Sitting of 8 July 1968

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

  SUEZ CANAL
  Mr. Martenasked the Secretary of State for Foreign Affairs if he will make a statement about the continued blockage of the Suez Canal.
  The Secretary of State for Foreign Affairs (Mr. Michael Stewart): The Special Representative of the United Nations Secretary-General is continuing his efforts to promote a settlement in the Middle East on the basis of the Security Council Resolution of 22nd November, 1967, which amongst other things affirmed the necessity for guaranteeing freedom of navigation through international waterways in the Middle East.
  Mr. Marten: As the Israelis object to letting these ships out of the northern end of the Canal, can the Foreign Secretary say what steps the Government have taken to try to arrange for the clearing and the unblocking of the southern end
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  of the Canal by forces which are neither Egyptian nor Israeli but international under United Nations supervision, because this, if there is any logic in the case, seems to be the only way to overcome the present problem?
  Mr. Stewart: I do not think that I can pronounce on that way of dealing with it, but I am in touch with all the Governments concerned and with some of the private interests concerned, and I hope that we shall be able to make progress.
  Sir B. Janner: Why does not my right hon. Friend consider doing something about the suggestion which has just been made? Have not Israel, Egypt and the United Nations agreed to let the ships go through the southern passage and are not the only people causing difficulties about the northern passage the Egyptians, who will not agree to abide by the Security Council's decision?
  Mr. Stewart: It would not be sensible for me to make pronouncements about the exact responsibility of any party at this stage. We must hope that the work which Dr. Jarring is doing will produce results.
  Sir G. Nabarroasked the Secretary of State for Foreign Affairs what further progress he has made in securing release of British Ships trapped in the Suez Canal.
  Mr. Biggs-Davisonasked the Secretary of State for Foreign Affairs what progress has been made with securing

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  the release of British ships trapped in the Suez Canal.
  Mr. Shinwellasked the Secretary of State for Foreign Affairs with which Governments Her Majesty's Government are negotiating on freeing British vessels laid up in the Suez Canal.
  Mr. Ridsdaleasked the Secretary of State for Foreign Affairs what further steps he has taken in the last month to bring about the release of the British ships blocked in the Suez Canal.
  Mr. M. Stewart: Her Majesty's Government have continued their efforts to bring about fresh arrangements for the release of the blocked ships, but I remain unable to forecast when the ships will be released.
  Sir G. Nabarro: Having regard to the fact that Her Majesty's Government have obtained no satisfactory answer from Nasser, is not the policy of the Foreign Office again demonstrated to be a total flop? Will the Foreign Secretary now give the House an assurance that no British money will be lent to Egypt until our ships are freed from the Canal?
  Mr. Stewart: No, Sir. I do not think that that would help.
  Sir G. Nabarro: It would help, you know.
  Mr. Stewart: If I wanted advice on how to handle the Suez Canal, I should not look across to the other side of the House to get it.
  Mr. Biggs-Davison: Is the Foreign Secretary aware that his party's record at the time of the Suez intervention was disgraceful? [AN HON. MEMBER: "Who's talking?"] Does the Foreign Secretary think that the latest statement by the Israeli authorities on their attitude to an attempt to release the blocked ships is significant? Will he comment on that? Is he further aware that we shall be more inclined to take seriously alleged peaceful professions from President Nasser when he shows himself cooperative in releasing these ships?
  Mr. Stewart: The answer to the first part of the question is, "Certainly not". With regard to the remainder, there have been, both in the statement to which the hon. Member has referred and from
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  other quarters, signs that we may be able to make progress. I think that everyone will understand, however, that this is a difficult and complicated matter, and it would not be helped by pronouncing judgments of the kind pronounced by the hon. Member at the end of his question.
  Mr. Ridsdale: Can the Foreign Secretary say what last communication he has had from Dr. Jarring about this question? If unsatisfactory answers continue, will the right hon. Gentleman raise the matter again in the Security Council?
  Mr. Stewart: I shall be seeing Dr. Jarring tomorrow and I shall have to consider whether any further steps of the kind suggested by the hon. Member are appropriate after that.
  Mr. Colin Jackson: Would not the Foreign Secretary agree that one of the problems may well be that the Israelis are unwilling to allow dredging ships and other equipment to move from Port Said down to Ismailia so that the channel may be cleared?
  Mr. Stewart: Of course, that is one of the difficulties, but my hon. Friend will realise that it is not the only one.
  Mr. Dalyell: Is my right hon. Friend aware that those of us who have been on board these ships and have been working with Lloyd's in this matter have come to have a high regard for the work of the Foreign Office in this complex problem?
  Mr. Stewart: I am obliged to my hon. Friend for what he has said.
  Mr. Eldon Griffiths: Would not the Foreign Secretary agree that there are some hopeful signs in the statement made by Col. Nasser in Moscow and also the evidence of increasing American pressure on Israel? Does he not realise, however, that what upsets people in Britain is the feeling that we, who have so many ships there, are unable to have the same effect on the protagonists as have the Soviet Union and the United States?
  Mr. Stewart: I am not sure that that is true. This matter, unhappily, has remained unsettled despite the Security Council resolution and despite the interests of a great many Powers. We shall all have to continue to work on it.

  UNITED NATIONS

    Abolition of Slavery (Convention)
    Mr. Archerasked the Secretary of State for Foreign Affairs whether he will make proposals at the United Nations, with a view to the establishment of machinery to implement the Supplementary Convention on the Abolition of Slavery, comparable with that relating to the Convention on Refugees.
    The Minister of State for Foreign Affairs (Mr. Goronwy Roberts): The Economic and Social Council has recently decided to establish a list of experts to advise States concerned with liquidating slavery and the slave trade. I think we must see how this works before proposing new measures. But I shall meanwhile try to arrange for my hon. Friend's interesting idea to be considered in the course of a study of measures to implement the slavery conventions which will shortly be initiated by the United Nations Sub-Commission on the Prevention of Discrimination and Protection of Minorities;.
    Mr. Archer: I thank my right hon. Friend for that Answer. Does he not agree that every day during which the Supplementary Convention remains a dead letter is a further day of personal tragedy for millions of people? Will he make sure that it does not continue to remain a dead letter?
    Mr. Roberts: I expect that this sub-commission which I mentioned will have a very close look at the implementation of the two Conventions.

    Nuclear Weapons (Non-Proliferation Treaty)
    Mr. Dodds-Parkerasked the Secretary of State for Foreign Affairs what reasons have been given to him for the delay in the signature of the Treaty on non-proliferation of nuclear weapons by members of the United Nations.
    The Minister of State for Foreign Affairs (Mr. Fred Mulley): There has been on delay. The Treaty was opened for signature on 1st July and remains open for further signatures. More than 60 countries have already signed in one of the capitals of the depositary Governments.
    Mr. Dodds-Parker: Can the right hon. Gentleman assure the House that all our Commonwealth and N.A.T.O. allies have signed and accept that our signature safeguards their legitimate interests?
    Mr. Mulley: I cannot give that assurance, because the fact is that all the Commonwealth countries and all the N.A.T.O. members have not yet signed. Some N.A.T.O. members like France have made their position clear. France will not sign or ratify the treaty but will observe its terms. It is only two weeks since the United Nations recommendation was passed and in these matters—in one or two cases Governments are still under formation—it will take a little time. I am, however, confident that the great majority of countries will ratify the Treaty in due course.
    Mr. Martenasked the Secretary of State for Foreign Affairs if he will make a statement about the effect of the non-proliferation Treaty upon the transfer of nuclear weapons from America to Great Britain.
    Mr. Mulley: Under Article I of the non-proliferation Treaty, nuclear-weapon States party to the Treaty undertake not to transfer nuclear weapons to any recipient whatsoever. The domestic legislation of the United States Government already prohibits such transfers.
    Mr. Marten: As one nuclear Power can assist another nuclear Power in the manufacture of nuclear weapons under this new Treaty, does that mean that America could allow Britain to manufacture American tactical nuclear weapons in this country under licence?
    Mr. Mulley: The passing of information between two nuclear States is not ruled out. What is ruled out is the passing of any information whatever by a nuclear State to assist a non-nuclear weapon State to acquire nuclear weapons. It is, however, possible for information to be exchanged between nuclear weapon States. On the serious question that the hon. Gentleman has raised, it would be unwise to answer hypothetical questions of that magnitude off the cuff.
    Sir Alec Douglas-Home: The Minister can answer a question of fact. Is it not a fact that the United States would be allowed to assist us in manufacture and would also be allowed to give us the delivery systems for nuclear weapons?
    Mr. Mulley: I should make it clear that the non-proliferation Treaty is concerned only with the explosive warhead element. There is no prohibition on the transfer of the means of delivery which, in the simplest sense, are combat aircraft.
    Mr. Frank Allaunasked the Secretary of State for Foreign Affairs if the Government will ratify the nuclear non-proliferation agreement at an early date; and if, following the draft treaty, he will maintain the Government's policy of the abolition of the British independent nuclear force.
    Mr. Atkinsonasked the Secretary of State for Foreign Affairs what is the policy of Her Majesty's Government regarding the permanent retention of nuclear weapons, following their signature of the non-proliferation agreement.
    Mr. Mulley: Her Majesty's Government signed the non-proliferation Treaty on 1st July and intend to ratify it at an early date. We do not, however, think that we would make any significant contribution to progress on disarmament and the strengthening of world peace by unilaterally abandoning our nuclear weapons at this time, nor is this required in any way by the non-proliferation Treaty.
    Mr. Allaun: I welcome this big step forward, but will my right hon. Friend give the House an assurance that the guarantee to the non-nuclear nations should not be used as an excuse for abandoning our election promise to give up the so-called independent nuclear deterrent—which would probably be the best contribution that we could make to a nuclear disarmament agreement?
    Mr. Mulley: I have made it clear on previous occasions, as have many of my hon. and right hon. Friends, that we do not see our nuclear weapons in any independent category at all. In fact, our giving the security assurance to the United Nations and to the non-nuclear weapons States was done in concert with the other nuclear Powers and in no sense is this to be interpreted as a desire to keep an independent nuclear capability.
    Mr. Atkinson: Is my right hon. Friend aware that the Labour Party has long argued that the signing of a nuclear non-
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    proliferation treaty between the Soviet Union and the United States would give Britain an opportunity to take unilateral nuclear action? If the Minister is now saying that it is Britain's intention to maintain her nuclear weapon as a means of underwriting her guarantees to non-nuclear States, is not this a contradiction of our original intention?
    Mr. Mulley: With respect, my hon. Friend is not quite clear about the purpose of the non-proliferation treaty. It is to prevent a spread of nuclear weapons to powers which at the moment are not nuclear weapon States. I give the assurance that we should not let our nuclear policy in the future be coloured by this security guarantee. If for other reasons it became appropriate for us to cease to be an independent nuclear weapon State, I am sure that a satisfactory arrangement in that respect could be made.
    Mr. Martin: Can the Minister confirm that we have the ultimate right to use our independent nuclear weapons in defence of this country's vital interests, and to that extent is not our nuclear weapon a British independent nuclear weapon and not a "so-called" one?
    Mr. Mulley: These points have been argued on many occasions. I cannot conceive of any circumstances when any British Government would wish to use nuclear weapons independently. I have constantly asked hon. and right hon. Gentlemen opposite to make suggestions as to when they think it could conceivably be in our interests to do so and so far I have had no answer.
    Mr. Philip Noel-Baker: Since the Committee of 18 has spent six very dangerous years on what it calls "collaterals", will the Government now seek to turn their attention to the abolition of weapons of mass destruction by general agreement, to which Conservative Governments committed themselves for so many years?
    Mr. Mulley: I hope to make some very positive suggestions on 16th July when the 18-Nation Disarmament Committee reconvenes. I can give my right hon. Friend the assurance that there will be no delay in progress on account of the United Kingdom Government. We shall be very happy to support initiatives in any direction that looks fruitful
    Sir Alec Douglas-Home: Is it not time to give us the facts? Are not the facts that we have the legal right to withdraw our nuclear weapons from the N A.T.O. Alliance, to which they are subscribed, at any time we might wish to protect our vital interests? Is not that the situation.
    Mr. Mulley: If we look at the N.A.T.O. Charter we see that the commitment on member countries in legal terms is very little. It is only in the event of an attack to consider what help to give I hope that the right hon. Gentleman will not go right back and seek to start N.A.T.O. all over again. We have painfully built up an instrument of collective security and I have heard no suggestion that it should be broken up.
    Sir Alec Douglas-Home: May I pursue this matter? Is it not a fact—and the right hon. Gentleman has only to say "Yes" or "No"—that we have a right to withdraw these nuclear weapons should we so desire for the protection of our own vital interests? Is not that the fact of the matter?
    Mr. Mulley: As the right hon. Gentleman knows very well, the position is that all N.A.T.O. members have the right to withdraw their forces, including nuclear weapons, from the defence of the alliance, but I hope that that is not a course that he is recommending to the House.
    Mr. Mendelson: Will my right hon. Friend bear in mind that whatever further improvements in respect of nuclear disarmament hon. Members might have, this is a step in the direction of creating confidence, and without confidence among the nuclear Powers no further positive policy is possible? The Government should be congratulated on their achievement.
    Mr. Mulley: I am grateful to my hon. Friend, and the House should be grateful to him for underlining a most important aspect of the non-proliferation Treaty, namely, that it has become possible through close co-operation between the nuclear Powers at a time when there are many other difficult international problems.

    Sea Bed (Maltese Proposals)
    Mr. Dalyellasked the Secretary of State for Foreign Affairs if Her Majesty's Government will support the
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    proposal of the Government of Malta at the next United Nations General Assembly for a declaration on national rights over, and exploitation of, the marine environment for the benefit of mankind.
    Mr. Goronwy Roberts: The Maltese proposal related to the sea bed only. Her Majesty's Government are actively considering their policy towards this most interesting subject in the light of the ad hoc committee at the United Nations set up to study this whole question.
    Mr. Dalyell: Is my hon. Friend aware that if there is to be an adequate flow of capital and investment certain urgent problems of international law, especially patent law, must be solved?
    Mr. Roberts: I agree. A large number of complex and difficult questions—some technical and others legal—will have to be very carefully studied both in the ad hoc committee of which we are a member—having been the co-sponsor of the Resolution setting it up—and also in the several States.
    Mr. Hugh Fraser: Would it not strengthen the Government's hand enormously at the United Nations if they had their own proper study of marine technology, like every other major maritime Power? In spite of the fact that the Government have been pressed by hon. Members on both sides, we have had nothing except the vapourings of the Minister of Technology.
    Mr. Roberts: I do not accept the hon. Member's implication. I am aware of his keen interest in the matter. I suggest that through the existing Departments and the special bodies that the Government have set up this matter is adequately taken care of.

    European Convention on Human Rights
    Mr. Huntasked the Secretary of State for Foreign Affairs when the United Kingdom now proposes to ratify the fourth protocol to the European Convention on Human Rights.
    Mr. Goronwy Roberts: Her Majesty's Government do not at present propose to ratify this protocol.
    Mr. Hunt: Is it not a fact that this protocol has already been ratified by

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    many countries, including Norway, Sweden, Denmark and Germany? What is the stumbling block for Her Majesty's Government?
    Mr. Roberts: Five countries have so far ratified this protocol, none of which has quite the same difficulties as we have over immigration.
    Mr. Whitaker: Will my right hon. Friend do all in his power to obtain a United Nations Commissioner for Human Rights in Human Rights Year? Does he think that the chances of doing so are favourable?
    Mr. Roberts: We have expressed our support for this proposal. Although I cannot confidently say so, we expect that this will be implemented some time this year.

  COUNCIL OF EUROPE (GREECE)
  Mr. Archerasked the Secretary of State for Foreign Affairs whether he will make proposals at the Council of Europe, with a view to the conducting of an investigation into allegations of torture by security police at Dionysos Camps.
  Mr. Mulley: Questions of violation of Human Rights in Greece, including allegations of torture, are already being considered in the European Commission of Human Rights.
  Mr. Archer: Does my right hon. Friend agree that this is a completely new allegation and that if it is true, it is a very serious matter? Does he agree that if it is true, irrespective of the political complexion of the Government which has committed these offences, questions of human rights are not pronouncements about political differences?
  Mr. Mulley: I agree that those considerations should be kept apart, but I do not think that my hon. Friend appreciates that the matter was formally put to the Human Rights Commission by the Danish, Norwegian and Swedish Governments on 25 th March and that the independent judicial investigation is in their hands and that we cannot attempt to interfere with that process.
  Viscount Lambton: Will the right hon. Gentleman say whether he had any comments on the tortures from the all-party delegation which went to Greece?
  Mr. Mulley: We had reports from the all-party delegation, but I do not think that its members would claim to be in a position to submit an independent investigation of the kind which we hope the European Commission is now conducting.

  U.S.S.R. (MR. GERALD BROOKE)
  Mr. Blakerasked the Secretary of State for Foreign Affairs if he will make a statement about the latest position in regard to Mr. Gerald Brooke.
  Mr. M. Stewart: Yes, Sir. The Soviet authorities gave their consent to a meeting in Moscow by the Acting Consul with Mr. Brooke, which took place on 20th June, and lasted for 35 minutes.
  Mr. Blaker: Is it not rather deplorable that this was the first meeting which Mr. Brooke had been allowed to have with a British consular officer for more than a year? Can the Foreign Secretary give the House any assurance about Mr. Brooke's state of health and the likelihood of more frequent meetings with consular officers in future?
  Mr. Stewart: I think that it was deplorable that it was so long since the previous visit. I raised this matter with Mr. Gromyko when I was in Moscow recently and this visit subsequently occurred. I think that one can say that Mr. Brooke's health is as good as can be expected and not as was at one time feared. As to more frequent visits, the Soviet Government is aware that we are ready to exchange ratifications of the Consular Convention within a month of its informing us that it will do the same. When that Convention is ratified, Mr. Brooke and others in his position will be entitled to regular visits.

  SOUTH YEMEN
  Mr. Dodds-Parkerasked the Secretary of State for Foreign Affairs what final financial settlement has been made between Her Majesty's Government and the Government of South Yemen.
  Mr. Goronwy Roberts: No final financial settlement has yet been made between Her Majesty's Government and the Government of Southern Yemen.
  Mr. Dodds-Parker: In the meantime, can the Minister say whether pensions are being paid both to those resident in Aden and to expatriates, and whether British commercial operations are being allowed to function properly?
  Mr. Roberts: The answer on both counts is, Yes.

  RHODESIA
  Sir G. Nabarroasked the Secretary of State for Foreign Affairs what further discussions he has had, and with what results, with representatives of all foreign non-Commonwealth countries trading in arms, in oil, in manufactures, and in other merchandise with Rhodesia, thus defeating United Nations' mandatory sanctions; and whether he will make a statement.
  Mr. Goronwy Roberts: I have nothing to add to the reply which my right hon. Friend the Minister of State for Foreign Affairs gave to my hon. Friend the Member for Wandsworth, Central (Dr. David Kerr) on 20th May.—[Vol. 765, c. 3–5.]
  Sir G. Nabarro: Is the Foreign Office prepared to allow this matter to go by default? Is the Minister aware that the Rhodesian market, today lost to Britain, is now flooded with Japanese, West German, French and Italian motor cars and manufactured goods to our detriment? Why is he handing over this valuable trade to our foreign competitors?
  Mr. Roberts: The recent resolution on comprehensive mandatory sanctions will have two effects: to improve the operation of sanctions against the illegal régime and also to correct the disbalance of trade, which the hon. Member has so eloquently described.
  Mr. Biggs-Davisonasked the Secretary of State for Foreign Affairs whether he will move to refer to the International Court of Justice the question of the legality of mandatory United Nations sanctions against Rhodesia.
  Mr. Goronwy Roberts: No, Sir.
  Mr. Biggs-Davison: Does the right hon. Gentleman think that Mr. Dean Acheson is a bad international lawyer? Has he taken account of the views of him and of other very distinguished legal luminaries that this whole matter is lawless? Are the Government afraid to submit it to an international tribunal?
  Mr. Roberts: We are, of course, aware of Mr. Acheson's opinion, and, much as we may respect him, nothing he has said has given us, or any other member of the Security Council which agrees with us, cause to reconsider our opinion. The hon. Member will recollect that, differently from the first resolution on sanctions in 1966, this was one which was voted for by every member of the Security Council. None of them had any doubt about the legality of their action.

  MIDDLE EAST
  Mr. Waltersasked the Secretary of State for Foreign Affairs if he will make a further statement on the situation in the Middle East.
  Mr. Juddasked the Secretary of State for Foreign Affairs whether he will make a statement on the situation in the Middle East.
  Mr. St. John-Stevasasked the Secretary of State for Foreign Affairs if he will make a statement of policy on the situation in the Middle East.
  Mr. Colin Jacksonasked the Secretary of State for Foreign Affairs if he will make a statement on the present situation in the Middle East.
  Mr. M. Stewart: Since my Answer to the hon. Gentleman the Member for Westbury (Mr. Walters) and the noble Lord the Member for Berwick-upon-Tweed (Viscount Lambton) on 20th May, the Special Representative of the Secretary-General, Dr. Jarring, has started on a new discussion with the parties principally concerned in New York and in Europe. As this round of discussions is continuing, I should prefer to make no statement for the time being.—[Vol. 756, c. 8–9.]
  Mr. Walters: Is the Foreign Secretary satisfied with the influence which the

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  British and United States Governments are having at present on both protagonists, who have been making more conciliatory statements recently? Particularly with regard to Israel, is it not unfortunate that the Israeli position should have excluded Jerusalem from negotiations in advance, which seems to make the negotiations almost impossible?
  Mr. Stewart: I am in touch and I hope that we are having all the influence we can with the parties concerned. I must say again, however, that I am not prepared to make ex parte pronouncements on particular aspects of the dispute.
  Mr. Judd: Would not my right hon. Friend agree that the resolution which we sponsored at the United Nations continues to provide the most helpful basis for a solution to the Middle East crisis and that we should bring home to all the parties involved that their full cooperation is necessary if the resolution is to succeed?
  Mr. Stewart: Yes, that we have done and are doing. My hon. Friend will be aware that the resolution contains, as was inevitable, some parts which are more acceptable to one side than to the other, and that the reverse applies to other parts of the resolution. The task is to get all parties to accept all that is implied in the resolution.
  Mr. St. John-Stevas: Would not the most useful thing for the Foreign Secretary to do at this moment be to facilitate direct negotiations between Israel and Jordan to secure a lasting territorial settlement of the Palestine question?
  Mr. Stewart: The hon. Member will, I think, realise that there are difficulties about that. For the present, I think that our best course of action is to give all the encouragement we can to Dr. Jarring.
  Mr. Jackson: Would my right hon. Friend give the House an assurance that Dr. Jarring's mission is still within the limits of possible success? Secondly, can he say that one of the vital elements in its success would be for Israel to abide by United Nations resolutions concerning Jerusalem within the general package of the British United Nations resolution of 22nd November?
  Mr. Stewart: As I said just now, the essential of a settlement is that all parties concerned shall respect all the parts of the resolution.
  Viscount Lambton: Will the Foreign Secretary take this opportunity of saying whether there has been any reconsideration of our defence treaties in the Middle East with the independent States in view of the Russian infiltration of that area?
  Mr. Stewart: That goes rather outside the limits of the Question. The noble Lord might like to put that Question down.
  Mr. Henig: Has my right hon. Friend seen the report from Moscow that President Nasser has now made a fresh speech and said that he will never have diplomatic relations with Israel? Will my right hon. Friend not agree with me that this would be a most deleterious step, and will he make his best diplomatic recommendations in order to impress upon the Egyptians that such an attitude is not conducive to any kind of peace settlement at all?
  Mr. Stewart: I have seen the report of this speech and I should like a little longer time in which to check it and to evaluate it before commenting upon it.
  Sir Alec Douglas-Home: Is it not a fact that, as we stand and sit here, the various parties to this dispute will not themselves get together to discuss this matter and that therefore a third party must be used, and that, for the time at any rate, it would be wise to give Mr. Jarring full authority to do what he can?
  Mr. Stewart: I am sure the right hon. Gentleman is right.

  INTERNATIONAL ORGANISATIONS (BRITISH DELEGATIONS)
  Mr. Juddasked the Secretary of State for Foreign Affairs on what basis the Government appoints British representatives and delegations to international organisations; how many professional civil servants, how many members of the public, how many peers and how many Members of Parliament have been so appointed during the past year; and whether he will publish in the OFFICIAL

  17
  REPORT full details of all those at present having such responsibilities.
  The Under-Secretary of State for Foreign Affairs (Mr. Maurice Foley): These appointments are generally decided, after any necessary consultation, by the Minister responsible for United Kingdom relations with the organisation concerned. The delegations consist of officials, experts from Government service or private organisations, and, in some cases, Members of Parliament. During the past year 246 professional civil servants, 34 members of the public, 8 peers and 54 Members of Parliament, including members of Her Majesty's Government, have been so appointed.
  I will, with permission, circulate in the OFFICIAL REPORT a list of our permanent representatives to international organisations in the economic and social field.
  Mr. Judd: While thanking my hon. Friend for that reply, may I ask him if he will agree that it is rather unsatisfactory that the House does not have more detailed information available about these faceless, however dedicated, men negotiating international policy on our behalf, and that it strengthens the argument for a Select Committee which can keep in touch with all these aspects of detailed policy?
  Mr. Foley: I am not aware of any view that says such a thing as faceless people. Information on representation at all international organisations is public knowledge and all Members of Parliament should be aware of it.
  Following is the list:
  United Kingdom Permanent Mission to the United Nations, New York

  The Rt. Hon. Lord Caradon, G.C.M.G., K.C.V.O., O.B.E.

  Sir Leslie Glass, K.C.M.G.

  Mr. M. E. Allen

  Mr. D. H. T. Hildyard

  Mr. J. I. McK. Rhodes

  Col. H. J. Sweeney, M.C.

  Mr. E. Youde, M.B.E.

  Mr. J. D B. Shaw, M.V.O.

  Mr. H. G. Darwin

  Mr. J. G. Taylor

  Mr. P. J. S. Moon

  Mr. B. L. Barder

  Mr. W. C. Squire

  Mr. T. N. Haining

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  Mr. R. A. C. Byatt

  Mr. S. L. Egerton

  Mr. R. N. Posnett

  Miss S. E. Harden, M.B.E.

  Mr. D. F. Milton

  Miss J. H. Mather

  United Kingdom Mission to the Owce of the United Nations and other international organisations in Geneva

  Sir Eugene Melville, K.C.M.G.

  Mr. C. L. S. Cope

  Mr. P. H. R. Marshall

  Mr. D. J. C. Jones

  Mr. A. A. Acland

  Mr. B. J. P. Fall

  Mr. G. C. Warner

  Mr. D. O'Connell

  Mr. B. Hampton

  Mr. J. R. H. Evans

  Mr. D. H. Easton

  United Kingdom Delegation to O.E.C.D., Paris

  Sir Edgar Cohen, K.C.M.G.

  Mr. J. C. A. Roper, M.C.

  Mr. O. L. Williams

  Mr. R. E. G. Burges-Watson

  Mr. P. E. Dougherty

  Mr. J. Brasnett

  United Kingdom Delegation to the Council of Europe, Strasbourg

  Mr. E. B. Boothby, C.M.G.

  Miss P. M. Hutchinson.

  Miss B. M. Deavin, M.B.E.

  United Kingdom Delegation to the European Communities, Brussels

  Sir James Marjoribanks, K.C.M.G.

  Mr. F. H. Jackson.

  Mr. G. W. Ford.

  Mr. J. Mellon.

  Mr. P. W. J. Newing, M.B.E.

  Mr. P. J. C. Evans.

  Mr. D. H. A. Hannay.

  Mr. A. E. Heath.

  Mr. R. O. Barrit.

  Mr. D. H. Hill.

  Mr. H. J. O. R. Tunnel.

  Mr. R. C. McIvor.

  International Labour Organisation United Kingdom governmental members of

  the I.L.O. Governing Body.

  Mr. A. S. Marre, C.B.

  Mr. A. M. Morgan, C.M.G.

  International Atomic Energy Agency and United Nations Industrial Development Organisation
  Mr. J. F. Wearing (resident in Vienna), Alternate Governor, I.A.E.A. and United Kingdom Representative, U.N.I.D.O.
  Mr. N. M. Hansford (resident in Vienna), Adviser to the Alternate Governor, I.A.E.A. and United Kingdom Deputy Representative U.N.I.D.O.
  International Bank for Reconstruction and Development, and International Monetary Fund
  Mr. E. W. Maude, Executive Director, I.M.F., and I.B.R.D.
  Mr. M. P. J. Lynch, Alternate Director, I.B.R.D.
  Mr. V. G. Huntrods, Alternate Director, I.M.F.
  Mr. I. Craik.
  The Western European Union
  United Kingdom Representative on the Permanent Council.
  The Viscount Hood, K.C.M.G.
  Food and Agriculture Organisation
  Mr. A. A. W. Landymore, United Kingdom Permanent Representative to the F.A.O., Resident in Rome.
  U.N.E.S.C.O.
  Mr. L. C. J. Martin, United Kingdom Permanent Delegate to U.N.E.S.C.O.
  Miss S. K. Guiton, United Kingdom Deputy Permanent Delegate to U.N.E.S.C.O. (resident in Paris).
  Dame Mary Smieton, D.B.E., United Kingdom Member of the U.N.E.S.C.O. Executive Board.
  World Health Organisation
  Sir George Godber, K.C.B. (Chief Medical Officer for England and Wales), United Kingdom Member of the W.H.O. Executive Board.
  World Meteorological Organisation
  Dr. B. J. Mason (Director General of the Meteorological Office), United Kingdom Congress Member and United Kingdom Member of the Executive Committee.
  International Civil Aviation Organisation

  Mr. R. S. F. Dickenson, C.M.G.

  Mr. R. J. Broughton.

  Miss M. White, M.B.E.

  SOUTH AFRICA (SUPPLY OF ARMS)
  Sir R. Russellasked the Secretary of State for Foreign Affairs, in view of the deterioration in the balance of trade with the Republic of South Africa month by month between 1st January and 31st May, 1968, if he will now reconsider the embargo on the export to that country of arms for external defence.
  Mr. M. Stewart: No, Sir.
  Sir R. Russell: Is the Foreign Secretary not aware that this is the first year in which we have had an adverse balance of trade with South Africa, and will he not agree that the arms embargo is a contributory cause of that? Would it not be a good thing to abandon this nonsense and put the trade balance right?
  Mr. Stewart: No, the arms embargo is not a contributory cause of it. The cause of the unfavourable balance is the substantial increase in our imports from South Africa. Exports from the United Kingdom to South Africa, it is true, for the first five months of this year were somewhat lower than they were in 1967, but this was true of exports of nearly all other countries to South Africa at that time. There was an exceptional spurt of imports into South Africa in 1967 following the relaxation of certain restrictions. Figures this year are well above those for 1966.
  Mr. John Lee: Is not the fact that our imports from South Africa are increasing one more argument in favour of import controls? Would my right hon. Friend have a word with the President of the Board of Trade, who seems to have an obsessive inhibition against import control?
  Mr. Stewart: That is a good deal wider than this Question.

  MALAYSIA
  Mr. Eldon Griffithsasked the Secretary of State for Foreign Affairs if he will hold consultations with the United States of America with a view to enlisting American support, political and financial as well as military, for the Five Power arrangements agreed at Kuala Lumpur for the future defence of Malaysia.
  Mr. Foley: It would not be appropriate for the United Kingdom, one of five participants in the Conference, to take such an initiative.
  Mr. Griffiths: In congratulating the hon. Gentleman on having his new post, may I ask him whether, in view of the importance of the talks which were recently taking place in Kuala Lumpur, he would agree that it is essential to associate the Americans with the defence arrangements which were made there? How else would they be credible, and in what way will they fit into S.E.A.T.O.?
  Mr. Foley: I thank the hon. Gentleman for his kind remark. I think that if he will examine again the communiqué after the Five-Power Conference, he will see that they are matters primarily of adjustment among the Commonwealth

  21
  countries concerned. Clearly this is a first step in discussing the new situation when we withdraw from the Far East. S.E.A.T.O. has been informed and is aware that this is a first step in these discussions.

  N.A.T.O.
  Mr. Eldon Griffithsasked the Secretary of State for Foreign Affairs if he will appoint a study group within his Department to draw up British proposals for revitalising the North Atlantic Treaty Organisation.
  Mr. Ridsdaleasked the Secretary of State for Foreign Affairs what proposals he is putting forward with a view to strengthening the North Atlantic Treaty Organisation.
  Mr. M. Stewart: Last year we took an active part in the studies on the Future Tasks of the Alliance, which resulted in a Report approved by the North Atlantic Treaty Organisation Ministers last December. Copies of this Report are in the Library of the House. A further comprehensive report by the Permanent Council on work accomplished so far in carrying out these tasks was examined and approved by Ministers at Reykjavik on 24th and 25th June. This work still continues. I therefore see no need for a special Study Group or a fresh initiative at this stage.
  Mr. Griffiths: While welcoming the achievements at Reykjavik, may I ask the right hon. Gentleman if he would not agree that the first essential in maintaining the validity of N.A.T.O. over the next decade is to maintain the United States on this side of the Atlantic? Would he also agree that if this is to be achieved it is essential for Europe, including Britain, to assist the Americans in other parts of the world?
  Mr. Stewart: No. I do not think I could assent offhand to such a large proposition as that, which seems to go a great deal further than these proposals of the Study Group.
  Mr. Ridsdale: As our efforts to enter the E.E.C. are so abortive, surely the Government should do all they can to build up a North Atlantic Authority? Is not one way not to weaken our defence forces for N.A.T.O., and is that not dis-
  22
  turbing to N.A.T.O.—that we are to reduce our forces still further?
  Mr. Stewart: I do not think the hon. Member has noticed that we have recently increased our commitment to N.A.T.O.
  Mr. Molloy: Would my right hon. Friend not agree that to work towards the establishment of a European peace and security council and the abolition of both the N.A.T.O. and Warsaw Pacts would be more in the interests of the ordinary people of Europe?
  Mr. Stewart: I think that may be at some time in the future, but I believe it is right to maintain the strength of N.A.T.O. at the present time, but N.A.T.O. is not only a defensive organisation. As was made clear in the Report of the Reykjavik Conference, it is concerned with securing détente between East and West.
  Mr. Dodds-Parker: Pending the politicians firmly making up their minds, and contrary to what the hon. Member for Ealing, North (Mr. Molloy) said, surely a good deal of effective work is being done by the officials and officers of N.A.T.O.?
  Mr. Stewart: I am not quite sure that I follow that question. This is something which happens all the time. It is partly, I think, what we owe to what is called the Harmel Report, and further progress at Reykjavik.

  UNITED STATES (BALTIMORE CONSULAR FACILITIES)
  Mr. Ellisasked the Secretary of State for Foreign Affairs what action he is taking to improve the consular facilities in Baltimore, United States of America.
  Mr. Mulley: The post was inspected in March, and, as a result, the vice-consul has been promoted and authorised to take on a full-time secretary.
  Mr. Ellis: While thanking my right hon. Friend for that reply, may I ask him whether he is aware that I have had a complaint from a constituent who has had to take business associates into this office which, I understand, is situated above a warehouse? May I thank my right hon. Friend for removing from the

  23
  consular office the sofa without stuffing in it?
  Mr. Mulley: I am obliged to my hon. Friend. I thought at first that he was trying to take the stuffing out of me.

  PERSIAN GULF
  Mr. Wallasked the Secretary of State for Foreign Affairs if he will make a statement on the proposed Federation in the Persian Gulf.
  Mr. Colin Jacksonasked the Secretary of State for Foreign Affairs if he will make a statement on progress towards a Federation in the Persian Gulf.
  Mr. Goronwy Roberts: Discussions are continuing between the Rulers of the States concerned on putting into effect the Agreement, signed at Dubai on 27th February, to set up the Union of Arab Emirates. Her Majesty's Government welcome all moves towards greater cooperation and unity between the States of the area.
  Mr. Wall: I wish the discussions well. Could the Minister say whether it is intended to have a Federal defence force to take over the British Treaty responsibilities? If so, would it not be wiser to leave British troops in the area until the defence force is available and in action?
  Mr. Roberts: The hon. Gentleman will not expect me to agree with the last part of his supplementary question. On the first part, one would expect and hope for, and, if asked, we will advise on, the formation of a unified force for the internal security and external defence of this area.
  Mr. Jackson: Bearing in mind the traditional differences in the area, does the Minister agree that good progress towards federation has been made to date?
  Mr. Roberts: I think it is fair to say that. My information is that while there have been inevitable disagreements among the nine Rulers about the future form of federation or union, nevertheless, a constant factor of agreement is that there shall be a closer association amounting to a federation.
  Viscount Lambton: Did not the Minister give an assurance to these very leaders last year that it was not our intention to withdraw from the Persian Gulf? Why is the Minister now not agreeing with what he said last year?
  Mr. Roberts: What I said to the Rulers of the Gulf in November last year was that we could not set a time limit to our military presence in the Gulf. In January I was able to give this time limit. It is a time scale which allows more than three years in which the Rulers will, if they wish it, have our advice and guidance to set up a successor system.
  Mr. J. T. Price: Is my right hon. Friend aware that, whatever the motives might be, most of the sheikhs in the Persian Gulf, including the Ruler of Muscat and Oman, are inclined in an extremely friendly direction towards this country? As we have not as many friends in the world as we would like, will the Minister do nothing to impair the friendship that already exists?
  Mr. Roberts: That is quite true. I think that is a fair and important comment on the previous supplementary question. The people and Rulers of this area hold us in high regard and are anxious, when our present treaties and agreements come to an end, to substitute for them treaties of friendship.

  SPAIN (GIBRALTAR)
  Mr. Wallasked the Secretary of State for Foreign Affairs if he will make a statement about the renewed Spanish blockade of Gibraltar and the representations he has made to the Spanish Government.
  Mr. Mulley: After the debate in this House on 7th May my right hon. Friend called in the Spanish Ambassador on 8th May, and told him what Her Majesty's Government and this House thought of the latest Spanish restrictions. My right hon. and noble Friend Lord Caradon has set out our position in detail in a letter to the Secretary-General of the United Nations on 21st June, of which a copy has been placed in the Library of the House.
  Mr. Wall: Does the right hon. Gentleman agree that experience in the last

  25
  three years has shown that the screw is being tightened and tightened on Gibraltar and that this will continue unless counter-measures are taken? Is the Minister also aware that the people of Gibraltar are beginning to feel that we are letting them down?
  Mr. Mulley: I cannot agree with the hon. Gentleman's last observation. As the hon. Gentleman knows, the Chief Minister and the Deputy Chief Minister of Gibraltar are here having talks today with my right hon. Friend the Commonwealth Secretary. As the Commonwealth Secretary told the House on a previous occasion, we do not rule out retaliation provided it meets two tests: first, that it should not do Gibraltar and Britain more harm than Spain; and, secondly, that it should offer the prospect of persuading Spain to change her policies.
  Mr. Ogden: Can the Minister say whether the Spanish authorities have been operating any frigates near the Rock recently?
  Mr. Mulley: I am sorry, but I cannot give a recent assessment without notice.
  Sir A. V. Harvey: Is the Minister aware that what he has said amounts to nothing at all? Could he tell the House what has happened since we had the debate six or seven weeks ago? Great things have been done for the economy of Gibraltar. Why do not the Government get down to it and take the same attitude as they do towards Rhodesia?
  Mr. Mulley: I do not think that the two matters are in any sense the same. As I have said, the Chief Minister of Gibraltar is having talks with my right hon. Friend the Commonwealth Secretary, and questions about the internal aspects of Gibraltar must be addressed to my right hon. Friend.

  GREECE
  Mr. St. John-Stevasasked the Secretary of State for Foreign Affairs if he will make a statement about the policy of Her Majesty's Government with regard to the régime in Greece.
  Mr. Molloyasked the Secretary of State for Foreign Affairs if he will now make a further statement on Her
  26
  Majesty's Government's policy in relation to civil rights and constitutional rule in Greece.
  Mr. Mulley: We shall continue to work for a return to constitutional rule and democratic liberties in Greece.
  Mr. St. John-Stevas: Will the Foreign Office use its influence with the Prime Minister to revert from the language of the gutter to the language of diplomacy and so facilitate the restoration of King and constitution in Greece?
  Mr. Mulley: I cannot accept that the two points of the hon. Gentleman's question are necessarily related. The House spent a considerable time on this matter last week, and I do not think that any useful purpose will be served by going into it again now.
  Mr. Molloy: First, will the Minister give the House an assurance that he will not behave in such a simpering and sycophantic way as advocated by the hon. Member for Chelmsford (Mr. St. John-Stevas)? Secondly, as this régime is neither civil nor constitutional and uses torture to break body and spirit, is it the intention of my right hon. Friend to raise this matter at the N.A.T.O. Council, as he indicated, in reply to a previous supplementary question, that he does?
  Mr. Mulley: I can give my hon. Friend the assurance that I will not conduct myself in a syohophantic way. I do not think I have ever before been charged with this particular crime.
  I do not think at this juncture that it would be useful to raise the matter at the N.A.T.O. Council.
  Sir F. Bennett: Can the Minister confirm that it is still the firm intention of Her Majesty's Government to maintain our present favourable balance of trade with Greece?
  Mr. Mulley: I thought that my right hon. Friend the President of the Board of Trade set out with admirable clarity our desire to separate political and trade issues, and to trade not only with Greece, but with any other country with whom we can do it on a neutral basis.
  Mr. Francis Noel-Baker: I think my right hon. Friend is aware that I was in Athens this morning. Is my right hon.

  27
  Friend aware that recent statements have caused widespread indignation and offence in Greece among critics of the Government and others and among British residents in that country? Although the present Government did not come to power by democratic methods—[Interruption]—is my hon. Friend aware that they are not insensitive to public opinion and that statements of this kind are hardly calculated to assist British exports and orders under negotiation at the present time?
  Mr. Mulley: I am glad to learn from my hon. Friend the importance of public opinion.
  To put the whole matter in perspective, in a way that is done better in debate than in answer to questions, the Government's position was admirably set out on 11th April by the then Undersecretary. I would counsel hon. Members on both sides to see that we set out our position clearly and that we do not approve of the régime and our reasons for it.
  Viscount Lambton: Will the Minister take this opportunity of saying whether the conversations on this matter between the King of Greece and the Prime Minister were private and whether the Prime Minister had the permission of the King of Greece to quote his interpretation of the talks?
  Mr. Mulley: Such discussions are always private—so private I was not there, so I cannot assist the hon. Gentleman.
  Mr. John Fraser: May I press my right hon. Friend on the question of raising this in N.A.T.O.? Is he aware that the N.A.T.O. Treaty contains a firm commitment to preserve individual liberty, democracy, and the rule of law? The philosophy of the N.A.T.O. Treaty is meaningless unless we raise this sort of thing within the Council.
  Mr. Mulley: I agree that this is a matter of great concern to many N.A.T.O. countries, and it has been discussed in N.A.T.O., but as the Council of Ministers, which would have been the most appropriate forum, has just risen, it is unlikely that it would be acceptable to call a new Council on this issue at this moment of time.

  CYPRUS (UNITED NATIONS FORCE)
  Mr. G. Campbellasked the Secretary of State for Foreign Affairs if he will make a statement on Her Majesty's Government's policy regarding the future of the United Nations force in Cyprus.
  Mr. Foley: The rôle of the United Nations Force in Cyprus continue to be very important. We recently supported the extension of the Mandate up to 15th December. We hope that progress towards a settlement will permit further reductions in its strength, and in the end a termination of its task.
  Mr. Campbell: As the Cyprus situation has, fortunately, been improving, and as the life of the United Nations force has hitherto been extended at short notice for short periods, are the Government considering carefully the need, when the time comes, for a well-organised and perhaps gradual withdrawal?
  Mr. Foley: Yes, Sir.

  VIETNAM
  Mr. R. C. Mitchellasked the Secretary of State for Foreign Affairs what information he has received, as co-Chairman of the Geneva Agreement, about civilian casualties in Saigon as a result of recent Vietcong military activity.
  Mr. M. Stewart: I do not receive information of this sort in my capacity as co-Chairman of the Geneva Conference. However, the Vietnamese Ministry of Defence has stated that civilian casualties in the Saigon area from 5th May to 30th June, from both ground attacks and the rocket and mortar attacks, were 612 killed and 4,812 wounded.
  Mr. Mitchell: I am sure that the House will be appalled at those figures. Will my right hon. Friend ask the Soviet co-Chairman to make representations to the North Vietnamese Government to try to stop the indiscriminate rocket attacks against civilians in Saigon?
  Mr. Stewart: When I was in Moscow I urged the desirability of the North Vietnamese Government being prepared not only to do this sort of thing, but to make some response to the move made by the United States.
  Mr. Hugh Jenkins: Is my right hon. Friend aware that reports from Quakers who are doing amputee work in Saigon are to the effect that 80 per cent. of the amputations are necessary as a result of American attacks, and only 20 per cent. as a result of Vietcong attacks?
  Mr. Stewart: I am afraid that it is often difficult to get exact reports, and even if I accept those figures that does not rub out the shocking cruelties practised in Saigon and indeed Son Tra recently.
  Mr. Eldon Griffiths: Does not the right hon. Gentleman agree that the crucial point is that the Vietcong attacks on the civil population of Saigon have been stepped up at a time when the American bombardment of North Vietnam has been very substantially reduced?
  Mr. Stewart: That appears to be so, and that means that it is not only a matter of cruelty to human beings, but that it is halting the possibility of progress towards peace.
  Mr. R. C. Mitchellasked the Secretary of State for Foreign Affairs whether he will, with the Union of Soviet Socialist Republics as co-Chairman of the Geneva Agreement, undertake joint action to call upon both belligerents in Vietnam to reduce the scale of their military activities, with a view to improving the atmosphere for successful peace talks.
  Mr. Tinnasked the Secretary of State for Foreign Affairs what initiative he now proposes should be taken by Great Britain and the Union of Soviet Socialist Republics, as co-Chairmen of the Geneva Agreements, following recent developments, in bringing about a peaceful settlement in Vietnam.
  Mr. M. Stewart: Among the prerequisites for action by the co-Chairmen are a clear understanding of how best we can help a settlement; an equal readiness on the part of us both to act jointly; and a reasonable expectation that the parties to whom action is directed will respond. This is not the situation at present, but I maintain close contact with the Soviet co-Chairman, who is well aware that we are ready to help negotiations in any way we can when this is the wish of the parties concerned.
  Mr. Tinn: Can my right hon. Friend say whether he has observed any pressure on the other co-Chairman, Russia, to dissociate herself from the North Vietnamese following the stepped-up attacks by the Vietcong on South Vietnam? Has there been any pressure on Russia to dissociate herself from these attacks, in the way that we are so often pressed to dissociate ourselves from America?
  Mr. Stewart: No, Sir, I have not. I am still waiting.
  Mr. Ogdenasked the Secretary of State for Foreign Affairs what action he proposes to ensure the continuing safety of British subjects in Saigon in the light of increased North Vietnamese attacks on the city.
  Mr. M. Stewart: Her Majesty's Ambassador and his staff keep in close and constant touch with the British community in Saigon on all matters affecting their security. Plans exist to meet as many contingencies as possible, though hon. Members will realise that there are limits to what can be done to give protection against random rockets and shells.
  Mr. Ogden: My right hon. Friend expressed the admiration of the House for the way in which the Ambassador and his staff conducted their duties. Can my right hon. Friend give an assurance that the physical condition of the Embassy itself as regards shelters, safety, and that kind of thing, is able to take care of those who might wish to take shelter there on occasion?
  Mr. M. Stewart: I echo why what my hon. Friend said in the first part of his question. It would, I believe, be possible to give shelter to some in the Embassy, but at present we have made plans to meet as many contingencies as possible.
  Mr. Ogdenasked the Secretary of State for Foreign Affairs what communication he has received in his capacity of co-chairman of the Geneva Agreement from the Secretary General of the United Nations about the acceptability to both sides of the United Nations rôle in ending the war in Vietnam.
  Mr. M. Stewart: None, Sir. As I reminded the House on 20th May, North Vietnam has consistently rejected any suggestion that the United Nations should concern themselves with Vietnam. The

  31
  United States on the other hand have kept the United Nations informed of their action in Vietnam.—[Vol. 765, c. 2–3.]
  Mr. Ogden: While regretting the nature of the reply which my right hon. Friend has had to give, may I ask him to give an assurance that our Ambassador at the United Nations will keep this matter constantly before the Assembly?
  Mr. Stewart: Certainly, Sir.
  Mr. Whitaker: Would any belligerents be willing to observe a total cease-fire while negotiations were pending on Vietnam?
  Mr. Stewart: As I understand it, the United States, having made the move they did at the end of March, if that could now be matched by a further step of de-escalation it might be possible to make further steps on both sides, leading possibly to what my hon. Friend has suggested.

  HOLY SEE (HER MAJESTY'S MISSION)
  Mr. G. Campbellasked the Secretary of State for Foreign Affairs whether he has considered translating Her Majesty's Mission to the Holy See from a legation to an embassy.
  Sir W. Teelingasked the Secretary of State for Foreign Affairs, in view of the number of Commonwealth countries now having ambassadors accredited to the Holy See, whether he will consider upgrading the Minister to the Holy See to be an ambassador so as to give him an equal rank with Her Majesty's other representatives.
  Mr. Mulley: This matter is being kept under review, but we are not convinced that this is the right time to seek any change in existing arrangements.
  Mr. Campbell: As legations are now rare in diplomacy, and since other Commonwealth countries have embassies to the Holy See, has not the time arrived for this change?
  Mr. Mulley: I do not think the time is yet ripe, and while the hon. Gentleman is right that some Commonwealth countries have embassies there, a number of other important Commonwealth countries
  32
  are not represented there at all. The legation serves the function of keeping us in touch with the Holy See on international matters, and we have the greatest regard for the contribution it has made.
  Sir W. Teeling: Is it true that the number of embassies is about 57, of which eight are from Commonwealth countries, and that other Commonwealth countries are waiting until we give the lead? The only Ministers there are from Monaco, San Marino, Ethiopia and Britain. Can that really mean that we are doing our best to be friendly with the Vatican and help it in what it is trying to do for peace in the world?
  Mr. Mulley: I must deny any idea that the hon. Gentleman has that we discriminate against the Vatican in this way. There are only 35 resident ambassadors, and 18 non-resident ambassadors. The fact that we have a resident Minister there enables us to keep in touch with them, and they with us. The existing arrangements could not be substantially improved by what is proposed, but we are willing to keep this under review because we clearly want to make a change at a time that is generally acceptable.
  Mr. Clark Hutchison: Will the right hon. Gentleman bear in mind that there are far too many ambassadors today, and will he put in hand a review to reduce many embassies to legation status in order to save money and staff?
  Mr. Mulley: That is an interesting way of looking at the matter, to have more legations and fewer embassies, but it would be wrong to start a change of policy of this kind to meet this particular difficult situation.
  Sir Knox Cunningham: Is there any constitutional limitation imposed on the proposed action by the Act of Settlement or the Bill of Rights?
  Mr. Mulley: The hon. and learned Gentleman was told in answer to a previous question that there was no such legal bar.
  Mr. St. John-Stevas: Going back to the Minister's original reply to my hon. Friend, does he realise that it is exactly the same reply that was given by the Foreign Secretary when he was last at the Foreign Office some years ago? Will he ask the Foreign Secretary why he has

  33
  not used the intervening period of contemplation to advance his thought on the matter?
  Mr. Mulley: One of the endearing characteristics of my right hon. Friend is that he is very consistent in his views. I am sure that he has thought much about this problem, but the hon. Member will know that other matters have exercised the minds of members of the Government in the last 18 months.
  Sir W. Teeling: On a point of order. In view of the unsatisfactory nature of that reply, I shall seek leave to raise it on the Adjournment.

  TRUCIAL STATES
  Mr. Goodhartasked the Secretary of State for Foreign Affairs when he hopes to complete the renegotiation of United Kingdom defence agreements with the Trucial States in the Persian Gulf.
  Mr. Goronwy Roberts: We have offered to replace our treaties of protection by treaties of friendship. It will be some time before discussion can be completed because the States are considering the form of their future association among themselves.
  Mr. Goodhart: What will be the meaning of this treaty of friendship? Do we intend to maintain a special relationship with the Trucial States after we have implemented our unilateral decision to withdraw our forces from the Persian Gulf?
  Mr. Roberts: I would hope and expect that our relationship with this area and with individual States will, far from diminishing, increase. There is already evidence that the States concerned would warmly welcome treaties of friendship leading in future to an amplification of our social, commercial and cultural relations with them.

  NORTH ATLANTIC TREATY ORGANISATION (MINISTERIAL MEETING)
  Mr. Allaunasked the Secretary of State for Foreign Affairs if he will make a statement on the North Atlantic Treaty
  34
  Organisation talks at Reykjavik on mutual East-West reduction of military forces in Europe.
  Mr. Peelasked the Secretary of State for Foreign Affairs if he will set out the provisions of the declaration recently adopted by Foreign Ministers of countries participating in the North Atlantic Treaty Organisation defence programme with regard to the basis of comparison between the forces of the North Atlantic Treaty Organisation countries and the Warsaw Pact Powers and the analyses of alternative ways of achieving a balance and reduction of forces; whether the Committee of Political Advisers has agreed on these; and if he will make a statement.
  Mr. M. Stewart: At Reykjavik the countries participating in the North Atlantic Treaty Organisation defence programme issued a declaration on mutual and balanced force reductions. I have arranged for this to be circulated in the OFFICIAL REPORT.
  Mr. Allaun: Why, after seven months' discussion, has no proposal been forthcoming? Why does not Britain take the initiative, and how can we know whether Russia is receptive if we do not offer any proposals?
  Mr. Stewart: If my hon. Friend will study the terms of this declaration he will see that it is one that involves a response. We could then proceed to more details.
  Mr. Peel: Is the right hon. Gentleman aware that there is a good deal of disagreement in many quarters as to the relative strength of the conventional forces of the two sides? Some statements say that they are almost equal, some maintain that the West is a good deal less strong than the East. Is he aware that this causes a good deal of confusion among Members of Parliament on various delegations when discussing this matter? Could we be given some information as to whether agreement is being reached on a proper comparison of forces?
  Mr. Stewart: I will certainly consider whether more information could be made available.
  Following is the declaration:
  ANNEX TO THE COMMUNIQUÉ ISSUED AT THE END OF THE MINISTERIAL MEETING OF THE NORTH ATLANTIC COUNCIL ON 25TH JUNE, 1968.
  DECLARATION ADOPTED BY FOREIGN MINISTERS AND REPRESENTATIVES OF COUNTRIES PARTICIPATING IN THE N.A.T.O. DEFENCE PROGRAMME.
  1. Meeting at Reykjavik on 24th and 25th June, 1968, the Ministers recalled the frequently expressed and strong desire of their countries to make progress in the field of disarmament and arms control.
  2. Ministers recognised that the unresolved issues which still divide the European continent must be settled by peaceful means, and are convinced that the ultimate goal of a lasting, peaceful order in Europe requires an atmosphere of trust and confidence, and can only be reached by a step-by-step process. Mindful of the obvious and considerable interest of all European States in this goal, Ministers expressed their belief that measures in this field including balanced and mutual force reductions can contribute significantly to the lessening of tension and to further reducing the danger of war.
  3. Ministers noted the important work undertaken within the North Atlantic Council by member Governments in examining possible proposals for such reductions pursuant to paragraph 13 of the "Report on the Future Tasks of the Alliance", approved by the Ministers in December, 1967. In particular, they have taken note of the work being done in the Committee of Political Advisers to establish bases of comparison and to analyse alternative ways of achieving a balanced reduction of forces, particularly in the central part of Europe.
  4. Ministers affirmed the need for the Alliance to maintain an effective military capability, and to assure a balance of forces between N.A.T.O. and the Warsaw Pact. Since the security of the N.A.T.O. countries and the prospects for mutual force reductions would be weakened by N.A.T.O. reductions alone, Ministers affirmed the proposition that the overall military capability of N.A.T.O. should not be reduced except as part of a pattern of mutual force reductions balanced in scope and timing.
  5. Accordingly, Ministers directed Permanent Representatives to continue and intensify their work in accordance with the following agreed principles:

  (a) mutual force reductions should be reciprocal and balanced in scope and timing;

  (b) mutual reductions should represent a substantial and significant step, which will serve to maintain the present degree of security at reduced cost, but should not be such as to risk destabilizing the situation in Europe;

  (c) mutual reductions should be consonant with the aim of creating confidence
  36
  in Europe generally and in the case of each party concerned;

  (d) to this end, any new arrangement regarding forces should be consistent with the vital security interests of all parties and capable of being carried out effectively.

  6. Ministers affirmed the readiness of their Governments to explore with other interested States specific and practical steps in the arms control field.
  7. In particular, Ministers agreed that it was desirable that a process leading to mutual force reductions should be initiated. To that end they decided to make all necessary preparations for discussions on this subject with the Soviet Union and other countries of Eastern Europe, and they call on them to join in this search for progress towards peace.
  8. Ministers directed their Permanent Representatives to follow up on this Declaration.

N.A.T.O. (NON-PROLIFERATION TREATY)
The following Question stood upon the Order Paper:
Mr. MURRAY: TO ask the Secretary of State for Foreign Affairs to what extent the United Kingdom's decision to sign the Non-Proliferation Treaty took account of commitments to the North Atlantic Treaty Organisation; and if he will make a statement.
The Minister of State for Foreign Affairs (Mr. Frederick Mulley): With your permission, Mr. Speaker, and that of the House, I would like now to reply to Question No. 60.
Her Majesty's Government are aware that the confidence of members of the North Atlantic Alliance in the collective security arrangements of the alliance is an essential factor in considering their accession to the Non-Proliferation Treaty.
I therefore welcome the oportunity to reaffirm Her Majesty's Government's continuing and wholehearted commitment to the collective security arrangements of the North Atlantic Treaty Organisation.
I also wish to make clear our interpretations of the basic Articles I and II of the Non-Proliferation Treaty.
These Articles would not prohibit North Atlantic Treaty Organisation nuclear consultation and planning or the permanent committee established for this purpose.
They would not disturb existing bilateral arrangements for deployment of

37
nuclear weapons within allied territory, as these arrangements do not involve any transfer of warheads or control over them up to the point where a decision to go to war is made. The Non-Proliferation Treaty would not be relevant to such a decision and would not be operative once it were made.
These Articles do not deal with the transfer of nuclear delivery vehicles, provided that there was no transfer of nuclear weapons or control over them.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: May I remind the House that we have a mass of business before we get to Orders of the Day? Brief questions will help.
Mr. Murray: While thanking my right hon. Friend for making the position of N.A.T.O clear, can he say what effect, if any, this Treaty will have on the development of political union in Europe?
Mr. Mulley: I am much obliged to my hon. Friend. A federated State would not be barred from succeeding to the former nuclear status of one of its components. A federated State would have to control all of its external security functions, including defence and all foreign policy matters relating to external security.
Mr. Dodds-Parker: Can the Minister say which of the N.A.T.O. Powers have not accepted the Treaty?
Mr. Mulley: A number of countries belonging to N.A.T.O. have not yet signed, but the only N.A.T.O. country which has indicated that it is unlikely to sign is France.
Mr. Heffer: Would my right hon. Friend not agree that it is a matter of regret that the Government should be so definite at this time in their support for the continuation of N.A.T.O.? Is it not clear that the time for looking again at N.A.T.O. and the Warsaw Pact has come? Would he not reconsider the Government's point of view in relation to this matter?
Mr. Mulley: My statement today is concerned with the interpretation of the Treaty which has been agreed within N.A.T.O. On the broader question, my hon. Friend will know that mutual force
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reductions are under study within N.A.T.O. and that we hope to make further progress in this regional European disarmament area, as well as in the broader categories.
Mr. Eldon Griffiths: Since this Question has obviously been put down to allow the Foreign Office to make the situation clear on this very important Treaty, would it not have been much wiser to make a statement to the House and allow a debate to take place, so that hon. Members could appreciate the enormous importance of this, and the great complexity of the Treaty, which has not yet been debated?
Mr. Mulley: Matters of debate are not for me. I would welcome the prospect of debate. I think that my right hon. Friend the Lord Privy Seal has said that he is hoping to arrange a foreign affairs debate before the end of the Recess, when I hope that this will be one of the matters to which attention will be turned.
Mr. J. T. Price: While we all strongly support the action taken by the Government in signing the Non-Proliferation Treaty, and all efforts to bring about general disarmament, will my right hon. Friend make it clear to the House that unilateral disarmament is not the policy of this Government, this party or this House?
Mr. Mulley: I am very happy to make it clear that we do not stand for unilateral disarmament. We could not make progress towards real disarmament if we tried to follow a thesis of that kind.
Perhaps I could correct a previous remark, when I said that there would be a debate before the end of the Recess. I meant before the beginning.
Mr. Marten: What effect can this statement have upon the re-equipment of the British Army of the Rhine with tactical nuclear weapons?
Mr. Mulley: This has no direct bearing because, as the hon. Gentleman will appreciate, when he studies my reply, this means, in effect, that the N.A.T.O. policy, as at present pursued, is not affected by Articles I and II of the Treaty.

NIGERIA
Mr. Braine Mr. Braine (by Private Notice) asked the Secretary of State for Commonwealth Affairs what progress he has made in persuading the Federal Government of Nigeria to permit an emergency air lift of food into the famine stricken areas, and whether he will make a statement.
The Secretary of State for Commonwealth Affairs (Mr. George Thomson): Discussions are at present going on in Nigeria between the Federal authorities and the International Red Cross. Lord Hunt is in touch with both. It is already clear from these discussions that all relief operations can best be channelled through the International Red Cross.
These discussions are, as I am sure the House will appreciate, extremely delicate, and I do not want to say anything today which can be an obstacle to their success. Lord Hunt arrived in Lagos on Saturday morning and has already made certain preliminary recommendations, which will enable us to save valuable time.
I can assure the House that this whole subject is being dealt with as a matter of the utmost urgency.
Mr. Braine: While we are grateful to the right hon. Gentleman for that statement, does he agree with two assertions: first, that there is starvation now in Biafra, people are dying there, and that the situation cannot really wait for the Hunt Commission to report, or for a land corridor to be established; and, secondly, that food is already stockpiled in Fernando Po and in Federal Nigeria? If so, can he tell the House, while we appreciate his difficulties, what are the obstacles to sending immediate relief?
If it be that Colonel Ojukwu will not accept food from Federal Nigeria, because he thinks it is poisoned, and Federal authorities will not allow direct flights into Biafra because they think that arms may be smuggled in, may I ask the right hon. Gentleman whether any thought has been given to both sides providing observers, travelling under safe conduct with every mercy mission, to ensure that only food is carried, that it is not poisoned and is being distributed properly?
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Is the right hon. Gentleman aware that if there is a shortage of suitable aircraft he will have the fullest support from both sides of the House, and from the whole nation, in offering the Federal Government the use of R.A.F. aircraft for an emergency airlift?
Mr. Thomson: I accept both the hon. Gentleman's preliminary assertions, with this qualification about his statement that there is starvation in Biafra: there is starvation on both sides of what is at present a line where very little fighting is, fortunately, taking place. I have just had a direct report this morning to say that most of the relief organisations are agreed that the situation around Ikot Ekpene, which is on the Federal side of the line, is now desperate and as bad, if not worse than, anything in rebel-occupied territory. It is important for the House to be aware that human need is not simply in the Ibo-held territories, but also on the other side of the fighting line.
The question of observers facilitating the relief operation is among many things being actively studied and one of the reasons why I do not feel in a position to give the House too much information today.
To answer the hon. Gentleman's question about the possible use of the R.A.F., I assure the House that I have been continuously in touch with my right hon. Friend the Secretary of State for Defence. I have already said that, in principle, the R.A.F. could take part and could engage in various forms of operation, so long as they took place with the agreement of the Federal Government, on the one side—with their agreement to enter their air space, a right which every sovereign State has and which should not be taken lightly—and equally so long as there were absolute guarantees from the Biafrans that they would not be fired upon.
Mr. Henig: Is my right hon. Friend aware that as a result of many stories which have appeared in the Press and elsewhere over the weekend there is widespread concern that the Government are being much too dilatory in dealing with this serious position? Is he aware of the widespread feeling of revulsion at the fact that while this desperate situation

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is going on, with Colonel Gowon threatening to shoot down planes carrying food to the starving people, Her Majesty's Government are continuing to supply arms to this area?
Mr. ThomsonTo answer the last part of my hon. Friend's question, I cannot think of anything that Her Majesty's Government could do which would be more disastrous, in terms of the anxieties of both sides of the House to see progress mace on relief, than to choose this moment unilaterally to cease the supply of arms. I could not accept that Her Majesty's Government are being in any way dilatory. We have been working on this throughout the weekend, and if there has not been as much progress as all of us would like to see I cannot accept for a moment that this is in any way the fault of Her Majesty's Government.
Mr. Winnick: Is my right hon. Friend aware that an ever-increasing number of British people are now horrified at the numbers of people who are dying daily in Biafra from starvation? Is he also aware of the large number of British people outside the House, and hon. Members on both sides, who cannot understand the slowness with which Her Majesty's Government are considering an emergency airlift to Biafra? In view of the great anxiety that exists about the continuous loss of life in Biafra, would my right hon. Friend agree to make a further statement, either tomorrow or Wednesday, about an emergency airlift?
Mr. Thomson: I hope that my hon. Friend will accept that nobody on these benches is more anxious than I am to try to see relief given to those who are suffering. I remind my hon. Friend that this suffering is taking place not only in Biafra, but equally in those areas which are now held by the Federal Government. We have been doing everything that can possibly be done to bring about practical progress towards relief.
I think that the right thing at this stage is for us to allow Lord Hunt, in whom we all have the greatest trust, to go ahead with the delicate discussions with the Federal Government.
Mr. Tilney: Cannot pressure be brought to bear on Colonel Ojukwu and the Ibo leaders to allow food in by land
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and have a Commonwealth force there to see that it is properly administered?
Mr. Thomson: I remain firmly of the opinion that the scale of the suffering requires a long-term land lift and that the suffering cannot be adequately met in any other way. However, this does not diminish the need for an emergency interim airlift. We are doing all we can, both directly and indirectly, to persuade Colonel Ojukwu to reconsider the unfortunate position which he has taken in this matter. In particular, we are asking him to reconsider his refusal to allow members of Lord Hunt's mission to go into Ibo held territory to see for themselves what the position there is and to report to us so that we can give the maximum help.
Mr. C. Pannell: Is my right hon. Friend aware that those of us who have any links with Nigeria do not blame Her Majesty's Government at all for procrastinating? Would he agree that there should be a realisation in the House that this is a civil war and that it would create no advantage to anybody if we attempted to come down on one side or the other or evaluate something over which we have no understanding? Would he agree that the only thing that really matters is to proceed in the shortest possible time to stop the killing and dying?
Mr. Thomson: I am much obliged to my right hon. Friend and I commend his initial wise words to the House. At present, there is virtually a cease-fire operating on the borders of the Ibo territories. The loss of life is taking place mainly through starvation, and not through military activity. This means that the utmost priority must be given to getting the relief operations working. The prime responsibility in this respect rests at present with Colonel Ojukwu.
Sir Alec Douglas-Home: I am grateful for the right hon. Gentleman's assurance that he would consider using Transport Command if that should prove necessary to help with an emergency airlift. Is it not true that the best chance now of geting both sides to agree is to allow Lord Hunt to make a report in the next few days, and for the right hon. Gentleman to make another report to the House shortly?
Mr. Thomson: Yes, Sir. I am much obliged to the right hon. Gentleman for those comments.
Mr. Raphael Tuck: If we are trying to stop the fighting in Nigeria, why would it be disastrous—the word used by my right hon. Friend—to stop sending arms to the Nigerian Government?
Mr. Thomson: If the reason is not clear to my hon. Friend, then I think that it would be difficult for me to go into a longer explanation here. I would have thought that when Lord Hunt is engaged in delicate negotiations in Lagos this was absolutely the wrong time to raise that particular question.
Mr. Hugh Fraser: Would the right hon. Gentleman consider making the International Red Cross the chosen instrument for these negotiations and allowing it to have the use of aircraft, and so on? In view of the difficulties facing our High Commission, on both sides, would not the Red Cross be the best instrument to use in this situation?
Would the right hon. Gentleman also consider making an approach, on humanitarian grounds, to the Emperor of Ethiopia and President Tubman, who have great influence with the Organisation of African Unity?
Mr. Thomson: The Organisation of African Unity has for some time been seized of the problem of making its own contribution to peace in Nigeria, and I do not think that I should comment further on that matter at this point.
My right hon. Friend the Prime Minister emphasised—in his answer given over the weekend to Oxfam's anxieties—our belief that the International Red Cross is the best instrument for co-ordinating this operation. Indeed, we have been supported in this view by a message from Lord Hunt this morning, in which he says how important it is for the success of his mission; and that private individuals and organisations in this country who wish to do so, should make offers of help through the International Red Cross.
The International Red Cross has been accepted by the Federal Government as the most effective co-ordinating organisation and I am sure that, if this were done,
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it would greatly help to create the sort of atmosphere which would allow the relief work to go forward.

