions and I think that I have been able to indicate why it is very difficult for me to answer them in detail now. He asked about the estimated cost of the aircraft to be sold to the airlines. This, of course, depends on the various proving flights yet to be held.
      He asked whether the overland flight of supersonic aircraft would be permitted in Britain, that is to say, whether the sonic bang would be acceptable. The answer is that the Government have not decided this, but it would be quite absurd to decide until we have heard what the boom of the Concorde will be like. He also spoke about technical uncertainty, suggesting that this aircraft would in some way be untested when it went into service. The plain truth is that although it pioneers new techniques in civil airliner development, there will never have been an aircraft as completely tested in all its systems as Concorde when it goes into service. On the technical and medical grounds my hon. Friend's argument is at its weakest.
      Mr. Hugh Jenkins: I should like to make it absolutely clear that I have not suggested that it will not fly or will fly badly. My reference to its being untested is a reference to the effect of the boom, and on that I am basically correct.
      Mr. Benn: I think that my hon. Friend underestimates the amount of supersonic flying which has been done by military aircraft. Until we know what the signature of the Concorde boom is, it will not be responsible for the Government to decide what action should be taken about it.
      I had many letters about noise matters last summer when it was said that we were brainwashing people into accepting the boom of those days. The truth was that the Government had not decided. There was no brainwashing into acceptance, but a genuine first step to see whether these aircraft over-flying supersonically would be tolerable.
      I come now to the speech of the Inn. Member for Woking. He asked a number of questions about the possibilities of muffling engine noise and about the noise of take-off. A great deal
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      of research has gone into this subject, but until we know the actual characteristics of a fully loaded Concorde with its engines at full stretch taking off in all appropriate conditions, we shall not be able to answer his questions authoritatively. This is obviously a matter of the greatest importance.
      My criticism of him for sniping at Concorde was based on the fact that he was continually questioning, almost with a view to suggesting that the Government had not done as much as they could to make the project a success. He went to extraordinary lengths to attribute the slippage to the Government. He said that because the Government had assessed the economic value of the project, as they quite properly did when coming into office, the French engineers hurried forward their date in order to put our minds at rest, that British engineers somehow assented to this and then it was wholly unrealisable, and therefore the slippage was due to the British Government's lack of enthusiasm.
      This argument does not stand a moment's examination and I very much hope that the hon. Gentleman will not pursue it. There is no truth whatever in the suggestion that the date was advanced because we were having a technical and economic analysis of the project. If the French had wanted to advance the date, it would have been open to our engineers, who are consulted about the whole planning of the project, to make their own points. There is simply nothing whatever in the hon. Gentleman's contention.
      I come, now, to my hon. Friend the Member for Glasgow, Govan (Mr. Rankin). He is a passionate advocate of the Concorde, and what he says is read with keen interest outside the House.
      The hon. Member for Orpington (Mr. Lubbock) made a very important point in saying that in assessing the economic value one has to take into account the money already spent, and that we are discussing the deployment of future resources. He also made another point of great validity, that the passenger appeal of Concorde, like the VC 10, could make a substantial difference to its operating costs, and hence to its acceptability to the airlines. I thought that

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      the hon. Gentleman was rather nearer the mark than my hon. Friend the Member for Bebington (Mr. Brooke) who spoke in terms of the sexual symbolism of the relationship between the Government and the Concorde, and compared it with the airship, a symbol of pneumatic bliss which would have an appeal of a different kind.
      I see the papers on this aircraft every day, I know the amount of work that is done by four companies and two Governments, and by the Treasuries of both countries as well, and by the Ministers and those who write about it, and I can say that there has never been a project so completely examined and re-examined in terms of its economic and technical possibilities as Concorde, and whoever else may be advocating this Clause on grounds of personal affection for Concorde in the sense that my hon. Friend suggested, I must not count myself among them.
      The hon. Member for Macclesfield (Sir A. V. Harvey) asked for quarterly progress reports. I think that there is a great deal of value in bringing forward information to the House as often as one can do so, but he will know from his business experience that shareholders do not hear of the ups and down, and hopes and fears, of major projects in the companies in which they have shares. We are here engaged in a commercial enterprise, and this conditions directly what it would be right or proper or sensible to make available to the House.
      Either he or the hon. Member for Mid-Bedfordshire (Mr. Hastings) suggested that there should be a Committee which could look at this quarterly. I think that the Public Accounts Committee's inquiries into the financing and development of the Concorde, and certainly other inquiries, such as that by the Select Committee on Science and Technology which will be looking at the defence establishments, and will therefore get some opportunity to study Concorde, provide as good an opportunity as one could hope for for studying the project. I also answer a number of Questions about it, but I shall look again to see whether we can give the House more information than we have in the past.
      I come, finally, to the question of noise, in a rather different context, and that is
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      the attitude to noise. During the war when aircraft were heard, people asked, "Is it one of ours or not?" and there was this curious feeling that the off-beat rhythm must be the Germans. I think it was thought that this in some way escaped detection by our primitive detection system. The attitude to noise depends, as the hon. Member for Cheadle (Dr. Winstanley) said, on one's viewpoint. If people think of Concorde just as an imposition by the engineers on the privacy of their lives, they will be hostile to it. If they think of it as the way out of our balance of payments deficit, their attitude to it might be different. If they think of it as being a supreme example of European leadership in advanced technology, again they might think of it differently.
      I conclude, I hope without any purple passages, by saying that the attitude of the public towards Concorde will in itself answer some of the questions which have been asked by hon. Members. We accept that annually thousands of people are killed on the roads, or are maimed and injured, because the motor car, even though we know the toll it takes, is regarded as a necessity, if not a pleasure, of modern life. There is no question of the toll of Concorde in terms of noise or damage approaching that which we have accepted from the mines, or from shiping disasters, or even from train disasters, and certainly not on the roads. But it is true that ultimately, whether we stop at the sub-sonic end, whether our dividing line is Mark 1, which is what my hon. Friend the Member for Bebington suggests—this is where he draws the line; at the speed of sound—or whether we go beyond it, will, in part, depend on the attitude of people to a development of this kind.
      I happen to think that the House, though looking critically at the project—as it must because of the amount of money involved—can help by regarding it as a fine example of British technology which should command the interest of the community, from whose skill it comes to be made.
      11.30 p.m.
      Mr. F. V. Corfield: Although I will not detain the House at this hour, I must remind the Minister that while he drew a contrast between the attitude of my hon. Friends

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      towards Concorde and such things as the Civil Service, we hope to make a profit out of the former though we have never made a profit out of bureaucracy.
      The two themes which ran through the speech of the hon. Member for Putney (Mr. Hugh Jenkins) as he attacked the Clause were noise and cost. In the past the hon. Gentleman has laid greater emphasis on the subject of noise. I accept that this is a serious problem, and nobody need apologise for emphasising it. However, the hon. Gentleman's argument in the past has usually been that we pay for these advanced aircraft at too high a price in terms of the damage caused by noise to amenities. But what price is he asking the country to pay for the standards he is setting?
      I was not able to be present last Friday, when the House discussed what was basically the hon. Gentleman's Bill, although it was introduced by his hon. Friend the Member for Kingston upon Hull, West (Mr. James Johnson). It was clear in that Measure that the hon. Member for Putney was aiming at standards which would put out of business every commercial aircraft coming to this country and would face British airlines and the airlines of every country using our airfields with phenomenal replacement costs. The secondary effects would be to drive traffic away from these islands, with consequent losses to our airlines, our tourist trade and our balance of payments. I suggest that the hon. Gentleman is getting the problem out of all proportion compared with what this country can afford, bearing in mind that the aircraft industry has in the past contributed substantially both to import and export savings. That has been achieved only because we have been willing to take the sort of risks about which the Minister was speaking.
      One cannot, whatever the cost, be certain how many of these 'planes we will sell. One cannot be certain of the conditions in which the first flights will be made or the first production models will come off. It is abundantly clear, however, that we are moving towards the production line, having made the aircraft, and that it would be crazy to hold back now. Although the cost has risen, so has the potential prize. This has happened for a number of reasons, not least of
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      which is the gradual widening of the gap between Concorde and the American SST.
      I cannot conceive the possibility arising when, as some of the main transatlantic and long-distance airlines have the Concorde, the other main airlines will be able to hold back if they cannot see the American SST reasonably soon on the horizon to take its place. The potential is very great indeed and at this stage the right course for us can only be to back it to the hilt. We should avoid doing anything which, as my hon. Friend the Member for Macclesfield (Sir A. V. Harvey) pointed out, would in any way reduce the possibility of this aircraft being not only a great technological advance but a great profit-winner as well.
      Mr. Hugh Jenkins: My right hon. Friend has the unusual attribute of being able to be wrong more charmingly and convincingly than most people can be right.
      It is a matter of opinion as to whether this is the right use of the fairly limited productive capacity of this country and of its substantial technological skill. On balance the facts add up to the proposition that this is a blind alley and a misuse of these resources, instead of a proper use of them. It is possible, of course, that I am wrong in this estimate, but what is abundantly apparent is that, even if I am right, I am not going to convince the House of that tonight.
      My hon. Friend the Member for Bebington (Mr. Brooks) has likened the attitude of the House to this project to a sort of sexual frenzy. I think it is nearer to a religious mania. The blind, touching faith of my hon. Friend the Member for Glasgow, Govan (Mr. Rankin) was, I think, very moving; the evangelical enthusiasm of the hon. Gentleman the Member for Orpington (Mr. Lubbock) was equally moving in its way. But these things are impervious: it is impossible to break through this sort of conviction, and I shall not attempt it tonight. Standing at a distance from that sort of orgiastic atmosphere it may seem, to those hon. Members involved in it, that one belongs to the lunatic fringe, but I feel that the reverse appears to be the case. However, as the House will not be moved on this subject tonight, I hope I may have its permission, as I beg

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      to ask leave to withdraw the Amendment.
      Amendment, by leave, withdrawn.

    Clause 10.

      AMENDMENT OF SHIPBUILDING INDUSTRY ACT 1967.
      Mr. Simon Wingfield Digby: I beg to move, Amendment No. 48, in page 7, line 20, to leave out '£20 million' and to insert '£15 million'.
      We come from supersonic boom to the older, more conventional type of transport, ships, and to shipbuilding. The Clause which this Amendment seeks to amend deals exclusively with shipbuilding. My Amendment would have the effect of reducing by £5 million the amount of grant which can be given to shipbuilding enterprises. I should say at the start that it is not my purpose necessarily to cut this figure back. My purpose is to try to find out what the money is needed for.
      This somewhat unusual Clause is an attempt to substitute a new Section in an Act which was passed only a year ago and to quadruple the amount of grant given for the shipbuilding industry a year ago. An amount of £32½ million was granted for loans to shipbuilding, and £5 million for grants. That £5 million is now to be qaudrupled, after only a year's thought.
      With their usual foresight, of course, the Opposition suggested at the time that the sum of £5 million might not be sufficient. When we did that in Standing Committee we were severely taken to task by the Joint Under-Secretary, who was then Parliamentary Secretary to the Ministry of Technology, who said all kinds of rude things about us. I am glad that, at any rate, he has not been afraid to learn by experience. He talked in Committee on this Bill about a change of judgment. Much less convincing were the reasons he gave in Standing Committee for this very considerable change. Why is it necessary to switch over on such a large scale from loans to grants? Why is it necessary to quadruple them?
      In Committee he gave four reasons for this, and in total I did not find them
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      convincing. The effect of the change made by the Clause, apart from the sum of money involved, is that grouping is no longer to be a condition of the grants. There again, I think, the hon. Gentleman might have learned something at the time of our debates on the original Bill. A former reorganisation will now be sufficient to attract the grant. Also, the time limit goes.
      In justification of this change the hon. Gentleman told the Committee that it would now be necessary, he thought, to prolong the life of the Shipbuilding Industry Board till the end of 1971. Once again I cannot help recalling that we suggested in Committee originally that it might be that they thought the shipbuilding industry could achieve this work very much sooner than was likely to be the case. The main plank in his platform was Harland and Wolff. He referred to the project there of a shallow building dock but failed to specify why it was necessary to increase the sum of the grant by £15 million for that purpose and how much would go for that.
      His third justification was a somewhat naïve one. He said that the international talks about doing away with subsidies in other shipbuilding countries had not borne fruit. It surprised me that in the state of the world as it is today he should think that they ever would. Certainly I agree that our judgment must have changed in the last year with the experience of grouping under the Shipbuilding Industry Board. One of the factors which has made difficulties in reorganisation has been the persistence of very high interest rates.
      Another thing which has arisen, which the hon. Gentleman did not mention, was a certain shortage of capital due to writing down the value of certain existing yards and those yards were having to close. We know from published material that of the loan available under the original Act £5,500,000 has had to be advanced free of interest for one or two years to the Upper Clyde Shipbuilders, but so far as we know there has been no question of a grant to them.
      Perhaps he can tell us if they are to have a grant as well as a loan. This brings me to the whole question of the circumstances in which it is necessary to give ship builders grants rather than loans. What is his philosophy here?

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      We have now reached the stage after about a year's working of the Geddes proposals and of the Shipbuilding Industry Board where it would be very useful to have some kind of progress report of what is being achieved. It is a pity that this matter has to come up at such a late hour. I hope that on another occasion the Government will be able to tell us a little more. There are certain factors which are still disquieting in the situation. For example, the closing of Furness Yard the other day after no less than £5 million had been spent on modernisation. We know of the closing of Barclay Curie's yard on the Upper Clyde and the less expected closing of Stephen's. Orders appear to be coming in well and certain other lessons can be learned already as a result of the reorganisation of the industry. I am surprised that the Government have not stressed the need for vertical co-operation between different groups—and indeed outside the groups—in such matters as design.
      In particular we want to hear from the Under-Secretary how he arrived at the figure of £20 million, why it is in grants and why it cannot come out of the £32,500,000 for loans. I very much hope that he will be able to be specific about this.
      Mr. McMaster: The Joint Under-Secretary of State for Economic Affairs will remember, I am sure, the debates we had on the Shipbuilding Industry Bill. He will remember that we very strongly criticised the amount which he had set aside in the Bill to assist the shipbuilding industry. He adopted the arguments put forward by my hon. Friend the Member for Dorset, West (Mr. Wingfield Digby). He adopted this argument almost in toto, without a word of attribution or gratitude. Nevertheless, we are glad that the Minister has now admitted that the provision in the Shipbuilding Industry Act was not sufficient to meet the requirements of our shipyards.
      11.45 p.m.
      A great deal of the debate in Committee was concerned with the firm of Harland and Wolff, which is in my constituency. It was cited as one of the main masons for advancing £20 million to assist our shipbuilding industry. Part of the money will be used to lay down there one of the biggest building docks in Europe which will be capable of taking
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      boats of up to a million tons. It is very much bigger than anything which is planned today, even in Japan. It will be backed up with new fabrication sheds and other works, and should help to keep the yard in the forefront of world shipbuilding.
      However, there are other factors which are working against the interests of the British shipbuilding industry, and I refer particularly to the short-term. Can the Joint Under-Secretary of State tell us how much of the £20 million is to be advanced to our shipyards in order to tide them over until orders come in for the large tankers and other craft which will be built in these new docks?
      On the Queen's Island, in Belfast, it is feared that there may be severe redundancy between now and the building of the two Esso tankers, and the engine works is where the redundancy is likely to hit first Do the Government intend to spend any of the £20 million, for instance, in assisting Harland and Wolff to develop a new British engine which could be used to keep together the work force in Harland and Wolff until the new facilities come into being?
      Another difficulty facing British yards is the very high rate of interest which has been prevalent in the last two or three years. It makes it almost impossible for British yards to compete against their German, Swedish and Japanese competitors when they have to borrow money at one or two per cent. above Bank Rate, which itself is at an all-time record high and has remained so for a very long period, in spite of many assurances to the contrary from the Government.
      I should like to know why the Government have fixed on the figure of £20 million, and how the entire sum of money is to be spent. I should also like the Minister to say what decisions the Government have reached about the grouping of yards, and which groups the Government intend to survive. I feel that we have been rather stumbling in the measures that we have taken to assist our shipbuilding industry. A master plan is needed, based on the Geddes Report, indicating which of the groups they intend to survive. I include Harland and Wolffe in that, although it does not group conveniently with any of the other yards on the Clyde or Tyne.

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      What assistance is to be given to these groups and what steps are to be taken to rationalise the rest of our shipbuilding industry? I do not intend, at this late hour, to do more than ask these questions of the Minister. I hope that he will answer them, and subject to satisfactory answers, I will not seek to press this Amendment.
      Dame Irene Ward: This Clause is rather wrapped in mystery. It suddenly appeared in the Bill, and up to date we do not appear to have had any satisfactory explanation or information on what this money is required for. I therefore join my hon. Friends in asking the Minister to give a full explanation. I want to know how the money is to be allocated as between parts of the country. I hope the Minister is not unaware of the fact that on Tyneside, in recent months, Swan Hunter and Smith's Dock, which were in the consortium which emerged after the original Shipbuilding Industry Act had been placed on the Statute Book, has had some brilliant successes.
      We on the Tyne are very proud of this, and I hope that the Minister will give approbation to what we have done on the Tyne on a competitive basis. We have heard a lot about the success of Rolls-Royce and I should like to hear about the successes we have had on the Tyne. In many ways the North-East Coast has had less of the public investment for development areas than others. I cannot say what happens in Northern Ireland, but we have had less public investment than Scotland and Wales. I have watched, with great interest, the developments on the Clyde. We think it is in the national interest that shipbuilding should have as much support as possible, whether on the Tyne, the Clyde, in Northern Ireland, on Merseyside, or in other parts of the country.
      We want a good, sound, prosperous and profitable shipbuilding industry, wherever it is based. There have been rumours in my part of the world—and I only toss this off in passing, but Ministers do not always say everything so it is not up to us to give them all the facts—that on the Tyne certain pressures have been brought to bear. We are always apprehensive about this in an industry where we are not keen on
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      Government interference and on their thinking that they know better than experienced men what should be done in the industry.
      I want to know whether this money will be properly used, and whether advice will be tendered not by the Government but by those who know how to build ships.
      Will any of that money be offered to help with the proper development of marine engineering? That is linked with shipbuilding, and we never managed to get real satisfaction from the Minister when were were discussing the Shipbuilding Industry Act in Committee. What is happening to marine engineering? We used to be absolutely supreme in that industry, and the gradual decline in it has been very much regretted on Tyneside. Therefore, I am very glad that my hon. Friend has put down the Amendment, and I look forward to hearing every bit of detail that the Minister can give us.
      I listened to all the debate on the question of advisory committees, the experts, and heaven knows who, who were to advise the Minister on heaven knows what. But I should like to know whether this new proposal has been put forward by the shipbuilders through the Shipbuilding Industry Board. Has it asked for this increase in money, or is it an idea of the Minister with a view to having a little money to spread about, to get more fingers in the pie than he has had in the past?
      I do not want a private enterprise industry which has produced the most magnificent ships and marine engines in the world to get too much mixed up with the Government, because very often the Government have a dead hand. I have noticed that on several occasions when shipbuilding has been raised Ministers have tended to say, "Look what the Government have done for the shipbuilding industry." I say, "Look what the shipbuilding industry has done for the country." It is not our fault that we have gone through very bad times.
      Therefore, I shall be very grateful if the Minister will put all his cards on the table and let us know what is behind the Clause. On what he tells us will depend the decision of my hon. Friend who moved the Amendment, and others of my hon. Friends associated with it, on what they do. Let us know where we

      541
      are and have a real tribute to that great advantage that has emerged from Swan Hunters on the Tyne in their tendering.
      When I was in the North last weekend I found that in spite of the orders we have been able to obtain there are still great anxieties on the Tyne. I should like to know that they can be allayed. I am very glad to have had this opportunity of trying to probe the mystery that the Government have suddenly caused.
      Mr. Albert Booth: I oppose the Amendment. It seems to me that those who have moved and pressed it may, inadvertently I hope, be doing a disservice to the shipbuilding industry. The state of the industry is such that it is, without a shadow of doubt, in need of considerable grant assistance if it is to use the finest technologies and the best equipment which has been developed in some of our research stations it order to capture a wider market for this country and to play a far greater part in building up our exports.
      It falls ill from the lips of any hon. Member opposite to talk about the industry stumbling along without a plan, because it was not until the advent of a Labour Government in 1964 that a proper plan for the industry was introduced.
      12 m.
      My purpose in intervening is to make some inquiries on the point to which the Amendment is directed. I am at present much concerned about the position of Vickers (Barrow), the shipyard in my constituency, and the position of the North-West shipyards in general, as they are at present engaged in talks with a view to amalgamation and the forming of a group. Britain's nuclear submarines are being built in the shipyards of the North-West. If, as it is reasonable to suppose with the present planned defence expenditure, there is to be a curtailment of production of nuclear submarines, we have to consider now what money will be available to make possible the changing of yards from nuclear submarine production to the production of merchant ships.
      The production of nuclear submarines is such a highly specialised business that it is impossible to gear a yard properly in terms of labour and capital to the
      542
      building of nuclear submarines and then change overnight to the building of merchant ships, be they sophisticated bulk carriers, tankers or any other sort of merchant vessel. Will my hon. Friend tell me, therefore, whether the grants envisaged here would be such as to help Vickers (Barrow), in particular, or Cammell Laird so that they could capitalise and reorganise when their nuclear submarine contracts come to an end and go into the production of advanced merchant vessels again?
      In the past, Vickers (Barrow) has proved, by its production of such ships as the "British Admiral", the "Methane Princess" and the "Oriana", that it is capable of building fine merchant vessels, but the berths which produced those ships are today incapable of such production because they have been altered specifically for the production of nuclear submarines. I want an assurance that, with the aid of grants, it will be possible for Vickers (Barrow) and other yards which have been building fine naval vessels to make a major contribution to this country's exports by turning over to merchant ship production.
      Mr. Ridley: Is it still Government policy to continue to subsidise our foreign competitors in the fantastic way we are now doing by means of investment grants? We have just heard that the cost of investment grants for ships built in foreign yards in the next year or two is likely to be £65½ million. Why the British taxpayer should be asked to pay £65½ million to subsidise ships being built abroad beats me. No wonder the British shipbuilding industry is in trouble, and no wonder we have to vote money under the Bill to help it to survive against that competition.
      Is it necessary to pay 25 per cent. of the cost of all ships built abroad, whether for British owners or for foreign owners? We had a debate about this on the Adjournment last night, in which I took part. It seems extraordinary that we have to vote money for subsidising the shipbuilding industry in order to make up the enormous disadvantage under which British shipbuilders are suffering as a result of our profligate expenditure of public money on foreign shipping.
      I do not believe that the Shipbuilding Industry Board, Sir William Swallow, the

      543
      groupings and the investment schemes—all the claptrap which the Minister will tell us about—are worth twopence compared with this vast burden which the Government have put on our industry by making it compete with yards abroad with a 25 per cent. advantage from the taxpayer. The Government might start on sorting out our economic problems and curing our balance of payments problem by stopping a drain of £.65½ million across the exchanges in order to subsidise foreign shipyards building in competition with British shipyards. If they want to carry that further, they might well investigate other aspects of the investment grant system which are doing grievous harm to our industry.
      This is a clear-cut example of the way in which the Government could help the balance of payments, cut Government expenditure and help the British shipbuilding industry. They could deal with all three matters at once if they were prepared to accede to my request. Our struggles with this bogus form of Government interference would end if it were not for the desire to spend this enormous sum of money on subsidising our competitors. I hope that they will answer this point.
      Mr. James Tinn: I wish to draw attention to a practical problem on Teesside which is relevant to our debate. It concerns the Furness shipyard, which is facing closure, involving the loss of the jobs of 3,000 men. It is a very efficient yard and ranks with any in the country, but it has had an unfortunate history and has accumulated considerable losses which have resulted in the present threat to its existence.
      I do not ask my hon. Friend for an assurance that assistance for this shipyard will be forthcoming under the Clause, because the Ministry is very actively considering—and I am a member of the Working Party which is doing it—practical ways in which assistance can be given. This is a practical illustration of a yard which is threatened by special circumstances but the closure of which might be avoided if sufficient funds were forthcoming, ensuring a future for the yard and the people dependent on it for their living.
      Mr. Ted Leadbitter: Not only are the questions which have
      544
      been asked relevant, but it is imperative that an answer should be given to them. It is a matter of alarm that this kind of grant for helping the shipping industry puzzles 3,000 workers on Tees-side in the Furness shipyard. The yard is reputed to be the most modern in the country. It is reputed to have had more new equipment put into it in the past three or four years than any other. In spite of the information which has been conveyed to the House about the discussions which are taking place, the men in the yard have learned only today that a bridging solution has been refused both by the Ministry and the Tyneside consortia.
      I impress upon the Minister that there are angry people on Tees-side and that the Government have a duty to answer, because we cannot see the sense in subsidising shipyards abroad, particularly in Germany, which is increasing its shipbuilding capacity, when there is a modern British shipyard in a modern British port waiting to be utilised. Even during this last week, Tyne concerns have been asking our workers to go there. The Government have a duty to answer these men and to respond to the taxpayers and at least to see that the grant system is used for preferential treatment for our own shipyards and not for those abroad.
      Mr. Dell: The fate of the shipbuilding industry is intimately bound up with Government assistance. There is no question of its fate being separated from the assistance the Government are prepared to give it. The Government have to assist it. This is not a question of the dead hand of Government. The Government are helping to keep the industry alive and are doing so because they believe that it can become competitive and can bring to the country considerable advantages in export orders and in supplying our own shipowners.
      The point raised by the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) is surely not one for this Clause, which relates to the grants to be made under the Shipbuilding Industry Act and is not related to investment grants. He is wrong to suggest that the 25 per cent. grants which are made when British shipowners place orders abroad are differentially in favour of foreign ship builders. The same grants are available when orders are placed in British yards

      545
      and the problem here is the basic problem of the industry—the problem of competitiveness—which it is now at last overcoming.
      If we compelled British shipowners to buy ships in British yards, independently of the ability of those yards to build competitively, we should be doing a disservice to the British fleet. It is essential that, in this situation, our shipbuilders should be competitive with foreign shipbuilders, and this is what we are gradually achieving.
      Mr. Ridley: But as a result we are now in the position where the Japanese Government charge a 15 per cent. import duty on imported ships whereas the British Government pay a 25 per cent. subsidy on imported ships. This cannot make sense. Will the hon. Gentleman book at it again?
      Mr. Dell: I am aware of the situation in Japan in relation to the protection given to Japanese shipbuilders, which results in practically 100 per cent.—if not actually 100 per cent.—of Japanese ships being built in Japanese yards. The main point at the moment is that there is no discrimination in the investment grant system against British yards. If they are competitive, they can get the orders. Moreover, there is the further point that British yards have depended for far too long on the British fleet for their orders.
      We want to see a far greater proportion of the ships built in British yards going for export and one of the welcome aspects about the number of orders coming to our yards is that so many of them are for export.
      I am sorry that some hon. Members have expressed dissatisfaction with the explanation I gave in Committee about the change in the amount of money provided under Section 3 of the Shipbuilding Industry Act. I do so because I was assured in Committee that, if my explanation were satisfactory, an Amendment which had been moved would not be pressed to a division. The Amendment was not pressed and I therefore took it that the Opposition in Committee were satisfied with my explanation. But apparently some other hon. Members opposite were not. There were new facts on which it was reasonable for the Gov
      546
      ernment to base a change of judgment as to the amount of money which should be supplied by means of grant. The hon. Member for Eastleigh (Mr. David Price) said this explicitly in Committee and I was grateful to him. He said:
      "I believe that we can now see the future with rather more clarity than the Geddes Committee could, because it started its work over three years ago, and with even greater clarity than we in the House and the appropriate Standing Committee could a year ago when we were debating the Shipbuilding Industry Bill."—[OFFICIAL, REPORT, Standing Committee E, 12th March, 1968; c. 338.]
      I think he is right. This justifies the change in judgment which we have made as to the amount of money to be provided by grant, and it is a fortunate fact that we have this Bill which enables us to make this change.
      12.15 a.m.
      This is one of the general arguments for the Industrial Expansion Bill, that it enables changes of judgment, made necessary by the availability of new facts in industrial situations, and in relationships between Government and industry, to be put into effect, not by passing Acts of Parliament but by introducing Statutory Orders—on a time scale which is far more appropriate to the problems between Government and industry.
      Mr. Wingfield Digby: Does not the hon. Gentleman recall that we made this very point in Committee, that we did not think that the £5 million would be enough? He poured scorn on our idea.
      Mr. Dell: No, the hon. Gentleman is wrong in suggesting that I poured scorn on it. On the contrary, with my usual care, I considered the arguments advanced, and I based the judgment that the Government were taking on the Report of the Geddes Committee. Now, as the hon. Member for Eastleigh assures us, there are new facts. One is the considerable rise in the demand for large tankers, which has followed the closing of the Suez Canal and which post-dated the consideration of the Shipbuilding Industry Act last year. I do not say that this trend would not have emerged in any case, but it has certainly been speeded up considerably by the closing of the Suez Canal.
      The changes that we are making are of three main types. We are making it

      547
      possible to give grants, not just to shipbuilding groups as was the case under the original Act, but also to "non-groups." We are making it possible to give grants in cases other than of transitional losses; and we are increasing the sum of money involved.
      I do not want to go over all the arguments that I presented in Committee in considerable detail to explain all these changes. I want to devote most of my time now to answering specific questions that I have been asked. However, perhaps I may make these points in brief. The main "non-group" with which we are concerned is Harland and Wolff because of the demand which is emerging for large tankers—not just the Esso tankers although we are glad that firm got the order for them, and we are equally glad that Swan Hunter got an order—but for future large tankers. This will enable us to assist by grants in the provision of a shipbuilding dock in the Musgrave Channel.
      It is important that the industry should understand that the fact that we are now allowing grants to be made available to "non-groups"—to single firms like Harland and Wolff, although I agree that it is a very big single firm—does not mean that the Shipbuilding Industry Board intends to let up in any way the pressure which it is exerting to establish groupings throughout the shipbuilding industry. This pressure will be maintained.
      I was asked what groups we thought would survive. All the groups which the Shipbuilding Industry Board is helping to bring into existence will we hope survive. We hope there will be a further group on the Wear. We hope that the present stage of grouping will be only a first stage and that there will be further groupings. We would like to see one group on the Clyde and probably one group in the North-East. We would also like to see the emergence of a North West group. It would be wrong to imagine that Harland and Wolff would not derive considerable advantages from joining a North-West group.
      Dame Irene Ward: Concerning the dock to which the hon. Gentleman referred for Harland and Wolff, may I ask whether we should be able to get a grant from this source for the new dock
      548
      which we want to build on the Tyne so that we can take the big tankers? We are in great difficulty as regards the Tyne and I should like to know whether we can have some of this grant, because the Tyne Improvement Commission says that it cannot go any further until it knows what our future is to be.
      Mr. Dell: It is a matter for the Swan Hunter and Tyne Group to make an application. The hon. Lady asked me about the position of the Tyne Group in relation to the Clause. She complained that insufficient assistance had been given to that group as a result of the passage of the Shipbuilding Industry Act. That is quite incorrect.
      It is open to the Swan Hunter and Tyne Group—as it is to other groups—to make applications, for example, for grants to assist the building of docks, or for loans. Whatever they think is appropriate, can be applied for, and would be considered by the Shipbuilding Industry Board.
      Dame Irene Ward: The hon. Gentleman has got me wrong. I did not say that. I said that public investment, which means public investment in total from the Government, to the North-East Coast has been less than it has been to Scotland and Wales. This is public investment in total. That is why I am anxious to know whether we are able to have this additional money for our dock, because we have got less than anybody else in total—not through the Shipbuilding Industry Board at all.
      Mr. Dell: That is a much wider question. I am sure that Mr. Deputy Speaker would rule me out of order if I went into it. On the specifically shipbuilding point, it is entirely open to the Swan Hunter and Tyne Group to make applications for assistance under the Act to the Shipbuilding Industry Board, and the applications would be considered in the ordinary way.
      Mr. Booth: Since my hon. Friend has remarked on the advantage which he sees in Harland and Wolff becoming a member of a North-West group, and since Vickers, Barrow, is similar in terms of geographic isolation, would he give his view on the advantage of Vickers, Barrow, also becoming a member of the North-West group?
      Mr. Dell: That is a matter which the Shipbuilding Industry Board would have to consider. My hon. Friend asked me specifically whether grants could be made available to the Vickers yard at Barrow—or, indeed, to Cammell Laird, in my constituency—to assist in any reorganisation which is required to make it able to supply merchant ships (at the moment the yard is concentrating on naval production). The answer is, of course "Yes". It is possible under the Clause—especially as rewritten because it is not new tied to grouping—for an application to be made. Nevertheless, I must re-emphasise my earlier point that the Shipbuilding Industry Board will keep up the pressure which it has already exerted to achieve groupings in the shipbuilding industry so that the industry can become more competitive and viable.
      The second change between the original Clause and the Clause as we now have it is that it now enables grants to be made in cases other than transitional losses. The original concept was that there would be certain facilities, in yards which would be grouped, which would remain useful when the grouping had been carried through, but which might not be capable of being used during the process of grouping. This situation was described in the Geddes Report as "transitional losses", and grants were to be made to assist yards in the course of grouping to meet those transitional losses.
      The idea now is that grants should be available to yards in other cases as well to assist those parts of the shipbuilding industry which have a longterm future and can become competitive to survive in what is for the moment—temporarily, we hope—a weak financial position. It is important that they survive because of the great advantage which successful and competitive shipbuilding yards have in helping our balance of payments.
      Mr. Leadbitter: Do those conditions apply to the Furness shipbuilding yard?
      Mr. Dell: Perhaps my hon. Friend will wait until I deal with the Furness yard. My hon. Friend the Member for Cleveland (Mr. Tinn) asked specific questions about the Furness yard, and it might be as well to deal with this matter as a whole.
      550
      I explained in Committee why it has become necessary to increase the £5 million to £20 million. I have now been asked by the hon. Member for Dorset, West (Mr. Wingfield Digby) how much of this additional grant money will go to help the reorganisation of Harland and Wolff to equip it to build large tankers. I cannot yet give that figure. It is still under discussion, but this information will be available in the annual publications of the Shipbuilding Industry Board.
      The hon. Gentleman also accused me of naivety in ever believing that the international discussions of subsidies would ever achieve success. We had interesting discussions on this subject last year. That accusation was a little unfortunate. We all had our doubts about it, but it is important when entering these negotiations to have some hope that something will be achieved. Nevertheless, it is reasonable for the Government to have a fall-back position. We would have to consider the situation of our shipbuilding industry if it proved impossible to eliminate the sort of practices which the hon. Member for Cirencester and Tewkesbury mentioned—the subsidisation of other shipbuilding industries and their protection by their own governments. If it proves impossible to eliminate these practices, naturally the Government will have to consider the implications for our own shipbuilding industry.
      The hon. Member for Dorset, West asked why there should be this sum of £20 million for grants and why what was required could not be done under the provisions of Section 4 of the original Act and the £32½ million for loans. We have to consider what is appropriate for loans and what for grants. If all the groups which we anticipate come into existence, the whole of the £32½ million will be absorbed. Our objectives under these provisions require assistance by way of grant, not loan.
      I was asked whether any grants would be made available to the Upper Clyde Shipbuilding Group, which has recently come into existence. I cannot answer that at this time, for the simple reason that no submission has been made by the U.C.S.G. for such grant. If such a submission is made, it will, of course, be considered by the Shipbuilding Industry Board. I have to give the same answer

      551
      about marine engines, and marine engines at Harland and Wolff about which the hon. Member' for Belfast, East (Mr. McMaster) asked. If applications are made, they will be considered. The Shipbuilding Industry Board is considering the whole situation of the marine engine industry in this country.
      I was asked by my hon. Friends the Member for Cleveland and the Member for The Hartlepools (Mr. Leadbitter) about the closure of the Furness yard. They will know that a working party has been set up under my hon. Friend the Joint Parliamentary Secretary to the Ministry of Technology and that the trade unions and others are participating. It is currently engaged on making an economic appraisal of the possible future of the yard and in due course it will submit a report. It is essential that the yard should have a possible economically successful future if it is to be given assistance under the Bill.
      I was asked whether the additional grants to be made available under the amended Clause had been decided in consultation with the Shipbuilding Industry Board. The answer is that the Board has been fully consulted in this matter and we have its approval.
      12.30 a.m.
      I think that we are now in a rather happier state with the shipbuilding industry than we were a year ago when we were considering the Bill. Recently there have been encouraging signs that the combination of greater efficiency resulting from grouping, and greater competitiveness resulting from devaluation, have brought more and more orders, including export orders, to the industry. This trend is very welcome, and I think it justifies the attention given to, and the planning done for this industry by the Government in the Shipbuilding Industry Act of last year. It is a trend which will be continued if the House accepts this amended Clause.
      Mr. Wingfield Digby: I thank the hon. Gentleman for that reply, and I applaud some of the purposes which he has outlined for these grants, such as the project for Harland and Wolff. There is, how-over, some lingering doubt in my mind about whether he will use these grants as a kind of carrot to bring about unneces
      552
      sary mergers, or the unnecessary closure of specialised yards, but in view of the assurances that he has given me, I beg to ask leave to withdraw the Amendment.
      Amendment, by leave, withdrawn.

