Sitting of 26 July 1968

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

MUNICIPAL BUSMEN'S PAY (STANDSTILL ORDER)
The Under-Secretary of State for Employment and Productivity (Mr. Roy Hattersley): With permission, Mr. Speaker, I should like to make a statement.
As the House will be aware, since a notice of intention to extend the standstill on the municipal busmen's settlement was published on 11th July, my right hon. Friends the First Secretary and the Minister of Transport have made strenuous efforts to find a solution to this dispute which would be consistent with the Government's productivity, prices and incomes policy. Unfortunately, these efforts have so far been unsuccessful. An Order has, therefore, been made today extending the standstill on the municipal busmen's settlement of 14th December, 1967.
Yesterday, my right hon. Friend informed the House that the Government were prepared to accept a new settlement which would give an immediate increase of £1 to municipal busmen as part of a wider productivity agreement, and she also made clear that if these terms were agreed any standstill would be lifted immediately.
The House will be aware that the executive committee of the Transport and General Workers' Union yesterday gave authority for a strike of municipal busmen from 12th August. In these circumstances, I should like to repeat the plea which my right hon. Friend made to the busmen yesterday to accept in their interests and those of the travelling public a settlement on the lines suggested.
Mr. R. Carr: We are grateful to the Under-Secretary for making a statement, but I am sure that he will be the first to agree that what he has said does not
1156
tell us very much. I should like to ask him two questions. The first is general: does he realise that what is involved here, if the strike takes place, is a strike not against employers—because unions and employers are in agreement—but a strike against the Government? Is he aware of the very serious implications of this position and can he assure the House that the Government have really thought through the implications for the public, the problems of enforcement and the future of industrial relations?
Secondly, on the merits of this case, would the hon. Gentleman agree that there are here involved two criteria— "criteria" in the sense of incomes policy jargon, namely, the criterion of the lower-paid workers and the productivity criterion? Can he distinguish these criteria for us and make clear why the productivity of the lower-paid does not apply?
Mr. Hattersley: As to the first question, certainly neither I nor my right hon. Friend minimises the importance of the issue which faces us, nor the repercussions of a strike in this industry. Both she and I continue to hope that before the strike date an acceptable settlement can be found between all parties which, I freely acknowledge, include the Government.
The second point that the right hon. Gentleman makes is about the criteria applied to this dispute. It is not simply a matter of dispute about productivity and lowest-paid workers. There is also an issue about back-dating, and it is only the issue of back-dating in terms of productivity that now divides the parties and the Government; and it is one of the things that encourages my right hon. Friend and I to urge upon the parties an agreement before 12th August.
Mr. Heffer: Will my hon. Friend ask his right hon. Friend to desist from pursuing her present destructive and disastrous course? Is it not clear that if the Order extending the date of the standstill to 26th December is confirmed a head-on clash is inevitable, not only with the Transport and General Workers' Union but with the whole trade union movement itself?
Further, how does the new General Secretary of the Labour Party stand in relation to this matter—
Mr. Speaker: Order. Supplementary questions must be reasonably brief. Other hon. Members also wish to ask questions.
Mr. Heffer: I should also like to ask my hon. Friend whether his attention has been drawn to Appendix A of the Annual Report of the National Prices and Incomes Board, which clearly indicates that the whole prices and incomes policy is not worth a candle?
Mr. Hattersley: Let me take the final question first. I do not think that the intention of the Report which was published yesterday was that suggested by my hon. Friend. I should have thought that the entire implication of what is there written is that the policy is working and can be made to work even more successfully.
As to the General Secretary of the Labour Party, I answer for many people from time to time in this House, but the General Secretary of the Labour Party does not number among them.
The first question is the fundamentally important one. My right hon. Friend certainly does not minimise the problems and dangers involved in insisting that the prices and incomes policy should be applied appropriately and properly, but our hope is that both the specific unions involved in this dispute and the trade union movement understand both the reasonableness of the Government's position and the necessity to maintain a reasonable prices and incomes policy in the national economic interest.
Mr. Edward M. Taylor: In view of the major chaos and strife which inevitably will stem from this, will the Under-Secretary make clear that the Government will not go into battle unless they mean business? Has the best and a binding offer now been made? Can the hon. Gentleman assure us that we shall rot have the ridiculous situation as we had over the railway dispute, of the men being given, after two weeks of major chaos, all that they were refused before?
Mr. Hattersley: I do not agree with the hon. Member's assumptions about the railway dispute. Between now and 12th August, and if necessary later, my right hon. Friend remains available to talk to the parties in the hope that an agree-
1158
ment can be obtained which is in conformity with prices and incomes policy and acceptable to the parties and which therefore, avoids a disastrous dispute.