RAILWAYS DISPUTE (SETTLEMENT)
Mr. Edward M. Taylor Mr. Edward M. Taylor (by Private Notice) asked the Minister of Transport whether he will make a statement on the settlement of the railways dispute.
3.46 p.m.
The Minister of Transport (Mr. Richard Marsh): As the House will by now be aware, agreement was reached between the British Railways Board and the N.U.R. last Friday evening as a result of which the Union agreed to instruct its workers to resume normal working at once. The terms of the agreement are already well known to the House. Later that evening a similar agreement was reached with a negotiating Committee of the A.S.L.E.F., and this was ratified by the Executive Committee of the A.S.L.E.F. on Saturday.
I welcome this settlement, which brings to an end a fortnight in which the travelling public, and particularly commuters in the South-East, were put to a great deal of inconvenience and in some cases hardship.
The Government have throughout been concerned that any settlement should conform to three principles:

(1) The Board and the unions must reach agreement between themselves without Government intervention.

(2) There would be no financial help from the Government to finance any settlement. Indeed, there could be no such help because, under the terms of the Transport Bill, the Board will be "on its own" from the beginning of 1969.

(3) Any settlement must be in accordance with the productivity prices and incomes policy.

The settlement reached accords with these principles.
I should like to emphasise three points on this settlement.

(1) The agreement includes a specific instruction from the B.R.B. and the N.U.R. to their negotiators to secure implementation of the pay and

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efficiency agreements by 2nd September.

(2) The agreement also provides that, both immediately and after the con- elusion of the pay and emciency agreements, bonus and mileage payments will be contained at existing levels for existing performance.

(3) The Board tells me that the immediate extra cost of the settlement as compared with its offer of 22nd June is estimated to be about £170,000 in this year. In effect, what has been done is to redistribute the money which was already on offer to the unions. But nothing in the Penzance agreements conflicts with the self-financing basis of the main productivity deal, of which they will form part.

I am particularly pleased that the Board and the unions were able to reach agreement themselves without Government intervention, and I hope and believe that this settlement creates conditions in which we can all look to a brighter future for industrial relations on the railways.
Mr. Taylor: What estimate has been made of the cost of the dispute? Which of the four criteria on incomes policy justifies this award? Does the Minister agree that the concession of an interim award to all railwaymen after 14 days of rail chaos, when it was refused to them beforehand as a matter of principle, will serve only to encourage other unions to think that the only way in which they will get a wage increase is to go in for go-slows, industrial disputes, or strikes?
Mr. Marsh: With the greatest respect, the hon. Gentleman should draft his supplementary question after he has heard the Answer. It is not true to say that this is a new move. What has happened here is that the original offer has been redistributed. Some of the money which would have gone to the lower-paid workers has gone to the higher-paid workers. There is no difference in principle at all. The total cost is about £170,000.
Mr. Peter Walker: Is the Minister aware that the flat 3 per cent. increase has been given without any specific productivity agreements, which have still to be settled? Is he aware that on 24th June, Sir Henry Johnson, Chairman of the Railways Board, when asked whether he would give a general increase on
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account of later productivity agreements, said:
"No, no! I am sorry but we have been up that avenue before. There will be no further pay rises until the unions"—
Mr. Speaker: Order. There can be no quotations in supplementary questions.
Mr. Walker: Sir Henry said that there would be no further increases until productivity agreements had been made. Will the Minister say whether or not, if the productivity agreements are not made by 2nd September, the flat increase will remain?
Mr. Marsh: Perhaps I can repeat this point again. The Railways Staff National Tribunal made an award which allowed for an interim payment on account of a productivity agreement being subsequently made. What has happened is that virtually the same amount of money is now available as a result of the negotiations as was available before. It is not true to say that this is a new principle.
As to the productivity agreement, very large sums of money indeed—up 1o 24s. a week—are available to a large number of these men, which cannot be paid out until such time as a productivity agreement is signed. All the evidence at present points to the unions being very anxious to conclude a productivity agreement.
Mr. Murray: The fact that an agreement was reached over the weekend will give every commuter some satisfaction today, but will my right hon. Friend say whether he and his right hon. Friend the Secretary of State for Employment and Productivity will be keeping a very close watch on this situation so that we do not have a recurrence after 2nd September?
Mr. Marsh: I can only say that what will happen after 2nd September will be very big improvements in British Railways because of major changes in practices. The Government made it clear throughout the dispute that they would back the Railways Board in standing firm on the basis that it could not pay out money which it did not have.
Mr. George Brown: Will my right hon. Friend say whether what we thought we heard down here below the Gangway he

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actually said, which was that the justification is that the money in total is about the same and a settlement has been arrived at by taking what the lower-paid men would have got and giving it to the higher-paid men? If he really says that, how does he expect us to go on defending the incomes policy?
Mr. Marsh: I am sure that my right hon. Friend will be the first to support the incomes policy, which he invented. The agreement provides for very large increases, of up to 10½ per cent.—24s. a week—for the lower-paid workers, and the interim agreement will be absorbed into the subsequent agreement. What has happened is the redistribution of the interim award which will subsequently be subsumed by the main agreement, and the main agreement provides for very big distinctions between lower-paid and higher-paid workers.
Mr. George Brown: That is no answer.
Sir G. Nabarro: Because the very large increases to which the right hon. Gentleman refers depend absolutely on the acceptance of these productivity agreements, and they can only be successful if the swollen railway staffs are much reduced, will he not be absolutely candid with the House and say that he expects that under these productivity agreements there will be a substantial reduction in the number of railwaymen?
Mr. Marsh: All Ministers are always candid with the House, and it would not be for me to breach the tradition. The productivity agreements range over a wide number of different fields. In most cases they are directed towards encouraging the more efficient use of labour. The most significant thing that the Board has already got out of this settlement is the acceptance of bonus and mileage payments being related to basic rates.
Mr. J. T. Price: Is the Minister aware that the greatest personal contribution he can make to industrial peace on the railways in future is to keep quiet, and let the trade unions and the employers get on with the job?
Mr. Marsh: The last time I made a statement in the House I did not invite the Question that was put down. I expressed the Government's view that they
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intended to leave the negotiations for the Railways Board, and subsequently there were criticisms from various quarters to the effect that the Government should have been doing something about it. My hon. Friend is totally right. This is a matter to be negotiated between the Railways Board and the unions, and this is what happened.
Mr. Goodhart: As the Minister of Transport acknowledged that commuters in the Southern Region have had to put up with a 50 per cent. reduction in service for a fortnight, will he now recommend that the Board should extend the life of existing season tickets for a few days so as to give some compensation to those travellers who suffered?
Mr. Marsh: It is not for me to enter on this matter, except to say that, while commuters were caused an incredible amount of inconvenience, what emerged from this dispute was that they all eventually got to work.
Mr. Philip Noel-Baker: Will the Minister do his best to ensure that the Railways Board will have sufficient manpower to carry its present traffics, and greatly to increase them in the early future?
Mr. Marsh: I certainly hope that the House will give every possible support to British Railways to ensure that it is able to expand its capacity. One can only say that the present dispute has done a great deal of damage to the railway industry and to the future of railwaymen, as well as to commuters.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: Order. The Chancellor of the Exchequer.

STERLING (B.I.S. DISCUSSIONS)
The Chancellor of the Exchequer (Mr. Roy Jenkins): With permission, Mr. Speaker, I would like to make a statement.
The House will be aware that discussions have been taking place this weekend at the Bank for International Settlements, in Basle, amongst the representatives of the central banks of certain countries about a new facility for sterling.
The proposals which were considered were to provide new means for offsetting

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fluctuations in the sterling balances of sterling area countries. I should make it clear that the facility under discussion is not one which would provide finance to meet any deficit in the balance of payments of the United Kingdom. It is not a loan. It is not an arrangement which could or will lead to any increase in our total of overseas indebtedness. The object would be to strengthen the position of sterling and thus of the international monetary system as a whole.
I am glad to be able to tell the House that considerable progress has been made in these discussions. As a result, the Bank for International Settlements and 12 central banks, speaking where appropriate with the authority of their Governments, have given firm assurances of willingness to participate in the arrangements which are to be completed as soon as satisfactory consultations have taken place with sterling area countries.
These proposals are of great importance to all sterling area countries, and it is, therefore, right that consultations should take place with them all. These will be pursued urgently, but until they have been completed it would be wrong for me to make any further public statement.
I should like to express my warm appreciation of the constructive attitude of the countries with which these discussions in Basle have been conducted. I believe that the arrangements now contemplated, and the firm assurances we have had from these countries, offer the prospect of greater stability in the functioning of the international monetary system. While they in no way lessen the need to bring our own policies for restoring the balance of payments of the United Kingdom to a successful conclusion, they make it possible to pursue these policies without being adversely affected by fluctuations in the sterling balances. They are a major step forward in dealing with this longstanding problem.
Mr. Iain Macleod: As there are many negotiations still ahead, I would not wish to press the right hon. Gentleman today in detail on this matter? Is he aware that the announcement by the Bank and his own statement are disappointingly vague? May I ask three short questions, to see if he can give further information to the House?
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The right hon. Gentleman referred to a new facility for sterling and told us three times what it is not. Can he tell us what it is? Is it best described as a medium-term standby? Is it about £800 million to £1,000 million? What sort of time-scale has he in mind? Are the talks geared to the I.M.F. meetings and later meetings of the Commonwealth Finance and Prime Ministers?
Mr. Jenkins: I am grateful to the right hon. Gentleman for saying that he will not press me unduly, because these negotiations and talks have to be carried out. He asked what was the nature of the arrangement. He himself gave the term, a medium-term standby. I would not wish to quarrel with that. Nor would I wish to quarrel with the sum he mentioned, which has been mentioned elsewhere, as approximately that envisaged. So far as the time-scale is concerned, my intention is that consultations should start in a matter of days. I hope that they will be completed within a few weeks afterwards. I shall report back to the House as soon as I have anything to report.
Mr. Barnett: Is my right hon. Friend aware that many hon. Members, other than those who wish to make party political gain out of this, wish to congratulate him on his attempts to achieve stability in balance of payments? Will he assure the House that, regardless of the June trade figures, and in view of the already high level of unemployment, he will give no promise of any further deflationary measures?
Mr. Jenkins: No question of that has arisen.
Sir H. d'Avigdor-Goldsmid: Is the Chancellor aware that, despite the comment of his hon. Friend the Member for Heywood and Royton (Mr. Barnett) we all, on both sides of the House, wish him well in these difficult negotiations? Having said that, is the right hon. Gentleman aware that the successful outcome of these negotiations will only have the effect that the sterling balances will pass from creditors over whom we have some measure of control, into the hands of creditors over whom we shall have no control whatsoever? Therefore, this is a logical consequence of the policies that have been pursued by the right hon.

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Gentleman and his predecessor over the last four years.
Mr. Jenkins: Despite the encouraging and placatory introduction, I do not fully agree with the hon. Baronet. In the first place, he should wait and see exactly what the scheme is. In the second place, what we are here dealing with is a problem with which this country has been confronted for two decades or more. These are debts which were accumulated mostly over 20 years ago. They have been a source of instability in the international capital system and a source of difficulty to countries generally. If we can solve them on a sensible basis it will be a great advance for the world as a whole.
Mr. Dickens: Will my right hon. Friend undertake to present to the House a White Paper in due course setting out the full terms and conditions of this agreement particularly as it will affect the level of unemployment, the rate of economic growth and the amount of public expenditure in the years ahead? Secondly, is he aware that the T.U.C. and the large number of his hon. Friends would much have preferred it if the Government had chosen instead to mobilise our immense assets in North America and use them for buying out the volatile sterling balances rather than incur further obligations to foreign bankers?
Mr. Jenkins: I shall consider how best to inform the House, whether by means of a White Paper or a statement or otherwise of what has emerged from the consultations. I assure my hon. Friend that there will be nothing touching any of the points he mentioned.
On the second point, I have discussed in the House the proposition about liquidating part of our overseas portfolio which he has put to me in the past and I have indicated that I think there would be disadvantages and disruption associated with this method. I think that we have achieved the benefits without the disruption.
Mr. Thorpe: Is the Chancellor aware that any guarantee arrangements which improve the position of sterling and thus our trading position will be warmly welcome, but is he also aware that the House as a whole will look with great
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interest to see what, if any, strings are attached, particularly with regard to the movement of capital between individual members of the sterling area or of converting it into other currencies?
Is the Chancellor not convinced that the support for sterling that is needed from foreign bankers is proof positive of the impossibility of this country forever maintaining sterling as a reserve currency? We must use the breathing-space in setting up a new international reserve currency.
Mr. Jenkins: I am grateful that at least one Leader of an Opposition party very much welcomes anything which strengthens sterling. I think, however, that the right hon. Gentleman is being a little over-sensitive and worried about strings. This does not arise.
As far as the right hon. Gentlemen's second and broader question is concerned, I have expressed my views. We have to be very careful about disrupting the position of the reserve currencies and about responsibility to sterling area countries and we have to have regard to the changed nature of sterling in the modern world.
Mr. Sheldon: While congratulating my right hon. Friend on the nature of the negotiations and the way in which they are being carried out, may I ask how the proposals at present being discussed are likely to affect the whole of the sterling balances and what thought he has given to the problem of distinguishing between capital outflow for investment and fluctuation of sterling balances themselves?
Mr. Jenkins: I think that my hon. Friend, and indeed the House, will not think me unforthcoming if I say that I think it right to discuss these problems with the holders of sterling balances before discussing them with anyone else.
Mr. Maudling: As there have been references both to balance of payments and trading arrangements of this country, will the right hon. Gentleman make clear that these arrangements cannot have any net influence on current account or the basic balances?
Mr. Jenkins: Yes, I thought that I made that clear in my statement. They in no way obviate the need to get the

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balance of payments surplus at the earliest possible time we can. They cannot fail to be helpful both for us and for sterling area countries.
Mr. Cronin: While congratulating my right hon. Friend on the admirable progress he has made in these negotiations, may I ask whether, if these negotiations proceed successfully, he will give more consideration—without committing himself now—to turning his back gradually on the deflationary policies which have had such a limited effect on our economic position up to now?
Mr. Jenkins: As I said to my hon. Friend the Member for Lewisham, West (Mr. Dickens), questions of that sort do not arise under this arrangement.
Mr. Birch: Referring back to the question asked by my hon. Friend the Member for Walsall, South (Sir H. d'Avigdor-Goldsmid), is not the basis of this agreement that we are turning obligations expressed in sterling into obligations expressed in gold?
Mr. Jenkins: No, and I think that the right hon. Gentleman, also, should wait to see the agreement.
Mr. Rankin: Can the Chancellor say whether his next statement will be made before the House rises for the Summer Recess?
Mr. Jenkins: No I cannot give a definite undertaking on that, but I did indicate the time scale. There are over 30 sterling area countries to be consulted. We propose to do this as urgently as possible. I assure my hon. Friend and the House that I shall be only too ready to report to the House at the earliest possible moment.
Mr. Hordern: The Chancellor said that there will be no increase in overseas indebtedness. Does he mean that to the extent to which sterling balances are run down they will not be replaced by loans which will be repayable?
Mr. Jenkins: I meant that there would be no increase in overseas indebtedness.
Mr. Orme: Can we take it from my right hon. Friend's statement that no letter of intent is involved and no guarantees are given to the international bankers on this occasion?
Mr. Jenkins: That can indeed be taken. When a letter of intent was involved, I, with the full concurrence—indeed, at the suggestion—of my right hon. Friend the Home Secretary, published it within 24 hours.
Mr. Bruce-Gardyne: Will the Chancellor of the Exchequer bear in mind in his discussions with other sterling area countries that, despite the views of the United States, the possibility of a change in the price of gold in the fairly near future cannot be ruled out? Will he ensure that no undertakings are entered into which would make this more onerous for this country?
Mr. Jenkins: I know the hon. Gentleman's views about this: he has reiterated them on many occasions. However, I do not think that this arises directly and I have no comments to make on this subject today.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: Order.

DEEP SEA FISHING INDUSTRY
The Minister of Agriculture, Fisheries and Food (Mr. Cledwyn Hughes): With permission, I shall make a further statement on the Government's review of future policy for the deep sea fishing industry.
As my hon. Friend the Joint Parliamentary Secretary announced on 15th May, we are satisfied that the industry can make an increasing contribution to import saving, given the assurance of adequate support and a continuing improvement in efficiency.
We propose to give an assurance of continued support to the deep sea fleet for a minimum period of five years. If the industry is to justify this support, it is essential that it should take all possible steps to improve its efficiency, both through technological development and through changes in structure and organisation which will promote better management and training. We intend, therefore, to operate the support that is being provided so that the benefit will go to those companies which can make the most productive use of these resources.

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In addition, the Industrial Reorganisation Corporation, which has been studying the industry, has informed me that it is willing to help the industry to find the best means of improving its efficiency. The industry, for its part, has assured me of its readiness to co-operate to this end.
On this basis, and on the assumption that the industry will make satisfactory progress towards the objectives I have described—a matter which we shall be reviewing from time to time with the Industrial Reorganisation Corporation—we propose to introduce for the three years beginning 1st August, 1968, a new form of operating subsidy. This will take account both of fluctuations in the industry's profitability and of the need to preserve an incentive to efficiency.
This will be done by adjusting a basic subsidy of £2 million by reference to operating profits in the preceding year. If these are less than £4 million, the basic subsidy of £2 million will be increased by half the shortfall; if they are more than £4 million, the basic subsidy of £2 million will be reduced by half the excess. The total annual subsidy, however, will be limited to £4 million and will not be allowed to result in an annual level of profit plus subsidy exceeding £7 million.
The distribution of the subsidy will be related to the operating efficiency of vessels and not as at present to their classification. The detailed arrangements will be worked out with the industry. The method of support after the first three years will be subject to a review in 1970 with the objective of maintaining a corresponding level of return in the two years commencing 1st August, 1971.
Legislation will be introduced early next Session to give effect to the proposals I have announced. Meanwhile, a scheme will be laid before Parliament providing for the maximum basic and special subsidies payable under existing legislation for the subsidy year beginning 1st August, 1968. These subsidies will in due course be set against the total sum due to the industry for that year under the new policy.
Mr. Godber: Is the Minister aware that his statement is not only extremely important to the fishing industry, but also extremely complicated? Will he, therefore, ensure with the Leader of the House
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that we have an opportunity to debate it before the House rises for the Summer Recess?
May I ask the Minister some very brief points which I think call for immediate clarification. First, he has referred to the deep-sea fishing industry; and reference was made to this in the debate. The right hon. Gentleman will recognise that this is a phrase which we have used in the past. Will he make it quite clear that this covers all except the inshore fishermen, so that there can be no doubt about it?
Secondly, when does he propose to start paying the subsidy? We note what he has said with regard to the payment under the existing scheme, but when does he expect to start paying the new rate of subsidy? Will he bear in mind the need to make a very early payment if the distant water industry is to remain in being?
Thirdly, is there to be a division between owners and crews as before? If so, how does the right hon. Gentleman propose to achieve it?
Mr. Hughes: The payment of the subsidy will have to await the passage of the Bill which, I hope, will be brought before the House shortly after it resumes in the autumn. My right hon. Friend the Leader of the House has heard what the right hon. Gentleman has said about a debate and has, I understand, indicated that he is prepared to consider having a debate before the Summer Recess.
As to the distinction between the inshore fleet and the deep sea fishing fleet, my statement is applicable to the deep sea fishing fleet.
Mr. James Johnson: Is my right hon. Friend aware that his complicated but nevertheless generous scheme will give immense satisfaction to all Members representing fishing ports and, indeed, to the House as a whole? Will he confirm that this scheme involves double the generosity of any award made by any former Government? Will he further confirm that this will provide a solid basis acceptable to the owners and also give a basis for a decent wage for the workers, including deck-hands, in the industry? Lastly, can he tell us—
Mr. Speaker: Order. Briefly, please. We have many fishermen.
Mr. James Johnson: When will the further talks take place, and what will be the content of those talks?
Mr. Hughes: I am grateful to my hon. Friend for his expression of appreciation of what is a new policy and one which I am sure will be appreciated by the whole industry. The purpose of the discussions with the industry will be to find the best way of distributing the total sum to individual vessels so as to encourage efficiency of operation.
I cannot pre-judge the result, but I think that the objective is quite clear. The question of the payment of the fishermen is a matter between the employers and the unions. The unions will be brought into these discussions. The important thing is that the industry should be prosperous and efficient. This is the best way of improving conditions and wages in the industry.
Mr. Wall: Can the Minister confirm that the sums he has talked about are for operational subsidies only and that building subsidies will continue? Is his Ministry looking into the question of import control as part and parcel of this scheme?
Mr. Hughes: The answer to the first part of the hon. Gentleman's supplementary question is in the affirmative. I am glad to be able to announce today that we have asked our principal E.F.T.A. suppliers to discuss the import position with us.
Mr. Dewar: My right hon. Friend will be aware that his statement will give great pleasure to the industry as a whole, offering the promise of long-term, or at least reasonable-term, security. Has further consideration yet been given to the minimum price scheme? Can he add a little more about the rôle of the Industrial Reorganisation Corporation?
Mr. Hughes: I am in touch with the White Fish Authority about its proposals for a statutory minimum price scheme. I have received the industry's assurance as to its readiness to co-operate with the I.R.C. I have made it clear that I shall be looking from time to time, with the I.R.C, at the progress of these discussions. The object of this exercise by the I.R.C. is to help the industry to improve efficiency.
Mr. W. H. K. Baker: May I press the Minister a little further? He said that his statement was about the deep sea fishing industry. I understood that the Government were having an inquiry into the whole fishing industry. Is not this so? Can he give an assurance to the House and to the inshore fishermen that some action will be taken to reconstruct that industry as well as the deep sea industry?
Mr. Hughes: The hon. Gentleman must distinguish between inshore fishing and deep sea fishing. There is here a very important distinction. I refer the hon. Gentleman to the speech made by my hon. Friend the Joint Parliamentary Secretary on this point, among others, on 15th May. The inshore fleet has done much better than the trawler fleet, but to encourage expansion we are proposing to maintain the existing level of inshore subsidies for the year commencing 1st August next. There is no question of cutting subsidies for the inshore fleet.
Mr. McNamara: My right hon. Friend's statement is very welcome, but will he take it that it will be even more welcome if it has a more positive showing on the settling sheets of the crews in the near future? From the longer-term point of view of the industry, when may we hope to see some of the positive results of the negotiations with the I.R.C, so that we may have a strong and viable industry in the years ahead?
Mr. Hughes: I hope that the I.R.C, which is now having detailed discussions with the industry, will report as soon as possible. I have had an assurance from Sir Frank Kearton to that effect. The important fact is that, taking the statement which I have made today with my hon. Friend's speech on 15th May, we have now created a new and forward-looking policy which will inject new confidence into the industry.
Mr. Bessell: The right hon. Gentleman's statement will be generally welcomed, but will he be preparing a similar statement for the longer term to secure the future of inshore fishermen? Second, how will the operating efficiency standard be worked?
Mr. Hughes: As I have said, inshore fishing is in a much better state than the deep sea fishing industry, and we believe

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that it is fully secured by the policies which we are now operating. I have heard no arguments to the contrary. As the detailed working out of the scheme is complex, perhaps, with your permission, Mr. Speaker, I might give a little more detail to help the House.
The amount of Government aid is a basic subsidy of £2 million payable if the industry's profits are £4 million. If the industry's profits are more than £4 million, the subsidy declines, and for each £1 million of industry profit above £4 million the Government will deduct £½ million from the basic subsidy of £2 million. Thus, if the profits are £5 million, the subsidy is £2 million minus £½ million, giving £1½ million subsidy.
Again, if the industry's profits are less than £4 million, the subsidy increases. For each £1 million by which the industry's profits fall below £4 million, the Government will add £½ million to the basic subsidy. If the profits are, for example, £3 million, the subsidy then is £2½ million.
I hope that hon. Members will read that in HANSARD tomorrow in elucidation of my original statement.
Mr. Speaker: Order. An additional detailed statement of that kind might well have been circulated in the OFFICIAL REPORT.
Mr. DalyellOn what criteria for subsidy purposes will the concept of operating efficiency of a vessel be judged?
Mr. Hughes: I ask my hon. Friend carefully to read the statement which I have made, in which I have tried to help the House on this complex subject.
Mr. Prior: The right hon. Gentleman's statement is welcome as a step forward, but does he realise that the crux of the matter will still be what can be done about imports, especially as other countries will always subsidise their fishing much more than we do?
Mr. Hughes: The question of imports is important, and I shall be having discussions about it. However, the fact remains that it will be largely the Exchequer which will benefit now if there is any restriction of imports.
Mr. G. Campbell: Will the right hon. Gentleman clarify his use of the term "deep sea fishing"? Does it cover all sea fishing other than inshore fishing? Second, will he state clearly whether the new subsidy proposals, with the ceiling which he has announced, will in no way affect the inshore fishing fleet?
Mr. Hughes: My statement was not applicable to inshore fishing. It dealt only with deep sea fishing, that is, fishing in near, middle and distant waters.

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

BUSINESS OF THE HOUSE
Ordered,
That the Proceedings on the Motion relating to the Medical Profession may be entered upon and proceeded with at this day's Sitting at any hour for a period of One and a half hours after they have been entered upon, though opposed.—[Mr. Grey.]

ORDERS OF THE DAY
  SUPPLY
  [24TH ALLOTTED DAY],—considered.

INDUSTRIAL REORGANISATION CORPORATION
4.25 p.m.
Sir Keith Joseph: I beg to move,
That this House, while upholding the independence of the Industrial Reorganisation Corporation, deplores its action in intervening with public money on behalf of one bidder in a merger operation, and regards such action as a dangerous precedent for the future.
In moving the Motion, we intend no criticism of either the management of the Industrial Reorganisation Corporation or of any of the managements of the firms involved in the episode to which we shall refer. We direct our criticism at the Government for the width of the legislation which they put through Parliament and the extent of the powers which they gave to the Industrial Reorganisation Corporation. We opposed that legislation because we feared that the powers given to the Corporation would enable it to compel mergers and to impose the dead hand and distortions of public control on some sections of industry.
We on this side admit that, during the first year or more after the Corporation was in action, we were reassured to some extent by its conduct. There seems little doubt that it carried out a useful task of easing mergers within the market mechanism. But what reassured us on this side evidently disenchanted the Government, since there were rumours in the Press of disillusion on the part of Ministers and of further legislation. The Industrial Expansion Act, as it now is, was brought to Parliament to give the Government powers to carry out what they had hoped the I.R.C. would achieve, but which the I.R.C. had been unwilling to set its hand to.
The achievements in the first phase of the I.R.C.'s life are listed in its annual Report, covering several pages. We cannot judge the degree of the contribution by the I.R.C. to each of the mergers mentioned in that Report, but, on the whole,
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at the time of the first Report, our fears were not realised.
We think that it is a clear gain to the nation that the Socialists now in Government have begun to realise that mergers, like most things in life, may be good, bad or indifferent, and there is nothing to be hysterical about in mergers as such. Since the Socialists came to power, there has been a veritable torrent of take-over bids. We hate to think of the uproar there would have been had such a torrent of take-overs occurred when the party opposite was on this side. It is a clear gain to the nation that the Socialist Party is now willing to judge take-overs on their individual merits.
Further, we reckon that the dialogue which the I.R.C. has been conducting confidentially with different parts of industry has probably been extremely useful. We recognise that the I.R.C. has, during its life so far, examined, among other sectors of industry, the firms making instruments and process control equipment. We recognise that this sector, or double sector, of industry comprises a wide range of inter-connected firms, and we know that within this double sector various negotiations were started and came to nothing.
The story on which we shall concentrate today began with the bid by the Rank Organisation for Cambridge Instruments, a bid which the Rank Organisation saw as a move to strengthen its already successful subsidiary Taylor Hobson. Cambridge Instruments, entirely legitimately and within its rights, opposed the bid both because it claimed that the price offered for the shares was not enough and because it preferred a partner different from the Rank Organisation.
It was then that Kent made its bid, which, like the Rank Organisation bid, was partly in cash and partly in shares. The I.R.C. then declared its support for the Kent bid. As I have said, the Corporation had certainly had discussions with different parts of the industry before. The I.R.C. then went into the market and bought Cambridge Instruments shares and Kent shares as well, which seems to have had the effect, to some extent, of raising the value of the Kent bid. After bids and counter-bids, and considerable share purchases by the I.R.C, Kent won control of Cambridge Instruments.

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There seems little doubt that, but for the I.R.C., the Rank Organisation would probably have won control of Cambridge Instruments. We feared shot-gun weddings when the I.R.C. was introduced. What we had was the first example of a short-gun separation. The First Report of the I.R.C. on page 5 says that the I.R.C.'s aim is:
"… not to impose theoretical blueprints of its own on industry,"
But, surely, that is exactly what, I am sure with the greatest of good intentions, the I.R.C. has in fact done.
Mr. Joel Barnett: Would it not be correct to say that the real shot-gun wedding would have been if Rank had been successful in taking over Cambridge Instruments?
Sir K. Joseph: What is done by private capital within the law is one thing: what is done with public capital, we shall argue, is quite a different matter and, as I shall seek to persuade the House, leads to all sorts of distortions.
I now turn to a quotation from page 6 of the Report, which states:
"… the I.R.C.'s task is to seek out those sectors of industry where structural change should be happening but is not—to identify the obstacles and try to eliminate them."
Precisely, but in this industry, the process control and instrument industry, structural change was just about to take place.
I shall comment on the bare facts which I put before the House, with which we are all familiar, but before I do so it would be fair to warn the Minister of the two questions with which I shall finish my speech. These are the two questions which we on this side hope that the Minister during his speech will clearly answer. Is it likely, in sectors of industry requiring, in the I.R.C.s view, structural change but where no such structural change is happening, that the I.R.C. will make a bid on its own behalf? Secondly, are we to expect that the I.R.C. is likely to make the same sort of intervention as it did in the Cambridge Instrument bid in a contested bid in the future? Those are the two questions which we hope that the Minister will answer. I bring this out part way through my speech only to give him the knowledge in advance.
I turn now to comment on the facts as I have portrayed them. We do not for
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a moment question the integrity and good intentions of I.R.C. We quite understand that the scientific instrument industry overlaps the process control industry, and we quite understand that Kent naturally wants to strengthen its process control capacity by marrying a creative scientific instrument company. We further understand that the I.R.C. is concerned to secure a British competitor for the great international companies like Honeywell and Foxborough. But there is no case here of an industry failing to regroup itself. Regrouping was taking place.
The Rank Organisation's bid was contested by Cambridge Instruments, which did not want a merger with the Rank Organisation, and the bid was contested by a rival bidder. The I.R.C. clearly did not intervene to save one company from a disasteful bidder. If that were the view of I.R.C. it could not possibly have intervened as it did in the G.E.C.-A.E.I. conflict. It is not the job of the I.R.C., and I am sure that they do not think it is their job, to rescue industrial maidens from distasteful captors.
The I.R.C. intervened because it thought that the Kent/Cambridge Instrument link would be better in the national interest than the Rank Organisation/Cambridge Instrument link, and we on this side of the House concede that it may well be so. On the other hand, no one, not even the I.R.C, can be sure that it will be so. No one can predict which grouping would be better. [An HON. MEMBER: "I would prefer to take the I.R.C.'s view, not the right hon. Gentleman's."] The hon. Gentleman says that he would prefer to take the I.R.C.'s view and not mine. I am not asking the House to take my view; I am asking the House to leave it to the market. The right hon. Gentleman the Member for Belper (Mr. George Brown) will have, I hope, his chance to catch the eye of the Chair.
The point we seek to make is that no one can be sure which grouping would be better in the national interest. Kent/Cambridge Instruments may make a huge success in process control; we hope it will. The Rank Organisation, rebuffed in one direction, may expand successfully on a parallel or a different tack. But if Kent had lost, perhaps Rank, with its marketing and financial as well as other strengths, would have

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enabled Cambridge Instruments/Taylor Hobson to have become an international leader, not in the process control industry but in the scientific and optical instrument world, and who can tell which would have been better for the national interest?
Who can be sure? If the Rank Organisation had been successful, Kent might have found a successful growth in another linkage altogether, not in the process control world. I have even seen it suggested that an ideal grouping would be Hilger and Watts, Cambridge Instruments and the instrument section of A.E.I. But for the I.R.C., two of these three would have been in one stable by now. Now, two of these three are locked out of each other's reach. I am not quite sure whether the Hilger and Watts/Rank Organisation bid is complete, but assuming that goes through—and that may be an assumption which I am not entitled to make—Hilger and Watts will be locked into Rank, and Cambridge Instruments will be locked into Kent.
Even supposing that one solution, the Kent/Cambridge Instrument solution, is preferable, much preferable or marginally preferable than the solution which the market would have achieved, the Rank/Cambridge Instruments solution, I ask the House and the right hon. Gentleman the Member for Belper as well as the Minister to consider, even supposing that, was it wise that the I.R.C. should fight for this solution, considering the ill-effects, because there will be ill-effects? The very fear of a petition of what the I.R.C. has done may distort future contested mergers. If I.R.C. enters the market in the future the battle will be virtually over. Who will go to the expense of bidding when such a potentate with such a purse enters the fray? The I.R.C. can not only buy shares in the company bid for, it can buy shares in the favoured bidder and so enhance the value of the bid.
The I.R.C. has had to inject finance into Kent by several ways, including the guaranteeing of deferred stock, but the I.R.C. will put a director on the board. What if all does not go well? The I.R.C. will find its money locked in and another firm will be subsidised with public money to compete unfairly with private
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enterprise. (The market solution would have produced none of these problems.)
The I.R.C.'s most important assets are, surely, confidence and the good will of industry. Suppose a man consults a family adviser about a girl and finds that the adviser helps a rival to carry the girl off. Will that man consult the family adviser again? It is most unlikely.
On the other hand, one must recognise that the fact that the I.R.C. has shown itself willing to back one of several bidders with public money may to some extent increase the queue of people seeking to get the I.R.C. on their side. One way and another we reckon that the Cambridge Instrument episode has damaged the I.R.C.'s standing with industry and has reduced its capacity to do good.
Mr. Austen Albu: Will the right hon. Gentleman use arguments in support of his thesis that the market, which is not a specialised agency, is a better judge than an agency specially set up for the purpose, especially when it is itself operating within the market?
Sir K. Joseph: Yes. I am saying that it is not possible to tell whether one group is more likely to benefit the national interest than another, since we cannot tell what the other alternative would produce. I suppose that it is conceivable that there could be a bid which would be so flagrantly against the national interest that even I would have to concede that an outsider could judge, but this was certainly not one of them.
The I.R.C. has and has had distinguished and devoted management and membership. Vigorous, intelligent, honourable men will not always abstain from using powers that are given to them. Shakespeare's Ulysses describes in six words the exact slope that we fear that the Government's legislation has given to the I.R.C—
"Power into will, will into appetite".
The I.R.C. was set up to help bring about sensible mergers. It was not set up to stop mergers which in its view are not ideal. The I.R.C.'s main weapons should be influence, confidence and good will. The I.R.C. is not a business. It is a public agency charged with the delicate mission which can lose more than it gains for the nation if it is clumsy, however good its intentions.

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If the I.R.C. forgoes or is legally denied the power to intervene by share purchase in a contested bid, no doubt there would be occasional second-best solutions or what would seem to be second-best solutions achieved by the market. Might not the occasional second-best solution be better than the errors, distortions, and lost good will of a fighting I.R.C?
Sir Frank Kearton is a redoubtable, determined and honourable man. Mr. Charles Villiers, the managing director of the I.R.C, is an outstandingly able man of wide experience and of the highest integrity. However, we still say that the Kent/Cambridge Instrument episode is a bad precedent. The resources and the power of the I.R.C. could in less honourable hands be instruments of dogma and damage. We condemn the Government for giving the I.R.C. powers that are too wide.
When we are the Government, if the I.R.C. is still performing a useful function, we shall reconsider the width of its powers very carefully. A facilitating I.R.C.—that is, facilitating the market mechanism—is one thing and may be useful. A fighting I.R.C. is another animal altogether, because it uses the taxpayer's purse to back its judgment on what, in almost every case, can only be a hypothetical and marginal difference in national interest.
I come back to the two questions that I warned the Minister that we shall look to him to answer. Is it likely that the I.R.C. will intervene again with share purchases on behalf of one of two or more rival bidders? Is it likely that the I.R.C. will make bids on its own behalf if mergers do not happen in sectors where it would like mergers to take place?
Because the I.R.C.'s powers seem to us to be too wide, I hope that my right hon. and hon. Friends will vote in support of the Motion. Meanwhile, we await the Minister's reply with great interest.
4.43 p.m.
The Secretary of State for Economic Affairs (Mr. Peter Shore): When I first read the Motion before us today, I was struck by two things. The first was the obvious contradiction between the expressed desire to uphold the independence of the I.R.C. and the strong criticism of
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its use of its powers which, if I was to agree, would oblige me to reduce its independence. Second, I was struck by what looks like a significant shift in the Opposition's attitude to the I.R.C. itself. They have asked the House to uphold the I.R.C.'s independence, and this can only mean, as, I think the right hon. Gentleman's speech made clear, that the Conservative Party has come to the conclusion that the I.R.C. has a rôle to play in improving the structure and efficiency of British industry.
I was waiting, therefore, with considerable interest for the right hon. Gentleman's speech. I was hoping to hear from him how I could at one and the same time uphold the independence of the I.R.C. while intervening in its affairs, and as I would judge it, restricting its operational flexibility. I was hoping for a clear and candid account of the evolution of the Conservative Party's thinking about the rôle of the I.R.C.
On the first point, the right hon. Gentleman's speech has certainly not helped. He has made it clear that he wants me to reduce its independence in one very important area, and about that I shall have something to say a little later on. On the second point he has been a little ambiguous. Nevertheless, we are entitled to draw the important conclusion that the attitude of right hon. and hon. Gentlemen opposite towards the I.R.C. has changed, and I for one welcome it greatly. I note that it is in very sharp contrast to the unconstructive and negative approach that they adopted 18 months ago.
As the right hon. Member for Enfield, West (Mr. Iain Macleod) is sitting on the Front Bench opposite, I would remind him of his own attitude at that time, when he said:
"Our attitude towards the I.R.C. is that of a preacher about sin—we are against it."— [OFFICIAL REPORT, 15th February, 1966; Vol. 724, c. 1228.]
Now, apparently, like many other good things that this Government have done, the I.R.C. has come increasingly to be accepted. The only thing now which is of concern is how it conducts itself and whether it may jeopardise the good will that it has already won in industry by being too assertive. As I see it, that is not a very formidable charge, although it is one that I shall try to deal with as my speech develops.

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Before moving to the main point of disagreement, which is the rôle that the I.R.C. has played in the Kent-Cambridge merger, I would sketch out what I see as the common ground existing between us, and I would wish to put the LR.C.'s action in a slightly broader setting where it can be properly judged.
In the first place, I think that we are agreed that many sectors of British industry are in need of restructuring. Certainly this is now widely accepted in industry. More businessmen than ever before are thinking in terms of larger units. This is not a matter of size for its own sake—certainly I would not wish to make a fetish of size—but size in order to achieve economies in production and in marketing to enable more intensive research and development programmes.
In this age of increasingly rapid technological advance and fierce competition in world markets from giant foreign firms, we must seek energetically to overcome those disadvantages that arise from structural defects.
Secondly, while it is obvious that companies themselves will be the main source of initiative in promoting structural change, it is clear that public agencies have also an important part to play. Recalling in the past decade the reorganisation of the cotton industry, the aircraft industry, shipbuilding and steel, only doctrinaire believers in a market economy will still affirm that there is no place for public intervention in the promotion of structural change.
The I.R.C, with its broad remit, has two special contributions to make to the process of industrial reorganisation. First, it can help to bring about mergers which would not otherwise take place or which would take place too slowly. Second, it is able to view the need for reorganisation more widely against a national economic and industrial canvas and not simply in relation to the opportunities and constraints which happen to face individual firms at any one time.
When the idea of the I.R.C. was first mooted about two and a half years ago, there was considerable scepticism and indeed hostility, not only from the Conservative Party but from substantial sectors of industry. Indeed, as the hon. Member for Eastleigh (Mr. David Price) will re-
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call, he described the I.R.C. at that time as
"… this unwanted waif of instant politics."—[OFFICIAL REPORT, 22nd November, 1966; Vol. 736, c. 1241.]
Since then, there have been encouraging and significant changes.
Over 400 companies have approached the I.R.C. in the 18 months since it was set up. It has supported two of the biggest mergers in British commercial history—the merger between G.E.C. and A.E.I., which has opened the way to the much needed rationalisation of the heavy electrical industry, and the merger between B.M.H. and Leyland Motors which has strengthened the British owned sector of the motor industry which is of key importance for the balance of payments. In the merger between English Electric and Elliott Automation, I.R.C. has supported the creation of one of the strongest European groups manufacturing automated equipment. If I may give one further example, I.R.C.'s support has enabled the Whessoe Company to secure more export orders and to save over 700 jobs in a development area—
Mr. John Nott: Is the right hon. Gentleman suggesting that these very important mergers would not have taken place if it had not been for the intervention of the I.R.C?
Mr. Shore: I think that it is very probable that these mergers would not have taken place. However, I think that we would all accept that this is something about which there can be no absolute evidence. There cannot be an absolute demonstration of an assertion that a merger would or would not have taken place without the intervention of the I.R.C. But the evidence very strongly suggests that those mergers would not have taken place. It is these and other achievements which have earned the I.R.C. its present high standing with industry.
Thirdly, there is agreement that it is essential for the I.R.C. to be completely independent of the Government in its day-to-day operation. As this is in the terms of the Motion, the Opposition must agree with that. Of course, Government Departments contribute to the I.R.C.'s work. They can and do feed in suggestions about sectors of industry which prima facie may need structural change.

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The reports of the E.D.C.s and other independent bodies are also relevant. But the decisions are for the I.R.C. itself. Further, the confidentiality of its relations with firms, the skilled commercial judgment required and the speed with which decisions have to be taken all require that the I.R.C. should be left to exercise its commercial judgment in the light of its statutory obligations.
Mr. John H. Osborn: How is Parliament to comment on the expenditure of public money if it thinks that an organisation such as the I.R.C. is not spending that money wisely?
Mr. Shore: As the hon. Gentleman knows, Parliament has the opportunity to debate these matters, as it is doing today. It also has the opportunity to initiate a debate on the annual report of the I.R.C. and it can and does question Ministers about week-by-week conduct of the I.R.C.
While I emphasise the need for operational independence, I also accept that the I.R.C. must observe certain principles and guide lines. Some of these are set out in the Act. Others are provided in the I.R.C. White Paper and in the various undertakings given by the Government during the debates on the I.R.C. Act. I am myself in close touch with the I.R.C. and I have no doubt that it is fully aware of the importance which we attach to projects which offer good prospects of early returns in terms of increased exports or reduced imports and equally aware of the importance which we attach to regional policy. Under Section 2 of the I.R.C. Act, as the right hon. Gentleman knows, I have power to issue general directions to the Corporation, but I do not have the power to intervene in particular cases.
I come now to the area of disagreement: whether it is right for the I.R.C. to back its independent judgment in support of one party in a contested takeover bid. In reaching a conclusion on this there are a number of relevant considerations. First, has the I.R.C. acted within the powers which Parliament has given to it? There can be no doubt about the answer to that. In fact, the Act enables the I.R.C. to take the neces-
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sary steps for the fulfilment of its statutory functions, and these include the promotion and reorganisation of any industry in the national economic interest. In the words of the Act:
"The Corporation shall have the power to do anything whether in the United Kingdom or elsewhere which is calculated to facilitate the discharge of its functions … including the acquisition, holding and disposal of securities."
We need not argue about that.
Secondly, were there good and substantial reasons for the I.R.C. to want to promote this particular merger? As the House will be aware, the instrument industry is not only important to the balance of payments, but important to general industrial efficiency. The I.R.C. judged that a merger between these two companies, Kent and Cambridge, would be of great benefit to British industry. The alternative, a take-over of Cambridge Instruments by the Rank Organisation, would not, in the I.R.C's judgment, have created a manufacturing unit with the comparable technical significance and value for the economy. The board of Cambridge Instruments also favoured a merger with Kent's, as the right hon. Gentleman has reminded us.
The I.R.C's judgment that this merger was in the national interest had the support of my right hon. Friend the Minister of Technology, who is responsible for the instruments industry. There are several reasons for this judgment. The industrial measuring and scientific instruments industry is a fast growing industry which has large opportunities for export earning and import replacement. Industrial measuring instruments are also of strategic technological significance because of their rôle in the development and application of automated industrial systems, which will be of increasing importance in our overall industrial performance.
In this work, the activities of Kent and Cambridge are strongly complementary. Kent is the largest British-owned firm making industrial control systems, while the strength of Cambridge is on the scientific side. The acquisition of Cambridge will give Kent a stronger research base for the development of future industrial control systems and should, accordingly, improve its competitive position both at home and overseas.

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We can argue across the Floor of the House about this, about the merits of the rival groups. My hon. Friend the Joint Parliamentary Secretary to the Ministry of Technology who is to reply to the debate will, no doubt, say more about the advantages of this grouping as seen from the direct knowledge which his Department has gained in its dealings with this industry, but in the last resort I hope that it will be conceded that the Board of the I.R.C. is particularly well equipped to make the right judgment, and a disinterested judgment, in this matter.
The Board of the I.R.C. consists of men of wide and varied industrial and business experience. Their decision to support the Kent-Cambridge grouping was taken after a detailed examination of the industrial activities of the companies and against the background of considerable knowledge of the scientific instruments industry. Their conclusion was that the balance of advantage for the development of this extremely important industry lay decisively with the Kent-Cambridge rather than with Rank-Cambridge.
Mr. Peter Hordern: Does the right hon. Gentleman appreciate that a most important principle in this matter is that the I.R.C. should reveal its own reasoning for the decisions which if reaches? Will he not say what were the reasons for this decision, or is he to wait until the Joint Parliamentary Secretary winds up the debate? The House would prefer to have the reasons now.
Mr. Shore: I have given some of the reasons and my hon. Friend will be adding to them. As the hon. Gentleman will be aware, the I.R.C. issued a succinct but informative statement on Friday giving its reasons for its course of action.
Having reached this judgment, that the best development of the scientific instruments industry would be on the basis of a Kent-Cambridge rather than a Rank-Cambridge merger—and this is the crux of the matter—should the I.R.C. have abandoned its judgment when Ranks made a further bid for Cambridge instruments? This is the question. As Kent on its own had insufficient financial resources, the choice before the I.R.C. was either to abandon this attempt to
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restructure the scientific instruments industry, or to support Kent with its own resources. If it had chosen the former course, in the light of the judgment which it had already reached, it would have been open to the serious counter-criticism that it had failed to do its duty. It would have meant accepting the second best—and I use the right hon. Gentleman's word—merger simply because one company, the less suited, had a longer purse than the other company, the more suited.
Sir K. Joseph: Its opinion of the second-best.
Mr. Shore: I accept that. I said earlier that this was a subject in which one could not hope to be able to put forward overwhelming evidence. It has to be a balance of judgment.
In the first instance, the I.R.C. attempted to find an agreed solution acceptable to the parties, but when this was rejected, the question had to be faced and it was at this point that the I.R.C. decided, and rightly decided, to use its funds in support of Kent.
The fourth question which one would want to answer in arriving at a judgment is whether there is anything inherently unfair about an I.R.C. intervention in such a contest. I do not think so. The point is made that the I.R.C. has large resources—under the Act, £150 million—but this is far from being a bottomless purse. When one considers its resources in relation to the need for restructuring in British industry and the many reorganisation and development projects which have already come before it, they can be described only as modest. But, more important, the I.R.C. is expected to operate on a commercial basis overall. It has to service the capital provided under the Act and it cannot afford to subsidise companies or projects and therefore in making share purchases it cannot go beyond a higher price than could be commercially justified.
What I have said so far demonstrates that the I.R.C. acted within its powers in this case, had good and sufficient reason for the course that it took, that it was not operating from any special position of advantage and that it acted according to the general rules which are expected of financial institutions in these matters.

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Against that background, let us see what the Opposition are asking. They are saying, apparently, that it is all right for the I.R.C. to act where there is no contest. They are also, I assume, saying that there is no objection to the I.R.C. expressing a view about a contested merger—at least, I heard no criticism from the opposite side of the House when the I.R.C. supported the G.E.C. bid for A.E.I. Apparently, therefore, what the I.R.C. must not do is to become involved financially in a takeover struggle. That is the right hon. Gentleman's position.
The Opposition have nothing against take overs or disputed mergers in general. It is perfectly all right for any company, British or foreign, with sufficient spare financial resources to engage in a takeover struggle. It is all right for everyone, that is, except the I.R.C. Such an exception would clearly need to be argued very convincingly before it could be accepted. It certainly has not been done today. The crucial difference between the I.R.C. and other financial bodies is that the I.R.C. is a statutory body with a statutory obligation to have regard to the wider economic interests of the nation. The Opposition argue that this requires the I.R.C. to have less freedom than a commercial company. My belief is that it argues the exact contrary—namely, that the I.R.C. should have more freedom. All that we are seeking to establish is that it should have equal freedom in its commercial activities.
Moreover, if I were to impose a limitation of the kind that the Motion suggests, the credibility and effectiveness of the I.R.C. would be seriously impaired. One could readily envisage a situation in which the Corporation has been working for months to bring about an important and agreed merger. Then a new party of takeover bidders with a longer purse appears and from that moment the I.R.C. would have to abandon the project and withdraw. It would, indeed, be a paper tiger. I am not prepared to skin it.
I have reached the point where I can answer the right hon. Gentleman's questions point blank. First, if I may take them in reverse order, I am not prepared to give a general directive to the I.R.C. to prevent it from taking part in contested bids of the kind that Kent/Cam-
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bridge illustrates. In reply to the first question, this is certainly at present a hypothetical matter and I would, obviously, consider very carefully the views of the I.R.C. upon it.
All I can say is that it is the job of the I.R.C. to get on with the task of promoting structural change. It will clearly always bear in mind the question of whether there are people who are willing and able to help to carry out the job in a certain industry. Quite clearly, however, the I.R.C. has the powers under the Statute as I have described.
To sum up, I am satisfied that the Corporation has responsibly exercised its judgment in this case and I do not see any reason to question its interpretation of the requirements of the public interest under the Act. I see no cause to limit the action of the I.R.C. in the way suggested for the future.
It is, however, right for me to stress one point. The I.R.C. itself prefers to proceed by agreement, and most of its work is in persuasion and in the search for an agreed solution. But there will be situations, however infrequent, when total agreement will be lacking but where the I.R.C. will need, in the national interest, to use its financial power either to promote changes which are desirable or to resist changes which are undesirable. It must, therefore, have the resources and the freedom to use them if it is intended to make its contribution to increasing the efficiency and competitiveness of our industries.
Mr. J. Bruce-Gardyne: I have not yet heard the right hon. Gentleman answer one of the most important points made by my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph): that if the I.R.C. was to behave in the way that it has behaved in the Kent/Cambridge affair, many companies which might in the past have considered consulting it will decline to do so.
Mr. Shore: I understand that point, but this is precisely one of the matters on which one can expect that the judgment of the I.R.C, given its experience and its background, would be sufficient to enable it to form a view as to how best to conduct its own operations.
The I.R.C. is one of the pacemakers in the process of change and it would be folly, just when it is getting into its stride,

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to restrict the use of the powers already conferred by Parliament. Those who dislike change will dislike the I.R.C., but those who wish to see Britain become competitive in the modern industrial world will welcome its efforts and wish it every success.
5.6 p.m.
Mr. Peter Hordern: I listened with great care to the Secretary of Stale for Economic Affairs during what, I thought, was a very disappointing speech, but as the subject of this debate, which has been chosen by the Opposition, was to inquire into the rationale of the takeover by George Kent of the Cambridge Instrument Company, we on this side were more than disappointed that no meaningful evidence whatever was produced by the right hon. Gentleman in this respect.
The Motion deals first with the I.R.C. in the terms that it wishes to preserve its independence. I should like to say how strongly I support the sentiment. I wish the I.R.C. to be so independent that it withers away. I feel that the Industrial Reorganisation Corporation Bill as a whole when it was introduced into this House was based on ignorance of the market and prejudice against the operations of the market.
When my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) suggested that we might make a review of the I.R.C. when we on this side returned to government and that there might be a place for what he termed a facilitating I.R.C, I only remind him at this stage, to help him in his consideration of the matter, that we voted against the Bill both on Second Reading and on Third Reading. I hope that my right hon. Friend will take that into account.
There is, I suppose, a place for an I.R.C. which acts as a kind of talking shop. What I am against is an I.R.C. which acts in a direct and interventionist way. The Secretary of State has proudly acclaimed himself as an interventionist. That is what I object to.
There is nothing wrong with the market system, and, indeed, there is nothing wrong with the economy, that cannot be altered by other arrangements. We have just had the Brookings Report on the shortcomings of British management and the report of the Donovan
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Commission on the trade unions. There is nothing in either of those two documents so far as they affect the economy which cannot be put right by a reduction of tariffs, a tightening of monopoly legislation and a complete recasting of the taxation system.
There is no evidence whatever of any shortage of capital in the free market either for short-term, medium-term or long-term projects. This is in entire contradistinction with the position in other countries and certainly in all our competitor countries, with the exception of the United States. In France and West Germany there is an acute shortage of private capital for industrial ventures. It is noticeable that only in Italy is there any form of organisation which is comparable to that of the I.R.C. The I.R.I. was founded in the first place long before the war only because of the complete absence of capital from the private system.
I well remember that in the Committee on the Industrial Reorganisation Corporation Bill the Government did not quite know what the criteria of the I.R.C. would be. It was only because of pressure from this side that the word "profitability" was inserted into the Bill at all as one of the criteria on which the I.R.C. should act. We can but observe that in the course of this particular affair the I.R.C. is attempting to become directly competitive with merchant banks, and this is the point with which I wish to concern myself for a moment.
I should like to ask the hon. Gentleman who is to wind up the debate what were the terms on which the I.R.C. was able to raise the money not only for this operation but for any other current operations it may have. The Government will know that it is quite impossible for the Government to raise money at under 8 per cent. in the market at the moment. It is my belief that, in fact, the money has been made available to the I.R.C. at a substantially lower rate than this and I should like the hon. Gentleman to say exactly what the rate is.
Furthermore, the terms of repayment are certainly terms which would not be available to any private merchant bank in the City, for during this particular negotiation a structure of deferred capital was instituted on which no dividends will

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be payable till 1973. Therefore the I.R.C., in this operation and, I believe, in others, is borrowing money more cheaply than it would be available even to itself in the open market, let alone to other companies, and as regards repaying the money, it is borrowing on terms which would certainly not be available to outside bodies.
The right hon. Gentleman claimed ad nauseam that this particular operation was in the national interest. I must say that this is one of the terms which always make my heart sink whenever the right hon. Gentleman or the party opposite use it in terms of commerce or industry. This merger of George Kent and Cambridge Instruments was apparently in the national interest, but the merger between Cambridge Instruments and Rank's was apparently not in the national interest. It cannot have been absolutely in the national interest because quite clearly the Government and the I.R.C. would not have been prepared to pay in more money unless they were certain it was going to be brought within their control, and I do not think that would have been the position.
Suppose, for example, Rank's had made a higher bid. Would it then have been open to the I.R.C. to support an even higher bid from Cambridge Instruments? I cannot believe that would have been the case, and that is why I would again say that the term "national interest" cannot be an absolute term, but only a marginal term, if there was a preference between one solution as against another.
What is the national interest in this context? Surely the only context in which it can be reasonably described as the national interest is the context of profitability. In this particular case it happens that the Rank/Taylor Hobson group of instrument manufacturers has increased its profits at the pre-tax level from 1962 to 1967 from £184,000 to £1·2 million, whereas the George Kent position in the same period was that its pre-tax profit rose from £623,000 to £1·2 million; that is to say the Rank/Taylor Hobson group was certainly six times as profitable in that time whereas the Kent Group only increased its profit by twice during the same period. So we can only suppose, from this arrangement, that profitability was not a criterion which was operating for I.R.C. in this case.
Mr. Albu: Does not the market take account of that? Was not the Rank price based on over 40 prices-earnings ratio?
Mr. Hordern: I am sorry, but I do not quite follow the hon. Gentleman. All I am saying is that the Government were prepared through the I.R.C. to support a company whose profitability was much less than the other one, and on grounds of the term "national interest". That is the term which I am examining at the moment—"national interest".
Was the purpose, then, to save foreign exchange? Presumably, that is one of the criteria which the I.R.C. was using. It is perfectly true that imports of instruments are rising and rising very fast, and I think it is a matter of concern just as the increase in imports generally is one of concern; but, of course, it is true that imports of textiles and a host of other articles are rising, as is well known to the party opposite, and it is of great concern and trouble to the Government.
So the logic seems to have been that because two American companies, notably Honeywell and Foxboro, both make industrial and scientific instruments the solution was to find a scientific and an industrial instrument manufacturer and put them together, and then we would have a worthy competitor for those two American companies. In fact, both George Kent and Cambridge Instruments, as separate companies, have been very disappointing in their earnings records. The earnings on capital employed by George Kent between 1955 and 1967 was halved from 15·7 per cent. to 7·8 per cent., and the Cambridge Instrument record over the same period was even worse. Its earnings on capital employed fell from 31·3 per cent. to 13·5 per cent. I can really see no reason or logic for an amalgamation of two companies with a disappointing earnings record and for supposing that this is a guarantee of success in competing with Honeywell and Foxboro.
Now, of course, the position is changed, and George Kent has willy-nilly become a matter of national interest, and, whether it succeeds in competing successfully with those two large American corporations or not, it will have to get the support and backing of the I.R.C. or some other Government agency. I do not know whether the Government

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have made any estimate at all of the money which would be required if we are to compete with those two large corporations.
It must be asked, why this particular field has been selected when there are so many other fields which need subsidies. Is it to compete with American companies, or simply because imports are increasing to such a large extent in washing machines or socks or silk scarves all articles of which there are high imports? If the criterion is to save foreign exchange, then why should not any company which feels the faintest breath of competition from abroad also appeal for help? How, on this argument, can the appeal possibly be refused?
It will be said that the help can be given only if it fits in with the logical pattern devised by the I.R.C., and this is my second objection to this action because what is the evidence that this merger was in the national interest at all? What we have to ask is this. On the basis of information gathered by the I.R.C. a certain pattern was devised which I.R.C. considered to be in the national interest. We do not know who gathered this information. We do not know what the assessment was. Why not? Why is this information not being made available to the House? If this sort of action is taken in the national interest, why is it not being explained to the nation? All we have is what is vouchsafed to us by leak and by the Kent board in the reasons which it gave to its shareholders after the intervention of the I.R.C. This was most interesting because the Kent board said this:
"Kent, as already disclosed, is nearing the end of its expansion programme in the industrial field where market surveys suggest that demand will expand by 8½ per cent. a year over the next 10 years. The scientific, analytical and medical markets will have a much faster rate of growth of about 13 per cent. This is a cogent reason why an expansion-minded firm should look at scientific instrument manufacture."
If Kent was looking so avidly at Cambridge Instruments for expansion on scientific instruments, that was the reason why Rank/Taylor Hobson was also looking at Cambridge Instruments. I therefore ask: what practical reasons were there for declining or refusing to allow the Taylor Hobson bid to go through? I understand that the Rank people were
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interviewed by the I.R.C. on 29th April when the I.R.C. showed an ignorance of the Taylor Hobson Group which was quite astonishing. According to information given to me, the Rank board was never properly consulted or allowed to give other reasons why its merger should not be allowed to go through. This can only mean that Kent sees its future profitability in scientific instruments just as the Rank organisation did. Why did the I.R.C. support Kent? Presumably because it sees industrial instrumentation as a declining sphere and wishes to prop it up as it does other declining industries and as it does in an industry in some difficulties, namely, the computer industry. I suggest that, once again, it is the fear of American competition. I think it is time that there was some clear thinking on this subject.
First, we ought to realise the size of this problem. Some £10,000 million a year is spent on research and development in the United States. The figure for this country is about £850 million. It means that over the whole field it is likely that there will be more scientific discoveries made in the United States and more development is possible because of the scale of expenditure. When one considers the size of some of these corporations—Honeywell, for example, is very much interested in this sphere—one must seriously consider what the total cost to the country is likely to be if George Kent is to be propped up in this way. For example, the Honeywell Corporation has a total stockholders' equity of 384 million dollars, of which some 180 million dollars is on control equipment. It is, in other words, between four and five times as large as George Kent. But the Honeywell Corporation, in its operations from this country, is a net exporter of control systems. Therefore, we have to recognise that we are shoring up one company as against another which is employing British people and earning foreign exchange for this country.
My third criticism of this intervention in the market is the method of operation. I waste no sympathy on the Cambridge Instruments' shareholders. Frankly, I think they have been extremely fortunate in the whole of this proceeding. But the Kent shareholders have found, in the process, that their share capital has been considerably watered down.

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I come now to a most extraordinary feature of this bid, namely, the holding of the Royal Society of some of the Cambridge equity. It so happened—I do not know how—that the Royal Society had a holding of some 11 per cent. in the Cambridge equity. It is a fact—and I have checked it for myself—that, after the I.R.C. intervened, at no time was the George Kent bid as valuable as the Rank bid. For that reason one must ask why the Royal Society ever accepted the George Kent bid. It must have been extremely badly advised. I appreciate that this is a matter for the Royal Society, but one of the most amusing ironies of the whole situation is that the head of the I.R.C. happened to be a fellow of the Royal Society. The confusion of interests must have been extremely hard for him. I have no doubt that he kept out of the recommendations altogether. But, if he had to give a recommendation, he would have had to advise the Royal Society to accept the Rank bid.
As I have said before, what irks me about this arrangement is that the I.R.C. has used money which is not available on the same terms to outside sources. I have already asked whether we might be told what the rate is.
There is no doubt that Cambridge Instruments should have gone to Rank on the basis of it being a higher bid, and the chances are that Rank would have made Cambridge Instruments a more profitable affair than George Kent will ever do.
As my right hon. Friend the Member for Leeds, North-East mentioned, the whole tone of the I.R.C. has changed under its new managing director. When Mr. Grierson was there, in his interim report he said that he would not impose a theoretically conceived pattern. This is precisely what the I.R.C. is now attempting to do. There is no logical end to this form of intervention that one can observe, but we are not even permitted to see the basis of the logic. That is what is so insufferable about the whole arrangement and the activities of the I.R.C.
I have no doubt that other companies will be reluctant now to give information to the I.R.C. on a confidential basis.
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That is up to them. What is certain is that, unless the market and the country as a whole has a clear conception of what the I.R.C.'s basis of operation is, it will act on the understanding that an intervention may be made in the market at any time by a group, accountable apparently to nobody in public, drawing up its theories in secrecy and yet never allowing them to emerge except in direct action in the market. As I started off by saying—
Mr. Alba Mr. Alba rose—
Mr. Hordern: As I started off by saying, I am certain that this kind of direct intervention in the market is wrong. Therefore, I hope that my right hon. Friend, when he gives the matter further consideration, will adopt what was a perfectly proper attitude in the first place, namely, to scrap the I.R.C. at the first opportunity.
5.27 p.m.
Mr. George Brown: The interesting thing about the two speeches we have had so far from the Opposition is the difference of approach. The Motion has been carefully drafted to exclude the I.R.C. as such from criticism or censure by the Opposition. The right hon. Member for Leeds, North-East (Sir K. Joseph) was careful in his speech to do the same. The right hon. Gentleman said that they might look at its powers or the way it acted, but he pretty well gave it a certificate that, should the Opposition, unhappily, ever come back to power, the I.R.C. would stay in business. His hon. Friend—
Sir K. Joseph Sir K. Joseph rose—
Mr. Brown: I will give way, but I should like to make one thing clear. The debate did not start until after twenty minutes past four. We have less than 2½ hours to discuss this matter and the first three speeches, including the two Front Bench speeches, have taken almost an hour and 10 minutes. If I am to be interrupted all the way through, this will preclude anyone else having a chance to speak. However, if I am allowed to go on—and I did not interrupt anybody—I can get through quickly.
Sir K. Joseph: I did add as a qualifying clause to our view of the I.R.C, "if it remains useful."
Mr. Brown: Then I shall look very closely in HANSARD tomorrow to see if those words are there, because I did not hear them. If they are there, then most of what the right hon. Gentleman said had no meaning at all. He was really making a speech facing both ways, like Joseph's coat of many colours, and he is back en accord with his hon. Friend the Member for Horsham (Mr. Hordern). In that case I will waste no more time on it, because it meant nothing. The right hon. Gentleman is telling me that he faced north and south at the same time.
The other thing that struck me about the Motion is that it is carefully drafted not to deal with the merits of the Com-bridge-Kent or the Rank-Cambridge tie-up. The Motion is carefully drafted to deal with the principle whether the I.R.C. should ever intervene in a disputed bid. We have, however, today been wholly concerned with a special piece of pleading whether Rank should have been the successful bidder or somebody else.
I know the Chairman of the I.R.C. I am associated with him in another capacity, and I am proud to be. When the hon. Gentleman referred to him being a distinguished Fellow of the Royal Society, I thought that that was really the sort of thing which disclosed the absence of any real case. Coming as it did from a Member of the party which contains two prominent Privy Councillors, one on the Front Bench who is not here today, and one on the back benches who is not here either, who were involved in this matter on the other side, I think that it would have been better had the matter not been introduced.
Mr. Hordem: I cannot see why that matter should not have been introduced.
Hon. Members: Apologise.
Mr. Hordern: It is relevant to the issue we are discussing, and I should not dream of apologising.
Mr. Brown: If the fact that Sir Frank Kearton is a Fellow of the Royal Society is to be introduced to cast doubt on whether he was acting wholly independently—[HON. MEMBERS: "NO."]—In that case I see no reason for bringing in that fact. Nevertheless, I think the House should know that the right hon. Member
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for Barnet (Mr. Maudling) acted as adviser to Ranks, and that the right hon. and learned Member for Wirral (Mr. Selwyn Lloyd) is a director of Ranks and Odeon and took an active part in the market in support of the Rank rate.
Sir K. Joseph: What is wrong with that?
Mr. Brown: I cannot give way. If the issue is to be discussed on that basis, let us have it both ways and not put up with the kind of snide remarks that were made.
I propose to be brief, and I shall therefore not go over the arguments and the philosophy which lay behind and were deployed in setting up the I.R.C. I urge hon. Members to read those debates again and to consider how many others in the world are now doing a similar exercise, and for much the same reasons.
In view of what has been said, and in view, too, of my association with the establishment of this body, I should like to pay tribute to it for what it has done in its opening period. I think that the members of the Corporation were very wise in their careful phasing of the development of their activities, and I pay tribute to them for their meticulous and patient examination of the projects and ideas put to them, and also for the fact that, having established themselves, they have taken specific and determined action.
The hon. Gentleman said that he wanted the Corporation to be "so independent that it withered away". We, on the other hand, want it to be independent of Government direction or veto, but nevertherless so determined that it becomes a vigorous and effective part of our business.
I commend to hon. Gentlemen opposite and others a careful reading of the I.R.C.s Report I should like others who operate in what the hon. Gentleman called "the market" to produce reports in the same kind of detail. There are many City institutions—and I am not referring to the leading merchant banks—about whose activities I should like to know a good deal more. If I knew as much about them as the hon. Gentleman does about the I.R.C. we could have a much more efficient debate about the operation of the City.