    Schedule 2.

      INDUSTRY BOARDS.
      Mr. Peyton: I beg to move Amendment No. 55, in page 10, line 14, leave out from "shall" to "and" in line 15 and insert:
      'shall publish the fact in the London Gazette".
      The Amendment requires some more formality than is at present provided in the Schedule, which reads:
      "…and shall notify the fact in such manner as the authority thinks fit; and thereupon the office shall become vacant."
      In my submission, and I hope that the House will accept this, when an official vacancy occurs it should not be notified in this sloppy way, "as the authority think fit", but should be done formally, so that everybody knows exactly when the office becomes vacant.
      I do not wish to delay the House at this time of the night on what is a comparatively small point, but I believe this sort of sloppiness to be characteristic of the Bill, and I hope that the Minister will take the opportunity afforded by the Amendment to put it right.
      Mr. Dell: I do not think that there is any question of sloppiness here. If the competent authority is satisfied, for the various reasons given, that a member should not continue as a member, the office will become vacant, and the fact will be notified in the proper way. Everyone will know that the office has become vacant, and we do not see any reason why there should be a specific legislative requirement of this sort. This Schedule is in the ordinary form of Schedules of this sort. It is not a normal requirement that this information should be published in the London Gazette, and I think that the House should be content with the wording as it is.
      Mr. Peyton: I am not content with this. I do not want to be fussy or pedantic, but if that is the best the hon. Gentleman can do, I am sorry, and I hope very

      553
      much that my hon. Friends will show their dissatisfaction with that kind of answer, and that we will express it in the only way open to us, in the Division Lobbies.
      Question put, That the Amendment be made:—
      The House divided: Ayes 123, Noes 153.

      Division No. 108.]

      AYES

      [12.35 a.m.

      Alison, Michael (Barkston Ash)

      Goodhart, Philip

      Onslow, Cranley

      Astor, John

      Goodhew, Victor

      Orr, Capt. L. P. S.

      Awdry, Daniel

      Gower, Raymond

      Osborn, John (Hallam)

      Baker, K. W. (Acton)

      Grant, Anthony

      Percival, Ian

      Bilker, W. H. K. (Banff)

      Gresham Cooke, R.

      Peyton, John

      Balniel, Lord

      Griffiths, Eldon (Bury St. Edmunds)

      Pink, R. Bonner

      Beamish, Col. Sir Tufton

      Halt-Davis, A. G. F.

      Price, David (Eastleigh)

      Biggs-Davison, John

      Harrison, Col. Sir Harwood (Eye)

      Pym, Francis

      Black, Sir Cyril

      Hawkins, Paul

      Quennell, Miss J. M.

      Blaker, Peter

      Higgins, Terence L.

      Ramsden, Rt. Hn. James

      Boardman, Tom

      Hiley, Joseph

      Rhys Williams, Sir Brandon

      Boyd-Carpenter, Rt. Hn. John

      Hill, J. E. B.

      Ridley, Hn. Nicholas

      Brinton, Sir Tatton

      Holland, Philip

      Rossi, Hugh (Hornsey)

      Brown, Sir Edward (Bath)

      Hordem, Peter

      Royle, Anthony

      Bryan, Paul

      Hornby, Richard

      Russell, Sir Ronald

      Buchanan-Smith. Alick (Angus, N & M)

      Howell, David (Guildford)

      Scott, Nicholas

      Buck, Antony (Colchester)

      Hunt, John

      Scott-Hopkins, James

      Carr, Rt. Hn. Robert

      Jenkin, Patrick (Woodford)

      Sharpies, Richard

      Channon, H. P. G.

      Jopling, Michael

      Sinclair, Sir George

      Chichester-Clark, R.

      Kershaw, Anthony

      Stainton, Keith

      Corfield, F. V.

      King, Evelyn (Dorset, S.)

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

      Costain, A. P.

      Kirk, Peter

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

      Crouch, David

      Kitson, Timothy

      Taylor, Frank (Moss Side)

      Crowder, F. P.

      Knight, Mrs. Jill

      Temple, John M.

      Dalkeith, Earl of

      Lane, David

      Thatcher, Mrs. Margaret

      Dance, James

      Langford-Holt, Sir John

      Turton, Rt. Hn. R. H.

      Dean, Paul (Somerset, N.)

      MacArthur, Ian

      van Straubenzee, W. R.

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

      Maclean, Sir Fitzroy

      Wall, Patrick

      Digby, Simon Wingfield

      McMaster, Stanley

      Ward, Dame Irene

      Doughty, Charles

      Maddan, Martin

      Weatherill, Bernard

      du Cann, Rt. Hn. Edward

      Maginnis, John E.

      Webster, David

      Eden, Sir John

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

      Wells, John (Maidstone)

      Elliot, Capt. Walter (Carshalton)

      Mills, Peter (Torrington)

      Whitelaw, Rt. Hn. William

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

      Mills, Stratton (Belfast, N.)

      Williams, W. D. (Dudley)

      Emery, Peter

      Mitchell, David (Basingstoke)

      Wilson, Geoffrey (Truro)

      Farr, John

      Monro, Hector

      Wolrige-Gordon, Patrick

      Fisher, Nigel

      Montgomery, Fergus

      Worsley, Marcus

      Fletcher-Cooke, Charles

      Murton, Oscar

      Wright, Esmond

      Fortescue, Tim

      Neave, Airey

      Wylie, N. R.

      Foster, Sir John

      Nicholls, Sir Harmar

      Gibson-Watt, David

      Noble, Rt. Hn. Michael

      TELLERS FOR THE AYES:

      Godber, Rt. Hn. J. B.

      Nott, John

      Mr. Jasper More and

      Mr. Reginald Eyre.

      NOES

      Allaun, Frank (Salford, E.)

      Davies, Dr. Ernest (Stretford)

      Hamling, William

      Alldritt, Walter

      Davies, G. Elfed (Rhondda, E.)

      Harper, Joseph

      Allen, Scholefield

      Dell, Edmund

      Harrison, Walter (Wakefield)

      Anderson, Donald

      Dewar, Donald

      Haseldine, Norman

      Archer, Peter

      Dickens, James

      Hattersley, Roy

      Atkinson, Norman (Tottenham)

      Dobson, Ray

      Hazell, Bert

      Bagier, Gordon A. T.

      Doig, Peter

      Henig, Stanley

      Barnett, Joel

      Dunn, James A.

      Hooley, Frank

      Benn, Rt. Hn. Anthony Wedgwood

      Dunwoody, Mrs, Gwyneth (Exeter)

      Homer, John

      Binns, John

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

      Howarth, Robert (Bolton, E.)

      Bishop, E. S.

      Eadie, Alex

      Hoy, James

      Blenkinsop, Arthur

      Ellis, John

      Huckfield, Leslie

      Booth, Albert

      Ennals, David

      Hughes, Roy (Newport)

      Boyden, James

      Ensor, David

      Hunter, Adam

      Bray, Dr. Jeremy

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

      Hynd, John

      Brooks, Edwin

      Faulds, Andrew

      Irvine, Sir Arthur

      Buchan, Norman

      Fletcher, Raymond (Ilkeston)

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

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

      Foot, Michael (Ebbw Vale)

      Jackson, Peter M. (High Peak)

      Carmichael, Neil

      Ford, Ben

      Jenkins, Hugh (Putney)

      Carter-Jones, Lewis

      Fowler, Gerry

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

      Coleman, Donald

      Freeson, Reginald

      Johnston, Russell (Inverness)

      Concannon, J. D.

      Garrett, W. E.

      Jones, J. Idwal (Wrexham)

      Crawshaw, Richard

      Gourtay, Harry

      Jones, T. Alec (Rhondda, West)

      Crossman, Rt. Hn. Richard

      Gregory, Arnold

      Kerr, Dr. David (W'worth, Central)

      Cullen, Mrs. Alice

      Grey, Charles (Durham)

      Lawson, George

      Davidson, Arthur (Accrington)

      Griffiths, David (Rother Valley)

      Leadbitter, Ted

      Davidson, James (Aberdeenshire, W.)

      Griffiths, Will (Exchange)

      Ledger, Ron

      Hamilton, James (Bothwell)

      Lee, John (Reading)

      Lestor, Miss Joan

      Milne, Edward (Blyth)

      Slater, Joseph

      Lewis, Ron (Carlisle)

      Mitchell, R. C. (S'th'pton, Test)

      Spriggs, Leslie

      Loughlin, Charles

      Morgan, Elystan (Cardiganshire)

      Steel, David (Roxburgh)

      Lubbock, Eric

      Morris, Charles R. (Openshaw)

      Swain, Thomas

      Lyon, Alexander W. (York)

      Newens, Stan

      Tinn, James

      Lyons, Edward (Bradford, E.)

      O'Malley, Brian

      Wainwright, Edwin (Dearne Valley)

      McBride, Neil

      Orme, Stanley

      Wainwright, Richard (Colne Valley)

      McCann, John

      Oswald, Thomas

      Wallace, George

      MacColl, James

      Owen, Will (Morpeth)

      Watkins, David (Consett)

      Macdonald, A. H.

      Page, Derek (King's Lynn)

      Watkins, Tudor (Brecon & Radnor)

      McGuire, Michael

      Palmer, Arthur

      Wellbeloved, James

      Mackenzie, Gregor (Rutherglen)

      Parkyn, Brian (Bedford)

      Wells, William (Walsall, N.)

      McMillan, Tom (Glasgow, C.)

      Pavitt, Laurence

      Whitaker, Ben

      MacPherson, Malcolm

      Pentland, Norman

      Whitlock, William

      Mahon, Simon (Bootle)

      Perry, Ernest G. (Battersea, S.)

      Williams, Clifford (Abertillery)

      Mallalieu, E. L. (Brigg)

      Perry, George H. (Nottingham, S.)

      Willis, Rt. Hn. George

      Manuel, Archie

      Price, William (Rugby)

      Winstanley, Dr. M. P.

      Mapp, Charles

      Probert, Arthur

      Woodburn, Rt. Hn. A.

      Marks, Kenneth

      Rees, Merlyn

      Woof, Robert

      Marquand, David

      Roberts, Albert (Normanton)

      Yates, Victor

      Maxwell, Robert

      Robertson, John (Paisley)

      Mayhew, Christopher

      Rose, Paul

      TELLERS FOR THE NOES:

      Mendelson, J. J.

      Ryan, John

      Mr. Eric G. Varley and

      Millan, Bruce

      Silkin, Rt. Hn. John (Deptford)

      Mr. Harold Walker.

      Miller, Dr. M. S.

      Silverman, Julius (Aston)

      Mr. Peyton: I beg to move Amendment No. 56, in page 10, line 28, leave out from 'as' to 'and' in line 29 and insert 'may be approved by Parliament'.
      Mr. Speaker: It might be for the convenience of the House to take with this Amendment 57, in page 10, line 29, leave out from 'determine' to end of line 33.
      Mr. Peyton: I am concerned with what is in the Government's mind on this point. Paragraph (9) provides:
      "The Board shall pay to its members such salaries or fees and such allowances as the competent authority with the approval of the Treasury may determine;".
      I want to substitute,
      "may be approved by Parliament".
      12.45 a.m.
      I would not wish to press this Amendment upon the Government. I am simply asking them to give some guidance as to what they have in mind as to the level of salaries for members of these advisory boards, and whether they will be part time or full time. If whoever is to reply can give the House just rough guidance on this point I shall be perfectly prepared to ask leave to withdraw the Amendment, but I hope that I am not asking for too much in putting forward what I regard as a very modest demand indeed.
      Mr. Dell: It is not possible to give the hon. Gentleman an answer to that question, for the simple reason that the boards which will be set up under this Bill will be of very different types, dealing with problems of very different natures, requiring in certain cases, perhaps, people devoting most of their time to them; in
      other cases devoting only a very small part of their time to them. There will be a series of circumstances, and each of these circumstances will have to be judged on its merits.
      Mr. Peyton: If I may, by leave of the House, I would say to the Joint Under-Secretary, without wishing to be offensive at all, that I regard that answer as totally inadequate. The provision is that the board shall pay such salaries or fees
      "as the competent authority with the approval of the Treasury may determine".
      As the "competent authority" is the Minister—at any rate, he is one of the so-called "competent authorities"—and as the Treasury is the only other party involved, it would seem to me to be far from impossible for the Government just to go so far as to give the House some rough guidance as to what they mean. I myself distinguish between a full-time and a part-time member. If the Joint Under-Secretary cannot get up now and say something a little clearer than what he said just now, I with regret, because I do not wish to waste time, shall certainly ask my hon. Friends to go into the Lobby.
      Mr. Dell: I do not know that that language is very appropriate from an hon. Member who was not even in the House to move one of his own Amendments. The fact is that the salaries payable under this Schedule will be paid for out of Vote, and will be subject to Parliamentary approval in the ordinary way. Paragraph 12 of the Schedule lays it down that these sums will be made known to the House so that all the facts of the situation will be known. It is

      557
      a quite impossible and unreasonable request to make to the Minister that at this stage he should give a blanket answer to a question which in practical fact will have to be answered in a series of specific circumstances, each of them possibly different. Exactly this wording was used in the Shipbuilding Industry Act, and also in the Industrial Reorganisation Corporation Act, leaving it open, subject, as I have indicated, to the control of Parliamentary approval of a Vote, and to the House to decide whether the salaries are appropriate in the case of he boards set up under the Bill.
      Mr. David Price: The Joint Parliamentary Secretary could have done a little better than that. My hon. Friend
      was not asking for a precise figure in every case. He wanted some idea of the order of the salaries and allowances. He asked specifically whether the Government envisaged that these gentlemen would be serving part time or full time. That was a very proper question to ask. It is getting rather late and the hon. Gentleman may be feeling tired, but his attack on my hon. Friend about an Amendment which he did or did not move was uncalled for. My hon. Friend would be absolutely right to press this matter to a Division.
      Question put, That the Amendment be made:—
      The House divided: Ayes 127, Noes 146.

      Division No. 109.]

      AYES

      [12.50 a.m.

      Alison, Michael (Barkston Ash)

      Goodhew, Victor

      Orr, Capt. L. P. S.

      Astor, John

      Gower, Raymond

      Osborn, John (Hallam)

      Awdry, Daniel

      Grant, Anthony

      Percival, Ian

      Baker, K. W. (Acton)

      Gresham Cooke, R.

      Peyton, John

      Baker, W. H. K. (Banff)

      Griffiths, Eldon (Bury St. Edmunds)

      Pink, R. Bonner

      Balniel, Lord

      Hall-Davis, A. G. F.

      Price, David (Eastleigh)

      Beamish, Col. Sir Tufton

      Harrison, Col. Sir Harwood (Eye)

      Pym, Francis

      Biggs-Davison, John

      Hawkins, Paul

      Quennell, Miss J. M.

      Black, Sir Cyril

      Higgins, Terence L.

      Ramsden, Rt. Hn. James

      Blaker, Peter

      Hiley, Joseph

      Rhys Williams, Sir Brandon

      Boardman, Tom

      Hill, J. E. B.

      Ridley, Hn. Nicholas

      Boyd-Carpenter, Rt. Hn. John

      Holland, Philip

      Rossi, Hugh (Hornsey)

      Brinton, Sir Tatton

      Hordern, Peter

      Royle, Anthony

      Brown, Sir Edward (Bath)

      Hornby. Richard

      Russell, Sir Ronald

      Bryan, Paul

      Howell, David (Guildford)

      Scott, Nicholas

      Buchanan- Smith, Alick (Angus, N&M)

      Hunt, John

      Scott-Hopkins, James

      Buck, Antony (Colchester)

      Jenkin, Patrick (Woodford)

      Sharpies, Richard

      Carr, Rt. Hn. Robert

      Johnston, Russell (Inverness)

      Sinclair, Sir George

      Channon, H. P. G.

      Jopling, Michael

      Stainton, Keith

      Chichester-Clark, R.

      Kershaw, Anthony

      Steel, David (Roxburgh)

      Corfield, F. V.

      King, Evelyn (Dorset, S.)

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

      Costain, A. P.

      Kirk, Peter

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

      Crouch, David

      Kitson, Timothy

      Taylor, Frank (Moss Side)

      Crowder, F. P.

      Knight, Mrs. Jill

      Temple, John M.

      Dalkeith, Earl of

      Lane, David

      Thatcher, Mrs. Margaret

      Dance, James

      Langford-Holt, Sir John

      Turton, Rt. Hn. R. H.

      Davidson, James (Aberdeenshire, W.)

      Lubbock, Eric

      van Straubenzee, W. R.

      Dean, Paul (Somerset, N.)

      MacArthur, Ian

      Wall, Patrick

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

      Maclean, Sir Fitzroy

      Ward, Dame Irene

      Digby, Simon Wingfield

      McMaster, Stanley

      Webster, David

      Doughty, Charles

      Maddan, Martin

      Wells, John (Maidstone)

      du Cann, Rt. Hn. Edward

      Maginnis, John E.

      Whitelaw, Rt. Hn. William

      Eden, Sir John

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

      Williams, w. D. (Dudley)

      Elliot, Capt. Walter (Carshalton)

      Mills, Peter (Torrington)

      Wilson, Geoffrey (Truro)

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

      Mills, Stratton (Belfast, N.)

      Winstanley, Dr. M. P.

      Emery, Peter

      Mitchell, David (Basingstoke)

      Wolrige-Gordon, Patrick

      Farr, John

      Monro, Hector

      Worsley, Marcus

      Fisher, Nigel

      Montgomery, Fergus

      Wright, Esmond

      Fletcher-Cooke, Charles

      More, Jasper

      Wylie, N. R.

      Fortescue, Tim

      Murton, Oscar

      Foster, Sir John

      Neave, Airey

      TELLERS FOR THE AYES:

      Gibson-Watt, David

      Noble, Rt. Hn. Michael

      Mr. Reginald Eyre and

      Godber, Rt. Hn. J. B.

      Nott, John

      Mr. Bernard Weatherill.

      Goodhart, Philip

      Onslow, Cranley

      NOES

      Allaun, Frank (Salford, E.)

      Bagier, Gordon A. T.

      Booth, Albert

      Alldritt, Walter

      Barnett, Joel

      Boyden, James

      Allen, Scholefield

      Bonn, Rt. Hn. Anthony Wedgwood

      Bray, Dr. Jeremy

      Anderson, Donald

      Binns, John

      Brooks, Edwin

      Archer, Peter

      Bishop, E. S.

      Buchan, Norman

      Atkinson, Norman (Tottenham)

      Blenkinsop, Arthur

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

      Carmichael, Neil

      Hooley, Frank

      Morgan, Elystan (Cardiganshire)

      Carter-Jones, Lewis

      Horner, John

      Morris, Charles R. (Openshaw)

      Coleman, Donald

      Howarth, Robert (Bolton, E.)

      Newens, Stan

      Concannon, J. D.

      Hoy, James

      O'Malley, Brian

      Crawshaw, Richard

      Huckfield, Leslie

      Orme, Stanley

      Crossman, Rt. Hn. Richard

      Hughes, Roy (Newport)

      Oswald, Thomas

      Cutten, Mrs. Alice

      Hunter, Adam

      Owen, Will (Morpeth)

      Davidson, Arthur (Accrington)

      Hynd, John

      Page, Derek (King's Lynn)

      Davies, Dr. Ernest (Stretford)

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

      Palmer, Arthur

      Davies, G. Elfed (Rhondda, E.)

      Jackson, Peter M. (High Peak)

      Parkyn, Brian (Bedford)

      Dell, Edmund

      Jenkins, Hugh (Putney)

      Pavitt, Laurence

      Dewar, Donald

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

      Pentland, Norman

      Dickens, James

      Jones, J. Idwal (Wrexham)

      Perry, Ernest G. (Battersea, S.)

      Dobson, Ray

      Jones, T. Alec (Rhondda, West)

      Perry, George H. (Nottingham, S.)

      Doig, Peter

      Kerr, Dr. David (W'worth, Central)

      Price, William (Rugby)

      Dunn, James A.

      Lawson, George

      Probert, Arthur

      Dunwoody, Mrs. Cwyneth (Exeter)

      Leadbitter, Ted

      Rees, Merlyn

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

      Ledger, Ron

      Roberts, Albert (Normanton)

      Eadie, Alex

      Lee, John (Reading)

      Robertson, John (Paisley)

      Edwards, William (Merioneth)

      Lestor, Miss Joan

      Rose, Paul

      Ellis, John

      Lewis, Ron (Carlisle)

      Ryan, John

      Ennals, David

      Loughlin, Charles

      Silkin, Rt. Hn. John (Deptford)

      Ensor, David

      Lyon, Alexander W. (York)

      Slater, Joseph

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

      Lyons, Edward (Bradford, E.)

      Spriggs, Leslie

      Faulds, Andrew

      McBride, Neil

      Swain, Thomas

      Fletcher, Raymond (Ilkeston)

      McCann, John

      Tinn, James

      Foot, Michael (Ebbw Vale)

      MacColl, James

      Urwin, T. W.

      Ford, Ben

      Macdonald, A. H.

      Wainwright, Edwin (Dearne Valley)

      Fowler, Gerry

      McGuire, Michael

      Wallace, George

      Freeson, Reginald

      Mackenzie, Gregor (Rutherglen)

      Watkins, David (Consett)

      Garrett, W. E.

      McMillan, Tom (Glasgow, C.)

      Watkins, Tudor (Brecon A Radnor)

      Gourlay, Harry

      MacPherson, Malcolm

      Wellbeloved, James

      Gregory, Arnold

      Mahon, Simon (Boone)

      Wells, William (Walsall, N.)

      Grey, Charles (Durham)

      Mallalieu, E. L. (Brigg)

      Whitaker, Ben

      Griffiths, David (Rother Valley)

      Manuel, Archie

      Whitlock, William

      Griffiths, Will (Exchange)

      Mapp, Charles

      Williams, Clifford (Aberillery)

      Hamilton, James (Bothwell)

      Marks, Kenneth

      Willis, Rt. Hn, George

      Hamling, William

      Marquand, David

      Woodburn, Rt. Hn. A.

      Harper, Joseph

      Maxwell, Robert

      Woof, Robert

      Harrison, Walter (Wakefield)

      Mayhew, Christopher

      Yates, Victor

      Haseldine, Norman

      Mendelson, J. J.

      TELLERS FOR THE NOES:

      Hattersley, Roy

      Millan, Bruce

      Mr. Eric G. Varley and

      Hazelt, Bert

      Miller, Dr. M. S.

      Mr. Harold Walker.

      Henig, Stanley

      Mitchell, R. C. (S'th'pton, Test)

      Mr. Peyton: I beg to move Amendment No. 58, in page 10, line 34, leave out paragraph 10.
      Mr. Speaker: With this Amendment, we are taking Amendment No. 59 in line 43, at end insert:
      Provided that in no case shall the amount exceed £5,000.
      1.0 a.m.
      Mr. Peyton: This is an exploratory Amendment and I intend to move it with brevity, if I am given a chance, and in as conciliatory a manner as possible. This may be thought foolish in view of the rude reward I met with last time. I am not asking for a decision, but merely whether the responsible Minister will give the House rough guidance on the Government's thoughts. What pension levels are to be paid? If the Parliamentary Secretary cares to explain what is intended by way of gratuities, I should be mildly interested in that as well. Perhaps he would like to explain what "gratuities" mean in this context. I hope he will give a much better answer
      than he did last time. It should not be beyond his capacity.
      Mr. Dell: I thank the hon. Gentleman for his reference to my capacity. I hope we can now make peace. It is unlikely that these Boards will last long enough for their members to qualify for pensions as members of them—[Interruption]—hon. Members make the appropriate noises that we expect. Taking the Shipbuilding Industry Board as an example, it started in 1967 and expires in 1970 or 1971. That is normal. Other boards may be set up for varying periods to do jobs, but these are unlikely to be the sort of periods which would mean a person qualifying for pension in respect of his service with the Board. Nevertheless, the Board may wish to make a contribution to his existing pension fund, to help sustain the pension entitlement of a member of the Board. This Clause is intended to do no more than that.
      Once more, it is in the form of the same type of provision in the Shipbuilding Industry Act and the Industrial Reorganisation Corporation Act.

      561
      As for the provision in respect of compensation to a member, it is unlikely that any large sums will be involved. This also is in the form in which it appears in the two Acts I have already mentioned. In this case, any sum paid would be subject to Parliamentary approval at the time it was decided, and the House would therefore have complete control over the matter and could reject any sum proposed to be paid in this respect. I hope, with this explanation, that the hon. Member for Yeovil (Mr. Peyton) will withdraw his Amendment.
      Mr. Peyton: I appreciate the marked advance that that reply showed on the previous one. Therefore, I beg to ask leave to withdraw the Amendment.
      Amendment, by leave, withdrawn.

    Schedule 3.

      AMENDMENTS OF MINISTRY OF SUPPLY ACT 1939.
      Mr. Peyton: I beg to move Amendment No. 61, in page 12, line 6, leave out from 'service' to 'to' in line 7.
      The Amendment would remove the words
      …or articles to he exchanged for such articles…"
      I thought that I heard a gasp of astonishment from hon. Members opposite. I can well understand that, because if they have not read the Schedule before they might well find the presence of such words astonishing and amazing. It is a question on which the right hon. Member for Edinburgh, East (Mr. Willis) should be able to beguile the House for a considerable period, and I am sorry th it we cannot tempt him.
      As I understand it, the presence of the words would enable the Minister to engage in barter. I cannot for the life of me see why he should want to do that in the context of the Bill. It has conferred many powers on the Minister of Technology in particular, and those other people who obviously relish the
      euphemism of "competent authorities" under the Bill. Now, in addition, somebody has apparently been struck by the need for this quite unthought of one and decided that it had better be stuck in because it might be necessary. I hope that the Parliamentary Secretary can announce in flawless English that it is his intention that these ugly words should be withdrawn from the Bill, because that would greatly add to the harmony of our proceedings.
      Dr. Bray: I am always anxious to do anything that would add to harmony, but I regret that I shall have to disappoint the hon. Gentleman in this case. It is plainly advantageous to the country to have at least the possibility of barter deals. The hon. Member for Macclesfield (Sir A. V. Harvey) stressed the réle of the British readiness to take a number of Lockheed airbuses for sale elsewhere in the world, and it is at least possible that this kind of exchange arrangement will become a feature of certain fields of advanced technology in the future. If we were to be without this power for barter it would undoubtedly handicap a number of markets.
      Mr. Peyton: The paragraph continues
      "…to sell, exchange or otherwise dispose of any such articles…"
      Why have the word "exchange" there? It is already in the previous line, where there appear the offending words
      …or articles to be exchanged for such articles…"
      That is what I do not understand. It seems to me to be quite unnecessary, and the Parliamentary Secretary has not satisfied me.
      Dr. Bray: If the hon. Gentleman looks at the sentence again he will see that the first part covers the acquisition of the article and the second part the disposal of it. Both are necessary for a barter transaction.
      Question put, That the Amendment be made:—
      The House divided: Ayes 125; Noes 146.

      Division No. 110.]

      AYES

      [1.10 a.m.

      Alison, Michael (Barkston Ash)

      Baker, W. H. K. (Banff)

      Blaker, Peter

      Astor, John

      Beamish, Col. Sir Tufton

      Boardman, Tom

      Awdry, Daniel

      Biggs-Davison, John

      Boyd-Carpenter, Rt. Hn. John

      Baker, K. W. (Acton)

      Black, Sir Cyril

      Brinton, Sir Tatton

      Brown, Sir Edward (Bath)

      Hiley, Joseph

      Pink, R. Bonner

      Bryan, Paul

      Hill, J. E. B.

      Price, David (Eastleigh)

      Buchanan-Smith, Alick (Angus, N&M)

      Holland, Philip

      Pym, Francis

      Buck, Antony (Colchester)

      Horoern, Peter

      Quennell, Miss J. M.

      Carr, Rt. Hn, Robert

      Hornby, Richard

      Ramsden, Rt. Hn. James

      Channon, H. P. G.

      Howell, David (Guildford)

      Rhys Williams, Sir Brandon

      Chichester-Clark, R.

      Hunt, John

      Ridley, Hn. Nicholas

      Corfield, F. V.

      Jenkin, Patrick (Woodford)

      Rossi, Hugh (Hornsey)

      Costain, A. P.

      Johnston, Russell (Inverness)

      Russell, Sir Ronald

      Crouch, David

      Jopling, Michael

      Scott, Nicholas

      Crowder, F.P

      Kershaw, Anthony

      Scott-Hopkins, James

      Dalkeith, Earl of

      King, Evelyn (Dorset, S.)