Mr. Michael Foot: While everyone must still hope that an honourable settlement can be reached in this dispute, will my hon. Friend recognise that large numbers of hon. Members on this side of the House, and even greater numbers of people in the Labour movement outside, are still bitterly opposed to the application, or any considered application, of the penal sections of the Prices and Incomes Act? Therefore, will he, on behalf of the Government, give an undertaking that if at any point the application of that part of the Act appears conceivable Parliament will be recalled so that a matter of great constitutional significance shall be discussed?
Mr. Hattersley: Parliament has already decided that what my hon. Friend describes as "the penal parts of the Act" shall be passed into law. The implications of that decision are that the actual mounting of such an operation is not one for the Government, but for the Attorney-General operating in a judicial capacity without the pressures which are perhaps appropriate on other Ministers on other occasions. Therefore, because of the special considerations which properly involve the so-called penal powers, I can give the House no assurance about them except that the law, through the functions of the Attorney-General will be applied.
Mr. Bessell: Is the hon. Gentleman aware that he and his right hon. Friend will have the best wishes of everyone in continued negotiations with the unions? What continuous planning is being done to prevent chaos and hardship for the travelling public?
Mr. Hattersley: One of the features of previous local bus strikes has been that the travelling public have been singularly successful in making alternative arrangements. Even allowing for that, I do not deny that if there is a strike on 12th August there would be some disadvantage, inconvenience and hardship for the travelling public. The Minister of Transport has that in mind, but the main aims of my Ministry are bent towards ensuring that a strike does not occur.
Mr. Mikardo: Does my hon. Friend recall that during the proceedings on the Prices and Incomes Bill I asked him on a number of occasions what was the rush and whether the purpose of the rush was to catch the busmen? Does he recall that finally, after some pressure, he said no, that was not the case? In view of the fact that within hours of the Act coming into law action was taken against the busmen—I shall not ask him, because it would be out of order whether that statement was a manifest untruth—but may I ask him, instead—
Mr. Speaker: Order. Questions must brief.
Mr. Mikardo: —whether he was not misleading both the House and the busmen and making his task of negotiation all the more difficult?
Finally, may I ask my hon. Friend whether he looks forward with pleasure to the visit, for which there are honourable precedents, to Mr. Frank Cousins, in Wormwood Scrubs, in order to negotiate a settlement of the strike?
Mr. Hattersley: My hon. Friend is assuming many things and I make none of the assumptions which underlie the second part of his question.
As to the first, the rush, as he described it, was dealt with in Committee by my right hon. Friend on 28th May and by me on Report on 26th June. My right hon. Friend and I specified to the Committee and the House the settlements which might come under Section 3(4) of the Act. There was no attempt to delude the House or to keep from the House that this agreement and that facing draughtsmen might be included under Section 3(4) if it were carried.
What we both said on those two occasions was that it was our dearest wish that the Clause would be unnecessary, if carried, because agreement would be obtained in these disputes. I said that on that very day discussions were going on to bring the dispute to an end and that it was our wish that the powers would not be used because a voluntary settlement might make them unnecessary.
Mr. Tilney: Is the hon. Gentleman aware that months earlier in the year the citizens of Liverpool suffered from an unofficial bus strike? Are they now to
1160
suffer from an official one? Is it not time that we had a statutory cooling-off period before a strike occurs?
Mr. Hattersley: That is another question which was debated at great length a fortnight ago. I very much doubt whether the disadvantages to which the hon. Member referred would be removed by a statutory cooling-off period at this time.
Mr. E. Rowlands: Does my hon. Friend realise that his announcement today will cause great dismay in South Wales and force South Wales busmen to strike at a time when the economy of South Wales is in great difficulty? As to the penal powers, what is the position of representative bodies like the Cardiff constituency Labour Party and bodies like mine which have passed resolutions recently expressing support and giving sympathy to Cardiff busmen? Will they be in the same position as Mr. Frank Cousins and fined £500 as well?
Mr. Hattersley: I am loath to make judgments as to the application of the law in this matter, certainly to parties only vicariously concerned, but I think that the members of the Cardiff constituency Labour Party can sleep safely in their beds. It is unlikely that the powers will fall on them.
Mr. Biffen: Can the Under-Secretary confirm that the dispute now entirely and exclusively turns on the issue of back-dating? If so, will he confirm that there is nothing in the Prices and Incomes Act, 1968 which prevents the back-dating of claims once that Act falls, as it is planned so to do, in 1969? Does he realise the immense significance of narrowing this issue merely to one of back-dating in relation to the law as it now stands?
Mr. Hattersley: Certainly, when the powers of the current Act lapse at the end of next year there will be nothing to prevent any employer back-dating any agreement and paying retrospectively, although every employer will be encouraged by the Government not to do so. As to the area of dispute between the parties and the Government in the municipal busmen's dispute, the hon. Member is right in believing that one of the principal features is a wish by the parties to back-date. But he will

1161
understand that, since the back-dating involves retrospective payment, if my right hon. Friend were to accept a productivity payment dated back to over six months before the agreement was realised, the agreement would be making nonsense of all the productivity statements and plans on which the Government's policy is largely based.