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I suggest that hon. Gentlemen opposite should read the very detailed, very full, and if I may say so without being patronising very commendable accounts, by Peter Wilsher in the Sunday Times, by Mr. Anthony Bambridge in The Observer, and the reports in the Economist during the last few weeks. Despite what the hon. Gentleman said, there is no doubt among informed opinion, among informed commentators, and among those who are not so personally involved in the financial consequences, that the I.R.C. in its first year has done a tremendous job. It is interesting to note that hardly any informed commentator has come out even against the Cambridge-Kent arrangement. Questions have been asked about the future consequences of this. It has been asked whether this will make the I.R.C.'s job easier or more difficult, but there is very little support among informed opinion for the view that the I.R.C. was wrong to try to bring about a solution in this case.
I believe that what has been done reflects great credit not only on Frank Kearton, Ronnie Grierson, and Charles Villiers, but on all their associates, board members, and staff members. I feel that on the first occasion on which we debate their activities it would not be a bad thing to give them credit for a considerable effort of a new kind. I think that it also provides some justification for those of us who pushed this idea through against much prejudice and opposition only a short 18 months or two years ago.
We have here an illustration of the way in which the Front Bench of the Opposition has now notably switched its view. In 1966 the Motion was to "decline to accept". The right hon. Member for Enfield, West (Mr. Iain Macleod) was against sin. This was sin, and that was that. Now, by clear implication, the Motion accepts the existence of this body, but goes on to argue about details of how it works.
The argument appears to be based on two things, both of which are fallacious, and in some respects downright objectionable. The first—and I think the right hon. Gentleman put this clearly—is that the Corporation should not intervene—that is to say, it should not
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use its judgment where there is more than one bidder in a take-over operation. Secondly—and this is an extension of the first thought—it should not use public funds to bring about one particular merger rather than another. The basic fallacy in that seems to me to lie in the fact that the right hon. Gentleman was thinking that a merger, or mere size, would be good in itself, whatever the consequences, and that the Corporation should be concerned only where such a merger was not coming about.
That cannot be accepted, for a variety of reasons. It is not the fact of a merger. There is no virtue in size as of itself. If there is to be virtue in a merger, or size, it depends on other factors. It depends on the kind of merger: on who is merging with whom. It depends on whether the managerial levels and the technical competence which will emerge are worth while. It depends on whether we are getting an effective integration of complementary forces. The hon. Gentleman had a lot of trouble dealing with the phrase "national interest", but that is what we mean. The whole basis for the future development of the integrated organisation must depend on whether the project is sound and advantageous, not just the happening of a merger.
As was pointed out by Mr. Wilsher, the history of our industry over many years shows case after case of unsuccess being married to unsuccess as a result of the market's free operation and the creation of a bigger failure than the two we had before.
Our industry suffers from two problems. First, it is too fragmented. Secondly, much of it has come together without any rational basis for doing so. In my view, developments cannot be left to the forces of the market. They cannot be left to be decided merely on the basis whether something is immediately profitable for somebody. When I had something to do with the writing of the White Paper in the early stages—it was subsequently taken over by others—which led up to producing the Act, we carefully specified that it was part of the I.R.C.'s business to exercise its judgment. We gave it authority to act upon its judgment when it had made it. Far from its being, in the words of the Motion, "a dangerous precedent", I regard it as an absolute requisite.

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The Opposition's attitude seems to stem from another and more basically doctrinaire view, which again is in two parts—first, that all good mergers will come from the operation of market forces, and secondly, that public activity and finance, if used at all, should be used only outside that area. This adds up to the view that what is profitable in the eyes of the finance market must be good and should be left to the market, and what is not profitable in the eyes of the market probably should not be carried out, but if it is, should be done only at public expense.
I cannot accept that in these days everything in respect of which somebody cannot make enough profit shall be unloaded on to the taxpayer. Nor can I accept that the Board should not deal with matters in respect of which somebody sees a good profit. There is no clear black and white distinction between what is profitable and what is not in this respect, even in money terms.
Many other factors must be taken into account. They affect the degree of immediate profitability and the longer-term considerations. The real argument today does not concern the minutiae of the merits of the case, on which the bulk of opinion comes down on the side of the I.R.C. The real argument which the Opposititon are advancing is that we should maximise immediate or short-term profit which will accrue to a few on a particular market operation, rather than, as my hon. Friends and I would do, subordinate that consideration to other wider and longer-term interests.
That is the issue on which the I.R.C. was bold enough to make a judgment and take a stand. That is the difference between us. The I.R.C. makes it abundantly clear in its statement that it has acted on the second basis—that is to say, it has subordinated the short-term, immediately profitable argument to other considerations. I have heard it argued that it should have put out the statement earlier. I do not regard that as a very relevant argument. It is naive to think that anybody operating in this field could put out a statement in the course of an operation. The statement makes it clear why the Board acted, and on what basis it did so—and I accept it.
Sir K. Joseph: The right hon. Gentleman is trying to wrench the argument to
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suit his party purposes. My hon. Friends and I believe that the national interest cannot be judged in the way that the I.R.C. presumes to judge it.
Mr. Brown: I have said clearly that that is the difference between us. The right hon. Gentleman, with his background and City experience, and the stockbroker who spoke just before me take a view that is different from mine. I have pointed what the difference is, but so long as we are clear that the I.R.C. acted on the second basis I can argue that in my opinion it acted correctly.
I applaud its acting in the way it did, and I shall be willing to defend it anywhere. Nobody except the right hon. Gentleman, in one slight intervention in his speech, has gone so far as to say, as I do, that one cannot doubt that the collective experience, expertise and background of those who make up the I.R.C. justify its claim to be able to exercise such a judgment. I think that it will be generally agreed that both on the Board and on the staff of the I.R.C. there is at least as much experience, expertise and background in private enterprise as hon. Members opposite can muster at any time. I see no reason to doubt the ability of the I.R.C. to make a judgment. That is why it was appointed, and that is why its individual members are so highly regarded in respect of their mostly-private enterprise activities.
I agree that any exercise of judgment involves a degree of risk, but believe no case has been made out anywhere and practically all informed comment suggests the opposite. But this is so here. If we are to refuse the Board any degree of judgment, there is no point in having it. If we say that it must never take a risk nothing will be done, although we know that somebody must get busy. I therefore congratulate the I.R.C. on its decision and upon its work to date. I hope that it will not be put off by any criticisms that might be made of it—much less by what I regard as self-evidently ill-considered Motions such as this.
As I said when we began the whole idea and brought in the original White Paper, I hope that industrial and financial interests outside—despite what may be said here this afternoon—will continue to recognise the value of the work that

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such a body can do. France and Japan are now embarking on the very same exercise, for the very same purpose. Sweden and Germany have not only been trying to do it but have been asking the I.R.C. to tell them how it is doing it. This is an area in which Britain was behind but in which she is now catching up and even going ahead. Nobody who knows the urgency of the need to restructure British industry can doubt the usefulness of the I.R.C., taken alongside other efforts to modernise our industry.
Let us not, because of prejudice that we find it difficult to get rid of—and this applies to all of us—halt this process now for reasons that will really be miserably prejudiced. This is a necessary part of our armoury for winning through, and I hope that the House will reject the Motion with contumely.
5.48 p.m.
Mr. Peter Bessell: The right hon. Member for Belper (Mr. George Brown) has a sound reason for congratulating the Government and himself—if that is the right term—for the establishment of the I.R.C. We on the Liberal benches supported its inception, and nothing that has happened—not even the present emergency—has caused me, for one, to regret the advice that I then gave my colleagues, and which I believe the events of the last year have proved to be basically correct.
This is to be a short debate and I shall therefore confine myself to asking the right hon. Gentleman only two questions. I hope that I may have answers at the end of the debate. It was a serious decision on the part of the I.R.C. to use public money to prevent one merger from taking place and to enable another to occur.
Therefore the facts, however, confidential they may have been at the time of the discussions between the I.R.C. and the companies involved, should be the subject of a very full disclosure. I would like to hear from the right hon. Gentleman that, because of the nature of this action, and because it is virtually unprecedented for public money to be used in this way, we shall have such a disclosure. I hope that he will not refer me to the
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statement which appeared in the Daily Telegraph on Saturday because, although I have the utmost respect for the City Editor of that newspaper, whose words I often follow with great interest, and whose judgment I respect in all ways, I do not believe that the I.R.C. has given the kind of disclosure necessary to enable any of us to arrive at a sound judgment.
The second point which I wish to raise is one raised briefly by the right hon. Member for Leeds, North-East (Sir K. Joseph), when he rightly said that none of us could assess entirely the consequence of any merger or the creation of any monopoly in consequence of such a merger. We may not know what is the final outcome, and we do not know whether it will prove to be in the public interest. However good our judgment may be in one matter, it may be faulty in another, and the I.R.C. has no superhuman powers. I am sure that the right hon. Gentleman the Minister would not wish to ascribe such powers to it.
Therefore, I ask this second question, which I will divide into two parts. Would he not agree that there might be a case for extending the powers of the I.R.C, even though no merger created by it can create a monopoly, so that it is obliged, year by year, to discover and report in its annual report on the effects of the mergers for which it has been responsible? Secondly, in those mergers which virtually create a monopoly, might it not be wise for the Government to look at an extension of the powers of the Monopolies Commission, to see whether there should not be a continuous watch maintained upon any monopoly position which may be created, because of the possible dangers which might result to the public and private sector and the nation as a whole?
There is much more that I would have liked to have said, but we are forced by our time-table to a very limited discussion. I will confine myself to these questions and I hope give an opportunity to other hon. and right hon. Gentlemen who have not yet spoken.
5.52 p.m.
Mr. W. Howie: Like the hon. Member for Bodmin (Mr. Bessell), I shall try to be as brief as possible, much briefer than I would otherwise have been, so that other hon. Members may have the chance

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to speak. This is, unfortunately, a very short debate. My interest in it arises from the general interest that we all have in the I.R.C., but particularly from the fact that George Kent is one of the more prominent firms in my constituency. My constituents stand to benefit from this merger and will be interested to note that the Opposition finds the action of the I.R.C. deplorable.
I am a little surprised at the way in which the Opposition has acted. I would have thought it sufficient for it to take the opportunity of this so far unique action on the part of the I.R.C. to seek information. To go out on a limb and to deplore it seems to go rather far. My right hon. Friend the Member for Belper (Mr. George Brown) drew attention to the fact that the Motion was in somewhat general terms. It is worth paying some attention to the specific matter and drawing some general conclusions from it. George Kent is an old-established firm with a high reputation in the industrial measurement and control sphere. It is the largest independent British-owned company manufacturing industrial and process control instruments and, as such, a fairly obvious base for a national industry.
It is worth paying some attention to the instrument industry for a moment. An important factor is the changes which have been taking place over the years in the industry. More and more industrial instruments are taking on the characteristics of scientific instruments, of laboratory equipment. They are becoming more sophisticated than in the past. This is a market in which George Kent has made minor invasions only over the years. It is predominant in industrial measurement. Although it operates in the scientific area it is a lesser concern there. It is a market in which Cambridge Instruments has been pre-eminent, with a strong reputation and good connections with the university world, and other institutions.
The two firms complement one another. The area in which one firm is strong is that in which the other is weak. Taken together they cover a broad range of the instrument world. If, as is sometimes said, the laboratory instrument of today is the industrial instrument of tomorrow—and this is true—the Kent-Cambridge merger is a natural and the newly-merged firm will be able to accel-
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erate this continuing process. If the merger is industrially desirable, and this is what the I.R.C. meant when it said that it was thought to be in the national interest, then the new company will form the basis for further development in industry.
This is where I revert to the "potted history" mentioned by the right hon. Member for Leeds, North-East (Sir K. Joseph). What he omitted to say was that the I.R.C. became interested in the Kent-Cambridge merger when it began to look beyond the immediate merger. When the I.R.C. began to look towards the future development of the industry, after the merger, it saw that the complementary functions of the two firms gave a basis for development stronger than that of their rivals.
Having reached that conclusion the I.R.C. first of all gave moral support to Kent, and then backed up its actions with public money. Should it have done so? There is no doubt that the intervention of the I.R.C. was crucial. It won the day. I think that it was right to do so, if only because the I.R.C. was set up to do exactly this kind of thing. It was established to intervene, and this was intervention. In this respect I was a little depressed by the speech of the right hon. Member for Leeds, North-East, because when I first entered the House he seemed to be a very forward-looking Minister of Housing and Local Government, with all the elements of the planner about him.
He has reverted to being a fairly ruthless kind of marketeer, and I am depressed and sorry to see that he is leaning so heavily on market forces. Incidentally, the hon. Member for Eastleigh (Mr. David Price), whom I much admire, and who hopes to speak later, went so far as to suggest during the Second Reading of the I.R.C. Bill, that the Government were pursuing the wrong means—means which he thought then were corruptive of the sort of market economy we wished to see in Britain. He will remember saying that I am sure. The whole point is that the operation of free market forces would in this case have produced the wrong answer, as it very often does. It would not have produced that merged company, a springboard, providing a basis for a developed industry, making it strong enough to face American competition.

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A Rank-Cambridge merger would have had two major defects. First, it would not have had a wide enough range over the instrument sphere; it would have covered a narrower range compared with the Kent-Cambridge merger which has taken place. Secondly, the manufacture of instruments is not central to Ranks. That firm regards it as a peripheral operation. It is an important and profitable part of its operations, no doubt, but it is only one operation among many and is, therefore, peripheral. This is not true of Kent. The centre and core of Kent's operation is the instrument sphere, and the centre and core of the new merged firm is exactly that.
Some people have objected to the element of public ownership involved in the I.R.C. shareholding. I do not object, but welcome it. It seems that this is the best sort of public ownership; namely, the kind which is likely to be profitable and bring revenue to the public purse. Thus, the Opposition Motion is wrong and the I.R.C. action is right. By its intervention, the I.R.C. has obtained the right sort of merger for the future of the industry.
Nobody has criticised the type of intervention employed. Indeed, this intervention conforms to the take-over code and the new group is likely to be capable of fighting off American penetration of our market. For this reason I trust that hon. Members will support the I.R.C. and that the Motion will either be withdrawn or defeated.
6.2 p.m.
Mr. John Peyton: If anything could have persuaded me to vote for the Motion, it would have been some of the intemperate remarks of the right hon. Member for Belper (Mr. George Brown). In contrast, my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) opened the debate in a temperate speech and, as one would have expected, he was exceedingly fair.
My right hon. Friend said that the Motion implied no criticism of the I.R.C. Later, he said that not for a moment were we questioning the motives and good intentions of its members, whom he described as vigorous, intelligent and honourable. I endorse those sentiments, but the Motion does not. It is critical of the I.R.C. and for that reason I do not feel,
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much as I dislike disagreeing with my right hon. and hon. Friends, able to support the Motion. I do not sympathise with it because, by implication, it asks the Government to interfere with the activities of the I.R.C. This is my main criticism of the Motion. It is a clear case of kicking the frying pan instead of sacking the cook, and I need not go much further in the process of identifying the cook who I wish to see sacked.
There are four prime reasons why I cannot support the Motion. The first is because I do not believe that the record of the Corporation merits censure. I was one of those who regarded its initial establishment with some suspicion, but my views have been influenced not only by the stature of the men appointed to the Corporation but also by the Corporation's record of achievement. I endorse the remarks made by the Daily Telegraph on 6th July, when it said that the Corporation had already proved an effective catalyst in the normal, slow processes of change in many industries. I believe that such a desirable development as the B.M.C.-Leyland merger would not have taken place except for the good offices of the Corporation.
The second reason why I cannot support the Motion is that while, in regard to Kent, it may be that the I.R.C. is open to some criticism for not having been sufficiently open, and while I regret that taxpayers' money should be invested on such vague terms from the return point of view, I see no reason for challenging the judgment of the Corporation that the outcome achieved is the best one for British industry.
My third reason for dissenting from the Motion is that if we are—as we surely are under this Government—to have official intervention in industrial affairs, then the more remote it is from Government the better. I would rather have men whose records and achievements in industry are beyond challenge controlling such powers than Ministers controlling them. I do not wish to lambast Ministers in this debate, except to say that they are too inclined to act from a background of unblemished ignorance and considerable prejudice. One battle honour which the Corporation can claim to its credit is the delicate compliment paid to it by the Government in connection with the Industrial Expansion

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Bill. The Government said, in effect, "We cannot trust our own creature, which is acting in an alien way"—in that it was acting with common sense and wisdom—"We must, therefore, have power to act on our own."
The fourth reason for withholding my support from the Motion is that I regard the choice of such a subject by the Opposition at such a time as something worse than whimsical. There are so many subjects on which this grotesque and awful Administration should be censured that it seems that the Opposition are themselves guilty of lowering the level of the argument in seeking to debate the frying pan rather than the cook. The Opposition are, therefore, losing opportunities of challenging on vital matters an Administration who have shown themselves responsible for many of the ills which now disturb the nation.
6.7 p.m.
Mr. Eric Moonman: The speech of the hon. Member for Yeovil (Mr. Peyton) showed the seriousness with which some hon. Gentlemen opposite feel about the whole question of the rôle and function of the I.R.C. Apart from the hon. Gentleman's final observations, he appeared to be saying, in effect, that there is a serious purpose behind the I.R.C, that it is doing a good job and that we should suspend judgment for some time.
The hon. Gentleman's speech was in contrast to the theme adopted by previous speakers from the benches opposite. I was reminded by some of their remarks of a passage which appeared in the Final Report of the Committee on Industry and Trade, in 1929. It said:
"… 'the adequate equipment of British industrial works with adequate plant and machinery may be obstructed by the conservative habits of mind which prevent many employers from pursuing an energetic renewal of plant'"
While the I.R.C. is not specifically concerned with the renewal of plant, it is concerned with changing motivation and people's minds and with the restructuring of industry. It is a pity that in debates of this kind, which follow the pattern of the debate we had on the Industrial Expansion Bill, there is still no recognition by hon. Gentlemen opposite of the importance of trying to under-
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stand the problems of contemporary industry.
Two main objections have been raised by hon. Gentlemen opposite, both inside and outside the House, to I.R.C. intervention in industry. The first is the fact that the Corporation uses public money for its activities. This argument is a non-starter, because public money is used by all nationalised industries, in various ways and for various reasons, but Parliament and the Government control neither. As the Economist recently pointed out:
"This freedom has widespread consequences—including some of the structure of British industry."
If we are to bring some competitiveness and a thorough restructure to our industry we shall need a variety of ways of doing it. The concept of Government involvement in industry has not just happened in the last 10 or 15 years. It may be that because we now have a more articulate Government and industrial force the problem is seen more acutely, but the whole emphasis of Government involvement in industry goes back 70 or 80 years.
The logical consequence is for Governments to back up their ideas, which they have not always been prepared to do, and show sincerity in their beliefs by making money available; and one would expect support of that idea rather than criticism of it. While I had some reservations about the Industrial Expansion Act and the use of money in that connection, I hope that the Opposition can distinguish, as I have, between the two approaches. The hon. Member for Yeovil (Mr. Peyton) was able to show that there is an important difference in the way Governments can act.
The second objection runs rather on the lines that the shareholders in firms have had their interests overriden. That argument will not wash in the case of Kent-Cambridge Instruments, which has been the theme of this debate. The latter company was strongly influenced to accept the lower of two bids, but the fact is that without I.R.C. intervention the bidding would not have got as high as it did in any case. The George Kent shareholders might say that
"… their earnings have been diluted by the high price paid for Cambridge …"

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but they should blame their own board for that. If the Corporation was twisting their arm they certainly have not said so.
There is an impressive list of mergers, and of work done by the Corporation in the last 12 months; of co-operation with firms and advice given. These are not even mentioned in the report. That is how we would expect the Corporation to work—without mentioning everything it does. Nevertheless, the report is there, and it has been referred to. It is an impressive list of work done whether one takes the telecommunications industry survey, Rootes Motors, A.E.C.—Elliott-Automation, G.E.C.—A.E.I., Dun-ford and Elliott (Sheffield)—Hadfields, the paper and board industry survey, Coats Paton—West Riding Worsted and Woollen Mills, or the British Oxygen Company—Edwards High Vacuum International.
In the case of Coats Paton it hardly looks as though the shareholders had their interests overridden because, as the report says:
"Both companies … wish to acknowledge the interest of the Industrial Reorganisation Corporation in securing an increased measure of rationalisation in the industry and of that organisation's separate approach to both companies on the subject."
This action is a fairly serious indication of the way in which a number of companies have been able to approach the Corporation or be approached by it, and have acted on the advice given.
Let us look more closely at the Motion, and at the rôle of the Corporation. It has been referred to more than once, and particularly in what I suggest was a very fine speech by the right hon. Gentleman the Member for Belper (Mr. George Brown). The Motion states:
"That this House, while upholding the independence of the Industrial Reorganisation Corporation, deplores its action in intervening with public money on behalf of one bidder in a merger operation …"
It is an interesting and revealing form of words. On the one hand, we have the judicious use of the word "independence". On the other, the attack is towards one activity of I.R.C.—the Kent-Cambridge bid.
I shall give the Opposition the benefit of the doubt—and I hope that I am not being foolhardy in doing so—when I
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say that they are not wholly politically motivated in giving up some time on one of their Supply days for a debate on this subject. But if they are not politically motived, they are something else. It means that they simply do not know the facts of industrial management and industrial reorganisation.
In short, on this subject the Tory Party is schizo. The I.R.C. type of organisation meets the Tories' long accepted criteria—it is a commercially aggressive and efficient organisation, but that it is associated with and has been set up by Government is very difficult for them to accept. That it was set up by Socialists is even worse, and it is far too traumatic for them ever to understand.
What we have a right to expect from the hon. Member for Eastleigh (Mr. David Price) is that he will give us a little more insight into the Conservative Party conscience on this subject. We had some indication, and then a denial, of what the Conservative Party would do with the I.R.C. if returned to office. Frankly, I think that many of my hon. Friends and many hon. Members opposite were not clear about what a Conservative Government would do. That point wants clarification, not only for hon. Members but for many people outside the House who have shown interest in the subject.
An intelligent Opposition who lean so heavily on their business relationships and connections would have tackled the subject of I.R.C. rather differently. Here I disagree with the hon. Member for Yeovil, who said that there were other subjects of greater import. The I.R.C. is very important. The great pity is that we have taken only one very small part of its activities, and with this rather absurd wording of the Motion we have moved from what we should have been debating. I suggest that the issue should have been about the Corporation's long-term objectives. Its strategy, its rôle in the restructuring of industry are relevant and pertinent questions.
There are three areas of debate. The first is: should the I.R.C. hold on to the shares is acquires? When it was set up, the Government said that the Corporation would not act as a "holding" company. It has a modest share stake

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in Rootes, but, generally, it has avoided building up equity holdings in industrial companies. In the case of Kent-Cambridge, the profits of rationalisation will take a while to emerge. Will one of the I.R.C. directors act as a watchdog? This needs clarification. The "holding company "has an appeal which the I.R.I. structure in Italy has shown to be possible and successful.
Secondly, the Corporation is still hamstrung from going into industry and reorganising it. A very keen and enthusiastic executive who went to the Corporation with ideas about a particular industry would not be able to get a list of companies that would be willing to be taken over and merged into a substantial unit.
Thirdly, can the Corporation assist in the development of mergers across national boundaries in Europe? I realise that our own Government policy is evolved in European technological matters, but the Government should not be too humble tonight. They should say whether they believe that the Corporation has a rôle to play there. My right hon. Friend the Member for Belper referred to the fact that in a number of countries there is interest in the work of the I.R.C, and I believe that the way in which we look at the question of scientific and technological collaboration will not only depend on Government good will and desire, but also on the setting up of organisations and institutions like the I.R.C. so that they can move in quickly to the important work that needs to be done in industry in Europe.
I would urge both Front Benches, in their concluding speeches, to show that they have thought about these matters and understand what the I.R.C. is doing now—and is likely to do in the future.
6.19 p.m.
Mr. David Howell: I listened to the hon. Member for Billericay (Mr. Moonman) with care, and I agree with him in one respect. I believe that this debate, which is far too short, is important. It is concerned with questions of power and accountability which lie near to the heart of the free society and how it evolves, and relate closely to questions of freedom, competitiveness, enterprise and the strength and effectiveness of this country and the world. I
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believe that, far from being the peripheral issue that my hon. Friend the Member for Yeovil (Mr. Peyton) implied, it is absolutely central to the difficulties facing the country and the Government.
I go back to the analysis which the Secretary of State for Economic Affairs gave the rôle of I.R.C. as he saw it. I believe that analysis to be superficial and that this superficiality created the conditions in which the present difficulties and the present case have arisen. The I.R.C. is a new kind of public agency which lives on the horns of a dilemma. Those within the I.R.C. for various reasons have often argued vigorously that they are commercial and act commercially. They see nothing wrong in going to the market place and participating where some win and some lose.
That is the kind of background in which the Kent-Cambridge affair evolved. The I.R.C. went in and behaved like capitalists. It argued that it was doing so commercially on profitability criteria and behaving as a good commercial firm. This was understandable from its point of view in the absence of clear directives to the contrary. But the facts are that it is not so. The I.R.C. is not a commercial organisation but an instrument of Government. Whether it is a good or a bad instrument I shall argue shortly. The point is that I.R.C. exists because it is an instrument of government to bring about the rationalisation of industry, not to make money.
I listened with great care to the Secretary of State when he touched on the criteria by which the I.R.C. should intervene and talked about international competition. I believe some of my hon. Friends do not go along with this. But when there is foreign competition which is Government subsidised and backed by Government procurement policies based on national prestige reasons, there is little choice for this country if it wishes to retain certain industries but to intervene to obtain equally competitive conditions. To that extent, I personally go along with the view that the Government, through the I.R.C. or some other instrument, are entitled to adopt policies towards certain industries and to have particular objectives for certain industries. On the broader question of intervention allowed on the rather vague

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criterion of national efficiency this is more difficult and delicate. When we examine a particular case, such as the one we are discussing today the precise arguments sound very weak.
I now say a word on the question of the I.R.C. as an instrument to secure Government objectives towards certain industries, on its record, and the way in which it has evolved as an instrument. Its difficulties have been not so much in trying to achieve objectives as to persuade Government officials and other agencies inside the Government—many of whom have activities overlapping the objectives of the I.R.C.—to see sense.
It is on the question of co-ordination between the I.R.C. and other officials carrying out procurement policies—the D.E.A. and the D.E.P. and the Ministry of Technology—and the vast proliferation of instruments under this Government, that the real battle has had to be fought. It takes place behind closed doors with other officials and Ministers where efforts are made to persuade them not to pursue policies contrary to the overall rationalisation of a particular industry. I believe that the I.R.C, if properly brought into and co-ordinated within overall sensible Government policies to create industries which will be internationally competitive and will not be overwhelmed by foreign Government-supported competition, has a rôle to play, but it is a political, not a commercial, instrument. It should be seen honestly and straightforwardly as such. Because it is a political and not a commercial instrument it is naïve to claim that it should go into every situation on the argument that it should behave in a commercial way.
As my right hon. Friend the Member for Leeds, South (Sir K. Joseph) said, such an institution has to walk delicately, and in this case delicacy was certainly needed and it was lacking. That is why I go along with the Motion and argue that, while I.R.C. and its management have done well and could do well in future, yet with this background of lazy thinking by this Government about its proper rôle, and the Government's failure to grasp the real implications of this kind of new agency, in this case it has made a mistake.
6.25 p.m.
Mr. David Price: I am very conscious that this debate has been all too brief and the outcome will be immensely frustrating to hon. Members on both sides of the House who came with the intention of making a contribution and have not been able to do so. I would willingly give up my winding-up speech but that such a break with tradition I should find difficult to make, and I should like to clarify some of the points which have been made. Nevertheless, I, too, feel frustrated because I shall have to make my speech very much shorter. I should like to follow the interventions made by the hon. Member for Luton (Mr. Howie) and the hon. Member for Billericay (Mr. Moonman).
We can take comfort in the fact that this can be regarded as a continuing debate, for we debated the White Paper, we debated the Industrial Reorganisation Corporation Bill on Second Reading, in Committee and on Third Reading before the Corporation was set up. We had a debate on 1st February, 1967, on the Consolidated Fund Bill and now we have this short debate today. I have no doubt that we shall have others in the future on the key issue of the structure of British industry and how it should be changed. I hope that I shall be able to summarise certain of the facts in this case and that we shall agree on them across the House. I wish to make known some opinions on which I do not expect to get the same unanimity.
We are today talking mainly about the recent events of the Kent-Cambridge merger. The first fact is that this was a contested take-over. For the first time the I.R.C. has openly taken sides. In Mr. Charles Villier's happy phrase,
"we have put our money where our mouth is."
I wonder what action the I.R.C. would have taken if there had been two suitors for the hand of A.E.I. instead of one. Would it have intervened? This is one of the major issues in the debate. The I.R.C. decided that it knew better than the market mechanism and it used its large resources of public money to ensure that its view was successful. The right hon. Member for Belper (Mr. George Brown) thought this a good thing and I think it a bad thing.
The second fact is that Ranks, not the I.R.C. or for that matter Kents, was the

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catalyst for this restructuring of the industry. Ranks made its first public offer for Cambridge Instruments on 9th April, On 15th May, Kent announced the terms of its proposed offer, but the Rank offer on 9th April certainly triggered proceedings off. Would anything have happened if Ranks had not acted? From the days when the I.R.C. was in a state of gestation under the midwifery of the right hon. Gentleman, the I.R.C. had been looking at restructuring and possible mergers in the British scientific and industrial instruments fields, but nothing came out of that period of gestation until Ranks made its offer.
The third fact is, if the I.R.C. had not supported Kents, Ranks would have succeeded in its bid. It cost the I.R.C. nearly £6½ million of public money to support Kents against Ranks. The question I ask hon. Members opposite who believe that it was right for the I.R.C. to support its judgment in this manner, is whether, in terms of priorities at this moment, so certain are they that the I.R.C. was correct in its judgment—remember some structuring would have taken place if Ranks had gone through with its offer—this is a top priority for £6½ million of public money to be used to support this particular method of regrouping the scientific instruments industry against all the other calls on public expenditure at this time.
Mr. George Brown: I apologise for interrupting, but the hon. Member used the emotive phrase, "It cost the I.R.C.". The I.R.C. has invested £6½million—I take the hon. Member's word for the sum—which shows that the managing director expects it to sell at a thumping great profit in the 1970s. No other merchant bank or city institution would regard its investment as a cost. Why does the hon. Member use that term in relation to the I.R.C?
Mr. Price: I can give the right hon. Member two answers. I will go on to say whether this is a good investment, but he will agree with me that even if it is ultimately a profitable investment it is a current call on public money. In terms of the current cash flow it is competing for the use of that £6,500,000 in this first post-devaluation year of 1968 with other current calls on public money and he cannot gainsay that.
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The fourth fact is that no adequate reasons were given by the I.R.C. to either Ranks or the public for favouring Kents. Ranks played fair with the I.R.C, but the I.R.C. never played fair with Ranks. It did not tell Ranks why it preferred Kents to Ranks and nor did it make efforts to discover from Ranks what their corporate strategy would have been if the Taylor Hobson and Cambridge Instrument merger had gone through, and remember the Hilger Watts offer from Ranks was also pending.
On 16th June, the Observer, to which the right hon. Member for Belper paid some attention, said:
"Imagine how John Davies must feel. He was absolutely open with the I.R.C. in all the dealings prior to the bid for Cambridge, but now finds that the I.R.C. is using taxes he pays to help out a rival he has outpaced in the market place."
Only last Wednesday was the first time the public were given the I.R.C.'s justification for preferring Kents to Ranks, and it was a thin justification. What it amounted to was that the I.R.C. said, "We are the I.R.C. and we know best."
As my hon. Friend the Member for Horsham (Mr. Hordern) pointed out, the whole position of Taylor Hobson has been dismissed very lightly. Taylor Hobson is not an incompetent company, as has been acknowledged by the Government, because in each of the last three years Taylor Hobson has been awarded the Queen's Award for Industry-, which does not suggest that it is precisely the slouch which the defenders of the I.R.C. have been suggesting.
The industrial logic which was the basis of the Secretary of State's speech is not at all clear to me. The I.R.C. claims that the Kent-Cambridge merger will provide a broad-based company covering industrial and scientific instruments and therefore capable of competing with American giants. On the other hand, Ranks takes the view that the best merger was that of the scientific instrument companies—Taylor Hobson, Cambridge and Hilger and Watts—without the added diversification into industrial products.
I understand the argument of the hon. Member for Luton, but the plain fact is that, on the information available, one can argue the case both ways. I put it to the hon. Member for Luton and to

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the Parliamentary Secretary that there are some questions which anyone would be asking if he were one of the parties to this sort of merger and were considering it. He would ask, "Am I buying products or market? Am I eliminating competition? Am I safeguarding a source of supply? Am I safeguarding a market for my existing or future range of products? Am I buying management? Am I buying technology? Am I buying as a defensive strategy to stop my competitor from increasing his strength? Am I buying into a different market or technology as a specific and well-thought-out policy of diversification?" I hope that the right hon. Gentleman has observed that the questions begin "Am I buying", not, "Am I forming a judgment about what other people ought to do?".
Having answered those questions, there are two other rules for mergers to bear in mind. The first is that one ought not to go into a merger without knowing one's maximum price exactly and one ought not to be lured beyond it, which is what happened to Kents. Secondly, one ought to have an outline integration plan prepared in advance, because if one's merger is to succeed, integration must be total. Nothing fails like the merger of two equal partners one, or both, of whom still wants to remain a separate business, but with a bit more security added. Those are the sorts of questions which ought to be asked. Nothing that the I.R.C. has published has convinced me one way or the other and I shall not be convinced today in the absence of answers to those questions.
I hope that the House recognises that four companies have been under discussion—Cambridge Instruments, Taylor Hobson, Kents and Hilger and Watts. I hope that the House appreciates that there are at least 14 combinations of merger and restructuring. There could be a merger of all four; there could be a merger of any three leaving out the fourth; there could be two mergers of any two and one merger of any group of two leaving out the other two companies on their own. That makes a possibility of 14 combinations. Why do the Government think that the I.R.C. is so competent to judge among those 14 alternatives so as to know what is best
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for British industry better than the market does?
The right hon. Gentleman quoted prolifically from the weekend Press. I quote from the Sunday Telegraph of yesterday, which said:
"How does one know who to back? The Restrictive Practices Court, with its staff and its judges, the Monopolies Commission with its Q.C.s and experts, both make very heavy weather of industrial judgments.
The idea of the Board of the I.R.C, largely busy business men acting part-time, being able to sit as a tribunal of judgment makes me laugh."
Those who hold that the I.R.C. is competent to judge must remember that this judgment involves the use of £6,500,000 of public money. What we challenge—and I know that the right hon. Gentleman accepts this, because this is what the argument is about—is the whole theory of the I.R.C. as an active interventionist body and we challenge that theory—
Mr. George Brown Mr. George Brown rose—
Mr. Price: I have given way once to the right hon. Gentleman. The Parliamentary Secretary must have time to reply and I do not have time to give way again. We challenge the theory that the Board of the I.R.C. knows what is best for British industry.
Mr. George Brown Mr. George Brown rose—
Mr. Price: The next fact is the question of the legality of the I.R.C.'s action. Let us make it clear that that is not in question, because of the very wide powers which the Government gave the I.R.C. in the Act and which we bitterly opposed in Standing Committee.
The sixth fact is that the I.R.C. has said that it follows its mouth with its money. This has involved the I.R.C. in open market operations in support of Kents against Ranks and it has involved the use of public money in support of one contender against another.
Mr. George Brown Mr. George Brown rose—
Mr. Price: I know that the right hon. Gentleman knows little about patience, but I hope that he will wait patiently for a little longer.
As Mr. Villiers has said, the I.R.C. is a new organisation; "there is nothing like it elsewhere and new organisations

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do new things". What has it done? It has used the taxpayers' money to favour one bidder against another, and, in an economic sense, the I.R.C. is an irresponsible organisation.
Mr. George Brown: Nonsense.
Mr. Price: Of course, it is legally—
Mr. George Brown Mr. George Brown rose—
Mr. Speaker: Order. We are working against time.
Mr. Price: Of course—
Mr. George Brown Mr. George Brown rose—
Mr. Speaker: Order. The hon. Gentleman has not given way, so the right hon. Gentleman must resume his seat.
Mr. Price: Of course, the I.R.C. is legally responsible for not misusing the money entrusted to it and nobody suggests that it would be otherwise, but when it puts its money where its mouth is, its action is not comparable to that of a merchant banker or industrial firm following the same injunction, and I will tell the right hon. Member for Belper precisely why not. It is because its money is at risk—
Mr. George Brown Mr. George Brown rose—
Mr. Speaker: It is for an hon. Member to decide whether to give way.
Mr. Price: I have undertaken to give the Parliamentary Secretary time to reply. If the Parliamentary Secretary will give up his time, I will willingly give way to the right hon. Gentleman.
The money of an industrial firm or merchant bank is at risk in two ways—loss of investment and failure to earn. Failure to earn is of no relevance to the I.R.C, because it has no statutory duty to make a profit. Loss of capital might be mildly embarrassing, but it would not have the same significance as for a merchant bank or an industrial company. Therefore the I.R.C. is in a position to back its judgment against a. competitor without the financial disciplines to which its competitor is subject.
I have three points to make about the future. The I.R.C. has now made its position clear—it knows best what is best for British industry. Right hon. and hon. Members opposite agree with that
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view. We on this side do not, and increasingly the country will come to agree with us about it. Second, no company can now trust the I.R.C. implicitly. It can no longer trust it because the I.R.C. has ceased to be a catalyst and become a judge, and trust, I remind the House, was one of the original ground rules for its existence. Third, no company can now proceed with a bid without fear that a counter-bid will be supported by the I.R.C, with the knowledge that the I.R.C. has virtually unlimited resources behind it and is bound to win.
The action of the I.R.C. over Cambridge Instruments has given a particular meaning to the penultimate paragraph of its first annual Report:
"The hope is that nationalisation can be by agreement, but if this provies impossible, the I.R.C. will not flinch from exercising its collective business judgment in supporting positive action."
As we have seen in the Kent-Cambridge case, supporting positive action means, "Heads I win, tails you lose". No doubt, such an attitude is entirely in tune with the Prime Minister's philosophy of politics, but it is in a very different key from the dulcet tones of the Financial Secretary to the Treasury when he replied to the last debate which we had on the I.R.C.
On 1st February, 1967, the hon. Gentleman said, about the I.R.C.:
"The Corporation competes with nobody. It threatens nobody. It compels nobody. It offers its connections, knowledge, advice and access to information to serve the purposes which I have outlined. There is no compulsion in its working. All this talk of threats or anything of that kind is quite beside the point."—[OFFICIAL REPORT, 1st February 1967; Vol. 740, c. 659.]
The Financial Secretary's speech stands in absolute contrast to the new behaviour of the I.R.C, and our Motion today stands on his evidence.
6.41 p.m.
The Joint Parliamentary Secretary to the Ministry of Technology (Dr. Jeremy Bray): We shall have to read HANSARD carefully tomorrow to find out exactly what the Opposition think about the I.R.C. We had one view from the right hon. Member for Leeds, North-East (Sir K. Joseph), another from the hon. Member for Yeovil (Mr. Peyton), and yet a third from the hon. Member for Eastleigh (Mr. David Price), the second Opposition Front Bench speaker.

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In considering the Motion, the first question is whether the I.R.C. was right to intervene in the way it did in the Kent -Cambridge merger. The I.R.C. had a strong technical argument for supporting the Kent-Cambridge merger in preference to the Rank-Cambridge merger.
The instrument industry in the United Kingdom has suffered from excessive fragmentation, with firms unable to maintain the research and development, marketing or technical service effort needed to make a sufficiently powerful impact in the home and export markets. At the same time, it is an industry which depends pre-eminently on the skill and professionalism of its staff. Questions of structure and control, therefore, are necessarily delicate matters. They have to be handled carefully. It is not unknown for a company to acquire the shell of a company and to find that it has lost all its staff.
We see in the nucleonic instrument sector a good example of how, I am sure, hon. Members on both sides would like to be able to proceed, if possible, in every case. Here, by agreement, Nuclear Enterprises, a small progressive Scottish firm founded by a nuclear physicist, was able to acquire the activities of E.M.I. and Elliott in the nucleonic instrument field with the help of an I.R.C. loan, thus setting up an independent and powerful nucleonic instrument company with the resources needed for growth and competition in world markets.
Elsewhere in the instrument field, however, progress has been disappointing. Efforts to bring about a grouping of several of the major scientific instrument companies, including Cambridge, did not produce results. So the reaction of both Mintech and the I.R.C. to the initial Rank bid for Cambridge Instruments was far from hostile. Any company has to be taken seriously if it is able to show the technical and commercial success of Rank Xerox and Rank/Taylor Hobson in their different fields. However, the board of Cambridge Instruments strongly opposed the bid from Rank and held discussions with Kent which resulted in the agreed bid from Kent. The I.R.C., with Mintech knowledge and agreement, then attempted to arrange a compromise by bringing together Kent, Cambridge and Rank/ Taylor Hobson, and eventually other instrument companies, too, into one group
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wholly concerned with instruments. But this was not acceptable to Rank.
At this stage, it was open to the I.R.C. to support Kent and disappoint Rank, to support Rank and disappoint Kent and Cambridge, or to drop out altogether, which would amount to leaving the field to Rank with its greater financial resources. Obviously, the matter needed very careful consideration against the background of the state of the industry as a whole.
The instrument industry covers a diverse range of activities. At one end, the products include industrial control instruments which have to be rugged enough to work continuously, with very high reliability, in industrial conditions of vibration, corrosion, dust and extremes of ambient temperature in the general rough and tumble of a factory. At the other end of the scale, it includes scientific instruments which may be switched on for only a few minutes a day, instruments working in laboratory conditions and involving a totally different kind of technology in their creation. The techniques used in both industrial instruments and scientific instruments span optics, precision engineering, electronics and physical chemistry.
The state of the instrument industry reflects Britain's past emphasis on pure research rather than industrial application, a bias which we are now trying to correct by many different policies of this Government. Britain's scientific instrument effort has been a good deal stronger than its industrial instrument effort. It is absolute bunk, if I may so put it, to suggest that the industrial instrument sector is declining, contracting or in any way likely to be a failing industry in the future.
Mr. Hordern: Will the hon. Gentleman refer to the George Kent report, which itself refers to the slow growth of the industrial instrument industry as compared with the scientific instrument industry?
Dr. Bray: Yes, and I shall refer to figures in a moment, if the hon. Gentleman will be patient.
Perhaps the most significant indicator is not just domestic production but the trade figures. With all the difficulties of the classifications—I freely acknowledge that we often do not know exactly what the Overseas Trade Accounts mean—one

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can say that for instruments in Class 861.97, that is, the more conventional measurement and control instruments, imports rose between 1964 and 1967 by 89 per cent. and exports, though rising, rose by only 21 per cent., a story which is all too common in a wide range of engineering products. But this does not mean that we can contract out of the whole field of engineering in which this sort of thing happens.
On the other hand, for the far more complex analytical and other instruments—Class 861.98—imports fell between those same years by 8 per cent., but exports rose by 78 per cent. That is a splendid trade performance by any standards. It is almost unique among engineering products., and paralleled only by other advanced products, as in the recent trend in computers.
Our industrial strategy as a nation, therefore, not only on instruments but generally must be to bring advanced products and techniques more closely to the support of our basic and still much larger engineering activities.
Cambridge offers in the range of techniques which it employs precision engineering and electronic capabilities in the medical and scientific instrument and the industrial control fields. Kent offers precision engineering and electronics and total systems capabilities mainly in the industrial process control field.
There are clearly mutual advantages to Kent and Cambridge in having outlets in the industrial instruments field for new developments coming from the scientific instrument industry. Rank had no such use for Cambridge. Rank Taylor Hobson are not in the industrial control sector to any significant extent, but they offer optics and the highest precision engineering capabilities in lens manufacture and design and dimensional measuring equipment, in which they are pre-eminent. However, it is a completely different area from industrial process control, in which both Kent and Cambridge are active.
There is no substantial industrial process instrument activity within Rank. Rank has been investing its very substantial earnings from Xerox—for which it is licensed wholly from the United States as far as technology goes—with varying success in a very wide range of
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activities, including bingo halls, bowling alleys and motor ports, as well as industrial equipment; and there is nothing wrong with that. In industrial process control it would be virtually starting from scratch. By contrast, Kent has concentrated all along on instruments and stands or falls by operating profitably and maintaining technical superiority over their competitors in the instrument industry.
Against this background it is difficult to fault the argument of I.R.C. as to where the industrial logic and the national interest lay. As I understand Opposition speakers, they have not denied the force of the industrial argument. The right hon. Member for Leeds, North-East spoke of a possible Rank-Cambridge merger as if it might have been a second best, and he questioned whether it might not be better to accept a second best in this respect. In other words, the Opposition have questioned the industrial case but they have not denied it, and they freely accept that it could well be sound.
They question it for two reasons. First, because Rank disagreed, and it was for Rank to consider whether Cambridge would have been a profitable investment for them at the price which they offered. I would not dispute that the judgment that Rank made could well have resulted in a better use of our national assets than had previously been the case, and I readily concede this to the hon. Member for Horsham (Mr. Hordern), but that still need not make it as good a solution as the Kent-Cambridge merger. The Opposition are perhaps being a trifle idealistic if they expect the voice of reason instantly to command universal assent where it conflicts with the short-term interests of some of the parties involved.
The second argument of the Opposition is that the market would have shown who was right in its own good time—in the long run, when as Keynes said, we are all dead. Such masochistic pursuit of the purest Tory doctrine speaks well for the consistency of hon. Gentlemen opposite, but not well for their good sense and sense of priorities for the country in the position it faces and the needs of industry today.
The next opposition argument is that even if the right solution has been arrived at this time, it constitutes a

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dangerous precedent for the future. That is the hoary old argument that if right is done this time right may have to be done next time too. But, they argue, even with all the advice in the world from a wide range of people to whom they talk in private industry as well as in Government and research establishments, the I.R.C. is still not infallible. It will certainly make mistakes sometimes if it bids against other bidders.
We are all human, even the I.R.C., and I would be very sorry if, after a number of years, I could feel that it had never made a mistake, because it would mean that those at the top had gone to sleep. It must be that I.R.C. could err, and it is inherently more likely that it will make a mistake in the quiet of an uncontested takeover than under the arc lights of a contested one. If hon. Gentlemen opposite are anxious to see the I.R.C. maintaining penetrating standards of assessment, then they should welcome the entrance of I.R.C. into contested takeover bids, when it would have to argue its case and convince shareholders as well as the management of companies.
Opposition hon. Members have made the point, as have some sections of the Press, that if I.R.C. enters into a contested takeover bid it will forfeit the confidence of firms which have previously been prepared to confide in I.R.C. and open their books to the Corporation. There is no evidence whatsoever of this happening, either with firms who are already engaged in discussions with I.R.C., or with firms who are making fresh contacts with I.R.C. The House has heard this afternoon of the fishing industry. Only last week a firm which was anxious to talk was passed on to the I.R.C. from Mintech. There is no evidence, I repeat, that there is any failing or diminution of confidence. Indeed, in so far as there is any reaction, the effect of the Kent-Cambridge deal seems to have been to consolidate the view that I.R.C. is to be taken seriously as pursuing a constructive rôle in British industry.
I believe it was the hon. Member for Horsham who asked about the terms on which the I.R.C. can borrow. If he will read the I.R.C. Report and accounts he will find the terms fully set out there;
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it is broadly at the Government borrowing rate.
Other hon. Members, and particularly the hon. Member for Bodmin (Mr. Bessell), argued that the I.R.C. should justify its interventions, giving a reasoned case for its view, before backing it with public money. The I.R.C. has already gone a great deal beyond the usual practice in the City in this respect. It has not been exactly reticent, but I am sure that it will note the point that hon. Members have made and do its best to conform.
When it comes to public agencies handing out funds to private industry, the Opposition struggle valiantly to overcome their scruples about Government intervention. So long as they could regard I.R.C. as a placid milch cow they were ready, though somewhat surprised, to smile on its ruminations; but it never was a milch cow; it has a serious task to do and it is doing it energetically.
Perhaps the strongest reason for rejecting the Opposition Motion is not that it is doctrinaire, not that it is less than scrupulous in failing to seek value for public money, but in that the Motion is complacent. The Opposition when, in power, left this country in a state—and I quote from the recent report by the Brookings Institution—in which, by 1962, productivity in United Kingdom industry was already 14 per cent., below that of France, 12 per cent. below that of Germany, and 5 per cent. below that of the Netherlands and even below Italy. I hope that hon. Gentlemen opposite will read that report.
There is a need for action, and for urgent action. The instrument industry cannot wait while the Opposition overcomes another lot of scruples. We have heard from the speeches of hon. Gentlemen this afternoon the great diversity of view that exists on the Opposition benches about the activities of I.R.C. Meanwhile, the House cannot accept an inhibition on the long overdue and energetic work of the Industrial Reorganisation Corporation and, therefore, I invite the House to reject the Motion.
Question put:—
That this House, while upholding the independence of the Industrial Reorganisation Corporation, deplores its action in intervening with public money on behalf of one bidder in a merger operation, and regards such action as a dangerous precedent for the future.
The house divided: Ayes 233, Noes 307.

Division No. 269]

AYES

[7.0 p.m.

Alison, Michael (Barkston Ash)

Gower, Raymond

Nicholls, Sir Harmar

Allason, James (Hemel Hempstead)

Grant, Anthony

Noble, Rt. Hn. Michael

Astor, John

Grant-Ferris, R.

Nott, John

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

Gresham Cooke, R.

Onslow, Cranley

Awdry, Daniel

Grieve, Percy

Orr, Capt. L. P. S.

Baker, Kenneth (Acton)

Griffiths, Eldon (Bury St. Edmunds)

Orr-Ewing, Sir Ian

Baker, W. H. K. (Banff)

Gurden, Harold

Osborn, John (Hallam)

Balniel, Lord

Hall, John (Wycombe)

Osborne, Sir Cyril (Louth)

Barber, Rt. Hn. Anthony

Hall-Davis, A. G. F.

Page, Graham (Crosby)

Batsford, Brian

Hamilton, Lord (Fermanagh)

Pearson, Sir Frank (Clitheroe)

Beamish, Col. Sir Tufton

Hamilton, Michael (Salisbury)

Peel, John

Bell, Ronald

Harris, Frederic (Croydon, N.W.)

Percival, Ian

Bennett, Sir Frederic (Torquay)

Harrison, Brian (Maldon)

Pike, Miss Mervyn

Berry, Hn. Anthony

Harrison, Col. Sir Harwood (Eye)

Pink, R. Bonner

Biffen, John

Harvey, Sir Arthur Vere

Pounder, Rafton

Biggs-Davison, John

Hastings, Stephen

Powell, Rt. Hn. J. Enoch

Birch, Rt. Hn. Nigel

Heald, Rt. Hn. Sir Lionel

Price, David (Eastleigh)

Black, Sir Cyril

Heath, Rt. Hn. Edward

Prior J. M. L

Blaker, Peter

Heseltine, Michael

Pym, Francis

Boardman, Tom (Leicester, S.W.)

Higgins, Terence L.

Quennell, Miss J. M.

Body, Richard

Hiley, Joseph

Ramsden, Rt. Hn. James

Bossom, Sir Clive

Hill, J. E. B.

Rawlinson, Rt. Hn. Sir Peter

Boyle, Rt. Hn. Sir Edward

Hirst, Geoffrey

Rees-Davies, W. R.

Braine, Bernard

Hogg, Rt. Hn. Quintin

Renton, Rt. Hn. Sir David

Brewis, John

Holland, Philip

Rhys Williams, Sir Brandon

Brinton, Sir Tatton

Hordern, Peter

Ridley, Hn. Nicholas

Bromley-Davenport, Lt.-Col. Sir Walter

Hornby, Richard

Rippon, Rt. Hn. Geoffrey

Brown, Sir Edward (Bath)

Howell, David (Guildford)

Robson Brown, Sir William

Bruce-Gardyne, J.

Hunt, John

Rodgers, Sir John (Sevenoaks)

Bryan, Paul

Hutchison, Michael Clark

Rossi, Hugh (Hornsey)

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

Iremonger, T.L

Royle, Anthony

Buck, Anthony (Colchester)

Irvine, Brynant Godman (Rye)

Russell, Sir Ronald

Bullus, Sir Eric

Jenkin, Patrick (Woodford)

St. John-Steavas, Norman

Campbell, B. (Oldham, W)

Jennings, J. C. (Burton)

Sandys, Rt. Hn. D.

Campbell, Gordon (Moray & Nairn)

Jopling, Michael

Scott, Nicholas

Carlisle, Mark

Joseph, Rt. Hn. Sir Keith

Scott-Hopkins, James

Carr, Rt. Hn. Robert

Kaberry, Sir Donald

Sharples, Richard

Channon, H.P.G.

Kerby, Capt. Henry

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

Chichester-Clark, R.

Kershaw, Anthony

Silvester, Frederick

Clark, Henry

Kimball, Marcus

Sinclair, Sir George

Clegg, Walter

King, Evelyn (Dorset, S.)

Smith, Dudley (W'wick & L'mington)

Cooke, Robert

Kirk, Peter

Smith, John (London & W'minster)

Cooper-Key, Sir Neil

Kitson, Timothy

Speed, Keith

Cordle, John

Knight, Mrs. Jill

Stainton, Keith

Corfield, F.V.

Lambton, Viscount

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

Costain, A.P.

Lancaster, Col. C.G.

Summers, Sir Spencer

Craddock, Sir Beresaford (Spelthorne)

Lane, David

Tapsell, Peter

Crosthwaite-Eyre, Sir Oliver

Langford-Holt, Sir John

Taylor, Sir Charles (Eastbourne)

Crouch, David

Lewis, Kenneth (Ruthland)

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

Crowder, F. P.

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

Taylor, Frank (Moss side)

Cunningham, Sir Knox

Lloyd, Ian (P'tsm-th, Langstone)

Teeling, Sir William

Currie, G. B. H.

Lloyd, Rt. Hn. Selwyn (Wirral)

Temple, John M.

Dance, James

Longden, Gilbert

Thatcher, Mrs. Margaret

d-Avigdor-Goldsmid, Sir Henry

Loveys, W.H.

Tilney, John

Dean, Paul (Somerset, N.)

McAdden, Sir Stephen

Turton, Rt. Hn. R. H.

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

MacArthru, Ian

van Straubenzee, W. R.

Digby, Simon Wingfield

Maclean, Sir Fitzory

Vaughan-Morgan, Rt. Hn. Sir John

Dodds-Parker, Douglas

Macleod, Rt. Hn. Iain

Vickers, Dame Joan

Donnelly, Desmond

McMaster, Stanley

Waddington. David

Coughty, Charles

Macmillan, Maurice (Farnham)

Walker,Peter (Worcester)

Doughty, G.B.

Maddan, Martin

Walker-Smith, Rt. Hn. Sir Derek

du Cann, Rt. Hn. Edward

Maginnis, John E.

Wall, Patrick

Elliot, Capt. Walter (Carshatton)

Marples, Rt. Hn. Ernest

Waters, Dennis

Emery, Peter

Marten, Neil

Ward, Dame Irene

Errington, Sir Eric

Maude, Angus

Weatherill, Bernard

Farr, John

Maulding, Rt. Hn. Reginald

Wells, John (Maidstone)

Fisher, Nigel

Mawby, Ray

Whitelaw Rt Hn William

Fletcher-Cooke, Charles

Mills, Stratton (Belfast, N.)

Williams, donald (Dudley)

Fortescue, Tim

Miscampbell, Norman

Wills, Sir Gerald (Bridgwater)

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

Mitchell, David (Basingstoke)

Wilsaon, Geoffrey (Truro)

Galbraith, Hn. T.G.

Monro, Hector

Wolrige-Gordon, Patrick

Gibson-Watt, David

Montgomery, Fergus

Wood, Rt. Hn. Richard

Giles, Rear-Adm. Morgan

More, Jasper

Woodnutt, Mark

Gilmour, Ian (Norfolk, C.)

Morrison, Charles (Devizes)

Worsley, Marcus

Glover, Sir Douglas

Mott-Radclyffe, Sir Charles

Younger, Hn. George

Glyn, Sir Richard

Munro-Lucas-Tooth, sir Hugh

Godber, Rt. Hn. J. B.

Murton, Oscar

TELLERS FOR THE AYES:

Goodhart, Philip

Nabarro, Sir Gerald

Mr. R.W. Elliott and

Goodhew, Victor

Neave, Airey

Mr. Reginald Eyre.

118

119

NOES

Abse, Leo

Fernyhough, E.

Luard, Evan

Albu, Austen

Fitch, Alan (Wigan)

Lyon, Alexander W. (York)

Allan, Frank (Salford, E.)

Flectcher, Raymond (Ilkeston)

Lyons, Edward (Bradford, E.)

Alldritt, Walter

Flectcher, Ted (Darlington)

McBridge, Neil

Anderson, Donald

Fooley, Maurics

McCann, John

Archer, Peter

Foot, Rt. Hn. Sir Dingle (Ipswich)

MacColl, James

Atkinson, Ronald (Preston, N.)

Foot, Micheal (Ebbw Vale)

MacDermot, Naill

Atkinson, Norman (Tottenham)

Ford, Ben

Macdonald, A. H.

Bacon, Rt. Hn. Alice

Forrester, John

McKay, Mrs. Margaret

Bagier, Gordon A. T.

Fowler, Gerry

Mackenzie, Gregor (Rutherglen)

Barnes, Michael

Fraser, John (Norwood)

Mackie, John

Barnett, Joel

Freeson, Reginald

Mackintosh, John P.

Baxter, William

Galpern, Sir Myer

Maclennan, Robert

Beaney, Alan

Gardner, Tony

McMillan, Tom (Glasgow, C.)

Bence, Cyril

Garrett, W. E.

McNamara, J. Kevin

Benn, Rt. Hn. Anthony Wedgwood

Ginsburg, David

Mahon, Peter (Preston, S.)

Bennett, James (G'gow, Bridgeton)

Gordon Walker, Rt. Hn. P. C.

Mahon, Simon (Bootle)

Bessell, Peter

Gourlay, Harry

Mallalieu, E. L. (Brigg)

Bidwell, Sydney

Gray, Dr. Hugh (Yarmouth)

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

Binns, John

Greenwood, Rt. Hn. Anthony

Manuel, Archie

Bishop, E. S.

Gregory, Arnold

Marks, Kenneth

Blackburn, F.

Grey, Charles (Durham)

Marquand, David

Boardman, H. (Leigh)

Griffiths, David (Rother valley)

Marsh, Rt. Hn. Richard

Booth, Albert

Griffiths, Eddie (Brightside)

Mason, Rt. Hn. Roy

Boston, Terence

Griffiths, Rt. Hn. James (Llanelly)

Maxwell, Robert

Bottomley, Rt. Hn. Arthur

Griffiths, Will (Exchange)

Mayhew, Christopher

Boyden, James

Hamilton, James (Bothwell)

Mendelson, J. J.

Braddock, Mrs. E. M.

Hamling, William

Mikardo, Ian

Bradley, Tom

Hannan, William

Millan, Bruce

Bray, Dr. Jeremy

Harper, Joseph

Miller, Dr. M. S.

Broughton, Dr. A. D. D.

Harrison, Walter (Wakefield)

Milne, Edward (Blyth)

Brown, Rt. Hn. George (Belper)

Hart, Rt. Hn. Judith

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

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

Haseldine, Norman

Molloy, William

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

Hattersley, Roy

Moonman, Eric

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

Hazell, Bert

Morgan, Elystan (Cardiganshire)

Buchan, Norman

Healey, Rt. Hn. Denis

Morris, Alfred (Wythenshawe)

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

Heffer, Eric S.

Morris, Charles R. (Openshaw)

Butler, Herbert (Hackney, C.)

Henig, Stanley

Morris, John (Aberavon)

Butler, Mrs. Joyce (Wood Green)

Hilton, W. S.

Moyle, Roland

Callaghan, Rt. Hn. James

Hobden, Dennis (Brighton, K'town)

Mulley, Rt. Hn. Frederick

Cant, R. B.

Hooley, Frank

Murray, Albert

Carmichael, Neil

Horner, John

Neal, Harold

Carter-Jones, Lewis

Houghton, Rt. Hn. Douglas

Newens, Stan

Castle, Rt. Hn. Barbara

Howarth, Harry (Wellingborougn)

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

Chapman, Donald

Howarth, Robert (Bolton, E.)

Oakes, Gordon

Coe, Denis

Howell, Denis (Small Heath)

Ogden, Eric

Coleman, Donald

Howie, W.

O'Malley, Brian

Conlan, Bernard

Huckfield, Leslie

Oram, Albert E.

Corbet, Mrs. Freda

Hughes, Rt. Hn. Cledwyn (Anglesey)

Orme, Stanley

Crawshaw, Richard

Hughes, Emrys (Ayrshire, S.)

Oswald, Thomas

Cronin, John

Hughes, Hector (Aberdeen, N.)

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

Crosland, Rt. Hn. Anthony

Hughes, Roy (Newport)

Owen, Will (Morpeth)

Crossman, Rt. Hn. Richard

Hunter, Adam

Page, Derek (King's Lynn)

Cullen, Mrs. Alice

Hynd, John

Paget, R. T.

Dalyell, Tarn

Irvine, Sir Arthur (Edge Hill)

Palmer, Arthur

Darling, Rt. Hn. George

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

Pannell, Rt. Hn. Charles

Davidson, Arthur (Accrington)

Janner, Sir Barnett

Park, Trevor

Davies, Ednyfed Hudson (Conway)

Jay, Rt. Hn. Douglas

Parkin, Ben (Paddington, N.)

Davies, Dr. Ernest (Stretford)

Jeger, George (Goole)

Parkyn, Brian (Bedford)

Davies, Harold (Leek)

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

Pavitt, Laurence

Davies, S. O. (Merthyr)

Jenkins, Hugh (Putney)

Pearson, Arthur (Pontypridd)

Delargy, Hugh

Jenkins, Rt. Hn. Roy (Strechford)

Peart, Rt. Hn. Fred

Dell, Edmund

Johnson, James (K'ston-on-Hull, w)

Pentland, Norman

Dempsey, James

Jones, Dan (Burnley)

Perry, Ernest G. (Battersea, S.)

Dewar, Donald

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

Perry, George H. (Nottingham, S.)

Diamond, Rt. Hn. John

Jones, J. Idwal (Wrexham)

prcntice, Rt. Hn. R. E.

Dickens, James

Judd, Frank

pric,chriStopher (Perry Barr)

Dobson, Ray

Kelley, Richard

price, Thomas (Westhoughton)

Doig, Peter

Kenyon, Clifford

Prjce, William (Rugby)

Dunn, James A.

Kerr, Mrs. Anne (R'ter & Chatham)

Pursey, Cmdr. Harry

Dunnett, Jack

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

Randall, Harry

Dunwoody, Mrs. Gwyneth (Exeter)

Kerr, Russell (Feltham)

Rankin, John

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

Lawson, George

Rees, Mertyn

Eadie, Alex

Lee, Rt. Hn. Frederick (Newton)

Reynolds, Rt. Hn. G. W.

Edelman, Maurice

Lee, Rt. Hn. Jennie (Cannock)

Rhodes, Geoffrey

Edwards, William (Merioneth)

Lee, John (Reading)

Richard Ivor

Ellis, John

Lestor, Miss Joan

Roberts, Albert (Normanton)

English, Michael

Lever, Harold (Cheetham)

Roberts, Rt. Hn. Goronwy (C'narr'n)

Emals, David

Lever L. M. (Ardwick)

Roberts, Rt. Hn. Gwilym (Bedfordshire, S.)

Ensor, David

Lewer, Arthur (W. Ham, N.)

Robertson, John (Paisley)

Evans Albert (Islington, S.W.)

Lewis, Ron (Carlisle)

Robinson, Rt. Hn. Kenneth (St.P'c'a.)

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

Lipton, Marcus

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

Faulds, Andrew

Loams, Kenneth

Rodgers, William (Stockton)

120

121

Roebuck, Roy

Storehouse, Rt. Hn. John

Wells, William (Walsall, N.)

Rogers, George (Kensington, N.)

Strauss, Rt. Hn. G. R.

Whitaker, Ben

Rose, Paul

Summerskill, Hn. Or. Shirley

White, Mrs. Eirene

Ross, Rt. Hn. William

Swain, Thomas

Whitlock, William

Rowlands, E. (Cardiff, N.)

Swingler, Stephen

Wilkins, W. A.

Ryan, John

Taverne, Dick

Williams, Alan (Swansea, W.)

Shaw, Arnold (Ilford, S.)

Thomas, Rt. Hn. George

Williams, Alan Lee (Hornchurch)

Sheldon, Robert

Thomson, Rt. Hn. George

Williams, Clifford (Abertillery)

Shinwell, Rt. Hn. E.

Thornton, Ernest

Williams, W. T. (Warrington)

Shore, Rt. Hn. Peter (Stepney)

Tinn, James

Willis, Rt. Hn. George

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

Tuck, Raphael

Wilson, William (Coventry, S.)

Short, Mrs. Renée (W'hampton, N.E.)

Urwin, T. W.

Winnick, David

Silkin, Rt. Hn. John (Deptford)

Varley, Eric G.

Winstanley, Dr. M. P.

Silverman, Julius

Wainwright, Edwin (Dearne Valley)

Woof, Robert

Skeffington, Arthur

Wainwright, Richard (Colne Valley)

Wyatt, Woodrow

Slater, Joseph

Walden, Brian (All Saints)

Yates, Victor

Small, William

Walker, Harold (Doncaster)

Snow, Julian

Wallace, George

TELLERS FOR THE NOES:

Spriggs, Leslie

Watkins, David (Consett)

Mr. J. D. Concannon and

Steal, David (Roxburgh)

Weitzman, David

Mr. Ernest Armstrong.

Steele, Thomas (Dunbartonshire, W.)

Wellbeloved, James

BRISTOL CORPORATION BILL [Lords] (By Order)
Order for Second Reading read.
7.10 p.m.
Mr. Robert Cooke: I beg to move, That the Bill be now read a Second time.
Perhaps I should say at the outset that I believe that hon. Members will have received copies of a statement in favour of the Bill from the promoters and that I have in my possession further copies. I also have copies of the report of the debate in Committee in another place, which contains much detailed discussion. This, too, is available to hon. Members. At the end of the discussion I should be prepared, if the House were to give me leave—I hope that no hon. Gentleman present would object—to reply on points of detail on behalf of the promoters, should occasion arise.
The Bill carries out the Minister of Transport's instructions to the Port of Bristol Authority given to the Authority at the time of the rejection by this Government of the Portbury scheme, which would have made Bristol the finest port in Europe. The Port of Bristol Authority was told to consult the National Ports Council and to bring forward proposals for the future modernisation and expansion of the Port of Bristol.
The Bill embodies the agreed proposals and has the support of the South West Economic Wanning Council, which endorsed Portbury and whose Chairman, incidentally, has only this weekend deplored the Government's continued obstruction of Bristol's legitimate aspirations to take its place in the region. The
122
Bill carries out the Minister's instructions. It is also born out of the continued frustration of the citizens of Bristol since 1964 at the hands of this Government, who have seemed to be reluctant to make up their minds and, when they do, only slowly.
The Bill has passed all its stages in the House of Lords. In offering it to the Commons I am authorised on behalf of the promoters to say that they will have included in the Bill a Clause to meet the only Government objection made in the Lords—incidentally, the House of Lords did not see fit to instruct the promoters to include a provision to this effect—and make the West Dock scheme subject to the control of the Minister of Transport under sections 9 and 10 of the Harbours Act, 1964. That, I believe, fully meets the objections of the Minister, other than that he saw fit last Friday to turn down the entire scheme.
Although the Minister has turned down the scheme now, if we were to get a Bill on to the Statute Book it could easily be amended to meet the needs of future years. One of the points which I am asked to make is that a Bill on the Statute Book would mean that, when the need arises for future development and expansion of the Port of Bristol, it can be proceeded with much more easily by amendment of the existing Statute than by beginning the whole process again.
Therefore, for that very reason, despite the Minister's request, we cannot agree to withdraw the Bill. In any case, we must press the Minister for a much more definite indication of what the future of the Port of Bristol is to be. If the Government must interfere, they have an obligation to help us plan our future.