      Sharpies, Richard

      Dance, James

      Kirk, Peter

      Sinclair, Sir George

      Davidson, James (Aberdeenstare, W.)

      Kitson, Timothy

      Stainton, Keith

      Dean, Paul (Somerset, N.)

      Knight, Mrs. Jill

      Steel, David (Roxburgh)

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

      Lane, David

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

      Digby, Simon Wingfield

      Langford-Holt, Sir John

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

      Doughty, Charles

      Lubbock, Eric

      Taylor, Frank (Moss Side)

      du Cann, Rt. Hn. Edward

      MacArthur, Ian

      Temple, John M.

      Eden, Sir John

      Maclean, Sir Fitzroy

      Thatcher, Mrs. Margaret

      Elliot, Capt. Walter (Carshalton)

      McMaster, Stanley

      Turton, Rt. Hn. R. H.

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

      Maddan, Martin

      van Straubenzee, W. R.

      Emery, Peter

      Maginnis, John E.

      Wall, Patrick

      Eyre, Reginald

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

      Ward, Dame Irene

      Fair, John

      Mills, Peter (Torrington)

      Weatherill, Bernard

      Fisher, Nigel

      Mills, Stratton (Belfast, N.)

      Webster, David

      Fletcher-Cooke, Charles

      Mitchell, David (Basingstoke)

      Wells, John (Maidstone)

      Fortescue, Tim

      Monro, Hector

      Whitelaw, Rt. Hn. William

      Foster, Sir John

      Montgomery, Fergus

      Williams, W. D. (Dudley)

      Gibson-Watt, David

      More, Jasper

      Wilson, Geoffrey (Truro)

      Godber, Rt. Hn. J. B.

      Murton, Oscar

      Winstanley, Dr. M. P.

      Goodhart, Philip

      Neave, Airey

      Wolrige-Gordon, Patrick

      Goodhew, Victor

      Noble, Rt. Hn. Michael

      Worsley, Marcus

      Gresham Cooke, R.

      Nott, John

      Wright, Esmond

      Griffiths, Eldon (Bury St. Edmunds)

      Onslow, Cranley

      Wylie, N. R.

      Hall-Davis, A. G. F.

      Orr, Capt. L. P. S.

      Harrison, Col. Sir Harwood (Eye)

      Osborn, John (Hallam)

      TELLERS FOR THE AYES:

      Hawkins, Paul

      Percival, Ian

      Mr. Anthony Grant and

      Higgins, Terence L.

      Peyton, John

      Mr. Anthony Royle.

      NOES

      Allaun, Frank (Salford, E)

      Fletcher, Raymond (Ilkeston)

      McCann, John

      Alldritt, Walter

      Foot, Michael (Ebbw Vale)

      MacColf, James

      Alien, Scholefield

      Ford, Ben

      Macdonald, A. H.

      Anderson, Donald

      Fowler, Gerry

      McGuire, Michael

      Archer, Peter

      Freeson, Reginald

      Mackenzie, Gregor (Rutherglen)

      Atkinson, Norman (Tottenham)

      Garrett, W. E.

      McMillan, Tom (Glasgow, C.)

      Bagier, Gordon A. T.

      Gregory, Arnold

      MacPherson, Malcolm

      Barnett, Joel

      Grey, Charles (Durham)

      Mahon, Simon (Bootle)

      Benn, Rt. Hn. Anthony Wedgwood

      Griffiths, David (Rother Valley)

      Mallalieu, E. L. (Brigg)

      Binns, John

      Griffiths, Will (Exchange)

      Manuel, Archie

      Bishop, E. S.

      Hamilton, James (Bothwell)

      Mapp, Charles

      Btenkinsop, Arthur

      Hamling, William

      Marks, Kenneth

      Booth, Albert

      Harper, Joseph

      Marquand, David

      Boyden, James

      Harrison, Walter (Wakefield)

      Maxwell, Robert

      Bray, Dr. Jeremy

      Haseldine, Norman

      Mayhew, Christopher

      Brooks, Edwin

      Hattersley, Roy

      Mendelson, J. J.

      Buchan, Norman

      Hazell, Bert

      Millan, Bruce

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

      Henig, Stanley

      Miller, Dr. M. S.

      Carmichael, Neil

      Hooley, Frank

      Mitchell, R. C. (S'th'pton, Test)

      Carter-Jones, Lewis

      Horner, John

      Morgan, Elystan (Cardiganshire)

      Coleman, Donald

      Howarth, Robert (Bolton, E.)

      Morris, Charles R. (Openshaw)

      Concannon, J. D.

      Hoy, James

      Newens, Stan

      Crawshaw, Richard

      Huckfield, Leslie

      O'Malley, Brian

      Crossman, Rt. Hn. Richard

      Hughes, Roy (New)

      Orme, Stanley

      Cutten, Mrs. Alice

      Hunter, Adam

      Oswald, Thomas

      Davies, Dr. Ernest (Stretford)

      Hynd, John

      Owen, Will (Morpeth)

      Davidson, Arthur (Accrington)

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

      Page, Derek (King's Lynn)

      Davies, G. Elfed (Rhondda, E.)

      Jackson, Peter M. (High Peak)

      Palmer, Arthur

      Dell, Edmund

      Jenkins, Hugh (Putney)

      Parkyn, Brian (Bedford)

      Dewar, Donald

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

      Pavitt, Laurence

      Dickens, James

      Jones, J. Idwal (Wrexham)

      Pentland, Norman

      Dobson, Ray

      Jones, T. Alec (Rhondda, West)

      Perry, Ernest G. (Battersea, S.)

      Doig, Peter

      Kerr, Dr. David (W'worth, Central)

      Perry, George H. (Nottingham, S.)

      Dunn, James A.

      Lawson, George

      Price, William (Rugby)

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

      Leadbitter, Ted

      Probert, Arthur

      Eadie, Alex

      Ledger, Ron

      Rees, Merlyn

      Edwards, William (Merioneth)

      Lee, John (Reading)

      Roberts, Albert (Normanton)

      Ellis, John

      Lestor, Miss Joan

      Robertson, John (Paisley)

      Ennals, David

      Lewis, Ron (Carlisle)

      Rose, Paul

      Ensor, David

      Loughlin, Charles

      Ryan, John

      Evans, Ioan L, (Birm'h'm, Vardley)

      Lyon, Alexander W. (York)

      Silkin, Rt. Hn. John (Deptford)

      Faulds, Andrew

      Lyons, Edward (Bradford, E.)

      Silverman, Julius (Aston)

      Slater, Joseph

      Wallace, George

      Willis, Rt. Hn. George

      Spriggs, Leslie

      Watkins, David (Consett)

      Woodburn, Rt. Hn. A.

      Swain, Thomas

      Watkins, Tudor (Brecon & Radnor)

      Woof, Robert

      Tinn, James

      Wellbeloved, James

      Yates, Victor

      Urwin, T. W.

      Wells, William (Walsall, N.)

      Vartey, Eric G.

      Whitaker, Ben

      TELLERS FOR THE NOES:

      Wainwright, Edwin (Dearne Valley)

      Whitlock, William

      Mr. Harry Gourlay and

      Walker, Harold (Doncaster)

      Williams, Clifford (Abertillery)

      Mr. Neil McBride.

      Motion made, and Question put, That the Bill be now read the Third time:—
      The House dividend: Ayes 145, Noes 124.

      Division No. 111.]

      AYES

      [1.20 p.m.

      Allaun, Frank (Salford, E.)

      Criffiths, David (Rother Valley)

      Millan, Bruce

      Alldritt, Walter

      Griffiths, Will (Exchange)

      Miller, Dr. M. S.

      Allen, Scholefield

      Hamilton, James (Bothwell)

      Mitchell, R. C. (S'th'pton, Test)

      Anderson, Donald

      Hamling, William

      Morgan, Elystan (Cardiganshire)

      Archer, Peter

      Harper, Joseph

      Morris, Charles R. (Openshaw)

      Atkinson, Norman (Tottenham)

      Harrison, Walter (Wakefield)

      Newens, Stan

      Bagier, Gordon A. T.

      Haseldine, Norman

      O'Malley, Brian

      Barnett, Joel

      Hattersley, Roy

      Orme, Stanley

      Jinn, Rt. Hn. Anthony Wedgwood

      Hazell, Bert

      Oswald, Thomas

      Binns, John

      Henig, Stanley

      Owen, Will (Morpeth)

      Bishop, E. S.

      Hooley, Frank

      Page, Derek (King's Lynn)

      Blenkinsop, Arthur

      Horner, John

      Palmer, Arthur

      Booth, Albert

      Howarth, Robert (Bolton, E.)

      Parkyn, Brian (Bedford)

      Boyden, James

      Hoy, James

      Pavitt, Laurence

      Braine, Bernard

      Huckfield, Leslie

      Pentland, Norman

      Brooks, Edwin

      Hughes, Roy (Newport)

      Perry, Ernest G. (Battersea, S.)

      Buchan, Norman

      Hunter, Adam

      Perry, George H. (Nottingham, S.)

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

      Hynd, John

      Price, William (Rugby)

      Carmichael, Neil

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

      Probert, Arthur

      Carter-Jones, Lewis

      Jackson, Peter M. (High Peak)

      Rees, Merlyn

      Coleman, Donald

      Jenkins, Hugh (Putney)

      Roberts, Albert (Normanton)

      Concannon, J. D.

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

      Rose, Paul

      Crawshaw, Richard

      Jones, J. Idwal (Wrexham)

      Ryan, John

      Crossman, Rt. Hn. Richard

      Jones, T. Alec (Rhondda, West)

      Silkin, Rt. Hn. John (Deptford)

      Cullen, Mrs. Alice

      Kerr, Dr. David (W'worth, Central)

      Silverman, Julius (Aston)

      Davidson, Arthur (Accrington)

      Lawson, George

      Slater, Joseph

      Davies, Dr. Ernest (Stretford)

      Leadbitter, Ted

      Spriggs, Leslie

      Davies, G. Elfed (Rhondda, E.)

      Ledger, Ron

      Swain, Thomas

      Dell, Edmund

      Lee, John (Reading)

      Tinn, James

      Dewar, Donald

      Lestor, Miss Joan

      Urwin, T. W.

      Dickens, James

      Lewis, Ron (Carlisle)

      Varley, Eric G.

      Dobson, Ray

      Louglin, Charles

      Wainwright, Edwin (Dearne Valley)

      Doig, Peter

      Lyon, Alexander W. (York)

      Walker, Harold (Doncaster)

      Dunn, James A.

      Lyons, Edward (Bradford, E.)

      Wallace, George

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

      McCann, John

      Watkins, David (consett)

      Eadie, Alex

      MacColl, James

      Watkins, Tudor (Brecon & Radnor)

      Edwards, William (Merioneth)

      Macdonald, A. H.

      Wellbeloved, James

      Ellis, John

      McGuire, Michael

      Welts, William (Walsall, N.)

      Ennals, David

      Mackenzie, Gregor (Rutherglen)

      Whitaker, Ben

      Ensor, David

      McMillan, Tom (Glasgow, C.)

      Whitlock, William

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

      Macpherson, Malcolm

      Williams, Clifford (Abertillery)

      Faulds, Andrew

      Mahon, Simon (Bootle)

      Willis, Rt. Hn. George

      Fletcher, Raymond (Ilkeston)

      Mallalieu, E. L. (Brigg)

      Woodburn, Rt. Hn. A.

      Foot, Michael (Ebbw Vale)

      Manuel, Archie

      Woof, Robert

      Ford, Ben

      Mapp, Charles

      Yates, Victor

      Fowler, Gerry

      Marks, Kenneth

      Freeson, Reginald

      Macquand, David

      TELLERS FOR THE AYES:

      Garrett, W. E.

      Maxwell, Robert

      Mr. Harry Gourlay and

      Gregory, Arnold

      Mayhew, Christopher

      Mr. Neil McBride.

      Crey, Charles (Durham)

      Mendelson, J. J.

      NOES

      Alison, Michael (Barkston Ash)

      Buck, Antony (Colchester)

      du Cann, Rt. Hn. Edward

      Astor, John

      Carr, Rt. Hn. Robert

      Eden, Sir John

      Awdry, Daniel

      Channon, H. P. G.

      Elliot, Capt. Walter (Carshalton)

      Baker, K. W. (Acton)

      Chichester-Clark, R.

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

      Baker, W. H. K. (Banff)

      Corfield, F. V.

      Emery, Peter

      Beamish, Col. Sir Tufton

      Costain, A. P.

      Eyre, Reginald

      Biggs-Davison, John

      Crouch, David

      Farr, John

      Black, Sir Cyril

      Crowder, F. P.

      Fisher, Nigel

      Blaker, Peter

      Dalkeith, Earl of

      Fletcher-Cooke, Charles

      Boardman, Tom

      Dance, James

      Fortescue, Tim

      Boyd-Carpenter, Rt. Hn. John

      Davidson, James (Aberdeenshire, W.)

      Foster, Sir John

      Brinton, Sir Tatton

      Dean, Paul (Somerset, N.)

      Gibson-Watt, David

      Brown, Sir Edward (Bath)

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

      Godber, Rt. Hn. J. B.

      Bryan, Paul

      Digby, Simon Wingfield

      Goodhart, Philip

      Buchanan-Smith, Alick (Angus, N & M)

      Doughty, Charles

      Goodhew, Victor

      Gresham Cooke, R.

      Maginnis, John E.

      Scott-Hopkins, James

      Griffiths, Eldon (Bury St. Edmund)

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

      Sharpies, Richard

      Hall-Davis, A. G. F,

      Mills, peter (Torrington)

      Sinclair, sir George

      Harrison, Col. Sir Harwood (Eye)

      Mills, Stratton (Belfast, N.)

      Stainton, Keith

      Hawkins, Paul

      Mitchell, David (Basingstoke)

      Steel, David (Roxburgh)

      Higgins, Terence L.

      Monro, Hector

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

      Hiley, Joseph

      Montgomery, Fergus

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

      Hill, J. E. B.

      More, Jasper

      Taylor, Frank (Mote Side)

      Holland, Philip

      Murton, Oscar

      Temple, John M.

      Hordern, Peter

      Neave, Airey

      Thatcher, Mrs. Margaret

      Hornby, Richard

      Noble, Rt. Hn. Michael

      Turton, Rt. Hn. R. H.

      Howell, David (Guildford)

      Nott, John

      van Straubenzee, W. R.

      Hunt, John

      Onslow, Cranley

      Wall, Patrick

      Jenkin, Patrick (Woodford)

      Orr, Capt. L. P. S.

      Ward, Dame Irene

      Johnston, Russell (Inverness)

      Osborn, John (Haltam)

      Webster, David

      Jopling, Michael

      Percival, Ian

      Wells, John (Maidstone)

      Kershaw, Anthony

      Peyton, John

      Whitelaw, Rt. Hn. William

      King, Evelyn (Dorset, S.)

      Pink, R. Bonner

      Williams, W. D. (Dudley)

      Kirk, Peter

      Price, David (Eastleigh)

      Wilson, Geoffrey (Truro)

      Kitson, Timothy

      Pym, Francis

      Winstanley, Dr. M. P.

      Knight, Mrs. Jilt

      Quennell, Miss J. M.

      Wolrige-Gordon, Patrick

      Lane, David

      Ramsden, Rt. Hn. James

      Worsley, Marcus

      Langford-Holt, Sir John

      Rhys Williams, Sir Brandon

      Wright, Esmond

      Lubbock, Eric

      Ridley, Hn. Nicholas

      Mac Arthur, Ian

      Rossi, Hugh (Hornsey)

      TELLERS FOR THE NOES:

      Maclean, Sir Fitzroy

      Royle, Anthony

      Mr. Anthony Grant and

      McMaster, Stanley

      Russell, Sir Ronald

      Mr. Bernard Weatherill.

      Maddan, Martin

      Scott, Nicholas

      Bill accordingly read the Third time, and passed.

  CUSTOMS DUTIES (DUMPING AND SUBSIDIES) AMENDMENT BILL
  Second Reading deferred till this day.

  CLEAN AIR BILL
  Order read for resuming adjourned debate on Question [28th March],
  That Standing Committee C be discharged from considering the Bill.
  That the Bill be committed to a Committee of the whole House.—[Mr. Maxwell.]
  Question again proposed.
  Hon. Members: Object.
  Debate further adjourned till Tomorrow.

  NATIONAL INSURANCE (INDUSTRIAL DISEASES)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Varley.]
  1.30 a.m.
  Mr. Paul B. Rose: The National Insurance (Industrial Injuries) Act, 1946, was one of those advances in social security which helped to lay the foundation of the Welfare State. It was a monument to the Labour Government of 1945 and, in
  particular, to my right hon. Friend the Member for Llanelly (Mr. James Griffiths) and to those miner Members of Parliament and members of my own profession, the legal profession, who were deeply concerned about the rights of the injured employee.
  It may well be that the time has come to review the whole field of benefits to decide whether we need to go on distinguishing between industrial accidents and diseases and other types of accidents and diseases. It may also be that the system of supplementary benefits has taken away most of the hardship where claims are rejected.
  Nevertheless, an anomaly exists in the working of the Act which may be dealt with, perhaps, piecemeal in extending the schedule of diseases, even retroactively, or which may be dealt with by invoking a new legal principle. The anomaly occurs where an employee in a particular industry suffers from a disease which may manifest itself only after a long interval, where there is an apparent or obvious casual connection between the man's employment and the disease.
  If the disease is prescribed in relation to that employment, the man is safeguarded. If the disease is held by the tribunal or the commissioner to have been caused by an accident, again the man is safeguarded. If neither of those safeguards is present, his claim fails. To my mind, some of the decisions on this subject border on the metaphysical. I will outline some of them presently.
  It is true that in reply to a Parliamentary Question which I put down on 6th February last year, and a later one on 6th November, the findings of the Commit tee under the chairmanship of Mr. Beney, Q.C., were quoted against the practicability of any change in the current situation. My hon. Friend the Parliamentary Secretary to the Ministry of Health said on that latter occasion:
  "There have been no developments since which offer any solution to this problem."—[OFFICIAL REPORT, 6th November, 1967; Vol. 753, c. 47.]
  The Committee met 13 years ago.
  The Report of the Departmental Committee makes fascinating reading. While its majority conclusion negatives my own contention, it nevertheless starkly points out the unsatisfactory situation which exists. Paragraph 52 states:
  "The same disease may be within the scheme in some cases but not in others—fibrositis, for example, may be accepted as within the scheme if it results from one or two bad wettings but not if contracted from many years' work in damp conditions."
  Nevertheless, in spite of that, the Committee said that it was satisfied that
  "the distinction between a disease contracted gradually and injury by accident corresponds to practical difference between something in the realm of conjecture and something more readily probable."
  I am not at all satisfied that that is the case.
  I do no accept this legal distinction between accident and process as a valid and valuable one, as the Committee did. Indeed, it may well be that a disease caused by a process is more obviously related to occupation than one which is caused by a so-called accident. To my mind, this is a legal fiction employed to minimise the unfortunate results of the gap in the provision for those who suffer from non-prescribed diseases.
  In one case in 1951, a pug feeder in a brickworks had to lift 700 blocks of marl every day about 6 ft. The blocks weighed 50–60 lbs. each. It was held that the condition of strained chest muscles from which the man suffered was due to process avid not to accident and, therefore, he did not succeed in his claim.
  Yet in another case the claimant operated an air press and his work involved lifting a counterbalance weight many times a day. He became incapable
  570
  of work as a result of a strained heart and was entitled because, to quote the words of the commissioner
  "The physiological change so gradually occurring by reason of the repeated operation of lifting a weight, may, I think, be properly spoken of as an accident in the sense in which it is used in this connection, that is to say each minute change is regarded as an unlooked for occurrence".
  His claim was allowed because a generous commissioner in that case was able to stretch the concept of accident, but to distinguish between the two cases is fruitless and only exposes the anomaly of the situation.
  In an article which I wrote for the Industrial Law Review as far back as 1959 I pointed out a whole series of anomalous decisions. Admittedly these were borderline cases, but why should we have any borderline cases at all? Why is a borderline necessary? The Beney Committee gave an answer—the contention that it is futile to expect individual doctors to provide answers. It did not expect a doctor to be able to find the answer. It is true that some diseases present problems beyond the current knowledge of doctors. While, as the Committee said, there is great scope for differing medical opinions, I do not accept the Committee's contention that a change in the position would multiply hard cases instead of diminishing them, because there is no reason to abandon the scheme of prescribed diseases.
  Indeed, one could extend the Schedule of prescribed diseases, but for those which are not within the Schedule and which are not prescribed in relation to a particular employment, the formula of the balance of probability rather than cause by accident or process would be far more acceptable, so that all diseases which on the balance of probability arose out of employment, on current medical knowledge, would qualify the claimant to industrial injury benefit. Occupational causation on the balance of probability is the ultimate answer, in spite of the practical difficulties which the Committee mentioned.
  The position would not be so bad were it not for the slowness with which the Ministry appears to be dealing with certain standard problems of industrial disease. My hon. Friend the Member for Bolton, West (Mr. Oakes) did a service

  571
  to the House and the country and perhaps to many claimants to come when he put a series of probing Questions which were answered by my hon. Friend only two days ago. The replies revealed that farmer's lung was prescribed from 21st June, 1965, and byssinosis among certain flax workers from 1st November, 1965. The question of prescribing vibration syndrome was referred to the Industrial Injuries Advisory Council in January, 1967, and yet we are still awaiting the findings of the Council 15 months later.
  I hope that some sense of urgency will be shown about this. The scheme of research on occupational deafness, a particularly important subject, was first commissioned in 1962 and has not even reported, while the Industrial Injuries Advisory Council itself, according to these replies, met only once during 1967, and then, I understand, only for a couple of hours. This does not inspire confidence in the urgency with which these matters are being stressed by the Government. There is mounting feeling particularly about industrial deafness. The minority Report of 13 years ago stressed the difficulty of getting diseases added to the prescribed list in the Schedule, and in particular it mentioned Reynaud's Phenomenon, and I hope again that my hon. Friend will look at the matter with some sense of urgency.
  It might be difficult to deal with some of these matters merely by adding new diseases to the Schedule, and for this reason I support, as the minority Report did, the test of balance of probability. I propose to cite some more cases in support of this. An injury which arose from contact with salt for a period of three months was held to be the result of a process, and not an accident, and therefore the claimant failed. The reductio ad absurdem of this was a case in 1951 when an employee suffered an ulcerated leg from wearing boots that were too small. The tribunal found in his favour, although this occurred over a period of three months, because it said that the rubbing was continual, but the final break by which the infection penetrated was an accident. I wonder whether my hon. Friend really thinks that this could be said to be anything but an artificial decision, albeit a humane one.
  The artificiality lies in the fact that in each "process" there must be a minute change, followed by another minute change, and yet another one, until some qualitative change takes place. The Commissioner came very near to realising this when he said in one case in 1949:
  "Any further extention of the principle such as might have been invoked in a decision in the claimant's favour would tend to make the dividing line between accidental injury by disease and injury merely by disease almost if not entirely indistinguishable."
  My submission is that these concepts are indistinguishable.
  More recent decisions have borne out the contention that I made in 1959, a view which I formed after spending a year doing research into the British system of industrial injuries insurance, compared with the equivalent French system.
  The injustice of the present position was underlined by a case as recently as 1966, and I think that it is worth referring to. In this case, the insured person had been employed for the last 18 years of his life in the blasting department of a chemical factory, where he was more or less continually exposed to ethylene glycol dinitrate, and also to nitroglycerine. He died suddenly at 10 a.m. on a Monday, a holiday, having done no work since the previous Friday. It is an interesting case, because investigations by toxologists, cardiologists, and experts in industrial medicine have indicated that prolonged exposure to these chemicals can cause sudden death, but what is more interesting is that the records of such deaths show that they usually occur when a person is not at work, but after a period of two days' absence from the work, and, strangely enough, frequently on a Monday morning.
  It was held by the Commissioner that the death was caused by his employment, but that it had not been shown that it was caused by personal injury caused by an accident. In other words, it was admitted that the disease was caused by the employment, but because it was not caused by accident, and because it was not scheduled, no benefit was payable to his next-of-kin. This is a clear indication of where the law as it operates today is at fault.
  On the other hand, a person with a degenerative disc condition was entitled

  573
  when, after a sudden click, he found that he had a complete prolapse of an already partly prolapsed disc because there was an element of suddenness about it. Following this condition, he was regarded having suffered a disease caused by an accident, and yet a person who had suffered a month's exposure to ultraviolet radiation and suffered a disease of the hand was held to have suffered injury by accident.
  Mr. Speaker: Order. I am listening with complete sympathy to the hon. Member, but it seems that he is suggesting an alteration in the law. He cannot do that on the Adjournment.
  Mr. Rose: I anticipated that you might remind me of that, Mr. Speaker. There are a number of ways—for example, by an extension of the Schedule—in which to deal with this matter, but I appreciate your reminder and I will not advocate any changes in the law.
  Time seems to have been the essence of these decisions. It seems so artificial and unjustifiable that I urge the Parliamentary Secretary to undertake at least to look into the whole question. After the 13 years which have elapsed since the last committee reported on this issue, I urge him to look at the whole matter, to review once again the anomalous position that exists and to speed up some of the processes by, in the meantime, adding to the Schedule so that some of the gaps may be filled.
  1.46 a.m.
  The Joint Parliamentary Secretary to the Ministry of Social Security (Mr. Charles Loughlin): I listened carefully to what my hon. Friend has said on this intractable problem. He has, I know, long been interested in this subject and I pay tribute to the way in which he has marshalled his arguments.
  In the course of his speech he referred to a number of decisions given by the National Insurance Commissioner in individual cases. The Commissioner is, of course, an entirely independent judicial authority and my hon. Friend will not expect me to comment in detail on the merits of his decisions. I would only say that the essential issue before the Commissioner was whether there had been personal injury caused by accident
  574
  and not whether the conditions in question were attributable to an occupational origin, and this point would not therefore, have been fully argued.
  I remind the House of the cover which the Industrial Injuries Scheme affords. It provides benefits to compensate incapacity, disablement and death which result from personal injury by accident arising out of, and in the course of, insurable employment and from diseases prescribed under Section 56(2) of the Industrial Injuries Act, or, failing this, if the disease arose by accident. It follows that injuries and diseases caused by an occupation, but which arose by a gradual process do not, unless they are prescribed, qualify the sufferer for industrial injuries benefit.
  My hon. Friend, in developing his argument, suggested that this existing basis for compensating diseases should be swept away and that all diseases arising out of the claimants' employment should instead attract compensation under the Scheme. This proposal was among those which were fully examined by a Committee under the chairmanship of Mr. F. W. Beney, Q.C., to which my hon. Friend referred, which was appointed in 1953 to review the provisions of the Industrial Injuries Act, under which benefit is paid for diseases and for personal injuries not caused by accident.
  The Committee began by considering the question of "general cover"—that is, the extension of the Scheme to all cases where a disease has, on balance of probability, been caused by the claimant's occupation. Though it was the view of the majority of the Committee that to provide benefit for diseases on the same footing as for accidents would be the proper course, if it were possible, they were convinced that this was not practicable, and recommended that the present system of prescription should be adhered to. The greatest objection they found to any extension of this kind was that there would be a very large number of claims which would raise questions unanswerable in the present state of medical knowledge, on which no satisfactory decision could be given on causation. Two examples might be an outdoor worker claiming that his arthritis was caused by ordinary climatic conditions and a manager claiming that mental stress had caused his peptic ulcer or his neurosis.

  575
  In the short time available for an Adjournment debate it is not possible for me to give a comprehensive number of such cases. It would inevitably be common for different decisions to be given on cases presenting similar facts. In aggravation cases—that is, where the question was one of assessing what proportion of total disability was to be attributed to the effect of employment—determination would be particularly difficult. In the event there would be a great deal of argument about medical questions on which often no clear-cut answer could be given. This would be very expensive both in scarce medical resources and in cost. Anomalies would be widespread as would dissatisfaction and a sense of grievance at apparently conflicting decisions. Finally, persons considering making a claim would be unable to assess with any accuracy their prospects of succeeding.
  My hon. Friend has criticised the distinction drawn between "accident" and "process". The Beney Committee also considered this distinction between a disease contracted by accident and a disease contracted by a gradual process. Where a disease develops over so long a period that it cannot reasonably be accepted as due to accident, benefit can be paid only if the disease has been prescribed. The majority of the Committee reported that:
  "alleged injuries by accident are, in general, capable of being proved—or disproved—with a much greater degree of certainty than injuries by process; in the nature of things it is much easier to establish whether an injury has resulted from a single incident or limited series of incidents than it is to establish the cause of a disease which has developed gradually, and even imperceptibly over a considerable period of time."
  They therefore accepted the distinction between "accident" and "process" as valid and valuable, and corresponding broadly to a practical difference between something conjectural and something more readily provable.
  The Beney Committee also looked at the conditions for prescription under the Act, the underlying principle of which is that the link between the occupation and the disease must be established. Once a disease is prescribed it is usually possible to give claimants the benefit of a presumption that the disease was due to the nature of the occupation, with the result that claims can be determined
  576
  quickly. The majority of the Committee recommended that the system of prescription should remain the basis of the scheme but went on to consider if any relaxation of the conditions for prescription was possible. They examined and rejected the possibility of a blanket cover for all persons contracting a given disease in a given occupation where there was a balance of probability that the disease was caused or aggravated by working conditions. They also considered whether blanket cover could be given, limited by special qualifying conditions such as length of exposure, or extent of disablement. This also had to be rejected, because it was the absence of medical knowledge required to draw up such conditions which stood in the way of prescription.
  The Committee also inquired whether it was practical to give "open" prescription—that is, prescription of a disease without giving the claimant the benefit of a presumption that the disease was due to the nature of the employment, as is at present done in cases of industrial dermatitis. Here the majority of the Committee felt that future research might show that there were other diseases which were not predominantly of occupational origin but which could reasonably be prescribed without the benefit of a presumption and recommended that this should receive careful consideration.
  We have so far not found any disease which has features which would make "open" prescription possible. It was possible, as the Beney Committee said, to treat dermatitis in this way because its bodily location and the known effects of a wide range of substances enabled reliable decisions to be reached in individual cases. "Open" prescription is, however, inappropriate where a disease lacks features which would allow occupational cases to be identified with reasonable certainty and in such diseases as bronchitis and rheumatism, which are sometimes suggested as candidates for prescription on those terms, there is no such method of distinction. To put the onus of proof on the claimant is no solution to the very great difficulties involved in adjudication which I have already described as inherent in the provision of any general cover.
  There is a further, and important point about the prescribing of diseases such as

  577
  bronchitis and rheumatism which are common among the population at large. The number of awards of benefit under the scheme would be very greatly increased, many cases being transferred from the main National Insurance Scheme. If this process were continued it might well put in jeopardy the whole Industrial Injuries Scheme with its attendant preferential rates of benefit.
  I think I have said enough to show that the alternatives to the present conditions for benefit in cases of industrial disease have been and continue to be very carefully considered. We keep fully abreast of developments in the general field of occupational health, and ensure that possible disabilities which may arise I from new industrial processes or the use of new substances are brought to our notice.
  To this end close contact is maintained with the other Government Departments concerned, notably the Medical Research Council, and the Ministries of Labour, Power, and Agriculture, Fisheries and Food, which have responsibilities for the health of workers in industry and suitable powers to carry out any requisite research. En addition, the Industrial Injuries Advisory Council, which includes in its membership a number of doctors distinguished in various fields of medicine, as well as representatives of both sides
  578
  of industry, plays an important part by virtue of its general powers of initiative to take up subjects which seem worth investigating and to make recommendations to the Minister. If consideration of the possibility of prescription of any particular disease seems to be held up by lack of research work, the powers of Section 71 of the Act, which allows the Minister to sponsor research, can be invoked.
  I want to tell my hon. Friend, on the question which he raised of the large scale project on occupational deafness, that we hope this will be completed this year. This is one example of the use we make of these powers.
  I do not want anybody to think that I am unsympathetic to the problems inherent in this general issue. I can go no further tonight than to say to my hon. Friend that, because I am sympathetic to the type of cases he has mentioned, and the difficulties which are inherent in the present situation, I shall watch very closely developments in this field, and I hope that some of the difficulties which we have to face may be ended.
  Question put and agreed to.
  Adjourned accordingly at two minutes to Two o'clock.

AGRICULTURE, FISHERIES AND FOOD
  Antibiotics (Animal Husbandry and Veterinary Medicine)
  Antibiotics (Animal Husbandry and Veterinary Medicine)
  Milk (Price Increase)
  Milk (Price Increase)
  Organochlorine Pesticides
  Organochlorine Pesticides
  Wheat Imports
  Wheat Imports
  Farming Grants and Subsidies
  Farming Grants and Subsidies
  Ice Cream (Price Increases)
  Ice Cream (Price Increases)
  Soil Erosion, East Anglia
  Soil Erosion, East Anglia
  Foot-and-Mouth Disease
  Foot-and-Mouth Disease
  Pedigree Dogs (Export to Japan)
  Pedigree Dogs (Export to Japan)
  Rural Development Board of Wales (Objections)
  Rural Development Board of Wales (Objections)
  Eggs (Deficiency Payment Scheme)
  Eggs (Deficiency Payment Scheme)
  Eggs (Imports)
  Eggs (Imports)
  Hydrocarbon Oils Duty (Northern Ireland)
  Hydrocarbon Oils Duty (Northern Ireland)
  Surplus Potatoes
  Surplus Potatoes
SCOTLAND
  David MacBrayne Limited (Subsidies and Charges)
  David MacBrayne Limited (Subsidies and Charges)
  Comprehensive School, Rutherglen and Cambuslang
  Comprehensive School, Rutherglen and Cambuslang
  Social Workers
  Social Workers
  Hospital Beds (Mentally Ill Patients)
  Hospital Beds (Mentally Ill Patients)
  Housing
  Housing
  Mental Hospitals
  Mental Hospitals
  Employment
  Employment
  Further Education
  Further Education
  Crimes of Violence
  Crimes of Violence
  Secondary Schools (Completions)
  Secondary Schools (Completions)
  Nurses and Midwives (Pay)
  Nurses and Midwives (Pay)
SHIPPING
  Registered Fishing Craft (Kent and Sussex Coast)
  Registered Fishing Craft (Kent and Sussex Coast)
  Fishing Craft Skippers (Qualifications)
  Fishing Craft Skippers (Qualifications)
  British Yards (Orders)
  British Yards (Orders)
  Argentine Merchant Vessels (Orders)
  Argentine Merchant Vessels (Orders)
AVIATION
  HS125 Aircraft (Departmental Operations)
  HS125 Aircraft (Departmental Operations)
  Turnhouse Airport (Transfer Agreement)
  Turnhouse Airport (Transfer Agreement)
  Cambrian Airways
  Cambrian Airways
BOARD OF TRADE
  Investment Grants
  Investment Grants
  United States Products (Imports)
  United States Products (Imports)
  Local Employment Acts (Financial Assistance)
  Local Employment Acts (Financial Assistance)
  Film Industry
  Film Industry
  Metals (Requirements)
  Metals (Requirements)
  Computers (Exports)
  Computers (Exports)
  Canada
  Canada
  Hosiery and Knitwear Industry (Levy)
  Hosiery and Knitwear Industry (Levy)
MINISTRY OF DEFENCE
  Argentine Naval Vessels (Orders)
  Argentine Naval Vessels (Orders)
  Bishopscourt Airfield
  Bishopscourt Airfield
  Married Quarters (Qualifying Age)
  Married Quarters (Qualifying Age)
  "British Rainfall 1961"
  "British Rainfall 1961"
  Falkland Islands
  Falkland Islands
RAILWAYS
  Land (Disposal)
  Land (Disposal)
  Automatic Half-Barrier Crossings (Safeguards)
  Automatic Half-Barrier Crossings (Safeguards)
  Statement of Accounts
  Statement of Accounts
ROADS
  A625, Harewood Bridge- Pool-in-Wharfedale
  A625, Harewood Bridge- Pool-in-Wharfedale
  Winchelsea Bypass Road
  Winchelsea Bypass Road
  Road Programme
  Road Programme
TRANSPORT
  Aberdeen Fishing Industry
  Aberdeen Fishing Industry
  Goods Vehicles Survey
  Goods Vehicles Survey
  Child Cyclists
  Child Cyclists
  Vehicle Testing
  Vehicle Testing
  London Transport (Lost Property)
  London Transport (Lost Property)
  Vehicle Excise Duty
  Vehicle Excise Duty
  Vehicle Owners (Legal Requirements)
  Vehicle Owners (Legal Requirements)
  Maritime Industrial Areas (Development)
  Maritime Industrial Areas (Development)
NATIONAL FINANCE
  Decimalisation
  Decimalisation
  Corporation Tax, Close Company Distributions and Regional Employment Premium (Scotland)
  Corporation Tax, Close Company Distributions and Regional Employment Premium (Scotland)
  Industrial and Commercial Establishments, Scotland (Tax Revenue)
  Industrial and Commercial Establishments, Scotland (Tax Revenue)
  Special Charge (Payment)
  Special Charge (Payment)
  Nationalised Industries
  Nationalised Industries
  Sickness Benefit (Saving)
  Sickness Benefit (Saving)
  Public Works Loan Board (Loans to Local Authorities)
  Public Works Loan Board (Loans to Local Authorities)
  Consolidated Fund and National Loans Fund
  Consolidated Fund and National Loans Fund
  Selective Employment Tax
  Selective Employment Tax
EDUCATION AND SCIENCE
  Secondary Schoolchildren (Milk)
  Secondary Schoolchildren (Milk)
  Students (Maintenance Grants)
  Students (Maintenance Grants)
MINISTRY OF POWER
  Imported Crude Oil (Cost)
  Imported Crude Oil (Cost)
  Oil Rig "Trans-Ocean II"
  Oil Rig "Trans-Ocean II"
  Nuclear Power Costs
  Nuclear Power Costs
  North Sea Gas (Price)
  North Sea Gas (Price)
  Seaton Carew (Power Station)
  Seaton Carew (Power Station)
  Steel Industry, Wales
  Steel Industry, Wales
COMMONWEALTH AFFAIRS
  British Honduras
  British Honduras
  Falkland Islands
  Falkland Islands
ECONOMIC AFFAIRS
  Pay Increases (Assembly of Imported Components)
  Pay Increases (Assembly of Imported Components)
  Prices and Incomes (White Paper)
  Prices and Incomes (White Paper)
HOSPITALS
  Special Hospitals
  Special Hospitals
  New Hospital, Maidstone Area
  New Hospital, Maidstone Area
  Merioneth, Wrexham and Aberystwyth
  Merioneth, Wrexham and Aberystwyth
HOME DEPARTMENT
  Criminal Courts (Powers)
  Criminal Courts (Powers)
LOCAL GOVERNMENT
  Water Resources, Devon
  Water Resources, Devon
  Beach Area Redevelopment Scheme, Lowestoft
  Beach Area Redevelopment Scheme, Lowestoft
  Statutory Lists
  Statutory Lists
  Allotment Land, Enfield (Sale)
  Allotment Land, Enfield (Sale)
  Historic Buildings and Ancient Monuments (Repair Grants)
  Historic Buildings and Ancient Monuments (Repair Grants)
HOUSING
  Compulsory Purchase Orders
  Compulsory Purchase Orders
  Bradford
  Bradford
MINISTRY OF LABOUR
  Disabled Persons, Blaenau Ffestiniog
  Disabled Persons, Blaenau Ffestiniog
  Women's Employment (Report)
  Women's Employment (Report)
  Cinematograph Industry (Training Board)
  Cinematograph Industry (Training Board)
OVERSEAS DEVELOPMENT
  Zambia (Grants and Loans)
  Zambia (Grants and Loans)
  British Overseas Aid
  British Overseas Aid
TECHNOLOGY
  Concorde Aircraft
  Concorde Aircraft
  Bristol Siddeley Employees (Suspension)
  Bristol Siddeley Employees (Suspension)
WALES
  House Improvement Grants
  House Improvement Grants
  Welsh Water Resources Board
  Welsh Water Resources Board
  New Town Corporation (Remit)
  New Town Corporation (Remit)
  Parliament for Wales
  Parliament for Wales
  Welsh Office (Staff)
  Welsh Office (Staff)

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

HONG KONG SCHOOL TEXT BOOKS
2.35 p.m.
LORD BEAUMONT OF WHITLEY: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether the Hong Kong Government intend to make grants towards the cost of text books and stationery for children occupying places in Government-aided primary schools.]
THE MINISTER OF STATE FOR COMMONWEALTH AFFAIRS (LORD SHEPHERD): My Lords, the Colony's Financial Secretary indicated in his Budget speech on February 28 that the Hong Kong Government are considering assistance to children who have free places in Government and aided primary schools to help meet the cost of text books and stationery. I am unable to add to that statement at the present time.
LORD BEAUMONT OF WHITLEY: My Lords, I thank the noble Lord for his satisfactory reply. May I ask him whether he is aware that the cost per child for books and stationery can at the moment amount to between 40 and 50 Hong Kong dollars per year, and that in a large family this can cause great hardship? I would further ask, therefore, whether Her Majesty's Government would be prepared to use their influence with the Hong Kong Government to see that a decision is taken to go ahead with this reform?
LORD SHEPHERD: My Lords, the noble Lord is aware that there is a Government in Hong Kong with an Executive
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Council and a Legislative Council, and I do not think it would be right to use influence, if by "influence" we mean pressure, on decisions that they must make in taking into account the needs of these schoolchildren and the moneys that are available. But I can assure the noble Lord, from my own experience of the Government there, that this is a matter which they have very much in mind.
LORD BROCKWAY: My Lords, I welcome my noble friend's reply, which confirms what he said on December 19 when we had a debate on this subject. In view of the wretched standard of wages of the mass of the people in Hong Kong and their enthusiasm for education, would he press for a decision on this matter as rapidly as possible?
LORD SHEPHERD: My Lords, this matter is under very active consideration.
VISCOUNT DILHORNE: My Lords, would it not be wise to leave questions of pressure on the Hong Kong Government to the Liberal members of that Government?
BARONESS SUMMERSKILL: My Lords, can my noble friend tell me what is the degree of literacy in Hong Kong?
LORD SHEPHERD: My Lords, Hong Kong is now a Colony of some 4 million people. It has come to that figure from 600,000 in 1945, and I should not like to hazard a guess about what the percentage is. I believe, however, that it is relatively small.

SCHOOLCHILDREN AND VIOLENCE TO TEACHERS
LORD BEAUMONT OF WHITLEY: My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they have any records of incidents of violence offered by pupils to teachers in schools and, if so, what are any relevant figures for the immediate past.]
BARONESS PHILLIPS: My Lords, Her Majesty's Government have no such records.
LORD BEAUMONT OF WHITLEY: My Lords, I thank the noble Baroness for her Answer. May I ask whether she is aware that there is considerable feeling among teachers and others that there is a problem here? If this is so, the best way of dealing with this feeling is to make quite certain that there are records of incidents which, if they were common, would amount to a very distressing and disturbing symptom.
BARONESS PHILLIPS: My Lords, as the noble Lord may well know, matters of school behaviour are the responsibility of the governors, the teachers and the local education authority. If the matter were of sufficient seriousness, it might well come within the purview of the local court. I note that the noble Lord says that there is growing disturbance among the teachers on this question. If he would care to communicate with me later I will convey his comments to my right honourable friend.
LORD BALFOUR OF INCHRYE: My Lords, would the incidence of violence of the Young Liberals to the elder teachers in the Party be included?
LORD BYERS: My Lords, is the noble Baroness aware that it is very welcome?
LORD BEAUMONT OF WHITLEY: My Lords, I welcome the obvious interest of the noble Baroness in what I think is becoming a problem. May I ask whether the Government are aware of the necessity for dealing with this kind of behaviour before it becomes a problem, as, unfortunately, was not done by learning a lesson from, say, what happened in America in a similar way over racial problems?
BARONESS PHILLIPS: My Lords, the noble Lord may be reassured that the recommendations of the Plowden Committee in relation to certain areas where there was social deprivation are now being studied very carefully and will be followed through. Her Majesty's Government have no record of an increase in the violence which the noble Lord has mentioned.

GIBRALTAR CONSTITUTION TALKS
2.41 p.m.
LORD MERRIVALE: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
[The Question was as follows.
To ask Her Majesty's Government, in view of the outcome of the latest talks in Madrid on Gibraltar, whether they will make a statement on the proposals for constitutional changes contained in the recent Report of the Gibraltar Constitutional Committee under the chairmanship of Mr. P. J. Isola, Deputy Chief Minister.]
LORD SHEPHERD: My Lords, we are paying close attention to the Report of the Constitution Committee, but it would not be helpful for me now to make any statement about it.
LORD MERRIVALE: My Lords, I thank the noble Lord for that very brief Answer. Now that the Anglo-Spanish talks are over, and in view of Gibraltar's need for stability and security, would not the Minister agree that the final talks for constitutional changes should be held at the earliest opportunity; and can the noble Lord now say when these talks will take place?
LORD SHEPHERD: My Lords, I indicated when we last discussed Gibraltar that I hoped we should have the more formal constitutional discussions early in the summer. We are working very carefully on the proposals that have been put to us by the elected members from Gibraltar, and on some of our own proposals. I should not wish to hurry these forward until at least we have been able to get most of the "t's" crossed and the "i's" dotted, so that when we have a conference we can get a proper and satisfactory solution.
LORD MERRIVALE: My Lords, as the noble Lord said, Her Majesty's Government are working on these proposals. Can he say along what guide lines they are working as to the form this new Constitution will take? May I ask him one final question regarding Part III of the Report concerning the link with Britain? Does he recognise that there is a strong and persuasive recommendation that on

1225
decolonisation the Commonwealth Immigrants Act should not apply to Gibraltar? Would he not agree that Gibraltar is a unique case, being the only Commonwealth territory which is in Europe and which is hampered by the Treaty of Utrecht?
THE LORD PRIVY SEAL (LORD SHACKLETON): My Lords, we all share the noble Lord's interest in this question, but I think he is taking the question form of a supplementary a little too far. Questions are designed to elicit information.
LORD SHEPHERD: My Lords, in regard to the guide lines to which the noble Lord first referred, perhaps he would look at what I said in our last debate, when I set them out in some detail. As to how we see the Constitution developing, I should not wish to go any further than what I have said in my original answer. In regard to the Commonwealth Immigrants Act and its application to Gibraltar, I am sure the House is well aware of the views of Her Majesty's Government. While they may not necessarily be accepted in Gibraltar, I think that they are understood and appreciated.

GIBRALTAR FRONTIER RESTRICTIONS
LORD MERRIVALE: My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether it is true that Spain intends to apply new frontier restrictions against Gibraltar from April 15 next; whether they will affect British tourists and the economy of the Rock; and what counter-measures they propose to take.]
THE MINISTER OF STATE FOR FOREIGN AFFAIRS (LORD CHALFONT): My Lords, the Spanish Minister of Information stated on March 22 that the Spanish Government had decided to apply progressively certain clauses of the Treaty of Utrecht, which he said
"guaranteed Spain's defence against any possible attempt at expansion of the Gibraltar colonial situation."
This might foreshadow new restrictions. But the Spanish Government have not explained the statement or commented on
1226
various Press reports to this effect, and I do not propose to speculate either on their intentions or our own reactions. Our views on the question of frontier restrictions at Gibraltar have been made absolutely clear to the Spanish Government.
LORD MERRIVALE: My Lords, I thank the noble Lord for his reply, but as a new situation would appear to be emerging, would the noble Lord be prepared to reaffirm the assurance made by the noble Lord, Lord Beswick, on July 27, when he said:
"If the economy of Gibraltar were to suffer further restrictions, we should then confront a new situation which Her Majesty's Government would then consider, in close consultation, as is customary, with the Government of Gibraltar"?—[OFFICIAL REPORT, 27/7/67; col. 1318.]
Should there be new restrictions on April 15, would Her Majesty's Government implement the assurance of the noble Lord, Lord Beswick?
LORD CHALFONT: My Lords, of course I reiterate what my noble friend said on that occasion, but I think it would be unwise of me, as it always is unwise, to comment on what would be the action of Her Majesty's Government in a hypothetical situation.
LORD ROWLEY: My Lords, may I ask my noble friend whether he will make clear that the Government do not accept the interpretations which are apparently put on the Treaty of Utrecht by the Spanish Government and that if the Spanish Government insist on implementing their own interpretations, the responsibility for the consequences will rest entirely upon the Spanish Government?
LORD CHALFONT: My Lords, I am in considerable sympathy with what my noble friend has said. We have already made it plain on a number of occasions, most recently at the talks which took place in Madrid last month, that we regard restriction at the Gibraltar frontier as completely unwarranted. But I think that our action in this matter should be, as it has been in the past, to keep open our offer to submit the specific question of Spain's legal obligations about the land frontier to the International Court of Justice and to independent adjudication.
LORD MERRIVALE: My Lords, does the noble Lord not think that this is just

1227
wishful thinking, hoping for something impossible, when as a result of the failure of these discussions the official comment on the part of the Spanish Government was that the only thing Her Majesty's Government were interested in was the question of better facilities regarding the use of the British military base, without taking into account the interests of the people of Gibraltar? Does that not appear to be a curious official comment on the part of the Spanish Government after the breakdown of these talks?
LORD CHALFONT: My Lords, it is up to the noble Lord to place his own construction on the comments he has heard and on reports in the Press. I can only say that from our point of view we have had no official comment from the Spanish Government upon the Press reports and we have had no gloss placed on anything that has been said by them since the talks in Madrid. I can only reiterate that we do not accept that Spain can justifiably prevent communications that have been allowed and exercised for over 250 years. But I think that the noble Lord and the House generally would agree that it usually is unwise in a situation like this to say what we would do if certain circumstances came to pass, when we do not even know that they are going to come to pass.

MALTA DOCKYARD
LORD BESWICK: My Lords, at a convenient moment after 3 o'clock my noble friend the Leader of the House will be making a statement about Malta.

CONSERVATION OF SEALS BILL [H.L.]
THE EARL OF CRANBROOK: My Lords, I beg leave to introduce a Bill to provide for the conservation of seals in England and Wales and Scotland, and in the adjacent territorial waters. I beg to move that the Bill be now read a first time.
Moved, That the Bill be now read 1a.—(The Earl of Cranbrook.)
On Question, Bill read 1a, and to be printed.

THE SHIPPING INDUSTRY
2.50 p.m.
LORD GEDDES LORD GEDDES rose to call attention to the shipping industry; and to move for Papers. The noble Lord said: My Lords, in drawing your Lordships' attention to the shipping industry I must first declare an interest, both as a director of a shipping company and as this year's President of the Chamber of Shipping of the United Kingdom. It is now just over eight years since this subject was last debated in this House. This in itself is an indication of the extent to which, in peace time, shipping is a forgotten industry, or at least one which is taken too much for granted, except of course during a strike of seamen or dockers, when the industry's services become all too conspicuous by their absence. Whenever on such occasions shipping is mentioned in public, words like "vital" and "lifeline" are freely and sincerely used. But it is not mentioned nearly enough in ordinary times, or in the right quarters.
There is a further justification for inviting your Lordships to consider this subject once more after so long a time, and that is the fact that a Committee of Inquiry are now examining the industry, under the expert chairmanship of the noble Viscount, Lord Rochdale, whom I am glad to see here in his place to-day. Perhaps I should make it clear that this time I shall confine myself to shipping, as distinct from shipbuilding. It is true that, in a sense, these are sister industries; but they are quite separate, and shipbuilding has problems of its own which have been widely publicised. Similarly, I shall not refer to another industry with problems of its own—the fishing industry. This has always been regarded as distinct from the merchant fleet, and is indeed quite different in terms of operation, ownership and the legislation which applies to it.
My Lords, eight years ago the outlook for British shipping, as many speakers then said, and as indeed I said myself, was black. The picture which I have to paint to-day is not one of unmitigated gloom, but rather of change: of great changes that have already taken place, and of more to come. At the time of the last debate world seaborne trade amounted to 970 million metric tons. By

1229
1965 this figure had increased to 1,600 million tons, and it is still rising. But a large part of this increase has been in the quantity of oil being shipped, which is now substantially greater than all other cargoes put together. This has had a profound effect on the structure of the world's merchant fleets, including our own. The world merchant fleet has risen over the same period from about 104 million to about 167 million tons gross. The fact that it has not increased at quite the same rate as world trade is partly because the newer ships tend to be faster, and partly because of the reduction in the number of ships laid up as a result of lack of employment. In January, 1960, there were 6¼ million tons laid up, including nearly 1 million tons of British shipping; in January of this year the world figure was down to 750,000 tons, including only nine quite small British ships, totalling 60,000 tons. But the most dramatic increase in ships' tonnage has been in tankers. The world's oil carrying capacity has risen during this period by well over half, and the ships themselves are bigger. At the time of the last debate, only 10 of the tankers on order had a deadweight tonnage of more that 100,000 tons—the first of many of the "Torrey Canyon" size. Now throughout the world there are already in service 30 vessels half as large again; and there are at least 170 of these under construction or on order, mostly in the 200,000 ton class, and including some of over 300,000 tons. In sheer size tankers have now taken the place of the passenger liner, and in far greater numbers.
Where does the British merchant fleet stand in all this? It has increased, but at nothing like the same rate as the world fleet, and it now stands at 20½ million tons gross. Its share of world tonnage, however, has fallen over these eight years from 19 per cent. to just over 12 per cent. This is a very different picture even from 1939, when we could claim 28 per cent. of the world's tonnage. We have in the past year lost our place at the head of the league table to Liberia; and although Liberia—in this context only, and with all respect—is a paper tiger, for ships under her flag are mostly owned either by American or Greek interests, we are no longer very far ahead of Norway and Japan, both of whose
1230
fleets have increased dramatically in the past few years.
There are many reasons for this relative decline, but the main one has been the switch from coal to oil as a source of energy. In 1913 we exported 77 million tons of coal, mostly in our own ships, well over twice the weight of our total exports last year, though of course only a fraction of their value. By 1938 the figure was down to half of this, and by 1967 it had dropped to less than 2 million tons. By contrast, our imports of oil and oil products have risen in weight by over eight times since 1938 to the present figure of well over 90 million tons. In these 30 years we have changed from being exporters of one form of energy to being importers of another, and on even a vaster scale. So it is not surprising that the pattern of our shipping operations, and the nature of the ships themselves, should have changed. It is significant, too, that the countries whose fleets have increased at a faster rate than ours are for the most part untrammelled by the demands and precedents of other industries.
Nevertheless, our shipping industry continues to play an unobtrusive but vital part in our economy as, in almost every sense, an invisible exporter It is sometimes difficult to grasp what those words mean, and perhaps an example might help. Last week, a 20,000 ton British flag ship of my own company brought a cargo of oil into London. She last sailed from a British port in December, 1962. During these 5¼ years she steamed over 390,000 miles or, to put it another way, she carried roughly 8 million ton-miles of cargo, and always in the so-called cross trades far away from home. She has been truly an invisible exporter during the whole of that time.
The net contribution of United Kingdom shipping to the balance of payments is about £140 million a year, or a quarter of the whole of our invisible earnings. But this is not the whole story. British ships help to carry our own exports and imports, and if there were no British ships the net cost to our balance of payments would be of the order of £300 million a year. The industry achieves this result on a dangerously narrow margin of profitability, though this is characteristic of shipping throughout the world. According to the Economist, the overall return

1231
on capital employed by United Kingdom shipping companies in 1967 was a mere 0·9 per cent.; and a report on European liner operations not long ago suggested that an increase of 20 per cent. in freight tariffs would be needed to ensure a reasonable return.
There are, of course, times when at least some types of shipping enjoy a boom, but the lean periods in between tend to be protracted. In spite of this, our fleet has been transformed, and for the better, in the past few years. In the last debate, the noble Viscount, Lord Runciman of Doxford, concluded by saying:
"If we have not in the years to come to the same extent the biggest mercantile marine in the world, at least let us try … to have the best."—[OFFICIAL REPORT, 3/2/60; col. 925.]
The first part of that is already true. We have not yet quite succeeded with the second—for example, our ships are on average slightly older than those of Norway and Japan—but we are well on the way towards it.
The most obvious change has been to fewer but larger ships—from just over 3,000 to slightly under 2,200, but with an average tonnage of just under half as much again. Conventionally, our fleet is divided into three main classes of ship—liners, tramps and tankers—and each of these, in turn, into ocean-going, which is much the larger part, and coastal. Liners are those ships which ply on fixed routes to fixed schedules, like buses, and the great majority of them are concerned wholly or mainly with cargo, including refrigerated cargo. Because of the withdrawal of so many passenger liners, as a result mainly of competition from the air, the tonnage of ocean-going liners as a whole has decreased, and now represents about 42½ per cent. of the whole oceangoing fleet, compared with 52½, per cent. eight years ago. This trend will be accelerated by the emergence of container ships, a specialised form of liner of which I shall have more to say later.
The next group, the tramps, are rather like hire-cars, in that they can be chartered either for a single trip or for a period, though the latter is becoming more usual. Their tonnage has increased a little in these eight years, and now represents 20 per cent. of the ocean-going
1232
fleet, but they include an increasing proportion of the large new ships known as bulk carriers, which are used for such commodities as iron ore. The third group, the tankers, are owned mainly by the oil companies for the transport of their own raw material or products. Their numbers have fallen by about a third, but their average tonnage has doubled, and their proportion of the ocean-going fleet has risen from 30 per cent. to 37 per cent. The contrast will be still more marked in two or three years' time. At the beginning of 1960 there were only four United Kingdom owned and registered tankers with a carrying capacity of more than 40,000 tons; but of the 200,000-tonners that I have mentioned as being on order to-day, 25 at least will form part of the United Kingdom fleet of to-morrow. So much for the oceangoing vessels.
The coastal and short-sea fleet, on the other hand, has declined both in number of ships and in total tonnage, as a result largely of the continued falling away of the seaborne coal trade. Although there is the same trend towards larger vessels, this is limited by the capacity of the ports and the terminals to which they trade. These broad divisions tend to conceal the emergence of highly sophisticated types of new ship, such as roll-on, roll-off ships in the short sea trades, methane carriers and bulk chemical carriers, oil-rig service craft, and so on. These are all evidence of increasing specialisation, and they bring me back to the most revolutionary of the specialised vessels of to-morrow: the big container ships which will soon begin to take over the role of the conventional cargo liner in the deep-sea trades. The revolution here is not so much in the idea of pre-packing cargo in enormous boxes of uniform size, instead of stowing it in the holds of a ship item by item or bale by bale; it is in the concept of through-transport from inland depot to inland depot, with the minimum of handling and delay at the ports and with a single operator responsible for the entire movement.
Britain is often accused of having bright ideas but failing to exploit them. Here the reverse is the case: we cannot claim to have invented containers, but we have seized the opportunity they offer and are developing the idea further and on a larger scale than anyone else. Next

1233
year, in addition to existing short-sea container services and to transatlantic services operated by British and foreign shipowners in collaboration, nine specially-built ships will come into operation on the Australian run, doing the work of fifty or more conventional cargo liners. It may not be long before the principle is applied to other routes where the volume of cargo justifies the very heavy capital investment.
I propose to touch only very briefly on the all-important human aspect of these changes. Bigger ships, with sophisticated equipment, mean, ton for ton, smaller crews. Since the last debate, the number of United Kingdom-domiciled seafarers has fallen from about 140,000 to about 110,000, and it must continue to fall as the industry becomes more and more capital-intensive. At the same time, the modern officer or rating is becoming increasingly professional and versatile. Higher standards of entry are being set, and more and more emphasis is being placed on training at all levels. The recent introduction of degrees is one example, and the opening last year of the magnificent National Sea Training School at Gravesend is another. One extremely interesting development is the gradual and planned breaking down of the traditional divisions between deck and engine room, and even between them and the catering department. The master of a ship and his officers are coming to be regarded as managers, and increasing use is being made of work study and other management techniques.
These developments bring new responsibilities. One of them is safety, and perhaps I may touch briefly on tanker safety, since I have been particularly concerned with it. In so doing, I can hardly avoid mentioning the ill-fated "Torrey Canyon". This was an incident of the most unlikely kind, and the result of sheer ineptitude. But it happened, and it has been followed recently by two further incidents with similar results on the other side of the Atlantic. As I have pointed out, the world has come to rely for its energy mainly on crude oil, and in doing so it has exposed itself more and more to a new kind of hazard, the extent of which we have realised only gradually. A great deal of work needs to be done, and is being done, to minimise this hazard. But cool judgment is
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required where restrictive measures are concerned. It would be wrong for example, to be panicked into restricting the size of tankers. Collisions are a greater risk than strandings, and fewer and bigger ships, provided that they meet the highest standards of manning, actually reduce the chances of collision. Above all, in an international industry like shipping such measures must be concerted internationally. Not only is it pointless and dangerous to have ships of different nations obeying different rules, but it is also merely quixotic and economically suicidal to impose on one's own ships restrictions from which those of other flags are exempt.
Possible measures arising out of the "Torrey Canyon" episode, such as recommended sea lanes, are being thoroughly worked out by the Inter-Governmental Maritime Consultative Organisation. This United Nations organ could easily have become a forum for mere sectional theorising, but in this case it has shown itself to be a well-balanced and powerful instrument with considerable potential for the future. I only hope that IMCO's work will not be undermined by hasty unilateral action by the United States as a result of the recent incidents, and, more generally, that it will resist the temptation of reaching out too far into fields of responsibility which are the province of established institutions, such as the classification societies in the field of ship design.
It is somewhat ironical that Britain should have been the first sufferer from a discharge of crude oil on the "Torrey Canyon" scale, for we have taken the lead in promoting international agreement to limit the far more common cause of oil pollution, the discharge of wastes after tank washing, and a British tanker company has developed a system, which is now widely adopted, which eliminates practically any discharge at sea at all. We have also our own tanker safety code for the avoidance of fire and explosion, which is now being adapted for international application, and is to be followed by a similar code for the carriage of bulk chemicals. Only last September tanker owners from all over the world met in Brighton to exchange information on the causes of casualties. And, although this is my special field, there are similar developments in other trades. It may well be that the time is not far off when it will

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be necessary to reach international agreement on at least the minimum qualifications for those who are entrusted with the command of ships which may enter the harbours of any nation in the world.
In a commercial sense, shipping the world over is peculiarly vulnerable to factors outside its own control. Some of these are quite unpredictable, like gluts and famines: others result from the actions of Governments, including our own. One example has been the closure of the Suez Canal for the second time in a dozen years, with 15 ships, including four valuable British liners, bottled up inside it for the past ten months. The disturbance to the pattern of trade has been profound during this period, and the cost has been heavy to shipowners and consumers alike. One thing is certain: if and when the Canal reopens to shipping of all nations, as of course we all hope it will, it will never resume its old importance. Before last year's hostilities just three-quarters of the Canal's revenue was from tankers carrying crude oil from the Persian Gulf to Europe and returning in ballast. The largest vessel which could traverse it fully loaded was about 70,000 tons dead weight; but the Canal authorities had laid plans for straightening and deepening it to take a 200,000-tonner by about 1975. But at last year's level of Canal dues it would already have been more economical to take a loaded 200,000-tonner, a number of which were by then on order, round the Cape. Now, with the uncertainty about the future of the Canal, many more vessels of this class have been ordered, with the result that by the early 1970s there will be sufficient of them in service to carry all the oil that used to go through the Canal. The flow of oil through the Canal to North-West Europe may well be reduced to a trickle; and it is by no means certain that the big tankers will want to use it even if, and when, several years later, it is deep enough to take them. If meanwhile the Canal dues are increased, to compensate either for this loss of revenue or for the cost of deepening, they may become prohibitive even for a large proportion of dry cargo ships, including the new container ships. It will be a sad thing for everyone if the Canal, which has been of such profound service to trade and humanity for a century, should fall into disuse; but it could happen.
Then there is the deliberate action by foreign Governments in restraint of trade. Much was said during the last debate about flag discrimination and cargo preference—devices by which certain nations reserve a proportion of their trade for their own vessels. These practices, often associated with subsidies, are kept within bounds only by endless negotiations on the part of British and European ship-owners and their Governments. Again, some nations encourage the use of flags of convenience, which enable their nationals to enjoy tax concessions and other benefits which they could not and would not enjoy under their own flag. Finally, there is increasing interference, most strikingly by the United States' Federal Maritime Commission, in the pricing mechanism; and arbitrary criteria are being opposed to the free play of market forces.
A new factor since the last debate is the emergence of the United Nations Conference on Trade and Development, which has an active Committee on Shipping. The underlying purpose of this organisation, to help the developing countries to help themselves, is unexceptionable; but where shipping is concerned it tends to takes the form of encouraging the growth of national fleets, in part at least for reasons of prestige and with insufficient regard to commercial realities. This could lead to uneconomical services driving out the established ones and leaving the country concerned with a liability rather than an asset, in spite of cargo preference. There are several cases where improvement of port facilities would reduce or stabilise the cost of the existing services and be a much better investment in the long run.
Our vulnerability is equally marked where the actions of our own Government are concerned. The effects of devaluation, for example, are by no means clear, but a very high proportion of the disbursements of British shipowners is in non-devalued countries; and many owners face substantial additions to the cost of ships they are having built abroad. So far as taxation is concerned, the industry has enjoyed the benefits of free depreciation. At the same time, however, there was the change in the basis of company taxation, which has largely nullified those benefits. In a very different field, ship-owners are gravely concerned at the im-