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The West Dock authorised by the Bill would provide Bristol with the necessary works of renewal—I stress that word—and expansion which she must have or die. The Minister's letter received by many hon. Members this morning, and in any case published in the newspapers, envisages the rundown over 15 or 20 years of the Port of Bristol and the loss of jobs at the level of 6,500. This amounts to the virtual closure of the Port of Bristol at the end of that time.
Bristol has held a proud place as one of our major ports for 1,000 years. If that high-flown sentiment does not commend itself to hon. Members with rival claims, I would like them at least to consider that this is nothing to the fact that one in four of the citizens of Bristol now depend directly or indirectly on the prosperity of our port. It is difficult to see how during the course of the next 15 to 20 years the running down of the port would not have a very serious effect on the livelihood of all the citizens of the city which I am proud to represent.
The principal ground for the present rejection is that there would be an uneconomic return on the capital involved. This is debatable. The Minister says that it does not come up to the 8 per cent. test rate of return for such projects. One of my principal questions to the Minister—I will read it slowly so that he can write it down—is whether he can give us an example or other examples which come up to this standard. It would be very helpful if he could tell us that, because obviously, whatever happens today, we shall not be deterred from coming forward in the future with proposals and we would like to know just what our competition is and what the rules of play are.
The Minister has said that public money on the scale for which we are asking—we are not asking for public money; we are asking to spend £14¾ million—should not be committed on this project. We shall go to the market, not to the Treasury. I think that is worth the Minister's consideration. We shall not come bleating to the Treasury. We shall go and chance our arm in the market where projects are judged.
The Minister of Transport (Mr. Richard Marsh): The hon. Gentleman is saying that the Corporation would be pre-
124
pared to do without the Government's 20 per cent. grant?
Mr. Cooke: I was just coming on to that. I am so grateful to the Minister for leading me on to my next point. Will the Minister give his consent for our project without the grant? Will he authorise us to go ahead without the 20 per cent. grant? If he would care to answer that by an intervention now, I would be happy to give way to him. If he cannot do it now, perhaps he will answer it in his speech, as he specifically raised the question of the grant. I am asked to ask him on behalf of the promoters whether he would give us consent to go ahead with the project without the 20 per cent. grant for which we would be eligible.
It seems odd to us that the Brighton Marina for yachts, costing £11¾ million raised on the market and a £3½ million Government loan, should get the go-ahead and yet the lifeblood of the second city of the Kingdom is at risk because we cannot have our dock.
I know that many hon. Members wish to speak, but I must now deal with the Minister's letter of last Friday, which is public knowledge, and endeavour to answer some of his main points to which I have not already referred. He attempts to prove that there would be great additional costs over and above £14¾ million, that there would be additional costs to users of the new dock and that these should somehow be included in the cost of the project.
What about the income which we shall derive from those users? We have the 2,000 acres of land which the citizens of Bristol own. If users want to construct specialist facilities, that will produce income to us and it will not cost us anything. We will be providing them with the site. That point, therefore, is disposed of.
Then we come to the old bogy of the alleged insufficiency of committed traffic from the industrial areas. We have unrivalled communications for our proposed extension. The motorway network of the United Kingdom might almost have been designed to lead to the Port of Bristol, and our rail communication also is good. They are the cross-country routes which are to remain open in the rationalisation of the railways. We are within easy reach of London, South

125
Wales, the great industrial Midlands and the far South-West, too, if the Government would only get on with their road programme there.
In any event, the idea that industry has to be within a few miles of the port and that the port must not be built before one has obtained the industry is an old bogy. A businessman does not wait for a queue of people to form in the street before he decides to build and open a shop. He goes into the pros and cons and decides that it is worth opening a shop, and his customers appear if he has made the right decision.
The trouble about the present situation is that the Port of Bristol has too many customers and is unable to cope with the existing trade. The Minister seeks to make their position yet more difficult.
The question of the proximity of industry is contradicted in the Minister's recent letter. In any event, there has been a substantial change of ground from the reasons given for turning down the Portbury scheme. On the question of communications, one might point out that it is probably quicker to get from Slough to Avonmouth than it is to get from Slough to the London Docks. It certainly will be when the motorway is completed, and the Bristol-London route looks like being a reality before too long. There are no worth while plans for dealing with the hopeless congestion in the City of London.
The cost of berths is another query raised by the Minister. It is false to make a comparison with other schemes. We must have the entrance lock—which is to be 1,400 ft. long and to take ships of 140 ft. beam—in any case. It is unrealistic to transfer or apportion this to the cost of the berths. The more berths that are constructed, the less the cost would be as trade continued to grow.
The next question is that of importance to the south-western region. There are three principal planks in the policy outlined in the Tress Report: the Port of Bristol, improved regional communications and the key position of the Plymouth area and the dock there. I have the wholehearted support of all my hon. Friends from the South-West of England in urging on the Government those three chief planks in the policy outlined by the Tress Report.
126
We are told that the rate of growth of the Port of Bristol is less than in other places, but when one is working near to 100 per cent. capacity it is very difficult to grow. When one is in a run-down or stopped position, any activity counts for a big percentage increase. We have been fighting with one hand tied behind our backs, and now our right arm is to be cut off by the arbitrary action of the Minister.
We are told that our exports are small compared with imports. History is one of the reasons for this, but, also, we cannot do more exporting without the berths, and it is the berths for exporting which are provided for within the Bill.
In his letter, the Minister makes a big point of the future of the City Docks. The City Docks are the port from which John and Sebastian Cabot sailed to discover the New World. In this respect there is greater confusion of thought in the Minister's mind than in almost anything else. He must be pressed today to give us an indication of how we may get out of our difficulties. The City Docks are run at a loss, supported by Avon-mouth, the more modern port which the citizens constructed with their own moneys at the end of the last century and more recently.
We have this valuable site in the centre of the city, but we cannot close the City Docks. We cannot redevelop them to the advantage of all the citizens, because without the new West Dock we cannot fulfil our long-term contracts and obligations to the present users. One cannot simply close a dock when one has contracts which continue for many years. It is not possible to go into the existing docks of Avonmouth because there simply is not room. That is why we need our Bill and what is contained in it.
We are hamstrung in making progress in the matter by the Minister's decision of last Friday. The penultimate paragraph of his letter is somewhat sickening to us in Bristol in our present disillusion, but perhaps he can do something to extend some hope to us. While he hears his words again, I hope that he is thinking up some helpful suggestions.
The Minister says:
"The people of Bristol are proud of their port, and rightly so"—
we knew that already—
"and I hope that the changing pattern of traffic and advances in technology may in due

127
time make it possible to undertake further development of the port on an economic basis."
That is a long sentence without any punctuation, but the message is clear: the Minister hopes that we have a future. By his opposition to the Bill, however, by saying flatly last week that he had no intention of letting it pass and no intention of authorising our scheme, he has put the whole of our future in doubt.
The Minister hints that we must await the Severnside Study. But we waited for Tress, for the National Ports Council—twice—and we waited for a reply on the current matter which is under discussion. When the Prime Minister was last in Bristol, he said that we would know in three weeks. The three weeks expired on the Friday before Whitsun, but nothing has happened. Now, we have forced the issue by coming to the House and asking for a Second Reading of the Bill. On the last sitting day before today, the date for Second Reading, we were told in answer to a Written Question on Friday morning that the Minister was out to stop us.
We are entitled to an answer to my specific questions which I have raised and to others which will be put by my hon. Friends. We have a Government who believe in planning, but so far there has been no helpful action as a result of that planning or the lack of it. The Minister says that the Port of Bristol cannot stand still but must either develop or decline.
Mr. W. A. Wilkins: Hear, hear.
Mr. Cooke: I am glad to have that "Hear, hear" from the hon. Member, to whom I might refer tonight as my hon. Friend. Friends, I hope, we always will be in the interests of the future of the city and the dock that we all care about.
All the Bristol Members—indeed, the whole of the West Country—cannot accept the present state of affairs, and certainly cannot accept the decline of the Port of Bristol. So we must know more from the Minister this evening. If the Government must interfere, the Government have a duty to tell us how we can progress. We cannot play our full part in the nation's economic life or in that of the region without a secure future
128
for our port. If this debate does nothing more, it will give an opportunity to the Minister to tell us what he can do to help our future, and I hope to heaven he can help us this evening.
7.30 p.m.
Mr. E. Rowlands: I should like, in making my own speech, to follow many of the points which the hon. Member for Bristol, West (Mr. Robert Cooke) made, but I would like to answer a question which he raised right at the beginning, although it is a little presumptuous of me because, the question was addressed to the Minister. He asked what other approved schemes had shown a return of 8 per cent. or more on investment. If he had looked at the evidence given to the Select Committee in another place he would not have to look far for his answer. The north side at Newport showed a d.c.f. return of 9 per cent. and a roll-on-roll-off at Swansea of 10 per cent. As the dock manager pointed out, approval would not have been given if the investment had not been capable of showing a return of 10 per cent. I think that that answers the specific point which the hon. Member raised at the very beginning.
It is very sad that when we debate these issues we find ourselves fighting against one another. They put colleague against colleague and city against city and region against region. We find ourselves engaged in a cut-throat competition and a slanging match between one side of the Bristol Channel and the other. What we all want is co-operation and what we all want is rationalisation of all the resources to secure a maximum return for both sides of the Channel and both regions. We want co-operation and rationalisation on a basis which will stand up to the test of hard economic and financial assessments as opposed to emotion.
What are the financial and economic facts of the scheme put before us this evening? The Bill we are asked to endorse is for a £15 million scheme and the most optimistic assessment of the return on this investment is 6 per cent. It is much more likely, the National Ports Council assessment shows, to be a return of between 2¾ per cent. and 4½ per cent. The Government have already laid down the minimum financial criterion by which to judge these schemes

129
and it is 8 per cent. Every recent investment in such schemes has had to conform to that criterion and has done so.
The promoters of the Bill have done something which is fast becoming what might be called financial assessment Bristol fashion. If an assessment does not suit them and they do not accept the criterion being used—it is what happened over Portbury—they make an optimistic assessment and, when faced with the hard economic facts of their proposals, they prefer to take a local hunch and tell us that they know that it will be a good scheme.
Mr. R. F. H. Dobson: Is my hon. Friend not aware that on at least one occasion during discussion of the scheme the Port of Bristol Authority figures were found to be correct and the Ministry's figures, upon being checked at the Ministry, were found to be incorrect?
Mr. Rowlands: Is my hon. Friend saying that the present scheme of £15 million will achieve the 8 per cent. criterion which is necessary and which is at the moment used to judge such an investment? If he is, perhaps he can argue that in his own speech. On the National Ports Council evidence—I agree it was not very good evidence—the figure is 2¾ per cent. to 4½ per cent., at the most optimistic, as the return on the investment.
Even so, even if we overlook this factor, how can we endorse a scheme which not only gives such a low return on such a large investment, but will have a disastrous effect on neighbouring ports? What we say that is, if we find that the nearby ports are capable of handling this trade, and if we find as we do, that in South Wales there is an enormous capacity to take up, why should those resources compete rather than complement the services of the ports in the Bristol region? That is, in fact, what would happen if this scheme went ahead. No doubt there might be quoted to us—I am pleased that the hon. Member for Bristol, West did not—the National Ports Council letter in which Sir Arthur Kirby set out the way in which the Bristol and South Wales ports were complementary rather than competitive.
That statement was rather simply put in the letter to the Minister and is one of
130
the inaccuracies in the information provided by the Ports Council, because an astonishing piece of evidence emerged in the evidence given to the Select Committee. It turned out that the National Ports Council did not even bother to give detailed figures or make any inquiry from the South Wales Dock Board about the different figures of different cargoes.
Had it done so it would have found that on the most cautious assessments which have been made the South Wales ports would lose about £1 million worth of trade per annum. It turned out that the National Ports Council conclusions could only be arrived at by evidence produced by Bristol.
Mr. Peter Walker: Does the hon. Member mean in pounds or tonnage?
Mr. Rowlands: In receipts, I gather.
The fact which emerged from the evidence, and I am sure that the hon. Member knows it, was that the evidence given of the pattern of trade in the South Wales ports showed that we are not as narrowly confined in the way we trade as we used to be but have diversified and have enormous excess capacity to develop. The hon. Member will find that some of our ports are working at only half capacity. It is the sort of trade for which Bristol would be competing with South Wales.
Mr. Peter Emery: Is the hon. Member really seriously attempting to argue that Cardiff will provide the necessary trading for the South-West? Because this is what so many of us want Bristol developed for. Surely there cannot be any argument that Cardiff will satisfy that?
Mr. Rowlands: To make this Bristol scheme justifiable will mean taking away from the South Wales ports on the other side of the Channel the type of trading which could equally well be developed there.
If the Bristol scheme is to have any chance of success it will compete with the South Wales ports. The regional argument is handled in the Minister's letter. I think that my right hon. Friend will deal with this matter himself, but if we look at the evidence given to the Select Committee we find that the type of trade to be expanded under the one dock

131
scheme is the type of trade being expanded in the South Wales ports. The South Wales ports have enormous spare capacity.
Therefore, not only do we find that the financial return expected on such an investment is so low, but also Bristol's losses can be reduced only by putting the South Wales ports into the red. This scheme reveals a plan which could bring real gain to the ports on both sides of the Channel and reveals the confusion which results from spasmodic reaction to piecemeal proposals.
The National Ports Council sometimes suffers from having to react to individual port applications. One has only to read Sir Arthur Kirby's letter to the Minister to realise how confused one can get in certain respects. He said initially:
"The Bristol scheme cannot be justified by any financial criteria."
Then we get something of an apologia on behalf of the Bristol Corporation. He ends with the understatement of the year when he says:
"I am sorry, but I cannot give you a clear-cut case. I realise only too well the difficulties which this recommendation leaves you with before you can arrive at a decision."
That is some sort of advice. I am sure that the Minister would say "Hear, hear" to that sort of advice. Having tendered that advice, he tries to discount it by saying that one cannot take this advice as really concrete or worth while.
I think that these occasions, when we debate the Bristol and the South Wales ports, are very sad indeed, because they tend to concentrate on the negative side on both sides. On the one hand, we get over-gloomy prognostications. We are told that this great and ancient port of Bristol will die if it has less than a £15 million scheme. We were told this about the Portbury scheme when we were asked for £27 million. I think that there is a slight element of blackmail and exaggeration in the remarks made by the hon. Member for Bristol, West.
I realise that the evidence given in Committee by Bristol people was to the same effect. But if one reads the evidence of the South Wales Docks Board manager about what happened in South Wales, we, too, thought that our ports were written off. We thought that there would never
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be a chance of a profit. But by selective investment where it was necessary and by rationalisation, every individual dock in South Wales has achieved a profit this year.
I do not want to appear partisan, but our side of the Channel is reacting to such developments as are contained in the Bill which has been presented today. We find ourselves equally on the defensive and protective of our own ports. As a result, one would not have thought that there was tremendous potentiality for all the ports on the Severn Estuary. The debate comes at a time when the most exciting prospects are being opened up on the Severn. Investigations have found that from Newport to Cardiff there are large areas capable of development adjacent to deep water ports. This was one of the top choice Maritime Industrial Development Area Sites—M.I.D.A.S. Another choice site was the area of land surrounding Bristol. Surely exploitation of these areas over a long period will provide tremendous prosperity in future for both regions.
Mr. Robert Cooke: The hon. Gentleman has talked about geography. Is he aware on which side of the Severn Estuary the deep water channel lies?
Mr. Rowlands: Yes. I am aware that the South Wales ports are deep water ports, too. In the consultants' report on M.I.D.A.S. the top choice site was Newport and Cardiff. The point is that we do not do the cause of Bristol or of South Wales any good by disagreeing among ourselves. Surely the essence of the problem was put succinctly by Lord Rochdale when he said:
"It is clear indeed that at present there is a danger that capital might be invested in Bristol in a duplication of facilities which already exist which are under-employed at Newport. We feel, in order to guard against any such wasteful investment and in order to make possible the rational development of port facilities in the upper Bristol Channel, a much closer association between Bristol and Newport than has existed hitherto is essential."
It is six years since those remarks were made, and they are as true now as then. We need a properly co-ordinated plan. I hope—and this is where I join with the hon. Member for Bristol, West—that before the year is out the Minister will produce a comprehensive plan for the whole of the ports in the Severn Estuary,

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if only to save us from yet another application for another mini-Portbury plan and further undignified squabbles.
7.45 p.m.
Mr. Paul Dean: The hon. Member for Cardiff, North (Mr. E. Rowlands), understandably and properly, has put the case for the South Wales ports. I rise to support my hon. Friend the Member for Bristol, West (Mr. Robert Cooke) and the Bill. Most of the land area concerned in the Bill is in my constituency. When this project—I say "when" rather than "if"—is completed, many of my constituents will be concerned with it, particularly those in the parishes of Portbury and Easton-in-Gordano. I am naturally anxious that their interests should be fully safeguarded. It is partly for this reason that I am happy to support the Bill.
The consultations which have taken place between the Bristol Corporation, the Somerset County Council and the Long Ashton Rural District Council have been amicable. The Corporation has agreed to introduce certain safeguards in the Bill, particularly concerning planning permission for any development in the area, other than maritime works. It is significart, and certainly satisfying from my point of view, that there has been this amicable agreement between the Bristol authorities and the Somerset authorities in this matter.
We are today in a most extraordinary and unusual position. We have had Bristol, through its foresight and its vision, planning and saving for this project for a number of years. It was prepared to back its judgment and to raise the money to provide the development which we believe is necessary for the Port of Bristol. We have had the National Ports Council, the body of experts set up by the Government to advise on port matters, reporting in favour, first, of the Portbury scheme and now of the Bristol West Dock scheme.
We have had the Economic Development Council for the South-West putting this as one of its three main priorities for the economy of the region as a whole. We have had the regional C.B.I, and the trade unions coming out strongly in favour of it. We have had, too, the Port of Bristol Authority with its long experience in these matters. Therefore,
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the vision, the money and the expert approval all say "Yes", but the Government, and only the Government, say "No". I hope, trust and believe that no Bristol Members, on whichever side of the House they may sit, will vote with the Government on this issue tonight.
We have had a variety of arguments from the Government since this controversy first started. We are told that the country does not need this additional capacity, that it is best to concentrate it in a limited number of ports, and anyway the South-West will not suffer. I do not want to deal with the detailed arguments because I think that they will come more appropriately from hon. Members on both sides who represent the City of Bristol, but I find it disturbing, and indeed one is bound to be suspicious, when one finds differing arguments being used.
Perhaps I might give the House an example of what I mean. When the Government turned down the original Portbury scheme, one of the arguments used then was that port hinterlands were comparatively small areas not more than 25 miles from the ports concerned. That was one of the main arguments, that there was not sufficient industrial development within 25 miles of the area concerned. But in the letter which the Minister wrote the other day to the Chairman of the Port of Bristol Authority he said that:
"the minimisation of overall transport costs may well be achieved by the concentration of traffics on more distant ports."
It is very disturbing when one finds entirely different arguments used, in the one case against Portbury, and in the other against a somewhat similar but more modest scheme on this occasion.
The Government appear to be disregarding the experts and shifting their ground from month to month. It is no wonder that the overwhelming feeling in the area is that the Government are being shortsighted, and are not really addressing themselves to the merits of the case.
I wish to put forward two other broad arguments which have not been fully dealt with, certainly not in the letter which the Minister wrote the other day to Sir Kenneth Brown. I think we all accept that the Bristol area is a natural growth area. The prospects for the future are bright. No one on either side of the

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Bristol Channel wants to preach gloom. The Severn Bridge is of great significance. We have natural advantages, and one of these which will soon be fully in operation is a first-class motorway system intersecting just north of Bristol. No other port in the country will have such excellent road communications with the main industrial centres of the country.
Mr. Donald Anderson: Does the hon. Gentleman appreciate that the argument he is using about the intersection of the motorways is equally relevant to the case put forward on behalf of the South Wales ports with their link with London with the M4, and the Midlands with the new Newport-Worcester Trunk Road?
Mr. Dean: I shall come to that in a moment. I do not agree with the hon. Gentleman, although there is an element of truth in what he says.
This is one of the main arguments, particularly when one considers the intersection of these two motorways from London and the Midlands. When one considers the container revolution with the new development which this demands, one realises that here there is a golden opportunity to build a new port on a green field site, with first-class road communications free from congestion. One cannot say this of any other port in the country, however much money one may put into it.
My hon. Friend the Member for Honiton (Mr. Emery) said, and we in the South West endorse it, as does, I think, the Secretary of State for Economic Affairs, that prosperity can and must radiate into the peninsula from the Bristol area. This is of significance for the whole region.
Having stated the advantages, what are the weaknesses? There are two which make this project of considerable importance. One is the natural pull eastwards to Europe. The development of natural gas in the North Sea is almost bound to mean a pull for development away from the western half of the country towards the eastern half. I am not complaining about that. All I am saying is that it is necessary for regional plans to take into account these natural pulls which are likely to develop, and which will not help the South-West.
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I am delighted, as I am sure everyone is, to see my hon. Friend the Member for Worcester (Mr. Peter Walker) on the Opposition Front Bench. I appeal to him to repeat the pledges which have been given by the party to which he belongs with regard to development in the Port of Bristol so that those concerned will know exactly where they stand, and what conclusions they can draw as a consequence.
My final point—and this was referred to by my hon. Friend the Member for Bristol, West—is that the promoters of the Bill have agreed to introduce into it a Clause which will ensure that the procedures under the Harbours Act have to be gone through before the Bill can be put into operation. There is nothing to be lost, and everything to be gained, by allowing the Bill to go to Committee where it can be considered on its merits. If the Measure gets on to the Statute Book, the arguments will have to be gone through again because the promoters have agreed that the Harbours Act procedure should be put into operation. If anyone on either side of the House has any doubts, he can come down in favour of the Bill knowing full well that the Minister has his safeguards through the Harbours Act.
I hope, therefore, that my hon. Friend will be supported in the Lobby by both sides of the House.
7.57 p.m.
Mr. W. A. Wilkins: I am pleased to have the opportunity to support the case made by the hon. Member for Bristol, West (Mr. Robert Cooke), but I confess that it is with some regret that I have to challenge the Minister's decision. I have a certain amount of sympathy with my right hon. Friend, because he has been in the Ministry for only three months, or slightly less—
Mr. Marsh: It seems longer.
Mr. Wilkins: —and there have been two previous Ministers of Transport while the Labour Government have been in power.
I am, therefore, sorry for my right hon. Friend, because he has been saddled with the responsibility of advising my city authority that he cannot agree to the scheme for the West Dock. In other words, he is the chap with the ring in his nose, and there is someone at the

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end of the pole about whom we should like to know.
I think that all the facts bear that out. All the evidence that we have suggests that that must be the case, because the Bill has been brought in owing to the dilatoriness of the Ministry of Transport in dealing with a matter which has been before it for nearly five years. I agree with the Minister that one cannot always make judgments based on sentiment or emotion, but sentiment and emotion do play a part in the life of the people.
I am proud to be able to state a case for my city, which is acknowledged to be the most progressive city in the country in all aspects of civic administration. I am not exaggerating. If I had the time I could quote cases over and over again concerning our health services, our education services and, not least, our dock services. We have had a dock in Bristol since 1200.
The Minister may say, "Yes, but as time progresses the situation changes, and there may now be justification for not encouraging the further development of this port." If he says that he must reckon with the feelings of the people of the city, who have an enormous pride in this great dock undertaking. It is because Bristol is a progressive city that it had the foresight in 1958, to begin negotiations for the purchase of land, in respect of the proposal which then came forward for the Portbury Dock scheme. The land was purchased in 1960. That is why I am sorry that the Ministry has been so lax in making a decision on the matter. It should have done so long ago. In the meantime, the ports in South Wales—I do not complain about this—who were sleeping in their beds while we were talking about progress, have been stimulated to come to the House to state their case against Bristol.
Someone—we do not know whether he is a consultant or an accountant at the Ministry of Transport—has been creating a picture which the Ministry is prepared to accept in order to controvert the case which Bristol has submitted. I bow to the Minister; I acknowledge that his intellectual capacities are greater than mine. I have not had the same opportunities that he has had for making judgments on theoretical figures, but I can
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tell him that there are schools in which one may learn far more than one does from an academic education—the school of adversity and the school of experience.
Mr. Marsh: I hasten to intervene to assure my hon. Friend that my grass roots are as clear as his are.
Mr. Wilkins: That does not alter my right hon. Friend's capacity for thinking along intellectual lines. My party now has too many intellectual Socialists and not enough grass roots. I was a member of the Bristol local authority for 10 years, from 1936. I was vice-chairman and then chairman of its electricity undertaking for a long time. It was second-to-none in the country. My experience of my colleagues on that local authority makes me far more prepared to accept their judgment of what is necessary for the development of the port in Bristol than the judgment of someone who has made an academic assessment of the present situation.
The Minister must not be surprised if hon. Members representing this great city feel hot and bothered about this, because in 1965 it was all but agreed that Bristol should have Portbury. Then the Minister disappeared. Then, I suppose, the scheme was put into a pigeon-hole, and opposition was stimulated. Allegations are freely made—I do not know on what grounds—that it has now become a political decision. It is strongly felt in Bristol that there have been certain interferences—whether from the South Wales ports or some other agency we do not know.
I am sorry that the Minister issued his statement only last Friday. It is significant that it was issued three days before the House was to have an opportunity to debate the merits of the Bill and decide whether it should go on to Committee. It is strange that the document should have been sent out on Friday to the Chairman of the Bristol Dock Authority, because the effect is bound to be to make this debate a little more than a charade.
Mr. Marsh: I take full responsibility for this action. My reason for sending out this statement beforehand was that I thought it would be intolerable for hon. Members to come here to debate a Bill of this type without knowing the Government's attitude. What I did was done for

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the benefit of hon. Members, and most of them have taken advantage of it to criticise quite fairly parts of the scheme.
Mr. Wilkins: If that was my right hon. Friend's object he is more at fault than I thought. If he thinks that a statement that came into my hands today provides me with an adequate opportunity for coming to a decision on the proposals that he is putting forward against the West Dock extension, he is wrong. I have not been able to absorb the alleged arguments of the Ministry against the West Dock scheme. This makes the position worse. I should like to know whether he is suggesting that the statement was sent to Members of Parliament representing the city. I have not received a copy. I do not know whether other hon. Members have. I had to obtain my copy from another source. But that is beside the point. It was unfair not to have made the statement available until only three days before the matter was to be debated in the House.
I confess that I do not know much about the economics of the matter, but I gather that the Minister's case is that his figures are right and the figures provided by the consultant to the authority are wrong together with their assessments. I gather that the judgment of the Bristol Chamber of Commerce and Shipping is wrong, and also the judgment of the South West Regional Planning Council. I gather, in fact, that everybody but the Ministry of Transport is wrong.
Yet my hon. Friend the Member for Cardiff, North (Mr. E. Rowlands) was quoting to us some observations made by Sir Arthur Kirby, who was at one time, I believe, Chairman of the South Wales Transport Docks Board. Now he is Chairman of the Ports Council. I ought also to point out that the Ports Council on two occasions agreed that Portbury was a viable proposition, as was the West Dock. I take it that the Ministry's case is that this proposal cannot be sustained because not sufficient exports will be going through the new dock to make it a viable proposition. The Minister must know that trade follows facilities.
I cannot grasp this at all. Two continental ports—Amsterdam and Antwerp—have more deep-water berths than we have in the whole of the British Isles.
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In that case, what are we thinking about in agreeing to a marina at Brighton, which will cost £13½ million and will merely be a sailing paradise, contributing nothing to our economy, and then saying that a great port like Bristol cannot, over five, six or seven years, spend a few million pounds a year?
The whole thinking on this matter is entirely illogical. It is utterly ridiculous to say that Bristol cannot develop a deep-water berth at its own expense, if necessary. Will the Minister tell me who it is advising him that these figures are not acceptable? This person is a phantom as far as I am concerned. He does not exist. I would be quite willing to sit down if anyone can tell me who he is.
I am quite certain that the judgment of my colleagues on the Bristol City Council, some of whom are listening to me now, and who have had 32 years' experience on this Docks Committee, and 40 years on the local authority, is more acceptable than anything else. I do not accept this alleged evidence as to why we should not have this scheme. I suppose that it is almost impossible to appeal to the Minister's sense of justice and ask him to withdraw his opposition and let this Bill go forward to a Committee for examination. I cannot understand why the Government will not let a Committee examine it. Let us have a good look at it and encourage the development of the Gateway to the West.
There is already a deep-water channel at this port. No dredging is necessary. Once the lock gate is built at a cost of £8 million—perhaps that is one of the reasons why the Government will not accept it—and when the country prospers, as all hope it will, the need to have more and more deep-water berths will grow and these can be installed here at an infinitesimal cost. All the necessary facilities for every aspect of dock development are there. There are 1,200 acres, bought with great foresight, in the belief that it would be in the national interest, awaiting development.
I ask the Minister not to be hidebound, to perhaps look at what a predecessor of his thought about this. I want him to have second thoughts. We do not need convincing on this, we are convinced that this is in the interests, not only of Bristol, but of the country. When shippers are

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offered the opportunity of turning their ships round in 48 hours less than can be done at any other port, they will use such facilities. I ask the Minister not to be too dogmatic, not to accept the advice of theoreticians in preference to practical people, who have been operating this port for up to 40 years.
8.14 p.m.
Mr. Raymond Gower: May I ask your indulgence before I begin my speech, Mr. Deputy Speaker. You will have noticed that I tabled an Amendment to the Motion, in the traditional form, to reject the Bill.
Mr. Deputy Speaker (Sir Eric Fletcher): I have informed the hon. Member that his Amendment is not selected.
Mr. Gower: Yes, Mr. Deputy Speaker.
Like other hon. Members who have taken part in the debate, I am chiefly concerned with the main purpose of the Bill, put by my hon. Friend the Member for Bristol, West (Mr. Robert Cooke), namely, to authorise the construction of this new dock, the West Dock, at a cost of approximately £14,750 million. Hon. Members will have seen the letter from the Minister to the Chairman of the Port of Bristol Authority. In it the Minister pays tribute to the Port of Bristol. We all recognise the excellent quality and the great service the port has rendered. Nothing we say is designed to deprecate that service.
Mr. Robert Cooke: My hon. Friend is right in saying that we are all very proud of the past. But what of the future? Does he not realise that the Minister is frustrating the future of the Port of Bristol?
Mr. Gower: In spite of this tribute, which we all willingly pay, I, like the hon. Member for Cardiff, North (Mr. E. Rowlands), feel compelled to oppose the Bill for a number of reasons. During the proceedings in another place it was emphasised that Bristol was the largest municipal docks in the country, with a distinguished commercial history. The promoters tell us that the steady increase in trade since the war has caused pressure on accommodation to increase.
I notice that the hon. Members representing Bristol have not adduced the slightest evidence to this effect.
Mr. Wilkins Mr. Wilkins rose—
Mr. Gower: I appreciate that this is not a Committee stage. But they have not given any kind of guidance about this pressure on accommodation. It is said that existing facilities are insufficient to handle the increased traffic and deal with congestion and delays.
Mr. Emery: My hon. Friend is making quite outrageous statements. Those of us in favour of the Bill have not wanted to produce this argument, but if he wants to take it chapter and verse it is in the Tress Report.
Mr. Gower: I will come to that later.
Another contemtion is that the increased size of modern ships, and the limitations imposed upon accommodation as a result of this, is causing serious concern. I can understand that. The House has to consider this serious problem and the expenditure, which involves a substantial investment of resources. I understand that the dock site would cover about 250 acres, with an additional area for the deposition of spoil. The scheme would take five years.
The House may get the impression from a scrutiny of these statements that the existing facilities of the Bristol Docks are being used to capacity. Yet I understand that at Bristol vessels are worked on a one-shift per day basis. That is in marked contrast to the South Wales ports where, subject to availability of labour, Barry and Swansea, for example, operate three shifts, and Cardiff and Newport operate two.
Mr. Roy Hughes: Is the hon. Gentleman aware that arrangements are being made to work a three-shift system in Newport?
Mr. Gower: That strengthens my remarks.
Despite the persuasive arguments advanced, the Bill should be rejected on a number of grounds. As the Minister pointed out in his letter to the promoters, the national need for this kind of additional port capacity has not been established.
Secondly, such a scale of investment might not be justifiable today, under present economic conditions. As the Minister said in his letter, there is a good

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deal of evidence to show that the project would not be likely to attract a satisfactory return. My hon. Friend the Member for Bristol, West suggested that the requirement of a return of 8 per cent. was unreasonable. However, the hon. Member for Cardiff, North pointed out that the manager of the Docks Board in South Wales was working on that basis, and even the higher one of 10 per cent. for new developments. This, too, is at variance with the case put forward by my hon. Friend the Member for Bristol, West.
Supporters of the project have emphasised that of the total cost of £14¾ million, about four-fifths would be provided by Bristol under the original proposition, so that only 20 per cent. by way of grant would be required from the Government. Today, my hon. Friend the Member for Bristol, West put forward another proposal and said that Bristol would find all the money.
Mr. Arthur Palmer: Is the hon. Gentleman aware that this is not a new proposal, but has always been the basis of the Bristol application?
Mr. Gower: I will show why that intervention is irrelevant. It may sound attractive for the Minister to be told that the promoters of such a project will find all the money, but that is not the final argument. Money is important, but it is not all-important in this respect, because a project of this kind would mean the diversion of enormous resources of materials and manpower. In present economic conditions such a diversion should not be undertaken.
My third argument is somewhat parochial. Hon. Members will be aware that for many years we in the South Wales ports have been trying to build up general and alternative traffic to replace the declining coal shipments. These long and laudable efforts have met with considerable success. Most of the hinterland is in the Welsh development area, which is quite different from the hinterland to which supporters of the project have referred. It would be a much more serious blow to South Wales if we should lose some of the trade from our docks.
Mr. Robert Cooke: Why?
Mr. Gower: Such a closure in our case is more important in the setting of the area. My hon. Friend cannot conceive of the difference of impact caused by the closure of docks in South Wales compared merely with, for example, the failure of Bristol to obtain more facilities.
The owners of the docks in South Wales, together with other interests, have succeeded to a large degree in variegating the traffic and our industry in the hinterland is also now more variegated. The Docks Board has played a notable part in modernising the docks, in closing down some of the less suitable docks and in enabling the docks to serve our newer industries. The result is that today instead of merely having coal ports, South Wales has ports which cater for many commodities, many of them of a specialised nature.
In my constituency we have built up the banana industry to such a point that Barry is now the largest banana port in the United Kingdom, a position which, I believe, was held by Bristol some years ago. Many food imports come to Cardiff and Cardiff Docks now cater for a great deal of the steel coil trade. We in South Wales now deal with Irish meat, timber, motor cars, oils of different kinds and many other commodities. This new trade is being developed by much sweat, anxiety and hard work. In my respectful submission, Bristol may obtain such a degree of increased trade, which may only partially justify the sort of investment about which we are speaking, but only if some of that trade is attracted from the South Wales ports.
In recent years the ports of South Wales have become modestly profitable. For example, in 1967 Cardiff had a net surplus of £43,000—not a great deal of money, but something. Newport had a surplus of £237,000; Barry, £127,000; Port Talbot, £123,000; and Swansea, £35,000. I need only mention these figures to show how delicate a margin exists and how easy a surplus of, for example, £35,000 for Swansea could be turned into a loss.
It was pointed out in another place that despite the efforts of the South Wales docks, much of its trade is marginal and vulnerable to slight changes in circumstances. The British Transport Docks Board has said that the implementation of this Measure would

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seriousty threaten the South Wales docks. I should add that the Board is not a South Wales organisation. It owns docks throughout the United Kingdom. It has pointed that the implementation of the Bill would be a serious threat to the work which it has done to try to salvage our docks in South Wales.
Mr. Wilkins: Is that the phantom about which I was speaking?
Mr. Gower: I really cannot answer the hon. Gentleman's question.
I will give some concrete examples of what I mean. The loss of the present vehicle traffic to the South Wales ports would mean the loss of about £130,000 a year gross. The loss of the steel coil traffic to Newport would involve a gross loss of £600,000 a year. That sort of margin would probably remove the present small surplus and make these docks unprofitable again.
I have shown that we in the South Wales ports offer a wide range of facilities. These are by no means fully employed. On the other side of the picture, Bristol wants to design new docks for a very different sort of volume of traffic than Bristol has been employing in the past.
Mr. Wilkins: The hon. Gentleman will agree that South Wales could not accommodate this type of traffic because its docks do not have the deep water which is available in Bristol for huge modern ships.
Mr. Gower: Nor does Bristol have these facilities at present.
Mr. Wilkins: It will.
Mr. Gower: Only if this Measure goes through. The port facilities in South Wales could be designed to accommodate some of the larger ships more cheaply than the expense involved in this Bill. What we have, therefore, is a contrast: on the north side of the Bristol Channel—partly used, very useful and varied facilities; on the south side of the Bristol Channel—a port that is working at a certain level, but wants to increase that level irrespective of the consequences to other ports on the South Wales side.
As far as I can ascertain from the previous proceedings, the total of trade in Bristol in 1967 was 8·3 million tons, and I understand that it is hoped to
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increase that in due course by 2,300,000 tons. Even if the estimated displaced traffic of the old city dock is deducted, there will be a net increase of 2 million tons—a formidable proportional increase over the present 8 million tons. If this is not done, the figures on which the promoters have been working as to the project's viability fall to the ground. The promoters must get this sort of trade to make the thing viable even by their own estimates. This is a formidable increase, and it could only be obtained with some really serious consequences to the South Wales ports.
I therefore respectfully ask the House to reject the Bill for the several reasons I have given: the costing, the need, and the consequences to other ports that have unused capacity. I cannot accept the argument that without this extension Bristol would sink to the status of a backwater. It would still be a very flourishing city and port. Bristol is in the centre of what has been described as one of the fastest developing areas of its kind in the United Kingdom as regards both population and employment. It will, including Avonmouth, have very large and important docks even without this extension. Those docks are capable of considerable improvement and technical innovation.
My hon. Friend the Member for Bristol, West has said we must get the Bill on to the Statute Book. That, on the face of it, seems to be a very reasonable argument, but in the circumstances it would be improper to accept it. If this kind of proposal is brought forward, Parliament should have an opportunity to reconsider it at an appropriate date. The Bill should be considered one way or the other today, and, if it is rejected, the promoters should come forward again.
8.31 p.m.
The Minister of Transport (Mr. Richard Marsh): As far as I can gather, this is an occasion when, whether or not the Government decide to support the West Dock scheme, they will offend a large number of hon. Members on both sides. This is probably a good thing in one way, because it is not a party political issue. There is no party line on whether one has a dock extension or not. It is an issue that the whole House is properly debating.

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If I may say so, one of the reasons why I decided to issue a very full and long letter last weekend was that it seemed to make a mockery of our proceedings if the Government's arguments were to be given three-quarters of the way through a debate. If the issue of that long letter offended some hon. Members, I am sorry: the intention was to ensure that everyone was as fully aware of the facts as possible. There is no reason for the Government or any particular hon. Members to have a view which is against Bristol, nor, for that matter, is there any reason why the Government or any block of hon. Members should have a view which is against South Wales. What we as a House are considering is a major piece of national investment. That is why I think it right and proper to have this debate and for hon. Members to express their views. It is interesting to see how the divergence of views cuts across both parties.
One thing that I regret is that, so far, the debate has been very much an argument between South Wales and Bristol—
Mr. Emery: But is the Minister aware that there are a number of us not from Bristol or South Wales who are waiting to speak? It is he who has turned the debate into a South Wales and Bristol argument at this moment.
Mr. Marsh: It seems that I cannot win. If I try to reply to some points raised, hon. Members are still critical. The discussion has centred very much between Bristol and the South Wales ports—
Mr. Palmer Mr. Palmer rose—
Mr. Marsh: It would be helpful if I could complete a sentence of my speech.
Mr. Palmer: I think my right hon. Friend has risen much too early. He has not heard many arguments yet to be put. It is most unfortunate that he should intervene so soon.
Mr. Marsh: It is perfectly normal practice on a Private Bill for the Minister to express the Government's view—[Interruption.] My hon. Friend is entitled to his point of view, but from his long experience in this House he will be aware that it is normal for the Minister to intervene in the middle of a debate.
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If he allows me to make my remarks, the debate will continue after that.
This is not a debate on South Wales ports versus Bristol ports but one concerning a very small country with very limited resources about the way in which it uses those resources to the best advantage. This is something on which people can have many differing points of view.
The hon. Member for Bristol, West (Mr. Robert Cooke) raised a number of questions. The first specific question was: would I give an example of port investment which had reached 8 per cent. and above? The sorts of rates of return we are talking about are very limited; we have very limited resources available for public expenditure of any type and very limited resources for public expenditure on docks. On Tilbury stages 2 and 3, the return on gross cost is 10·5 per cent. to 13 per cent. On the Tilbury grain terminal, on the gross cost it is 10·3 per cent. and on the net cost 12·5 per cent. At Seaforth, on the gross cost it is 9·6 per cent. At Greenock, on the gross cost the return is 16 per cent. to 22 per cent.; at Newport timber and cargo terminal it is 11·8 per cent. to 12·4 per cent.; at the Swansea roll-on and roll-off berth, on the gross cost it is 11 per cent. and on Bristol ore berth port improvements the return on gross cost is 13 per cent.
Against that I have figures to deal with the investment in the West Dock, where the return on gross cost would be between 1 and 3 per cent. I am not making the point on questions of d.c.f. return, but this is one of the few measures we have of public expenditure. I am not saying that it is always right, but it is one of the few guidelines we have. On any basis of port investment the return on d.c.f. investment is very low indeed.
The hon. Member also asked, if the Government would agree that if the Bristol Port Authority decided to dispense with the 20 per cent. grant, would the Government then agree to the proposal? Much as I am sorry to have to say it, the Government would not, because the problem we face is: whether the money is raised by Bristol Corporation, using the rates as security, or direct out of Government funds, it is public expenditure. I cannot understand particularly hon. Members opposite, whose case so often is a complaint against existing levels

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of public expenditure, criticising the Government because they will not embark on major expenditure.
Mr. Robert Cooke: The whole point is that this is a valuable asset in the form of city docks which are obsolete. We cannot use the resources of those lands and docks to pay for future expansion because the right hon. Gentleman will not allow us to expand.
Mr. Marsh: The hon. Member has missed the whole point. This is public expenditure however it is raised, and it counts against any other form of public expenditure. This is not confined to hon. Members opposite. Everyone is in favour of reducing public expenditure, yet immediately produces a long list of highly desirable objects which on their merits involve increased public expenditure.
The question of Brighton Marina has gained great prominence in this discussion. First, the Government have not approved the Brighton Marina project. Secondly, of the total cost of Brighton Marina, the harbour works and yacht basin are about £3½ million as opposed to the £15 million we are talking about. Thirdly, no public money is involved in the Brighton Marina project. This is private capital raised on the open market. The main point about this is that no decision has been taken about Brighton Marina by the Government and there is no public money involved.
As I said before, I do not want to take sides in this Wales/Bristol argument, because I do not think that this is the issue. I join my hon. Friend the Member for Cardiff, North (Mr. E. Rowlands) in his complaint about the extent to which the effect of this decision on Bristol is being exaggerated. Over the past ten years the average rate of growth of traffic through the major United Kingdom ports has been nearly 3 per cent. per annum. The comparable figure for Bristol is less than 2 per cent. Yet, although the comparable trade for Bristol has been considerably less than that for the country as a whole, the northern sub-region of the south-western region has been developing at a faster rate than any other in the country.
Between 1961 and 1966, the total population of the sub-region rose by 6·7 per cent., whereas that for Great Britain as a whole rose only by 3·8 per cent. Even
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allowing for the additional number of people in the region, during the same period the number of jobs in the sub-region rose by 7·1 per cent., against a national average of only 4·1 per cent.
Therefore, in this area the amount of port traffic is considerably less than the average for the country as a whole. Despite that, the growth in the sub-region, in terms of population and of jobs, is higher than that in any other part of the country. In the light of that, how can it be argued that this is an area which is dependent upon the ports? If this were so, we would not expect the rate of jobs to be growing so much faster than the rest of the country when the rate of port activity is rising much more slowly than that of the rest of the country.
Mr. Dean: Surely the whole argument which we are making is that, because these new jobs have been created in comparatively recent times, it is essential that there should be port facilities available so that this new prosperity which will create new requirements for imports and exports can be properly dealt with.
Mr. Marsh: The hon. Gentleman is confusing the country with some small island. The people who live in Bristol will be getting their imports and making their exports through all sorts of ports—Bristol and others. The argument can be made for Bristol West Dock, but the argument that a town which is expanding must have its own port to maintain its prosperity is a little thin.
The point which I was making, and which is an important one, is that it is argued that the port development is a crucial factor in the development of the area. The facts show that with a substantially lower rate of growth in port traffic there is a very much higher rate of growth in terms of employment.
This is a national problem of very real interest to the whole country, wherever one lives. There are two essential issues here. One is the control of public expenditure. The second is: given the need for considerable investment in the port system of the United Kingdom as a whole and very limited funds with which to do it, is it right for the Government to use the powers given to them by Parliament to ensure that that investment is placed in the areas where the maximum return lies?

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It may well be asked: if Bristol, which has devoted much thought to this—I do not for one moment overlook the enormous civic pride which Bristol has—wants to have this port development, why should Parliament intervene? If Parliament does not want to control either public expenditure of this level or port investment of this level, it is taking a decision which will have very serious repercussions. No one is arguing, certainly not I, that the Bristol proposal is some sort of airy-fairy thing which does not hold water. It is a very substantial document and is very well worked through, if it is regarded as a Bristol proposition. No Minister of Transport can look at it in that way, either in terms of expenditure or in terms of the effects on the port.
Yet I must confess, if I were a Bristolian, I would have some doubt about a project which would be such a charge on public funds as this one. We have done calculations on the effect on Bristol, and it is a very complex issue. The direct impact on the rates would vary with the method of funding the debt and the ability of the rest of the port to make a profit to absorb the deficit. Taking Bristol's own lower traffic forecast, it works out in this way. In the second year there would be a deficit of £97,000 which would be just over 1d. on the rate. In the third year there would be a deficit of £258,000, equivalent to a 3d. rate. In the fourth year there would be a deficit of £507,000, equivalent to 5·7d. on the rate. In the fifth year there would be a net deficit of £748,000 with a rate equivalent of 8·4d.
Mr. Peter Walker: Is the right hon. Gentleman giving figures for the highest estimate?
Mr. Marsh: No, I made the point that I had taken Bristol's lower traffic forecast. Although the National Ports Council supports the scheme, it does not accept the Bristol calculations, not even these. The Bristol local authority calculation is very complicated and upon it depends the effect on the rates. Nobody is in any doubt that this is not expected to be a profitable investment for a very long time, if ever. That is not a matter for me; that is a matter for Bristolians. The burden of my case is that a major port
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investment must be viewed in a national context in terms of port policy and the call on national resources.
What then are the powers of the Minister? The Harbours Act, 1964, which was passed by hon. Gentlemen opposite gives us the powers that we are using on this. With a view to securing the proper control in the national interest of schemes of harbour development, the Minister was given power to authorise or refuse projects costing over £½ million. This provision enables the Minister to exercise a purely negative control over individual projects so as to prevent duplication and take into account regional planning.
There are two issues on the question of national port planning. On the one hand, in the general cargo trades the development of modern techniques has led and is leading to increasing concentration of traffic on the routes and services which can take full advantage of the economies that they make possible. Traffic to Europe is increasingly tending to concentrate on ports on the South and East coasts where the individual container services and vehicle ferry services provide rapid door-to-door transport.
On the deep sea routes the tendency is to concentrate the trade for each of the major overseas trading areas on a limited number of services and ports, so that there is sufficient cargo to maintain reasonable frequency of high volume services. Except possibly for one North Atlantic service, it does not seem in the least likely that Bristol will be selected as the terminal for deep sea container services.
My predecessor and I have had the advantage on this point of the views of the Chamber of Shipping and the major container consortia. On some routes it is possible that both the United Kingdom and the Continent may come to be served by vessels calling at one of our ports en route to, for instance, Rotterdam. Again, Bristol does not seem to be well placed even for such calling services. Moreover—and this is the important point—there is a surplus of capacity for general cargo traffic in the Severn Estuary as a whole. Several hon. Members have made this point. It is not a question of it being of interest to South Wales, though it clearly is; it must be of interest to the nation. Moreover, additional provision

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can be made elsewhere more cheaply than at Bristol.
In the second place, we are concerned with the development of bulk imports. The size of vessels used has been increasing and is likely to continue to increase. Coupled with that is the growing and desirable tendency to locate bulk processing industries adjacent to the deep water berths handling their raw materials. The West Dock would not have been able to handle modern crude oil tankers or the iron ore ships of the future. These are or will be catered for at Milford Haven and in the new Port Talbot harbour.
But the real question is whether there is any prospect of investment in the dock paying off either in real return on the investment or in terms of its desirable contribution to general regional development, and doing so at least on the same scale as possible alternative investments. I do not want to go into all the detailed argument about the precise financial return likely to be obtained from the investment in the new dock. These calculations can be no more than a rough guide to a decision. The calculations depend on traffic forecasts which in turn must involve a large element of judgment.
On some aspects, we, the Port of Bristol Authority and the National Ports Council, all agree. On others we disagree. But the returns estimated range from 1 per cent. to 9½ per cent. on a d.c.f. basis. Bristol's own calculations show a range from 6 to 9½ per cent., as against the Government's normal minimum standard which, as I said, is applied to all other major port investment projects, of 8 per cent. on low risk.
Comment was made about advice I received from the National Ports Council. It recognised how difficult the question was, and paragraph 4 of the annexure to the letter from the National Ports Council, this independent body, shows d.c.f. returns varying from 2¾ per cent to 4½ per cent. But one must look further into it. I recognise the difficulty facing the National Ports Council.
Sir Arthur Kirby, who has given a great deal of attention to this matter, says at the end of his letter:
"I am aware that in passing this recommendation to you I am advocating a project on the speculative basis of, so far as we are
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able to show, little more than long-term prospects."
He goes on:
"Though giving full weight to the possibility of over provision of capacity in national terms, with consequent financial problems, I think that this state of affairs would not persist for a prolonged period."
Finally, he says:
"It is not to my liking to have to recommend a project on this negative line of reasoning. Nevertheless, it is this, coupled with a belief that we cannot eliminate Bristol from the national ports pattern, that weighed decisively"—
and so on.
The National Ports Council came down solidly in favour of the Bristol scheme, as did Bristol itself. If things were different and we could have a speculative investment yielding a very low return, there would be a case for it. But in present circumstances no Government, of any party, would be able to accept an investment on this level, of this speculative nature and with this level of return.
The d.c.f. return is not the overriding criterion. The simple point is that, if we are to prevent misuse of the limited resources which we have for public investment, we have to ensure that projects which will give a return below that obtainable elsewhere are undertaken only if there are substantial additional arguments for them. For unavoidable geographical reasons, construction of the West Dock will involve heavy costs—£3 million per berth simply for the enclosed dock—before any actual berth structures or equipment are provided. That is to be set against costs ranging from £1·2 million to £3 million for fully equipped deep water berths in other ports. These costs would have to be met by the users, the ratepayers or some other sector of public funds. As I have said, it is no argument to say that the problem is solved if Bristol itself raises the money. The effect on local expenditure could be very heavy over a long period.
The Government have considered whether, in spite of the high costs, the project might be so important to the development of the Bristol area and the region as a whole to justify them in letting it go ahead. Obviously, one had to give serious thought to the powerful arguments and the case made by the South West Economic Planning Council. We have given the matter the fullest examination.

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Ministers have to take decisions at some stage, and they are never happy about it. I have never yet taken a decision which pleased anybody. I have tried four Ministries now, and it has been the same in them all. However, after the fullest examination, the Government have come to the conclusion that they could not justify this unremunerative project as a promotional investment.
The development of the South-West as a whole is very little dependent on the Port of Bristol. As I said earlier, the Bristol sub-region has been growing faster than any other in the country. The hon. Member for Bristol, West raised the question of jobs. This decision will not involve the sacking of anybody as a result. There has been a great deal of misunderstanding about it. What we say is that, if one takes all the existing industries which might conceivably be affected in the very long term, a period of 15 to 20 years, the effect in reduction of job opportunities would be equal to about one-quarter of the average annual increase in the number of jobs in the Bristol area over recent years. This decision has no employment connotation about it at all.
It is a prosperous area, an area which will go on being prosperous and expanding in both jobs and population. In view of the high rate of development in the sub-region and the urgent need to attract new projects to development areas, there seems to be no strong case for providing additional incentives to basic industries to establish themselves in the area by providing bulk import facilities for which the users would not be paying the full economic price.
That is the only way in which traffic on the scale envisaged could be attracted to the dock. But not building the West Dock does not mean the end of Bristol as a port. It does not mean the end of Bristol as a major port. As frequently happens in these disputes, some of the statements become more and more exaggerated as time goes on. This is understandable, because people are worried and nervous. There has been a great deal of exaggeration.
Avonmouth can be expected to handle for the foreseeable future substantial quantities of general cargoes of types or for destinations not covered by
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specialist container services, of foodstuffs, of raw materials for the paper and tobacco industries, of ores for the local works, including the new smelter which Rio Tinto Zinc decided to build there without waiting for the decision on the West Dock, of petroleum products for distribution, or as feedstocks for gas and chemical works and so on. Certainly the space available in the Avonmouth Docks is limited, but the sort of modernisation works which the port authority has already undertaken or has in mind will provide high throughput facilities enabling the docks to handle large volumes of traffic efficiently.
We do not have any sort of mysterious phantom at the Ministry of Transport which has a grudge against Bristol.
Mr. Wilkins: There is pressure somewhere.
Mr. Marsh: I hope that my hon. Friend will let me finish my sentence. I do not think that any Minister, whatever his political complexion, would take a decision on this basis. I am in no doubt about the political popularity of the decision, but the decision is taken on the basis of the investment and use of limited public funds. I am very well aware of the controversial nature of the decision and I am not unaware of the genuine pride of the people of Bristol. But a Minister must take a national view of its expenditure on this scale. Whatever phantoms we may have in the Ministry, I have seldom been more sure—I may be wrong—about a decision than about this.
I do not think that a case can be made out or supported. I hope that the Bill will be withdrawn. It would clearly be foolish in the light of the decision to go on ploughing the Bill through in the knowledge that the exercise would prove abortive in the end. But if the Bill is not withdrawn, with great regret I shall have to ask hon. Members on both sides of the House to reject the Second Reading in the knowledge that the limited resources which we have avaliable have to be planned, and nowhere more importantly than in the dock industry, and that this plan cannot be justified on that basis.
9.1 p.m.
Mr. Peter Walker: When the Minister intervened, I hoped that we

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were to hear some positive proposals for the development of the Severn Estuary as a whole. I hope that all those who have spoken in the interests of South Wales will note that there is not one crumb of positive comfort to them in the Minister's remarks. Those in South Wales who object to the development of the Port of Bristol in this way are making a fundamental mistake in their own interests, irrespective of the interests of Bristol. If the alternatives were major development of the South Wales ports and development of Bristol, it would be natural for them to represent their own interests. Once or twice in the debate I recalled the occasion when the Prime Minister spoke at Chatham in 1964 saying, "Why do I say that we should have a bigger Navy?" and a heckler cried, "Because you are speaking in Chatham." There was a ring of that from South Wales tonight.
The danger to the ports of South Wales is not the development of the port of Bristol. It is the development of London and Liverpool at the expense of other ports throughout the country. I believe that a cardinal error of investment judgment is being made by the Government in that they are to concentrate everything on two major ports which happen to be the two major ports which suffer more than any other two ports in the country from congestion. South Wales is making a great mistake in not suggesting that there should be greater concentration, spreading the investment to the north-east and the south-west, as opposed to concentrating it in the south-east and northwest. It is a tragedy for the whole development of the area.
I was very surprised when the Minister concluded by saying that he could not imagine any Minister giving the go-ahead to this project. What he was saying was that he could not imagine any Minister agreeing with a recommendation of the National Ports Council and a recommendation of the Economic Development Council for the South-West. When he said that seldom had he been more sure of a decision than the decision to stop the development of this port, he was going against the views of the National Ports Council and against the advice of the Economic Development Council for the South-West and saying that never had he been more sure of
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the correctness of a decision which went completely against the recommendation of the two Government-appointed bodies primarily concerned with the project.
I must confess my own considerable disappointment at the manner in which the project has been dealt with. First, there has been this constant delay. There was a recommendation of the National Ports Council which was turned down. Then there came the publication of the White Paper which contained many questionable assertions and arguments. Following that, it was decided to institute a new scheme. That was operated and worked upon.
The Minister tried to defend himself by giving his detailed reply only three days before the debate, but it was the Prime Minister who said eight weeks ago that the decision would be known in three weeks. There was, therefore, a further five weeks' delay with publication of the Minister's reply only a few days before the debate.
I would like to examine some of the Minister's main arguments against the scheme. The first is the rate of return. A rate of return on the investment is only one factor when considering the rate of economic return in terms of Government expenditure. One of the important rates of return would be if the development of the Bristol port resulted in a diminution of congestion in other very congested areas. I am confident that this would happen, because a great deal of Midlands traffic goes either to Liverpool or to London and causes a great deal of congestion as a result.
Secondly, when considering a rate of return from the Government's viewpoint one must consider the reduction in costs of certain forms of motor transport delivering the goods to the docks. This would be an important factor with a port linked to motorways in the way that this one will be linked. Therefore, the rate of return is only part of the argument.
When the rate of return is suggested as being a positive return by everybody who has examined the proposal, and the people of Bristol are confident that it will be a good return, I must confess to having a great deal of sympathy with the sentiment expressed by the hon. Member for Bristol, South (Mr. Wilkins). The

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hon. Member said that in this sort of exercise one can look at figures and statistics, but the figures and statistics that are available are all historic figures. What is not available is always a commercial judgment: that is, the likely effect of a new port with new facilities on a new, previously green-field site linked with two major motorways.
For example, when the White Paper was published giving the reasons why the Government refused Portbury, the facts given for the motor transport costs and the volume of traffic likely to be attracted from the Midlands were all based on the existing road system and existing transport costs, whereas with the completion of the motorway very different transport costs would be involved.
What the Minister or, at least, his advisers have failed to recognise in all their calculations on Bristol is that it is not purely the distance factor which attracts goods. The time factor in delivering them is much more important than the distance. If a lorry has to go 20 miles through congested traffic and takes three hours to reach its destination, people prefer to send their goods on an 80 mile journey which takes only two hours. This calculation has been omitted.
I would much prefer to accept the judgment of the people of Bristol, who are willing to take this risk. The Minister was, I think, endeavouring to panic them to put them against the project by his remarks about the rates. It is the first time that the Government have used that argument. Never before have they tried to illustrate it.
There are several reasons why the rate argument is a particularly bad one. First, the Minister quoted figures based on the lowest estimate, which, therefore, gives the worst possible interpretation of what might take place. Secondly, he failed to take into consideration an increase in the rateable value for Bristol which may well result due to the development of these ports and docks by attracting other industries and economic expansion to the area.
Thirdly, although he must have been aware of this, the Minister failed to tell the House that the Port of Bristol had £2 million worth of reserves and that it was
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out of these reserves that Bristol would meet the initial deficit.
Mr. Marsh: I think that I made it clear when using that as an analogy that it was a complex matter and it depended entirely on the way that the debt was funded.
Mr. Walker: I am grateful for that half apology, but the only object of quoting the figure of 5d. in the £ on the rates was to frighten the people of Bristol into thinking that they were on to a bad bet, whereas the Port of Bristol and all the political parties in the council, who are united on this matter, know the figures, know that they have the reserves and know that it will be in the interests of the ratepayers and the people of Bristol to go ahead with this project. That is their calculation knowing all the figures and statistics that the Minister knows.
Mr. Wilkins: The scheme would have the further advantage of a release of land within the middle of the city.
Mr. Walker: Yes. The hon. Member has made that further point. Therefore, on the grounds of the interests of the ratepayers, I do not accept the Minister's argument.
The right hon. Gentleman went on to industrial development, again saying that no case had been made because the rate of industrial development had been faster than that of the rate of traffic into the port and, therefore, there was no argument on this basis. We know, however, that the development of the port will affect the whole of the South-West. This is one of the main proposals of the Economic Development Council for the South-West.
If the Government are going to set up these Councils in these regions, appoint people to them to give them their advice, and they say that there are three major things which can be done for the economic development of a region—in this case, the South-West—at least the Government might heed their advice. If they do not, what is the point of having an Economic Development Council for the South-West at all?
Mr. Anderson: The hon. Member asks why we should bother to appoint these good people if we are not going to accept their recommendations, but surely

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even he would not expect the Government to accept every recommendation made? Secondly, does he not think it unfortunate that, within its remit, the South-West Economic Planning Council was not able to look also at the effect of these proposals on the region and on the South Wales ports as well, and not simply at Bristol?
Mr. Walker: As to the second point, the Minister has not given any positive hope to the region at all, either South Wales or the South-West. Unlike some hon. Members, I have visited the South Wales ports and I know exactly what is going on there. As to the first point, of course I do not expect the Government to accept every proposal, but when the Planning Council comes out with its report on economic development for the South-West and makes three major proposals, and many minor ones, it ill becomes the Minister to say that he does not think this is of any importance in the economic development of the South-West, and to say that without giving any detailed argument.
I believe it is absolutely right to go ahead with this project, and certainly if I were in the Minister's position I would give the go ahead to this project.
First, I think the Minister's answer is based on an outdated concept of looking at the previous pattern of development of ports. I cannot do better than quote the right hon. Gentleman's predecessor when she turned down Portbury. She said:
"Recently completed analyses of port traffic flows and their relationship to port hinterlands show that the great majority of our imports and exports are generated close to the ports through which the traffics flow."
I believe that concept has dogged the Ministry of Transport ever since. The Ministry has failed to realise that the motorways, and possibly the freightliner trains, will transform the pattern of ports.
Secondly, Bristol is prepared and ready with its plans. It has an ideal site and a port well managed by a port authority which can boast of a really remarkable record of achievement over the years, an authority of no political complexion. I have visited the port authority a number of times, and the thing which has impressed me is that the port authority is not party political, but that everybody in Bristol is rightly proud of it and its
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achievements. In those circumstances, I believe Bristol should be given the go ahead.
If the go ahead had been given originally, to the first project, that scheme would be well on its way by now, well under construction, and ready for the completion of the motorways. On the argument of the hinterland, the Government have failed to recognise the importance of the M5 and the M4, one motorway bringing from the Midlands a great deal of traffic which would otherwise congest other parts of the country, and the other, the M4, bringing traffic from the industrial areas west of London. Thirdly, the Government have failed to recognise the importance of time, not distance, in travel to ports. Fourthly, they have failed to recognise the importance of such a port in the development of the South-West.
They have failed, too, to recognise the potential of such a port on the main, long sea routes. Let it be remembered that this port is 250 miles nearer to the United States than is the Port of London, and 232 miles nearer South America. On these factors alone there would be an advantage in using the Port of Bristol.
I believe the Government are wrong, and I certainly hope that the next Government will take the opportunity of going ahead with such a project to enable this port to expand, on no other grounds than that Bristol is a city of people who are determined that their historic port shall be modernised so that they may show that spirit of merchant venturing for which they and their city are renowned. I think it is right for the Government to turn down such a proposal if, quite clearly, it is an absurd, ridiculous project.
If Bristol had come forward with a scheme which sounded splendid for the City of Bristol, but all the figures showed that it was an absurd and ridiculous scheme, I would have opposed it. Indeed, when I first went to look into the Portbury Scheme, when I was appointed "shadow Minister of Transport", I must confess that I went there with some scepticism that that was a place which was clinging to an idea which was not warranted. Having examined the facts and details of the reports since then, I think investment on the historical figures is marginal. But with the spirit of Bristol

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and the various developments which are taking place, I believe it has every likelihood of being a successful investment. I hope that at the earliest opportunity it will be given the chance of proving that the City's confidence is fully justified.
9.16 p.m.
Mr. Arthur Palmer: I intervened when my right hon. Friend the Minister of Transport was speaking to protest against what I thought was his too early intervention. My right hon. Friend reminded me that I should know the practice of the House. I do know the practice of the House. However, I thought that my right hon. Friend should have waited because I hoped that he would listen to further arguments. However, he has obviously made up his mind in advance of the debate and nothing for the moment will change it. Therefore, as a Bristol Member representing that historic part of the city in which is situated the old docks, as distinct from the new docks we are discussing tonight, I propose to answer some of the points which have been raised.
I want to assure my right hon. Friend that this is a continuing fight; it is not one which Bristol will give up lightly even if we lose the vote tonight, which I still hope we will not.
My right hon. Friend has made his decision. I will say a few words about the timing of it in a moment. I think that it is most unfortunate that my right hon. Friend has not, as yet, been to Bristol to see the Avonmouth site for himself. At least his predecessors went to Bristol. My right hon. Friend has made this decision, which is of great consequence to the city, without seeing the issue, if you like, on the ground. At least, that should have been done in fairness to Bristol and its work.
My right hon. Friend says that the country cannot afford the West Dock; that in different circumstances it would be a different matter. If that is the case, why could not Bristol have been told this by the Ministry a long time ago? Surely, in these circumstances the protracted delay is indefensible—1964 to 1968. The first Bristol scheme came forward in 1964 and since then we have had four years of delay. This has not been
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for lack of activity on the part of Bristol Members on both sides. We have pressed the present Minister, as we did his predecessors, for a decision but no decision was given until now.
I helped my right hon. Friend by putting down a Question, because he said that he would make a decision on Friday last. But it was only at the last minute of the 11th hour that the decision was made. My right hon. Friend says that it was to help the debate; that it would have been unfortunate if there had been no statement before the debate. The fact is this debate on the Bill has precipitated my right hon. Friend into making the decision.
Great bitterness is felt about the decision in Bristol, on both sides of the political fence. This was a scheme which was put forward by the Port of Bristol Authority, unanimously backed by the city council when the Labour Party was in the majority, and it has been supported since the Conservatives, or Citizens, as they call themselves in our city, have taken over—I hope temporarily. I assure my right hon. Friend that there will be great bitterness about the way in which the city has been treated.
The leader of the opposition Labour Party on the city council has given me the text of a motion which is to be put down for a meeting of the council tomorrow. I am sure that the motion will receive unanimous support. It protests against the way in which Bristol has been treated, and assures the people of Bristol that the council will continue its fight, as I said earlier.
I think that the hon. Member for Worcester (Mr. Peter Walker) was right when he said it was rather sad that at this stage the Minister should try to scare Bristol ratepayers by talking about the effect of this scheme on the rates. This is a flourishing enterprise. It happens to be the largest remaining single municipal trading undertaking in the country. In an earlier age it would have been a source of Socialist delight. Here we have a public undertaking directly responsible to the people of the city, and controlled by them through their votes.
Mr. Marsh: I did not intend to scare the people of Bristol. I used that as an argument to demonstrate that on the calculations which had been made this dock

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would lose vast sums of money for at least the first nine years.
Mr. Palmer: I have heard many arguments against Bristol, but that is the most novel. It must have been necessary to dip to the bottom of the rag bag of arguments to bring that one up. I am sorry if I offend my right hon. Friend, but we must speak plainly on this matter, because we feel strongly about it. My right hon. Friend told us, and it is no novel economic discovery, that it is not just a matter of cash, but of economic resources.
Mr. Marsh: No.
Mr. Palmer: Then what did my right hon. Friend say?
Mr. Marsh: I am sorry if my hon. Friend wants me to keep intervening. I was talking about the fact that public expenditure amounted to so much. I did not make the point about economic resources.
Mr. Palmer: I thought that my hon. Friend was saying that one could not argue that because Bristol had money the city ought to be allowed to go ahead, or because it could raise the money it should be allowed to proceed. I thought that he was saying that it was a matter of the proper disposal of national economic resources. That is my recollection of my right hon. Friend's argument, and it sounds a good one, but there is public expenditure and public expenditure. The case for Bristol is that this is not merely in the interests of Bristol, but in the interests of the general prosperity of the country. In short, it is a fit and proper use of economic resources, scarce as they may be.
It seems curious for my right hon. Friend to argue that all docks development must be co-ordinated in a national plan. He was previously the Minister of Power, and as such sanctioned the expenditure of public money on the electricity, gas, and coal industries, which compete with each other. Some of my hon. Friends do not particularly like that system, but it is one which my right hon. Friend supported, and which, incidentally, I support.
It is compatible with the planning of national resources to have reasonable competition between ports. Socialists
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differ always on what is a Socialist argument. I am simply pointing out that if we invest in electricity it does not mean that we must not therefore invest in gas, because they are both sources of energy. In fact, there is now reasonable competition, and that is very much in the interests of national efficiency.
I was glad that my right hon. Friend did not this time overstress the question of discounted cash flow. In fact, he seemed almost as doubtful about its value as was Professor Tress, in the South-West Survey. As an engineer I am, by nature, always suspicious of accountants. They generally stand in the way of getting things done. The first thing about discounted cash flow is that it is possible to make the figure almost anything. It depends on the assumptions that are made. It is possible to conjure with the figures and throw anything into the equation.
In my view, that is what the Ministry has been attempting to do. The Ministry says that it is 6 per cent., and that if it is 6 per cent. we cannot have it. The Authority has argued that it is 9½ per cent. at the maximum. The question is not objective; it is subjective. Almost everything has been dragged in to produce figures which blacken the Bristol case.
I should have thought that the proper view to take was that Bristol has given great thought and a vast amount of time to working out this scheme; that it is already a prosperous port; that its judgment has proved sound in the light of past experience; that it has excellent management and good local judgment by the man on the spot; and that in all the circumstances the Government were not taking a great risk in allowing Bristol to trust its own judgment and go ahead. I was delighted that my right hon. Friend did not seem to think very much of discounted cash flow, because I do not think much of it myself. It is, therefore, largely a question of personal judgment and local initiative.
The real reason why this scheme has been turned down has not been frankly stated. The reason is political. The scheme has been turned down because of pressure from South Wales—and especially from the Transport Docks Board, which hopes to be the germ of