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pending withdrawal of the Navy from East of Suez, believing that all kinds of lawlessness may develop without the often unseen presence of the "policemen on the beat".
In the last debate the noble Earl, Lord Jellicoe, referred to "an increasing need for a real and fruitful partnership between industry and Government". A partnership of a kind has existed between the shipping industry and the Government for much longer than with most other industries. It has always been friendly, but at the present time it is not, I believe, as fruitful as it could be. Although the Government usually appreciate the special problems which we have as an international industry, they are not always successful in taking up the cudgels for us against other Governments whose approach is more restrictive.
In other spheres, particularly where the Ministry of Transport is involved, our relations are less harmonious. In recent months the Minister has taken two major steps without apparent regard for their effects on shipping. The first is the proposed nationalisation of the ports. This, we believe, is a purely doctrinaire decision, and one taken at the worst possible time. The second is the Transport Bill, which could affect shipowners in two ways. First, it would restrict our customers in their choice of inland transport, and this is of special importance with the through-transport of containers. Secondly, the massive support accorded to the railways cannot fail to have an adverse effect on coastal shipping. According to the White Paper, The Transport of Freight, the Government
"recognises the contribution which coastal shipping can make to the national transport system and accepts the principle that competition between coastal shipping and the railways must be fair."
But the effect of the Transport Bill is to nullify the safeguard, such as it is, provided by Section 53 of the 1962 Act; and it is difficult to see how competition can be fair when one competitor is given orders, and resources, to secure traffic regardless of specific comparative economics.
My Lords, I hope that I have painted a picture of an industry which is at once vital, virile and vulnerable. Vital, in the sense that our balance of payments would
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be in a far more parlous state without it; virile, in that it is responding promptly and positively to changing pressures and demands; and vulnerable, in that it is subject to a greater array of unpredictable external factors than any comparable industry. My plea is that Governments of this country, of whatever political colour, will, by paying special regard to the industry's special problems, help to add yet another "v", for viable. My Lords, I beg to move for Papers

MALTA DOCKYARD
3.20 p.m.
LORD SHACKLETON: My Lords, with permission, I should like to acquaint the House with the present position in relation to the talks with the Prime Minister of Malta about the Malta Dockyard which were concluded last Sunday. These talks were essentially concerned with the financial help which the Malta Government sought in respect of certain proposals which Dr. Borg Olivier will be making to the Malta Parliament in the next few days. These proposals will have the effect of ensuring the continued operation of the Dockyard and will enable it to be developed for the benefit of the Maltese people and for fill who work in the Dockyard. This is of the utmost importance for Malta and, I believe, for relations between our two countries.
The House will understand that until the proposals of the Malta Government have been made public in Malta it is not possible for me to make any detailed statement on this subject. I thought it right, however, to inform Parliament that the talks last week about the contribution which the British Government could make to a settlement of this problem were entirely successful. I hope to be able to give the House the details in a further Statement before the Easter Recess.
EARL JELLICOE: My Lords, I should like to thank the noble Lord for making this Statement and making it in your Lordships' House, and to congratulate him on this agreement. At least I am virtually certain that I should be congratulating him, although until we know the details of the settlement it is of course difficult to comment on it. In any event,

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I am sure that your Lordships admire the strenuous efforts which the noble Lord the Leader of the House, not for the first time, has deployed in extremely difficult international negotiations, and this time I think the diplomatic talents of the noble Lord have been employed to an end which commands wider assent in this country than last time. We all gladly acknowledge our great debt to Malta and its people, and many of us feel that hitherto that debt has not been adequately discharged. Knowing the importance, as I do, of the Malta Dockyard to Malta, and subject to more knowledge of the facts of the settlement, I am sure that I am speaking for my noble friends when I say that we are very glad that it has been possible to reach this settlement.
LORD BYERS: My Lords, I should like to add my thanks to the noble Lord for making this Statement in the first instance in this House, and to congratulate him very sincerely indeed on what we believe he has achieved in these negotiations. I hope that it may give a stability to the Dockyard which will inspire the confidence of the potential users of the Dockyard and help the economy of Malta in a very big way. The noble Lord will then be able to take great credit for what he has achieved.
LORD BROCKWAY: My Lords, joining in the congratulations to my noble friend, may I ask him whether, in these negotiations, any estimate has been made about the degree of unemployment which there will be in the docks, and of any alternative development in Malta which will provide for those who become unemployed?
LORD SHACKLETON: My Lords, I am most grateful to all three noble Lords—to the noble Earl, Lord Jellicoe, and the noble Lord, Lord Byers, especially—for their kind remarks. I would echo what the noble Earl said in regard to the feelings that we in this country have for Malta. This is a feeling which I strongly share, and despite the somewhat arduous nature of the negotiations my affection and admiration is certainly in no way diminished. I very much regret not being able to give the House much information at this stage. Your Lordships will appreciate that this is very much the responsibility of the Malta Government. There
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is always the possibility of legislation in Malta, and it would therefore be wrong to go into details. Any picture I could give at this moment of our contribution would be incomplete without the whole details.
I may tell the noble Lord, Lord Byers, who I realise has recently established a degree of residential status in Malta, that his prospects will also be excellent in the future. All noble Lords are of course concerned about the possibility of the solution of this problem. Let us not minimise the fact that difficulties do lie ahead, and not least in the Dockyard itself, but on the wider question of employment it is not for me now, or indeed for the British Government, to comment on the prospects actually within the Dockyard beyond saying that we hope that, with efficient management—it is a very fine dockyard indeed—it will become more prosperous. But of course the British Government have taken a number of steps—for example, the appointment of the Robens Mission—to assist the Malta Government in regard to diversification and other activities. This is part of a wider problem, one that is also associated with the run-down. So I fear that, without going into it at greater length, I can give no answer to my noble friend Lord Brockway beyond saying that while in the wider context of run-down his remarks are very relevant, we are hopeful that there, too, good progress will be made.

THE SHIPPING INDUSTRY
3.27 p.m.
Debate resumed.
THE MINISTER OF STATE, BOARD OF TRADE (LORD BROWN): My Lords, I am grateful to the noble Lord, Lord Geddes, for having given us the opportunity of debating such an important subject as our shipping industry, and for setting out for us so lucidly the changes which have taken place and are still taking place in the industry and in sea transport as a whole around the world. There can never have been a time when there were so many, and such fundamental, changes in the techniques of sea transport over comparatively few years. The only possible paralled could be the period just over a hundred years ago, when the iron, screw compound steamer gave man the power to carry

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paying cargo at will almost to the ends of the earth, without being at the mercy of winds and water. It is therefore very salutary that we should have this debate at this time. I believe the noble Lord, Lord Reith, once remarked,
"Let us get the facts straight before we all begin distorting them."
Lord Geddes has set out the situation very objectively and I am grateful. The noble Lord also, early in his speech, stated his intention to confine his remarks to shipping. For this, too, I am grateful, because the Government are well aware of the problems of the related industries of shipbuilding and fishing; but shipping is by itself a subject of great range and complexity, and I am sure it would only detract from your Lordships' consideration of it if we were to try to extend the debate to these other industries as well.
I will not seek to put any gloss on the very interesting and detailed description which the noble Lord, Lord Geddes, has given of developments in world sea-borne trade and world shipping, and the relative position occupied by our own merchant fleet. Many, of course, deplore the change in its position from 28 per cent. in 1939 to 19 per cent. in 1960 and 12 per cent. to-day—just over that figure—but, as the noble Lord has pointed out, the circumstances of world seaborne trade have changed greatly over these years, and there is a case for saying that these changes have been almost inevitable. What is more important than pure size is profitability. However large a merchant fleet, it risks becoming a burden if it is not profitable. At a later point the noble Lord referred to the impact of taxation on the industry, but the Government's attention to this issue is of limited value to the industry if it is not making profits. If you do not earn profits, you do not pay much in taxes, and the benefits arising from tax relief where these are appropriate is correspondingly reduced.
Let me stress at once that the Government are in no doubt about the true nature of the contribution which the shipping industry can and is making to invisible exports and the balance of payments. In the course of his speech the noble Lord gave the net contribution of the United Kingdom shipping industry to the balance of payments as about £140 million a year. That was the figure for
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1966. For 1967 the latest estimate is that this contribution will have risen to £246 million, due to higher freight rates and earnings mainly from tankers. I believe this sharp increase is not yet public knowledge, and clearly the industry is to be most heartily congratulated.
The whole of the industry's net earnings contribute visibly in our balance of payments. This was one of the considerations which influenced the Government when the corporation tax system was introduced to include in the 1965 Finance Act a provision which allows the shipping industry to write of fully their new ships for tax purposes against profits at any time after they are acquired. This is known as free depreciation. In saying that corporation tax nullified the benefit of free depreciation it seems to me that the noble Lord is to some extent putting the cart before the horse. I suggest, too, that we should consider the fiscal position of the shipping industry in all its aspects. Shipping was not the only industry affected by the change to corporation tax, but only the shipping industry has the privilege of free depreciation. Moreover, under the Industrial Development Act investment grants are payable in respect of ships. Previously ships qualified for investment allowances along with all other manufacturing and transport equipment, although at a higher rate, but now that these allowances have been abolished ships are the only form of transport equipment, apart from certain specialised vehicles and port equipment which qualifies for investment grants. If the shipping industry's profitability were to improve, which we sincerely hope it will, then the benefit of free depreciation might be much greater than it is at present. With all these arrangements the industry may well find as its profits improve that it is better off under corporation tax than it would have been under the previous arrangement.
The noble Lord has referred to the activities of foreign Governments in restraint of shipping and has suggested that we have not been tough enough in trying to secure the limitation of these actions in the interest of our own shipping industry. Many noble Lords in this House will be aware of a problem which frequently arises over inter-governmental discussions. A very tough line may in

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fact be taken by our negotiators, but because such negotiations are essentially confidential those affected by their outcome in the United Kingdom are often left to assume that too little has been attempted in defence of their legitimate interests. I am not saying that we are always sufficiently tough, but I think that often we are a good deal more trenchant than is accepted as being the case.
There is no doubt that the practice, for example, of flag discrimination causes grave concern to shipowners and that the extension of it could be damaging to the shipping industry and to its contribution to the balance of payments particularly, because over 50 per cent. of the earnings of United Kingdom shipping is derived from the cross trades. In conjunction with other maritime nations we have consistently and vigorously opposed the practice, and at the recent UNCTAD Conference we were able to secure the withdrawal of a resolution which would have condoned the use of it by developing countries. At the same time it must be recognised that the effect so far of flag discrimination on world seaborne trade overall is small, and the same is true of the seaborne trade of the United Kingdom. In recent years our imports have amounted to about 157 million tons, of which a little over 60 per cent. has been carried in foreign ships, but the greater part of this was in bulk commodities of which oil was the most prominent; and the amount of all this trade which was affected by flag discrimination was indeed small. Nevertheless, we recognise that the extension of flag discrimination must increase the cost of transportation both for the countries which practise it and for their trading partners.
The Government are well aware also of the difficulties which the Federal Maritime Commission's regulations can create for British shipping. Shipowners are compelled to dissipate time, effort and money in coping with the requirements of United States law, although they are, of course, no worse off in this respect than their competitors, including United States shipping lines. And in addition to the commercial implications, there are difficulties of jurisdiction and International Law. Her Majesty's Government and the Governments of many other countries
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have on many occasions pointed out very firmly indeed that some of the functions which have been committed to the Federal Maritime Commission cannot be carried out without encroachment on their own national jurisdiction. I hope that in the last year or so we have achieved reasonable working arrangements on a number of issues. I believe that British shipping would have found its position even more irksome had it not been for the sometimes very rigorous work which goes on through diplomatic channels. I can end on this matter only by saying that there is no easy solution to this problem, as the noble Lord knows only too well.
I have noted comments made about the threatening danger of oil pollution, with which, of course, the Government entirely agree. We are pursuing the matter with vigour through the Inter-Governmental Maritime Consultative organisation. I know of the interest in this matter of the noble Earl Lord Jellicoe, as Chairman of the British Committee.
The noble Lord referred to the human aspects of the remarkable developments which are now affecting shipping and indeed transport in all its spheres. It is difficult to exaggerate the importance of coming to grips with the problems which these cause. Nearly every new technical development means that fewer men are required to do the same amount of work, while those who are still required have to be ever more professional and versatile. Unless we can find satisfactory solutions to these problems it is no exaggeration to expect that the benefits from the new technical developments may be lost or almost entirely nullified. We have, in the first place, to see that as far as possible the problems created by the falling off in the numbers required, whether as seafarers or elsewhere in the shipping and transport industry, do not take us by surprise. It is just as important to plan ahead in manpower as it is to plan for investment and marketing.
Secondly, we have to see that the opportunities presented by new techniques and labour-saving devices, whether manifested in the size of ships or automated control systems or in new methods of cargo handling, are not frustrated by out-of-date anachronistic management-labour relations, unreal industrial agreements, bad methods of remuneration or by Government regulations which fail

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to take account of the changes that are taking place. The whole question of the conditions under which seafarers serve, and the relations between seafarers, shipowners and the Board of Trade in so far as it has responsibilities for these matters, were very fully covered in Lord Pearson's Report, which was published at the beginning of last year. The recommendations in that Report have been generally accepted by all the parties concerned; and the Board of Trade, in consultation with the seafarers and shipowners is now developing proposals for the legislation which the implementation of Lord Pearson's recommendations require.
We are a nation which tends to under-emphasise the need constantly to analyse and reform the many varied social and administrative institutions through which we administer our affairs in the realms of government, the law, commerce, industry and elsewhere. Unfortunately, in some ways I think this is a general characteristic of our society. The wind of change is now blowing through the industry, and we should all hope that our love of tradition, which is so easily but falsely translated into a love of carrying on with out-dated practices, will not prevent the many changes which are so essential to match the rapid technological changes in the shipping industry. It would be unfair to finish that comment without acknowledging the bold innovations which some companies in the industry have already introduced.
The noble Lord made a plea for a closer partnership between the shipping industry and the Government in terms which were just a little reminiscent of the early stages of a take-over bid. He then went on to list some of the directions in which present Government policies are not wholly acceptable to the shipping industry. He mentioned first the proposals for the nationalisation of the ports. I know he is opposed to the policy of my right honourable friend the Minister of Transport in this regard, but I am sure he would not wish to complain of any lack of candour or fairness on her part. The Chamber of Shipping was invited to comment on the Government's provisional proposals, and he and other representatives of the Chamber received a fair hearing from the Minister of State when they gave him their views—views which the Government were most glad
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to receive and which they have studied most carefully.
The noble Lord suggested that the reorganisation of the ports is being undertaken for doctrinaire reasons. This is a field in which I can claim to speak from a little personal experience First, as a Minister concerned with exports I am besieged with complaints of slow passage of goods from factory to overseas customers, and there is no question that our manufacturers are in many cases entitled to expect a faster movement of goods through many of our ports. Secondly, as Chairman of the National Modernisation Committee for the Port Industry, I have learned much of the administrative, managerial and labour situations in the ports. Nobody who read the Devlin Report could deny that they have been completely out of date. Whilst it is fair to point to the devoted efforts of both employers and trade unions which led at last to the elimination of the curse of casual labour and of a drastic reduction in the number of employers, brought about voluntarily by them, it is clear that these changes were long overdue and that the industry would have done very much better had they been introduced by joint agreement at a much earlier date.
In the light of all the changes in the physical nature of the ports and of the new methods of handling cargo which are already with us, it is clear that more and far-reaching changes will be essential. Bearing in mind all the difficulties; which have held up essential reforms in the past, it is now clear that planning and policy must be guided on a national basis in future. The noble Lord, Lord Geddes, must excuse me, but his use of the term "doctrinaire" stings me to a retort. Nationalisation is simply one form of organisation, to be used only in circumstances where it seems to the Government in power best to suit particular circumstances. It is therefore one of the organisational options available for consideration and, with great respect, it is those who decry its use in any circumstances who are the doctrinaires, net those who use it with discrimination where it seems to be appropriate.
The noble Lord also referred to two respects in which the Transport Bill will raise difficulties for the shipping industry.

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I acknowledge that this is a tortuous problem, but I find some difficulty in accepting that the licensing provisions in the Bill will mean any appreciable restriction on the use of road transport by shipowners. The quantity licensing scheme would not apply at distances up to 100 miles, except for certain bulk traffic, and recent research has indicated that a proportion of the order of 75 per cent. of exports originate within 100 miles of the port of shipment and that nearly all imports are delivered to the first consignee within the same distance. With great respect to the noble Lord, I feel that the anxiety he has expressed can be exaggerated.
The noble Lord has also suggested that there is nothing in the Transport Bill to secure that competition between coastal shipping and the railways will be fair, after the changes in the railway financial arrangements provided for in the Bill, and that my right honourable friend the Minister of Transport is somewhat blinded to the economic facts of life. I cannot let the noble Lord get away with that. Great industries come into being, rise and then sometimes fall in accordance with changing conditions. When liquidation follows, their assets are purchased for a fraction of their balance-sheet value. It was clearly not in the national interest after the last war to allow our railway system even to approach liquidation, and nationalisation followed, as it has in the railways systems of most countries since the advent of the motor vehicle. But British Railways have since carried on their back—as a result of valuing their assets not on the basis of the motor age in which we now live, but on compensation terms—an uneconomic burden of debt which has distorted their competitiveness. Deficiency payments have therefore had to be made. It makes economic common sense that they should be relieved of their debt burden and that deficit grants should cease. It is only by such a change that an equilibrium between rail transport and coastal shipping based on fair competition can be achieved.
The pressure on British Railways to break even in the future will be a powerful discipline that future operations will be conducted on a strictly commercial basis, for they will no longer be able to
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cut rates on the expectation that a deficit will be met by Government grant. I cannot, however, leave the subject without commenting that, in spite of what I have said, the Government note and understand the anxiety of many of our coastal shipping companies, and that the representations recently made by the noble Lord, Lord Geddes, to both the Ministry of Transport and the Board of Trade are currently being given serious consideration.
My Lords, I hope I have left no doubts that the Government are fully alive to the immense importance of our shipping industry to the nation, both as an earner of invisible exports and for the regular service which it provides for our traders to and from all quarters of the globe. I apologise for having spoken for too long, but I shall be attempting a reply later to some of the many points which no doubt will follow from other noble Lords who will take part in the debate. I also look forward to hearing the maiden speeches of the noble Lord, Lord Hill of Wivenhoe, and the noble Lord, Lord Somerleyton. Perhaps it will be some compensation to your Lordships for having had to listen for rather too long to me in this contribution that, by covering as much ground as possible, I hope to render my later effort rather shorter than would otherwise have been the case.
3.45 p.m.
THE LORD BISHOP OF LONDON: My Lords, I should like to begin by expressing my apologies to the noble Lord, Lord Geddes, for the fact that, owing to a slight miscalculation of traffic conditions South of the Thames, I was not present during his speech. We are grateful to the noble Lord for initiating this debate on this very important subject which should be the concern of all who live in these Islands, whose prosperity must continue to depend upon the maintenance and improvement of our heritage as a maritime nation.
My only reason for speaking in this debate, which I am sure will range over a large number of technical questions, is a concern—which I know is shared by all your Lordships—for the men who man our ships. In the last resort, our Merchant Navy will depend not merely on technical improvements, but on the quality of our sailors and the satisfaction which they find in their calling. The

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right reverend Prelate the Bishop of Winchester will, I understand, be dealing with this aspect also, and I hope not to anticipate the points which he will make.
The Church's concern, as far back as one can discover, has been with the pastoral and charitable aspects of maritime affairs, even though early maritime law seems to have a distinctly ecclesiastical flavour. In this pastoral concern my predecessors in the See of London seem to have been rather specially involved in the choice of licensing of ships' chaplains, and probably from that fact the parish church of St. Dunstan, Stepney, has had a special responsibility for, and long association with, the registration of births and marriages at sea.
But that is in the past. We are now concerned with the welfare of seafarers, which involves their whole life while at sea and while they are ashore; and this must include also a concern for their wives and their children. This was realised, perhaps for the first time, when the British Mercantile Marine sank into a deplorable condition in the early part of the 19th century. The Governments of that period saw that safety at sea demanded a far more rigorous control of the training of officers, and thus a compulsory system of examinations for masters and mates was incorporated in the Merchant Shipping Act 1854. At the same time, private charity saw the need to provide for the well-being of sailors ashore. The Sailors' Home and Red Ensign Club, now in Stepney, was one of the earliest of its kind and still performs a most valuable service.
In the ports of the United Kingdom there were many local sailors' homes and clubs, and these were gradually joined with the Missions to Seamen, itself an official voluntary organisation of the Church of England, the British Sailors' Society, a non-denominational society and over the past forty years the Apostleship of the Sea, which is an official organisation of the Roman Catholic Church with its headquarters in Rome. Of course, other maritime nations have established their own corresponding charitable concerns, and we in London have the pleasure of acting as a host for a great many of them. Since 1936 the work of the voluntary societies has been supplemented by the Maritime Division of the International Labour Organisation
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and, in this country, by the Merchant Navy Welfare Board. I know from a great deal of personal experience the extremely valuable work done by these societies in caring for seamen w bore in ports all over the world.
But, as has been pointed out, the pattern of life at sea is changing very rapidly, and this creates new problems so far as the seamen are concerned. The bulk carriage of oil, involving the rapid turn-round of tankers at terminals, themselves often remote from cities, has called for new kinds of service to the tanker crews during their short time ashore. I have seen, for instance, a good deal of the work of the Missions to Seamen at the oil port at Pernis, near Rotterdam, and I know how much it has meant to, sailors and, perhaps most of all, to apprentices. But the growth of the container system, the bulk carriage of grain, oil and other products, may mean that before long an increasing number of merchant ships will have only a very short time in port. What will be the effect of this on the home life of sailors, and on the relationship between husband and wife? If we are to have an efficient mercantile marine it must clearly be a happy and a satisfied one, and this problem must be faced not only by the societies and by the companies which support the societies so generously, but perhaps also by the State.
Will the answer lie in having to change a whole ship's company after one or two voyages, or in residential provision for wives at the terminal ports? And, if so, who is to be responsible for that provision or even in provision for wives to said with their husbands—a step which will no doubt create other problems? We do not yet know the answer to this problem, but it is clear that the voluntary societies themselves must meet it by a much greater degree of association than has prevailed in the past. They must share facilities, especially where new ports are being built. There is no reluctance on the Dart of the societies to move into increasing co-operation, but they will need not only good will—and that exists without any doubt—but also increased support from the shipping companies, the Merchant Navy Welfare Board and the Government.
There are other rapid changes to which reference has already been made; which are affecting those who sail in ships—for

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example, the development of automation and the consequent reduction in size of a ship's company. These changes also will have their effect upon the attitudes of the seafarers themselves. Obviously, the profession of the sailor is becoming increasingly a highly technical one, involving not only specialised skills but also an increasingly integrated ship's company. The various nautical schools that are providing, with the shipping companies, for the training of navigating and engineering cadets, the training ships, and especially the National Sea Training School at Gravesend, are providing for the new skills demanded by the new conditions and new equipment.
I believe that something like £4 million a year is being, spent on training, but it seems that there is also a problem of wastage. I have been informed that, of approximately 600 boys assisted by the Marine Society to enter the Merchant Navy in the years 1962, 1963 and 1964, only 54 per cent. went on to obtain their Second Mate's Certificate; and the rest may well have abandoned the profession. Does this suggest that there is an increasing need for maritime service to be regarded as a profession, in the fullest sense; perhaps one which sets its own standards and regulates its activities?
There has been in recent years a significant movement in this direction, especially in the long-established work of the Institute of Marine Engineers. Obviously, this is a matter which sailors themselves, on the bridge or deck or in the engine room, must decide for themselves. But is there any doubt that the prosperity of British shipping will depend increasingly on a spirit of professional pride in all connected with it, and that this is something which the general public should understand and welcome and encourage? Something is being done by voluntary effort to increase what might be called the educational standard of seafarers, through the College of the Sea and the Seafarers' Education Service. Not much is known about this organisation, but the fact that it is necessary for it to buy not fewer than 1,000 books a week in order to keep ships' libraries stocked is an indication of the demand and of the possibilities for development.
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I have touched on only one issue—the well-being, satisfaction and pride of profession of our sailors. They are the concern of the industry and of the governmental agencies. I do not wish it to be thought that in anything I have said I have been criticising what is being done. Nevertheless, in this rapid change and development it should perhaps be realised more fully that the whole nation ought to be involved. The public should know more of the work of the mercantile marine, of the men who accept loneliness, isolation from family life, and still physical danger, as part of their contribution to this nation's well-being. For, my Lords, what they do here, and in other countries in whose ports they show the Red Ensign, they are in fact doing for the nation.
3.56 p.m.
LORD HILL OF WIVENHOE: My Lords, this is the first occasion on which I have had the pleasure of addressing this House, and I hope that I shall maintain the high standards which prevail. I want to congratulate the noble Lord, Lord Geddes, on his address to the House, which was, quite naturally, what I should call a typical shipowner's speech. As a representative of the trade union movement, I want to talk about our workers' side, because we look at the situation in a much more serious light than do some other people.
We must look back over the past to get the real history of this industry. We are not unmindful of the booms and slumps during the last century. The first slump we had in this century was in 1904, and it lasted until 1911; there was another from 1929 to 1939, and then there was the recent setback when there was a drop in tonnage of 6 million tons. Peculiarly, during the recession from 1904 to 1911 the tonnage of British shipping increased by 2 million tons, but in the next recession from 1929 to 1939 the tonnage reduced by 2 million tons. It may be argued, and perhaps correctly, that the 1929 to 1939 slump was more serious than the previous one, although there may have been other reasons for the reduction. Since the last war—and I remember that the noble Lord, Lord Geddes, said that the figure of 6 million tons laid up is now reduced to half a million tons—we have increased our

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tonnage by about 1 million tons, according to Lloyd's Register of Shipping.
But when I look at the Shipbuilding Inquiry Committee 1965–66 Report, which is known as the Geddes Report, I see with some amazement on page 39 that 25 per cent. of the shipping registered in Britain is foreign-owned. If that is true we must deduct from Lloyd's figure of 21·7 million tons the 25 per cent. which is foreign-owned, and then we find that there are only 16½ million tons of British ships. Since we had 19 million tons before the first World War, we are "down the drain" by nearly 3 million tons, and that is what the worker is concerned about. He can see the tonnage of shipping going down and down, and he wonders where it is all going to end—and of course I do, too—because there must be some day of reckoning for this. We cannot keep on going down when everybody else is going up.
Let me deal with the depression from 1929 to 1939. Here I must bring in other industries, not in the sense that I want to discuss their future but in so far as shipping affects other, feeding industries, like shipbuilding, marine engineering and, for that matter, the steel plate works in the steel industry. In the serious recession of the 1930s, while you had a certain number of unemployed in the shipping industry it was much more serious in the feed industries. In shipbuilding, unemployment went up to over 63 per cent.—the highest figure that any industry in this country has returned in the last century. In iron and steel, which was very much dependent on shipping, the number of unemployed went up to 51 per cent. It is difficult to say precisely what the marine engineering figure went up to because that is in the engineering industry, but in the engineering industry the figure went up to 35 per cent. This was colossal unemployment. So in these industries we are very much concerned, and we do not want to see it happen again.
Then there is another tendency when there is a recession. I am not going to blame all shipbuilders for this, but there are a number of shipbuilders who are rather irresponsible and who allow their ships to get into a bad state of repair. It was during the 1934–35 winter that the "Blairgowrie", "La Crescente", the "Usworth" and the "Millpool" went
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down, and when one reads the report of the inquiry into the loss of those vessels one realises that some British shipping was not up to the standard it ought to have been. I can understand some of this because of the economic circumstances. I know that very little profit was being made; and it is at such times as these that one has to ask for assistance from the Government, in order that we may maintain the high standards which are necessary. So we are concerned that this industry should be protected. At one time, of course, the shipowners were a law unto themselves, like the shipbuilders. They did not want anybody to interfere; and I can understand that to some extent. But there are times when you must have somebody to assist you, and I am sure that in tile future it will be necessary to have some assistance to overcome the difficulties.
Now let me look at the growth of the shipping industry. In 1914 we had 19 million tons out of a world fleet of 49 million tons—that is, approximately 40 per cent. of the tonnage at that time. By 1939 we had gone down to 18 million tons, which was 25 per cent. of the world tonnage at that time, which was 69 million tons. In 1967, if we take the Geddes Report as being correct, we find that we had 16¼ million tons, representing 9 per cent. of world shipping, which at that time was 182 million tons. During this period the world fleet increased by 375 per cent. It must be understood that when the workers see these figures produced and submitted to them, they are not pleased about the position. They are not pleased when they see the British mercantile marine fleet going down in tonnage year by year. If it is true that the British people own only 16¼ million tons, then we are in a very sad way, because we owned 19 million tons before the First World War. So the situation is a very serious one.
Let us look at what happened in other countries overseas during that period of growth in the world fleet and reduction in our own fleet. Germany, which is now a small country in comparison with before the First World War, has increased its shipping by only 9 per cent. That can be understood. But if you added the shipping of East Germany to that of the West German fleet, you would probably find that it had increased much mote. But

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let us look at all the other countries. France has increased its merchant fleet by 200 per cent.; Belgium and Spain by 250 per cent.; Holland, 300 per cent.; and the United States of America by 350 per cent. But if you take into account the 9 million tons of American shipping flying under 17 different flags, then they have increased their fleet by 500 per cent.
Denmark and Italy have increased their merchant fleet by more than 350 per cent.; Brazil, over 400 per cent.; Sweden and the Commonwealth, over 400 per cent.; Argentine, over 550 per cent.; Norway, over 700 per cent.; and Greece, over 900 per cent. But here again, if you add the 13 million tons of Greek-owned shipping which is carrying the flag of convenience, the total becomes 2,500 per cent. The last country, Japan, has increased its fleet by 950 per cent. How can workers in the industry be happy when they read these figures and see that when every other country in the world is increasing its shipping fleet we are going down? After all is said and done, I would not expect us to retain the 40 per cent. of world tonnage that we enjoyed in 1914. I would not expect us to retain even 25 per cent. of the world tonnage. But I would expect our fleet to increase above that of 1914. This is a very serious matter, and it is on this basis that the workers are very much concerned.
When we talk of growth, we have to ask ourselves why is it that these other people, these other nations, can increase their fleets in the way they have. Let me give one example. Norway, with a population of less than 4 million people, has 18·3 million tons of shipping. If shipping does not pay, how can a small country like Norway afford to have a huge fleet, bigger than that of this country, if, as I have said, the figures in the Geddes Report are right? It is very difficult to argue, "We are not so badly off, anyhow", because we are. I think we have to increase our fleet, not to the tonnage we formerly enjoyed, but to beyond what it is now.
May I look at another aspect of shipping? I have been dealing, by and large, with ocean-going shipping, but let me look at home trade and coastwise shipping. In 1939 we had 1,500 ships employed in this type of service, representing 1·7 million tons. In 1967 there were
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742, totalling 886,000 tons—a reduction of 50 per cent. If any of your Lordships go into our small harbours or up our rivers or alongside the jetties, you will be amazed at the number of foreign ships which are now doing the trade which we formerly enjoyed. It is really amazing that our home trade and coastwise shipping has slumped by 50 per cent. There are other figures here, too. In 1939 the number of foreign ships employed in our coastwise trade was only 1½ per cent.; to-day it is 25 per cent. These figures frighten workers. They say, "When are the foreigners going to take us over?"—because our fleet is going down and down. At some time or another we shall have to deal with that problem.
The other problem that worries the workers in the industry—and I am not speaking merely for seamen; I am talking about officers, too—is that they are very much concerned about these flags of convenience. I have said that shipowners who use a flag of convenience are rascals of the first magnitude. They do not make a contribution to the well-being of the sea or to the well-being of a nation. They are like mongrel dogs: they run round the world cocking their legs on everybody's doorstep, leaving other people to clean up the mess. I think it is appalling.
When, in 1958 or 1959, the workers in the industry put an embargo on ships carrying flags of convenience, we hoped that the shipowners would fall in behind and that the maritime Governments, too, would do so; because we had the workers in the frame of mind to tackle this problem. But instead of the Governments and the shipowners falling in behind the workers to solve this problem once and for all, all we got was a Geneva conference—where they said that there must be a genuine link between the owner and the State. You can understand now what the chances are of getting a mongrel dog to think about a genuine link. It is absolutely hopeless. Nobody has been able to decide, or at least to interpret, what is a genuine link. Nothing was done on that occasion. So what do we now see? We see that the number of ships carrying flags of convenience has increased by over 100 per cent. since that time. It is true that the Geneva conference frightened one Greek shipowner into putting some of his ships