167
the new nationalised organisation. I am not against such nationalisation, but I hope that there will still be a considerable measure of local control. The view has also been put forward—and it is perhaps even more dangerous—that since Bristol is already prosperous its further development can easily be sacrificed. I must point out that the prosperity of Bristol is the prosperity of Severnside and that the prosperity of South Wales is equally the prosperity of Severnside.
As to the idea that Bristol can be run down so that other areas can be lifted up, I would have thought that a sound judgment would be that the future should be built on the best and not on the average.
Much was said, in great detail, in the other place. My hon. Friend the Member for Cardiff, North (Mr. E. Rowlands) quoted extensively from the report of the hearings before the Select Committee in the other place. It is a weighty document, which I have here. My hon. Friend did not say that the Select Committee reported to the other place that the Bill should proceed. I hope that the excellent example set there will be followed here tonight.
My right hon. Friend said that this was not a party question. If it is not a party question I hope that it will not be decided by a party vote, and that the Whips will not use their influence at the doors of the Lobbies. We shall see.
The Bill should go into Committee. The Government have nothing to fear from that. Let the case of the Bristol and the South-West objectors be heard. I do not think that there is any procedural difficulty in having the Minister before the Committee. If, on Friday, we had received the answer "Yes" for Bristol, the Bill would still have been needed to implement the decision. There must be a Private Bill. If it is referred to a Committee the Minister's position is fully safeguarded, because if it became an Act, it could not be activated unless his powers were invoked. This has been agreed to by the sponsors already.
Whatever influence may be exerted by the Whips in this matter, I am sure that the Bristol Members present will vote for the Bill. I certainly shall. It would be a bad day in parliamentary representa-
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tion if Members who had the privilege of speaking in this place for a great and ancient city did not go into the Lobby on behalf of that city. I hope also that the majority of hon. Members on both sides will follow the example which will be set by Bristol Members.
Mr. Speaker: Order. I would remind the House that there are 28 minutes left and quite a number of Bristolians and anti-Bristolians want to speak.
9.32 p.m.
Mr. Peter Emery: Anyone who has listened to the debate so far, with the exception of the speeches by the two Front Bench spokesmen, might have concluded that this was purely a battle between Bristol and South Wales. This is not the case, and it was for that reason that I so quickly interrupted the Minister. I use as the basis of my case the first of the recommendations on investment requirements for a strategy for the South-West, in the Tress Report. This is Recommendation 561, on page 123. It says:
"The Council"—
that is, the Economic Council—
"will continue to urge on the Government the importance of port investment in the upper Bristol Channel, particularly at the Port of Bristol."
There were also other significant paragraphs in the Report, particularly paragraphs 234 and 236. Throughout, one sees the South-West Regional Economic Planning Council urging the Government to accept the recommendation of approval of the Bill. The real tragedy of the Minister's statement is that this is the first of the three major recommendations made in the Tress Report. The Minister said that the Council has
"… made it clear that they regard the proposed West Dock as one of the three principal planks in their regional strategy."
The right hon. Gentleman goes on:
"After very careful consideration, therefore, the Government have concluded that the refusal of my authorisation to build the West Dock will not affect the overall growth prospects of the Region."
What we have here is the Minister, quite openly and frankly, saying, "I know better than the Regional Council."
Mr. Palmer: Why should he not?
Mr. Emery: If the hon. Gentleman takes that view, perhaps he believes that

169
the Minister should say, "To hell with the Economic Planning Council. Let its recommendations go to blazes and its 30 members go home."
I have initiated debates in the House on the Tress Report, when the Government have said that they were considering its recommendations. At no time have they said that they had no intention of accepting them. This is why I condemn the Government. I admit that it was a different Ministry answering at that time, but it was the same Minister and I give him credit for being frank and honest, which is more than we have had from other Ministers. At least he said, "No. We in Whitehall know better than the people on the spot who have made these recommendations after studying the matter for 2½ years."
It should be made clear that this matter does not affect only Bristol. It concerns the other conurbations throughout the link to North Devon into Exeter. Certain industrialists have been considering the provision of employment in this part of Devon in the belief that this scheme would go forward.
I find the Minister's argument for using the discount cash flow technique rather strange. One must consider not only the rate of return which would benefit Bristol, but the return for the south-west region as a whole. I find it strange to learn from hon. Members who represent Bristol that they are willing to go forward with this £15 million project on an entire private stock issue, so that the money will be provided by industry. We should remember, therefore, that industry which wants this stock can come forward with the money. That being so, this does not fall into the normal category of public expenditure with which, in any event, the Government has been too generous. In this case a local authority is asking the Minister to allow industry to find the money to finance a project that industry wants. For this reason the Minister should not be allowed to reject the proposal.
I am perturbed at the squabbling with Wales that has gone on. It seems a non sequitur. If the trade at Bristol docks increased by 8 million to 12 million tons in the next three or four years, that would represent an increase of l½ per cent. in the total volume of traffic throughout the country. Thus, this is
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not of such major importance merely to Wales. It affects the south-west region as a whole.
People want to use the smaller ports away from London and Liverpool. I speak from experience because in one of my businesses I use Felixstowe, a port of which many people have not even heard. It has easy access and the good labour relations that exist there enable one to operate more quickly and easily than is normally the case in London or Liverpool. For this reason Bristol has much to recommend it.
I do not want the Bill merely to be sent into Committee. It should be placed on the Statute Book immediately. There has already been too much delay and the South-West condemns the Government for constantly fobbing off and postponing good proposals of this type. Let us have an affirmative decision tonight and pass the Bill, rather than merely send it into Committee.
Several hon. Members Several hon. Members rose—
Mr. Speaker: Order. Before I call the next speaker, I remind the House that only 20 minutes remain for the debate. If hon. Members would be brief, both they and the Chair would be grateful.
9.40 p.m.
Mr. Roy Hughes: I am pleased to follow the hon. Member for Honiton (Mr. Emery), who has reiterated the case for the South-West. I am sure that he will not mind if I am as adamant in putting the argument in favour of South Wales.
This is an issue over which much heat has been generated, and Bristol has certainly put up a tremendous fight. Let us be quite clear that it has been completely ruthless in the promotion of its schemes. I compliment my hon. Friends on their efforts to bring the Bristol schemes to fruition—in these arguments no holds have been barred—but they may possibly have tended to underestimate the opposition. After all, Welshmen love a fight. I think that I have played some modest part in harnessing the opposition to this scheme.
In the event, the Government have made a sober decision based on economic facts and financial accountability. That is how any fair-minded person would judge an issue like this. I believe

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the Government's decision to be in line with their declared policy of creating an integrated transport system with the ports organised on the basis of public ownership. Unified control of policy is essential to prevent the continuation of haphazard development, and decisions relating to the ports will affect the wellbeing of the whole colony and can be taken only on the basis of positive central planning.
This manner of thinking is also in line with the whole Severnside project and, as the Minister pointed out in his letter of 5th July to Sir Kenneth Brown, Chairman of the Port of Bristol Authority, the report on that project may not be available before the end of 1969. I feel sure that the Minister will also take into consideration the fact that the coastal strip known as the Wentlooge and Llanwern Flats, east and west of Newport, is one of the three sites in the country at present being considered for major maritime industrial development.
We in Wales have opposed this West Dock scheme as, earlier, we opposed the Portbury scheme. We have throughout maintained that similar facilities could be provided in South Wales more quickly and more efficiently, and at a fraction of the cost. Our opposition goes even beyond that. Our ports suffered with the decline of the coal industry in South Wales, and it is fair to say that we have picked ourselves up by our bootlaces as it were. Great things are at present under way in the South Wales ports. Much credit is due to the British Transport Docks Board for its enterprise and its success in introducing new traffic. New equipment has been introduced to cater for modern needs and requirements.
The Bristol scheme, if it were allowed to proceed, could upset all our efforts. In South Wales we are proud of our ports for they are the arteries of our nation. There are five ports which come under the British Transport Docks Board. Mil-ford Haven is excluded. Those five ports tend to be complementary to each other. In South Wales we have a sort of ports complex on similar lines to London and Merseyside. I am privileged to represent the Port of Newport, a very prosperous and go-ahead town. Its enterprise is shown to no better advantage than in the present development of its
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docks. A few years ago there was the removal of the coal hoists in Newport. This was symbolic of change and the effort to look to the future which is taking place in Newport.
A few months ago I was privileged to be at our docks in Newport when the Prime Minister came to open our new timber terminal. That terminal is the most modern in the United Kingdom, and possibly in Europe. A container terminal is being developed in Newport. I wish many more West Country hon. Members were present to hear this. Both these major schemes in Newport are sound financial propositions. In Port Talbot we have a new terminal going ahead at a cost of £17 million capable of taking vessels of 100,000 tons.
Mr. Speaker: Order. We are discussing the Bristol Bill. The hon. Member must come to it.
Mr. Hughes: I was trying to develop the alternative facilities and better facilities that exist in South Wales. An hon. Member opposite spoke of motorways which link with the Port of Bristol. In South Wales we have not been lagging behind in this matter. Newport is in closer reach of Britain's major centres of population, industry and commerce. For example, nearing completion is the Ross Spur, which will give direct access to the M5 and Birmingham. The M4—
Mr. Speaker: Order. The hon. Member must take note of what I said. This is not the Newport Corporation Bill; it is the Bristol Corporation Bill. He must link his remarks to the Bill.
Mr. Hughes: I am sorry, Mr. Speaker, but I felt that we have to put the counter-arguments to the Bristol scheme. It is worth pointing out that Bristol already has a lower percentage of unemployment than the South Wales ports. If this West Dock scheme were to go ahead it could have the effect of intensifying unemployment in South Wales.
The fact has to be faced that this additional traffic is required if Bristol is to make a viable proposition of the new West Dock scheme. This traffic would be obtained at the expense of the South Wales ports. It would create a difficult situation for the British Transport Docks Board for the under-utilisation already of

173
the South Wales ports cannot be too greatly exaggerated. Cardiff's timber trade might well be diverted to Bristol. South Wales exports about 30,000 vehicles a year to the United States from the Midlands and from London. This trade would be equally vulnerable if the Bristol scheme went through. Already there is speculation about Bristol being interested in the steel coil trade. Newport's gross revenue loss as a result would be about £600,000 per annum.
All these developments have involved considerable amounts of capital. It has been said that the Portbury scheme and other Bristol schemes were being thought out when people in South Wales were asleep in their beds. Since the South Wales ports were nationalised in 1948, £23 million has been invested in them and a further £11 million is in the process of being spent. That excludes the Uskmouth scheme at a cost of £8 million, which is the subject of review at present.
Mr. Wilkins: Does my hon. Friend want to stop this scheme?
Mr. Hughes: I would like the House to bear in mind, too, that—
Mr. Robert Cooke: Other hon. Members want to speak.
Mr. Hughes: —when the Rochdale investigations were carried out, the South Wales ports were inclined to be dead or in the doldrums and certainly were financial losers. This is not so today. Bristol has tried to imply that it is not in direct competition with South Wales. We believe that this is not so. Bristol has indicated that South Wales is concerned only with primary products. Again this is not so. I cite the timber trade, motor cars and steel coils. This is the trade which the Port of Bristol must attract if the West Dock scheme is to be made a viable proposition.
If the Government had given Bristol the go-ahead and if the scheme had succeeded, all that Wales would have got out of it would have been the crumbs from the rich man's table. Alternatively, if the scheme goes ahead and if it fails, this will be disastrous to the nation and, perhaps even more so, to the ratepayers and citizens of Bristol. [HON. MEMBERS: "Nonsense."] Above all, it would throw into jeopardy all the patient efforts of
174
South Wales to build a modern ports system. Bristol already has a good and efficiently run docks. There is a tendency to under-estimate this. It has been said that Bristol is at present working to capacity. I understand that this is the subject of dispute, because the shift system at Bristol is not being fully utilised. Bristol is the centre of a vast and growing sub-region. The same cannot be said of Wales at present, though our prospects are bright.
In conclusion, we are glad that the Minister has based his decision on ordinary financial and economic criteria. We in Wales are united in our opposition to the scheme.
9.54 p.m.
Mr. R. F. H. Dobson: I very much regret, as many other Members, including those from Bristol, do, the fact that South Wales Members of Parliament are against the Bill for their own reasons. My hon. Friend the Member for Newport (Mr. Roy Hughes) took the main accolade of pleasure to himself. His attitude will be bitterly resented by many Labour supporters and others in Bristol.
My complaint about the Government's opposition to the Bill is relatively simple. First, I complain very much that we have not been given the facts which we are entitled to have before making a decision on the matter. This is disgraceful. For many months the Government have said that their figures are right, the Port of Bristol has said that its figures are right, and two or three other bodies, including the National Ports Council, have claimed that their figures are right.
Why is the White Paper which we discussed with Ministers and others before the Easter Recess not available? I am sorry to say to my right hon. Friend the Minister that I did not like his statement on Friday, and I did not like the fact that those of us who had been intimately involved were not given a copy. It would have helped us to give some thought to the matter over the weekend. I was abroad on Parliamentary business and those of us who were not in London had no knowledge of this. I did not know until I returned to the United Kingdom.
Mr. Marsh: I apologise to my hon. Friend. All hon. Members concerned

175
were written to, and if the hon. Member was not available for reasons which are perfectly legitimate—
Mr. Dobson: My hon. Friends tell me that they have not received it. I hope that the Minister will take this as a criticism. I am sorry to have to speak in such blunt terms, but it is a very fair point.
The matter will not be closed entirely unless the Bill is voted out. If the Bill goes to Committee we would at least have a chance to consider further information. My right hon. Friend must realise that his decision is being looked at very unfavourably, to put it at its mildest, by the people of Bristol. They are not convinced by the facts and figures which he has presented. They are proud of their port; they are proud of it as a municipal undertaking and proud of the public control they have over it. They feel strongly about the loss of the opportunity to develop.
My right hon. Friend cannot have it both ways. He cannot, as he did in the Adjournment debate of my hon. Friend the Member for Bristol, Central (Mr. Palmer) say that if there is no development the port will stultify, and then today say that this is not the end of Bristol docks. Of course, it is not the end of Bristol docks, but it is the end of the logical development in Bristol docks
which the local people can see. I hope that the Minister will think again and not oppose the Bill.
9.57 p.m.
Mr. Donald Anderson: It is sad that the debate has shown a rivalry between the two sides of the Bristol Channel when they should be working in co-operation. On the whole, the Government are right in turning down this piecemeal approach, but I appeal to them to press forward as soon as they can with a comprehensive ports development for the whole of the Bristol Channel. If we do not work together, the alternative is that we shall lose together.
The Bristol Channel has very much to offer in terms of national ports development because of the congestion of the English Channel and our proximity to the major American market. I appeal to my colleagues on both sides of the Channel and to the Minister to push this as far as they can. We must try to see that the things that we have in common work together for our mutual benefit, and prevent the piecemeal schemes which I believe the Minister was right to shoot down both on ports grounds and on national economic grounds.
Question put, That the Bill be now read a Second time:—
The House divided: Ayes 63, Noes 166.

Division No. 270.]

AYES

[10.0 p.m.

Allason, James (Hemel Hempstead)

Hunt, John

Sharples, Richard

Awdry, Daniel

Irvine, Bryant Godman (Rye)

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

Bennett, Sir Frederic (Torquay)

Jopling, Michael

Sinclair, Sir George

Biggs-Davison, John

Kimball, Marcus

Smith, Dudley (W'wick & L'mington)

Brewis, John

Longden, Gilbert

Stainton, Keith

Cooper-Key, Sir Neill

Loveys, W. H.

Teeling, Sir William

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

MacArthur, Ian

Turton, Rt. Hn. R. H.

Dobson, Ray

Macmillan, Maurice (Farnham)

Vickers, Dame Joan

Doughty, Charles

Maddan, Martin

Walker, Peter (Worcester)

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

Maginnis, John E.

Walters, Dennis

Eden, Sir John

Maude, Angus

Ward, Dame Irene

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

Monro, Hector

Weatherill, Bernard

Ellis, John

More, Jasper

Wells, John (Maidstone)

Emery, Peter

Morrison, Charles (Devizes)

Whitelaw, Rt. Hn. William

Eyre, Reginald

Munro-Lucas-Tooth, Sir Hugh

Wilkins, W. A.

Fraser, John (Norwood)

Osborn, John (Hallam)

Wills, Sir Gerald (Bridgwater)

Gresham Cooke, R.

Palmer, Arthur

Wilson, Geoffrey (Truro)

Halt-Davis, A. G. F.

Pearson, Sir Frank (Clitheroe)

Younger, Hn. George

Hamilton, Michael (Salisbury)

Peel, John

Harrison, Col. Sir Harwood (Eye)

Percival, Ian

TELLERS FOR THE AYES:

Heseltine, Michael

Rodgers, Sir John (Sevenoaks)

Mr. Robert Cooke and

Hiley, Joseph

Royle, Anthony

Mr. Paul Dean.

Hornby, Richard

NOES

Allaun, Frank (Salford, E.)

Atkinson, Norman (Tottenham)

Blackburn, F.

Anderson, Donald

Bagier, Gordon A. T.

Blenkinsop, Arthur

Armstrong, Ernest

Barnett, Joel

Booth, Albert

Atkins, Ronald (Preston, N.)

Bessell, Peter

Boyden, James

Braddock, Mrs. E. M.

Howie, W.

O'Malley, Brian

Bray, Dr. Jeremy

Huckfield, Leslie

Orme, Stanley

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

Hughes, Roy (Newport)

Oswald, Thomas

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

Hunter, Adam

Page, Derek (King's Lynn)

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

Hynd, John

Pannell, Bt. Hn. Charles

Buchan, Norman

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

Park, Trevor

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

Janner, Sir Barnett

Parkyn, Brian (Bedord)

Butler, Herbert (Hackney, C.)

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

Pearson, Arthur (Pontypridd)

Callaghan, Rt. Hn. James

Jones, Dan (Burnley)

Peart, Rt. Hn. Fred

Cant, R. B.

Jones, J. Idwal (Wrexham)

Pentland, Norman

Carmichael, Neil

Judd, Frank

Perry, George H. (Nottingham, S.)

Carter-Jones, Lewis

Kenyon, Clifford

Rees, Merlyn

Coe, Denis

Lawson, George

Reynolds, Rt. Hn. G. W.

Coleman, Donald

Leadbitter, Ted

Rhodes, Geoffrey

Concannon, J. D.

Lee, Rt. Hn. Frederick (Newton)

Roberts, Gwilym (Bedfordshire, S.)

Crawshaw, Richard

Lestor, Miss Joan

Robertson, John (Paisley)

Crossman, Rt. Hn. Richard

Lewis, Ron (Carlisle)

Robinson, Rt. Hn. Kenneth (St.P'c'as)

Cullen, Mrs. Alice

Lomas, Kenneth

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

Dalyell, Tam

Luard, Evan

Roebuck, Roy

Davies, Ednyfed Hudson (Conway)

Lyons, Edward (Bradford, E.)

Rose, Paul

Davies, s. O. (Merthyr)

McCann, John

Ross. Rt. Hn. William

Dempsey, James

MacColl, James

Rowlands, E. (Cardiff, N.)

Dewar, Donald

MacDermot, Niall

Sheldon, Robert

Doig, Peter

Macdonald, A. H.

Shore, Rt. Hn. Peter (Stepney)

Dunn, James A.

McGuire, Michael

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

Eadie, Alex

Mackenzie, Gregor (Rutherglen)

Silkin, Rt. Hn. John (Deptford)

Ennals, David

Mackie, John

Silverman, Julius

Ensor, David

Maclennan, Robert

Slater, Joseph

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

McMillan, Tom (Glasgow, C.)

Snow, Julian

Faulds, Andrew

McNamara, J. Kevin

Spriggs, Leslie

Fernyhough, E.

Mahon, Peter (Preston, S.)

Steel, David (Roxburgh)

Fitch, Alan (Wigan)

Mahon, Simon (Bootle)

Steele, Thomas (Dunbartonshire, W.)

Fletcher, Ted (Darlington)

Mallalieu, E. L. (Brigg)

Summerskiil, Hn. Dr. Shirley

Forrester, John

Manuel, Archie

Thomas, Rt. Hn. George

Fowler, Gerry

Marks, Kenneth

Thornton, Ernest

Freeson, Reginald

Marsh, Rt. Hn. Richard

Tinn, James

Galpern, Sir Myer

Mason, Rt. Hn. Roy

Urwin, T. W.

Gower, Raymond

Mendelson, J. J.

Varley, Eric G.

Gray, Dr. Hugh (Yarmouth)

Millan, Bruce

Wainwright, Edwin (Dearne Valley)

Grey, Charles (Durham)

Miller, Dr. M. S.

Wallace, George

Griffiths, Eddie (Brightside)

Milne, Edward (Blyth)

Wells, William (Walsall, N.)

Griffiths, Rt. Hn. James (Llanelly)

Moonman, Eric

Whitaker, Ben

Hamilton, James (Bothwell)

Morgan, Elystan (Cardiganshire)

White, Mrs. Eirene

Hamling, William

Morgan, Geraint (Denbigh)

Williams, Clifford (Abertillery)

Hannan, William

Morris, Alfred (Wythenehawe)

Wilson, William (Coventry, S.)

Harper, Joseph

Morris, Charles R. (Openshaw)

Winnick, David

Harrison, Walter (Wakefield)

Morris, John (Aberavon)

Winstanley, Dr. M. P.

Hattersley, Roy

Moyle, Roland

Yates Victor

Hazell, Bert

Murray, Albert

Hobden, Dennis (Brighton, K'town)

Neal, Harold

TELLERS FOR THE NOES:

Hooley, Frank

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

Mr. Ernest G. Perry and

Houghton, Rt. Hn. Douglas

Oakes, Gordon

Mr. Neil McBride.

Howarth, Robert (Bolton, E.)

Ogden, Eric

SELECTIVE EMPLOYMENT PAYMENTS
10.8 p.m.
The Undersecretary of State for Employment and Productivity (Mr. Roy Hattersley): I beg to move,
That the Selective Employment Payments Variation Order 1968, a draft of which was laid before this House on 30th May, be approved.
This is a comparatively simple Order. The Government promised to keep the working of the Selective Employment Tax under review when the tax was introduced in the House two years ago. A number of major modifications in its incidence have already been introduced. This draft Order deals with the activities on which the tax falls as initially defined by the Standard Industrial Classification.
178
Under the Standard Industrial Classification, all slaughterhouses are classified under a distributive heading. Most private slaughterhouses have, therefore, borne Selective Employment Tax without refund. Local authority slaughterhouses, however, have been treated like most other local authority services; they always receive payments equivalent to refund of the tax.
My hon. Friend the Member for Willesden, West (Mr. Pavitt), reminding us, as he so often does, of important Co-operative interests, and the hon. Member for Bromsgrove (Mr. Dance) have drawn the attention of the House on many occasions to the anomaly created by this situation. Put simply, it has meant that municipal slaughterhouses have been treated more favourably than those run privately or by Co-operative Societies.

179
The Order provides that licensed private sector slaughterhouses and knackers' yards shall, subject to the usual conditions, be eligible for registration under Section 1 of the Selective Employment Payments Act. As a result, outside the development areas all slaughterhouses, public and private alike, will receive refund of the tax. In development areas, private slaughterhouses will receive the regional employment premium.
The second change made by the Order is intended to remedy another anomaly. Under a decision taken in another place, the testing of goods for manufacturers is eligible, as part of the manufacturing process, for refund of the tax under Section 1 of the Act. However, an earlier decision affecting Lloyd's Testing House ruled that in another context testing designed to ensure that materials conformed with statute laid down by Act of Parliament was not itself manufacture. An industrial tribunal subsequently applied this ruling to Selective Employment Tax. It is clearly right that the two forms of testing should be on the same basis and the Order achieves that result. Both types of testing will be treated as part of the manufacturing process.
The cost of these two changes will be about £650,000 in a full year at the proposed new rate of tax, which comes into effect on 2nd September. The Order is not and cannot be retrospective. My right hon. Friend proposes that these changes should take place at the earliest possible opportunity and, subject to the approval of the House, they will be effective on 5th August.
Article 3 of the Order is designed to simplify the arrangements by which refunds on the tax are made to certain charities and local authorities. Section 2 of the Act makes the Minister of Agriculture responsible for making payments to agricultural charities. From 2nd September, that responsibility will be
180
taken over by my right hon. Friend. Charities will then receive all their refunds from a single source. At the same time, the Department of Employment and Productivity will relinquish its powers to make certain payments relating to activities falling under the Standard Industrial Classification headings listed in Section 2 of the Act to local authorities in Scotland and in England and Wales, and that duty will be taken over by the Minister of Housing and Local Government in England and by the appropriate Secretary of State in Scotland and in Wales. The net effect of this part of the Order is that charities and local authorities will then receive refund from one Government Department rather than two.
Some changes in the Selective Employment Tax classification have, of course, already been made as a result of decisions by industrial tribunals or higher courts. My Department has frequently advised that classification should be tested in this way and there have been numerous occasions on which, the first test having shown the equity of reclassification, the Government have accepted that judgment without mounting the appeal which is open to us. The general question of classification of particular activities for S.E.T. purposes will be kept under review.
Mr. Speaker: The Minister must not widen the debate on his own Order.
Mr. Hattersley: Tonight, I simply ask the House for approval to a specific but important reclassification embodied in the Order.
Question put and agreed to.

ADJOURNMENT
Resolved, That this House do now adjourn.—[Mr. Ernest G. Perry.]
Adjourned accordingly at fourteen minutes past Ten o'clock.

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  GREECE
  GREECE
  ADEN (BRITISH OFFICIALS' PENSION RIGHTS)
  ADEN (BRITISH OFFICIALS' PENSION RIGHTS)
  CHEMICAL AND BIOLOGICAL WARFARE
  CHEMICAL AND BIOLOGICAL WARFARE
  SUEZ CANAL (STRANDED SHIPS)
  SUEZ CANAL (STRANDED SHIPS)
  RHODESIA
  RHODESIA
  ARGENTINA
  ARGENTINA
EMPLOYMENT AND PRODUCTIVITY
  Stock Exchange and Finance Houses (Employees)
  Stock Exchange and Finance Houses (Employees)
  Municipal Transport (Wages Settlement)
  Municipal Transport (Wages Settlement)
  British Steel Corporation (Clerical Workers)
  British Steel Corporation (Clerical Workers)
  Company Directors' Salaries
  Company Directors' Salaries
  Employment
  Employment
  10th and 11th Hussars (Amalgamation)
  10th and 11th Hussars (Amalgamation)
  Arley and Kingsbury Collieries (Redundancies)
  Arley and Kingsbury Collieries (Redundancies)
NATIONAL FINANCE
  Government Offices (Northern Region)
  Government Offices (Northern Region)
  Incomes
  Incomes
  Interim Budget
  Interim Budget
  Balance of Payments
  Balance of Payments
  International Loans
  International Loans
  Inland Revenue (Valuation Staff)
  Inland Revenue (Valuation Staff)
ECONOMIC AFFAIRS
  Bus disputes, Wirral and Liverpool
  Bus disputes, Wirral and Liverpool
  Import Control (Prior Deposits System)
  Import Control (Prior Deposits System)
SCOTLAND
  Crimes of Violence
  Crimes of Violence
  Rate Support Grants (Glasgow)
  Rate Support Grants (Glasgow)
  South-East of Scotland Water Board (Charges)
  South-East of Scotland Water Board (Charges)
  Fishing Industry (Seal Damage)
  Fishing Industry (Seal Damage)
  Fish Imports
  Fish Imports
COAL
  Colliery Closures
  Colliery Closures
MINISTRY OF POWER
  Steel, Coal and Shipping (Statistics)
  Steel, Coal and Shipping (Statistics)
BOARD OF TRADE
  Export Order to Greece
  Export Order to Greece
  Exports and Imports
  Exports and Imports
  Retail Prices
  Retail Prices
  Aluminium Smelters
  Aluminium Smelters
  General Agreement on Tariffs and Trade (Waivers)
  General Agreement on Tariffs and Trade (Waivers)
  Overseas Students (Training)
  Overseas Students (Training)
  Industrial Development Certificates
  Industrial Development Certificates
COMMONWEALTH AFFAIRS
  Tanzania
  Tanzania
WALES
  Prince of Wales (Investiture)
  Prince of Wales (Investiture)
  Town Development Act 1952
  Town Development Act 1952
AGRICULTURE, FISHERIES AND FOOD
  Deep-Sea Fishing Industry
  Deep-Sea Fishing Industry
  RHODESIA
  RHODESIA
MINISTRY OF DEFENCE
  Fishing Nets (Mines and Bombs)
  Fishing Nets (Mines and Bombs)
EDUCATION AND SCIENCE
  Pott Shrigley School, Cheshire
  Pott Shrigley School, Cheshire
MINISTRY OF HEALTH
  National Health Service Expenditure, Wales
  National Health Service Expenditure, Wales
  Health and Welfare Expenditure, Wales and Monmouth
  Health and Welfare Expenditure, Wales and Monmouth
  Blind (Certification)
  Blind (Certification)
HOME DEPARTMENT
  Police Services, Wales (Expenditure)
  Police Services, Wales (Expenditure)
  Forms (Welsh Language)
  Forms (Welsh Language)
HOSPITALS
  Consultants (Terms of Service)
  Consultants (Terms of Service)
  Hospital Price Index
  Hospital Price Index
HOUSING
  Council House Rents, Lambeth
  Council House Rents, Lambeth
LOCAL GOVERNMENT
  Thames Barrage (Feasibility Study)
  Thames Barrage (Feasibility Study)
  Irchester, Northamptonshire (Sewerage System)
  Irchester, Northamptonshire (Sewerage System)
  Town Development Schemes
  Town Development Schemes
PUBLIC BUILDING AND WORKS
  Departmental Offices
  Departmental Offices
SOCIAL SECURITY
  Supplementary Benefits, Norwich
  Supplementary Benefits, Norwich
  Administrative Costs
  Administrative Costs
  Social Security Offices, Rugby and Coventry (Amalgamation)
  Social Security Offices, Rugby and Coventry (Amalgamation)
  Social Security Offices (Caller Status)
  Social Security Offices (Caller Status)
TECHNOLOGY
  Fish Preservation (Irradiation Trials)
  Fish Preservation (Irradiation Trials)
RAILWAYS
  Victoria Line and Projected Fleet Line (Link)
  Victoria Line and Projected Fleet Line (Link)
MINISTRY OF TRANSPORT
  Driving Test Charge
  Driving Test Charge
  London Transport (Concessionary Fares)
  London Transport (Concessionary Fares)

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

DEPARTMENTAL COMMITTEES
LORD MITCHISON: 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 why they have lost count of the Departmental Committees about which they were asked on May 8.]
LORD BESWICK: My Lords, the Government do not purport to keep any centralised count of all the Committees appointed by all the Government Departments. It has been explained to my noble friend that the cost of the research involved in providing a precise Answer to his somewhat widely drawn Question could not be justified.
LORD MITCHISON: My Lords, if my noble friend, whom I would thank for his Answer, is referring to another Question on the Order Paper, he might put his Answer to that. On the other hand, do I understand him to be saying that he has never lost count because he has never kept count?
LORD BESWICK: My Lords, my noble friend hay grasped the situation perfectly.
LORD MITCHISON: 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 the Treasury or some other Department will assume the responsibility of keeping a list of Departmental Committees and keeping it up to date.]
LORD BESWICK: My Lords, such a list would serve no useful management function.
LORD MITCHISON: My Lords, I should like to thank my noble friend again with particular warmth for the Answer he has given. May I ask whether it has occurred to him that it might impress Parliament to know how many Departmental Committees there are and what they are doing? These Departmental Committees cost money, and involve the expenditure of a certain amount of Civil Service time, all matters that Parliament is entitled to inquire into. In order to answer inquiries, would it not be advisable to keep a short list?
LORD BESWICK: My Lords, I quite agree with my noble friend that it would be advisable to keep a short list, were that possible. But if the list chat is envisaged were to include all the Committees set up by all Departments it would not be a short one. The P.E.P. did some research on this, I think in 1951, and at that time it was found on their count that there were no fewer than 850 advisory committees alone. The list covered some 50 pages; there were 9,000 members, and, of course, so far as the Departments were concerned, all the Committees were necessary. I would say to my noble friend that if he could define his Question more closely and limit the scope along the lines suggested to him, for example, to committees of inquiry in a limited number of Departments, we should be happy to try to find the answer for him.
LORD MITCHISON: My Lords, may I say that I suggested a rather simplified version, and I asked the official I saw to take my suggestion away. He took it away, and I have heard no more since. What is the use of making suggestions if you never get an answer to them?
LORD CONESFORD: My Lords, is the Minister aware that it would be even more useful if the Government kept some count of the number of Ministers?

TELEVISION COVERAGE IN THE SCOTTISH HIGHLANDS
2.40 p.m.
THE DUKE OF ATHOLL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what plans there are for extending television coverage in the Highlands of Scotland, and whether the V.H.F. bands in those mountainous areas will be permanently retained.]
LORD BOWLES: My Lords, I apologise for the length of this Answer. The extension of the population coverage attained by their television transmissions is primarily a matter for the B.B.C. and the I.T.A. The coverage attained by B.B.C. 1, transmitted on V.H.F. and on the 405-line definition standard, has virtually reached its practical limit. For the I.T.A.'s service, also transmitted on V.H.F. and 405 lines there is the prospect of a small extension of coverage.
B.B.C. 2, transmitted on U.H.F.—ultrahigh frequency—and 625 lines, will be brought into the Highlands by low-powered stations relaying the signal from the main stations; and, so far, main stations in the vicinity of the Highlands are in service or planned at Durris, Angus, Craigkelly, Dunbarton and Rosemarkie. It is too soon to say what the pattern of relay stations will be. The duplicate transmission of B.B.C. 1 and Independent Television, also on 625 lines, will use the B.B.C. 2 pattern of stations generally. Again, it is too soon to say what frequencies relay stations bringing the B.B.C. 2 and duplicate services to the Highlands would use. In announcing the decision to authorise the B.B.C. and I.T.A. to undertake the duplication on 625 lines of their 405-line services, the then Postmaster General said on February 15 last year that the 405-line transmissions on V.H.F. would continue to go out for as long as was reasonably necessary, and that might mean a number of years.
THE DUKE OF ATHOLL: My Lords, I should like to thank the noble Lord, Lord Bowles, for his extensive Answer, which I much appreciate. At the same time, I should like to ask whether he is
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aware that there is great worry among some people living in the very remote parts of the Highlands that when B.B.C. 1 is converted from V.H.F. 405 lines to U.H.F. 605 lines, they may no longer be able to receive it, as the U.H.F. lines will not bend to the same extent as the V.H.F. lines? Can the noble Lord give an assurance that the 405 lines service on V.H.F. will be kept going until the 625 lines service U.H.F. covers every single homestead which at the moment is able to receive the V.H.F. service.
LORD BOWLES: My Lords, the answer to the first part of the noble Duke's question is that the B.B.C. and I.T.A. are, of course, well aware that in general U.H.F. transmissions do not attain the same coverage as comparable V.H.F. transmissions. As I have said, it is too soon to say what relay stations will be needed and what frequencies will be used. Regarding the second part of the question, perhaps the noble Duke and I could have a word together afterwards with one of my advisers, because this matter is rather above my head.
THE DUKE OF ATHOLL: My Lords, does the noble Lord, Lord Bowles, appreciate that, in common with him, it is rather above my head, too, and that I had to have a little tuition on this before I asked the Question?
LORD BOWLES: My Lords, perhaps the noble Duke would meet me immediately after Questions.

NIGERIA: UNITED NATIONS AND AID TO BIAFRA
LORD ROWLEY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what extent the United Nations and the World Health Organisation are co-operating in the bringing of food and medical aid to the Ibo region of Nigeria.]
THE MINISTER OF STATE FOR COMMONWEALTH AFFAIRS (LORD SHEPHERD): My Lords, Nigeria is a member of the United Nations and any approaches the Nigerian Government may have made to the United Nations and

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World Health Organisation on the question of relief is entirely a matter for them. The extent to which these and other organisations may take part in relief operations will, of course, be taken into account by the noble Lord, Lord Hunt, when he reports to the British Government about the whole relief situation and the best way we ourselves can help.
LORD ROWLEY: My Lords, in view of the statement made last week by Mr. Heinrich Jaggi, the chief delegate of the International Red Cross, that unless a massive airlift of foodstuffs and drugs was carried to Biafra within the next two months perhaps two million people, mostly women and children, might die of starvation, should not the United Nations organise an international relief operation? If so, would Her Majesty's Government indicate to the General Secretary, Mr. U Thant, that if this operation were organised within the framework of the United Nations Charter Her Majesty's Government would give the United Nations their fullest co-operation in the matter, so as to avert what might well be a holocaust of deaths and human suffering?
LORD SHEPHERD: My Lords, as my noble friend is aware, Nigeria is a member of the United Nations, and in the first instance it would be for them to approach the United Nations. I have not the slightest shadow of doubt that, if such an approach were mooted, the United Nations would be ready to respond.
LORD BROCKWAY: My Lords, may I ask my noble friend: is it not desirable that we should get above these legalistic considerations when 3,000 people are dying every day and one million people are expected to die in the next month? Is this not a world calamity and ought not the Security Council of the United Nations to be using both the World Health Organisation and the World Food Organisation to relieve it?
LORD SHEPHERD: My Lords, I believe that my noble friend intends to ask a Question later in the day. I beg him to remember that Nigeria is a sovereign country and we have to be very careful about attempting to impose a colonialistic approach on an independent country. It is for the Government of
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Nigeria to approach the United Nations and then, as I said, I have not the slightest shadow of doubt that the United Nations would respond.
LORD BROCKWAY: And let all the people die in the meantime.
LORD ROWLEY: My Lords, while appreciating the legalistic position, is there any reason why the United Nations, through their Secretary-General, should not offer to the Government of Nigeria to organise this great airlift, which would not be inconsistent with the independence recognised in Article 2(7) of the Charter?
LORD SHEPHERD: My Lords, certainly it would be open to the United Nations, as to any other country, to make offers of assistance to the Government of Nigeria. If such an offer were to be made by the United Nations organisations I am sure it would be considered with the greatest sympathy and urgency by the Federal Government.
BARONESS SUMMERSKILL: My Lords, as we are a powerful member of the World Health Organisation and as from time to time that organisation have offered their services to different nations, either to prevent certain diseases or to help the fight against them why cannot they offer their services in this case and why cannot we take the initiative?
LORD SHEPHERD: My Lords, there is another Question coming later and it might be easier to answer that supplementary then. But in the end it is the responsibility of the United Nations, if they should so wish, to make an approach, or the responsibility of the Federal Government, if they so wish, to approach the United Nations for assistance.
BARONESS SUMMERSKILL: My Lords, may I ask my noble friend why cannot we take the initiative, as we have before?
LORD SHEPHERD: My Lords, I suggest that there is some difference between taking the initiative in asking the United Nations to intervene when a catastrophe has arisen as the result of plague or disease and asking the United Nations to intervene in what is unfortunately a civil war in a sovereign State.
BARONESS SUMMERSKILL: Disease and starvation!
LORD SHEPHERD: My Lords, these have arisen by an act of civil war.
LORD RITCHIE-CALDER: My Lords, may I ask my noble friend whether there has not been a number of similar situations, in which the World Health Organisation and UNICEF did exactly, and very effectively, what we are now asking?
LORD WILLIS: My Lords, would my noble friend not agree, in view of the fact that the Belgian Government has decided to suspend the sale of arms to Nigeria, that this country should do the same and should concentrate on making an advance to the United Nations along the lines suggested?
LORD SHEPHERD: My Lords, I think the noble Lord is abusing the rules of this House, because that is definitely another question.
LORD REA: My Lords, referring to the noble Lord's reference to the airlift, would he bear in mind—I am sure he will, because he bears everything in mind—that during the last war every occupied territory was supplied by parachute with thousands of tons of supplies. I believe that he said recently that it would be only scratching the surface to send in parachute supplies. Might I ask him to give this matter careful consideration?
LORD SHEPHERD: My Lords, I would say to the noble Lord that that is another question. It does not directly arise from the Question on the Order Paper. My noble friend Lord Brockway is asking a Question later and perhaps a reply to the last supplementary should go with the answer to that.

BUSINESS
2.50 p.m.
LORD BROCKWAY: My Lords, I beg leave to ask Her Majesty's Government a Question of which I have given them Private Notice: namely, what action is being taken to meet the refusal of the Nigerian Federal Government to allow relief by airlift to the hungry thousands in Biafra?
LORD BESWICK: My Lords, my noble friend Lord Shepherd will be answering this Question at a convenient moment after 3.30 p.m. I shall also be making a Statement on the Central Banks meeting at Basle; and after that there will be a Statement on fisheries policy.
My Lords, I have been provided with a number of rather conflicting estimates as to the time which will be taken by the Town and Country Planning Bill this afternoon. If the Bill finishes before six o'clock, it will leave us in a somewhat difficult situation, since a number of noble Lords involved in the Theatres Bill are now sitting in another room on the Gaming Bill; and the noble Lord, Lord Stow Hill, who is sponsoring the Theatres Bill, cannot be here until six o'clock. In view of this, I hope your Lordships will agree that if we finish the Committee stage of the Town and Country Planning Bill before six o'clock, we should then proceed to the Committee stage of the Friendly and Industrial and Provident Societies Bill, and take the Committee stage of the Theatres Bill after that.
I am aware that this alteration infringes Standing Order No. 34, which provides that the House shall proceed with business in the order in which it stands on the Order Paper. But I hope that, in view of all the circumstances, your Lordships will accept that this alteration is not intended for the convenience of the Government, but to meet with the convenience of all noble Lords involved in their respective Private Members' Bills.
EARL ST. ALDWYN: My Lords, I am grateful to the noble Lord for making that statement. I agree that it is contrary to the Standing Order, but I should have thought that it would definitely be for the convenience of the House that the noble Lord's suggestion should be followed.
LORD BESWICK: My Lords, I am obliged to the noble Earl.
LORD WILLIS: My Lords, may I ask the noble Lord a question on the Business of the House—and I do not know whether this is in order. I am informed that it is possible that the Sunday Entertainments Bill and the Divorce Bill will not go through Parliament in this Session, and the reports are that it is

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because the House of Lords is unable to give time to these small, but very important measures. Is it not possible for this House to consider altering its time of rising, in order that we can assure the Commons that if they pass these Bills and give them time, we can give them time here? Otherwise, they will be lost for this Session, and perhaps for a long time afterwards.
LORD BESWICK: My Lords, my noble friend the Leader of the House dealt last week with one aspect of what the noble Lord has asked—namely, referring to the Divorce Bill—and I have nothing to add to what he told your Lordships.
LORD LEATHERLAND: My Lords, while we are speaking on the Business of the House, may I ask my noble friend whether he has seen reported in the Press this morning a statement by a Member of the other House to the effect that owing to the lethargy of the House of Lords, which he says is only sitting three days a week, a number of Bills are being held up? Can my noble friend arrange for a statement to be made on behalf of this House to indicate the extent to which we are sitting?
THE PAYMASTER GENERAL (LORD SHACKLETON): My Lords, I also saw the statement. Accustomed as we are to slightly off-colour remarks about your Lordships' House from time to time, I tend rather to note these things, and make a mental note to speak to the individual in question and tell him how wholly wrong ha is. I do not think this is a matter on which it would be very profitable for us to go into a debate. It may well be that if noble Lords wish to discuss the Business of the House arrangements could be made; but we have not had any notice of this. Perhaps my noble friend may also wish to correct the remarks of the Member in question.
LORD CARRINGTON: My Lords, bearing in mind that this House is sitting one week longer than another place, some of us might perhaps think it rather unreasonable that the House of Commons should debate all their measures at their convenience, and that we should sit through the rest of the summer debating them here.

PRICES AND INCOMES BILL
2.55 p.m.
LORD BESWICK: My Lords, I beg to move that this Bill be now read a third time. We have had on Second Reading, and again in Committee, a careful and informed scrutiny of this Bill. We have had speeches from a former Chairman of the Trade Union Congress; there has been a contribution from a former General Secretary of the Trades Union Congress, and from my noble friend Lord Blyton, whose roots go deep into the history of one of the most troubled of all our great industries, the mining industry. Then there was the noble Lord, Lord Rowley, who himself and his family know the Labour movement as few families in this country know it. All these noble Lords, with their experience and their connections with the great Labour movement, have shown a sympathy and an understanding of the purposes of the Fill that I have had the privilege of moving before your Lordships' House. I am grateful to those noble Lords, and to noble Lords opposite, for the way in which they have enabled the House to take this Bill through the various stages in this House.
The fact is that the powers in this Bill are an essential part of the post-devaluation economic policy, and with the Finance Bill, which has just received its Third Reading in another place, the passage of this Bill will complete the Budget strategy. The Government have never hidden the fact that this Bill has more stringent powers than existing legislation, which the Bill also renews; but these more stringent powers are warranted by exceptional circumstances. Important as it is, it would be a mistake to assume that the measures in the Bill are everything. It essentially requests fall-back powers for a policy which is designed to encourage and promote cost effectiveness and productivity. I think I can claim that Britain today is more cost and productivity conscious than ever before in its history. At the same time, we have also wanted to ensure fair play, and to spread what rigours there are fairly and with consistency. For this reason, we are asking for certain powers to control rent increases and dividend distributions.

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In conclusion, my Lords, I should like to emphasise once again that these powers are a buttress to the voluntary system. They are not a substitute for the general voluntary acceptance by those of our people (who constitute the majority) who recognise the need for restraint. I ask noble Lords to give a Third Reading to the Bill as one that is necessary as an insurance to the progressive economic recovery of the country.
Moved, That the Bill be now read 3ª.—(Lord Beswick.)
LORD ERROLL OF HALE: My Lords, I do not propose to re-open the arguments on Third Reading about the merits or otherwise of the Bill, although what the noble Lord has just said, including some extraordinary jargon about cost effectiveness or cost and productivity consciousness, was a great temptation to me. We will let that pass. We were delighted to hear the vote of thanks which he gave to noble Lords on his side, but he gave very perfunctory thanks to noble Lords on my side of the House, who have cooperated with him in circumstances of great inconvenience in a procedure which we were assured last year would never be repeated, but which was repeated. We hope that, in giving a Third Reading to this Bill, we can even at this late stage have an assurance that your Lordships' House will not be treated ever again by this Government in such a cavalier way.
LORD BESWICK: My Lords, may I just say that the noble Lord will find when he reads Hansard that I specifically referred to noble Lords opposite. I apologise that I did not say, "the noble Lord, Lord Erroll, and the noble Lord, Lord Drumalbyn."
LORD CLITHEROE: My Lords, I do not propose to make a Third Reading speech on this Bill, but I cannot let the Third Reading go by without saying how entirely out of sympathy I am with this Bill. The compulsory powers in the Bill are, in my opinion, totally incompatible with a free society. I was deeply saddened to hear the views expressed by so many old stalwarts of the Labour movement, who seem to have convinced themselves that compulsion is necessary. I myself believe that we are drifting into very dangerous waters, and those who
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believe in freedom may, I think, very well live to regret the day that this Bill was passed.
3.0 p.m.
LORD BROCKWAY: My Lords. I had tabled an Amendment to this Bill during the Committee stage. For physical reasons I was unable to be here, and I hope the House will therefore permit me to put the considerations which were then in my mind. The principal purpose of that Amendment was to delete the penal section of the 1966 Act, but it would also have deleted other sections relating to the compulsory wage restrictions. I am not against an incomes policy. I should like to see a minimum living standard applied in this country to the aged, the sick, the unemployed and the injured. I should like to see in this country a minimum wage of £15 for all workers. I should like to see a limit to the maximum income of the citizens of this country. Away in the 1920's I stood for these principles. But I am opposed to the actual proposals in this Bill for income limitation.
The Government say that prices will rise by 5 per cent. Mr. George Woodcock, the Secretary of the Trades Union Congress, has said that they will rise by 7 per cent. Under this Bill wage increases are limited to 3½ per cent., except where they are attached to productivity agreements. About the need for greater production there is no difference of opinion, but thousands of workers in this country are unaffected by any possible productivity agreements. In this situation it is inevitable that industrial unrest will grow, with prices increasing more than wages, and my great fear is that the cleavage between the trade unions in this country and the Government will grow.
I will now speak for a moment to the members of my own Party. I am deeply concerned by the present rift in the Labour movement. Sixty-one years ago, on the same day, I joined the Labour Party, my trade union and the Co-operative Movement, and I have always regarded them as a tripartite unity. As one who has mostly been engaged on the political side I want to pay my tribute to the Trades Union Congress and to trade union leaders for their attitude to the particular problem which we are now

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discussing. The Trades Union Congress and the Trade Union Conference of Executives agreed to give voluntary cooperation to the Government in preventing unreasonable increases in wages. They also put forward a constructive policy of economic advance. As one who has had a life-time in the Labour movement, I regard it as most unfortunate that the Government did not accept these approaches which the Trades Union Congress put forward. I have not the least doubt that the actual results would have been better, industrial tensions would have lessened, and certainly there would have been a better spirit of co-operation between the trade unions and the Government.
I am particularly concerned about the penal clause in the Prices and Incomes Bill. Section 16(4) of the 1966 Act applies to any Made union or other person taking, or threatening to take, any action by way of taking part, or persuading others to take part, in a strike in pursuance of demands not authorised by the Act. The union or the individual concerned is made liable, on summary conviction, to a fine of £100, or on conviction on indictment to a fine (if the offender is not a body corporate) of £500. I acknowledge that this section does not directly provide for imprisonment, but if the fine was not paid, distraint on the offender's goods or imprisonment would inevitably follow. One can imagine the indignation and indeed the resistance from trade unionists which the application of this section would arouse.
I appreciate that this provision, although included in the 1966 Act, has never been applied. I am confident that the Minister for Employment and Productivity, for whom I have the greatest admiration, would never wish to apply it. But the action is made more likely under the wage restrictions of the Bill which we are now considering, and trade unions have made their resentment clear. Not only the Trades Union Congress but the Conference of the Trade Union Executives—and not only these, but every trade union conference which has met since the White Paper was published—the shop workers, the clerical workers, the engineers, the draughtsmen, even the local government officers, conservative as they are—have condemned this penal clause.
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On this matter the precedents are not encouraging. I remember the circumstances during the war in reference to Order 1305 which prohibited strikes. The Kentish miners at Betteshanger went on strike. The Government decided to prosecute them; there were 4,000 on strike, and the Miners' Union co-operatively agreed that there should be a few test cases. The chairman and the secretary of the Betteshanger branch of the Union were imprisoned. They were close friends of mine, and I was intimately concerned in this issue. When they were imprisoned the consequence was that the minors continued the strike with more determination than ever, the Ministers of the Crown had to negotiate with the imprisoned officers for the men to return to work. There were still difficulties in the judicial field. The Minister of Mines had to consult with the Home Secretary as to how to get the chairman and the secretary out of prison in order that the strike might end, a humilitating experience for any Government.
After the war there was a great campaign against Order 1305. My friends on these Benches will remember the mass strike by the dockers, and again when their leaders were in prison the strike continued with greater determination than ever. I would respectfully warn the Government that if this penal clause is applied the resistance of the rank-and-file workers will become more intense if their leaders are imprisoned.
I want to give one other instance, which is fantastically Irish. The Government of Eire recently passed legislation outlawing strikes in the electricity services. They fined strikers and when they did not pay imprisoned the leaders. The whole electricity industry then threatened to go on strike. A situation developed where the Electricity Board paid the strikers' fines in order to free the leaders from prison. They saw the leaders in prison and the men said, "We do not want to leave now; we have no means of travelling home at night". The Electricity Board representatives then said, "For heaven's sake! you must go back. You must be at the power plant to-morrow morning". The Board actually paid for the taxicabs to take the imprisoned leaders home.
All this is utterly humiliating to any Government. It has happened in this

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country; it has happened in Ireland. It will happen whenever any Government attempts to imprison trade union leaders against the determination of the rank and file. I have no doubt that if a similar situation arose in Britain the Minister, with her persuasiveness and her ingenuity, would settle the matter by measures equally unorthodox as those to which I have referred. But would it not be much better that the situation should never arise?
I want to conclude with a philosophic point. This Party stands for democratic socialism, combining personal liberty with a co-operative social order. We stand for that in distinction from the totalitarianism of communism or the corporate state of fascism. The compulsion of workers with the sanctions of fines and imprisonment is alien to the whole concept of libertarian socialism. It is too late to alter this Bill, but I hope that the Government will not renew it after 12 months and that they will reconsider this policy, which is detrimental not only to our relations with the trade unions but to the principles on which our Party is founded.
3.15 p.m.
LORD ROYLE: My Lords, my noble friend has just made a very moving speech, and I suppose with most that he has said I should be in almost complete agreement. The theories which he has mentioned have been the basis of our socialist faith and our socialist understanding for many years. My membership of the Labour Party does not go back as long as that of my noble friend, but now it is more than forty years, and I want to assure him that other people on these Benches are just as worried as he is, although we have taken a very different line. I have not uttered a word during the passage of this Bill until now, but it has been with a very heavy heart indeed that I voted for it, and I would not have done so had it not been for the feeling that this "long-stop" of penalties was a necessity in present circumstances. As I have sat through the debates here and read the debates in another place, obviously I. with many noble Lords on this side of the House, have been very worried indeed.
But this seems to be a necessity of this particular day and these present economic circumstances. I agree with my noble
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friend that one of the terrible things of life in this country to-day is the growth in inequality, and there seems to be a great deal of concentration on setting back and freezing or maintaining where the wages and incomes are the lowest. With him, I should like to see more activity so far as the upper reaches of income are concerned.
The only other thing I want to say is this. In the debates in your Lordships' House and in another place the concentration all the time seems to have been on incomes. This is the Prices and Incomes Bill. We have heard too little about prices. I recognise the difficulties in maintaining low prices, preventing price rises, but it seems to me that income is the main thought and not the prices. The British housewife has not time to go round from shop to shop finding out where prices are the lowest. There should be a greater concentration on the control of prices. The problems would be nothing like so serious, and we should not be so much worried on the incomes side, if a stronger line were taken with prices.
I finish where I began. It is with a very heavy heart that most of us, or all of us, on this side have accepted the terms of this Bill, particularly the penal clauses. We would not have done so had we not felt that the necessity was there, and our great hope is that ere long these clauses can be removed from the legislation.
3.18 p.m.
BARONESS WOOTTON OF ABINGER: My Lords, I should like to strike a more cheerful note. It was a matter of great regret to me that owing to long-standing and unavoidable engagements I was not able to take part in the earlier debates on this Bill. Perhaps in those circumstances your Lordships will not complain if, with due respect to my noble friends Lord Brockway and Lord Royle, and now that the Bill is about to be well and truly launched, I spill a little verbal champagne over it. This Bill is essentially a temporary measure—temporary because it fixes the present structure of incomes with only very moderate scope for variation. I very much hope that the principle which it embodies, together with the Prices and Incomes Board, will become a permanent feature of our economy, and I would say in passing how much I admire the work of the Prices and

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Incomes Board, and particularly the speed and efficiency of its investigations, which I have followed fairly closely.
The pattern of incomes in any community is of vital importance, both socially and economically. It is of social importance because it is the main determinant of the class structure of society and because it sets limits to the scope of individuals in social intercourse; and it is of economic importance because incomes are at once rewards and incentives. For my part, I have never been able to understand why issues of such importance should be left to the private smash-and-grab of the interests most directly concerned. I have never been able to share the prevailing faith in the divine right of collective bargaining, or, more precisely, in the divine rightness of every collective bargain. Still less can I understand how that faith can be reconciled with the principles of Socialism which lay down that communal action and the economic system should be controlled in the interests of all.
Thirteen years ago I published a book which was most unfavourably received, in the course of which I asked why it was that in this field, and in this field alone, we are expected to believe that public issues are best left to organised private interests to determine. It seems extraordinary that in this world and in this day and age, in which we cannot put up a garage in our backyard without planning permission, designed to safeguard our neighbours' amenities, we are allowed, if I may put it this way, to help ourselves to the contents of our neighbours' pockets without let or hindrance.
Since I first broached this subject 13 years ago there has been a great and welcome change of climate. When I appealed that the question of income determination should be part of the substance of politics I got a quite dusty answer in a great many quarters. But I think to-day we can confidently hope that this Bill will guarantee that hereafter in any negotiations affecting wages, salaries or other incomes determination, a seat will be permanently reserved at the bargaining table for the unknown consumer.
3.22 p.m.
LORD CONESFORD: My Lords, I shall detain the House for but short time. The noble Lord, Lord Royle, made one slip in his short and moving speech. I think he said he had voted for this Bill with a very sad heart. I believe he will find that he has not voted for the Bill, because there has never been a Division throughout the course of our proceedings. I greatly welcome that, not because I think it is a good Bill but because I thought that this House was quite right, whatever it thought of the Bill, to allow the Government to have a Bill which they regarded as essential for their economic policy; and I think their responsibility for this Bill and its results should be crystal clear.
The only matter on which I wish to comment is the actual timing of the Bill in its final stages. The Bill has hitherto been commended to us as essential to the Government's policy, including their policy on productivity. It goes through its final stages in this House on the morrow of a settlement in the railway industry commended by the Minister concerned, a settlement that pays no regard whatsoever to the Government's incomes policy or to the Government's policy on productivity.
In view of what has happened, I do not know how the noble Lady, who always commands the interest of this House when she speaks on economic subjects, can have framed the conclusion of the speech which she has just delivered, that the public interest and the Government's policy would always be considered in wage settlements.
I should have thought there might be a good deal to be said for reaching this settlement, if it was to be reached, in order to prevent the public suffering, as it did suffer, from the go-slow. There would have been something to be said for the Government's insisting on sticking to their principles of productivity, and not yielding to a demand which they had long described as unjustifiable. But we had both evils. The public suffered by the go-slow, and in the settlement the Government's policy on productivity was utterly abandoned. What is illustrated, and I think that it is worth pointing out, is this. Every Government, from time to time, has to

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choose between two evils. What is unique about this Government is that, whenever they have to choose between two evils, they invariably choose both.
3.26 p.m.
LORD BESWICK: My Lords, it would be fascinating to speculate how the noble Lord, Lord Conesford, would have handled the difficulties we have just seen on the railways. His speech was not entirely up to his usual standards of punctilious accuracy. He said that my noble friend Lord Royle had not voted. I distinctly recall my noble friend saying "Content" when the Question was put. The noble Lord said that the railway settlement was not in accordance with the principles of the prices and incomes policy of the Government. A little later on in another place a Statement will be made about the railway settlement. It is not my business to repeat it in this House, but it is interesting to see that, of the three principles which the Government and the Railways Board have followed in the matter, the third is that any settlement must be in accordance with the productivity, prices and incomes policy, and they are satisfied that the settlement in fact accords with that policy.
I was particularly grateful that my noble friend Lady Wootton of Abinger should have put this matter in its perspective. There are philosophical issues concerned. There are deep feelings aroused by this Bill. But I would say to my noble friend Lord Brockway that all the philosophy is not on his side. There is another point of view to this, and we have tried to put it. As my noble friend Lord Brockway recounted his memories of the past, I felt that he was tending to look at this matter, as Wordsworth might have said, in terms of
"Old unhappy things,
Of battles long ago."
Times have changed. My memory went back, too, when as a boy I followed behind the miners marching, to hear A. J. Cook urge that they stand firm on the slogan:
"Not a penny off the pay,
Not a minute on the day!"
No nil norms in those days.
Those were days when I could understand the line taken by my noble friend. But the coal-owners have gone; Alf
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Robens has replaced them. A miner's son is now the Chancellor of the Exchequer. A grammar school girl has brought in this Bill. We are faced with other problems than old slogans. We have questions of the balance of payments. We have demand management. We have all the financial problems of paying the bills which Imperial Britain has left behind as it has pulled out of different parts of the world. We are no longer able to shout defiant slogans and feed our people. We have a much more complicated economic task before us.
I should like to think that all trade unions behaved in the way in which my noble friend Lord Brockway suggested they do. But the fact of the matter is that they do not. The overwhelming majority of them are socially responsible. The overwhelming majority of them know the problems we have to deal with. But as his mind went back, mine also went back to a meeting of a few weeks' ago, when the Prime Minister was trying to convince one general secretary of the merits of concentrating on productivity, and trying to get him to give up the opposition that he had to this prices and incomes policy.
This particular general secretary said, "Prime Minister, I understand; but let me tell you a story"—probably it ought to be called a parable. He said: "There was one general secretary who was instructed by his executive to go out and conclude a fresh agreement with a firm on which his union had a stranglehold. He was told to get an increase in pay; if possible a reduction in hours." The story went on to relate how, after protracted negotiations, the general secretary came back and he told his executive, "Yes", he had got an agreement. Pay had been increased much more than the figure they had hoped for. Fringe benefits had been improved. Hours had been reduced. They now worked only on Thursday afternoons. The executive considered this report very carefully, and then turned round to the general secretary and said, "It is not too bad, but what is this about working on Thursday afternoons?" This story was told as a parable to illustrate what some trade union leaders are confronted with.
As I say, this is not by any means typical. But this Bill is designed to try to ensure that there is fairness between

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one group of organised workers and another; between one group of organised workers, as producers, and their wives, as consumers; between organised workers and those who are too old to work or too young to work or too sick to work. It is an endeavour to ensure that as we have increased material wealth, due to technological advance, it is shared as reasonably as possible. The noble Lord himself said that not all people in this country can benefit from productivity agreements. That is quite true. That is one reason why in those capital intensive industries, where it is possible to increase productivity, a part of the increased wealth should be given to other sections of the community. That is why we want to get some idea of controlling the distribution of our increasing wealth production.
My Lords, it is not for me to delay business in this House. I have certain other responsibilities. I am grateful for the way in which noble Lords opposite and those on this side have listened to the arguments, have put a point of view on this Bill, and I hope that they will now agree to give it a Third Reading.
On Question, Bill read 3a, and passed.

INTERNATIONAL MONETARY FUND BILL
Brought from the Commons; read 1a, and to be printed.
OVERSEAS AID BILL
Brought from the Commons; read 1a, and to be printed.
SWAZILAND INDEPENDENCE BILL
Brought from the Commons; read 1a, and to be printed.

NIGERIA: FEDERAL GOVERNMENT AND BIAFRA RELIEF
3.34 p.m.
LORD SHEPHERD: My Lords, with the permission of the House, I would now reply to the Private Notice Question asked by my noble friend Lord Brockway earlier this afternoon. Perhaps the House would wish to be reminded of the Question. It is:
"To ask Her Majesty's Government what action is being taken to meet the refusal of the Nigerian Federal Government to allow relief by airlift to the hungry thousands in Biafra."
The position is not that the Federal Government of Nigeria have refused to allow relief supplies by air. The truth is that this is an extremely difficult and delicate problem which is at present under discussion between the International Red Cross and the Federal Government and also between the noble Lord, Lord Hunt, and his relief advisory team and the Federal Government. I do not want to say anything this afternoon that could be an obstacle to a successful outcome of those discussions, and I hope, therefore, that my noble friend will not press me. I can, however, say that the noble Lord, Lord Hunt, has already been in communication with us about certain standby precautions which may be helpful in saving time when specific recommendations from him have been received.
LORD BROCKWAY: My Lords, while thanking my noble friend for that Answer, I must assure him that I do not want to say anything which will make the situation more difficult. May I ask him whether it would not be possible to propose to both the Biafran authorities and the Nigerian Federal Government that inspection of relief, either by air or by road, should be given to the International Red Cross in order to prevent any diversion of supplies from food and medicine to arms? Is he aware that I have written to both Colonel Ojukwu of Biafra and General Gowon making that proposal? Secondly, may I ask him whether he is aware that I based my Question on the Press reports of what the Nigerian Federal Government have said, and I understand that since then they have indicated that authorised flights would be

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allowed. May I submit to him that if we are to secure the co-operation of the Biafran authorities in this matter, Her Majesty's Government should cease sending arms to the Nigerian Government? While it sends those arms is there any hope that we shall secure the co-operation of the Biafran Government which may relieve this tragic situation of thousands, and it may be millions, dying.
LORD SHEPHERD: My Lords, I have made our position, our policy on arms, perfectly clear to the Federal Government of Nigeria on many occasions, and I have nothing further to add. In regard to the first part of my noble friend's supplementary, I understand that the Federal Government are willing, and have always been willing, to co-operate with the International Red Cross in the matter of emergency supplies of food and medicine into the troubled areas of Nigeria.
LORD BROOKE OF CUMNOR: My Lords, are the Government aware that until relief is reaching these starving people the whole British people will continue to feel a certain sense of guilt? This is a country which until a few years ago was under the control of this Parliament. Now it is ravaged by civil war and children are starving. There must be no Party differences between us, because compassion for starving children should override all Party divisions and all legalistic arguments.
LORD GLADWYN: My Lords, on behalf of my noble friends on these Benches I should like to associate our-serves very strongly with what the noble Lord, Lord Brooke of Cumnor, has just said. I think that what he has said represents our view in this matter entirely. While we appreciate that on this subject of a possible airlift the Government must be very largely dependent on the advice which they will receive from the noble Lord, Lord Hunt, and his team, may I ask this question? Would it not be possible for the noble Lord, Lord Hunt, to arrange for a representative of the Nigerian Government to be associated directly on the spot with any despatch of food or medical supplies that may be organised and, therefore, for them to be in a position to verify directly that nothing else is being delivered?
LORD SHEPHERD: My Lords, I am very grateful for the words of the noble Lord, Lord Brooke of Cumnor. I think he is right that we all share a sense of guilt—I am not sure whether "guilt" is quite the right word, but any rate a sense of disappointment that the foundations which we sought to lay in Nigeria did not hold firm so that we could see a happy Nigeria. I recognise that my noble friend Lord Brockway's persistence is due to the fact that this is something in which he passionately believes. I only hope that he will accept that I and my other colleagues in the Commonwealth feel just as passionately, and perhaps even with a greater sense of burden, in that it falls to us to seek, by negotiations, not only immediate relief in this area but, what is more important, a long-term solution in that territory.
One must be careful what one says. One does not wish to appear to be partisan on one side or the other. In reply to the noble Lord, Lord Gladwyn, on the question of the International Red Cross and the supply and inspection of relief, I would say that this is something which is very much in our minds, particularly if we can get a daylight airlift as an interim measure until we are able to get the corridors of mercy open.
LORD WILLIS: My Lords, I accept and very much welcome what the noble Lord has said. I know nobody whose sympathies are more engaged in this matter than the noble Lord, Lord Shepherd, and I very much respect the efforts which he is making. Compassion is not a monopoly of any one person or any one side in this matter. Of course I understand the difficulties, but it occurs to me that we are getting a little bogged down by red tape and by protocol. Is there not some new and fresh initiative that we can take—because the lives of children do not wait upon red tape or protocol—perhaps through the United Nations, to break this deadlock rather than to engage in continued negotiations which every moment are costing lives?
LORD SHEPHERD: My Lords, I am glad that the noble Lord has put his supplementary in that tone, which is different from the atmosphere which prevailed earlier on the oral question. I hope that my noble friend will accept that we are considering all possible means

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of bringing about a long-term settlement, and also short-term relief, to this unhappy country. But, as I said in my original reply, at this stage I would ask your Lordships not to press us, while giving you the firm assurance that we are doing all that is humanly possible to find a solution.
LORD BROCKWAY: My Lords, although I do not want to press any course that would he embarrassing, in view of the urgency of the situation, the deaths which are occurring every minute and which will mount, can we not approach this matter as though it were a great natural calamity, such as an earthquake? In those circumstances would not the whole world go to the rescue of these hungry, starving and dying people? Is it not possible now to secure a massive airlift by all the sympathetic voluntary organisations, the Governments and the Agencies of the United Nations, which may be able to save thousands, and indeed millions, from death?
LORD SHEPHERD: My Lords, I fully accept what the noble Lord has said, but he must recognise that there are two parties to this unhappy dispute. We have been able to accept an agreement by one party, but there has been a complete and utter rejection by the other party. Therefore this has created severe difficulties, difficulties which at present we are trying to resolve.
LORD TREFGARNE: My Lords, could the noble Lord give an assurance that the Royal Air Force Air Support Command remains available to undertake a massive airlift, when and if such an airlift is approved by the Nigerian authorities?
LORD SHEPHERD: My Lords, the Royal Air Force Support Command is willing and ready to give what help and assistance it is required to give, provided that we have the necessary agreement of the Federal Government. I do not have any doubt about that.
LORD REA: My Lords, is it expected that there will be a local base for this Command, or will they operate from this country—and if it is a local base, which?
LORD SHEPHERD: My Lords, one supplementary mentioned air support from this country in terms of an airlift
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of food and medicine. Clearly there would need to be a base at the other end to receive the goods, but I am sure that in the end it will be better, when we deliver supplies, to do so through the International Red Cross, who are trying to co-ordinate the activities of a number of organisations which are in the field to give help.

TOWN AND COUNTRY PLANNING BILL
3.45 p.m.
THE PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD KENNET): My Lords, I beg to move that the House do again resolve itself into Committee on this Bill.
Moved, That the House do again resolve itself into Committee.—(Lord Kennet.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ST. HELENS in the Chair.]
Clause 65 [Modification of transitory exemptions based on pre-1948 use]:
LORD BROOKE OF CUMNOR LORD BROOKE OF CUMNOR moved, in subsection (1), to leave out "the commencement of this section" and insert "1st July 1969". The noble Lord said: I beg to move Amendment No. 68, to which Amendments Nos. 69 and 71 are related. It is a small point, and I hope that the Government will be able to offer a satisfactory solution. Clause 65 deals with certain rights of long standing deriving from use before the appointed day of July 1, 1948. It is proposed to bring those rights to an end, which I agree is a sensible action to take at this stage. It seems to be most important that we should make clear in good time to all concerned that these rights are coming to an end unless they are exercised in one way or another very quickly. In another place an Amendment was moved which would have had the effect of continuing the rights for a further five years. I consider that that is too long, but I think that a specific date should he put into the Bill. One must look at the practical side of the matter. People are in the habit of getting advice from solicitors and professional men, and one can hardly expect those advisers to watch progress on

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every Bill as it passes through Parliament, though it is unquestionably their duty to acquaint themselves with its provisions as soon as the Bill reaches the Statute Book so that they can inform their clients accordingly.
The phrase "The commencement of this section" is uncertain. In a later clause the Minister has power, by order, to fix a date for the commencement of this section and of other sections, but nobody can yet tell what that is. The bringing to an end of these long standing rights should in no sense be a "hole and corner" business. It should be stated on the face of the Bill when they will act. I suggest that the uncertain phrase, "The commencement of this section", should be replaced by the certain date "1st July 1969". I agree that I put down this Amendment at a time when I hoped, as indeed the Government hoped, that this Bill would reach the Statute Book before the Summer Recess. It now looks as though it will not do so and will not reach the Statute Book until October. However, my concern is not so much with the precise date as with the fact that precision should be given by the writing of a date into the Bill. In this way when the Bill reaches the Statute Book solicitors and professional advisers will be able to advise clients who retain these longstanding rights that unless they take action before a certain date which is publicly known, they will lose those rights. In moving this Amendment, I seek to remove that kind of uncertainty.
Amendment moved—
Page 56, line 20, leave out ("the commencement of this section") and insert ("1st July, 1969").—(Lord Brooke of Cumnor.)
LORD KENNET: Those who do not know as well as the noble Lord and I do what we are talking about may like to be reminded what these rights are. When the first comprehensive planning legislation was introduced by my noble friend Lord Silkin in 1947, people had rights to use land in certain ways, which was the product of custom and chance, very slightly—but only very slightly—mitigated by preceding planning legislation. People who have since 1947 been using their land in way x have had the right to revert to using it in certain ways only, which I may describe as X, if they were using it in those ways before 1947.
664
But all that was 20 years ago, and I should think most people have by now long since forgotten how they were using their land before 1948. It would be rather difficult, in certain cases, if there were any dispute about it, to find how they were using land. But I cannot imagine that anybody, who has refrained for 20 years from using his right to revert to what he was doing before 1948, is going to suffer very much by being deprived of that right either now or in 1969.
I hope that the noble Lord will withdraw his Amendment, on the ground that the Government are unaware of any cases which would justify it. Of course, the fact that this shadowy right to revert was going to be taken away became public knowledge when the Bill was introduced in December of last year. All you have to do to exercise your right is to commence something which counts as "works", and I think that if anybody wants to do it he should have had plenty of opportunity between then and the time when the Bill is likely to come into effect, without including the set date of July, 1969.
LORD BROOKE OF CUMNOR: I am disappointed with the Government's reply. I know that I am not at liberty to quote speeches by private Members in another place, but examples were given to the Government in Standing Committee in another place of cases where there was likelihood of some of these 20-year old rights being revived. I cannot see any reason why the Government should not state a definite date when these rights will lapse. The phrase, "the commencement of this section" is entirely vague, because the Government have not yet given any indication as to when they will, by order, cause this section, or any other section of the Bill, when it becomes an Act, to come into operation.
It seems to me unreasonable towards professional advisers, as well as to their clients, if this is left in a state of uncertainty. I stress again, that we cannot expect solicitors to be following all the proceedings on a Bill while it is going through Parliament simply in order to safeguard a client against something that may happen the moment a Bill passes through your Lordships' House and receives the Royal Assent. I should have thought that, from every point of

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view, it was far better, when a right of long standing was being terminated, to give well in advance a date when that right will lapse so that everybody shall know where he stands. If the noble Lord will not accept my Amendment, will he at least give an indication as to the date on which the Minister will announce that this section shall commence, because we expect the Government to take some action to remove the uncertainty to which I have drawn attention?
LORD KENNET: I cannot do so at the moment, but I will try to do so at a later stage. I think that the discussion now and the discussion in the House of Commons should serve the purpose desired by the noble Lord, of bringing to the attention of people the fact that there is this provision in the Bill. Of course, in so far as our words are heard outside this place, it is obvious that those who have these rights and are intending to exercise them would be well advised to do so before the Bill goes through, just as they would be well advised to do so before July, 1969, if the noble Lord's Amendment were accepted.
LORD BROOKE OF CUMNOR: I am sure the noble Lord is trying to be helpful, but, with respect, it is unlikely that the proceedings on this Amendment will be widely reported in the national Press, and, to the best of my knowledge, the proceedings in Standing Committee in another place on what was then Clause 57 of the Bill and is now Clause 65 were not reported at all. Just as it is impossible to expect solicitors to follow everything that happens on a Bill while it is going through Parliament, so it is impossible to expect them to read the proceedings in Standing Committee and the detailed proceedings in your Lordships' House. However, if the noble Lord will make a statement, before this Bill leaves your Lordships' House, as to the date when this section is likely to be brought into operation, that will go some way to meet my request. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
THE DEPUTY CHAIRMAN OF COMMITTEES (LORD GRENFELL): May I point out to the Committee that, if
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Amendment No. 70 is agreed to, cannot call Amendment No. 71?
LORD KENNET: This Amendment substitutes a revised subsection (3) of Clause 65 for the subsection at present in the Bill. The existing subsection was complained about in Commons Committee as being difficult to understand. I hope that the present one is easier to understand, and that the noble Lord, Lord Brooke of Cumnor, and the Committee will agree with me that it should be carried in. I beg to move.
Amendment moved—
Page 56, line 31, leave out subsection (3) and insert—
("(3) In applying section 13(5), 6) and (8) of the principal Act (factors relevant for determining whether planning permission is required for resumption of use following the expiration of a limited planning permission) no account shall be taken of any contravention of previous planning control other than contravention of the provisions of Part III of the Town and Country Planning Act 1947; and accordingly—

(a) in both section 13(6) and 13(8), for the words 'or in contravention of previous planning control' there shall be sutstituted the words 'or in contravention of the provisions of Part II of the Act of 1947'; and

(b) section 13(10) shall cease to have effect.")—(Lord Kennet.)

On Question, Amendment agreed to.
Clause 65, as amended, agreed to.
Clause 66 agreed to.
3.58 p.m.
LORD GRIMSTON OF WESTBURY LORD GRIMSTON OF WESTBURY moved, after Clause 66, to insert the following new clause:
Notification to parish councils to applications
".—(1) (a) Without prejudice to sections 15 and 16 of the principal Act, a local planning authority shall not entertain any application for planning permission, unless either—

(i) it is accompanied by a certificate signed by or on behalf of the applicant stating that he has given the requisite notice to the parish council (if any) of the parish in which the land is situated; or

(ii) the parish council has notified the local planning authority in writing that for the time being no such notice is required and has not withdrawn such notification:

Provided that the local planning authority may notwithstanding the absence of such a certificate or notification entertain an application for planning permission if an authorised officer of the parish council or local planning

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authority certifies in writing under his hand that the requisite notice has been given to the parish council.
(b) For the purposes of paragraph (a) above an authorised officer is an officer authorised specially or generally to give the certificate by the council or authority which employs him.
(c) Subsections (5) and (6) of section 16 of the principal Act shall apply to a certificate issued under this section as if it were issued for the purposes of the said section 16.
(2) (a) A local planning authority may make a scheme for defining the types or classes of applications for which no such notice as is mentioned in subsection (1) above is required.
(b) A parish council which accedes in writing to a scheme drawn up under the preceding paragraph shall be deemed in relation to the types or classes of applications defined therein to have made a notification in accordance with subsection (1)(a)(ii) above.
(c) Where a majority of parish councils in an area to which a scheme applies has acceded thereto in accordance with the preceding paragraph, the scheme shall become compulsory and the local planning authority shall inform the remainder of the parish councils in the same area in writing, and thereupon each parish council so informed shall be deemed to have acceded to the scheme on the day when such information would have been received by it in the ordinary course of post.
(d)(i) A local planning authority may revoke a scheme made under this subsection, and
(ii) if a majority of the parish councils concerned in a compulsory scheme notify the local planning authority in writing of their intention to leave it, those parish councils shall no longer be deemed to have acceded thereto:
Provided that—

(i) no scheme shall be revoked within three years of the date when it was first made, and

(ii) no parish council concerned in a compulsory scheme shall notify its intention to leave it within three years of the day when it became compulsory.

(3)(a) Where a certificate has been issued by an applicant or authorised officer under subsection (1), a local planning authority shall take into account any representations made by a parish council named therein and received within fourteen days of the date upon which it was given to the authority and may, if they think fit, consider any representations received thereafter.

(b) This subsection shall not prejudice any rights which a parish council may have by virtue of any other enactment.

(4) In the case of an application accompanied by a certificate or certified in accordance with subsection (1) above, a local plan-
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ning authority shall within a reasonable time give to the parish council a copy of—

(a) their notice to the applicant of their decision on the application, or

(b) their notice to him that the application has been referred to the Minister in accordance with directions given under section 22 of principal Act.

(5)(a) Subject to the following paragraph of this subsection, this section shall come into operation on 1st July 1969.
(b) Notwithstanding the previous paragraph, the Minister may at any time after the passing of this Act make development orders prescribing notices and certificates required for the purposes of this section, but no such order shall be made so as to come into operation before 1st July 1969.
The noble Lord said: The object of this Amendment, in the name of my noble friend Lord Kinnoull, is to try to ensure that parish councils are notified when planning applications are sent in. I should like to stress that there is no demand here for consultation. What is required is notification, in order that a parish council may be aware of any planning application in its parish in order that it may, if it wishes, comment on that application to the planning authority. It is felt that there need be no delay here, because there would be perfectly simple mechanics whereby a question could be added to the planning application form, asking simply whether notification had been given to the parish council. On the answer, "Yes" being given, it would then be up to the parish council to communicate with the planning authority. The purpose of this new clause is an attempt to bring the parish councils to a position where they can of right give their views on planning applications. I beg to move.
Amendment moved—
After Clause 66, insert the said new clause. —(Lord Grimston of Westbury.)
LORD SANDYS: I should like to support this Amendment most warmly. We have already witnessed the debate on Second Reading, and have already read the details of the discussion which took place in Standing Committee C. Although we may be under a certain restriction about quoting speeches of private Members in another place, I hope that at a later stage of my remarks the noble Lord, Lord Kennet, will permit me to quote the remarks of the Joint Parliamentary Secretary, Mr. Arthur Skeffington. On

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June 19, in Standing Committee C, column 8, line 33, reference was made to,
"the additional burden placed upon the applicant".
This is a very important matter, because in fact there is very little additional burden placed upon the applicant when it comes to notification: it is merely a case of the architect or those responsible for preparing the plan providing an additional copy, be it a Xerox copy or any other, of the plan under consideration. I feel that very heavy weather has been made of this when referring to local authorities, and especially to the fact that there is difficulty in locating where the parish council is. Of course, immediate reference to the local authority concerned would divulge this information.
The Government's second argument for opposing this Amendment relates to the structure of local government and to the Royal Commission's recommendations for reorganisation. If I may now quote Mr. Arthur Skeffington's words in column 9, line 23, of Standing Committee C on June 19, he said:
"I do not know what those recommendations will be, nor whether the Government will accept them; but it is likely that within the next few years there will be very radical changes in the structure of local government. It may be that there will be an extended place for the parish council".
Although there is the possibility of an extended place for the parish council, the idea of a nationwide voluntary scheme of notification has very little appeal among local authorities. The Rural District Councils Association has given it a very limited welcome, but by and large I would say it is true that local government as a whole is firmly against it. They look upon the parish council as something of a poor relation in this matter; and, moreover, it is looked upon as an amateur organisation from the standpoint of an entrenched bureaucracy.
Perhaps I may quote from my own experience in this matter. If I may be permitted, with the indulgence of your Lordships, I should like to quote as an example a case when this scheme would have been particularly useful. To save the blushes of the local authority, let me give it the fictitional name of "Caster-bridge". In this particular case I saw details of the town development scheme, which extended into several country parishes. The reply I received was:
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"Our final proposals are with the Ministry for approval and are not available for public inspection".
So not until a short period before the local inquiry was due to be held was any map available, despite the fact that the proposals involved an increase in the size of Casterbridge from 9,000 to 30,000 over a period of 15 years. There was no model or map, no publicity and no exhibit in Casterbridge Town Hall, and I was unable to obtain a copy of the town map giving details of the scheme since only one was available. It was a deliberate act on the part of the local authority, and I have very little doubt that there are many instances of a precisely similar nature which are taking place and which have taken place over and over again.
Coming on to the nature of this Amendment, it will be noted that it is split into four separate sections. It is, of course, the longest Amendment of all those listed. I should like to draw your Lordships' attention to subsection (2), which relates to a local planning authority making a scheme for defining the type or classes of applications for which no notice such as is mentioned in subsection (1) is required. This is a highly desirable suggestion, that schemes for defining applications where no such notice is required should be devised, and I think that this subsection should meet wit h very little opposition.
Subsection (3), which relates to representations by parish councils, says:
"Where a certificate has been issued by an applicant or authorised officer under subsection (1), a local planning authority shall take into account any representations made by a parish council named therein and received within fourteen days of the date upon which it was given to the authority and may, if they think fit, consider any representations received thereafter".
The nub of the Government's case has rested upon the factor of delay which notification both of applications and of the results of applications will have upon the planning mechanism, and great stress has been laid upon the fact that the whole essence of the Bill is to simplify the planning procedures. I feel here that the case put forward by the Parish Councils' Association is a very strong one, in that only 14 days' notification is mentioned; and it is surely no matter that the Parish Councils' Association should feel any

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sympathy for any parish which has failed to do so. After all, four months is the average time in which planning may be applied for and a reply may be received and a fortnight's delay or possible delay is very little in comparison.
Subsection (4) of this Amendment deals with notification of decisions, and in this case the question of notification is slightly different from consultation. In this matter great stress was laid by the Parliamentary Secretary during the Standing Committee, in his very reasonable reply to this question, on the difference between consultation and notification. What is being sought under this Amendment is a notification. One would hope that as time goes on the relationship between the planning authorities and the parish councils will mean that such notification will lead to a type of consultation. However, at this stage, in this Amendment as drafted, all that is sought is a notification. It was mentioned on Second Reading that many local authorities have very long and satisfactory voluntary arrangements with parish councils. This statutory notification has been sought by the Parish Councils' Association for eight years to my certain knowledge, and I feel there are strong reasons why this Amendment should be included in the Bill.
LORD KENNET: I beg to move that the House do now resume to hear a Statement from my noble friend Lord Beswick.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

STERLING BALANCES: INTERNATIONAL BANK'S SCHEME
4.8 p.m.
LORD BESWICK: My Lords, with permission I would repeat a Statement made by the Chancellor of the Exchequer in another place. The Statement is as follows:
"The House will be aware that discussions have been taking place this week-end at the Bank for International Settlements in Basle amongst the representatives of the central banks of
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certain countries about a new facility for sterling. The proposals which were considered were to provide new means for offsetting fluctuations in the sterling balances of sterling area countries. I should make it clear that the facility under discussion is not one which would provide finance to meet any deficit in the balance of payments of the United Kingdom. It is not a loan. It is not an arrangement which could or will lead to any increase in our total of overseas indebtedness. The object would be to strengthen the position of sterling and thus of the international monetary system as a whole.
"I am glad to be able to tell the House that considerable progress has been made in these discussions. As a result, the Bank for International Settlements and twelve Central Banks, speaking where appropriate with the authority of their Governments, have given firm assurances of willingness to participate in the arrangements which are to be completed as soon as satisfactory consultations have taken place with sterling area countries. These proposals are of great importance to all sterling area countries, and it is therefore right that consultations should take place with them all. These will be pursued urgently, but until they have been completed it would be wrong for me to make any further public statement.
"I should like to express my warm appreciation of the constructive attitude of the countries with which these discussions in Basle have been conducted. I believe that the arrangements now contemplated, and the firm assurances we have had from these countries, offer the prospect of greater stability in the functioning of the international monetary system. While they in no way lessen the need to bring our own policies for restoring the balance of payments of the United Kingdom to a successful conclusion, they make it possible to pursue these policies without being adversely affected by fluctuations in the sterling balances. They are a major step forward in dealing with this long-standing problem."
EARL JELLICOE: My Lords, we are grateful to the noble Lord for repeating this important Statement, although I

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must say that I should have hoped that we might have been permitted a rather earlier sight of it through the usual channels, especially in view of the fact that a Statement very much along these lines was issued by the Bank of England shortly after luncheon. It is clear that a lot of consultation and much negotiation has still to take place, and I am sure that none of us would wish to say anything at this stage which might in any way prejudice the outcome of those negotiations. I shall therefore confine my questions to a number of relatively simple points.
In the first place, can the noble Lord tell us anything more about the type of financial operation which is involved here? We are told that this animal is not a loan. What, in fact, is it? Secondly, can the noble Lord tell us anything more about the position of France? For example, were the French representatives at Basle this week-end able to subscribe to this firm assurance reportedly given by the representatives of the other central banks? Thirdly, what is the time scale involved? When is it hoped to conclude these negotiations? Fourthly, and finally, can the noble Lord tell us—and I think this is important in view of the great volume of Press speculation that there has been on this subject—anything more about the magnitude of the sum involved and about the interest rate?
LORD BESWICK: My Lords, I thank the noble Earl for his general remarks. I share his views about the advantage of an earlier sight of the Statement. As to the type of operation, as I said in the Statement, it not a loan; it is a type of funding operation. It is really an exchange of a short-term sterling indebtedness for a longer-term indebtedness. As to the question about the position of France, I can do no better than to read what was said in the communiqué:
"The Bank of France, while in present circumstances it must reserve its position, has expressed itself as sympathetic."
France, therefore, has not made any contribution to this arrangement. The noble Earl also asked about the time scale. Consultations will start urgently; in fact in a matter of days, and I hope that they will be completed within a few weeks. I was asked also about the magnitude of the loan. It will be for 2 billion dollars.
LORD GLADWYN: My Lords, I and my noble friends on these Benches greatly welcome the principle of the Statement made by the noble Lord. It seems to us, in principle, an extremely healthy phenomenon and is much to be welcomed. If it goes through it will ease the difficulties on the international monetary front to a great extent. I have only two questions to put to the noble Lord. The first one relates to France. From what the noble Lord has said, the Bank of France are sympathetic, as I understand, to this operation. It does not mean that they will therefore, necessarily, come into it, I gather, although they may contemplate doing so. If they do not come in, is it the intention to proceed with the scheme? I imagine that it is; since twelve central banks have already agreed. I imagine that if the French do not come in it will be the intention of Her Majesty's Government to go ahead without them. I should like the noble Lord to give us confirmation of that. Secondly, is it considered, as a result of the measures contemplated, that some portion of the sterling balances will be funded in the long run?
LORD BESWICK: My Lords, I thank the noble Lord for his welcome to this Statement. I do not think that I can add anything to what I have already said about France's position. It is the intention of Her Majesty's Government and of the other Governments concerned to proceed with this arrangement, even though the French Government are not able to do more than to express sympathy. The question of future funding is a separate matter. I cannot say anything on that.
LORD CARRINGTON: My Lords, may I ask the noble Lord this question? I may not have fully understood him, and he may have mentioned it in the Statement. He said that this would not mean an increase in our total indebtedness. Does this mean that this is really a funding operation, a move from the short-term to the medium-term, and nothing else?
LORD BESWICK: My Lords, as I said in the Statement, it is not a loan. As I said in answer to a question, it is a type of funding operation and a question of exchanging one debt for another.

DEEP-SEA FISHING INDUSTRY
4.17 p.m.
LORD BESWICK: My Lords, with permission, may I repeat a Statement made by the Minister of Agriculture, Fisheries and Food in another place:
"As my honourable friend the Parliamentary Secretary announced on May 15, we are satisfied that the deep-sea fishing industry can make an increasing contribution to import saving, given the assurance of adequate support and a continuing improvement in efficiency.
"We propose to give an assurance of continued support to the deep-sea fleet for a minimum period of five years. If the industry is to justify this support it is essential that it should take all possible steps to improve its efficiency both through technological development and through changes in structure and organisation which will promote better management and training. We intend, therefore, to operate the support that is being provided, so that the benefit will go to those companies which can make the most productive use of these resources. In addition, the Industrial Reorganisation Corporation, which has been studying the industry, has informed me that it is willing to help the industry to find the best means of improving its efficiency. The industry for its part has assured me of its readiness to co-operate to this end.
"On this basis and on the assumption that the industry will make satisfactory progress towards the objectives I have described (a matter which I shall be reviewing from time to time with the Industrial Reorganisation Corporation) we propose to introduce for the three years beginning August 1, 1968, a new form of operating subsidy. This will take account both of fluctuations in the industry's profitability and of the need to preserve an incentive to efficiency. This will be done by adjusting a basic subsidy of £2 million by reference to operating profits in the preceding year. If these are less than £4 million, the basic subsidy of £2 million will be increased by half the shortfall; if they are more than £4 million, the basic subsidy of
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£2 million will be reduced by half the excess. The total annual subsidy, however, will be limited to £4 million and will not be allowed to result in an annual level of profit plus subsidy exceeding £7 million. The distribution of the subsidy will be related to the operating efficiency of vessels and not as at present to their classification. The detailed arrangements will be worked out with the industry. The method of support after the first three years will be subject to a review in 1970 with the objective of maintaining a corresponding level of return in the two years commencing August 1, 1971.
"Legislation will be introduced early next Session to give effect to the proposals I have announced. Meanwhile, a scheme will be laid before Parliament providing for the maximum basic and special subsidies payable under existing legislation for the subsidy year beginning August 1, 1968. These subsidies will in due course be set against the total sum due to the industry for that year under the new policy."
LORD NUGENT OF GUILDFORD: My Lords, may I thank the noble Lord, Lord Beswick, for this Statement about the deep sea fishery industry? May I put to him one general point first? This I suppose, is the most hazardous and difficulty industry in the world. Profitability is still the ultimate criterion which determines whether a vessel goes to sea or not. As success depends to an exceptional degree on a mixture of skill, courage and enterprise, inevitably the pressure at the economic margin of the industry is acute. A subsidy cannot relieve the acuteness of the pressure, it can only move the position at which the pressure falls, and may blunt the incentive in the process. In the unique circumstances of the industry, have the Government considered the alternative approach of securing the home market for our own fishermen by suitable import controls and removing the whole subsidy structure?
LORD BESWICK: My Lords, I wholeheartedly agree with the noble Lord's remarks about the hazardous character of this industry. I think that he will agree, that in so far as one can encourage efficient units within the industry, a

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formula of this kind is to be desired. The noble Lord asked whether the possibility of restricting imports had been considered. The answer is, that it has been considered. There are, of course, difficulties, especially those connected with our obligations to the EFTA countries, but my right honourable friend is proposing to have discussions about imports with our EFTA partners.
LORD NUGENT OF GUILDFORD: My Lords, may I thank the noble Lord for that answer and say that I hope the discussions may be fruitful because I believe that this would be a better approach in the long run? In the meantime, may I ask the noble Lord to confirm my impression that the new subsidy structure proposed is putting emphasis on efficiency of operation in order that in every way possible incentives may be given to the enterprise and adventure on which the whole success of the industry depends?
LORD BESWICK: Yes, My Lords, that is the intention of the formula. As the noble Lord will see when he reads my Statement, this is something I have emphasised. The details of the formula will be worked out with the industry within this principle.
LORD REA: My Lords, may I welcome the Statement and thank the noble Lord for making it? It seems particularly satisfactory that the subsidy will be actuated with regard to classification and therefore the smaller vessels and the efficient vessels will have a better and fairer share than in the past. There are two small questions I should like to ask as subsidiaries, and perhaps they are a little off the mark. One is, will this have any connection with the new 12-mile limit and how has that been working for the past four years? Secondly, suppose this scheme is extremely successful, is there a danger of over-fishing so that there will be such a shortage of fish that there will not be as many fish in the sea as there used to be?
LORD BESWICK: My Lords, I thank the noble Lord for his welcome for this Statement. I am afraid I cannot answer his question about the 12-mile-limit: it is not, of course, related to this Statement; but I will find out what has been done recently and I will let the noble
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Lord know. I understand his fears about over-fishing, but he will recall that I did say that there will be a limit to the subsidy, and I should have thought that would take care to some extent of his doubts on that.
LORD NUNBURNHOLME: My Lords, may I ask the noble Lord one question? How is this subsidy going to affect the present price of fish? Is it going to be maintained, or will this subsidy reduce the price so that really, the fishing industry will be no better off?
LORD BESWICK: No, my Lords, I do not think that it will necessarily work in that way. In so far as this proposed new formula will encourage efficiency, I would have thought it would tend to result in the most economic industry possible. What will in fact happen to the price of fish over the years is, of course, another matter, but what we hope is that it will be as low as is economically possible.
LORD INGLEWOOD: My Lords, may I ask the noble Lord, Lord Beswick, not to pass too lightheartedly over what the noble Lord, Lord Rea, said about over-fishing? The ever-increasing efficiency of the industry really means that the distant water trawlers are fish destroyers and the stocks of fish in the oceans have been very seriously reduced. If we are going to take measures to increase the efficiency of the industry still further, we must at the same time increase our efforts to ensure the conservation of fish stocks.
LORD BOOTHBY: My Lords, before the noble Lord, Lord Beswick, replies, may I support what has just been said by my noble friend Lord Inglewood? The beneficial effects of these subsidies will be nullified if over-fishing is allowed to take place again on the scale on which it has occurred on two or three occasions in this present century, particularly in the North Sea. Will the noble Lord and Her Majesty's Government bear in mind that it is far more important to get some international agreement to limit fishing, and to prevent over-fishing, than it is to protect the home market?
LORD BESWICK: My Lords, may I say that I am surprised that the noble Lord, Lord Inglewood, should suggest that I was taking the question from the noble Lord, Lord Rea, lightheartedly.

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That was certainly not my intention and I hope that the noble Lord, Lord Rea, did not take my answer in that way. I was pointing out, on the basis of the information I have, that this is not an open-ended subsidy and to that extent, therefore, it would not necessarily encourage over-fishing. However, my Lords, there is a separate problem which will be present, irrespective of the type of subsidy, and if I can add usefully to the information about that problem I will certainly write to the noble Lords.

TOWN AND COUNTRY PLANNING BILL
4.28 p.m.
House again in Committee.
LORD PARGITER: I hope that this Amendment will be resisted. The primary object of this Bill is to try to tidy up the present position with regard to outstanding planning matters and to shorten the period taken to complete planning procedure. The procedure proposed in the Amendment, however skilfully it may be argued, would undoubtedly result, if accepted, in an increase in the amount of time taken to deal with planning applications. It would, incidentally, place a parish council in a stronger position with regard to planning than a district council is at the present time. Surely that would be a little topsy-turvy, to say the least.
At present the law requires that a county council or planning authority (which may be a county council or a county borough council) shall consult with a rural council or an urban district council—at any rate, a county district council—with regard to these matters. In many cases, as your Lordships will be aware, there are schemes of delegation by which the district council itself deals with a number of planning applications. Where there is no delegation the planning authority must consult the council in connection with these matters. This system, by and large, works fairly well, but it still takes up a great deal of time. Let us take the position with regard to planning and see exactly what happens.
THE EARL OF KINNOULL: If the noble Lord, Lord Pargiter, would permit me to intervene, may I say that I think he is missing the point of the Amendment
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completely? He keeps on talking about consulting but if he looks at the Amendment he will see it is a question of notification, which is entirely different.
LORD PARGITER: I have read the Amendment, and what I see is that it places on planning authorities an obligation to take certain action with regard to parish councils which they are not required to take with district councils. The effect would be to lengthen the proceedings. What happens with regard to planning applications is complicated. After the plan is put in, and the comments of those concerned have been obtained, there is often a general requirement for the applicant to agree to an extended time limit, because two months, or in certain cases three months, is the limit and after that the applicant has the right to deem his application to have been refused and to go to the Minister. That is the last thing that planning committees want to happen. They want to get decisions without going to the Minister. The application is subject to considerable negotiation between the planning authority, the district council and the applicant, who is perhaps asked to modify his application to make it more acceptable.
Again, the difference between an outline consent and a detailed planning consent causes a considerable amount of discussion and takes time. There is no short cut. We are trying to take cogs out of the planning wheel, and this Amendment would put another one in.
LORD BROOKE OF CUMNOR: I wonder whether the noble Lord would explain how. Under this Amendment the applicant would have the duty to inform the parish council, and if the council commented upon his application, it would be the duty of the county council, as planning authority, to take account of their representations. The only delay can be five minutes, or more perhaps in the county planning committee, to take account of the representations received from the man on the spot.
LORD PARGITER: I hardly share the noble Lord's optimism that it will take place so quickly, or that the parish council would be treated so cavalierly by the planning committee that their representations would be disposed of in five

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minutes. It would take more time than that. The applicant already makes three or four copies, but he would now have to submit additional copies and see that the parish council is notified. It is not a simple question. In the majority of cases, these applications are considered by the parish council and in some cases there would be a parish meeting. No doubt in many cases, there is dual membership between parish councils and rural districts councils. Altogether it cannot be said that machinery by which the parish council can make their views known is lacking.
But the Amendment places a definite statutory responsibility, in the last analysis, on the county planning authority. Surely it would be much better to leave a system that is operating satisfactorily. I recognise that probably parish councils desire to have more responsibility, but this is not the right place to give them greater statutory responsibility, because here it can be done by consultation. Planning authorities know that it is as well to have as wide a consultation as possible with everybody interested, and they do this almost automatically. There is no sense in their not doing so, because they know that if they do not the matter will catch up with them at a subsequent stage, and it will then take considerably longer than if there had been consultation at the beginning. I hope that your Lordships will not accent this Amendment, which can only add a further period to the time already consumed in dealing with planning consents.
VISCOUNT GAGE: I am all for parish councils knowing everything that is likely to affect their interests, whether they originate within the district or outside it. I am of the opinion that the present arrangements for consultation with, and for hearing the views of, parish councils are not everywhere what they should be, although I recognise that in some places they work in a satisfactory way. I also think that if those authorities where the arrangements are not good can be persuaded to adopt the methods that prevail satisfactorily elsewhere, that would be better than going in for some new form of procedure.
I have three objection to the proposals in the Amendment for formal notification. In spite of what has been said—and I appreciate that there are safeguards
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against delay—I think that there be delays. I can only say, after being for 20 years chairman of a county planning committee, that I have attended a number of rather stormy parish council meetings. The reason for their stormy nature was not because they had not heard of the applications but, every time, because they had heard of them and did nit like them. If we say that the planning authority must take account of what the parish council says, there may well be a good deal of difficulty about what that means. Does it mean registering the parish council's opinion or "steamrollering" it. I do not think that that would be accepted. I think that this will tend to delay proceedings, and it must be remembered that parish councils have no particular interest in getting these questions settled quickly. It will also tend to increase the number of appeals.
My second objection is on an entirely different line. The procedure proposed in the Amendment is not a very efficient way of informing parish councils. In my own county we have 109 parish councils, and that means 109 parish boundaries. I can imagine something happening outside one of those parish boundaries— perhaps an industrial chimney will be put up—and the parish council ought to know about it; but, sticking strictly to this Amendment, they may not hear about it because it is; not within their area. The third point is simply that this moment, just before the whole of our local planning structure is likely to be thrown into the melting pot, is a bad time to introduce this innovation.
What then can one suggest should be done? It is difficult to generalise, having regard to the fact that there arm so many different schemes of delegation of planning powers throughout the country. I believe that where rural district councils have schemes delegated to them every councillor should have knowledge of any proposition likely to affect his area, irrespective of whether he is a member of the planning committee, and, further, that he should have at his discretion complete power to discuss such matters with the parish councils in his area.
Equally, I think that this ought to be a two-way process. Parish councils should be encouraged to have a closer

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liaison than they do with their rural district council representatives. I would not mind guaranteeing that in the whole range of parish councillors quite a proportion would not even know the names of their district council representatives, and that a far larger number would have no idea of the names of their county council representatives. The one individual they do know about is the Member of Parliament, and disgruntled people, whether parish councillors or not, usually write to him. A Conservative Member told me only the other day that about half of his correspondence with constituents concerned planning matters. I think this is all wrong, and I suggested that he should refer them to local representatives. But it is difficult, perhaps, for a Member of Parliament to disregard any request from any of his constituents.
LORD INGLEWOOD: Perhaps my noble friend will allow me to interrupt. He has referred to Members of Parliament. Many of the letters that a Member gets in reference to planning decisions are not sent to members of the county council because people think that the county councillors are too much influenced by their officials.
VISCOUNT GAGE: This is an argument that I do not think it is easy to carry on, because one might easily say that Members of Parliament are affected by other things, such as Party considerations, or something of that sort. I hope my noble friend will agree that fundamentally these are wrong questions to be addressed to Members of Parliament, who have many other things to think about.
LORD INGLEWOOD: I entirely agree. They should be passed back.
VISCOUNT GAGE: My suggestion is that, with the aid of the good services of the Rural District Councils Association, where you have these delegated powers a circular should be devised to try to encourage all rural districts possessing these powers to adopt the same methods, which work satisfactorily in some cases and, where there is no scheme of delegation, perhaps to consult with the County Councils Association to see whether something like the Oxford principle could be introduced. For myself, I think it
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would be better to have that system, although I can see that some of the enthusiastic parish councillors, who want the semblance of power besides what they ask for here—who want parish council power, like student power—may not be satisfied. But, on the whole, I think they would get a better deal in the way I suggest.
LORD ILFORD: I have no wish to discourage my noble friend Lord Kinnoull, who has made the cause of parish councils his own. I am bound to say that I hope your Lordships will not adopt this Amendment. One of the purposes which the Minister has in view in promoting this new legislation is speeding up, if he can, the making of decisions in regard to town planning applications. I am bound to say to my noble friend—I have studied this procedure carefully—that it seems to me to be almost inevitable that the notice which will have to be given to the parish council, and the subsequent proceedings, will lengthen the process of obtaining a town planning decision.
I do not know how much we should gain by adopting the procedure which this clause proposes. There is no reason why the parish council should not submit their observations to the planning authority as they stand. If their feelings were strong about it, it might well be that if their views were communicated direct to the planning authority they would receive more attention than they would if they reached the planning authority through the process of compulsion which this Amendment proposes. In the authorities which I know most we have no parish councils, and so perhaps I am not the right person to assure my noble friend that they are not held in the degree of contempt to which he referred in his speech. Indeed, my experience of county councils and district councils has been that they welcome the co-operation of the parish councils. So far as policy is concerned, we have no dealings with parish councils, and perhaps I should be going too far if I were to assure my noble friend that in the boroughs there is certainly no feeling of criticism against them. Indeed, I think everybody wishes to see them succeed. They are really local government, and, after all, local government is the purpose that we all have in view.
LORD HOLFORD: I should like to intervene briefly to say a word on behalf of the applicant for planning permission and in support of what Lord Gage and Lord Ilford have just said. One can, I think, see the intention of this Amendment, but I believe that it is not workable. The planning application is made on forms, and the local planning authority can ask on the form for what information they wish. One has to give information (I am speaking as a planning applicant now) on a number of points, and if the local planning authority wish to ask on the form that you should state whether the parish council is aware of the proposal, or whether any discussions have taken place, they can do so.
I cannot support the Amendment for two reasons. First, the application is accompanied by a certificate, which is yet another piece of paper, possibly in triplicate or quadruplicate, that has to be produced. Secondly, it places the onus on the planning authority that they shall not entertain are application. That is a delicious word "entertain", but it means that it puts in the Bill that they cannon look at it without a certificate. It seems to me too formal and too time consuming. I suggest that the same result would be gained by the local planning authority simply asking for this on the form.
4.47 p.m.
THE EARL OF KINNOULL: I should like to support the Amendment. I apologise to the Committee for not being in my place when the Amendment was moved by my noble friend Lord Grimston, to whom I am grateful. To the one speaker who has spoken against this Amendment on the question of delay in planning I would point out that it is not consultation, but notification. The parish councils have only 14 days to consider, and it is then up to them to advise the planning authority whether or not they wish to make a comment on the application.
There are two other points in the clause to which I should like to draw attention. The first is under subsection (1)(a)(ii) where it says that any parish council may opt out of this scheme if they wish. This, I suggest, answers the criticism of those who may say: "What about parish councils who have not the facilities to consider the scheme?" They
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may opt out of it. Secondly, the local planning authorities themselves, under subsection (2) may prepare a scheme defining what type or class of application should be notified to the parish council. In other words, it would limit the number of applications that would necessarily be referred to the parish council only to those which the local planning authority really feel the parish councils should know about. I do not think this has been mentioned, but it is important.
The principle behind the clause is to keep the parish council informed of what is going on in their area. I suggest that this clause would strengthen the first fundamental of the Bill—namely, the quality of the decision making—without weakening the secondary aim of obtaining quick planning decisions. The noble Lord, Lord Sandys, has said that a certain number of enlightening planning authorities have already introduced a volunary system of notification based very much on the principle of this Amendment. There are, I think, 7 county councils out of 59, and 50 rural district councils out of 350, such as those with delegated powers, who practise a system of notification to parish councils. In other words, one-sixth of all the planning authorities practise this system voluntarily.
Because of the honest criticism that has been voiced, that such notification to parish councils would cause delays in planning, I took the opportunity last week of talking to one of those who operate this voluntary system. The clerk of the council concerned has devised a simple application form—which I would advise the noble Lord, Lord Ward, is not in triplicate—needing only the name of the applicant, the date of the application, the address and location a id the description. There are only four simple questions to be answered. In my professional capacity I have had to fill in many such forms, and I have found that it takes just two minutes. The clerk of this council was kind enough to write to me, and he said:
"I am writing to let you know t tat the operation of the scheme of consultation with parish councils on planning applications does not delay the reaching of planning decisions by my council's area planning sub-committees or the issue of decision documents, except in the very rare case where an applicant refuses to send brief particulars of his proposal to the parish council concerned."

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He went on:
"Partly as a result of this scheme, by and large our relations with parish councils have developed on most friendly and helpful lines."
One might ask: if this voluntary scheme works so well, what is the purpose of introducing a compulsory scheme? The reply is simple. The noble Lord, Lord Kennet, will know that for the past seven years planning authorities throughout the country have been urged by the Ministry of Housing and Local Government to introduce a voluntary system, and nothing has happened, apart from these seven county councils and 50 rural district councils—in other words, only a sixth of the total have taken note of it. I think it was in 1961 that the Ministry sent round a circular, urging local authorities to adopt the system. I am sure we all know cases where, through a lack of local knowledge, planning committees sometimes come to what might be termed difficult and awkward decisions on amenity in certain areas. Without wishing, to cast any aspersions on area planning officers, on whom planning committees rely so much, I am sure they would agree that, due to lack of time and pressure of work, they themselves sometimes come to wrong planning conclusions. I have evidence of a number of examples of planning decisions which all stem from a lack of knowledge of the area and which would have been prevented if parish councils had been notified.
I have in mind one particular case in the village of Long Marton in Westmorland. Here stands an old Norman church, on a 4th Century Romano-British site, and it contains two Saxon arches and a Saxon nave. It is one of the few churches in the country built with an outward sloping chancel wall, said to represent Our Lord's head hanging on the Cross. But its most remarkable feature are two Tympana, which are certainly pre-Conquest and possibly Scandinavian. It is undoubtedly a most important Christian monument, standing on a site of great antiquity in most charming unspoilt countyside beneath the Pennine fells of North Westmorland. A planning application by a neighbouring farmer was made to erect two 80 ft. tower silos 150 yards away from the church, and it was granted before any effective local opposition could be marshalled. A complaint
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was made to the Minister. I believe that the noble Lord, Lord Kennet, knows about this case. The Minister took the view that he could not interfere, so to-day in Long Marton we have this beautiful old Norman church, which has stood proudly for over 1,500 years, now overshadowed by hideous, large, although no doubt economic, 20th century grain silos—a monument for all to see for years to come of a travesty of good planning. This would not have happened if the parish council had been notified of the application.
The Committee will already have read that a Private Member's Bill was moved in another place in similar terms to this new clause, and, in fact, received its Second Reading there on March 1. The Bill was unopposed, and went to Committee on June 19. It passed through the Committee stage with one or two minor drafting Amendments, but I understand that, due to pressure of time, it has no chance of making further progress this Session. Therefore I suggest it is most important that this clause, even if the drafting is a little wrong, should be incorporated in this Bill. The grounds of objections raised against compulsory notification, as I understand it, are those of time and of cost: that the parish council could not easily partake in such a procedure; that all the local authority associations are opposed to it; that the Management Study Report is against it, and, finally, that the Skeffington Committee are at this very moment considering the question of public participation.
I should like briefly to deal with these points. The first, with regard to time and cost, I personally cannot accept, because I do not think that a mere notification made to the parish council wastes any time or money. I think it is valuable because, as the clause states, from that moment on it is entirely up to the parish council, which has 14 days in which to submit its views to the local planning committee. No consultations take place, no delays are incurred. Yet for the sake of this little extra effort certain important information and views may be made available to the planning committee. It was said in another place that this may be a burden, but I think the size of the burden on parish councils could be described as follows. Of the approximate total of 450,000 planning applications made every year, 90,000 of

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them, on average, affect villages; and there are 7,600 parish councils. So if we divide the number of parish councils into the number of applications, it comes to only twelve a year. That is not a great burden.
We then look at the local authority associations, who oppose it. We know already that the County Councils Association and the Rural District Councils Association are against it, but the Urban District Councils Association are for it, as also are the Civic Trust, some ratepayers' associations and the Women's Institutes—the latter being an important body. The Report on Management Study on Development Control came down against parish councils' being consulted. On page 36, under subsection (8) ("Consultation with Parish Councils"), it is stated:
"There is no statutory need to consult parish councils and it is considered that any advantages in consultations on general development control applications are more than outweighed by the delays that can occur. It seems that the right time to consult parish councils is at the development plan stage or before non-statutory maps are produced.
"We therefore recommend that in the interests of efficient management, parish councils should not be extensively consulted on development control applications."
I am not saying that I disagree with that statement, but in this Amendment it is a question not of consultation but of notification.
We then come to the Skeffington Committee. The setting up of this Committee was announced last January, at the time of the Second Reading of this Bill in another place. As I understand the position this Committee are looking into ways and means of achieving more public participation during the formation of the structure and local plans. These structure plans, will, of course, designate land use generally, but there will still be a necessity for specific land use, such details of specific applications as siting and amenity and design. These matters will still require to be discussed, and the notification of parish councils could be very important. I believe there is a real need for this statutory obligation to notify parish councils. It is said that one of the real problems that faced the architects of this Bill was deciding on the delicate balance between the speed of decision and the breadth of consultation, and I believe that this Amendment
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would achieve yet another vital factor in the balance of good planning legislation; namely, that of improving communications. I hope that my noble friend Lord Grimston will not withdraw this Amendment because I believe that it is of vital interest and value to planning.
VISCOUNT MONCKTON OF BRENCHLEY: I should like to support this Amendment from a different angle; and I declare my interest as chairman of a parish council in Kent. I am slightly surprised to hear some of the criticisms from noble Lords on this side about parish councils. We have grown since those days. The parish clerk has a telephone, and if there is a neighbouring parish council which has in a planning application which is likely to affect us the clerks get together and I, as chairman, am told about it that very night. We are one of those lucky areas which are informed, but not consulted, which gives us a chance to put in an objection if we feel strongly about it, and at least two parish councillors will go and see the site the day we hear of the application coming in. It at least takes some of the frustration away from the people on the ground, that is, the parish itself, the last remnants of democracy in this country, the grass roots. Before we turn down this Amendment let us have some faith n our parish councillors.
LORD INGLEWOOD: When I saw this Amendment down on the Marshalled List I read it carefully because I am always attracted by any proposals to help and encourage parish councils, for the reasons we have heard. It must be admitted that they vary greatly in their tradition, their interest in affairs generally, the experience of their members and in particular of their chairmen. If some parish councils have not taken advantage of all the powers they possess, that does not mean that we should treat them lightly. Having read the clause, I had some misgivings on the lines of those expressed by the noble Lord, Lord Holford. I was wondering whether the interests of the applicant were perhaps not going to be encumbered by this procedure, but even though the drafting of this clause might not be as good as it could be, that does not mean we ought not to do something. I am sure we ought not to leave things as they are, and after hearing the two speeches in the interests

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of the county councils by the noble Lord, Lord Pargiter, and the noble Viscount, Lord Gage, I became convinced that this House ought to do something in the interests of the parish councils. I hope my noble friend will forgive me for interrupting as I did, but it is in fact the case, as any Member of Parliament would confirm, that after—not necessarily before, but after—decisions have been given the disappointed people write to their Member of Parliament, because they feel that the planning committee of their local authority will say, "We have looked into this carefully and we have come to what we believe is the right decision".
I am not going to be drawn into another discussion about something that happened at one time in what was my constituency. I believe the case which has been quoted is a difficult one, and I doubt whether the key to the whole solution would have rested with the parish council. On the other hand, that does not mean that there is not considerable merit in this clause and the idea that lies behind it, and I am sure we should do what we can to encourage parish councils to take a greater interest in this very important part of what ought to be their work.
LORD CHORLEY: I find myself very much in sympathy with the noble Lord, Lord Inglewood. This clause seems to me altogether too complicated. It seems that there is great value in the parish council being seized of these matters. At the Council for the Preservation of Rural England we have frequently found parish councils bringing this sort of matter to our attention, and it has quite often enabled us really to take hold of a matter which was of very great importance from the point of view of safeguarding of the English countryside. I should have thought this could have been secured by a mere notification, making it necessary that a copy of the application be sent to the parish council interested without all the complications provided by this particular proposal. I should have thought that this would get rid of a great deal of the objections very properly put forward by a number of noble Lords who are very experienced in these planning matters. Obviously, as Lord Gage said, the whole object, or one of the basic objects, of this Bill is to simplify the planning
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arrangements, and this obviously adds a cog there; and I should have thought it could have been got rid of, and that the sponsors of this Amendment might withdraw it and put down something simpler to secure the object without adding to these complications. I should have thought this would provide a solution.
LORD SILKIN: I hope this Amendment will not be pressed. I feel that the introduction of the parish councils in these matters is really the fifth wheel to the coach. I have no doubt that has already been said. The fact is that an application goes to the county council; it then goes to the district council who are their agents and already the county council are obliged to hear the comments of the district council. If now you add the parish council as well it is really going to complicate things. In fact anybody can object to a planning application; there is no difficulty about making representations to the county council or the district council if a planning application is regarded as being one which will adversely affect an individual or a community. And there is no difficulty about it becoming known. I hope very much that this Amendment will not be accepted either in principle or in any other way. Apart from the fact that the whole question of administration is in the melting pot, it would he much more difficult if there were three local authorities to deal with rather than two.
LORD BROOKE OF CUMNOR: There is a genuine problem here, as my noble friend Lord Gage clearly realised. I feel that I must speak up for him. I cannot agree with the noble Lord, Lord Silkin, that these things will get known in good time. The truth is that they do not. Some years after he retired from active membership of your Lordships' House, I remember going to stay with a greatly respected former Member of this House, Lord Woolton, at the village to which he retired. I found him and all the inhabitants of the village furious at a decision having been taken above their heads which was going materially to alter the character of the village and on which the parish council had neither been consulted nor even informed. These things happen, and it is desirable that there should be a safeguard against them. Nobody wants to over-burden the whole system, but so

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far as I can see the new clause moved by my noble friend Lord Grimston is very closely modelled on what is working smoothly and satisfactorily on a non-statutory basis in Oxfordshire and not causing difficulty to the applicant (whom the noble Lord, Lord Holford, very rightly reminded us we should consider) or to the county council as the planning authority.
I was a parish councillor once. I have not been one for nearly forty years, so I do not think I need declare an interest there. I live in a small village, and having moved from a great city to a small village I am so conscious of the extent to which the character of a village can be drastically altered by a decision, which may be taken without the local people having had any opportunity to express a view on it. Maybe the decision was a right one which had to be taken for overriding reasons. But that is no ground for arguing that there should have been no public participation in this locally.
The reason why I hope so much that the Government will be able to offer some constructive solution to this problem is that the Minister of Housing and Local Government, when moving the Second Reading of this Bill in another place on January 31 of this year (I quote from column 1362 of Hansard) said:
"Above all, I am determined that there should be more real public participation in planning. I want people to have a much better chance of being involved in the planning of the area they live in, and of influencing it."
I commend the Bill for what it does to that end in Clauses 3 and 7. But those clauses are concerned with development plans and local plans; whereas what is overwhelmingly important to many a village is the individual planning application on which the planning authority has to take a decision. It is just as important that the people in that village who are going to live with the development, should have the opportunity of expressing a view before a decision is reached, as that the people in great cities and smaller towns shall be able to express views on the structure plans and local plans. There is a genuine problem here, and I think that the noble Lord, Lord Kennet, will appreciate that, despite one or two opposing speeches, the majority view in this debate is that a constructive solution should be found by the Government.
LORD SILKIN: May I ask the noble Lord this question? Does he not think that the district councils, to whom planning is delegated in the vast majority, if not all, cases, are in a position to deal with the very thing that this Amendment seeks to do? After all, the district council consists of people from all parts of the district or area, including the village which may be affected. Surely they are in a position to know what is going on.
LORD BROOKE OF CUMNOR: I would entirely agree, if we were all perfect in this world. But there are many district councillors who have not all the time in the world to go round to each village in the area they represent, to look at what is going to be the effect of proposed developments, and to consult the people in the village. I agree entirely that in an ideal world this would happen. I am sure that the noble Lord, with his experience of local government and planning, will agree that we cannot count on all district councillors being universally wise and universally energetic.
LORD ILFORD: Surely anybody who objects to a proposal writes readily to his district councillor and tells him what his objections are.
LORD BROOKE OF CUMNOR: Yes. But you cannot write and object if you have not heard what the proposal is.
BARONESS EMMET OF AMBERLEY: May I say just one word in support of what the noble Lord, Lord Brooke, has said and in contradiction of what the noble Lord, Lord Silkin, said? District councils often do not consult parish councils before a decision is taken. That is the trouble. I have been on a parish council, a county council and a town planning committee for several years; and I know that often there is a lack of communication between the district council and the parish council, in spite of the fact that there might be a representative from the village concerned on the district council. Things sometimes happen so quickly that a decision is taken before the parish has a change of seeing a proposal, or of objecting to it, or of suggesting alterations. I am sure it is this lack of communication that needs to be put right.
LORD CHORLEY: I should like to add one word in reply to my noble friend Lord Silkin. In England, local conditions differ enormously from one part of the country to another. I know parts of the North of England where villages are small, and the idea of having a district councillor living in each village, or, as is frequently the case, a hamlet, is just unrealistic. In other parts of England the villages are large, and no doubt there are district councillors in a great many of them. But what we need is an arrangement that satisfies the requirements of the whole country and is not applicable just to those parts in which the villages are large and there are local district councillors.
5.16 p.m.
LORD KENNET: As in every Amendment and clause of this Bill, we find ourselves in a situation where I think all sides of the Committee are agreed on what ought to happen. I do not suppose any noble Lord present would dissent from the proposition that every citizen ought to be able to know of any planning proposal which is going sensibly to affect the quality of his life.
It is our purpose to reach this situation. What we are in disagreement about—and I must say at once that I disagree with the noble Earl and his Amendment —is whether this situation can most expeditiously and justly be reached by writing certain statutory obligations into the Town and Country Planning Bill. I think it cannot, for various reasons. First of all, there is the question of whether or not there is an extra cog in the machine if the Committee adopt this Amendment. No noble Lord has mentioned that although all the district council have to do, apparently, is to sit back and receive the observations of the parish council if the parish council wishes to send any (if you put it like that, it sounds quite simple and something which is not going to add to anybody's burden) as the new clause is drafted, first of all, it makes it obligatory for notification to be given by the applicant to the parish council. That is a burden of the applicant: Lord Holford's point.
It then enables planning authorities to make a scheme for defining types of application for which notification would not be needed. These schemes would only become compulsory when the majority
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of the parish councils in an area have acceded to them. That is to say, first of all, all applicants have to tell the parish councils about everything. Then, because that is going to be too much (and the noble Earl admits it is too much) the planning authority have to sit down and say, "We do not think that the following sorts of cases need be communicated to parish councils". They have then to present a draft list of the sorts of cases to the parish councils. They have to wait until 80 per cent. of the parish councils have agreed with the draft list. They can then compel the other 20 per cent. to agree not to receive applications on these. I ask your Lordships, is this or is this not a cog in a machine? I think it is certainly adding a big cog to the machine. As it is seen by the planning authorities it is quite a big cog.
Then there is the question of the Report of the Management Study on development control. I do not think this is of the highest relevance, because although they talked about the possibility of consulting parish councils, they did not talk of the possibility of informing the parish councils. They said that that would be a bad plan because it would "gum up the works". It is only common sense to say that if that would "gum up the works" to a certain extent, then a duty to inform them would also "gum up the works", to a lesser extent. If you bring them in at all the extent will be less, but it is still adding a complication.
Now let us turn to the position of the applicant. It is said that all he has to do is to fill in one more copy of his application and send it off to the parish council.
THE EARL OF KINNOULL: Not one more copy of the application. It is a separate, small application, asking four questions: it is not the huge application in triplicate.
LORD KENNET: A separate small application, the form for which I think he would get from the planning authority. That is one more thing for the planning authority to do: they must have a separate form. Then he will have to find out where the parish council is, and whether there is one. That is going to be more work for him—unless indeed the planning

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authority were to adopt the wise precedent set by the Oxfordshire County Council and have on the back of this application form a list of all the parish councils, in which case it would he more work for the planning authority again to get that list and keep it up to date.
That is all very well. The applicant has sent his special small form to the parish council, but what happens in the very common case where he gets into a negotiation with the planning authority? The planning authority say, "No, you cannot do that, but if you change it this way and that way, it will be O.K."; and he puts in an amended application. He then has to go back and tell the parish council again. But supposing the parish council liked his first one and did not like his second one, then the planning authority would have to wait for their observations. They would realise that they had run into the objections of the parish council simply because of what they had said to the applicant about his amending his plan, and possibly the county councillor, or district councillor who represents the parish concerned would urge the case of the parish council against the amended plan, and so on. I think it is difficult to sustain the argument that this procedure would not complicate the machinery.
THE EARL OF KINNOULL: Will the noble Lord allow me to intervene? I apologise for interrupting. What we are talking about is a 14-day period, and I believe I am right in saying that most local planning authorities require 14 days before an application can be considered by their sub-committee. During that 14-day period you have plotting and registratiton, the necessary consultations with the county surveyor on the highway problems, and so on. It is during this period of their own consultations that the parish council have the opportunity of making their comments.
LORD KENNET: That is no doubt so, but I think it does not affect what I was saying about the complications of letting the parish council know again if there is a negotiation between the applicant and the planning authority. Such is the view not only of the noble Lord, Lord Holford, who has a good deal of experience of these matters, but also of the two institutions in the country which are per-
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haps best qualified to speak for applicants as a class, because their members have to submit so many applications—I refer to the Confederation of British Industry and the National Federation of Building Trade Employers. They know what it is to apply for planning permission, and how much work it is. And they are of the opinion that this Amendment would add to it and are therefore against it. Given the diversity of the parish council system it seems to the Government better to leave it to voluntary notification. However, I am coming in a minute to something constructive.
As the noble Earl said, there are something over 10,000 parishes in the country. They vary in population from a handful, or two handfuls, at one extreme, up to tens of thousands, in the case of the very biggest parishes. They vary in area from a few acres to, in some cases, nearly 100 square miles. Of that total of 10,000-plus parishes, about 3,000 have no parish council at all, and parish councils are not required by law to meet more than four times a year. Now this gives a patchwork of very different sorts of parish councils, or of absence of parish councils, as part of the wealth of local government in England; and we have the highly variegated grass roots of this country. It seems to me that, given this enormous variety and given the added work, it would be better to leave this notification on the voluntary footing that obtains at present, rather than to seek to apply a statutory duty which, I submit, would be notable as much by the exceptions that would have to be made to it as by the degree to which it could be observed.
Several noble Lords have said that it is the policy of the present Minister, and has been the policy of several preceding Ministers, to favour voluntary information of planning applications to parish councils. I confirm that this is still the policy, and that it will be the business of the Government to make this clear in an appropriate way after the Bill is through. The noble Earl rather brushed the point aside, but I think there also a point about the right kind of consultation with parish councils being a t the stage when the development plan is being produced.
Virtually all the discussion this afternoon I think has been about villages.

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Nobody has talked about the large urban parish, and I do not imagine many people would hold that with an urban parish with a population of 10,000 or 20,000 that it is important that the parish council should be consulted over every single proposed development in it. But consider the development plan for a village which will say whether or not the village is to be increased in size. It will say whether or not there is to be in-filling in the village. It will say whether or not there are to be extensions behind that village street, or in one corner, or out into the fields in one direction. It will say whether or not new development in the village is to use local stone or to observe any special style of architecture in accordance with the tradition there. It will say all these things. The people who live in the village will have the opportunity of saying through their parish council, if they have one, "We don't like this", or "We do like that". They will be able to talk it out and the decision will be reached. After that they will know that applications for single developments will be allowed or disallowed in accordance with their policy. They will not be surprised to see in-filling in local stone going on, or to see no in-filling going on because there is a marsh there, or a nice duck pond, but a housing estate going out in this direction. They will not be surprised about this because they will know all about it under the new style development plan.
LORD BROOKE OF CUMNOR: Could the noble Lord clarify one thing. He has been speaking about development plans. The development plans are disappearing and under this new Bill we are to have structure plans and local plans. Surely a structure plan will not go into such detail as to the type of facing to be used in a particular village. As to local plans, we have no assurance that there will be local plans extending over all the villages in every county.
LORD KENNET: I apologise. It is due to my neo-classical education; I was speaking a nearly dead language. I should have said structure plans and local plans. As a matter of fact, the new language is coming in by degree and the old style development plans will continue for a time, possibly for a longer time in rural areas than in cities. Even under
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the new plans we certainly hope that planning authorities will produce local plans which will show precisely this sort of point; or, if they do not, they will even show up on the structure plan. There is no reason why they should not. But parish councillors will be on firm ground in demanding that there is some plan in operation which will show this.
May I come now to what ought to be done. I agree with those noble Lords who have said that the right answer to this is to make the district councils real. District councillors ought to be doing this job. If they do not, their electors ought to insist that they do. Where planning is not delegated by the county council to the district council in the countryside, this is of course a more difficult problem, but where a county council chooses not to delegate, it must accept the duty of seeing, through it own councillors, that people are informed by their councillors of the kind of things which are going to interest them.
The noble Lord, Lord Brooke, objected to this and said that that would be all very well if all men were perfect, and that district councillors were not perfect, at any rate not more perfect than other men. To this I would answer nor are parish councillors. It is conceivable that the parish councillor himself would not get round to telling everybody in the village. It would he easier for him to do so, but in a very large parish he might find it difficult. He might find it as difficult as a district councillor in a rather small district council with delegated planning powers. It all fits together in such diverse ways in different parts of the country that it would be really wrong to put down this blanket statutory obligation. There will be a circular of advice from the Minister to all planning authorities about how this new system should be worked when the Bill is through. The best solution to this problem, which is a real one, is that there should be words in the circular to bring home to planning authorities the desirability of keeping parish councils aware of planning applications which affect the look of their parishes. I can assure the Committee that that will be done.
LORD GRIMSTON OF WESTBURY: As I originally introduced this clause on behalf of my noble friend, may I say that

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although we have had an interesting discussion on this matter, in the back of my mind is the thought that in matters of planning it is important that people who are to be most affected by what is going to happen should at least know about it. That was the underlying object of this new clause. I was interested to hear what was said by the noble Lord, Lord Holford. I have great sympathy with him, since he speaks with considerable knowledge as somebody who makes planning applications. He seemed to think that this was a comparatively simple problem and that all one had to do was to see that it was on the form that the parish council should be informed.
It may be said that this new clause is a cumbersome and tiresome way of covering this matter, but I must confess that a great many of the arguments put by the Minister in attempting to destroy this new clause were almost to the effect that the parish council should not be brought in at all. But I know that that was not his object. I do not wish to delay the Committee, but it has emerged from this discussion that there is a problem in this respect. I therefore suggest that, if my noble friend agrees, the Amendment might now be withdrawn on the understanding that further thought is given to this matter and that if we cannot find an agreeable solution we may return to it at a later stage. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 67 agreed to.
Clause 68 agreed to.
Clause 69 agreed to.
LORD KENNET LORD KENNET moved, after Clause 69, to insert the following new clause:
Procedure in connection with making and confirmation of tree preservation orders
(".—(1) The provisions which may by virtue of subsection (1)(c) of section 29 of the principal Act (tree preservation orders) be applied by such in order in relation to any consent thereunder shall include section 69 of this Act.
(2) Regulations made by virtue of section 29(5) of the principal Act may (without prejudice to the generality of that subsection) make provision as follows:—

(a) that, before a tree preservation order is submitted to the Minister for confirmation, notice of the making of the order shall be given to the owners and occupiers of land affected by the order and to such
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other persons, if any, as may be specified in the regulations;

(b) that objections and representations with respect to the order, if duly made in accordance with the regulations, shall be considered before the order is confirmed by the Minister;

(c) that, if no objections or representations are so made, or if any so made are withdrawn, the order may, instead of being confirmed by the Minister (as required by section 29(4) of the principal Act) be confirmed (but without any modification), as an unopposed order, by the authority who made it; and

(d) that copies of the order, when confirmed by the Minister or the authority, shall be served on such persons as may be specified in the regulations.")

The noble Lord said: I beg to move Amendment No. 73. At the moment all tree preservation orders made by local authorities have to be confirmed by the Minister before they can have permanent effect. Local authorities are now making about 1,000 tree preservation orders each year, and of these about three-quarters attract no objections or representations of any sort. Accordingly, this new clause provides that those orders to which there are no objections or representations may be confirmed by the local authority who made them. No change at all is proposed in the rights of those who wish to object. They will continue to make their objections to the Minister as before. I beg to move.
Amendment moved—
After Clause 69 insert the said new clause.—(Lord Kennet.)
On Question, Amendment agreed to.
Clause 70 agreed to.
Clause 71 [Partial abrogation of dual control of office development]:
LORD KENNET: Amendment No. 74 is a procedural Amendment. I beg to move.
Amendment moved—
Page 60, line 8, after ("application") insert ("a copy of").—(Lord Kennet.)
On Question, Amendment agreed to.
LORD KENNET: The object of subsection (2) of Clause 71 is to make it unnecessary to obtain an office development permit for industrial offices for which an industrial development certificate containing a condition limiting

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office space has been issued. But it is an undesirable consequence of that subsection, as it now stands, that such development might in certain circumstances become what is called related development and so have to be taken into account if the same user or developer later made a planning application for a nearby development which was itself below the exemption limit. This Amendment rectifies that undesirable situation. I beg to move.
Amendment moved—
Page 60, line 24, at end insert:—
("(5) Development in respect of which there has been issued by the Board of Trade an industrial development certificate with conditions attached thereto by virtue of subsection (1) of this section shall be treated as not included in any reference to 'related development' in section 2 of the Act of 1965 (which makes an office development permit unnecessary if the amount of office floor space to be created is below the prescribed exemption limit, but for this purpose requires that space to he aggregated with office floor space created or to be created in the course of other development affecting the same building or site).")— (Lord Kennet.)
On Question, Amendment agreed to.
Clause 71, as amended, agreed to.
Clauses 72 to 76 agreed to.
BARONESS SEROTA BARONESS SEROTA moved, after Clause 76, to insert the following new clause:
Transfer of Ministerial functions as to stopping up etc. footpaths and bridleways
(".—(1) Section 153 of the principal Act (power of Minister of Transport to make orders authorising the stopping up or diversion of highways in order to enable development to be carried out) shall be amended in accordance with this section.
(2) The Minister with power under that section by order to authorise the stopping up or diversion of a footpath or bridleway shall, instead of being the Minister of Transport, be the Minister of Housing and Local Government.
(3) Subsection (2) of the said section shall not apply to an order made thereunder by the Minister of Housing and Local Government; but an order so made may make such provision as appears to the Minister to be necessary or expedient for the creation of an alternative footpath or bridleway for use as a replacement for the one authorised by the order to be stopped up or diverted, or for the improvement of an existing path or way for such use.
(4) In relation to an order made by the Minister of Housing and Local Government under section 153 of the principal Act, subsection (3) of that section and section 154 of
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the Act (procedure and publicity for orders under section 153) shall apply with the substitution of references to that Minister for references to the Minister of Transport; and in subsections (4) and (5) of section 153 references to the latter shall be construed as including references to the former.
(5) In this section and in sections 78, (Powers for local authorities analogous to s.153 of the principal Act), (Extinguishment of footpaths etc. over land held for planning purposes) and (Confirmation, validity etc, of orders under two preceding sections) below, "footpath" and "bridleway" have the same meanings as in the Highways Act 1959.
(6) Nothing in this section applies to or affects an order made by the Minister of Transport before the commencement of this section or an order with respect to which he has, before that commencement, published in the London Gazette the notice required by section 154(1) of the principal Act.
(7) This section shall not apply to Wales.")
The noble Baroness said: The purpose of this new clause is to transfer from the Minister of Transport to the Minister of Housing and Local Government the power to make orders under Section 153 of the 1962 Act, authorising the stopping up or diversion of a footpath or bridle-way in order to enable this development to be carried out. The power to make orders stopping up or diverting other highways will remain with the Minister of Transport. I think that the new clause is self-explanatory, but in relation to subsection (7) should the Committee wonder why the clause does not apply to Wales, the reason is that the jurisdiction under Section 153 of the 1962 Act is already with the Minister responsible for planning; namely, the Secretary of State. I beg to move.
Amendment moved—
After Clause 76, to insert the said new clause.—(Baroness Serota.)
On Question, Amendment agreed to.
Clause 77 [Procedure for making orders for stopping-up and diverting highways]:
BARONESS SEROTA: Amendments 77 and 79A hang together, and it may be for the convenience of the Committee if I deal with them together. Amendment 77 is a paving Amendment to expand the reference to subsection (2) of the present clause in order to accommodate the two new subsections which form the subject of Amendment No. 79A. This was foreshadowed in the Standing Committee, and I hope that it will be acceptable to your Lordships. I beg to move.
Amendment moved—
Page 64, line 34, leave out ("subsection (2)") and insert ("subsections (2) to (4)")— (Baroness Serota.)
On Question, Amendment agreed to.
BARONESS SEROTA: The effect of this Amendment, No. 78, is to extend the categories of authorities in respect of whose applications these provisions apply to include the National Coal Board. The National Coal Board are not statutory undertakers and are therefore not included within the terms of the provisions at present. But the Board enjoy the status of a statutory undertaker for some purposes by virtue of the Town and Country Planning (National Coal Board) Regulations 1963. It is therefore felt that they should be included in the list of persons whose applications may be the subject of concurrent procedures with respect to the application to develop and the related draft order for stopping up a highway. I beg to move.
Amendment moved—
Page 64, line 41, after ("undertakers") insert ("or the National Coal Board")—(Baroness Scrota.)
On Question, Amendment agreed to.
BARONESS SEROTA: I beg to move Amendment No. 79A.
Amendment moved—
Page 65, line 6, at end insert—
("() The responsible Minister may publish such a notice as aforesaid where—

(a) the relevant development is to be carried out by a local authority, statutory undertakers or the a National Coal Board and requires, by virtue of an enactment, the authorisation of a government department;

(b) the developers have made application to the department for that authorisation and also requested a direction under section 41 of the principal Act or, in the case of the National Coal Board, under section 2 of the Opencast Coal Act 1958, that planning permission be deemed to be granted for that development.