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back under the Greek flag; but that was all. So to-day we have over 29 million tons of shipping carrying flags of convenience—more than double what it was only ten years ago.
At some time or another this problem must be tackled; for in ten years' time, if it is not tackled, there will be 40 million tons; in another ten years, 50 million tons; and, before we finish, the whole industry will be mongrel dogs. We cannot allow this to go on. I think it probable that the time has come when the workers will have another go at this. They are quite unhappy about it. They know it is bad for the industry; they know it tightens up competition; they know that when there are small profits, wages and merit money and so on are kept down; they know it is a menace to them. At some time or another the maritime Governments will have to deal with this problem. It may be that they will have to exempt shipowners from taxation, to put them on the same level as the owners of those ships which are carrying flags of convenience. In addition to exempting them from taxation they may even have to give them a subsidy, to drive the flag-of-convenience ships off the Seven Seas, to get ships back under their national flags, to become good citizens again. Only Governments can do that; and, sooner or later, it will have to be done. Otherwise our shipping industry will fall to pieces, as it has been doing over the past few years.
My Lords, I do not want to speak for too long. I hate long speeches; they are obnoxious at times, especially when there is some repetition. Let us look at the future of the shipping industry; for, after all, that is what the workers are concerned with. And one must appreciate this: you cannot get rid of ships and throw people out of work and expect them to be happy about it. When you look at some of the facts and figures which are brought forward day by day, when you remember that 62 per cent. by weight and 60 per cent. by value of oil imports into this country are brought in by foreign ships, then you know that we are in a bad way. The noble Lord, Lord Geddes, mentioned that manpower was down from 140,000 to 110,000. That 30,000 fall in manpower is not merely because to that extent our shipping has been rationalised,
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and probably mechanised and improved; that is not the full story. The reason why manpower has gone down from 140,000 to 110,000 is that British shipping has gone down in terms of tonnage. We have to pay regard to that.
We are of the opinion that the shipowners, like the shipbuilders, from time to time have been a law unto themselves. I mention this again because about eight years ago, I think, when Mr. Ernest Marples was Minister of Transport, I was on the Shipbuilding Advisory Committee. We tried to persuade him to give a subsidy to the shipping industry so that they could give us orders to build more ships. But when the shipping industry was offered a subsidy it was turned down. Why it was turned down I do not know. Nobody was more annoyed than the workers in the shipbuilding industry, who badly wanted to build ships.
Of course, when one accepts subsidies or Government assistance one must expect some public accountability. One cannot evade that responsibility. I do not suppose the Government would have interfered much in the running of the industry; but having regard to the worldwide situation in the shipping industry, you cannot get along without assistance from the Government. As the industry becomes more intensely capitalised you will get into further difficulties; and I see the day when ships—and now we are talking about 250,000-ton tankers—will be costing £6 million or £7 million apiece. As ships become more expensive you will not be able to afford them—as you did when they were of 10,000, 20,000 or 30,000 tons. You may have to get some assistance from somewhere.
I do not believe in the nationalisation of ocean-going ships; but I feel there must be some way to provide the shipbuilding industry and its servicing industries with a fair volume of work on a steady basis. I believe the time has come for the Government to look at the problem of building ships themselves, under the guidance of a shipping board, jointly with a shipbuilding board and the British Shipping Research Association, and chartering them to the shipping companies. By that method we might get a "scrap and build" policy that would give a steady flow of orders to the shipbuilding industry—which will suit the

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maritime engineering industry and the steel-plate workers. That is the kind of future I foresee; because I cannot imagine, unless we get rid of flags of convenience and cut some of the keen competition in the industry, that the shipping industry can give us the necessary ships to build and the necessary work to the associated industries.
I hope we shall look at this problem. I want to see the shipowners getting some assistance; I want to see more orders given to the shipbuilding industry to build more ships. I want all these things to happen and I sincerely hope that everybody will make a contribution and will try to see the light. If the shipping industry is in financial difficulties and it cannot replace its ships on a regular basis to suit the other industries, at least it ought to say so. And it should try to persuade the Government in the interests of all concerned to build the ships.
4.20 p.m.
VISCOUNT RUNCIMAN OF DOXFORD: My Lords, my first duty this afternoon is the extremely pleasant one of congratulating the noble Lord, Lord Hill of Wivenhoe, upon a well-informed and informative maiden speech, delivered with at any rate some of that vigour of expression which we have learned to associate with him in other places. I hope, as I am sure all your Lordships do, that he will give us the benefit of his views on many occasions in the future.
My second duty, my Lords, is to declare an interest in the shipping trade, in which I have been more or less actively engaged for something over forty years. This of course renders one liable to the accusation of being out of date, but at least it gives one some historical knowledge; and I should like, if I may, to put before your Lordships this afternoon one or two very general considerations in the most general terms about the economic situation of the shipping industry, partly in the world at large and particularly in this country, about which the noble Lord, Lord Hill, had a good deal to say. If I cover again in part some of the ground which has already been so ably covered by the noble Lord, Lord Hill, and by my noble friend Lord Geddes, I hope that your Lordships will forgive me.
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The first point that I should like to make is that, as has been said already this afternoon, British shipping is not, by comparison with a number of other British industries, a very profitable industry, certainly if profitability is expressed in terms of the return on the capital employed. If this were true of British shipping alone, there might be an explanation for it in the greater competition for investment which is exercised by shore-based industry; and it might be argued, of course, that it was due to some peculiar inefficiency in British shipping itself. But, in fact, I do not think it is true of British shipping alone; I believe it to be true to a very large extent, and within very much the same limits, of the shipping industries of nearly all the traditional maritime countries.
It is perhaps worth considering for a moment why this should be so. I think the answer is really quite simple. Shipowners in all countries are subject to very much the same costs in the running of their ships, costs which are mostly outside their control—bunkers, provisions, repairs, cost of building and depreciation on building, insurance and the like—so that as between one and another there is probably not much to choose. If, therefore, generally speaking they are unprofitable, the only conclusion one can reach is that they are unable to secure a sufficiently high level of freight rates to meet the costs which they cannot effectively reduce. I am afraid that this sounds very elementary, as indeed it is, because I think that in its essence the problem is extremely elementary. If, as I believe to be the case, the general level of freights in the world is too low to enable most of the shipping industries of the world to have a profitable existence on a strictly commercial basis, it is worth going a little further and trying to see why this should be so.
I think that there are two main reasons. One, and perhaps the less important, is that which applies particularly to ships whose freights are regulated by agreement and published in tariffs—the liner trades, in short, in general terms. Here one is more conscious than elsewhere of the influence of Government. In a great many parts of the world, in a great many trades, Governments repeatedly intervene to try to arrange the level of freight rates, and always in an attempt to get them down and not

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to get them up. I think that this is perhaps a reflection of the very common human characteristic, which we all share, that while we dislike very much paying more for anything, we mind much less paying more for something we can see than for a service that we cannot see. There is no doubt, curious as it may seem, that there are Governments in the world who will face with some equanimity an increase in the costs of their physical imports; who will be positively glad at an increase in the price which can be obtained for their physical exports, but who will resent quite strongly any attempt on the part of their national shipowners to raise the freights from which those shipowners make a contribution to the national economy. It is an extremely paradoxical situation, but I have met it too often in my own experience to disregard it entirely.
I do not think, however, that this is the main root of the problem. The real reason, in my view, why shipping freights have remained, with certain ups and downs, pretty consistently for quite a number of years at a level which is really below the true full cost of providing the service is, quite simply, that over the greater range of shipping—tankers almost entirely, bulk carriers, the tramps—in fact almost everywhere where there are not specific agreements, the rates of freight are determined by absolutely unrestricted bargaining on an unrestricted international market, and therefore move almost exactly, and very swiftly, as the supply of tonnage moves in relation to the demand for it. The truth is that, judged by this standard, over quite a number of years—I should say probably most of the time since the early 1950s —there has been more tonnage available in the world than the world at any particular time has needed to employ.
It is true that there have been occasions when this has not been so: there are always moments when there is some disruption of the general pattern. A notable example was the closing of the Suez Canal twelve years ago, and also, to a slightly lesser degree, the recent closing of the Canal this last summer. Such disruptions inevitably create temporary shortages, or local shortages, from which astute men can profit. But through and by, I think it remains true that there are more ships in the world than the world
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is able to digest. If this be so, one begins to wonder why the shipowners of the world at large should persist it spoiling their own market by over-supplying it.
What is it that gives rise to this whatever one may call it—this folly, lack of planning, or even sheer incurable optimism? I think that there are again two main reasons for it. One of them—not unimportant, though perhaps not the more important—is that, in the ordinary way, if people find they have to go on trading at levels of profit which do not enable them to keep their capital intact, or even to increase it, they will, sooner or later, be forced by sheer shortage of money to stop trying to acquire further capital assets. What has happened in recent years is that every shipbuilding country in the world, I believe without exception, has for the sake of its shipbuilding industry been offering terms of cheap credit to shipowners, whether domestic or foreign. This has he d the effect of removing the corrective of the shortage of funds which would otherwise have begun to operate.
It seems an odd and a sad thing to say that shipbuilding credits are the enemy of shipowners. I should not like to be responsible for so crude a statement in those terms; but there is a point here, and it is one which cannot be wholly overlooked. But, much more important, and more noticeable when one is considering, as the noble Lord, Lord Hill of Wivenhoe, did, the comparative decline, if not the absolute decline, of British shipping among the fleets of the world, is the fact that the shipping industries of very nearly every other country (indeed, at the moment I cannot think of any exception) enjoy advantages in one form or another which are not enjoyed to the same extent by the shipping industry of this country. That would seem to be a fairly clear reason why British shipowners should have been less anxious than their foreign rivals to contribute to an over-supply of tonnage in the world.
These advantages are of various kinds. Subsidy is perhaps the most obvious, as it is the crudest. Another is discrimination in various forms. The noble Lord, Lord Brown, referred to these, and I agree with him that of themselves they are certainly not the greatest, and I doubt

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whether they are the major, difficulty in this respect because their application is necessarily limited. Nevertheless, there are countries which seek, by one or other of these methods to increase their national fleets, for reasons not strictly related to the profit which these ships, when brought into existence, would normally earn in the free commercial market. One reason is prestige, the achievement of a sense of security, a sense, one might say, of dignity on the part of a number of emergent nations. Perhaps one of the strongest reasons is the use of their shipping services as a means of earning foreign exchange. Such countries are probably earning their foreign exchange in this way even if it means doing so at the expense of their home industries and taxpayers in other directions. I think it is possible that this is one of the reasons which accounts for the rapid growth of the shipping of Communist countries.
Other countries, notably Norway and Greece, give their shipowners important taxation advantages—more important, I think, than some of us sometimes realise, So, what with the subsidisers, the discriminators and the tax-benefiters, we are already up against quite a lot. When we add to that the problem of the flags of convenience, we are coming somewhere near to the root of the matter. I suppose that shipping is the only international industry in which a company, by carefully choosing the flag, the nationality under which it will work, can avoid paying any tax as a company, and in which the owners of that company, if they are intelligent enough in choosing their domicile, can further manage to avoid paying any tax on profits which they derive from the business. This state of affairs must inevitably give such companies and owners a competitive advantage that cannot be enjoyed by those in another country who are required, in greater or less degree, to make some contribution to the taxation needs of the land in which they live and have their being. The man who pays no tax will always be able to undercut the man who pays some tax, because he will not have to take that tax into account when he reckons up what he is ultimately going to get out of the exercise of his trade. I think that the matter is just as simple as that.
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I largely agree with what the noble Lord, Lord Hill of Wivenhoe, said. If British shipping is not to decline proportionately—even absolutely—still further in the world, it must be put in a position in which it can get at any rate some of the advantages employed by its foreign rivals, or something like equal terms. I do not think (here I would differ from the noble Lord) that this can be effectively done by subsidy. Subsidy is in itself a bad thing. It is enervating; it always tends to reward the inefficient rather than the efficient. It is extremely difficult to work out equitably in practice, and perhaps more than any other form of aid a invites immediate retaliation by counter-subsidy. I do not think that the experience of the United States subsidy system, or the slightly different system, combined with some degree of nationalization, that is in operation in France and in Italy, is such as to encourage us to think that its adoption would be to the advantage of British shipping; and certainly it would be extremely expensive to the British taxpayer to try to meet the cost. By the same token, discrimination cannot effectively be met by discrimination. The noble Lord, Lord Brown, gave extremely good reasons for this, and I shall not attempt to "paint his lily". I entirely agree with what he had to say. That, as a method of assisting British shipping, is out. So we come back again to the question of taxation and its incidence.
Assistance to shipping by means of what are commonly called capital allowances is probably the least expensive to the giver, and the most stimulating to the recipient. As the noble Lord, Lord Brown, said, they are no good to anyone who is not making at least a cash profit; but in fact, since the servicing of his capital and the depreciation of his assets represent so large an item in the costs of any shipowner, he will often be making, a cash profit when he will not be making anything like a true profit. So I do not think that the limitations of allowances are quite so severe as the noble Lord, Lord Brown, suggested. They are particularly useful because, if we look at their effects briefly, we see that they tend to reward enterprise rather than sloth or stagnation; and in a sense they regulate themselves, since they tend to disappear when big profits are being earned. At all events, they cease to be necessary.

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In a trade like shipping, where movements are generally rather slow, though the ups and downs are fairly extreme, allowances afford a method of evening things out which, without going into technical details, is extremely convenient and relatively simple in its operation.
It is generally said that in every ten years' cycle in shipping there are seven lean years, for which three good years have to be made to pay. For so simple a generalisation that statement is surprisingly accurate historically, when we look back. The problem for the shipowner, perhaps more than any other, is how he may carry on in the lean years, when he cannot hope to be making substantial profits but has still to attend to the servicing of his capital, to the depreciation of his fleet and, if he wishes to remain in business for more than a short time, to being able to give some return on their investment to those who have invested their capital in his enterprise.
For all these reasons the general system of relaxation of taxes by way of allowances is the best way, I think, of helping British shipping in conditions in which I hope I have suggested to your Lordships some reason why it needs help. I am very far from saying—because it would be both ungrateful and untrue to say so—that this matter has been neglected, so far as British shipping goes, by successive Governments. Indeed, I would go so far as to say that in the eight years, more or less, before 1965 the operation of the investment allowance and the general nature of the taxation system at that time were such that, at any rate so far as new British ships were concerned, the British shipowner was being put in a position where he was at least within sight of the position enjoyed by even his flag-of-convenience rivals. That was not true, I think, of ships already in service, or at any rate not quite so true, but the position was not bad.
The 1965 Act—I am sorry if the noble Lord, Lord Brown, thinks that we attach an undue importance to that Act, and if he does I will still venture gently, but firmly, to join issue with him on it—substituted for a system which, whether by accident or by design, was peculiarly well adapted to a shipping industry, a system which, however well adapted it may be to other industries, is curiously ill adapted to the needs of shipping. This arises in two ways, one of which is not
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perhaps of great practical importance now—and, to be fair, I think the noble Lord, Lord Brown, suggested it might have been working advantageously—namely, that whereas previously allowances were against income tax, they are now against corporation tax. So long as income tax is higher than corporation tax the shipowner loses by the change. If the happy day should arise when income tax is greatly reduced, it is true that the reverse will be the case, but I doubt if any of us can at this moment look forward to that day with any high degree of confidence.
The other change—and this is what really matters in lean times—is that whereas under the old system the tax for which a shipowner was accountable to the Revenue on the dividend which he may have distributed to the shareholders could be satisfied against his allowances, he now has to find it in cash. Since, as I have said, unless he can go on paying some sort of dividend he cannot go on indefinitely remaining in business, there is inflicted on him under this system a cash drain in lean years, when he can least well afford it, which was not there under the old system.
It is true that the effect of investment grants is very much the same in cash in the end as the effect of investment allowances, but they are more rigid in their application and take longer to work through. To that extent, they are not perhaps, a change for the better. I do not underestimate the advantages of free depreciation—the ability to write off what you will in the end be allowed to write off your ship in toto as and when you please in the period of time. This is something which can and does help to even out the ups and downs. But even with those advantages, I think the position, while not perhaps so bad as regards ships not yet built, is still a great deal below the comparable position of the shipowners of other countries in respect of ships that are now in existence. It is perhaps here that some change would be most welcome.
I would not venture in your Lordships' House to make suggestions with regard to taxation, certainly not in any great detail, but the kind of change that I should have in mind would be, in the first place—though I know this would be

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most offensive to the taxation purists—that it should again be made possible for the tax for which the company is accountable on dividends to be met by allowances, and not have to be met in cash; and further, that the general range and scope of those allowances themselves might be looked at again with a view to their (I hope) increase, and also to their rearrangement in the manner more particularly suited to the needs of the trade which they are designed to benefit.
I have tried to suggest that there is inevitably a decline, and there will inevitably continue to be a decline, in British shipping, and, indeed, in the relative profitability of British shipping, so long as British shipping is at the sort of disadvantages which I have tried to indicate compared with the shipping of the rest of the world. That decline may be very slow; it will, I think, be masked, and possibly, to some extent, arrested by the ingenuity and enterprise of shipowners in technical developments, some of which have been mentioned this afternoon, such as containers, where this country is happily, and I think I may say naturally, taking the lead.
There will be periods, no doubt, when everybody is prosperous; and when everybody is prosperous perhaps it does not so much matter if you are not quite as prosperous as the next man. But through and by, I do not think there is any escape from the conclusion that an international industry, operating in an international market against competitors of more or less equal efficiency, will inevitably decline if those competitors start off with advantages which it has not got. We do not ask for anything more than a fair field. If we get that, I should have no fear at all for the future of British shipping, whether in the manpower it would employ, in the return which it would make to those who invest in it, or the benefits, whether in foreign exchange or otherwise, which it could bring to our country. But we have not got a fair field. We do not need more than a fair field, but we really cannot get on with less.
4.47 p.m.
LORD SOMERLEYTON: My Lords, I am the second of the two vessels to be launched this afternoon on a maiden
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voyage in your Lordships' House. I have heard with gratitude that such an occasion is one which here, as in the shipyard, is looked upon with kindness and benevolence by all those present. I feel that I am very dependent to-day upon your Lordships' customary good wishes in what I have to say.
As your Lordships may know, the part of East Suffolk in which I live has become much more prosperous and industrialised since the end of the war, and, among other industries, we have been fortunate to have two medium-sized shipyards, employing together about 2,000 people. These shipyards have not only built large numbers of trawlers for the fishing industry, but have done a considerable amount of work for export. One of these, for instance, has a magnificent export record, including building ships both for the U.S.S.R. and the U.S.A., although not simultaneously.
As we all know, the shipbuilding industry has had its ups and downs since the war, and it is to the lasting credit of these two yards that, not only have they kept going, but they have re-equipped and re-invested large sums of money. It is no exaggeration to say that they are vital to the future welfare of the Lowestoft area, and they have played a most important part in our newly-formed prosperity. Most of the shipbuilding industry lies within development districts and, as such, can enjoy the many advantages which the Government have placed in their way—the regional employment premium of 30s. per man per week, the selective employment tax premium of 7s. 6d. per man per week, the £100 grant for all apprentices, the increased grants for buildings, et cetera. Of course, I realise the importance of a development area policy. The problem is that in this case the drawing of geographical areas on what has to be an arbitrary basis has excluded a very few of the shipyards in the United Kingdom. The fact is that about 90 per cent. of the shipbuilding industry will receive benefits, and the other small proportion constituting the remainder will be excluded.
In the case of one particular yard of which I know the discrimination against them over the next few years will be as follows. With 1,200 men on its payroll this year, the shipyard could lose £120,000 per annum in subsidies from regional

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employment premiums, selective employment tax, grants for apprentices, and on investment. This could mean a 12½ per cent. disadvantage in direct labour costs to that yard. The converse of this can be seen in very human terms. If that yard were to close, it is estimated that 70 per cent. of the men employed, who are mainly skilled, could face long-term unemployment. From these figures it will be realised that there is really no earthly reason why these yards should ever get another order. After all, they are being asked to compete on quite unequal terms, and have, so far as one can see, no compensating advantages at all. It could be said that if they do manage to obtain orders this will be because of their greater efficiency and the relative inefficiency of the yards which compete against them. In other words, we shall be subsidising the inefficient and penalising the efficient—a state of affairs which can hardly be conducive to increasing our competitive position.
That competitive position is particularly important in the realm of exports at a time when all industry has been urged to take advantage of devaluation. It must, however, be realised that a shipyard cannot exist entirely on the somewhat fragile prospects of continued export orders. A competitive position in the home market is an essential base for any business which wishes to continue. This can turn into a vicious circle, for without its firm base at home a shipyard may well cease to be able to tender for future export orders, and there is then no guarantee that these orders will be fulfilled in the country at all. In any case, in an industry such as shipbuilding it must surely be right that the industry should be treated as a whole. Failure to do so could have very serious consequences for my area, among others.
My Lords, I must say quite plainly that Government policy will not succeed if it merely results in helping one development district at the expense of another area which will promptly qualify if this discrimination is continued. What national purpose can be served by allowing all the investment of the last few years in the Lowestoft shipyards to be lost, by creating a depressed area out of a prosperous society, just because of inflexibility in applying the rules? Many of the characteristics of a development
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district already apply in Lowestoft. It would be a tragedy indeed if, in their desire to help one area, the Government did so at the expense of another one.
It may be suggested that we should wait for the Report of the Hunt Committee on the intermediate areas. But I venture to say that unless this Committee report fairly soon, it may prove too late. I realise that. Her Majesty's Government cannot commit themselves to acting upon their Committee's Report in advance—even if the Report supports what I am saying! But I hope that when he comes to reply, the noble Lord, Lord Brown, will give the House some indication when their Report may be expected. It may be thought that the matters of which I have been speaking are of a relatively minor character by comparison with some of the large topics upon which other noble Lords have already touched. I expect that others, too, will be raised. They are, however, matters which are of very great concern in East Suffolk, the Humber, Bristol, Leith and the Solent, and the combined effect could, I think, be important in a consideration of the shipping industry of this country.
4.57 p.m.
LORD MANCROFT: My Lords, my first duty is, as one or two of my predecessors have already done, to declare an interest in the subject of this debate, in that I am a director of a shipping company. My next duty, and a very pleasant one, is to congratulate the noble Lord, Lord Somerleyton, on a most sincere and informed maiden speech. By happy coincidence, my battery was stationed on his property during the war. I remember well an unfortunate episode with some Muscovy ducks. I also remember well the port of Lowestoft, concerning whose fate and fortunes the noble Lord, Lord Somerleyton, has spoken to us with such authority and such knowledge. This was a matter which might possibly have been passed by in the wider scope of the debate, and I think we should therefore be grateful to him for bringing his specialised knowledge, and bringing it in such a clear and lucid way, to our notice. I hope that the Government also will take careful note of what he has said.
I should like also to acid my ward of congratulation to the noble Lord, Lord Hill of Wivenhoe, on his maiden speech.

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He brings to your Lordships' House a wealth of authority and experience over a lifetime in the industry and in trade union affairs. He also brings to your Lordships' House a certain degree of scepticism. I note from the Daily Express of two days ago this quotation from him:
"Mind you, some great statesmen are thrown up by the hereditary Peers. But for each good one you get ten dumb-bells".
My Lords, I have been called many things in the course of the 27 years I have had the honour to serve in your Lordships' House—indeed, I well remember one occasion on which the late Lord Lucas of Chilworth sufficiently forgot his customary good Parliamentary manners as to call me an old Etonian—but I have never before been called a dumbbell, and I can only hope that the noble Lord, Lord Hill of Wivenhoe, who has been a regular attender in this House for some time, will attend sufficiently frequently to allow us "dumb-bells" of both sexes some small chance of getting the ratio into proper proportion.
I have been connected with the shipping industry for only two years, and the noble Lord's association has been for 52 years. I listened with particular interest to his remarks concerning the reduction in the size of our fleets. I must say that I have some considerable sympathy with what he had to say. It so happens that shortly after I joined Cunard I was moving into my office, which is in the old South-Western Hotel (which many of your Lordships will remember) in Southampton. While I was clearing out a desk I came across an old and faded photograph from the local newspaper, taken, I imagine (I am not certain of the date), towards the late 1920s. It showed from the roof of the South-Western Hotel 21 passenger ships —that is, ships carrying 12 passengers or over—in Southampton Docks. Out of idle curiosity, I went up to the roof as soon as I had seen that photograph and stood and looked from exactly the same place as it had been taken. The view made the very point which the noble Lord, Lord Hill of Wivenhoe, was making. Instead of 21 passenger ships in Southampton, there were, on that day, four. One realised the implication of that, not only on life in Southampton but
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on life at sea and throughout the shipping lanes of the world.
Incidentally, among those four ships was the "Queen Mary". Two or three weeks ago I was in Long Beach and was delighted to find the care and skill and affection which the City Fathers of Long Beach are lavishing upon her conversion. They are turning her into a conference centre and a marine museum, and she is fully booked for the next three years. I hope your Lordships will soon hear of an equally satisfactory final destination for the "Queen Elizabeth".
In his interesting speech in opening this debate the noble Lord, Lord Geddes, drew our attention to the fundamental changes which have occurred since this matter was last debated, some eight years ago. He wondered why it should have been such a long time. I believe the reason is that there is no Shipping Vote. There is a Mining Vote, and there is an Agricultural Vote; but there is no Shipping Vote. However, as we cast our minds back to 1960, we recall that there were then about 150 passenger liners in service, and to-day there are only 76— a decline of nearly 1 million gross tons.
I wonder whether your Lordships realise that there is a risk that in the near future it may not be possible, for several months of the year, to cross the Atlantic at all by sea—and this for the first time in 500 years. Most ships which are to pay as passenger liners, certainly on the Atlantic routes, now must be dual-purpose ships, cruising and holiday-making for some of the year, and in the more fruitful time of the year travelling to and fro across the Atlantic. If they cannot do that they will never be able to pay. These are facts of life which must be faced, much as we sympathise with the noble Lord, Lord Hill of Wivenhoe, in his anxiety. The reason for this change is to be found in one quite short word—"jet". What has been the triumph which we have all so greatly admired in Rolls Royce is, unfortunately, no great comfort to those who ply the Atlantic.
Another change which I believe may come over the passenger service in the world is the introduction of a new system of holiday-making, based roughly on the American plan of paying for your meals on board. I mention this small point to

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illustrate the major point that I want to make. I believe that a whole revolutionary series of changes is on the way. Management are facing a revolution, and I think they realise this; but I do not believe that the users of sea transport, the public—or indeed labour—fully realise the revolutionary changes which are facing the shipping industry.
Quite naturally, the noble Lord, Lord Geddes, dealt at length—because this is his particular field of expertise—on the new huge tankers. At the other end of the scale there are small hovercraft, ferries and school ships, "roll-on" and "roll-off" transport. All these represent, in small and varying ways, a revolution in sea transport. But the biggest revolution of all is containerisation. This hideous word embodies a radical change in the whole concept of communications. It means that a system of door-to-door delivery is now coming into practice, in contrast with the old operation by which there might be as many as 16 handlings of goods between producer and user. The sheer artistic beauty of the container operation has to be seen to be believed, and the repercussions will be enormous throughout the whole of our commercial life.
The noble Lord, Lord Geddes, mentioned the 100 or so conventional ships now on the Britain-Australia-New Zealand trade run which, in quite a short time, will be replaced by 9 container ships and a few conventional ones. But the cost of these 9 container ships will be about £70 million, and their owners will naturally require a bigger return on their capital. The noble Viscount, Lord Runciman of Doxford, talked about over-tonnage. I think that this may also happen sooner than we expect with the containers. We may find this new—"craze"' is perhaps too vulgar a word; this new enthusiasm for the whole principle of containerisation may land us almost immediately with an over-supply of container ships.
How is the British shipping industry facing all these challenges? I do not take such a gloomy view as some noble Lords have taken this afternoon. This is primarily a debate on shipping, but inevitably these challenges have repercussions on the shipbuilding industry, which seems to be going through a small boom at the moment, and thus have repercussions
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also on finance, banking, insurance—in fact, right through our whole commercial life. They will have repercussions on the handling of goods at ports, on the livelihood not only of men afloat but of men ashore as well; and on this aspect we were glad to hear the contribution of the right reverend Prelate the Bishop of London. Meeting these challenges will call into being a sharp reaction from organised labour, and I was glad to hear the view of the noble Lord, Lord Brown, on this subject. Of course there will be difficulties. We had difficulties with liner-trains. Let us hope to heaven we do not have similar difficulties with containerisation. If there should be any who differ from me I would only ask them to tear in mind the words of the redoubtable Harry Bridges, of the International Longshoremen's Association of California, who said that any waterfront employer who wished to introduce a system which would prevent his men from spending their days as beasts of burden with sacks and cases on their backs would have his full support. And so it should, my Lords.
Shipping is becoming completely industrialised. Are the minds of those of us connected in any way with the shipping industry becoming equally industrialised? We are admittedly a conservative industry, but radical changes in technique and approach are required. One thing that has not changed in recent years, however, is the desire of British shipping to be able to get on with its job of earning its living and making a significant contribution to the balance of payments. So far as reasonably possible, this contribution needs to be untrammelled by restrictions overseas of foreign Governments or by unnecessary legislation by our own Government at home. Some of the situations which would prevent us from taking full advantage of this revolution are not entirely of our own making. We have heard mention of strikes. One more like the last shipping strike and the shipping industry will be broken, and the union with it.
The noble Lord, Lord Geddes, spoke about nationalisation and crossed swords with the noble Lord, Lord Brown. Naturally, I am powerfully on the side of the noble Lord, Lord Geddes. If one wants to commit suicide he has suggested a very good way to do it. In the foreign sphere there are other things which we

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cannot entirely settle ourselves. There is Suez. Of course, big tankers can solve the problem. Some ships, like those of my own company's Port line, which ply direct between Australia, New Zealand and this country only have to spend an extra day or two going round the Cape, but some of us want to trade in the Mediterranean, some of us want to bunker at Aden, and some of us are rendered practically speechless—and it takes a lot to render me practically speechless—by the ridiculous farce which is now going on in the Suez Canal as a result of the activities of the brigands' benevolent club. How much longer are we to tolerate this? There are 15 ships bottled up in the Suez Canal, four of our own—and I again declare an interest because one of them, my own company's ship, the "Port Invercargill", has been bottled up for ten months. She carries, among other things, a large cargo of pears, and none of the experts we have consulted has been able to tell us what exactly is the chemical effect on a cargo of pears after a long period of refrigeration. If any of your Lordships should happen to be nearby when she finally comes home and docks, my private advice is to stand well clear.
As a final postscript to this ridiculous situation in Suez, the "Port Invercargill" also carries a poor young seaman who recently was afflicted with toothache. The only way in which he could be relieved from his pain was by putting him in the hands of an Egyptian dentist. I, for different reasons, would not like to put myself in the hands of a dentist from any member of the United Arab Republic. This young man had to do so and, to make matters worse, to add insult to injury, he was "caught" and was made to pay £98 for having his tooth taken out.
Noble Lords have mentioned unfair discrimination. I would strongly support the words of praise the noble Lord, Lord Brown, gave to our Embassy in Washington for the staunch work they have done in helping us in these difficult matters. Here we have two separate interests, protection—the American protection lobby is growing stronger every day —and a natural desire for safety at sea. The two are not related as closely as one would think. Of course, we are all in
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favour of the greatest degree of safety at sea. Since the Motion in 1960, to which the noble Lord, Lord Geddes, referred, losses at sea have risen from a quarter of a million tons to one million tons to-day, particularly from fire in port. Our own safety record is high, and so it should be. The worst, I believe, is that of the Lebanese flag, mostly Greek owned, which is 26½ times as bad as us. So the Americans are perfectly right, in view of one or two very unhappy disasters they have undergone, to be fussy about fire and safety regulations. But I must confess that they seem to have acted, as they did with our motor car industry, in such a way that they use the natural desire for safety to allow a little element of protection to creep into their campaign.
My duties as Chairman of the American Committee of the British National Export Council take me to America about eight or ten times a year, and I cannot help noticing there the increasing aggressiveness of American shipping. There have been a series of takeovers of major United States shipping lines by industrial groupings backed by almost limitless funds. We can accept the challenge of aggressive promotion of American shipping, but we may be faced with the absurd situation where American companies in competition with us are heavily subsidised in order to do what American companies show they can do without a subsidy. A continuing subsidy plus limitless capital, plus a vicious cargo preference law would create a very difficult situation for us in Europe, and one from which ultimately neither European nor American shipping would benefit.
I need not repeat the arguments put forward about flag discrimination or about the troubles that will arise from "have-not" countries wishing to have their own shipping and being reluctant to have their goods carried in the ships of "have" countries. This breeds insecurity and resentment. This breeds uneasiness about the whole Conference system, and this is going through a searching inquiry at the moment.
So if we are asked what conclusion we draw from the arguments that the noble Lord, Lord Geddes, has put before us, I would say this. I think this radical and revolutionary situation demands new thinking and new action, not only in the shipping industry but in all the