() The responsible Minister may publish such a notice as aforesaid where the council of a county or county borough, the Greater London Council, tie council of a London borough, a joint planning board, or the Inner London Education Authority certify that they have begun to take such steps in accordance with regulations made by virtue of section 42 of the principal Act (application of planning control to local planning authorities) as are requisite in order to enable them to obtain
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planning permission for the relevant development.")—(Baroness Serota.)
On Question, Amendment agreed to.
BARONESS SEROTA: I wonder whether I may ask your Lordships once again to consider two Amendments together—namely, Nos. 80 and 82. These two Amendments are concerned with the definition of the "responsible Minister", which has to be redrafted as a consequence of the introduction of tile new clause after Clause 76 which I have just moved, transferring jurisdiction from the Minister of Transport to the Minister of Housing and Local Government in respect of Section 153 Orders dealing with footpaths and bridleways. I beg to move.
Amendment moved—
Page 65, line 15, leave out subsection (4) and insert—
("(4) In this section 'the responsible Minister' means, except in relation to Wales,—

(a) in relation to an order authorising the stopping up or diversion of a foot path or bridleway, the Minister of Housing and Local Government: and

(b) in relation to an order authorising the stopping up or diversion of any other highway, the Minister of Transport;

and in relation to Wales means the Secretary of State.")—(Baroness Serota.)
On Question, Amendment agreed to.
Clause 77, as amended, agreed to.
Clause 78 [New powers to authorise stopping-up and diversion of highways]:
5.41 p.m.
LORD CHORLEY LORD CHORLEY moved to aid to subsection (1):
"Provided that in determining to make an order under this subsection the Minister shall have regard to the interest of the users of the subsidiary highway".
The noble Lord said: We now come to an important clause which confers new powers on the Minister in connection with the stopping-up and diversion of highways. Of course, there has been considerable movement in the post-war period in connection with this problem. When I was a young lawyer, it was very difficult indeed to get anything of that sort done, but in the modern community this is obviously very important, and I am sure everybody will agree that these new and considerably wider powers are needed.
This clause is a very valuable one, and your Lordships will see that the Minister is now given very substantial powers in connection with the construction and improving of highways. But in this connection he is, in effect, mandated to look at two matters set out in paragraphs (a) and (b) of subsection (1). He has to look at whether what he is doing is in the interests of the safety of users of the main highway or is to facilitate movement of traffic on the main highway. Of course, that is very important and very useful, but it seems to those of us concerned with the problem of the walker, the cross-country hiker, and those of us who use footpaths and bridleways, that our interests are also very much at stake.
We consider that the clause is too narrow as it stands at the present time and, in effect, confines the matters which the Minister has in mind to the questions of safety of those on the highway or of facilitating movement of traffic upon the highway. Surely the Minister ought also to take into account those who are using the bridleways or footpaths, or even byroads leading into the main road with which the Minister is obviously principally concerned. I imagine that, in practice, the Minister will probably consider these other matters as well, but it seems to us only right that this should, in fact, be provided for in the Bill itself. Therefore, this Amendment has been drafted and I hope that the Minister can see his way to accepting it. I beg to move.
Amendment moved—
Page 65, line 30, at end insert the said proviso.—(Lord Cliorley.)
BARONESS SEROTA: The noble Lord, Lord Chorley, may be aware that an identical Amendment to this was moved in another place at Report stage, and I believe it was withdrawn after discussion on the assurance that it was unnecessary. I hasten to assure him that it is still unnecessary. As I understood his remarks, his concern was in relation to Orders under subsection (1) of Clause 78. Under that subsection the responsible Minister (as defined in Clause 77) has power in certain circumstances to stop up or divert any highway which enters or crosses the route of a highway which is being constructed or improved. The Amendment is designed to secure that, in making an Order under the subsection,
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the responsible Minister shall have regard to the interests of users of the subsidiary highway.
Clause 78(5) applies to these Orders the provisions of Section 154 of the principal Act, and the procedure laid down in that section enables the responsible Minister to take account of the interests of any person affected by the Order and to hold a public inquiry if necessary. I hope that in view of those remarks the noble Lord, Lord Chorley, will agree that there is no need for a specific protection for the "users of the subsidiary highway" or their interests, as they are already covered in legislation.
LORD CHORLEY: I am grateful to the Minister for reminding me of that, although I am quite well aware of it. I am not really surprised that the Government should take this view. However, I suggest it is desirable that this specific direction to the Minister to have regard to this matter should, in fact, be in this clause. It is quite true, of course, that Clause 78(5) of this Bill and Section 154 of the Town and Country Planning Act 1962 contain the terms to which the Minister has referred. None the less, decisions on issues of this nature surely depend on the Minister balancing, so to speak, a number of conflicting interests. As the clause now stands it is quite clear that it is the interests of the users of the main highway which are made paramount, and the interests of the users of the subsidiary highway—the hikers and even the equestrians using the bridlepaths and people of that sort—who really are deserving of consideration are, so to speak, put on one side.
I suggest it should be remembered that, if a stopping-up Order is made, the users of the main highway are simply being enabled to travel faster without very much attention being paid to the interests of the pedestrians and those who like to take their exercise on horses. The result of this over-emphasis, as I suggest, on the traffic aspect on the main highway will undoubtedly be that the interests of the pedestrians and the other people, on whose behalf I am moving this Amendment, will be neglected. In these circumstances, I suggest again to the Government that they should accept this Amendment because it would provide a more balanced situation. I hope

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they will be able to see their way to do so.
BARONESS SEROTA: I am sorry that I have been unable to reassure the noble Lord, Lord Chorley. I speak as a hardened pedestrian and one who is therefore very much biased in favour of the users of subsidiary highways, as opposed to those who wish to speed along motorways. I am sure my right honourable friend will take due note of the noble Lord's remarks, and will exercise his powers bearing in mind the interests of all affected by any change, be they on the major or the subsidiary highway. But I can only repeat what I said at the outset: namely, that there is no need to embody the principle in this legislation as it already exists. In those circumstances, I hope the noble Lord will withdraw his Amendment.
LORD CHORLEY: I am very disappointed. This is a very simple Amendment which the Government could quite easily have accepted, but I do not wish to push it against that decision. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
BARONESS SEROTA: I beg to move Amendment No. 82.
Amendment moved—
Page 65, line 30, at end insert—
("(2) In this section and section 79 below, `the responsible Minister' means, except in relation to Wales, the Minister of Transport and, in relation to Wales, the Secretary of State.")—(Baroness Serota.)
On Question, Amendment agreed to.
5.50 p.m.
LORD ILFORDmoved in subsection (2), after "authority" where that word occurs a first time, to insert "or a highway authority". The noble Lord said: I beg to move Amendment No. 83, and it might be for the convenience of the Committee to discuss Nos. 84 and 85 at the same time. The noble Lord was pointing out a moment ago that Clause 78 gives the local authorities very important new powers to close or stop up highways.
The Bill provides that upon the application of the local planning authority the Minister may change to a footpath or a bridleway a highway over which the public has the right to pass with vehicles.
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That means the Minister will be able to form what are called pedestrian precincts and to restrict the use of the highway to pedestrians. I believe that process is sometimes called "pedestrianisation"— I do not know what my noble friend Lord Conesford would say to that expression, but it is a very convenient way of explaining what is being done. Local authorities have been pressing for these powers for a long time. Indeed, a number of local authorities have promoted private Bills in order to obtain them. But a difficulty arises as to whether the power to make representations to the Minister should be restricted to the local planning authority or whether the highway authority should have the same powers, so that representations may be made either by the local planning authority or by the highway authority.
Of course, in a county borough where the authority is the same it makes no difference. But in the counties, the position is quite different. There, the county council are the planning authority and the district council the highway authority. The Amendment seeks to bring in highway authorities as well as local planning authorities so that either would be entitled to approach the Minister and set the machinery in motion.
The rather anomalous situation the Bill creates is this. The highway authorities already have very similar powers under the Road Traffic Regulations Act 1967. They can exercise those powers as the traffic management authorities in the interests of controlling the traffic. They cannot exercise them to secure or form amenities in their areas. What the highway authorities desire to do is to be able to exercise these powers for amenity purposes, as they do now under the Road Traffic Regulation Act for road management purposes. They desire to be able to exercise these powers for planning purposes in improving the amenities of their neighbourhood. It is altogether anomalous that they should have substantially the same powers for one purpose and not be able to use them for another. This is really the sort of legislation which makes local government law look so very obscure and which pm events the public from understanding it. People just do not understand why the county planning authority should be able only

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to exercise these powers in the interests of planning and that the highway authority, who have very similar powers, should be restricted to exercising them only for traffic management. I hope your Lordships will take that view and that the power to make representations to the Minister on amenity grounds to close a highway will be extended to the highway authorities. I beg to move.
Amendment moved—
Page 65, line 31, after ("authority") insert ("or a highway authority")—(Lord Ilford.)
BARONESS SEROTA: As the noble Lord, Lord Ilford, has pointed out, these three Amendments really hang together. As I understand him, he is making a plea in these Amendments for either the local planning authority or the highway authority to be enabled to initiate action and to apply to the responsible Minister to change a highway into a footpath or bridleway. As noble Lords are aware, and indeed as the noble Lord, Lord Ilford, has pointed out, in many cases highway authorities and planning authorities are in fact the same body and this problem does not arise except in terms of inter-departmental consultation.
Quite irrespective of this, it is the Government's view that it would be wrong to place the initiative in the hands of the highway authority, in view of the purposes which this provision is intended to serve. The proposal giving rise to changing highways into pedestrian-ways—the word I should use in preference to "pedestrianisation"— must surely be one to improve the amenities of the local authority area, including highway questions, and it is surely, in its widest aspects, a planning decision.
Clearly, the proposal affects traffic matters. The highway authority must be consulted, but it is their responsibility to take the initiative where the decision depends upon the appraisal of the full range of planning matters, and it will be the responsibility of the planning authority alone to adopt the proposal for improving amenities of the area. In these circumstances it must surely be for them to pursue the necessary action flowing from that proposal.
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For the reasons I have given, I hope the noble Lord, Lord Ilford, will not press this Amendment. I appreciate his concern and I think I know what he is aiming at. I think we have the same objects at heart; namely, that there shall be the closest possible consultation between the highway authority and the planning authority in matters of this kind. But it is our view that the local planning authority should be responsible for taking the initiative in the development and improvement of amenities in the areas.
LORD ILFORD: The noble Baroness has not given me very much. I am bound to say that I cannot follow her in regard to these two functions of the exercise of planning powers and the exercise of highway powers and I cannot believe they are as different as she seems to think. I have no wish to press the amendment on the Committee, and in those circumstances I ask for leave to withdraw it.
Amendment, by leave, withdrawn.
BARONESS SEROTA: The effect of this Amendment is to replace the provision for regulations on this point under the Bill and to substitute a reference to regulations made under the 1962 Act. The intention is that the arrangements and procedure for claiming compensation should be identical with those under the 1962 Act; and it will be a convenience to claimants and their advisers if the matter is dealt with in the same body of regulations made under the 1962 Act. I beg to move.
Amendment moved—
Page 66, line 6, leave out from ("authority") to end of line 7 and insert ("within the time and in the manner prescribed by regulations under the principal Act").—(Baroness Serota.)
On Question, Amendment agreed to.
Clause 78, as amended, agreed to.
6.0 p.m.
BARONESS SEROTA BARONESS SEROTA moved, after Clause 78, to insert the following new Clause:
Powers for local authorities analogous to section 153 of principal Act
" —(1) Subject to section (Confirmation, validity etc. of orders under two preceding sections) below, a competent authority for the purposes of this section may by order authorise the stopping up or diversion of any footpath or bridleway if they are satisfied that it is

713
necessary to do so in order to enable development to be carried out—

(a) in accordance with planning permission granted under Part III of the principal Act or the enactments replaced by that Part of the Act; or

(b) by a government department.

(2) The competent authorities for the purposes of this section are—

(a) the local planning authority; and

(b) in relation to development for which planning permission was granted by another authority to whom had been delegated the power of granting it, that other authority.

(3) An order under this section may, if the competent authority are satisfied that it should do so, provide—

(a) for the creation of an alternative footpath or bridleway for use as a replacement for the one authorised by the order to be stopped up or diverted, or for the improvement of an existing path or way for such use;

(b) for authorising or requiring works to be carried out in relation to any footpath or bridleway for whose stopping up or diversion, creation or improvement, provision is made by the order;

(c) for requiring any person named in the order to pay, or make contributions in respect of, the cost of carrying out any such works.

(4) The powers of a competent authority under this section shall include power to make an order authorising the stopping up or diversion of a footpath or bridleway which is temporarily stopped up or diverted under any other enactment.
The noble Baroness said: This new clause and the next following new clause give effect to undertakings given in another place on the Third Reading of the Countryside Bill and the Report stage of the Town and Country Planning Bill. I should also like to draw your Lordships' attention to the fact that they connect with Amendment No. 90 and with the new schedule set out as Amendment No. 103. I beg to move.
Amendment moved—
After Clause 78, insert the said new clause. —(Baroness Serota.)
On Question, Amendment agreed to.
BARONESS SEROTA: This new clause empowers a local authority holding land for planning purposes to extinguish a footpath or bridleway over that land subject to a provision for an alternative right of way where that is thought necessary. I should perhaps add that Section 155 of the 1962 Act confers an identical power on the Minister. I beg to move.
Amendment moved—
After Clause 78, insert the following new clause:
Extinguishment of footpaths etc. over land held for planning purposes
—(1) Subject to section (Confirmation, validity etc. of orders under two preceding sections) below, where any land has been acquired or appropriated for planning purposes and is for the time being held by a local authority for the purposes for which it was acquired or appropriated, the authority may by order extinguish any public right of way over the land, being a footpath or bridleway, if they are satisfied that an alternative right of way has been or will be provided, or that the provision of an alternative right of way is not required.
(2) Any reference in subsection (1) above to the acquisition of land for planning purposes is a reference to the acquisition thereof under section 68 or 71 of the principal Act or section 26 of this Act; and any reference to the appropriation of land for planning purposes is a reference to the appropriation thereof for purposes for which land can, or could have been, acquired under those sections. —(Baroness Serota.)
On Question, Amendment agreed to.
BARONESS SEROTA: I beg to move Amendment No. 90, and in moving it I should like to point out that your Lordships may wish to consider this clause in association with the new Schedule set out in Amendment N D. 103. I beg to move.
Amendment moved—
After Clause 78, insert the following new clause:
Confirmation, validity, etc., of orders under two preceding sections
—(1) An order under section (Powers for local authorities analogous to s. 153 of principal Act) or (Extinguishment of footpaths etc. over land held for planning purposes) of this Act shall not take effect unless confirmed by the Minister, or unless confirmed, as an unopposed order, by the authority who made it.
(2) The Minister shall not confirm any such order unless satisfied as to every matter of which the authority making the order are required under section (Powers for local authorities analogous to s. 153 of principal Act) or (Extinguishment of footpaths etc. over land held for planning purposes) (as the case may be) to be satisfied.
(3) The time specified—

(a) in an order under section (Powers for local authorities analogous to s. 153 of principal Act) above as the time from which a footpath or bridleway is to be sopped up or diverted; or

715

(b) in an order under section (Extinguishment of footpaths etc. over land held for planning purposes) above as the time from which a right of way is to be extinguished,

shall not be earlier than confirmation of the order.
(4) Schedule (Procedure in connection with orders relating to footpaths and bridleways) to this Act shall have effect with respect to the confirmation of orders under section (Powers for local authorities analogous to s. 153 of principal Act) or (Extinguishment of footpaths etc. over land held for planning purposes) of this Act and the publicity for such orders after they are confirmed."—(Baroness Serota.)
On Question, Amendment agreed to.
Clause 79 [Miscellaneous amendments of Part IX of principal Act]:
LORD CHORLEY LORD CHORLEY moved to add to subsection (1):
"and shall include provisions requiring the applicant to erect at his own expense a direction post on any length of highway diverted by virtue of such an Order".
The noble Lord said: Clause 79 is directed to making a number of amendments to Part IX of the principal Act. This Amendment is intended to make a small improvement. It may be argued—I expect the noble Baroness will argue—that it does not follow on very logically at the end of the first subsection of Clause 79 that it is not concerned with what is in that subsection, and deals with a different matter. I suppose that it might have been better to put it in as a new subsection, but I am afraid I had placed it on the Paper before I quite appreciated that this was so.
The point arises in this way. When land is developed, very often what one might call the footpath pattern has to be altered, and in the principal Act arrangements are provided under which new routes of paths can be set out and the footpath pattern altered in that sort of way. I understand that in this situation the Minister frequently makes a request to a planning applicant to erect signposts, which obviously will be very useful. I am informed that these requests by the Minister are generally agreed to by developers. It is very much in the developer's interest, I suppose, to do so. To erect signposts at this stage will very often save him £4 or £5 each signpost, rather than wasting time and indeed money when he possibly has to do it later on.
But the important point is that at the moment the Minister seems to have no power to direct a developer to do this. The Minister merely makes a request, and I gather that from time to time these requests are not met. It may well be that it is just carelessness by the developer, but there clearly ought to be a power of this kind. At present, the Minister may make an order containing—and this is a quotation from the existing law—
"such incidental and consequential provisions as appear … necessary or expedient"
to him. That is in subsection (3) of Section 153 of the principal Act. But it is very doubtful whether this includes the power to order the erection of a signpost, and the object of this Amendment is a very simple one. It is to provide the Minister with the necessary power to do so. I beg to move.
Amendment moved․
Page 66, line 24, at end insert the said words.—(Lord Chorley.)
BARONESS SEROTA: May I once again hasten to assure the noble Lord, Lord Chorley, that the point he is anxious to establish has already been provided for. I must confess that I myself should have had difficulty in sorting out how and where, but I am advised that Section 153 of the principal Act, which applies to orders under Section 153 and, by virtue of subsection (5) of Clause 78 of the Bill, to orders under Clause 78, provides that orders may include such incidental and consequential provisions as appear to the Minister of Transport to be necessary or expedient. In these circumstances, both the noble Lord, Lord Chorley, and your Lordships' Committee can be assured that the Minister is advised that there is no reasonable doubt whatever that an order can require the erection of a direction post on a diverted highway at the expense of the applicant. I hope that, with that assurance, and having disentangled the sections and subsections of the various clauses, the noble Lord, Lord Chorley, will withdraw his Amendment.
LORD CHORLEY: I am very glad to know that the Minister's advisers have no doubt whatever that they have these powers. As a lawyer, and having been in consultation with other lawyers, I should not have taken that view. But

717
if the Minister's advisers are quite satisfied about it we can only hope that if the matter ever comes before a court of law the Minister's view will be taken to be correct and not the view which we feel might easily be accepted by a judge. However, in the circumstances I do not propose to press the Amendment, and I beg leave to withdraw it.
Amendment, by leave, withdrawn.
6.8 p.m.
LORD CHORLEY LORD CHORLEY moved, after subsection (2), to insert:
"() An order made under section 153 of the principal Act or section 78 of this Act shall cease to have effect if the relevant planning permission is terminated by operation of section 57 or section 60 of this Act."
The noble Lord said: This is another attempt to give the Minister something which he will no doubt say he does not want. This Amendment is really consequential on Clauses 57 and 60. An order made under Section 153 of the principal Act has the object of creating a new highway network or pattern to serve the proposed development in connection with which the planning application is put forward. It often happens that for one reason or another the development does not take place and the planning permission is terminated by operation of the Statute. In that case it follows that the Section 153 order should also cease to have effect, but it does not seem to he provided very clearly that that should be so.
Indeed, it would appear to be important that this should be done, not only as a matter of filling in what one might call a gap in the drafting but because it might be very important physically, since often the route of a path is diverted in such a way as to be tied to the proposed development. For example, a path might he made to run between the backs of houses, to provide a way down between two rows of houses. That having been done, suppose hat the development is given up and the two rows of houses are not built. It would then seem very important, from a physical point of view, that there should be power in the Act to bring the whole thing to an end. So it is not just a question of drafting tidiness; it might be a matter of practical importance. I hope the Minister will
718
feel that we are offering some help. I beg to move.
Amendment moved—
Page 66, line 28, at end insert—
("() An order made under section 153 of the principal Act or section 78 of this Act shall cease to have effect if the relevant planning permission is terminated by operation of section 57 or section 60 of this Act.")—(Lord Chorley.)
BARONESS SEROTA: I listened with great interest to the arguments of the noble Lord, Lord Chorley. There are, I understand, practical difficulties in writing into the Bill this particular kind of provision. Because of the technical complexities and the rather late hour, perhaps the Committee will not wish me to go into them. We see the possibility of considering the point that the noble Lord, Lord Chorley, has made in relation to footpaths and bridleways where 'we feel the circumstances might be different. Footpaths and bridleways are more often diverted for reasons of smaller-scale development, which may more often fail to come to fruition than the typical large urban project for which a town street is closed.
I suggest that we look at this point between now and the Report stage. But I suggest that this matter would fall rather under Clause 57 than Clause 60. I hope, with that undertaking, that the noble Lord will withdraw his Amendment.
LORD CHORLEY: I am grateful to the noble Baroness for that assurance. Certainly it is the footpaths and bridle-ways aspect of this matter that prompts me to put forward this proposal. In the circumstances I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 79 agreed to.
Clauses 80 and 81 agreed to.
BARONESS SEROTA BARONESS SEROTA moved, after Clause 81, to insert the following new clause:
Miscellaneous amendments of principal Act.
".—(1) Section 187 of the principal Act (power of Public Works Loan Commissioners to make loans to local authorities for the purpose of the discharge of their function; under provisions of the Act specified in paragraph 1 of Schedule 8 thereto) shall cease lo have effect.
(2) An agreement made by the Crown Estate Commissioners under section 200 of the principal Act (whereby a government department may agree with local planning authorities to secure the use of Crown land in conformity with the development plan) shall not require the approval of the Treasury; and accordingly in subsection (2) of that section the words 'the Crown Estate Commissioners or by' shall cease to have effect."
The noble Baroness said: This Amendment, which hangs with Amendments 114A and 114B provides for miscellaneous amendments of the 1962 Act in two separate repeals. I beg to move.
Amendment moved—
After Clause 81, insert the said new clause. —(Baroness Serota.)
On Question, Amendment agreed to.
Clauses 82 and 83 agreed to.
6.14 p.m.
LORD ILFORD LORD ILFORD moved, after Clause 83, to insert the following new clause:
Amendment of existing provisions for appropriation of open space land
"—(1) Any appropriation of land held by a local authority which is or forms part of an open space either

(a) under section 163 of the Local Government Act 1933 (which deals with the power of a local authority to appropriate land) or

(b) by order made and confirmed under subsection (2) of section 73 of the principal Act (appropriation of land for planning purposes)

shall be effective notwithstanding any beneficial interest which, by rule of law or otherwise, the public may have in such land.
(2) Subsection (3) of section 73 of the principal Act shall cease to have effect."
The noble Lord said: The purpose of this new clause is to overcome a difficulty which has caused local authorities a good deal of concern and trouble during the past few years. This appears to be a convenient opportunity to put right something which is in urgent need of putting right. The position is a little complicated, but I will endeavour to make it as clear as I can.
Under Section 163 of the Local Government Act 1963 a local authority which owned open space land in excess of their requirements were able to appropriate it to another purpose. That was done, and things went on merrily, and everybody was quite happy, until 1961 when the courts gave a decision. I am
720
not going to enter into the details of that decision to-night; but the effect of it was that the Minister felt that he was bound to interpret it as meaning that where public rights were enjoyed they could not be overridden by an Act of Parliament which dealt primarily with other matters not directly concerned with modifications of the right of access.
Accordingly, the Minister felt he could not continue with the procedure under which these applications for appropriations were submitted to him by the local authority and to which he gave his consent and under which appropriation could be made. The result is that since 1961 that form of procedure has been impossible and the local authorities have had to find other means of disposing of open space land in excess of their requirements. Normally, they would have to get a modification of the development plan and they would then have to follow special Parliamentary procedure. The whole process was very long, very clumsy and very inappropriate. We hope by this Amendment to put that right.
I should like to give the Committee one or two examples of the sort of difficulties to which this situation has given rise. They illustrate very well what has happened. My first case is of a local authority who wished to appropriate open space which adjoined a public path on a housing estate for housing purposes. The open space afforded ample open space for the housing estate, but the Minister would not agree to the appropriation unless further open land was provided. In another case a similar attitude was adopted in attempting appropriation of allotments where the need for allotments proved to be non-existent—as indeed it is non-existent in many places to-day. In that case the Minister felt unable to follow the old procedure and Special Parliamentary Procedure had to be adopted. Again, any appropriation of open-space land for car parks, or for similar town centre purposes has to go through Special Parliamentary Procedure, if suitable open-space land cannot otherwise be provided.
These cases illustrate the sort of difficulties encountered as a result of the interpretation placed, rightly or wrongly, upon the decision of the courts I hope the Committee will feel that this is a

721
convenient opportunity to put this right and to revert to the procedure which will be the procedure of the Local Government Act 1933. I beg to move.
Amendment moved—
After Clause 83, insert the said new clause.—(Lord Ilford.)
BARONESS SEROTA: The noble Lord, Lord Ilford, has explained that the object of this clause was, broadly, to put the position back to whore it was before the Blake v. Hendon decision. That, I think, is the burden of his argument to-day and the reason he has submitted the new clause for consideration. I think I should be right in saying that this decision altered what had been understood to be the law, because the court decided that the open-space land held in that case was dedicated to the public without the need of a formal act of dedication, so that the local authority's power to dispose of it was subordinate to the public's overriding rights. The construction put upon this decision is that if land is held under any of the Public General open space Acts, and the public have free and unrestricted access to it, then the land cannot, under the 1933 Act powers, be sold, let, exchanged or appropriated for any purpose detrimental to the public's rights.
The only way of effecting a change of use is therefore, as the noble Lord, Lord Ilford, has just pointed out, by means of a compulsory purchase order or appropriation order, which brings into play the machinery of the 1946 Act. Many noble Lords may be aware that the local authority associations do find difficulties on occasions, with the restrictions on their powers, when they wish to dispose of open-space land. But it is the view of the Government that the safeguards for amenity which the 1948 provisions entail should be retained.
On the other hand, it is recognised that the present situation imposes certain constraints on local authorities, and two changes are being made in the Bill to ease the position of local authorities. The noble Lord, Lord Ilford, is probably aware of them. The first is in Schedule 6, paragraph 24, and the second change, which we have already made, is embodied in the new clause to follow Clause 28. This assists the position which is at present concerning local
722
authorities, in that it will amend the ministerial certificate procedure of the 1946 Act so that the Minister may give a certificate and thereby exempt the local authority from going through the Special Parliamentary Procedure for a widened category of cases.
I hope that the noble Lord, Lord Ilford, and the Committee will take the view that these changes, taken together, will ease the position of local authorities which concerns the noble Lord, while reserving the very necessary defence of amenity interests. I also hope that, with this explanation, the noble Lord, Lord Mold, will agree to withdraw his Amendment.
LORD ILFORD: I am not sure how far the noble Baroness has gone to meet my case, but I will withdraw my Amendment now, and examine what the noble Baroness has said. I hope I shun find that it gives us the 1933 procedure, which is what the local authorities really want. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
6.22 p.m.
Loan ILFORD Loan ILFORD moved, after Clause 83, to insert the following new clause:
Parking of vehicles
".—(1) Where planning permission for development of land in the area of a highway authority has been given, the authority may by notice served on the applicant require the payment of such sums as in the opinion of the authority would be the cost per parking space which would be incurred by them if they were to provide a suitable parking space for vehicles, multiplied by such number as does not exceed the number of parking spaces which would otherwise have to he provided to comply with the conditions imposed on the planning permission under which the development is being carried out.
(2) In calculating the cost of prodding a suitable parking place for vehicles the market value of the land needed for such purpose shall be included.
(3) Any person served with notice under subsection (1) may, not later than one month from the date of service of the notice, appeal to the Minister who may confirm the notice with or without modification or determine that the notice shall be of no effect.
(4) On any appeal as aforesaid the Minister shall give the appellant an opportunity of being heard by a person appointed by the Minister."
The noble Lord said: This Amendment deals with a much simpler matter the question of the provision of parking space in new buildings. It often

723
happens that when a planning authority is asked to give consent for a new building, one of the conditions is that garage space should be provided in the building. That is commonly done, but there are cases where the local authority is in a position itself to provide parking space outside the new building in a public car park. If that can be arranged, obviously it is to the advantage of the developer, because he gets the whole of the area of his building available for the purposes of the building and does not have to devote any part to the provision of un-remunerative garage space. It is also to the advantage of the local authority, because it enables the authority to maintain a public parking place perhaps at a lower cost than might otherwise be the case, in a place where it might have been thought to be too expensive in other circumstances.
When a local authority can do that and arrange for a parking space to be provided in a public open space, it goes to the owner of the building to require him to make a contribution to the cost of providing a parking place outside the building. There is no legal sanction for that. Local authorities have no power even to make an agreement of that sort, and the purpose of the Amendment is to give them the necessary power to carry out what they are doing, very reasonably, now, and to provide parking space in their own area, having come to some arrangement with the owner of a building about the contribution which he will make. It seems a sensible and business-like arrangement. I hope that the Committee will say that it should be properly clothed with law and that the local authorities should have power to do this voluntarily if they so desire. I beg to move.
Amendment moved—
After Clause 83, insert the said new clause. —(Lord Ilford.)
LORD SOMERS: I hesitate to disagree with any point raised by my noble friend, Lord Ilford, but one thing occurs to me. On the face of it his suggestion is entirely reasonable, but one must remember that once a house is built with- out a garage one can never be added, because the house is probably too close to the next-door building. Suppose some-
724
thing happens to the covered garage space or it is taken over for other purposes? There are a variety of things which might happen. All the houses built without garages would be permanently without them, as is unfortunately the case with houses in many parts of London to-day. I wonder, therefore, whether this is an altogether entirely safe proposal.
BARONESS SEROTA: I gather that this new clause is an attempt on the part of the noble Lord, Lord Ilford, to enable highway authorities to oblige developers to make a contribution to the cost of public car parks in lieu of the provision of parking space on a development site or, alternatively, on land adjacent which is in the ownership or under the control of the developer. The noble Lord is probably aware that one of the Ministry's planning bulletins, Bulletin No. 7, recommended that, as a voluntary arrangement, it might sometimes be to the advantage of a developer and the public that an increased demand for car-parking engendered by the development should be met in a public car park rather than in a privately-owned one. I understand that occasionally the application of this policy has given rise to difficulties, and a circular issued in August of last year drew the attention of local authorities to the limited scope of this recommendation. The Amendment would remove the voluntary nature of these arrangements.
While we recognise that provision for planning control would be met by the imposition of a condition which it is within the power of the developer to meet, it would enable a highway authority to substitute an obligation to discharge this condition by a money payment, and this, we feel, would be wrong in principle. Also, if this new clause were added to the Bill it would create a new class of appeals to be determined by the Minister. This would run counter to the policy on which the Bill has been drafted, and indeed to the intention of my right honourable friend as expressed in the Bill, which is to reduce the involvement of the Minister in matters of only local significance. If the Amendment were accepted, the Minister would become involved in adjudicating on car park standards which, as I think all noble Lords would agree, is a very local matter.

725
We are all concerned with the problem of car-parking in our cities and it might interest the Committee to know that the parking policy, including the financing of public car parking, has recently been jointly reviewed. My right honourable friend the Minister of Transport will shortly be considering, in the light of the points made in debate on these matters here and in another place, what further action may be taken and what may be necessary to enable local authorities to provide parking facilities commensurate with the capacity of their road system. We feel that the substance of the Amendment is not really a matter for a planning Bill, and I hope, in the light of the explanation I have given of the consequential problems which the acceptance of an Amendment of this kind would cause, and also in the light of the fact that the parking policy as a whole is being reviewed, the noble Lord will feel that his Amendment has served its purpose by initiating a debate on the matter, and that he will be prepared to withdraw it.
LORD BROOKE OF CUMNOR: I am glad that my noble friend raised this matter, because the Guildford Corporation included a clause of this character in their Private Bill in the last Session of Parliament. That clause was disallowed by the Committee in another place, but only on the understanding that the matter should be pursued and dealt with as a matter of urgency. That was more than a year ago and, with respect to the noble Baroness, she seems to have been asked by the Minister of Transport to make a delaying speech on a matter which a Committee of Parliament said more than a year ago should be pursued and dealt with as an urgent matter. I think that my noble friend is right to press the urgency of it. It may be that this is not the right place to deal with it, but I do not think that its importance should be lost sight of, and it would greatly help us if the noble Baroness can say that the Government accept that the point underlying this new clause is an urgent matter which must be dealt with.
BARONESS SEROTA: The noble Lord is quite right in saying that several authorities have sought Private Act powers, usually to give effect to an agreement entered into between developer and
726
local planning authority as contemplated in the voluntary arrangements to which I have referred. The noble Lord is again right. The review promised in another place has been carried out and the recommendations resulting from it are shortly coming before the Minister. It is clear that local planning authorities will need to work out plans both for off-street and on-street parking. We feel that it would be better for a conscious policy to be adopted, including a financial policy, for the provision of public car parks rather than to apply a piecemeal policy if and when development takes place. I think that noble Lords with experience in planning and especially in dealing with this very difficult question of car parking, particularly in congested city centres, would agree that it is better dealt with in a general policy review rather than by adopting an Amendment of this kind which provides merely for a payment of money by a developer to the highway authority.
LORD ILFORD: I think that the noble Baroness intends to convey that this matter is being treated as one of urgency, and in the light of that I ask leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clauses 84 and 85 agreed to.
6.32 p.m.
BARONESS SEROTA BARONESS SEROTA moved, after Clause 85, to insert the following new clause:
Commencement
".—(1) This Act shall come into operation on a day appointed by an order made by statutory instrument by the Minister, and different days may be appointed under this section for different purposes and, in particular, different days may be so appointed for the coming into operation of the same provision in different areas.
(2) Any reference in this Act to the commencement of any provision thereof shall he construed as a reference to the day appointed for the coming into operation of that provision or, in the case of a provision which comes into operation on different lays in different areas, shall, in relation to any area, be construed as a reference to the day appointed for the coming into operation of that provision in that area.
(3) An order under this section may make such transitional provision as appears to the Minister to he necessary or expedient in connection with the provisions thereby brought into force, including such adaptation of those provisions or any provision of this Act then in force as appear to him to be necessary or

727
expedient in consequence of the partial operation of this Act (whether before or after the day appointed by the order).
(4) The Minister of Housing and Local Government shall, for England, and the Secretary of State shall, for Wales, each maintain and keep up to date a register showing the effect of orders made under this section in such a way as enables members of the public to inform themselves—

(a) as to the provisions of this Act which have come, or are to be brought, into operation, and on which dates and in relation to which areas; and

(b) as to whether, in the case of a particular area, any transitional provision has been made by such an order.

(5) The register maintained by the Minister of Housing and Local Government under this section shall be kept at his principal offices in London, and the register so maintained by the Secretary of State shall be kept at his principal offices in Cardiff; and both registers shall be available for inspection by the public at all reasonable hours."
The noble Baroness said: It may be for the convenience of the Committee if I explain Amendments Nos. 93A and 93B together. They both consist partly of material already in the Bill and partly of new material. The first three subsections at present appear as subsections (3) to (5) of Clause 89. The last two are new, and are introduced into the Bill to implement an undertaking given at Report stage in another place. Amendment No. 93B is consequential, following the incorporation of this new clause in the Bill. I beg to move.
Amendment moved—
After Clause 85, insert the said new clause. —(Baroness Scrota.)
On Question, Amendment agreed to.
Clauses 86 to 88 agreed to.
Clause 89 [Short title, citation, commencement and extent]:
BARONESS SEROTA: I beg to move this Amendment.
Amendment moved—
Page 69, line 6, leave out subsections (3) to (5).—(Baroness Scrota.)
On Question, Amendment agreed to.
LORD MERRIVALE LORD MERRIVALE moved, after subsection (3), to insert:
"() Notwithstanding anything in subsection (3) above, the day appointed for the coming into operation of sections 6, 7, 8 and 9 of this Act shall be not earlier than 31st December 1970."
The noble Lord said: I beg to move Amendment No. 94. This Amendment follows up the thought I expounded, in connection with Clause 9 in regard to local plans, on June 18 last. At that time the noble Lord, Lord Kennet, replied:
"I do not think there would be any case for singling out Clause 9 of this Bill for special review in that context,ߪ".—[OFFICIAL REPORT, 18/6/68, col. 635.]
The context he referred to was the repeal of the modifying clauses of this Bill in the light of the recommendations of the Royal Commission on Local Government. I am hoping that since June 18 Her Majesty's Government and the noble Lord have had second thoughts on this matter. I expect that the wording will probably be faulty, but the Amendment is designed to draw from the Government a statement on whether local planning procedure will be modified in the light of the probable reconstruction of local government.
The effect of this new subsection would be to prohibit the Minister from bringing into operation, under Clause 89, those clauses which deal with local plans until the date when it might be expected that the recommendations of the Royal Commission would have been implemented. The date given is of necessity a cockshy, but as it has been announced that the Commission will probably report in the autumn of 1968 this Amendment allows two years for the system to be changed.
Amendment moved—
Page 69, line 11, at end insert the said subsection.—(Lord Merrivale.)
LORD LEATHERLAND: I wonder whether the noble Lord, Lord Merrivale, used words in his speech which mean precisely the same as the words in the Amendment. He said that this would delay, or give an opportunity for delaying, the operation of this clause until after the local government reorganisation scheme had been implemented. Had he said, "Until the time of the Report of the Royal Commission," we could have visualised some action in the next six or nine months. We have been told from time to time that the implementation of this scheme might take five, six or seven years, and to postpone the beneficent features of this Bill for five, six or seven years would, I think, be going beyond what most of us would like to see.
LORD KENNET: I have little to add to what my noble friend has said. There is unfortunately no guarantee that action can be taken on the Report of the Royal Commission by the end of 1970. In an ideal world, one would like to say that two years would be enough. But we know from experience that when a Royal Commission turns in a Report on a matter like this (and we must not forget that this is a survey of the entire system of local government, which has been in operation for nearly a hundred years), its recommendations are not discussed by Government, public and Parliament, or public opinion farmed on them and legislation drafted, passed and brought into effect, in less than two years. It is because the Government know full well that this is not possible that they have introduced this Bill quite a while before a general reform of the local government system can be expected as a result of the Royal Commission's Report.
I would remand the Committee that the Ministers intend to bring the new planning drill contained in this Bill into operation in suitable areas; that is, where the authorities have staff, skill, size,et cetera to do it, and where they are in the right place in the development plan cycle to do it. They plan to bring it into operation before any possible reform of local government, and are convinced that this is a good thing to do. The Government would be reluctant to see those measures postponed until the end of 1970. I hope that with this explanation the noble Lord may see his way to withdraw the Amendment.
LORD MERRIVALE: I can well understand the attitude of the Government on this Amendment. As I said, two years was just a random period, and has no particular merit. If this would delay the adoption of this for a number of years, I agree that it would be most undesirable. Therefore, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 89, as amended, agreed to.
Schedule 1 [Special Provisions as to Development Plans in Greater London]:
LORD KENNET: This is a drafting Amendment. I beg to move.
Amendment moved—
Page 71, line 34, after ("area") insert ("or is to be treated as an action area") —(Lord Kennet.)
On Question, Amendment agreed to.
LORD KENNET: This, too, is a drafting Amendment. I beg to move.
Amendment moved—
Page 71, line 41, after ("area") insert ("or for an area which is to be treated as au action area").—(Lord Kennet.)
On Question, Amendment agreed to.
Schedule 1, as amended, agreed to.
Schedule 2 [General Vesting Declarations for Land Compulsorily Acquired]:
6.43 p.m.
LORD BROOKE OF CUMNOR LORD BROOKE OF CUMNOR moved, after paragraph 9, to insert:
". At any time after a general vesting declaration has been executed in respect of any land a person entitled to compensation arising out of the acquisition by the acquiring authority of his interest in that land may require that authority within fourteen days to pay to him on account of compensation a sum not exceeding nine-tenths of the amount which the District Valuer certifies to be props r compensation in respect of that interest."
The noble Lord said: I attach great importance to the purpose underlying this Amendment, but I have no wish to initiate a lengthy debate on it now for reasons which I will explain. Schedule 2 is linked with Clause 28. They both deal with the general vesting declaration and its effects. When we were debating the Question, That Clause 28 stand fart of the Bill, I expressed grave anxieties about certain people, and particularly owner-occupiers, who might find that they had lost their title to their land under a general vesting declaration, and lost thereby their power to raise money on that title, and remained unpaid by the acquiring authority. That may not matter to some people, but it will normally matter a great deal to owner-occupiers, because they need the money they get by way of compensation for the house they are losing in order to acquire or, at any rate, to pay a deposit on a house elsewhere to which they have to move,.
I raised this point in general terms on the Question, That Clause 28 stand part, and the noble Lord, Lord Kennet, was good enough to say:
"I should just like to say that I will study the noble Lord's remarks with care, and We can

731
revert to this point at a later stage."—[OFFICIAL REPORT, 26/6/68; col 1427.]
I should be quite content if the noble Lord replied briefly in some such terms as those. I think he will recognise that the Amendment I have tabled here, giving a person entitled to compensation the right to claim a payment of nine-tenths of the sum certified by the district valuer on account, is very much in line with the practice which I understand the Ministry of Transport adopt when there is likely to be hardship through quick acquisition of land for road-making purposes. They are prepared to make a nine-tenths payment on account.
This Bill has valuable provisions to which we have already agreed that will empower the public authority which has over-paid compensation to recover the amount that has been overpaid. So it matters less whether you get the exact amount right quickly. I have tabled this Amendment so as to indicate the kind of solution which is passing through my mind, and to fill out in some detail the general proposition to which the noble Lord was good enough to say that he would give consideration at a later stage of the Bill. I beg to move.
Amendment moved—
Page 74, line 31, at end insert the said new paragraph.—(Lord Brooke of Cumnor.)
LORD KENNET: I do not wish in any way to unsay what I said on the clause stand part discussion earlier, but the solution which the noble Lord has put forward is a rather extreme one. It goes wider than what he said, in that it covers all those with an interest in land, and not simply owner-occupiers about whom I thought he was worried. The Amendment is very abrupt and extreme in its effect, in that it requires the 90 per cent. payment to be made 14 days after the execution of the vesting declaration, and that is before the land actually vests in the local authority, which it cannot do under the Bill for a minimum of 28 days. There are many other things about the Amendment which would make it difficult to accept but, as I said a moment ago, I am not going back on anything that I said earlier, and we can refer to this again on the Report stage.
LORD BROOKE OF CUMNOR: I am sure the noble Lord will have appreciated
732
that I did not attempt to tailor this Amendment precisely to the words that I used on an earlier stage. I remain convinced that there is liable to be hardship unless we insert some provision of this kind in the Bill, and I hope that it may be possible to find a solution before the next stage of our proceedings on the Bill along the lines of the practice which I understand the Ministry of Transport have adopted with satisfaction to all concerned. Meantime, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Schedule 2 agreed to.
Schedule 3 [Application for listed building consent]:
LORD KENNET: Paragraph 7 of Schedule 3 is the paragraph dealing with appeals to the Minister against refusals of listed building consent. This Amendment would enable the Minister to prescribe the manner in which, and the period within which, such appeals are to be made. I beg to move.
Amendment moved—
Page 78, line 43, leave out ("under this paragraph") and insert ("served in the prescribed manner within such period as may be prescribed, not less than 28 days from the receipt by him of notification of the decision"). —(Lord Kennet.)
On Question, Amendment agreed to.
LORD KENNET: This is consequential upon Amendment No. 38. I beg to move.
Amendment moved—
Page 83, line 4, after ("so") insert ("in the case of a listed building purchase notice served on account of listed building consent being refused or granted subject to conditions").—(Lord Kennet.)
On Question, Amendment agreed to.
LORD KENNET: This, too, is consequential on Amendment No. 38. I beg to move.
Amendment moved—
Page 83, line 11, at end insert—
("(4) If it appears to the Minister to be expedient to do so in the case of a listed building purchase notice served on account of listed building consent being revoked or modified by an order under Part II of this Schedule, he may, in lieu of confirming the notice, cancel the order revoking the consent, or where the order modified the consent by the imposition of conditions, revoke or amend those conditions so far as appears to him to be required in order to enable the land to be

733
rendered capable of reasonably beneficial use by the carrying out of the works in respect of which the consent was granted ").—(Lord Kennet.)
On Question, Amendment agreed to.
LORD KENNET: This is a consequential Amendment. I beg to move.
Amendment moved—
Page 84, line 41, at end insert—
(". Where in consequence of listed building consent being revoked or modified by an order under Part 11 of this Schedule, compensation is payable in respect of expenditure incurred in carrying out any works to the building in respect of which the consent was granted, then if a listed building purchase notice is served in respect of an interest in the land, any compensation payable in respect of the acquisition of that interest in pursuance of the purchase notice shall be reduced by an amount equal to the value of the works in respect of which compensation is payable by virtue of that paragraph.")—(Lord Kennet.)
On Question, Amendment agreed to.
LORD KENNET: This is a drafting Amendment. I beg to move.
Amendment moved—
Page 86, line 45, leave out ("43(2)") and insert ("43(3) ").—(Lord Kennet.)
On Question, Amendment agreed to.
LORD KENNET: This, too, is a drafting Amendment. I do not need to explain it any more than to say that the words, "and with it", were criticised as obscure and possibly excessively modish in the House of Commons. We have, therefore, improved on them. I beg to move.
Amendment moved—
Page 87, line 7, leave out from ("and") to end of line 8 and insert ("any listed building consent granted with respect to the building, while the notice was in force, shall also lapse"). —(Lord Kennet.)
On Question, Amendment agreed to.
Schedule 3, as, amended agreed to.
6.50 p.m.
BARONESS SEROTA BARONESS SEROTA moved, after Schedule 4, to insert the following new schedule:
("PROCEDURE IN CONNECTION WITH ORDERS RELATING TO FOOTPATHS AND RIDLEWAYS

PART I

  CONFIRMATION OF ORDERS
  1.—(1) Before an order under section (Powers for local authorities analogous to s.153 of
  734
  principal Act) or (Extinguishment or footpaths etc. over land held for planning purposes) of this Act is submitted to the Minister for confirmation or confirmed as an unopposed order, the authority by whom the order was made shall give notice in the prescribed form—

  (a) stating the general effect of the order and that it has been made and is bout to be submitted for confirmation or to be confirmed as an unopposed order;

  (b) naming a place in the area in which the land to which the order relates is situated where a copy of the order may be inspected free of charge at all reasonable hours; and

  (c) specifying the time (not being less than twenty-eight days from the late of the first publication of the notice) within which, and the manner in which, representations or objections with respect to tie order may be made.

  (2) Subject to sub-paragraph (3) below, the notice to he given under sub-paragraph (1) above shall be given—

  (a) by publication in the London Gazette and in at least one local newspaper circulating in the area in which the land to which the order relates is situated; and

  (b) by serving a like notice on—

  (i) every owner, occupier and lessee (except tenants for a month or a period less than a month and statutory tenants within the meaning of the Rent Act 1968) of any of that land,

  (ii) every council, the council of every rural parish and the parish meeting of every rural parish not having a separate parish council, being a council or parish whose area includes any of that lard; and

  (c) by causing a copy of the notice to be displayed in a prominent position at the ends of so much of any footpath or bridleway as is to be stopped up, diverted of extinguished by virtue of the order.

  (3) Except in the case of an owner, occupier or lessee being a local authority or statutory undertakers, the Minister may in any particular case direct that it shall not be necessary to comply with sub-paragraph (2)(b)(i) above; but if he so directs in the case of any land, then in addition to publication the notice shall be addressed to the owners and any occupiers of the land (describing it) and a copy or copies of the notice shall be affixed to some conspicuous object or objects on the land
  (4) Where under this paragraph a notice is required to be served on an owner of land and the land belongs to an ecclesiastical benefice, a like notice shall be served on the Church Commissioners.
  2. If no representations or objections are duly made, or if any so made are withdrawn, the authority by whom the order was made may, instead of submitting the order to the Minister, themselves confirm the order (but without any modification).
  3.—(1) If any representation duly made is not withdrawn, the Minister shall, before confirming the order, if the objection is made

  735
  by a local authority cause a local inquiry to be held, and in any other case either—

  (a) cause a local inquiry to be held; or

  (b) afford to any person by whom any representation or objection has been duly made and not withdrawn an opportunity of being heard by a person appointed by the Minister for the purpose,

  and, after considering the report of the person appointed to hold the inquiry or to hear representations or objections, may confirm the order, with or without modifications:
  Provided that in the case of an order under section (Powers for local authorities analogous to s. 153 of principal Act) of this Act, if objection is made by statutory undertakers on the ground that the order provides for the creation of a public right of way over land covered by works used for the purpose of their undertaking, or the curtilage of such land, and the objection is not withdrawn, the order shall be subject to special parliamentary procedure.
  (2) Notwithstanding anything in the foregoing provisions of this paragraph, the Minister shall not confirm an order so as to affect land not affected by the order as submitted to him, except after—

  (a) giving such notice as appears to him requisite of his proposal so to modify the order, specifying the time (not being less than twenty-eight days from the date of the first publication of the notice) within which, and the manner in which, representations or objections with respect to the proposal may be made;

  (b) holding a local inquiry or affording to any person by whom any representation or objection has been duly made and not withdrawn an opportunity of being heard by a person appointed by the Minister for the purpose; and

  (c) considering the report of the person appointed to hold the inquiry or to hear representations or objections as the case may be;

  and, in the case of an order under section (Powers for local authorities analogous to s. 153 of principal Act) of this Act, if objection is made by statutory undertakers on the ground that the order as modified would provide for the creation of a public right of way over land covered by works used for the purposes of their undertaking, or the curtilage of such land, and the objection is not withdrawn, the order shall be subject to special parliamentary procedure.
  4. Regulations under this Act may, subject to this Part of this Schedule, make such provision as the Minister thinks expedient as to the procedure on the making, submission and confirmation of orders under sections (Powers for local authorities analogous to s. 153 of principal Act) and (Extinguishment of footpaths etc. for land help for planning purposes) of this Act.

PART II

  PUBLICITY FOR ORDERS AFTER CONFIRMATION.
  5. As soon as may be after an order under section (Powers for local authorities analogous
  736
  to s. 153 of principal Act) or (Extinguishment of footpaths etc. over land held for planning purposes) of this Act has been confirmed by the Minister or confirmed as an unopposed order, the authority by whom the order was made shall publish, in the manner required by paragraph 1(2) of this Schedule, a notice in the prescribed form, describing the general effect of the order, stating that it has been confirmed, and naming a place where a copy thereof as confirmed may be inspected free of charge at all reasonable hours, and shall—

  (a) serve a like notice and a copy of the order as confirmed on any persons on whom notices were required to be served under the said paragraph 1(2) or under paragraph 1(4); and

  (b) cause a like notice to be displayed in the like manner as the notice required to be displayed under the said paragraph 1(2):

  Provided that no such notice or copy need be served on a person unless he has sent to the authority a request in that behalf, specifying an address for service."
  The noble Baroness said: The Committee will recall that I mentioned we were tabling this new Schedule when we had our discussion on Amendment No. 90. This Amendment brings in a whole new Schedule in connection with bridle-ways and footpaths Orders and it is closely based on the Seventh Schedule to the Highways Act 1959, which set out the procedure for such Orders. In the Countryside Bill the House has recently been dealing with Amendments to that Schedule to the Highways Act in order to deal with the local confirmation of such Orders when they are unopposed, and that is the provision now required in the planning Bill. The Government thought it would be unsatisfactory in a planning Bill to legislate by reference to another Statute as amended by another Bill in the present Session, so despite the present length of the Bill, which we all agree is terribly long—but happily we are reaching the end of this stage to-night —the Government thought it right to explain the position in extenso, and this is done in the interests of clarity in this Amendment. I beg to move.
  Amendment moved—
  After Schedule 4, insert the said new Schedule.—(Baroness Scrota.)
  LORD CHORLEY: May I congratulate the Government on having taken this line. It has been a constant criticism that there has been too much legislation by reference. I hope this will be the progenitor of many attempts of this kind to clarify the position.
  LORD BROOKE OF CUMNOR: I quite agree with the noble Lord, Lord Chorley. This new Schedule looks a most formidable addition to the Bill, but I think it is to everybody's convenience that it should be set out here, in order to save people having to look it up in two separate Acts of Parliament.
  On Question, .Amendment agreed to.
  Schedule 5 agreed to.
  Schedule 6 [Adaptation and Interpretation of Enactments, etc.]:
  BARONESS SEROTA: This Amendment is consequential on an earlier Amendment. I beg to move.
  Amendment moved—
  Page 92, line 2, at end insert—
  ("The Highways Act 1959 (c.25)
  In section 38(2) (specification of highways which are to be maintainable at the public expense), in paragraph (e), after the words 'public path diversion order' there shall be inserted the words 'or in consequence of an order made by the Minister of Housing and Local Government under section 153 of the Town and Country Planning Act 1962 or by a competent authority under section (Powers for local authorities analogous to s.153 of principal Act) of the Town and Country Planning Act 1968'").—(Baroness Scrota.)
  On Question, Amendment agreed to.
  LORD AIREDALE LORD AIREDALE moved to add to paragraph 9
  " .In section 14(8)(6) after "1959" there shall be inserted the words 'except section 72, 73 and 74 thereof'."
  The noble Lord said: This Amendment is intended to deal with a situation explained in a case, Westminster Bank Ltd. v. Beverley Borough Council, reported in The Times on May 31. An appeal is pending in the case and therefore it would not be right that I should discuss the facts, but I propose to deal with the general situation which the case explains.
  We are here dealing with road-widening schemes and the like. These are dealt with in the Highways Act 1959, in particular in Sections 72, 73 and 74. Section 72 deals with the prescribing of improvement lines for widening streets. Section 73 deals with the prescribing of building lines, and Section 74 deals with a kindred matter. The Highways Act says that in these cases when the street widen-
  738
  ing scheme is prescribed immediate compensation shall be paid to the landowner whose land is injuriously affected by the road widening proposal. No doubt all local authorities would faithfully have followed that procedure laid down in the Highways Act were it not for the existence of a Ministry of Transport Circular, No. 696 of 1954, paragraph 8 of which says:
  "In view of the powers now available to local authorities as planning authorities for the control of development it is no longer necessary for councils to safeguard future road improvement schemes by using their powers … to prescribe building and improvement lines."
  It then cites two earlier enactments which have bean reproduced in t1 e Sections of the Highways Act 1959 to which I have just referred.
  The purpose of this paragraph of the circular is to put local authorities wise to the fact that there appears to be some conflict as between the intention of Parliament as expressed in the Highways Act on one hand and in planning legislation on the other, because, as your Lordships will have guessed, if the planning legislation procedure is followed, the land-owner whose land is injuriously affected does not get immediate compensation, as he would if the Highways Act procedure were followed. Having regard to the time it takes to effect these road improvement schemes it must, in many cases, be that the land-owner for the time being will never in his lifetime receive the compensation to which he ought to be entitled.
  The time has come to resolve this apparent conflict between the intention of Parliament as expressed in two different Statutes, and I would venture to suggest to your Lordships that surely the Highways Act procedure ought to be adopted. Parliament was concentrating upon such matters as road improvement schemes when it passed the Highways Act, whereas when Parliament was dealing with planning legislation it was dealing with all sorts of topics and not particularly with such matters as road-widening schemes.
  What would seem to be quite unfair, and almost intolerable, is that one local authority, feeling, perhaps, generous and law-abiding, should follow the Highways Act procedure and pay the

  739
  landowner immediate compensation, whereas some other local authority, feeling perhaps less generous and taking the hint in the Ministry of Transport's circular to which I have referred, should proceed by the planning legislation procedure and deny the landowner his compensation, perhaps for the whole of his lifetime. What one must surely achieve in matters of this kind is uniformity as between one citizen and another. The treatment he receives should not be allowed to be affected by the whim of the particular local authority with which he has to deal.
  I will not weary your Lordships with the machinery whereby this Amendment seeks to achieve its purpose. Its purpose is to ensure that the will of Parliament as laid down in the Highways Act shall be followed in all cases and that the landowner injuriously affected shall have immediate compensation, which the Highways Act said that he should have. I dare say I shall be told that my Amendment is defective from a drafting point of view. This is not an easy matter to deal with. I shall not be discouraged if I am told that the Amendment is defective, provided that what I seek to achieve can be achieved by a satisfactory Amendment at the next stage of this Bill. I trust I have sufficiently explained the purpose of this Amendment. I beg to move.
  Amendment moved—
  Page 92, line 19, at end insert the said subsection.—(Lord Airedale.)
  7.0 p.m.
  BARONESS SEROTA: The noble Lord, Lord Airedale, explained at the outset that the effect of his Amendment would be to take away the power to make orders removing or restricting the effect of sections 72, 73, and 74 of the Highways Act, 1959, and that his concern arose following the recent court case he mentioned. I am advised that, in spite of the points which the noble Lord, Lord Airedale, has made so cogently, the Government regard the situation left as a result of this case as satisfactory, in that it leaves with the local planning authorities and the Minister powers which it was always assumed they had and which they must have if development control is to be exercised satisfactorily. In these days the planning of development cannot
  740
  be regarded as something separate from the planning of roads—a point which I have noted has occurred time and time again, as this Bill has proceeded through its stages—and we cannot regard them as separate activities to be conducted by a separate authority under separate powers. For many years now local planning authorities have used their powers to control development which would conflict with the construction of new roads and the widening of existing ones, and it is clearly right that they should be able to do so.
  The Highways Act provisions go back to the time before the universal planning powers of the 1947 Act were available to local planning authorities, and are now moribund. Local authorities were in fact advised by the Ministry of Transport, in a circular dated as long ago as 1954, not to use them. The Ministry of Transport are about to consult the local authority associations concerning the repeal of these sections in an early Highways Amendment Bill. Meanwhile, these Highways Act powers are still on the Statute Book, and it seems right that, until they are repealed, the Minister should retain the power to modify their effect by means of a development order if it should so happen that they were to hold up proper development; though it must be conceded that the power has not so far been used and, indeed, is not likely to be used in practice.
  It is felt that the Amendment about which the noble Lord, Lord Airedale, feels so strongly is not necessary to the Bill at this stage. We should like to make it clear that as a matter of principle the Government cannot accept the argument that planning powers are not properly used in those cases where it is necessary to control development which would interfere with road improvements or road construction. As I said, this point has been mentioned at various stages of our discussions. I hope the noble Lord will have second thoughts. We have taken full note of the points he has made, and we shall have time, between now and the next stage of our deliberations, to consider them carefully and calmly in the light of what he has said.
  LORD AIREDALE: If that answer means that there is a likelihood that the Government may consider accepting an

  741
  Amendment at the next stage to achieve what I seek to achieve now, I will of course withdraw this Amendment. I would only say this to the noble Baroness. Am I not right in saying that at the present time it is quite open to a local authority to decide whether to carry out its road widening scheme under one Act and pay immediate compensation; or, if it does not feel very rich, not to pay immediate compensation but to proceed under a different procedure and deny the landowner his compensation indefinitely? Does the noble Baroness think that where different procedures are followed in different local authority areas this is fair as between one citizen and the other? Surely this is a matter which must be resolved so as to have universal and fair treatment as between one citizen and another. If I may have an assurance that this matter will be gone into with a view to an Amendment at the next stage, I shall be very pleased to withdraw this Amendment. But I do seek that assurance.
  BARONESS SEROTA: I do not wish to mislead the noble Lord, Lord Airedale. I should not like him to think that I have given an undertaking that the Government will consider acceptance of an Amendment at the next stage. What I said was that we would read his comments and try to follow his arguments and, if necessary, would come back to this at the next stage. These are highly technical and complicated matters, as I am sure all noble Lords would agree. I would not mislead the noble Lord. I can assure him that we will take careful note of the points made and see what we can do at the next stage.
  LORD AIREDALE: I am very much obliged. I think I have sufficiently ventilated this matter for the time being and I beg leave to withdraw the Amendment.
  Amendment, by leave, withdrawn.
  BARONESS SEROTA: This Amendment and subsequent Amendments are consequential on Amendment No. 23, which we accepted earlier. I beg to move.
  Amendment moved—
  Page 94, line 45, at end insert—
  ("In section 159(1) (determination of applications etc. by statutory undertakers in respect of operational land) after the words 'such an application' there shall be inserted the words or such an application is deemed
  742
  to be made under section 16(7) of the Act of 1968 on an appeal under that section by statutory undertakers'").—(Baroness Scrota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: Amendments Nos. 106 and 107 hang together. They deal with a challenge to the validity of footpath and bridleway orders by bringing them under Part II of the Act of 1962. I beg to move Amendment No. 106.
  Amendment moved—
  Page 97, line 11, after ("153") insert ("or 155").—(Baroness Serota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: I beg to move Amendment No. 107.
  Amendment moved—
  Page 97, line 15, at end insert—
  ("() The said provisions shall apply to an order under section (Powers for local authorities analogous to s. 153 of principal Act) or (Extinguishment of footpaths etc. over land held for planning purposes) of the Act of 1968 as they apply to a structure plan as if, in subsection (1) of this section, for the reference to the date on which the notice therein mentioned is first published there were substituted a reference to the date on which the notice required by paragraph 5 of Schedule (Procedure in connection with orders relating to footpaths and bridleways) to that Act is first published in accordance with that paragraph").—(Baroness Serota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: This Amendment goes with No. 107B. These two Amendments together round off the process of applying sections of the 1962 Act as necessary to the provisions of the Bill. I beg to move.
  Amendment moved—
  Page 98, line 47, at end insert—
  (" In section 205 (ecclesiastical poperty)—

  (a) in subsection (1), the words 'specified in paragraph 1 of the Eighth Schedule thereto' shall be omitted; and

  (b) in subsection (3), after the words 'under Part VII of this Act' there shall be inserted the words 'or under section 18, 44 or 78 of the Act of 1968'").—(Baroness Serota.)

  On Question, Amendment agreed to.
  BARONESS SEROTA: I beg to move Amendment No. 107B.
  Amendment moved—
  Page 100, line 4, at end insert—
  (" In section 215(1) (power to require information as to interests in land), the words

  743
  'specified in paragraph 1 of the Eighth Schedule thereto' shall be omitted.
  In section 217 (regulations and orders)—

  (a) in subsection (1)(a) the words 'specified in paragraph 1 of the Eighth Schedule thereto' shall be omitted; and

  (b) in subsection (3), the words 'specified in paragraphs 1 and 3 of the Eighth Schedule thereto' shall be omitted.")—(Baroness Serota.)

  On Question, Amendment agreed to.
  BARONESS SEROTA: This is merely a tidying-up Amendment. I beg to move.
  Amendment moved—
  Page 100, line 19, at end insert:—
  (" In Schedule 8 (provisions of principal Act listed for the purposes of sections of the Act referred to in the Schedule heading), the following amendments shall be made:
  (a) in paragraph 1(1)—
  for the words 'sections 1 to 12' there shall be substituted the words 'Sections 1 to 3; section 12';
  for the words 'sections 27 to 39; sections 41 to 87' there shall be substituted the words 'sections 27 to 29; section 32; sections 34 to 39; sections 41 to 44; sections 47 to 51; sections 56 to 66: sections 70 to 73; sections 77 to 87'; and
  the words 'section 210' shall be omitted; and
  for the words 'the 1st, 2nd, 3rd and 4th Schedules'; there shall be substituted the words 'the 1st, 2nd and 3rd Schedules';
  (b) in paragraph 3(1) for the words 'sections 138 to 151 'there shall be substituted the words 'sections 138 to 142; sections 144 to 151'")—(Baroness Serota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: Paragraph 54 of Schedule 6 gives the Greater London Council certain functions of a planning authority concurrently with the planning authorities themselves—that is to say, the London boroughs and the City. As drafted, it does not give the Greater London Council the functions of a planning authority under Clause 44 of the Bill. I beg to move.
  Amendment moved—
  Page 101, line 14, leave out ("43, 45 to").—(Baroness Serota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: I beg to move Amendment No. 109.
  Amendment moved—
  Page 102, line 20, at end insert—
  ("In section 16 (interpretation of Part I), in subsection (7), for the words from 'section
  744
  64(2)' onwards there shall be substituted the words 'section 16(7) of the Town and Country Planning Act 1968 is deemed to have been made for such planning permission as is mentioned in that subsection'.").—(Baroness Scrota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: This Amendment is consequential. I beg to move.
  Amendment moved—
  Page 102, line 21, at end insert—
  (". In section 22 (requirement of industrial development certificate in certain cases), in subsection (4) for the words from 'section 64(2)' onwards there shall be substituted the words 'section 16(7) of the Town and Country Planning Act 1968 is deemed to have been made for such planning permission as is mentioned in that subsection'").—(Baroness Serota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: This Amendment is consequential on the new clause after Clause 69. I beg to move.
  Amendment moved—
  Page 103, line 39, at end insert—
  ". In section 16 (power of local planning authority to make tree preservation order with immediate effect)—

  (a) in subsection (1), the words 'by the Minister" shall be omitted; and

  (b) for subsections (2) and (3) there shall be substituted the following subsections:—

  '(2) Notwithstanding section 29(4) of the Planning Act, an order which contains such a direction shall take effect provisionally on such date as may be specified therein and shall continue in force by virtue of this section until—

  (a) the expiration of a period of six months beginning with the date on which the order was made; or

  (b) the date on which the order is confirmed or, in the case of an order which can be confirmed only by the Minister, on which he notifies the authority who made the order that he does not propose to confirm it;

  whichever first occurs.
  (3) Provision shall be made by regulations under the Planning Act for securing—

  (a) that the notices to be given of the making of a tree preservation order containing a direction under this section shall include a statement of the effect of the direction; and

  (b) that where the Minister, in the case of an order which can be confirmed only by him, within the period of six months referred to in subsection (2) above, notifies the authority that he does not propose to confirm the order, copies of that notice shall be

  745
  served on the owners and occupiers of the land to which the order related.'").—(Baroness Serum.)

  On Question, Amendment agreed to. Schedule 6, as amended, agreed to.
  Schedule 7 [Transitional Provisions and Savings]:
  7.9 p.m.
  LORD MERRIVALE LORD MERRIVALE moved, in paragraph 1, to leave out "not without the approval of the Minister be submitted to him", and insert "be submitted to the Minister". The noble Lord said: I beg to move Amendment No. 112 which stands in my name. I think I am right in saying that when the new planning system first comes into operation only a very few local planning authorities will be empowered to operate it. Other local planning authorities will not be able to propose alterations to their development plans without the permission of the Minister. That is under paragraph 1 of Schedule 7. It is not at all clear at the moment what the Government intend these authorities who are not empowered to operate the new system should do in the interim period.
  I feel that the need to obtain the Minister's permission would seem to be a disincentive to do any further work on the development plan until they in turn are empowered to operate a new system, which might not happen for a number of years. I should have thought that this could mean a gap during which to some extent, planning could stagnate. The Amendment suggests that local planning authorities still operating under the old system shall submit to the Minister proposals for alterations and additions to their development plans. However, the main object behind this Amendment is to draw a statement from the noble Baroness, or from the noble Lord, Lord Kennet, as to the Government's intentions during this interim period. Accordingly, I beg to move.
  Amendment moved—
  Page 104, line 9, leave out from ("shall") to ("under") in line 10, and insert the said new words.—(Lord Merrivale.)
  LORD KENNET: I will give the noble Lord a statement forthwith. Where it is necessary during this transitional period that plans should be submitted and approved under the existing provisions of
  746
  the 1962 Act, the Minister will not withhold his consent to their submission. There will be cases, for example, where comprehensive re-development plans is have come to maturity and it is urgently desirable that they should be got of with. In such cases, authorities which are not planning under the new system will certainly be permitted to submit their comprehensive development area proposals as an amendment to the development plan under the 1962 provisions. I hope that this meets the noble Lord's point and will enable him to withdraw his Amendment.
  LORD MERRIVALE: It is my intention to withdraw my Amendment. I thank the noble Lord for his statement, brief as it is.
  Amendment, by leave, withdrawn.
  Schedule 7 agreed to.
  Schedule 8 [Enactments repealed]:
  LORD KENNET: This Amendment is consequential on No. 70. I beg to move.
  Amendment moved—
  Page 108, line 5, column 3, leave out from second ("and") to ("subsection") in line 10. —(Lord Kennet.)
  On Question, Amendment agreed to.
  LORD KENNET: This Amendment is consequential on the new clause carried into the Bill after Clause 69. I beg to move.
  Amendment moved—
  Page 108, line 12, column 3 at end insert—("In section 29(5), the words 'and, subject to' onwards").—(Lord Kennet.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: I beg to move Amendment No. 114A.
  Amendment moved—
  Page 109, line 22, column 3, at end insert—("Section 187").—(Baroness Scrota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: I beg to move Amendment No. 114B.
  Amendment moved—
  Page 109, line 27, column 3, at end ilsert—

  ("In section 200(2), the words 'the Crown Estate Commissioners or by'").