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ancillary industries and the country at large. I believe exciting results lie before the shipping industry in the next decade. I do not take the gloomy view that some of your Lordships have expressed. But in a capital intensive industry, an industry where the relation of capital to labour is so high, results take time. When your individual capital assets take about three years from planning to delivery and are then expected to have a life of about fifteen to twenty years, you cannot change course overnight. So we have a revolution in sea transport, and revolutions are seldom comfortable. I think there is cause for satisfaction in that we in this country are in the lead of that revolution. Inevitably it will lead, I think, to world shipping breaking up into financial groups, and such grouping is not subject to the directions of any one Government. It will lead to closer co-operation with our colleagues in Europe.
The noble Lord, Lord Brown, has given us his views, and he is going to speak again at the end of this debate. We are entitled to ask ourselves what we look for in the Government. We ask the Government to keep our political sea lanes clear; we ask them to keep clear of our propellers; we ask them to help eliminate or minimise various overseas Government subsidies or preference laws so that British shipping, vigorous and competitive as it is becoming, can work out its destiny in open and fair competition on the trading routes of the world.
5.15 p.m.
VISCOUNT SIMON: My Lords, if the noble Lord, Lord Geddes, needed any justification for initiating this debate—and I am sure he does not he would have had it in the speeches we have so far heard, including, of course, his own. As he said, this is a matter of vital importance to this country, and it is indeed strange that we have not had a debate on this subject in your Lordships' House for eight long years. I have no technical interest to declare, but I have the same interest that we all share in the prosperity of the shipping industry, because it is so bound up with the prosperity of the country. And I have perhaps a personal interest through having been engaged in the shipping industry for over thirty years, and also that my son is now serving in the Merchant Navy, although in fact he is for
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the time being employed by an Australian and not a United Kingdom company.
I do not intend to say anything about the political aspects of the shipping industry, except perhaps one thing, which arises out of what several noble Lords, starting, I think, with the noble Lord, Lord Geddes, and the noble Viscount, Lord Runciman, said about subsidies. I agree very strongly with them that subsidy is a useless form of assistance, and it is in that connection that I thought I ought to say—it is known, I am sure, to some of your Lordships—that the system of investment grants now given is regarded by many of our competitors, and indeed by our friendly competitors like the Scandinavians, as being in effect a subsidy. Only the other day I was talking to a Norwegian friend of mine who made this very point. He asked whether we were giving up our view that subsidies were unsound in this country. It seems to me this strengthens the case made by the noble Viscount, Lord Runciman, for same reconsideration of the basis on which assistance can be offered by fiscal means to the shipping industry.
On one other point perhaps I may make this comment. Reference was made to the encouragement given by UNCTAD, if we may call it so shortly, to the development of merchant fleets in some of the developing countries, largely, I think the noble Lord, Lord Geddes, said, for prestige reasons. I do not think we ought to forget that some of these countries suffered very severely during two world wars because they found that the regular supplies of shipping for their needs were withdrawn. This, I believe, has influenced a number of them, and may indeed have influenced the organisation which is now encouraging them to develop some degree of self-support in this matter. None the less, I recognise that these fleets are often established with little hope of viability. They lead to cargo preference and other forms of help, and indeed do nothing to free world trade.
I should like to turn to the problems of the men on the ships, to which the right reverend Prelate We Bishop of London referred. We have heart that with bigger ships, with more sophisticated ships, there will be—there has been already, shall I say?—a fall in the total number of British seamen employed, and

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there is likely to be a further fall. As the noble Lord, Lord Hill of Wivenhoe, said in his most moving maiden speech, this faces us with serious problems which have to be tackled. But even with the reduced number in manpower required to man our fleet, there is some difficulty in getting, and above all in keeping, the right type of man. Seafaring is not just another job; it is really a way of life. The men on our ships have to live and work together at close quarters for 24 hours a day, and for long periods on end—closer quarters, I think, than they would find in the Armed Services, except perhaps in the Royal Navy; but generally speaking Royal Navy voyages are much shorter than Merchant Navy voyages. There are fewer opportunities for the men in the Merchant Navy to get away from their fellows, and it needs a special type of approach for men to serve happily at sea for long period5 in that sort of company.
In years gone by our Merchant Navy was manned by many people who were traditionally sailors. Their fathers, their uncles, their grandfathers had all been sailors. It was often a local tradition. We know that certain parts of the country have always produced a large number of seamen. Now the local traditions are breaking down under the influence of the mass media of communications, and tradition is perhaps not so much in vogue to-day. Then there are other difficulties. There has always been the pull of homelife on the men at sea, but I think it is intensified to-day, perhaps by the fact that young people are marrying younger than they used to, perhaps too early for them to be able to assess in the long term what the advantage would be. So this rather impatient generation tends to throw up what is a most promising career for the sake of—shall I say?—instant domesticity. Then we have to recollect that there are far more opportunities for employment ashore than there used to be. At the moment the situation is not so good as it has been until recently; nevertheless, broadly speaking, there are —and we are grateful for the fact—far more opportunities for employment ashore.
Finally, there is the question of discipline. I am not sure that the young
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people of to-day are quite so keen as they used to be to accept a career that demands discipline. I shall have a little more to say about that later; I merely mention it in passing. All these difficulties have resulted in perhaps rather slower recruitment than the industry would hope for and, above all, to difficulty in retaining men at sea. As has already been said, the wastage rate has been high in this industry.
What is being done to overcome these built-in difficulties? The life at sea is not without natural attractions. There is the opportunity to see a lot of the world. It provides an opportunity to be part of a joint adventure, to work in a team, which I think has great attraction; and, of course, there is plenty of interest in the job. Certainly in the case of officers, there can be few industries in the world to-day in which responsibilities can be gained so young. Think of a young man of 20 years old who has just passed his second mate's certificate, so that he finds himself for 8 hours out of the 24 in charge of the ship, its crew and its cargo. Admittedly, the master is in his bunk asleep and can be called if he is needed. Nevertheless, this young man has that full responsibility on his shoulders. As I say, there are few industries where the excitement of responsibility can be achieved so young.
The industry has also done a great deal in the matter of training. The accommodation provided for seamen is much better than it used to be. I am told that now in the vast majority of cases every rating on a ship has a single berth cabin. That certainly was not so thirty or forty years ago. I admit that the hours are long, and the opportunities for relaxation on board, although much better than they used to be, are perhaps not all that good. The general impression I have is that the men do not really resent the hours that they are required to work, nor the fact that they have to work seven days a week, for which, by negotiation, they have additional leave opportunities on their return to this country.
I believe that the opportunities for advancement are now nearly as good as in any industry. It has been suggested that the ordinary seaman on deck has little chance of becoming an officer, but

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I am told that quite recently arrangements have been made to pick out promising boys at the National Sea Training School at Gravesend, to which the right reverend Prelate has already referred, and to put them in the way of officer training. This matches the opportunities that occur in many industries ashore towards promotion to managerial rank. After all, the masters and officers of ships are in fact the managers of those units. There are special difficulties about training because there is not opportunity for following further education ashore, except of course during periods of leave. You cannot have anything comparable with day-release, and it has been pointed out that shipboard life is not altogether conducive to correspondence courses. Nevertheless, provision is made.
I think the right reverend Prelate also referred to the College of the Sea, which has done so much to encourage men at sea to improve their intellectual capacity. Reference has already been made to the National Sea Training School. I will say no more about it, except that it is proving a great success, and I am told that in this field there is a large waiting list. But, as the right reverend Prelate told us, there is, unfortunately, a substantial wastage later. This school aims to provide, as well as a sound, technical education, some preparation for boys for the kind of life that they will lead at sea. The training of officers is through what is really an apprenticeship scheme. Here again, new facilities have been provided recently. There is an ordinary national diploma course in nautical science, and those who pass well in that can go on to a degree in maritime studies. So undoubtedly there is a steady raising of the educational attainments, and I hope of the mental developments, of the officers and ratings at sea.
There is one matter which was brought to my notice. I apologise to the noble Lord, Lord Brown, that I did not mention this to him in advance, and perhaps he will not be able to say anything about it. I am told that from the middle of this month there is being withdrawn from the shipping industry a concession under which unemployment benefit is paid to seafarers during their training ashore while awaiting employment. The industry spends altogether £4 million a year, or 3½ per cent. of the wage bill, on training.
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As was said by the noble and learned Lord, Lord Pearson, in his report, this is a fine record and compares favourably with that in any other industry. I am told that the result of this decision, if this unemployment benefit is to be made up to men undergoing training, will cost the industry another £500,000 a year. The noble Lord, Lord Pearson, suggested in his Report that the Government should give serious consideration to the whole question of giving support to training. A very large amount is spent by the industry, and it also has to take into account its inability, because of the circumstances, to benefit from many of the facilities in the country supported by public funds.
I should like now to say a few words about industrial relations in the industry. The National Maritime Board, representing both sides of the industry, was set up as long ago as 1920, so that it was almost a prototype for the National Joint Councils which have been set up in different industries since that time. For many years the National Maritime Board was able to settle all the problems of terms and conditions on the friendliest possible terms. This was done by having a completely free discussion in the Board between the owners and the representatives of the men. But I feel that this pioneer development carried with it a seed of danger. I wish that the noble Lord. Lord Hill of Wivenhoe, had been speaking after me, since I could have asked him to comment on this matter but perhaps the noble Lord, Lord Brown, with his great experience of industrial relations, may like to say something on the subject. The danger, as I see it, is that the more successful such an institution is, the greater the danger that the men's representatives will not be able to retain the confidence of those whom they represent.
To put it in its simplest form, if, after free and open discussion, the men's representatives are satisfied that the state of the industry is such that they should not press a claim beyond a particular point, and a settlement is made on that basis, they have then to put it across to their members. In the nature of things they cannot explain to their members all that they have heard. The whole point of confidential discusions is that the men's representatives are told the inner secrets,

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shall I say, of the industry, the nakedness in which the industry is standing; and in an industry like shipping, which is open to the winds of foreign competition, these matters cannot be noised abroad. Therefore one has the very real difficulty that a just and proper settlement can be agreed, but that the men's representatives find themselves in difficulty when presenting such a settlement to their members and justifying it.
This is particularly true in the shipping industry where the union members are scattered all over the world. It is not just a case of getting them together in a factory, explaining things, and perhaps answering some questions. In the shipping industry all this has to be done by circular letters, and so on, which have to be worded cautiously, and it is easy to understand that the men's representatives may lose the confidence of their members. I remember a conversation which I had twenty years ago with a leading official of the National Union of Seamen on this very point. I asked him if he did not feel that the danger of the very close relationship between the representatives of the owners and the representatives of the unions—and it was a close personal relationship of friendship—might weaken their influence. He felt sure that it did not. But I wonder whether after-events have shown that he may not have been right.
Your Lordships may remember that during the unhappy strike of 1966 the Prime Minister said in another place that he thought it was partly due to the fact that the owners had the unions in their pocket—I do not think they were his exact words, but they gave that impression. I confess that I felt a little annoyed when this was said. I thought that it was unfair to the leaders of the National Union of Seamen and the others who had co-operated inside the National Maritime Board. I could have understood it if he had said (and perhaps this is what he meant) that it appeared to the men that the union leaders were in the pocket of the employers, since this would have echoed the fears which I have expressed. I believe that this is a problem which will face trade unions and management in the future, when we all hope that we shall come closer together and have more negotiations of this type.
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I hope that all concerned, on both sides of industry, will give careful consideration to this aspect.
Briefly, the answer is clear. It lies in improved communications. In the shipping industry this means communication between the unions and their members; it means communication between the managers at home and their captains. I emphasise that aspect, since for many years there was a great lack of communication between the owners and their captains so that in industrial matters the captains did not know what the policy was or what the owners were trying to do. It also means improved communications between captains, masters and their men, and vice versa.
The noble and learned Lord, Lord Pearson, in his interesting Report criticised the National Maritime Board because he felt that it led to centralised negotiations and left a complete absence of any kind of industrial relations on board ship. This was perhaps fair comment, but I believe that it was due partly to the circumstances which I have tried to describe and partly to one other matter to which I shall refer in a moment, the application of the Merchant Shipping Act. The difficulty on board ship no doubt stems partly from the authoritarian position of the master, who for a long time was virtually separated not only from the crew and from his mates, but also from his owners. He lived in a world by himself, in a cabin by himself, and he ate his meals by himself. This situation, based as it was on tradition, undoubtedly led to a situation in which the master was too far removed from the men whom he was supposed to manage.
It is interesting to find that the master was not always in quite such an isolated position. In the Law of Oleron, of which noble and learned Lords will have heard, one of the earliest maritime laws of the 13th or 14th century, there is a delightful law which runs as follows:
"A ship is lying in a haven and Tarryeth for the freight and the time to sail, the Master ought to take counsel with his fellowes and say 'Mates, how like ye this weather?' Some will say, It is not good—let it overpass'— others will say 'The weather is good and fair'. The Master ought to agree to the most, or else if the ship perish he is bound to restore the value as it is appraised, if he have wherewith."

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That was in the 14th century, and in the absence of life-saving equipment the chances were that if the ship perished the master perished too; so perhaps the admonition at the end of that Law was not very successful.
Over the centuries that position clearly changed. The master, no doubt remembering the wording on the bill of lading that he was "Master under God", started considering that he was much nearer to God than to his fellow men. Please do not misunderstand me, my Lords. There were many very fine, good masters, and they were not by any means ill-treating their crews or anything of that kind, but there was simply the one man in command of the ship. This went on, I suppose, until steam was invented and the chief engineer arrived. Then the master found that there was somebody he had to ask about the boilers, because the chief engineer knew more about boilers than he did.
As the noble Lord, Lord Hill of Wivenhoe, will know, this led to a feud between the navigators and the engineers of ships which lasted well into this century, though I am happy to say that it is disappearing now. But the master is still remote, and perhaps one of the reasons for this is because of the working of the Merchant Shipping Act. I was very glad to hear the noble Lord, Lord Brown, say that progress was being made in preparing the amendment of this Act. As your Lordships know, the main Act is dated 1894, but that incorporated many sections from much earlier Acts. The archaic procedures and formalities are no longer necessary, and they tend to create an image of an industry which is strangled by out-of-date practices. Moreover, I think that the paternalistic attitude of the Board of Trade under the Act—the fact that the seaman does not look to his union, which of course had not been invented at that time, to protect him from injustice; he looks to the Board of Trade—results in the régime of the ship being established by law. It seems quite possible that one of the reasons for the lack of any form of normal industrial relations on board ship is that both the master and the men say, "Here is the law. The law says we may do it—we do it. The law says we may not do it—we do not do it. What else is there to talk about?"
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This brings me to mention one other matter arising under the Merchant: Shipping Act, and that is the question of discipline. The disciplinary provisions of the Merchant Shipping Act are quite clearly, on the face of them, archaic. Your Lordships may or may not know that misconduct or neglect endangering ship or person is a criminal offence. That is a very serious thing, and perhaps it is right that it should be a criminal offence. Desertion is also a criminal offence—although in other industries it might be called absenteeism or withdrawal of labour—which is punishable by imprisonment. There is in addition a system of fines on board for breaking regulations approved by the Board of Trade, covering such matters as assaults, drunkenness and disobedience to lawful orders. One must wonder whether this form of discipline and the methods of enforcing it are really necessary in the present day. It is certainly unique in twentieth century industry in Britain, but, of course, a sea voyage is I very special kind of enterprise.
I should like to read what the noble and learned Lord, Lord Pearson, said about the matter in his Report. I do not know whether any of your Lordships have brought the Report with you, but paragraph 287 is worth reading. It says this:
"In our opinion—"
the opinion of Lord Pearson and his colleagues—
"…it is clear beyond doubt that a special disciplinary régime of some kind is required by the special conditions of seafaring life. Discipline is necessary in the interests of safety, in order to secure proper co-ordinated action by the crew on any occasion of emergency for saving the ship, crew, passengers and cargo from the perils of the sea. Discipline is necessary in the interests of efficiency, in order to secure the proper operation and handling of the ship and its equipment at all times. Also, discipline is necessary for preserving law and order in the confined and inescapable conditions, because the ship is a total institution in which the seaman works, eats, sleeps and spends his leisure time in the same limited area with approximately the same people as his workmates, companions, and neighbours. Good discipline must be maintained somehow."
I think your Lordships will agree that there is a clear case for some form of discipline. But I think that the system that is now enshrined in the Me.-chant Shipping Act is such as, perhaps, to frighten some people away from the sea and, perhaps still more, to provide the

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sort of point which men who want to make trouble can so very easily make into trouble. I doubt very much whether in recent years the disciplinary provisions of the Act have ever been enforced unreasonably or harshly, but there it is. The provisions are there, and they are just the sort of thing that people who want to make trouble can so easily get hold of.
In conclusion, I want to say this. As I said at the beginning of my speech, I spent 34 years working in this industry, but I hope I can still look at it objectively. I believe there is no industry in this country in which management is more concerned with the safety and the welfare of those who serve it. The cynic might say, "Well, they have to be". But certainly there is a tremendous amount of thought given to this by the managers of all our shipping companies. In spite of what the noble Lord, Lord Hill of Wivenhoe, said about certain cases a good many years ago, the good safety record of British ships speaks well for this. The noble Lord, Lord Mancroft, mentioned some figures, which were quoted the other day, of annual losses expressed as a percentage of tonnage in service. It was interesting to find in that analysis that this figure, which fell until 1959, has been rising steadily since them. But whereas the world figure for the ten years up till last year was 0·45 per cent., the United Kingdom figure was 0·15 per cent. That I think, makes the point that I was seeking to make.
May I conclude with a personal note? I had the great privilege to serve under one of the greatest leaders of British shipping in modern times, Sir William Currie. I remember the tribute paid to him by Earl Alexander of Hillsborough, when he was Leader of the Opposition, after Sir William's death. There was a man who never took a decision without having in the forefront of his mind what that decision would mean to the men who served the company. There were many others like him, and I am happy to think that in the shipping industry to-day many leaders, if they did not have the privilege as I had of working under him, were influenced by him and by others of like mind. If our shipping companies are managed in that way and are served by the splendid men who go to sea in our British ships, then I have no
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doubt that the shipping industry, if it cannot command success, deserves it—and is not that more than half the battle?
5.48 p.m.
THE LORD BISHOP OF WINCHESTER: My Lords, sailing a dinghy, one of my holiday joys, may seem a very inadequate qualification for contributing to this debate. However, from my boyhood the sea and ships and seafaring men have had a great attraction for me, and I am particularly happy to have had in my former diocese—that of Chelmsford—the ports of Harwich and Tilbury and much of London's dockland, and to have in my present diocese the port of Southampton. During my few years at Winchester I have paid two official visits to the docks at Southampton, watching with interest the latest developments and talking with men at their work. I have also spent a day at the Esso refinery and watched tankers unloading. On my most recent visit to Southampton, a few weeks ago, I was particularly interested to see the four new roll-on roll-off terminals, the construction of the new 1,000 ft. quay for providing facilities for the berthing of the largest container ships, and the most modern, mechanical appliances for handling containers. Interested, however, as I am in the technical side of these modern developments, it is the human aspect, radically affected by these developments, that is my particular concern this afternoon. The well-being of man is ultimately of greater importance than the efficiency of the machine he operates. So, my Lords, I venture to say a few words about seamen's welfare.
The shipping industry is now witnessing, as we all realise, the break-up of an old and archaic system of industrial relations. Its replacement, at least in some sections, by something more in keeping with modern industrial practice is to a large measure due to the Pearson Report. Before any change could take place it was necessary for employer and employee to meet, man to man, and for the problems of men at sea to be understood and taken into account. Perhaps for the first time for centuries, seamen are being brought back into the main stream of British industrial life instead of being treated as a race apart.
In the past, the more the employers clung to an image of a solid front the

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more the unions clung to traditional demarcation lines between deck crew, engine room crew and catering staff, in order to preserve their jobs. Because of those demarcation lines, many men were idle for a lot of the time and unable to help out their colleagues. As a result of this job structure, British shipping in terms of profitability lagged behind European standards. Moreover, the division between "officer" and "crew" on board ship, to which the noble Viscount, Lord Simon, has just referred, often led to bad relations. In July, 1965, the system was started of "liaison representatives" on board ship. This was a big step forward from the old tradition of absolute rule by the officers. But the great change recommended by the Pearson Report was that the solid front of employers should be eased to allow individual companies to
"plan, develop and implement effective personnel policies".
The first two companies to act under this recommendation have been the two oil companies, Esso and Shell. If I choose Esso rather than Shell to illustrate the new approach, the sole reason is that I happen to have closer contact with Esso in view of their special link with Southampton. As many of your Lordships will know, Esso have done considerable research on human relations and sociological problems. It was found that among the causes of dissatisfaction among seafaring men were these. First, sailors like to work at sea rather than idle about. Therefore, the dispute on the 40-hour week was about money, not hours. Secondly, sailors and officers need to see a lot of each other if retraining is to take place, and the practice of transferring crews from ship to ship is not compatible with retraining. Thirdly, the major problem was the insecurity of the sailor's life—once at sea, forgotten by everyone. If this latter cause of dissatisfaction could be removed, a major cause of intransigence would go. Fourthly, sailors would favour a more permanent relationship with their employer, instead of their present nomadic existence.
As a result of this research, a new policy was thought out and eventually agreed between the National Union of Seamen and Esso providing conditions for a new and closer relationship between the company, its seafarers as employees of the company, and the union.
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The agreement is known as the Green Book Agreement of July, 1967, and is entitled A New Marine Personnel Policy An important part of this new agreement is what is called the integrate I crew system. This dispenses with the traditional division of labour between deck, engine and catering, to which the noble Lord, Lord Geddes, referred. As far as possible, all men will have an equal share of all work to be done, and more uniform earnings. In September, 1967, the first ship to sail under a new agreement was the "Esso London". Besides granting fairer pay related to training and experience, many human factors were taken into acount, among them being the lowering of social barriers between officers and men; additional shore leave; better amenities; flexibility between deck, engine room and catering crews (for which training was given); and the crews to become permanent employees with a permanent ship. The system also provided for a genuine career with promotion opportunities, each ship to be run in like a business operation on land with a management committee.
This new approach will, Esso are confident, create the conditions for a dramatic breakaway from the tradition of casual employment at sea. As a cooperative effort on the part of the company and the trade union, it should lead to a rise in the status of seamen, and improvement in the conditions of employment, the development of a wide range of skills and an increase in technical proficiency. I understand that about 16 other companies are interested it introducing a similar policy for what are otherwise called general purpose crews, but such ventures are not low in cost and it may not be possible for smaller companies running on lower profit margins to introduce schemes of this kind. I mention this new approach, my Lords, because it seems to me to be a timely reminder that problems of human relations and sociological issues must be faced if the shipping industry is to prosper in the future. An environment must be provided in which men can satisfy their desire to "belong"—to be members of a community, each able to make a valuable and essential contribution to its daily life and work.
I turn now from the welfare of seamen on board ship to the welfare of

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seamen ashore. The right reverend Prelate the Bishop of London has already drawn attention to the invaluable service rendered to seamen by the various voluntary societies and organisations. May I put in a plea for a realistic attempt on the part of these societies to plan and work together in meeting newly-emerging needs in the new and remote port areas at home and overseas which are being rapidly brought into being as a result of the development of containerisation, bulk carriers, et cetera? It would be manifestly absurd for The Missions to Seamen, the British Sailors' Society, the Apostleship of the Sea and the Norwegian Seamen's Mission, not to mention the Swedes, the Danes and the Finns, to try to jostle each other for sites and opportunities of work in these new areas. In two South African ports, Durban and Port Elizabeth, experiments are already being made in co-operative action between The Missions to Seamen, the British Sailors' Society and the Apostleship of the Sea, and further possibilities are being examined for the vast new port area of Antwerp. There must be rationalisation, there must be joint consultation and there must be co-operation, if service of the very first quality is to be offered to men of an honourable profession whose work is of the lifeblood of this country and of the world.
Hitherto I have omitted any specific reference to what I regard as the most important aspect of a seaman's welfare, and to this I now turn briefly. I refer, as the right reverend Prelate the Bishop of London has already done, to a seaman's relationship with his wife, home and family. If we are considering the welfare of the seaman, we must be concerned with the wellbeing of the whole man, including his family relationships. From time immemorial the sea has called men to make voyages which take them away from home and family for weeks, or even in the old days for years, at a time. The disruptive effect on husband/wife and husband/family relationships to-day, as in past times, is easily realised. The major calls on chaplains and welfare workers in this field are for counselling in matrimonial difficulties, of which alcoholism and drug-taking are sometimes the symptoms. To-day, containerisation and automation, as we have already been reminded this afternoon, are some of the
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factors which result in so quick a turn-round of a ship in port that the seaman may not be able to go home to visit his wife and family.
It is vitally important that every possible solution should be explored with a view to preventing the complete disruption of a seaman's home and family life and to enabling a seaman to see as much as possible of his wife, and the wife as much as possible of her husband, within the limitations inevitably imposed by a merchant seaman's life to-day. What can be done? The Dutch and the Scandinavians have already tried to overcome the problem of separation by enabling seamen's wives to accompany their husbands on occasional voyages. This lead is being to some extent followed by British shipping companies, although there are obvious difficulties in the way and the experiment as yet has largely been confined inevitably to the officer class. Even if such a solution proves impracticable on a wide scale, the psychological effect of enabling wives who can extricate themselves from their home and their children to share occasional voyages with their husbands would be great. Again, much good can come from the payment by the shipping company of travel costs for wives to visit their husbands at United Kingdom ports and for men to return home from their port of disembarkation for however brief a The most valuable way of helping in this family problem is to ensure that a seaman has a reasonably long period of leave possibly twice a year.
I have been delighted to find that emphasis is laid on this in the new policy of Esso. I quote:
"We believe that time available to our seafarers at home with their families is extremely valuable to them and it is our intention to arrange the planning of seamen's work with these factors in mind. The leave entitlement has therefore been increased and is proposed to be 72 days per annum compared with 48 days. The intention would be to allow for leave to be taken at 5-monthly intervals where possible."
In order to facilitate the carrying out of this intention as well as the fostering of the integrated crew system, the Esso plan is that on a 90,000 tonner, while there should be a total self-relieving crew of forty-four, the actual crew for any one voyage should be only thirty-one.

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My Lords, I commend these various attempts to solve a problem that must be solved if this noble profession is to continue to attract in the future, as it has attracted in the past, some of the finest of our nation's youth, and not to lose its attraction as the years go by.
6.1.p.m.
LORD TEYNHAM: My Lords, the right reverend Prelate the Bishop of Winchester has given us a most interesting exposition on the welfare of seamen. I think he mentioned the British Sailors' Society, of which I have the honour to be a director. This Society has hostels in most of the main ports of the world and is very much appreciated by the seamen. The noble Lord, Lord Geddes, referred to the opening last year of the National Sea Training School at Gravesend, which is proving a very efficient organisation. Perhaps I may mention that I am concerned with sea training as chairman of the Prince of Wales Sea Training School at Dover, and I can confirm the gradual breaking down of the traditional divisions between deck and engine-room training which is in evidence at this school. I am sure that this is a great development, one which I think was touched on by the right reverend Prelate. As a professional seaman, I am very interested in the training of the young for the sea. In fact, I provide a number of boys for Lord Man-croft's shipping company, the Port Line. Very many of them who went to sea as deck boys are now masters of their own ships.
I suggest that it is very appropriate that we should have this debate on the shipping industry at this time, in view of the fact that the Committee of Inquiry is, I understand, still sitting and studying all the aspects of the shipping industry. I wonder whether the Minister who is to reply for Her Majesty's Government can indicate when the Committee is likely to make its Report. I would emphasise the fact that the shipping industry contributes no less than £140 million a year to our balance of payments, and if there were no British ships the net cost to our balance of payments would be of the order of £300 million. I was glad to hear from the noble Lord, Lord Brown, that Her Majesty's Government fully realise the true nature of the benefits which the ship-
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ping industry gives to our balance of payments.
I should now like to touch on an aspect of British shipping which I think has not so far been mentioned in the debate this evening. I am sure that all your Lordships realise that without this lifeline of British shipping this country would, with the advent of war, quickly starve. I, and many other noble Lords, are very concerned at the proposal of Her Majesty's Government to withdraw our presence East of Suez. This may well have a serious effect on our merchant fleet, even in peace time. This matter was referred to in the recent defence debate but, I would say, was rather brushed aside, There is no doubt that the shipping industry is disturbed about the absence from official Government statements on defence policy of any clear commitments to the importance of defending merchant shipping.
Shipowners believe, and rightly so, that the visible presence of the Royal Navy in areas East of Suez has undoubtedly assisted in preventing mischievous activities against merchant shipping. If we look back to the Defence White Paper of 1966 we find these words:
"Royal Naval vessels give a visible British presence throughout the world, often where other British forces are seldom seen."
Has all this been forgotten by Her Majesty's Government? I should like to ask Her Majesty's Government whether they are prepared to give an assurance that they recognise the importance of giving protection to our merchant feet. I should like them to provide a clearly defined policy as to how this is to be done East of Suez when our presence has been withdrawn. I should like to know, also, what is to be done to provide merchant ships and their crews with the capability to protect themselves against likely forms of attack.
I suggest that it is not generally realised that the whole conception of NATO and American defence policy has recently undergone a fundamental change, and that this has a considerable bearing on our merchant fleet. The former Defence Secretary of the United States, Mr. McNamara, in a message to Congress, envisaged that the United States might have to fight an all-out war at sea which would last many months and which would threaten their allies' shipping as well as

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their own. In fact I would say that since the advent of the nuclear weapons a conventional war at sea is contrary to official doctrine. I do not know if Her Majesty's Government subscribe to this policy; but if they do it is all the more reason to provide adequate protection for our merchant shipping in the sea lanes of the world. I would say that the greatest danger to this country is a conventional war at sea. We have seen the naval buildup of Russian forces in surface craft and submarines, and I would say that we are in a perilous position to maintain our lifeline across the oceans. There is no doubt that the British shipping industry is disturbed at the inadequacy of our defence support at sea and that anything Her Majesty's Government can say to allay this fear will be welcome.
6.6 p.m.
LORD SANDYS: My Lords, we should be deeply grateful to the noble Lord, Lord Geddes, for having introduced this Motion this afternoon. It has given an opportunity for two particularly thoughtful speeches on the shipping industry. My reason for intervening in this debate is largely a hereditary one. One of my forbears was Secretary of the Virginia Company and a charterer of the "Mayflower". In much more recent times I had the extremely good fortune to have an uncle who was a sailor and responsible for the escort of merchant ships on the Western Approaches—to which the noble Lord, Lord Teynham, has referred. I had the special privilege of visiting him at his headquarters at Greenock during the war and of seeing at first hand how the incredibly important role which the Royal Navy had to play was worked out in practice.
Special mention has been made this afternoon of the importance of shipping among our invisible earnings—earnings which contribute in no small measure towards our balance of payments. But we could do very much more if the climate of opinion in public understanding were more favourable. Visible exports occupy the centre of the stage and enjoy the full benefit of Government measures while shipping, prominent among invisible exports, suffers the full disadvantages of, principally, the positive and obvious disincentives of S.E.T. in shore establishments in the United King-
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dom; the crushing blow of devaluation, especially in hired freight tonnage from overseas; the effects of exchange control; and, in particular, something that has been mentioned by the noble Lord, Lord Geddes, and others, the export rebates. A section of Chapter 25 of the Geddes Report takes up this subject in very much greater detail than I propose to do.
The noble Viscount, Lord Runciman of Doxford, dealt in extreme detail with the question of investment grants, and I would not presume to add one word to what he said on this subject. Finally, I turn to a subject concerned not with taxation but with incentive, the disqualification which the shipping industry has in competing for the Queen's Award. I think it especially unfortunate that the shipping industry should suffer this handicap. I have verified to-day with the Board of Trade that this is so. This is a sorry recitation of some of the many difficulties from which the shipping industry suffers. All of them could have been either avoided or modified to some extent by the intervention of Her Majesty's Government.
For several centuries our foreign policy, our trading policy and our shipping policy have all been closely intertwined. Royal charters were granted to trade in various parts of Europe, the Levant, Russia and, in the case of my noble forbear, in the Americas. The roles of Ambassadors and merchants were closely intertwined. In those days we knew just where we were going as a maritime Power, and over the centuries we have developed a commercial, relationship of which we may be justly proud. Recently our interest in the European Economic Community has been the focus of attention, but it seems to me that our vision is being restricted, and we should look to our partners in the Commonwealth, in E.F.T.A. and very probably in the North Atlantic Free Trade Area, with whom we have a natural affinity and a very close understanding.
To return, my Lords, to invisible earnings: there are behind the decline in our net earnings deeper causes, some of which I feel we could redress. Failure to deliver goods to the right place; goods held up for months on quaysides and lost, accruing very heavy demurrage charges; contaminated cargo, or goods which in some

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way have failed to give satisfaction, are a growing cause of deep concern among British exporters and their customers overseas. Orders have been lost to foreign competitors. The story has a weary inevitability about it. But is this the fault of British shipping? I think it is only in part so. It is the system of handling our cargo freights which needs radical alteration, and not the basic principle of sending goods by sea. The old pattern of cargo, what we might term the Masefield era of "coal out—grain in" has now diminished from a torrent to a trickle. Traffic in "firewood, iron-ware and cheap tin trays" has largely been replaced by a very much lighter, more fragile and more specialised group of exports: electronic equipment, machinery, highly processed goods, based on a whole new range of skills of which British industry can be extremely proud.
This is a challenge to our historic, British maritime expertise which for centuries we have looked to and relied on for our trade. To meet it a new skill in handling cargo must be acquired through containers. The container concept is not a new one, but the application of it to the British shipping industry may well prove, in my humble opinion, to be the turning point in our quest to hold and retain foreign markets. If the Government will give the container industry their full backing by reducing restrictive regulations and time-wasting procedures, including, in particular, the Transport Bill, they will go a very long way to earn the respect and admiration not only of noble Lords on these Benches but of a very much wider community.
The inception in February next year of the first joint enterprise of two British companies, Overseas Containers Ltd. and Associated Container Transport will open an entirely new phase in cargo handling. This new container way to Australia from the six container bases, scattered as they are between Scotland and the South of England, passes through the new ocean terminal at Tilbury and will have the effect of bringing Sydney 16 days closer in the turn-round because of vastly improved load schedules. As has been mentioned earlier, it brings an entirely new door-to-door service of through transport which will link exporters in both countries with their customers, and
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it offers five special advantages over the normal trade handling.
First, damage, pilferage and contamination are virtually eliminated. Secondly, there is simplified documentation (I feel sure that the burden of documentation upon exporters is so well known, as to need no explanation) and the problem of customs clearance, demurrage and insurance is eased. Thirdly, there is the substantial saving to be obtained through overall delivery time. Fourthly, exporters will now have a special advantage because they will be able to quote a delivered goods price and not cost, insurance freight or free-on-board prices. Fifthly, and most important of all, is guaranteed delivery. Action by Her Majesty's Government could greatly improve inland transport in the United Kingdom, which could speed the containers upon their way to a terminal base. In this respect the road improvements programme, about which an announcement has been made to-day that £325 million has been placed in the preparation pool, will be welcome. Nevertheless, we should remind ourselves that this is for the early 1970s and that the container service in fact starts in February, 1969, so that, in the initial stages anyway, the road improvements will just not be there.
My Lords, I would repeat a special plea, which has been made earlier by several noble Lords, that we should drop the 100-mile regulation. This regulation will be a most confounded nuisance. Suppose that the distance between the port and the factory of origin or entrepôt for goods is 106 miles or some similar figure, is it really going to be necessary to obtain a special certificate or document provided by the Board of Trade for this purpose? That would seem to be the height of foolishness.
Containers can play a big pert in improving the loading and unloading of raw materials. Take timber, for example. We import into this country some 5 million tons of sawn softwood every year. The Timber Research and Development Association has just been carrying out a survey. Unfortunately the report will be published in about ten clays time, so I do not feel that I should comment on it except in one special respect: that the savings through the use of palletised and

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containerised cargo, or the use of packaged timber, to put it in its broadest sense, will be up to £10 per standard on the Canadian trade and £6 per standard on the Scandinavian trade. These savings will be of very real value, not only for the importing houses but especially for the British building industry, at a time of great problems in this country. We look forward to the publication of this report and we should be particularly glad to have it publicised to a wide extent. My Lords, at this late hour I do not feel that I should continue to go into great detail about containerisation problems, and I am content to leave it at that.
6.18 p.m
EARL JELLICOE: My Lords, no one in this country is better equipped to initiate our debate this afternoon than my noble friend Lord Geddes, as his admirable survey has shown. He is doubly qualified, not only by his personal and deep knowledge of this industry but also in his present capacity as President of the Chamber of Shipping. I am also glad for another reason that the noble Lord decided to put down his Motion. As he said, it is now eight years since we last debated the shipping industry, and that is far too long a delay. In my view, we need much more frequent debates and we should pay more consistent attention to this important industry. We have the time, if we so wish, and we have the expertise too, as is shown by the array of shipping talent, both lay and ecclesiastical, which we have witnessed to-day.
My Lords, two bright new "vessels" have joined your Lordships' fleet to-day. Having been observed for some months by the noble Lord, Lord Hill of Wivenhoe, we have had the pleasure to-day of hearing him break his silence. Like the remainder of your Lordships, I greatly enjoyed his maiden speech, and I very much hope that, having found his voice in your Lordships' House, he will not lose it. Precisely the same applies to my noble friend Lord Somerleyton. I should like to congratulate him most warmly on his informed, thoughtful and very specific maiden speech.
I cannot claim anything like the special knowledge of this industry which is
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possessed by so many speakers who have gone before me. All I can claim is a certain hereditary interest, having had as my paternal grandfather a merchant seaman and as my maternal grandfather someone who helped to found what has become one of Britain's greatest shipping companies. But it struck me, listening to your Lordships' debate this afternoon, that five main themes have emerged from it.
The first, on which I do not intend to say anything in summing up, but which I feel profoundly, is the importance of the human factor in this industry. The second is the vital part which shipping plays in our balance of payments, its contribution to the economy and the handicaps under which it is labouring. The third is the theme of change. The pace of change within this industry has never been faster than it is to-day. The "winds of innovation", to borrow Lord Brown's phrase, are sweeping through it. The fourth is that since this industry is in every sense international, it creates problems which inevitably demand an international solution. The fifth theme is that this is an industry which in the past successive British Governments, and perhaps the British people, too, have tended to take too much for granted. I believe that in to-day's conditions Government can do a great deal to hinder it and a great deal to help. There is scope for valid and fruitful collaboration between Government and industry here.
As I have said, in the days when our industrial and maritime supremacy was taken more or less for granted we could afford to take our shipping industry more or less for granted. With our backs against the economic wall, we can no longer afford to do so. Our future depends on whether we get our balance of payments right— and very quickly. As anyone who has read the Clark Report on Invisible Exports knows, invisible exports play a large part in our balance of payments, and to these invisible exports the shipping industry made a net contribution in 1966 of nearly £150 million sterling. But this is not the whole story. There is also the shipping account as a whole. Here again, as the Clark Committee pointed out, some £200 million were spent on time charter power

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from abroad in 1964, and a further £200 million on import freights in foreign ships. As the Report states:
"Insufficient is known at present to be certain why there are not sufficient British ships to enable those two main items of expenditure to be substantially reduced."
A number of noble Lords—my noble friends Lord Geddes and Lord Runciman of Doxford, and the noble Lord, Lord Hill of Wivenhoe—have spoken about the falling British share in the world mixed fleet, as did the noble Lord, Lord Brown. I thought that he did so with undue complacency. I was impressed by what the noble Lord, Lord Hill of Wivenhoe, said on this matter. I was also impressed by the forecast which I saw in a recent article in the Financial Times by a Norwegian expert, Dr. Svensen, of the Institute of Shipping Research at Bergen. We have heard from my noble friend Lord Geddes that we have just been overtaken by Liberia at the head of the shipping league. In his article Professor Svensen forecast the likely pattern, as he saw it (this was only a personal and subjective forecast), of the world's mercantile fleets in 1980, only twelve years ahead from now. According to his forecast, Japan and Liberia would then be equal first, with 35 million tons, and Norway second, with 30 million tons. By then we should have dropped to fourth position, with perhaps 25 million tons, with the Americans and Russians pressing hard on our heels. I should like to know whether the Government accept this forecast, broadly speaking, and whether they think there is a point at which this decline in our relative shipping position (I am not talking in absolute terms) should be arrested. I do not wish to dwell further on this point. My noble friend Lord Runciman of Doxford had a great deal of value to say on it.
I listened carefully to what the noble Lord. Lord Brown, had to say about the taxation changes since 1965 and how they affected the industry. I hope that he, in his turn, will study carefully the measured words of my noble friend on fiscal matters. I believe that these, if followed up, could serve to arrest the present steady and inexorable decline in our relative shipping position. I am concerned about this. I say frankly, as a sentimentalist, that I do not like it, but
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I am much more concerned about this for the reasons given by the Clark Committee.
I do not wish—nor, I think, would any of your Lordships—to sound an unduly pessimistic note in this matter. I believe that there is much cause for optimism in viewing our Shipping industry at the present time. We have heard a great deal this afternoon to bear this out. There is a real chance that British shipping is going to be right in the van of the revolution that is now in progress in the handling of dry cargoes. For once, as my noble friend Lord Geddes remarked, we seem to be reversing the usual process with which we have all become only too drearily familiar in the post-war years. Usually it is we who invent something, we who get or to the thing first; but it is others who cash in on it commercially. This time, thanks to the energy and enterprise of all those concerned in the consortia, about whom my noble friend Lord Sandys as just spoken, we may be on the verge of being able to show a clean pair of commercial heels to our nearest competitor.
It has often been said that containerisation (to use this vile word) involves not just a change in the technique of transport of goods by sea, but also a sea-change in transportation as a whole. It holds great promise for British industry, since it means that delivery dates, to which the noble Lord, Lord Brown, so rightly attaches importance, can be forecast with far greater certainty than is possible at present. Moreover, it means that the exporter and the producer have far less stock tied up in transit at any one time. But, of course, it involves great initial capital expenditure and vast changes throughout the whole system. It involves changes in banking practice, in insurance practice, in documentation, in the role of the forwarding agent, in marketing and in customs procedure. And I should like to pay tribute to the flexibility and imagination which our customs experts have shown in bringing themselves abreast of, and coping with, these new developments in rail transport, in road haulage, in port handling, in shipping design, and not least, as my noble friend Lord Mancroft has remarked, in management.

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All this is still in its very early stages. There are many variables and many imponderables. I think that a real breakthrough in the whole of our external trade, or a large part of it, is on the cards. But as I see it, this is essentially an experimental time when all those concerned need the maximum amount of flexibility and manœuvre. This is, above all, a time when the essential criteria should be economy and efficiency. That is one reason why I share the concern which has been voiced in your Lordships' House this afternoon about some aspects, as they affect shipping, of the Transport Bill. Like my noble friend Lord Sandys, I am especially concerned about the rigid and arbitrary maximum of 100 miles. But this is not perhaps the time to go deeply into the Transport Bill: we can kill "Transport Bill", or savage it, on another occasion. The noble Lord, Lord Brown, suggested in his opening and very thoughtful remarks that the anxiety which some people entertain about this clause of the Transport Bill is possibly exaggerated. I would only say that that anxiety is, to my certain knowledge, entertained, and sincerely entertained, by some of the best and most lively brains in the shipping industry—those who are driving forward this container revolution. I would assure the noble Lord that we shall take a particularly close look at this part of "Transport Bill" when he or it reaches us, if he does, and if it does, later in this Session.
I wish to touch only briefly on the international aspects of the shipping industry. I do not propose—I am not really competent—to say anything about the real problems of flag discrimination, UNCTAD or the United States Federal Maritime Commission. Perhaps on the question of oil pollution, to which my noble friend Lord Geddes referred, and about which he knows so much, I can say this. I have a special axe to grind here as Chairman of our National Committee on Oil Pollution. I am delighted that this is being handled by IMCO, and handled so responsibly. I believe it is extremely important to maintain momentum in this field, and momentum sometimes flags when the immediate spur of urgency is removed. I would just remind your Lordships that part of the international progress which has been
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made in this field is due to informal international conferences held in London in 1953 and in Copenhagen in 1959; and I hope I shall not unduly alarm my noble friend when I say that it is the expectation that another informal and responsible international conference is likely to be held this year further to consider this whole field.
I should like to say, also, how entirely, in dealing with the international field, I concur with what my noble friend Lord Geddes said about Suez. Whether or not the Canal is reopened, it will certainly never regain its former capital importance. This makes it inevitable that the present importance of the Cape route will remain, and will indeed be steadily enhanced in the coming decade. This underlines once again, if any further underlining is necessary, the importance for this essentially maritime country of ours of the Simonstown Agreement, the importance of the ports and the sea-lanes of southern Africa, and, above all, the importance of maintaining sensible relations with one of our most important trading partners, the Union of South Africa.
Likewise, I endorse wholeheartedly what my noble friend Lord Teynham said about the need to protect our merchant shipping. One of the great changes which we have witnessed in the last decade has been the growth in Soviet maritime influence—that land animal which is rapidly becoming a very ubiquitous sea animal. Another great change has been the growth right across the world of important medium-sized navies. All this poses a potential threat to our shipping, since there are innumerable ways, well short of overt hostilities, by which our shipping can be interfered with. Given the decline in our international position and prestige, given our intended withdrawal from East of Suez, it means that our ability to counter this threat when it is growing is seriously diminished. I hope that the Government will be able to tell us, now or later, rather more than they have been able to tell us hitherto about how they propose to ensure world-wide protection of our ships upon their lawful occasions.
I should like to turn, in conclusion, to one area, and one area only, where I believe the Government can help this industry, and that is our ports. I hold

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it essential that our ports, whether they are required to cope with conventional or bulk cargoes, should be as efficient as we can possibly make them. I had some direct experience of some of our ports in the fifties, and I found it a depressing experience. I realise that a great deal has been done since then. I know that investment has been speeded up. There are major developments in hand, like the Tilbury development under the ægis of my noble friend Lord Simon. We have had the Rochdale Report, and we have had the 1964 Act and the 1966 Act. Nevertheless, I think it would be a rash man who would claim that any of our major ports are as yet as efficient as, say, Rotterdam, the premier port of Europe.
There are two points which I should like to impress upon the Government here. The first is the point to which my noble friend Lord Sandys referred; namely, the importance of road communications. Anyone who has tried to get down to London Docks or, say, to Birkenhead when they are busy knows how grossly we have neglected in the past our road communications to our ports. Doubtless much container traffic to our ports will move by rail—freight-liners and so on. Nevertheless, a vast amount of cargo, containerised or not, will move to our ports by road, and it is really vital that our road communications to and from our ports, and to and from our inland loading depots, should be vastly improved. I have not seen the new announcement about the road programme, but I am not convinced that there is, as yet, proper co-ordination at the highest level between our road development programme and our ports development programme. This is precisely the sort of strategic planning upon which the Ministry of Transport and the Minister of Transport should be concentrating. This is precisely the sort of planning which I fear tends to get neglected in the press of, perhaps, more doctrinaire legislative detail.
I should like to take just one example. If we are to have only two container ports in this country—and that is quite possible—Southampton could well be one of them. Yet what is being done about that motorway—the Midland-Southampton motorway—which was, I think, advocated in the Rochdale Report? When is it planned? I hope that
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the noble Lord may be able to tell us. All I know is that the present position is really absurd, when one sees long queues of heavily laden lorries with precious, vital cargo held up, for example, at a level crossing at Sunningdale on the A.30. It is a travesty of modern transportation.
My other concern, my Lords, is the cloud of uncertainty and the threat of nationalisation that is at present hanging over our ports. The 1966 White Paper Transport Policy, foreshadows the organisation of our ports on the basis of public ownership. We learnt rather more about the Government's proposals in the document which was published by the Ministry in July last year. I must say I found this document an extraordinarily unconvincing piece of literature. It argued that our ports should be viewed nationally and planned positively, it called for positive central planning; it demanded a strong controlling agency at the centre. I would not for one moment dispute all this. What I do dispute is the leap which the Government make from these bold, big phrases to the assumption that what we need is a National Ports Authority having overall control over a small number of regional port authorities, under which, as I understand, all our major ports would be grouped in public ownership.
I do not dispute the need for unified control, strategic control, over our ports policy. What I do dispute is that this carries with it the need for unified ownership. We have, I think, 15 major ports in this country, some controlled by public boards, like the P.L.A., some already nationalised, and some municipally owned. I believe that there is a great deal of benefit in this variety and in the competition between ports which it encourages. I very much doubt whether rising ports like Shoreham and Felixstowe would have shown so much enterprise in recent years, would have expanded as they have, had they been under a single unified ownership. When one sees how private foreign enterprise has been able to make a go of the Southampton-Le Havre short-haul sea route, which our nationalised British Railways abandoned in despair, one is not impressed by the theoretical benefits of public ownership in this sort of industry. At best I would

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hold it to be an irrelevancy, and at worst exceedingly harmful.
I am equally foxed (if I may use the colloquialism) by the Government's apparent attachment to this ideal of regional port authorities. I was myself attracted by the Rochdale plan for estuarial authorities: that seemed to me far more suited to the facts of geography. I cannot see why, just when these estuarial authorities are getting into their stride, the Government now wish to interpose a third tier of authorities. Thirdly, I read with some despair that one of the responsibilities of these new-fangled regional authorities will be to keep under review not only ports but also port facilities which are not at present nationalised, with a view to recommending them as victims for nationalisation. I can think of no surer way of making it difficult for those who are anxious to make a real go of our ports in the new and very exciting conditions into which we are moving than to have this threat suspended over managers and management.
When I expressed my disquiet about all this two years ago, the noble Lord, Lord Champion, who was then replying for the Government (and we miss him very much on the Front Bench opposite), told us:
"it may be several years hence before this Government, which clearly have before them a life of anything up to twenty years, could work out these proposals and eventually introduce them".
I suppose, my Lords, that it is just conceivable that the Government's life will not, after all, endure for that further twenty years. In any event, I hope that the Government will pause before proceeding with this proposed legislation.
I do not claim that Rochdale, as enacted by a Conservative Administration, was perfect. I should have preferred a Ports Council with far stronger and sharper teeth. But it would be a quite simple piece of dentistry, one of which even a U.A.R. dentist would be capable, to supply the Council with stronger teeth without embarking on all this controversial and complicated paraphernalia of more public ownership and more bureaucratic top hamper. In his opening speech the noble Lord, Lord Geddes, quoted some words that I was rash enough to use in our debate eight years ago. I
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think that I then referred to the need for a real and fruitful partnership between this industry and Government, Governments of whatever political complexion. I hold to those words, my Lords. I agree with my noble friend Lord Mancroft that Government will often be advised to keep clear of the industry's propellers. Nevertheless, there is much scope here for co-operation, much that the Government can do to help. Quite a number of ways, I believe, have been suggested in this debate to-day, and I think that the Government would be well advised to ponder, and to ponder carefully, those suggestions.
6.46 p.m.
LORD BROWN: My Lords, I think this has been a particularly good debate because of the quality of the contributions, because of the start that was given to it by the noble Lord, Lord Geddes, which was essentially practical and factual, but particularly because we are holding the debate in the presence of the noble Viscount, Lord Rochdale, who happens to be Chairman of the Committee which is going into areas perhaps even beyond those we have discussed to-day; but certainly I think that nothing that has been said this afternoon in this debate lies much, if at all, outside the ambit of their terms of reference.
May I start with some earlier remarks which the noble Earl, Lord Jellicoe, made. He asked some fundamental questions about whether the Government were concerned about the size of the shipping industry, and at which point a reduction in size, if there is to be a further reduction in size, should be halted, et cetera. These were fundamental questions, and I am not brushing them aside by saying "et cetera": I simply do not want to repeat all he said. This seems to me a problem analogous to the other problem which the Government have been trying to tackle—not only this Government but their predecessors—and that is the problem of rail and road transport.
Here we have sea and air transport, and this is made more complex by economic factors, such as the ability to earn foreign currency overseas, fiscal matters connected with overseas subsidies and preferences given to other shipping companies, international problems, with flag discrimination, and priorities for investment. It even goes into the question of

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internal divisions of labour. Shall we be able to be carriers on the high seas to the world to the same extent that we used to be, if ships in future are to be manned by other countries, who may not have the same high standard of living. These questions all face us. Lastly, I sympathise with the noble Earl: we have the sentimental aspect because—I nearly said every Englishman loves his ship, but as a Scot I will not allow myself that liberty. Also, of course, the question of national security in time of war is important. I cannot attempt to answer the noble Earl's questions to-night. We have asked Lord Rochdale to go into these matters. I think it has been very interesting that these matters should have been raised in this way in his presence.
EARL JELLICOE: My Lords, I am sorry to interrupt the noble Lord so early in his reply, but could I ask him this question? I did not expect him to be able to say that we should arrest this relative decline at x level, but would he agree with me and, I think, with his noble friend behind him that there is a level at which we should be wise, in our own interests, for a number of reasons, to arrest it or do what we can to arrest it?
LORD BROWN: My Lords, I should agree with that. I think the noble Earl used the phrase "apparently complacent". Since I have become a Minister in this Government I have learnt that one of the dilemmas of politicians is this: if you are critical of a situation you are denigrating it; if you are less than critical you are complacent about it. I do not know where the intermediate point is. However, I will agree with the noble Earl and accept his words. There could come a time when very rigorous action would have to be taken to see that the decline was arrested. I should not like to offer an opinion as to where that point is.
May I now turn to the related debate which took place, really, between the noble Lord, Lord Hill of Wivenhoe, whom I congratulate most heartily on a very interesting maiden speech, characterised by that controlled steam pressure we associate with his name, and the noble Viscount, Lord Runciman, who I thought made—I will use the word "brilliant" because it was a brilliant analysis which led in strict logic, in which
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I did not detect any flaws, to what looked like a relatively simple solution to the growth problems of the industry. He rejected subsidies, and I agree with him. He rejected the idea of facing the discrimination of others with discrimination by ourselves. On the whole I agree with him, although there comes a point when one has to retaliate in kind. But God forbid! that it should come too early, because this is the way in which to lead the world into a thorough mess.
If I understood him rightly, the noble Viscount came down in favour of a retention of the withholding tax. If I were the Chancellor I might have had the courage to say that I was impressed; as I am not the Chancellor, I definitely have that courage, but whether the noble Viscount's arguments will be as convincing to the Chancellor after they have been processed by the noble Viscount, Lord Rochdale, I do not know. Although he drew attention to the growth in the size of the Norwegian shipping fleet, and said that the Norwegians were better off, those who have brought me to the point of knowledge required to take part in this debate have assured me that the Norwegians are only marginally better off than British shipping companies in respect of the whole nexus of taxation. There is an argument there, and no doubt it can take place between those who know more about it than I do. But it seemed to be a slight flaw in the noble Viscount's argument.
Turning to the argument on the other side of the penny, from the noble Lord, Lord Hill of Wivenhoe, I do want. want to introduce a controversial note, but I must say that some of his statistics really surprised me. As he was speaking, I pulled out the Report of the Chamber of Shipping and the Clark Report, and there was no consistency between the figures which the noble Lord was quoting and those I was looking up. I would be happy if the noble Lord would accept a letter from me, picking up some of the statistics he has quoted, and giving what we in the Board of Trade, with respect, regard as the proper figures. It seemed to me that his main argument got a little near the point of chauvinism. I have great sympathy with an industry employing men of the sea who watch the size of the industry shrinking in the way it has been doing in recent years, but the

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comments made by the noble Lord, Lord Geddes, were an adequate explanation of at least a major part of the reason for this shrinkage. If in the past we have been a major exporter of fuel to others and, by the changes in the way in which we create our energy, we become a major importer instead, this must have a great influence on the size of our fleet.
I do not want to sound complacent, but if one looks at the comparison with other countries I think it will be apparent to the noble Lord, Lord Hill, that his anxieties are inflated, at least. One has to face the fact that a country like Norway, for example, clearly does not have the same alternative options for their investment as this country. In an intuitive way we may have chosen to invest less in shipping than other countries, and history may show that we have made the right choice. Aero engines may turn out to be a good way of investing money in this country, and certainly the advancing front of electronic technology is a good one. A country like ours cannot go on being the best at everything, as it has sometimes been in the past. It has to choose its objectives and be good at those. Whether shipping will remain one of these, I do not know, but I certainly agree with the noble Earl, Lord Jellicoe, and hope that it will remain one of our long suits. I am sure the noble Viscount, Lord Rochdale, will help to guide us in the future.
Turning to the questions of personnel and manning, we have had contributions by the right reverend Prelate the Bishop of London and the right reverend Prelate the Bishop of Winchester and, if I may say so, an excellent contribution from the noble Viscount, Lord Simon. We have also had some comment from the noble Lord, Lord Teynham. I can answer the noble Lord's question on the subject of unemployment benefit while people are undergoing training. It has been withdrawn, in spite of arguments by the National Maritime Board, who saw the Minister of Labour. Those arguments were not accepted, and the industry is now paying people while they are in training. This is completely consistent with the general attitude to industry, and the shipping industry has had a quite unique benefit in this respect, which has now been withdrawn. As one who is very
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much alive to the value of training, I am in a sense disappointed that this should have happened, but it is in accordance with Government policy, so far as possible, to treat industries alike. The noble Lord was quite right to draw attention to this as a material point in this debate.
The noble Viscount, Lord Simon, drew attention to the serious problem which applies not only in the shipping industry but in most other industries—namely, the problem of loss of faith by those who elect representatives when those representatives, in the light of circumstances disclosed to them, fail to attain the objectives which it had been hoped they would achieve. I cannot indulge in a long lecture on this subject, much as I should like to because it is a topic very dear to my heart. I do not think this is a matter of communications; I think that that is merely a bromide word which enters into this sort of discussion. Communications are a function of the existence of clear-cut social institutions, and it is the setting up of clear-cut social institutions which leads to good communications.
By waiting for good communications I think we miss the point. We want proper constitutions setting out the rules. when people meet, in shipping as elsewhere, not so that when crises arise people can be called together and given for the first time the responsibility of facing a problem which hitherto has been dealt with by management—in this particular case unsuccessfully—but so that management and those employed in industry can regularly spend time devising policies within which management can manage that industry. These discussions, which go on with regularity, should be concerned with initiating the creative things in the industry as well as with dealing with the problems that have been brought to it. This is a general comment on which I could expand. Indeed, I have written books on the subject, but I will leave it at that.
LORD CHAMPION: No advertising!
LORD BROWN: The noble Lord, Lord Somerleyton, gave us a very interesting maiden speech, and I congratulate him on the content of what he said. He drew attention particularly to the problems of shipyards in the non-development areas. I do not want to say too much about

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that to-night, because the shipyards are not the only industries that feel themselves to be the victims of living in "grey" areas—and I think the House knows what I mean by "grey" areas: those near to, or possibly feeling themselves to be in, similar conditions to those of the development areas themselves. I think noble Lords are aware that the Hunt Committee has been set up particularly to look at this problem, and it is hoped sincerely that it will report in late summer or early autumn—but, as with all these prophecies about dates of reports, one cannot be precisely certain that that is when we shall see it.
The noble Lord, Lord Sandys, with respect, gave us a contribution that was more largely based on bitterness than any of the other contributions this afternoon. I felt at times, when he was referring to the failure of our exports and the failure of almost everything he mentioned, that perhaps he had been paying too much attention to our Press. I heard somebody at lunch to-day make what I thought was a rather brilliant remark worth repeating. He said that so far as getting attention by the Press is concerned, nothing succeeds so well as failure. That is extremely true, and many of the matters to which the noble Lord, Lord Sandys, drew our attention were expressed in rather more pessimistic terms than I would use. I hope he is not right. He referred to shipping companies and the problem of selective employment tax. The shipping companies do get refunds if the number of seafarers exceeds the number of office staff. He also referred to the problem of the invisible exporters not qualifying for the Queen's Award. This is generally true owing to the enormous difficulties of coming to a basis of assessment, but the shipping companies can qualify on the basis of technical innovation, and I should like to see one get an award for some of the new forms of transportation which are being evolved.
Turning now to the problem of security at sea, I think I can do no better in answer to the noble Lord, Lord Teynham, and the noble Earl, Lord Jellicoe, than repeat part of a statement which my honourable friend Mr. Foley, the Under-Secretary of State for the Royal Navy, made as recently as March 11 in another place:
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"I know … that some of the British merchant shipping community are worried lest the recent defence announcement leaves them more exposed to piracy.… I appreciate their anxieties, but coastal piracy poses no immediate threat on any scale to British shipping and, as I have explained, for many years now the Royal Navy has not been able to patrol continuously all the sea lanes East of Suez. …Piracy … is, however, primarily a problem for the commercial shipping community as a whole.… Aid to merchant shipping in distress is a duty which the Royal Navy has always accepted and will continue to accept. It is important, however, not to get a false impression of the demands which this makes on the Royal Navy. Over the last five years the Royal Navy has assisted merchant ships on 36 occasions. None of these was an instance of piracy. … The White Ensign will not disappear from the oceans of the world after the Navy withdraws from the Gulf and Singapore and concentrates itself in the European and Atlantic areas. Apart from the naval forces which may be available elsewhere from this general capability as in our judgment circumstances demand, there will continue to be opportunities for Visits and exercises outside what we may call these two home theatres."—[OFFICIAL REPORT (Commons), cols. 1017–8; 11/3/68.]
May I add this? I think we must keep a firm grip on ourselves; emotion and sentiment can run away. I do not think the Norwegians and Greeks have been specially bothered by the fact that they have not got a Navy safeguarding their growing shipping in many areas of the world. If this is to become a problem in terms of piracy or interference, eventually it must become an international and not a national problem. If we are to take on the burden for our ships by providing protection in all the sealanes which they use, and see other countries escape the duty because they cannot face it but with their growing fleets rely on us or the Americans or on international co-operation, we are going, to put ourselves in a very unfortunate position. It is appealing to feel the Royal Navy is there to help the Red Ensign whenever the need arises, but I fear very much that this is an image that will fade. I think we have got to face this.
My noble friend Lord Hill of Wivenhoe, the noble Viscount, Lord Runciman of Doxford, and the noble Lord, Lord Mancroft, have all expressed deep concern about subjects associated with flag discrimination, subsidies, slanted safety regulations at sea, preference laws and so on. When the Kennedy Round was recently completed and brought into

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being, most of the major countries of the world, I think, had come to the conclusion that the great danger brought about by reduction of tariff preferences between countries was an insidious attempt to substitute something else for the protection which has disappeared in this way. Non-tariff preference is a very wide term and the sort of practices to which reference has been made fall within its ambit, and there is a growing international sentiment—indeed, there are discussions behind international action—to deal with non-tariff preferences of a wide sort. I can only say that these are clearly international matters, and the interest of Her Majesty's Government in an international discussion of non-tariff preference will include the sort of anxieties expressed in this debate. And I hope that international meetings on these subjects will come as early as possible. I cannot at this moment of time say any more about the possibility of this arising.
I come now to almost the last point, and that is the point made by the noble Earl, Lord Jellicoe, on our ports. I cannot reply to the points he has made about road transport to our ports. As an exporter myself, I think it is an extremely important point. I think that the delays at our ports are becoming a very serious impediment to continued exports to some markets. Some markets depend on speed, particularly for consumer goods, and these delays are dreadful. But a debate on shipping did not give me the necessary intuitive warning that it might spill over into the road transport field, and I have not armed myself to talk intelligently on this subject. Perhaps the noble Lord will excuse me. Nevertheless, I share his anxiety.
On this matter of nationalisation, I am afraid that the hour is fairly late, and we shall have to agree to differ. I am not myself, I hope, prejudiced in this matter, but two years on the National Modernisation Committee brought me a long way towards the belief, reluctantly perhaps, that it would be better to get this into national hands. After all, we must remember that a very large proportion of the physical assets of the ports are already publicly owned, in one form or another and that integration of some of
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these will be essential. The noble Earl is, I think, worried about the fact that the sort of progress that has been made since the war by a port such as Felixstowe, will be stifled in the future. I think it would be fair to add that the fact that a port like Felixstowe can make such progress has been due to some extent to the appalling problems created by casual labour in the other ports. If the other ports had had a firmer grip on the situation, with the smaller number of employers having a permanent labour force attached to them, the efficiency of those ports might have been such that these smaller ports would never have developed, because in one sense they are not economic—that is, in the sense that industry cannot be sure of the frequency of sailings from the smaller ports that is demanded for rapid passage of exports. The case for a large number of small ports has not, in my view, been made out. However, on this issue the noble Earl and I will have to differ.
It has been a source of great satisfaction to the Government that such a wise and experienced Member of your Lordships' House as the noble Viscount, Lord Rochdale, has agreed to chair the Committee that has been set up. I close, therefore, on this note. The terms of reference of his Committee are wide and cover our debate. I hope that the members of his Committee will read their Hansard thoroughly, because your Lordships' House has spent getting on for five hours in giving evidence in one sense; and I count myself as fortunate to have been put in the position, on this, I think, the first Wednesday debate I have dealt with, of giving evidence, so to speak, instead of having to try to answer all the many deep and searching questions which have been asked, because they do need deep interrelated consideration.
7.12 p.m.
LORD GEDDES: My Lords, I shall not detain your Lordships any longer this evening, other than just to say how grateful I am to all those noble Lords who have contributed to this debate. I believe that we have had a most valuable afternoon, one which I know will be treasured by the shipping industry,

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and one for which all those who serve us at sea will be grateful to your Lordships. I should particularly like to say "Thank you" to the two noble Lords who made their maiden speeches this afternoon. It was a great tribute to the shipping industry that they should choose this occasion to make their maiden speeches. It only remains for me to beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

UNIVERSITY OF SALFORD BILL ROYAL COLLEGE OF ART BILL
Brought from the Commons; read 1a, and referred to the Examiners.

EPPING FOREST (WATERWORKS CORNER) BILL [H.L.]
Returned from the Commons, agreed to with Amendments.
House adjourned at thirteen minutes past seven o'clock.