  —(Baroness Serota)

  On Question, Amendment agreed to.
  BARONESS SEROTA: Amendments Nos. 115 and 116 are the last of the Amendments that are consequential to the Amendments we made to Clause 16. I beg to move the first of these Amendments.
  Amendment moved—
  Page 109, leave out lines 51 to 53.—(Baroness Serota.)
  On Question, Amendment agreed to.
  BARONESS SEROTA: I beg to move No. 116.
  Amendment moved—
  Page 109, leave out lines 56 and 57.—(Baroness Scrota.)
  On Question, Amendment agreed to.
  LORD KENNET: This Amendment also is consequential on the new clause moved into the Bill after Clause 69. I beg to move.
  Amendment moved—
  Page 110, line 16, column 3 at end insert—("In section 16(1), the words 'by the Minister'").—(Lord Kennet.)
  LORD BROOKE OF CUMNOR: I have no desire to oppose this Amendment. It is the last on the Marshalled List, and I should like to seize the opportunity, at the end of some 15 hours of debate on the Committee stage of this complicated Bill, to thank the noble Lord, Lord Kennet, and the noble Baroness, for their unfailing courtesy, and to congratulate them on having carried the Bill through this Committee stage without hazarding a line of it in a Division. What will happen in later stages I cannot predict.
  LORD KENNET: Perhaps I may thank and congratulate the noble Lord on his unfailing courtesy, reasonableness and persuasiveness, which I have sometimes found a personal embarrassment, because there have been occasions when he has convinced me—or nearly—when he should not have done. May I also, improper as it is, thank my noble adjutant for her part in this Bill, and all noble Lords who have contributed to the elucidation, if not actually to the amendment, of this Bill.
  On Question, Amendment agreed to.
  Remaining Schedule agreed to.
  House resumed: Bill reported without amendment.

  THEATRES BILL
  7.17 p.m.
  LORD STOW HILL: My Lords, I beg to move that the House do again resolve itself into Committee on this Bill.
  Moved, That the House do again resolve itself into Committee.—(Lord Stow Hill.)
  On Question, Motion agreed to.
  House in Committee accordingly.
  [The LORD CHAMPION in the Chair.]
  Clause 14 [Powers of entry and inspection]:
  LORD MILVERTONmoved, in subsection (2), to leave out "in respect of which a licence under this Act is in force", and insert "whether licensed or not". The noble Lord said: With the permission of the Committee I rise to propose this Amendment on behalf of my noble friend Lord Ilford, who regrets his inability to remain this evening as he has an important engagement. With the permission of the Committee, I should like at the same time to speak upon Amendment No. 9, as they are so closely allied.
  These Amendments deal with the circumstances in which the officer of the licensing authority may enter premises to see whether the conditions of the Bill or of the licence are being complied with. In the case of licensed premises this officer may enter without a warrant, but in the case of unlicensed premises the Bill as at present drafted requires the officer first to obtain a warrant from a magistrate. The delay involved in seeking authority from a magistrate and obtaining a warrant may, in some circumstances, defeat the purpose of the inspection. The licensing authorities themselves desire that both classes of premises should be placed upon the same footing, and that their officer should be entitled to enter unlicensed premises without first obtaining a warrant. The time that would be lost in laying an information on oath and obtaining a warrant is a very important consideration, and inspection is more necessary in the case of unlicensed premises than in the case of licensed premises, while licensed premises are

  749
  more likely to comply with the requirements of safety than are unlicensed premises.
  If I may enlarge slightly on that, whatever may be the position in London, much valuable time will be wasted in many provincial towns while an authorised officer of the licensing authority is seeking out a justice of the peace for the purpose of laying an information on oath with a view to obtaining a warrant under subsection (1) to enter unlicensed premises where he has grounds for suspecting that an offence against the licensing provisions is being or will be committed. If one looks at it in the case of licensed premises, the authority is dealing with people who, at least have a knowledge of the law, and by reason of having applied for a licence have shown a willingness to comply with the requirements of the local authority. Surely that authority would not normally issue a licence unless the premises concerned were at least initially satisfactory. The position in regard to unlicensed premises, however, may be altogether different and their use at all for the presentation of stage plays may be wholly unsatisfactory. That is a very brief statement of the case for both these Amendments, but I hope that the noble Lord will consider it adequate for his favourable consideration.
  Amendment moved—
  Page 9, line 36, leave out from ("premises") to ("at") in line 37 and insert ("whether licensed or not").—(Lord Milverton.)
  THE MINISTER OF STATE, HOME OFFICE (LORD STONILAM): I am grateful to the noble Lord, Lord Milverton, for moving this Amendment in the place of his noble friend, but I hope he will agree that this is an Amendment which it is not desirable to make to the Bill. The noble Lord is of course aware that under the Bill inspectors will have authority to enter without warrant when the premises are licensed. By his Amendment, he wants the inspector to have power to enter without warrant any premises which are not licensed when they suspect that something is going wrong.
  With respect, it seems to me that the noble Lord based his whole case on the time which he alleged would be lost while they were looking around for a justice before whom they could lay an information on oath, and he thinks that this might
  750
  be fatal. Subsection (1) of the clause permits an officer to apply for a warrant and I would point out to the noble Lord that it is only when the premises are unlicensed, and it is only on the grounds of his suspicion, that an officer of the licensing authority would ever need to enter unlicensed premises.
  The Government consider that existing powers are sufficient for all reasonable purposes. As the noble Lord is probably aware, this subsection of Clause 14 is modelled on the parallel provisions of subsection (2) of paragraph 12 of the Schedule 12 to the London Government Act 1963, which has worked extremely well. I am also sure the noble Lord will agree with me that among associations of local authorities it is only the Association of Municipal Corporations which has persistently advocated that this power which is almost, but not quite, unprecedented should be given.
  Against the single argument of time that might be lost we must weigh the consideration that these are very wide powers which are asked for which will enable the local authority officer to enter any premises whatever, including private houses, if he has reason to suspect the public performance of a play is being held. These are not powers which your Lordships' Committee, 11 am sure, would lightly agree to give. Nor has it been the practice in licensing legislation generally that local authority officers should have such powers except in respect of premises that have been licensed and where the matter in question is the enforcement of statutory requirements in premises to which it has been recognised they should apply.
  So far as I am aware, the only precedent that exists for the powers for which the noble Lord asks in his Amendment are in the Cinematograph Act 1909. Those powers were granted in those days largely because the films made then were highly inflammable and likely to constitute a danger. Therefore it was thought then, nearly sixty years ago, that these powers of immediate inspection, as it were, without warrant were justified. I beg leave to doubt that if we were enacting similar legislation to-day, or it was proposed that we should enact it with the safer films that we have to-day, these powers would be granted. I

  751
  feel very strongly that we should not confer these unlimited powers on local authorities, and I hope the noble Lord will feel able to withdraw his Amendment. Failing that, I hope my noble friend will not accept it.
  BARONESS GAITSKELL: I should like very strongly to oppose this Amendment of Lord Milverton in one sentence only; that is, that it would make it absolutely impossible for any family to have a harmless game of charades in their sitting room if this Amendment were accepted by the Government, and I hope that we shall utterly reject it.
  LORD SOMERS: I wonder whether the noble Lord could give us some instance of where he thinks this would do some harm. With regard to what the noble Baroness has just said, surely in his interests the inspector will not go round from house to house entering wherever he will to see whether something is going wrong. He will do that only where he has definite ground for suspecting it, and I cannot see that there is any likelihood of a responsible man who is doing responsible work going round from house to house and entering without the slightest reason.
  LORD STOW HILL: I hesitate to add to what has been said so convincingly by my two noble friends who have spoken from this side of the House, and I only venture to rise because my noble friend Lord Stonham appealed to me to advise the Committee not to accept the Amendment. I readily accept that advice. With great respect to both noble Lords, the Bill at the moment, I should have thought, is framed exactly right. Where there are premises in respect of which there is a doubt as to whether there is any licence at all, and where it may be thought that there is a play in unlicensed premises being produced, the Bill requires, in accordance with many precedents in our legislation, that there should be an information before a justice of the peace. That is provided for by Clause 14, subsection (1).
  Clause 14, subsection (2), applies to the case where there is a licence but where it may be the case that that licence is being infringed; that the terms of it have not been complied with. I should have thought that, apart from the
  752
  fact that it is the almost universal practice in our legislation which is being followed (with the sole exception, I think I am right in saying, of the Cinematograph Act to which my noble friend Lord Stonham referred), it is surely the right balance.
  The powers given to an officer of a local authority in relation to the Amendment are extremely wide-ranging. If the Amendment were carried, an officer of the local authority could enter private premises or, as my noble friend Lady Gaitskell pointed out, a private house, and would also be empowered to inquire whether there was a breach of Clauses 2, 5 and 6. Under the terms of the Amendment, an officer of a local authority is to be allowed to enter any premises for the purpose of seeing whether the terms, conditions or restrictions of the licence are being complied with, and is also to be empowered to enter any premises, including a private house, for the purpose of inquiring whether "the provisions of this Act" that means all the provisions of the Act —are being observed. This would include Clause 2, which deals with obscenity; Clause 5, which deals with race incitement; and Clause 6, which deals with incitement to breach of the peace. It would be intolerable for somebody who has not had the training of a police officer to be allowed to enter any premises at all without the authority of a justice of the peace, just because he takes it into his head to suppose that an obscene play may be being performed even in a private house. That is the effect of the Amendment, and I cannot help wondering if noble Lords who have supported this Amendment have considered its full implications. They are most far-reaching and are unacceptable to our thinking in general in respect of entry into premises.
  Noble Lords have justified the Amendment by urging that there would be delay. That is tantamount to saying that in every case where it is required that premises should not be entered except with the authorisation of a justice of the peace, those provisions should be cancelled because they involve delay and the person whom it is sought to apprehend may have mended his ways before the office: gets authority to enter the premises. That is very wide-reaching.

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  Our Legislature has decreed time and again that before premises are entered in order to be searched to see whether serious crime has been committed, there must be an authorisation by a justice of the peace. That is what is being done in this case. If it is wrong in this case, it is wrong in all the other cases in which, in a far more serious context, it is being used. I hope therefore that when the implications of the Amendment are considered, it will not be pressed. The delay is not so great. Experience has shown that a warrant can be obtained very quickly. It is not as if a person who seeks entry has to search through a telephone book or search half London before he can find a justice of the peace. It is known where a justice of the peace can be found, and it does not take long to put an information before him and for action to be taken in an appropriate case. Experience has shown that it is a short procedure. This has worked well in many other cases, and I can see no reason why it should not work equally well in this case. I hope that the committee will reject the Amendment.
  EARL BATHURST: Could the noble Lord, Lord Stow Hill, or perhaps the noble Lord, Lord Stonham, tell me for how many days a warrant would be available once it has been obtained?
  LORD STONHAM: I should have thought that a warrant would be available for the normal period. I do not know whether there would be a special restriction on this type of warrant.
  EARL BATHURST: For how many evening performances would it be available: would it be a week, a fortnight, or for only one performance?
  LORD STONHAM: We are not thinking of performances. We are thinking of a warrant on a sworn statement granted by a magistrate for entry into premises. It is not a question of performance, but a matter of a period of time. It will be for a magistrate to say for how long the warrant endures.
  LORD MILVERTON: I am sorry that this Amendment has met with such a lack of enthusiasm. The idea at the back of it was no: the matter of obscene performances or family charades, but the safety of the buildings concerned. It is easy to assume that officers of licensing authorities will behave with a lack of
  754
  balance or sense, but that is certainly not my experience of them. To speak of interfering with family charades is really throwing a ridiculous light on a serious suggestion. Let us take an amateur performance which sometimes takes place in a schoolroom after school. In such instances there is a danger in relation to the structure of the building, the danger of fire, the danger of inflammable dresses being used, and the changer of an electrical fault. These are serious things which must be attended to. One of the main responsibilities of a licensing authority is that of safety. The legislation was not originally framed to look after morals, nor was it framed to interfere with innocent family games. It was framed to look after situations which might be a matter of life and death to people in the buildings. I regret that this suggestion has not been welcomed. I beg leave to withdraw the Amendment.
  Amendment, by leave, withdrawn.
  Clause 14 agreed to.
  Clause 15 [Offences by bodies corporate]:
  On Question, Whether Clause 15 shall stand part of the Bill?
  LORD SEGAL: Could my noble friend clarify the position of a director of a university theatre? This might be in a somewhat different category from an ordinary licensed playhouse, since plays of a purely experimental nature often are produced in such a theatre. They are often plays of considerable artistic merit, but they are invariably produce, 'by undergraduates who have had little experience of play production. Some degree of irresponsibility may be allowed to creep in, not only in the text, but in the acting of a play. In such a situation could my noble friend say whether the director of such a theatre would be liable to be proceeded against and punished in the same way as the director of a fully licensed theatre?
  LORD STOW HILL: First, one has to find that there is a body corporate and that it is the body corporate, a limited company or any other incorporated entity recognised by law as such, which through its officers has presented or directed or put on a play in premises licensed or unlicensed in respect of which a licence is requisite.

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  Once there is that situation, whether it is at the university or whether it is in any other context, one then has to ask, looking at the particular person—whether he is, say, a don at a university, a director of a company, or any other person who has responsibility in the company as a director, manager, secretary or other similar officer of the company or body corporate, whatever it may be—can it be predicated of him, and established affirmatively in evidence against him, that it was with his consent that the offending performance was put on? I should have thought it was not sufficient—though it is not for me to lay down what the Bill means; I simply offer an opinion which subsequently may be confirmed or rejected by the courts—to say that he was in the vicinity. He has in some way to be shown to have been a positively consenting party. He must know that the play is put on. I should have thought he must know that there must be some factual situation present which constitutes the commission of an offence, and he must in a general sense be said to be involved in it.
  Many people may be connected, as patrons or otherwise, with a legal entity which is used for the purpose of putting on plays. But I should have thought it could not be said of them in any ordinary probable context of fact that they consented in the sense in which Clause 15 uses that word. Their minds, I should have thought, must be shown to have gone to and with the performance, and to have been cognisant of the features and characteristics of the performance, or of the other circumstances which give rise to the commission of an offence.
  While I perfectly understand that there is apprehension on the part of some parties as to whether they could be unwittingly involved, the interpretation which I offer to the Committee is one which could not possibly lead to a person who is, in a general sense, wholly innocent and unwitting of what is going on being involved in criminal proceedings. The words "with the consent" have to be read together with the words "or connivance". There has to be some actual participation—I do not say in an active sense, but in the sense that there must
  756
  be knowledge of what is going on and an acquiescence in it, in circumstances where it was perfectly open to the individual concerned, having that knowledge, to refuse to be associated with it or to use his influence to prevent it. Nothing less, I should have thought, could possibly suffice for the involvement in criminal liability of any of the persons here listed—directors, managers, secretaries or other similar officers of a body corporate. I should have thought that that was just as true of a university body as it was of an ordinary limited company. I hope that answer will be thought adequate by my noble friend.
  LORD SEGAL: I should like to thank my noble friend for clarifying this point to a large extent. I do not wish to press the matter at this stage, but I think he fully realises that a great deal more latitude ought often to be allowed to young undergraduates and minors, who are often quite inexperienced in the production of plays. The purpose of a university theatre is to educate the students not only in play writing but in play production, and in acting itself. Therefore, in those cases I hope that this clause will be interpreted with a great deal more latitude than would ordinarily be allowable in the case of a licensed theatre.
  LORD STONHAM: While entirely agreeing with what my noble friend Lord Stow Hill said in answer to my noble friend, may I ask this question, in order that there should be no misunderstanding arising out of what my noble friend Lord Segal has just said? Is it not the case that under this Bill the position of the presenter of a play in a university would be precisely similar to the presenter of a play by an amateur dramatic society somewhere else?
  Clause 15 agreed to.
  Clause 16 agreed to.
  7.45 p.m.
  LORD FARINGDON LORD FARINGDON moved, after Clause 16, to insert the following new clause:
  Copy of each new play to be delivered to British Museum
  ".—(1) This section applies to the first performance of every new play, based on a script, and "new play" includes every new act, scene or other part added to any old play, and every new prologue or epilogue, and

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  every new part added to an old prologue or epilogue:
  Provided that this section shall not apply to a performance of a play falling within the exceptions contained in section 7 of this Act.
  (2) The person or persons who presented a performance to which this section applies shall within one month of the date of that performance deliver at his or their own expense a copy of the actual script on which that performance was based to the Trustees of the British Museum who shall give a written receipt for it.
  (3) If the person or persons who presented the performance fail to comply with this section, he or they shall be liable on summary conviction to a fine not exceeding £20, and the fine shall be paid to the said Trustees.
  (4) In this section "script" has the same meaning as in section 9(2) of this Act."
  The noble Lord said: This is an Amendment for which I have received a great many expressions of sympathy from noble Lords in all parts of the House, and that seems natural in view of the circumstances which give rise to it. The Amendment arises because of the terms of the first Act setting up censorship, which was passed by Walpole in 1737 and contains the provision that, when distributing licences, the Lord Chamberlain should demand the deposit with him of the scripts of all new plays. The result—a quite unexpected result, I suspect—has been the formulation of a fantastic library of theatrical documents —not all, I regret to say, in England. I also regret to say that, on an earlier occasion, I quite unintentionally misled your Lordships, because I said that the documents which are not in England are in the Library of the University of Harvard. I am informed that they are not, and that they are, in fact, in the Huntington Library, at San Merino, in California.
  Since 1824 this accumulation of documents has been in the care of the Lord Chamberlain, and I believe it is only recently that they have been, for the most part, transferred to the British Museum. Here I may say that the British Museum is most anxious to have the rest of the documents, and to be made the beneficiaries of an arrangement which would ensure the continuing collection of theatrical documents in the future. I am told that there are difficulties about this, but I have had discussions with my noble friend Lord Stow Hill and I hope that we shall be able to find some method by which it will be possible to make a reasonable and workable provision for
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  the accumulation in the future, as in the past, of these immensely interesting theatrical and human documents.
  I am hopeful about this, because, although it is fairly easy to anticipate difficulty about this collection, in fact very little difficulty has been experienced. This is also true of the Copyright Act which has somewhat similar terms, and which has been found in practice to work very simply and easily. I hope that my noble friend and I will be able before the Report stage to evolve a satisfactory method of preserving this unique library, and ensuring its future for all time. I beg to move.
  Amendment moved—
  After Clause 16, insert the said new clause. —(Lord Faringdon.)
  LORD STRABOLGI: I should like to support most strongly what my noble friend Lord Faringdon has said. As he has made clear, the Lord Chamberlain's Office amassed the most valuable, interesting and historic are hive of all the plays performed during the period when the Lord Chamberlain was responsible for censorship, and I am most concerned that this should be continued and that scripts of plays should be lodged in the British Museum. If a play is published by a publisher, the printed work will, under the Copyright Act, go to the Museum, but this will not be so if the play is not published, in the sense that we have known it.
  I was interested to note that my noble friend did not include the other copyright libraries—I am sure he left them out for a good reason. I welcome the information he has given the House, that he and my noble and learned friend Lord Stow Hill will be going into this matter more closely before the Report stage, and I hope that some acceptable Amendment will be evolved by then so that this very important question can be included in the Bill.
  LORD STOW HILL: I think the Committee would be very sympathetic with the motive which prompted my noble friend to put this Amendment down on the Order Paper. We all desire that any play of any merit, even of doubtful merit, should be preserved for posterity instead of perhaps being wholly lost if it is not deposited in some place of safety such as the British Museum.

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  If I thought that this Amendment formulated a practical scheme for the purpose, I would certainly support it. I had the great advantage of having conversations with my noble friend Lord Faring-don, and I pointed out to him the anxieties I felt over the wording he had chosen and his reasons. Perhaps I might shortly state them to the Committee. The clause as drafted applies in effect to all plays. It is true that in the case of public performance of plays there was a similar provision applicable in the case of the Lord Chamberlain. Scripts were deposited with him and, as my noble friend said, a very valuable collection or library was accumulated over the decades, indeed centuries, during which this was done. The difficulty is that my noble friend's Amendment would apply not only to what I might call a recognised West End or provincial theatre, or something of that sort, but in its present wording it will apply to every play, for example, that is performed in a school hall, in a village, or in any local building in which there is an amateur theatrical performance put on.
  Hitherto, it has not been the practice for scripts used for these sorts of purposes to be sent to the Lord Chamberlain. It may be that under the law of 1843 this practice should have been carried out. When I say that, I have in mind the prosecution before a learned magistrate concerning the Royal Court Theatre, in which there was a theatre club; and it was held that a performance by a theatre club fell within the scope of the Theatres Act 1843. If that decision was right—and it was never tested in the higher courts—it would follow that scripts of the sort I have described, in country village performances and so on, should have been deposited with the Lord Chamberlain. In fact, this was never done over the decades during which the Act was operative.
  This Amendment, under its wording, would certainly require that to be done. It would be almost impossible to enforce. I know noble Lords will agree with me when I say that we must not put upon the Statute Book a criminal injunction unless it is reasonably possible to enforce it. One of the worst things that can be done is to enact that something should be a crime, when one knows per
  760
  fectly well that it is almost impossible to see that the law is observed. That brings the law into disrepute and disrespect, and it must be avoided by the Legislature, as I hope noble Lords will agree. That is just what is being done here. How on earth is there to be an organisation to ensure that the script of a school hall performance, somewhere in the country, will be sent to the British Museum? Not only is there that difficulty, but subsection (1) of the Amendment provides that the script is to include any new act, every other part added to any old play, every new epilogue or prologue, every new part added to an old prologue or epilogue.
  I know these words came from the Theatres Act 1843, but would not this sort of thing arise in a local hall? A script is used and if the performance goes on for two or three nights it is perhaps changed over and over again—an actor cannot remember his part or the part does not seem to suit him, and so it is altered. The effect of this subsection would be that every single alteration, every amended script, every change in the script, would have to be sent to the British Museum, under pain of a fine or other penalty as prescribed by the Bill. Clearly, that could not be enforced, and clearly if we enacted a law in those terms we would be enacting a law which would have not the slightest effect. I would very strongly counsel the Committee not to give their assent to the enactment of laws in those terms.
  Those are the sort of difficulties I have explained to my noble friend, which caused me to feel that I could not assent to his proposal. But as I said to him, and as I say again to the Committee, I am very sympathetic with the desire to preserve plays of the least merit and I should be very willing to consider, between now and Report stage, any proposal which might be viable.
  My noble friend handed to me just before I came into the Chamber the draft of a new Amendment he was contemplating, which was considerably changed from that which the Committee is now considering. I would say to him that I should like to study it very carefully between now and the Report stage. I would not like to commit myself to saying it is a feasible scheme which is embodied in the draft. I should like to think about it,

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  but I hope that as we are now considering the Amendment before the Committee, the Committee will feel that the advice I am giving is well-founded and that they ought not to give their assent to this scheme.
  LORD GOODMAN: In view of what has been said, it would be quite wrong to burden your Lordships for any length of time on this matter, except to say that one earnestly hopes that some clause will be evolved before the Report stage that will serve to preserve this most important fund of documents, which is important from a social and historical point of view and from the point of view of the drama. I wonder whether one might throw out a suggestion: one way of dealing with the matter might be to give the British Museum the right to call for copies; instead of making it mandatory for copies to be sent to the British Museum, to require persons who are performing a play in public to notify the British Museum by a postcard that such a performance is taking place, so that the British Museum might be given the right, if they want it, to call for a copy of a play in certain circumstances. I make that as one possible suggestion, because the Committee would feel that even if the net does not catch every work, as it seems clear it could not, it would be very unfortunate indeed if, because of drafting difficulties, we totally excluded the possibility of having a large proportion of the plays presented.
  7.58 p.m.
  LORD STONHAM: I am sure that everyone wants to be helpful about this, and everyone is sympathetic to the objective which my noble friend Lord Faring-don has in mind. I think that during the Second Reading the noble Lord, Lord Annan, said that all that had to be done would be to readdress the envelope that would have been sent to the Lord Chamberlain. If we could do that in a Bill, it would be all quite simple. But when we start to put these things into a Statute, it is not so easy.
  I support my noble friend Lord Stow Hill in what he has said about the difficulties inherent in this Amendment. I think it is accepted by all noble Lords who have spoken that Lord Faringdon's Amendment is impossibly wide and quite unacceptable on those grounds, and in
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  any event would not achieve what he wants. I am bound to say, however, that the Government are very doubtful whether the collection of this material justifies a statutory provision; End if there is to be such provision then the obligations imposed must not be greater in character or extent than are necessary to fulfil the objectives.
  As my noble friend Lord Stow Hill put it, it is almost impossible to enforce, and we must not put on the Statute Book a criminal injunction unless it is possible to enforce it. There is no point in dilating on the difference between the position of books, which is comparatively simple, as compared with plays but these things must be taken into account, as must also the question of which script is to be presented. It is possible that a script might be very different at the end of a month—certainly at the end of 500 performances—from what it was at the beginning. There is also the difficulty in relation to minors, although this might be got over.
  My noble friend Lord Stow Hill said he would be pleased to look at any suggestions put forward which would have the desired effect—without, I hope, criminal sanctions—and certainly we should be prepared to help in that way if we possibly could. But out of a desire to be helpful I would mention one or two basic criteria which would have to be satisfied if an Amendment under this Bill were to be accepted. Any obligation which this Bill imposes in this field must make it clear just what has to be presented. There must not be any uncertainty in the mind of the person responsible for complying with this obligation. Then, the obligation must not impose unreasonable burdens on the whole world of the theatre. The third requirement, of course, is that the scheme must be enforceable. I very much doubt whether a solution satisfying all those three requirements will be found, and I believe that it would be much better to consider what can be done in a voluntary way to achieve what we have in mind.
  I understand that the Society for Theatre Research would be willing to operate a voluntary system, and to be responsible for collecting worthwhile

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  material and sending it to the British Museum. This is a very hopeful offer, particularly as my noble friend assured us that the British Museum is most anxious to have it. My noble friend referred to "the preservation of this unique library of interesting human documents." I think I must say that hereafter, when there is no censorship, the documents are likely to be far less interesting than they have been in the past, because I understand that the main interest arose from the correspondence which ensued between the authors and presenters of plays and the Lord Chamberlain. Certainly I think there are some outstanding examples from George Bernard Shaw and others of his time.
  But it seems to me that if an acceptable statutory requirement cannot be found then the best way to proceed would be to substitute some voluntary arrangement. It might be appropriate, therefore, for me to mention that we are considering the issue to associations connected with the theatre of an explanatory pamphlet setting out the main changes in the law brought about by the Bill when it becomes an Act. I say "connected with the theatre", but of course it would be a Stationery Office pamphlet and would be available to everyone. We should be prepared to mention in this pamphlet the desirability of sending scripts of plays to the British Museum; and, of course, if by that time any voluntary machinery had been set up to help people, it could set out what that was. This might eventually be the best solution. But certainly I hope the pamphlet I have mentioned will be a great help in making the basic facts of the change in the law brought about by this Bill known to as wide a circle as possible.
  LORD GOODMAN: May I ask the noble Lord, before he sits down, whether, if this does come about (as indeed may have to be the case, so long as this system is the best), the Government will consider incorporating in the Bill some very modest provision for providing funds for a voluntary organisation to do this? I think the major problem will be the wherewithal to carry this into effect.
  LORD STONHAM: This is a very difficult subject, and not my province, but I will note what the noble Lord has said.
  LORD SEGAL: I do not wish to delay the Committee, but this suggestion by my noble friend Lord Stonham that an explanatory pamphlet should be made available through the Stationery Office is of such interest and of such value that I am wondering whether there could be included in it the section of the Copyright Act which requires that copies of books should be deposited not only with the British Museum but also with the Bodleian Library and the Cambridge University Library—a point which my noble friend Lord Strabolgi raised in his remarks, though it was not fully answered, I think, by my noble friend Lord Stow Hill in his reply. The reason I suggest that it should be included in this explanatory pamphlet is that I believe far more interest in these plays will be taken in these other libraries than possibly even in the British Museum.
  LORD FARINGDON: My Amendment does not seem to have had a very successful reception. I was, if I may say so, very disappointed in what my noble friend Lord Stonham said because, frankly (I may have a very poor opinion of human nature), I know how lazy I am myself and I do not believe that this library will continue to be formed if it has to depend upon voluntary effort or upon any scheme which has no sanctions behind it. In that connection, I would again come back to the copyright arrangements of which my noble friend Lord Strabolgi spoke. The interesting thing to us in the present circumstances, discussing the present subject, is the way in which books are supplied to copyright libraries. I think I am right in saying that it is only the British Museum which gets the books automatically: the other statutory libraries are, I think, entitled to ask for them; but when they ask they must receive.
  I believe that if we are to continue to keep this theatrical record in the future as in the past some form of compulsion will be necessary. It may well be—indeed, I should expect—that in fact compulsion would be no more painful than has been the compulsion in connection with copyright. I am told by friends of mine in the book trade that they have in fact occasionally omitted to send in their books. When that has happened, they have got a polite little note from the British Museum saying,

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  "We think this must have escaped your notice, as you will realise that under such-and-such a section of the Copyright Act you should have sent us a copy of your recent publications, 'so-and-so' and 'so-and-so'". On those amicable terms the copyright system has worked without ever, I believe, the enforcement of the sanctions which are available.
  But I will not detain your Lordships. I thank those who have supported me; and I hope that: the noble Lords, Lord Stonham and Lord Stow Hill, will be more amenable when I produce another Amendment on Report stage. Incidentally, I have one in my pocket which I think covers most of Lord Stonham's points. I beg leave to withdraw the Amendment.
  Amendment, by leave, withdrawn.
  Clause 17 [Interpretation]:
  8.10 p.m.
  LORD LLOYD OF HAMPSTEAD LORD LLOYD OF HAMPSTEAD moved, in subsection (2)(b). to leave out "and" and to insert instead:
  "Provided that if the director or his representative shall raise no objection to a variation of performance carried out for not less than three performances, the director shall be regarded as having approved and accepted responsibility for such variation and the performer shall not thereafter be regarded as the director of the performance and provided further that the directional responsibility of the performer shall be limited to the variation of performance for which he is alleged to be responsible;".
  The noble Lord said: I beg to move Amendment No. 11, which stands in the name of my noble friend Lord Willis, who unfortunately is prevented from attending your Lordships' Committee. Clause 17(2) of the Bill starts with the laudable intention of ensuring that an actor, merely because he is taking part in a performance, is not to be held responsible for that performance and therefore not to be made liable for an offence under the Bill when it becomes an Act. But it goes on, in paragraph (b) to make what seems the rather remarkable proposal that if the actor does something which is not in accordance with the directions that he should receive from the person directing or presenting the play, if he should "ad lib." a line, or something like that, he is to be responsible not just for this line which he has "ad libbed." but for the whole
  766
  performance. This, I venture to submit, is quite an extraordinary proposal. One can understand that the actor should be liable for that which he has inserted. But why this should make him automatically the offender in relation to the whole performance I find difficult to follow.
  The form of the Amendment seeks to mitigate the effect in two ways. First, it says that if the director has adopted or ratified this variation for three performances then he assumes responsibility, so to speak, takes over and the actor drops out. Secondly, it adds the proviso that in any event the responsibility of the actor should be limited to the particular variation that he has introduced. I should have thought that there might be a case for saying that this whole provision of Clause 17(2)(b) is really rather absurd and could quite well be chopped out of the Bill. But the Amendment does not go as far as that. It seeks simply to modify it in the way I have indicated. I beg to move.
  Amendment moved—
  Page 11, line 39, leave out ("and") and insert the said proviso.—(Lord Lloyd of Hampstead.)
  LORD STOW HILL: I would advise the Committee not to accept the Amendment, for the following reasons. We are no doubt all united in the des re to produce a result that is fair to the actor, on one side, and fair to the person whom I may generically call the producer, on the other. In those circumstances this is how the situation might work out. One begins with this. A play is obscene only if, taken as a whole—and I emphasise "taken as a whole"—it tends to corrupt and deprave. It is not the single line, as my noble friends say, but the general effect of the play as a whole that brings it within, or leaves it outside, the scope of Clause 2.
  Take the case of an actor who "ad libs". If he introduces merely one or two lines I do not suppose that that would have the effect of causing the play to cross the Rubicon into the scope of Clause 2. But a play is not far from the boundary, and supposing that the producer has strictly forbidden the actors to depart from the text because there might he the risk of any additional borderline matter bringing the play within the scope of Clause 2 as a whole; and

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  supposing that he has tried all he can to stop the actors from doing it and they nevertheless do it, it seems unfair to him that, because he has not actually watched like a lynx every performance and spotted where it had transgressed his instructions, he may be held to be liable in terms of this Amendment.
  I think that is all the more the case when one looks at Clause 17(2)(c), which provides that:
  "a person shall be taken to have directed a performance of a play …notwithstanding that he was not present during the performance;"
  I suppose that you might have over and over again a producer who does his best to see that the play is not objectionable from the point of view of Clause 2. He then perhaps goes abroad, or is absent from the performance because he was perhaps presenting elsewhere some quite different play which he has also produced. If, behind his back, the actors depart from his instructions and use language or gestures which have the result of causing the play to cross over the limit, the result under the terms of this Amendment is that he is made responsible. It seems to me that that is very unfair. It is not right in the circumstances that a producer who has done all he can to keep within the prescribed limits, because something of which he was wholly ignorant was done behind his back and was not picked up by those who were there to watch on his behalf; because in those circumstances there has been "ad libbing" which has brought the play within the scope of Clause 2, should be held to have criminal liability.
  It seems to me very unfair that that should be the case. But that would be the result, I put it to the Committee, of the Amendment as drafted. From the point of view of the actor, one could ask: "Is he adequately protected under the terms of paragraph (b)? I should have thought that he was. The words there are:
  "…if without reasonable excuse he performs otherwise than in accordance with that person's direction …"
  Supposing that he does "ad lib."; that he does not follow strictly the text; that he indulges in gestures or something like that; if he was in a general sense not culpable he can rely upon the words that
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  give him a "get-out" if he can show that he had reasonable excuse for so doing.
  But if we put in the proviso it might be that those words of wide ambit in the clause as drafted might be held to have a rather narrower scope if read side by side with the proviso. I should have thought, therefore, that if one looks at the matter from the point of view of the actor he is better protected with the clause as it is at present than if the proviso is inserted. In its present form, I should have thought that he had ample protection. If he "ad libs." with a reasonable excuse there is nothing to fear. It is only if he does so without reasonable excuse that he may find himself joined in criminal responsibility.
  Therefore I put it to the Committee that as the clause is at present drafted it does give protection. If it is changed in the way that my noble friend wishes to change it, then in the first place the protection given to the actor may be rather less than at present, and, in the second place, it would undoubtedly, in my submission, produce extremely unfair results from the point of view of the producer. Therefore I hope that the Committee will come to a conclusion, weighing the arguments on both sides, that the clause is very much better as it stands and that the Amendment would produce unfair results, both for the actor and for the producer.
  LORD GOODMAN: This is a small point, but I venture to express the view that it illustrates the sort of Parliamentary drafting that gets us into trouble. It is an illustration of what I would call "completomania" in drafting. The original clause should not have been in at all. The original clause produces a weird effect; if we add the Amendment, we get a weird effect squared. I suggest to the noble Lord, Lord Stow Hill, that he should reconsider, before the Report stage, whether he has done justice to the point made by the noble Lord, Lord Lloyd of Hampstead, who, I think has a valid point. If the noble Lord will not think it an impertinence, I would venture to explain it as I see it.
  What the paragraph says is that if an actor without reasonable excuse has forgotten his lines and "ad libs." a single line he then becomes responsible for the

  769
  whole performance as I understand it. The normal reason for an actor "ad libbing." is that: he has forgotten his lines; and that, I gather, will not be regarded as a reasonable excuse, for a conscientious actor would know his lines. In any event I think it arguable whether it is a reasonable excuse, though it may well not be. It is not a question of considering the performance as a whole. It is not necessary for that line to have the little additional weight which converts the play into an obscene play. It may have been an obscene play without that line at all. It is the addition of that line which, under this drafting, makes him responsible for the play as a whole. That produces a total absurdity. I do not think that the situation would be improved by adopting the Amendment, which suggests that the actor, having become responsible for the play because he has "ad libbed." a line—for example because he has forgotten his lines—should cease to be responsible if the director, shall we say, is absent from the theatre for three nights and does not see what he has done; and the actor goes on repeating it for three nights. Then the matter is perpetuated and the director again becomes responsible. There is not an element of sanity in either proposition. I therefore venture to suggest, quite seriously, that the whole matter be reconsidered; and I think that a simple solution would be to leave out the subsection entirely.
  8.21 p.m.
  LORD STOW HILL: If I may venture to reply to the interesting and cogent speech to which we have just listened, I would think that if an actor departs from the text because he cannot remember what the text is, he might be said to have a rather good and reasonable excuse for the departure. If one pictures the actual situation, the question being whether the play is obscene as a whole and not a particular part of it, it would be an odd situation if the actor forgets his text for the lime being and then plunges into a volt. me of obscenity such as, by itself, by its individual lone force, divorced from al the rest, has the effect of pushing the play across the margin as a whole from non-obscenity into obscenity. Everything is possible in this most remarkable world, but I find it not altogether easy to conceive of a play which is not obscene, but then
  770
  an actor forgets his words and, because he does so, possibly in a moment of irritation plunges into a volume of obscenity of such intensity and volume that the play as whole becomes obscene. It may happen—
  LORD GOODMAN: If I may interrupt the noble Lord, from that point it is not necessary. The actor forgets his lines, and he has to "ad lib." He does not have to plunge into a torrent of obscenity. He can utter words of the greatest propriety, and if the play is otherwise obscene, under this clause he is then liable for it. This is the point. My understanding of this is that he becomes Liable whatever he says, provided the "ad fibbing.", the change, is a departure from the author's instruction, and one which is made without reasonable excuse. It does not have to be one which involves any obscenities at all.
  LORD STOW HILL: I do not think that the Committee would wish me to prolong the controversy, but the joint made is interesting. You start off, therefore, with a play which is obscene, produced in circumstances which are such that the law is already being transgressed and the producer is liable to be prosecuted because he is putting on an obscene play. The actor taking part in that obscene play unhappily forgets his lines, and so he introduces, instead of the obscene lines he was to have used, lines which are no longer obscene, and is anxious lest he should be prosecuted. I should have thought that if an actor, charged to voice obscenity, in a moment of forgetfulness changes himself to non-obscenity, the departure from the text could be excused as being owing to reasonable excuse.
  LORD LLOYD OF HAMPSTEAD: I do not propose to press this Amendment which I am conscious is not altogether in the most apt and satisfactory form. I respectfully agree with what the noble Lord, Lord Goodman, said, that it would be better (as indeed I suggested myself) if the whole subsection were omitted. I am sorry that my noble friend Lord Stow Hill is feeling so terribly unsympathetic towards this proposal, because it seems to me that here there is a serious point. One could easily find a situation where an actor might find himself saddled with the responsibility

  771
  for a whole play simply because, without reasonable excuse, he has injected some line which may be in itself obscene, or improper, or whatever it may be; and this is, I should have thought, a thoroughly irrational result. I urge my noble and learned friend to give this matter consideration, which I am sure he will be ready to do—at least I hope he will—between now and the next stage, in order to see whether this position might not be ameliorated either by omitting paragraph (b) or by making some modification to it. I beg leave to withdraw the Amendment.
  Amendment, by leave, withdrawn.
  Clause 17 agreed to.
  Clause 18 [Consequential amendments, repeals and transitional provisions]:
  LORD STONHAMmoved, in subsection (6), to leave out "three" and insert "two". The noble Lord said: I beg to move Amendment No. 12 and I should like to take with it Amendment No. 13, which is a similar Amendment. The effect of these Amendments is to bring forward by one month the date of the commencement in Clause 19 of the main provisions of the Bill, that is, all the provisions except those listed in Clause 14(2) which, of course, would come into operation immediately. If the Amendment is accepted the other provisions of the Bill will come into operation two months instead of three months after the Royal Assent and they make consequential provisions to the transitional provisions in Clause 18 which are, in part, linked to the commencing date.
  The Government are proposing this reduction in the period between the passing of the Act and its coming into effect on the suggestion of, and in the interests of, the Lord Chamberlain. He has pointed out that whereas in this case the law is being relaxed, there must be an element of artificiality in its continued enforcement after the Royal Assent, and he would welcome any reduction in the period during which he would be in this somewhat invidious position. Of course, the Government have considerable sympathy with this view. On the other hand, some interval between the passing of the Act and its coming into operation is essential where new criminal offences are
  772
  created, because time must be allowed for those concerned to acquaint themselves with the effect and implications of the new law before it begins to apply. For that reason we could not agree that the Act could, or should, be brought into effect immediately. But the Government consider that some reduction in the interval before the Act comes into operation could properly be made, and the two-month period of grace for which the Amendment provides is a fair compromise which would materially ease the pressure to which the Lord Chamberlain is likely to be subjected after the passing of the Act without unreasonably curtailing the time which those who have to operate the new Act will need for preparation for the assumption of their new obligations.
  When these Amendments were originally tabled in my name the noble Lord, Lord Cobbold, the Lord Chamberlain, had hoped to be present. As your Lordships are aware, the Committee stage could not be completed when the Committee first met and tonight, because of other engagements, he is unable to be present. But he has written to me authorising me to say that he welcomes the fact that if this Amendment is accepted, these parts of the Bill will come into operation two months after it receives the Royal Assent and I confirm on his authority, that in that period of two months he will continue to discharge his present responsibilities until the new Act becomes operative. That is entirely in accordance with the Government's wishes in this matter. I beg to move.
  Amendment moved—
  Page 12, line 14, leave out ("three") and insert ("two").—(Lord Stonham.)
  On Question, Amendment agreed to.
  Clause 18, as amended, agreed to.
  Clause 19 [Short title, commencement, extent and application to Isles of Scilly]:
  LORD STONHAM: I beg to move this Amendment.
  Amendment moved—
  Page 13, line 5, leave out ("three") and insert ("two").—(Lord Stonham.)
  On Question, Amendment agreed to.
  Clause 19, as amended, agreed to
  Schedule 1 [Provisions with respect to licences]:
  LORD STOW HILL: This is purely a drafting Amendment, designed to bring the wording of sub-paragraph (2) into line with the slightly different position in sub-paragraph (1). This produces no effect except to tidy up a slight lapse of language. I beg to move.
  Amendment moved—
  Page 14, line 32, after ("authority") insert ("not less than").— (Lord Stow Hill.)
  On Question, Amendment agreed to.
  Schedule 1, as amended, agreed to.
  Schedule 2 [Consequential Amendments]:
  LORD STOW HILL: This Amendment is again, broadly speaking, drafting. It substitutes a reference to this Bill for the reference to the Theatres Act 1843 in Section 11 of the Theatrical Employers Registration Act 1925. Section 11 exempts persons to whom a theatre licence has been issued from the need to register with the local authority and this change simply preserves the status quo by substituting reference to the present Bill for the reference to the Act of 1943. I beg to move.
  Amendment moved—
  Page 17, line 5, at end insert—

  ("The Theatrical Employers Registration Act 1925 (15 & 16 Geo. 5. c. 51).

  In section 11, for the words section seven of the Theatres Act 1843' there shall be substituted the words the Theatres Act 1968'.")

  —(Lord Stow Hill.)

  On Question, Amendment agreed to.
  LORD STOW HILL: Will your Lordships allow me to deploy the reasons in support of the remaining Amendments together, because they all hinge on the same point. Amendment No. 16 and the Amendment to Schedule 3 are consequential on Amendment No. 17, which seeks to insert certain new words which appear on the Marshalled List. The reason for this insertion is to be found in the Finance Act 1957 under which, subject to qualifications, justices' licences for retail sale of intoxicating liquor were abolished. That necessitated a change in Section 199(c) of the Licensing Act 1964, because that Act was written so as to
  774
  apply to the then existing legislation. The new subsection which I seek to write in by this Amendment refers to the present Bill. This group of Amendments makes no change in principle but simply preserves the existing situation by substituting a reference to this Bill for references to previous legislation which covers the same ground. I beg to move.
  Amendment moved—
  Page 17, column 2, leave out lines 15 to 19 and insert—

  ("In section 162(4) (as amended by the Finance Act 1967) in its application to England and Wales, for the words in any theatre' there shall be substituted the words' on any premises', and the words' at that theatre ' shall be omitted.) — (Lord Stow Hill.)

  On Question, Amendment agreed to.
  LORD STOW HILL: I beg to move this Amendment.
  Amendment moved—
  Page 17, line 31, at end insert—

  ("The Licensing Act 1964(1964 c. 26).

  In section 199, as amended by the Finance Act 1967, the following shall be substituted for paragraph (c)—

  (c) make unlawful the sale or exposure for sale by retail without a justices' licence of any intoxicating liquor at any premises in respect of which a licence under the Theatres Act 1968 is for the time being in force, or which by virtue of any letters patent of the Crown may lawfully be used for the public performance of plays without a licence under that Act being held in respect thereof, if the proprietor of those, premises has given to the clerk to the licensing justices notice in writing of the intention to sell such liquor by retail at those premises and that notice has not been withdrawn;'.

  In section 200(1), as amended by the Finance Act 1967, for the word 'theatre' there shall be substituted the word 'premises'.")

  —(Lord Stow Hill.)

  On Question, Amendment agreed to.
  Schedule 2, as amended, agreed to.
  Schedule 3 [Repeals]:
  LORD STOW HILL: I beg to move.
  Amendment moved—
  Page 18, line 45, at end add—

  ("1967 c. 54.

  I The Finance Act 1967.

  In Schedule7, paragraph 19.")

  —(Lord Stow Hill.)

  On Question, Amendment agreed to.
  Schedule 3, as amended, agreed to.
  House resumed: Bill reported, with the Amendments.

  FRIENDLY AND INDUSTRIAL AND PROVIDENT SOCIETIES BILL
  8.36 p.m.
  LORD PEDDLE: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
  Moved, That the House do now resolve itself into Committee.—(Lord Peddle.)
  On Question, Motion agreed to.
  House in Committee accordingly.
  [The LORD CHAMPION in the Chair.]
  Clauses 1 to 11 agreed to.
  Clause 12 [Consequential amendments of rules by societies]:
  LORD PEDDIE: I will explain Amendments Nos. 1 and 2 together. They refer to a subsection which deals with a once-for-all period, so that the definite article is more appropriate than the indefinite one. That is the sole justification for these two Amendments. I beg to move.
  Amendment moved—
  Page 13, line 30, leave out ("a") and insert ("the").—(Lord Peddle.)
  On Question, Amendment agreed to.
  LORD PEDDIE: I beg to move the next Amendment.
  Amendment moved—
  Page 13, line 32, leave out ("a") and insert ("the").—(Lord Peddle.)
  On Question, Amendment agreed to.
  Clause 12, as amended, agreed to.
  Clauses 13 and 14 agreed to.
  Clause 15 [Meaning of "subsidiary"]:
  8.38 p.m.
  LORD DRUMALBYN LORD DRUMALBYN moved, in subsection (5), after the second "if", to insert:
  "the first-mentioned society transacts at least one half in value of its business with that other society or the members of that other society, and".
  The noble Lord said: I beg to move the Amendment standing in the name of my noble friend and myself and suggest that we should take No. 4 at the same time. I had intended to go into the merits of these Amendments in some detail but, owing to the late hour and to the limited number of noble Lords present, this will probably be unnecessary. Your Lordships will be aware from Second Reading and subsequent proceedings that this matter has already been ventilated.
  We are dealing with Amendments drafted by the Co-operative Insurance Society. I am now informed that owing to changes in the composition of the Committee of the Co-operative Insurance Society a majority of the Committee does not wish these Amendments to be pressed since, I understand, they are satisfied with the discussions and correspondence they have had on the subject with the Chief Registrar. There remains the minority who took a different view and as we are always jealous in Parliament of protecting the rights of minorities, I would have gone into this in more detail but for the present circumstances.
  The core of this matter is simply that the Co-operative Insurance Society did not wish to be treated for the purposes of this Bill, or indeed of any Act, as a subsidiary of its members, or, in particular, a subsidiary of the Co-operative Wholesale Society, which holds four-fifths of the shareholding, the comparatively small amount of £52,500, in this very large enterprise, the Co-operative Insurance Society, which has assets of £450 million and over. They took this view because they hold that the Co-operative Insurance Society is not comparable with a company, and therefore that the criteria for a company to be a subsidiary—namely, membership and control—do not apply to the Co-operative Insurance

  777
  Society, on the ground that the Co-operative Insurance Society is really independent. They put it in this way in the circular that they issued on June 6:
  "A company operates for the benefit of its ordinary shareholders, who are entitled to its disposable profits in proportion to the size of their shareholdings and control of its assets.
  "The position in a co-operative society is quite different. The basis of the co-operative philosophy and trading on which the whole of the Industrial and Provident Societies' legislation is founded is that a society should operate its business for the benefit of those making use of facilities it provides. It must pay no more than a strictly limited rate of interest on share capital and its disposable surplus should be returned to those making use of its facilities not to its shareholders as such."
  And then it goes on:
  "It is therefore a contradiction in terms to describe an Industrial and Provident Society as a subsidiary of another society even if the latter owns sufficient shares to give it majority voting power. The term 'subsidiary can only be properly applied to a proprietary organisation in which the shareholders are the proprietors. To apply the term 'subsidiary' to an I. and P. Society is to undermine the basic cooperative principle that an I. and P. Society cannot be a proprietary organisation and must be operated in the interests of the persons using the facilities of the Society regardless of how the shares are held."
  To some extent, in this Bill which deals primarily with accounts and also quin-quennial valuations—these are the principal subjects—it is possibly a rather academic matter in view of the discussions to which I have already referred and the assurances that have so far been given.
  The points at issue are simple enough. The first is: Does the fact that the Co-operative Wholesale Society control the management of the Co-operative Insurance Society mean that they control the assets? It has been established, I think, with reasonable certainty, that so far as the assets are concerned, except in the event of a winding-up, the assets are not available to the Co-operative Wholesale Society; they are to be used for the purposes of the policy holders. The Co-operative Insurance Society, I believe, have asked for an assurance in writing that the Co-operative Wholesale Society have no intention of winding up the Co-operative Insurance Society, nor any intention of manipulating the assets of the Co-operative Insurance Society in any way other than just to receive the
  778
  fixed dividend, which they have themselves fixed in accordance with the constitution of the Co-operative Insurance Society.
  The second point on which they have asked for an assurance is that the Cooperative Wholesale Society will avail themselves of Clause 14(2)(b), and not include this subsidiary, the Co-operative Insurance Society, in their accounts on the ground that the result would be:
  "misleading, or harmful to the business of the Society or any of its subsidiaries";
  or, indeed, on the ground of paragraph (c) of that subsection, that
  "the business of the Society and that of the subsidiary are so different that they cannot reasonably be treated as a single undertaking."
  The difficulty that arose here arose from the way in which the Co-operative Wholesale Society referred to their subsidiary, the Co-operative Insurance Society, in their accounts for the past year. It was feared by the Co-operative Insurance Society that the way in which this was done would reflect upon the position of independence of the Co-operative Insurance Society in the management of their affairs, and might prejudice the, business of the Society, and indeed the interests of their policy holders. They have, therefore, also sought an assurance: as to the way in which this reference would be carried in any accounts made in future under this Bill.
  I do not know what the noble Lord can tell us about this to-night, but I do not think there has yet been time for the Co-operative Wholesale Society to reply to the invitation for written assurances. But in view of the fact that the assurances have been obtained verbally I do not propose to press these Amendments to-night. It is a matter of judgment, of course, as to whether in defining a subsidiary for the purposes of co-operative societies it should be defined in the same way as a company. I think it is very doubtful.
  I should have preferred that the matter had been put beyond all doubt by finding a definition of a "subsidiary" for the purposes of a co-operative society similar to the Amendment that I have put down, if not in exactly those terms: because under my Amendment the present clause reads as follows:
  "For the purposes of this Act, an industrial and provident society shall be deemed to be a

  779
  subsidiary of another society if, but only if, the first-mentioned society transacts at least one half in value of its business with that other society or the members of that other society, and
  "(a) is a member of the first-mentioned society and controls the composition of its committee; or"—
  and this is not particularly relevant—
  "(b) can exercise a majority of the votes to which members of the first-mentioned society are entitled under its rules."
  Then it would continue, with Amendment No. 4:
  "For the purposes of this subsection, the first-mentioned Society shall be deemed to transact at least one half in value of its business with that other society or the members of that other society, unless the Chief Registrar is satisfied that this is not the case."
  The effect of this would, of course, have been to exclude the Co-operative Insurance Society, and probably no other co-operative society, because the Co-operative Insurance Society transacts very much less than half the value of its business with the Co-operative Wholesale Society or its members. So it would have been excluded automatically, and this would probably have been desirable, in view of the special position of an insurance society. After all, the Cooperative Insurance Society is in effect a mutual insurance society except for the fact that there is a shareholding held by the Co-operative Wholesale Society through which they are able to control the management of the Cooperative Insurance Society. But I take it that it would be open to the Co-operative Insurance Society at any time to do what other insurance companies have done; namely, to turn themselves completely into an independent co-operative insurance society, or, for that matter, into a mutual insurance company where the control would not lie with anybody else but would lie with the policy holders.
  However, that is not a matter that we are discussing this evening. The matter is a very much mere restricted one. It is purely and simply whether we should have a definition of a subsidiary so far as the Co-operative Society is concerned, which will exclude the Co-operative Insurance Society, or whether we should leave the words in the clause as they are. In view of the fact that the Co-operative Insurance Society itself seems to have received verbal assurances that are satis
  780
  factory to it, and is only awaiting the written assurances, I do not intend to press this Amendment, but I thought it was as well that the matter should have been ventilated. I beg to move.
  Amendment moved—
  Page 16, line 43, after second ("if") insert the said words.—(Lord Drumalbyn.)
  8.53 p.m.
  LORD PEDDIE: In moving this Amendment, the noble Lord stated that in view of the lateness of the hour he would curtail the range of his argument in support of the Amendment, but he has made a number of statements which I think justify some reply. He has quoted extensively from the documentation circulated by the C.I.S. to Members of this House some time ago, but I would remind the Committee—
  LORD DRUMALBYN: Would the noble Lord allow me to interrupt for one moment? I did not actually quote from the document addressed to this House; I quoted from the Press release which came, he will remember, on the 6th of the month, whereas the other document was issued, I think, on the 14th.
  LORD PEDDIE: That, of course, supplemented the original document and dealt with it in even greater detail. So I think it is necessary that a detailed reply should be given, because this is a matter that has aroused a considerable amount of interest and attention in the Co-operative Movement.
  This Bill is quite innocuous, calculated to do some good to co-operative and friendly societies, and it has been discussed between the Registrar and representatives of the leading co-operative organisations and the friendly societies for three years. There is complete agreement and no objection at all to this Bill. In his Amendment, the noble Lord introduces an entirely new element in the definition of a subsidiary. I can assure the Committee that after full and detailed consideration of all aspects of this point by the C.I.S., the objection of the C.I.S. Board has been withdrawn. As the noble Lord has stated, Clause 13 provides for group accounts where societies are registered under the Acts and have as their subsidiaries other societies or companies, and Clause 15 defines subsidiary. I know that a co-operative

  781
  society is not a company, but where a company is a subsidiary under this Bill the clause applies the test laid down in Section 154 of the Companies Act 1948; namely, the control of the board of directors, or the majority holding of equity share capital.
  When we come to a co-operative society the situation is a little different because there is no equity share capital. But the same basic principle is employed in determining whether one industrial and provident society is a subsidiary of another. The test is the exercise of voting powers, and subsection (5) applies two tests as to whether one society is the subsidiary of another: the control of the committee of management, and the control of votes. Both are tests of the power of one society to control the management of the other, and the subsidiaries are defined by reference to that power. It is important that the Committee should realise that in this Amendment an entirely new element and new test is being introduced as to whether or not one is a subsidiary of the other. In this particular case—and I would urge this upon the noble Lord, Lord Drumalbyn—it is to be based upon a judgment of the circumstances of a particular society's business. Accordingly, this Amendment would enable one society to approach the Registrar if it does not conduct at least one half in value (and I emphasise that) of its business with the society, or members of the society of which it would otherwise be a subsidiary. In so doing it would cease to fall within the definition of a subsidiary, in spite of the fact that control of management rests with the other society.
  This Amendment stems from attempts of the C.I.S. to devise a formula to avoid falling within the definition of a subsidiary. Nevertheless the rules of the C.I.S. empower the C.W.S. to appoint eight out of ten of the directors and to exercise four-fifths of the members' votes. Thus clearly the C.I.S. comes within the definition of subsidiary on both present tests.
  I should like to emphasise to the Committee and to place on record that these Amendments are wholly unnecessary and would indeed create serious complications. The Bill already, in Clause 14(2), provides for exemption from the requirement of group accounts if the result is
  782
  misleading or harmful, or the two businesses are so different that they cannot be treated as a single undertaking.
  The noble Lord asked me to make a positive statement in regard to this. I can, and I will. The C.W.S., as the parent organisation, recognised that the two classes of business were so different that they could not be regarded as a single undertaking. Therefore there is no suggestion of the incorporation of the accounts of the C.I.S. into those of the C.W.S., and assurances have already been given. I might also point out that even in spite of that there is within the Bill a clear indication of the necessary for accounts to be presented in such a way that they must avoid anything misleading that may result from the consolidation of accounts. Therefore I suggest that the exemption provided by Clause 14(2)(c) would enable independent accounts as before.
  It was suggested also by the noble Lord, Lord Drumalbyn, that it might be considered wrong to apply the present test to societies run on co-operative principles, but as a matter of fact there are several co-operative societies which control other co-operative societies. In most cases where such control exists, the relationship is such as to justify group accounts covering the affairs of both societies. I might refer to co-operative chemist societies, of which there are about 75 in Britain, and the Co-operative Tea Society, which is a big national society, is a further example. The present test in the Bill looks simply at the power of control and defines subsidiaries by reference to that power. I would also make quite clear that this Bill simply acknowledges a situation which has long existed. The relationship between the C.I S. and the C.W.S. has existed for many years and nothing in this Bill will alter that relationship.
  I suggest also that the Amendment would complicate and distort the accepted meaning of "subsidiary". It would also create very serious practical difficulties. I am quite sure the noble Lord, Lord Drumalbyn, has not appreciated the difficulties that could arise in this practical form. The first arises from the use of his word "value" in referring to the business of the society. Depending on the nature of the society's business, "value" may vary according to the way it is

  783
  approached. It might be simple for the C.I.S. to establish "value", actuarily or otherwise, but societies carrying on mixed business, agriculture societies or others which supply services as well as goods, could find difficulty in deciding which yardstick to apply. Is the value of the services the cost to the member or the profit to the society, or the actual value to the member, which may be considerably in excess of any of these figures? The Amendment gives no guidance at all on how to determine value.
  There is a further really serious difficulty. We must not relate this Amendment solely to the C.I.S.: it would apply to all societies that could be considered subsidiaries within the definition, and the difficulty would arise that they would have the problem of establishing the status of persons with whom they do business. The Amendment would require that an inquiry be made of every customer as to his membership of another society. With the C.I.S. again this would present no difficulty, but the majority of co-operatives deal with individuals who do their trade across the counter, and there would be considerable difficulty. And it is quite clear that this Amendment, which arose out of the original attitude of the C.I.S. and met the needs of the C.I.S., takes no account of the position of other societies.
  I must wind up by pointing out another serious difficulty. The use of the word "subsidiary" is not confined to Clause 15. Clause 8 of the Bill prohibits any officer of a society from acting as the auditor of a subsidiary under the present definition of subsidiary as in Clause 15. So that it follows that an officer of a society which controls another cannot act as the auditor of that other, and that is quite clearly a desirable restriction. The Amendment would cut across this and enable an officer of the C.W.S. to audit the accounts of the C.I.S. notwithstanding the element of control involved. Therefore I feel that on a rational consideration of the full impact of these Amendments there is really no justification for them at all. But I am glad that the noble Lord, Lord Drumalbyn, has no intention of pursing this matter. I welcome the opportunity of clarifying a situation which has been
  784
  something of a problem over the past few days.
  LORD DRUMALBYN: I am grateful to the noble Lord for his response to this Amendment. He perhaps went into a little more detail than necessary, even to reply to my Amendments, but I do not complain about that in the slightest. He says that this Amendment would introduce an entirely new test of what a subsidiary is, but one has to have regard to the words here. In any case, this is only a definition of "subsidiary" for the purposes of this Bill, to decide how accounts are to be grouped and in what circumstances they are to be grouped by the parent company. So I do not think that would be a serious objection at all.
  I did not myself go into the other kinds of co-operative society, and of course there would not be any difficulty at all as far as the Co-operative Tea Society is concerned. In each case it would be a matter for the subsidiary to make their case to the Registrar if they wanted not to be counted as a subsidiary, and it would be a matter for the Registrar to be satisfied, and he could decide for himself how he would treat "value" for this purpose. My information is, and I may be right or not, that in most cases there would not be a very great deal of difficulty. I say that, however, merely in defence of the Co-operative Insurance Society, who, I am sure, did not think of this definition lightly and went into it with some care; they must be presumed to know quite a lot about the co-operative movement, and I do not think they would have put this down if it was going to be so very difficult to operate. I think we are probably now at one on this. I need not pursue the Amendment further, and, thanking the noble Lord, I beg leave to withdraw the Amendment.
  Amendment, by leave, withdrawn.
  Clause 15 agreed to.
  Clauses 16 to 21 agreed to.
  LORD PEDDIE LORD PEDDIE moved, after Clause 21, to insert the following new clause
  Channel Islands and Isle of Man
  "—(1) Her Majesty may by Order in Council provide—

  (a) that all or any of the provisions of this Act shall extend to any of the Channel Islands, or

  785

  (b) that all or any of the provisions of this Act, in so far as those provisions relate to societies registered under the Act of 1896, shall extend to the Isle of Man,

  with in either case such exceptions, adaptations and modifications (if any) as may be specified in the Order.
  (2) Any Order in Council made under this section may be varied or revoked by a subsequent Order in Council so made.
  (3) Any Order in Council revoking an Order in Council made under this section may contain such transitional or other incidental or supplemental provisions as appear to Her Majesty to be necessary or expedient in consequence of the revocation."
  The noble Lord said: This is quite a simple Amendment. The present Bill does not extend to the Channel Islands or the Isle of Man, and the purpose of this clause is to bring the Bill into line with the principal Act so far as the Dependencies are concerned. The clause provides for an extension by Order in Council, rather than the direct application to be found in the principal Act, and this change is due to the constitutional relationship between the United Kingdom and the Islands which requires that the application of United Kingdom legislation is made only in agreement with the island Governments. Consultations between the two parties have only just been completed, which is the reason why the clause did not appear in the Bill when originally introduced. I beg to move.
  Amendment moved—
  After Clause 21, insert the said new clause. —(Lord Peddle.)
  On Question, Amendment agreed to.
  Clause 22 agreed to.
  Schedule 1 [Minor and consequential amendments]:
  LORD PEDDIE: With your Lordships' permission I would speak to Amendments 6, 7 and 8 in Schedule 1. These Amendments revise the wording of certain provisions of the Friendly Societies Act 1896 and the Industrial and Provident Societies Act 1965. They are simply consequential upon the provisions of the Bill abolishing approved auditors and providing for the valuation of part or parts of the business carried on by a society. I beg to move.
  Amendment moved—
  Page 24, line 5, leave out from ("of") to ("balance") in line 7 and insert ("copy of
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  last balance sheet and valuation report at registered office)—

  (a) for the words 'of the last quinquennial valuation' there shall be substituted the words a copy of the last report under section 28 of this Act on the condition of the society or branch or, where a report or reports are required under that section in respect of a particular business or particular businesses conducted by the society or branch, a copy of the last report under that section in respect of that business or in respect of each of those businesses, as the case may require'; and

  (b) for the words 'any special report of the auditors' there shall be substituted the words 'the report of the auditors or the'"). —(Lord Peddie.)

  On Question, Amendment agreed to.
  LORD PEDDIE: I beg to move.
  Amendment moved—
  Page 24, line 39, at end insert—
  ("In Schedule 1, in paragraph 11 (rules of certain societies registered under the Act to provide for valuations of assets and liabilities), for the words from 'a valuation' to the end of the paragraph, there shall he substituted the words 'such periodic valuation or valuations (if any) of the assets and I abilities of the society as a whole, or of the assets and liabilities of the society in respect of any particular business or businesses conducted by the society, as may from time to time he required by law in the case of that society '.")— (Lord Peddle.)
  On Question, Amendment agreed to.
  LORD PEDDIE: I beg to move.
  Amendment moved—
  Page 25, line 28, at end insert—
  ("In Schedule 1, in paragraph 10 (rules of societies to provide for audit of accounts), for the words 'approved auditors' there shall be substituted the words auditors appointed by the society in accordance with the requirements of the Friendly and Industrial and Provident Societies Act 1968'.").—(Lord Peddle.)
  On Question, Amendment agreed to.
  Schedule 1, as amended, agreed to.
  Schedule 2 [Repeals]:
  LORD PEDDIE: This Amendment is to provide consistency with Clause 16 of the Bill. It disposes of the need for Treasury approval. Clause 16(3), allows the Chief Registrar to dispense with the valuation in respect of any particular business conducted by a society. Treasury approval is not needed for the exercising of this power and the Amendment, by deleting the requirement that

  787
  Treasury approval be obtained, brings Section 28(5) of the Friendly Societies Act 1896 into line with Clause 16. This is, in point of fact, a Treasury Amendment—at least, the Treasury have agreed to the Amendment and I am given to understand they did, in fact, suggest it.
  Amendment moved—
  Page 25, line 41, leave out ("and subsection (3)") and insert ("subsection (3), and the words 'with the approval of the Treasury' in subsection (5).").—(Lord Peddie.)
  On Question, Amendment agreed to.
  LORD PEDDIE: Again with your Lordships' permission, I would take Nos. 10 and 11 together. They are simple Amendments. In view of the abolition of the approved auditor, these are simply consequential Amendments to the principal Act. I beg to move.
  Amendment moved—
  Page 25, line 42, at end insert—
  ("In section 80(1) the word 'approved'.").— (Lord Peddle.)
  On Question, Amendment agreed to.
  LORD PEDDIE: I beg to move.
  Amendment moved—
  Page 26, line 4, at end insert—
  ("In section 72(2) the words 'or approved auditor'.".—(Lord Peddle.)
  On Question, Amendment agreed to.
  Schedule 2, as amended, agreed to.
  Schedule 3 [Transitional provisions]:
  LORD PEDDIE: Again with your Lordships' permission, I beg to move Amendments 12 and 13 together. These Amendments delay the effect of the repeal of the words "approved auditor" in Section 100 of the 1896 Act and Section 72(c) of the I. and P. Act, 1965. This is to cater for the transitional period when the approved auditor will be passing out of existence. I beg to move.
  Amendment moved—
  Page 26, leave out lines 26 to 31 and insert ("in respect of any year of account,
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  nothing in section 20(1) of this Act shall affect the operation—

  (a) of section 100 of the Act of 1896, in the case of a society registered under that Act, or

  (b) of section 72(2) of the Act of 1965, in the case of a society registered under that Act,

  in relation to documents purporting to be signed by the approved auditor to whom the accounts of that society for that year of account are submitted for audit under section 26(1) of the Act of 1896 or under section 37(1) of the Act of 1965, as the case may be.").—(Lord Peddle.)
  On Question, Amendment agreed to.
  LORD PEDDIE: I beg to move Amendment No. 13.
  Amendment moved—
  Page 26, line 37, after ("1896") insert ("or section 72(2) of the Act of 1965.").—(Lord Peddle.)
  On Question, Amendment agreed to.
  Remaining Schedule, as amended, agreed to.
  House resumed: Bill reported, with Amendments.

  LEICESTER CORPORATION BILL
  The CHAIRMAN OF COMMITTEES The CHAIRMAN OF COMMITTEES informed the House that the opposition to the Bill was withdrawn: the Order made on June 12 last discharged, the Bill committed to the Committee on Unopposed Bills.
INTERNATIONAL MONETARY FUND BILL
  OVERSEAS AID BILL

    SWAZILAND INDEPENDENCE BILL
    Brought from the Commons; read la, and to be printed.
    House adjourned at a quarter past nine o'clock.