Mr. Ellis: Will the hon. Gentleman make clear what is on offer now? Did he say, as I understood him to say, that the £1 on the basic rate is now accepted by the Government and that the only point now in dispute is back-dating?
Mr. Hattersley: Certainly, if the dispute were ended today, and if the parties came to an acceptable agreement today, it means an immediate £1 in the bus man's pay packet. [An HON. MEMBER: "Basic?"] Ten shillings of it would be basic and 10s. would be bonus for one-man operation, but whether it is calculated as basic or bonus it means an immediate £1 as soon as the settlement is reached.
Sir Harmar Nicholls: The Undersecretary has said that he recognises the inconvenience which will come to the general public and that the general public will have a lot of self-help, as in the past, to minimise it. If there were a stoppage which looked like being protracted, can he assure the House that there are blueprints in existence which, at any rate from the centre, will set about providing some sort of skeleton service so that the general public can get about their normal daily business?
Mr. Hattersley: As it is still our hope that the dispute will not come about, I am certainly not going to give the House and the country any assurance about skeleton blueprints at the centre which I am sure both parties to the dispute would regard as an inflammatory operation and something which they would interpret as an extension of the Government's belief that the strike would continue. We stand on the position that between now and 12th August we still hope that the strike can be avoided.
Mr. Spriggs: May I raise with my hon. Friend the question of the St. Helens Corporation transport undertaking? This undertaking and the trade unions concerned have a productivity agreement
1162
covering single manning, overtime and standing room. Is not this a case where the payment should have been made and can be made right away?
Mr. Hattersley: I honestly cannot give my hon. Friend an immediate judgment about the St. Helens situation, but I promise him that I will look at it and consider whether it is a special exception. I will examine the position in some detail.
Mr. Emery: What would be the position if busmen in county services normally staffed by members of the N.U.R. were to come out in sympathy with their fellow busmen in municipal areas, as has frequently happened? What action under the Prices and Incomes Act would be taken by the Government against such men acting in sympathy?
Mr. Hattersley: It is clear from the Prices and Incomes Act that it is an offence to take any action which is intended to promote the breach of an Order. That is the general position. As to what action would be taken by the Government, the hon. Gentleman must simply rely on my earlier statement that this is a matter for my right hon. and learned Friend the Attorney-General acting in his judicial capacity, and one on which it would be wrong for me to comment.
Mr. Raymond Fletcher: Will my hon. Friend explain to me why a policy which proved to be a scrap of paper in relation to the railwaymen should be transformed into a blade of steel when it is applied against the bus workers? Are we to understand now, if the issue at stake is the simple one of back-dating, that the well-known ingenuity of his Department is completely exhausted?
Mr. Hattersley: I do not believe that the ingenuity of my Department is exhausted, even though it has been operated extensively over the last few weeks. Even more strongly do I not believe that my hon. Friend is right in saying, or implying, that the prices and incomes policy was breached by the agreement in respect of the railwaymen. Several questions have been based on that assumption, and that assumption is entirely wrong.
Mr. Longden: Is the Under Secretary aware that, whatever his hon. Friends

1163
may think, he will have the great majority of the public behind him—[An HON. MEMBER: "How does the hon. Gentleman know that?"]—if he sticks firmly to the line which he so clearly expressed to the House this morning?
Mr. Booth: Does my hon. Friend agree that the introduction of single-manned buses in municipal services would be a major contribution to productivity in the public transport sector and that in view of this the 10s. bonus, if not paid retrospectively, would be rightly regarded as miserably inadequate and inevitably lead to a protracted and bitter dispute?
Mr. Hattersley: I think that it is important to understand what the 10s. bonus amounts to. The 10s. is an acceptance bonus which we ask busmen to take simply as part of a deal in which their only concession is a statement of agreement to accept single-man operation. In those undertakings where single-man operation is applied and where single-manning becomes common, the men actually participating in the single-manning will get substantial increases above the 10s. The 10s. is no more than an acceptance bonus.
Mr. Dickens: May I remind my hon. Friend of a point made at the very beginning of these exchanges, namely: why are the Government going to throw away all the advantages we are now getting from devaluation by running into a head-on clash with the trade union movement? Is he aware—and can I make him aware beyond any reasonable question of doubt —that should the penal sanction be imposed against the Transport and General Workers' Union the Government will meet with the most resolute opposition from many of us on this side of the House and by the movement in the country?
Mr. Hattersley: I am very well aware of the resolute opposition that the Government would meet with from my hon. Friend. Indeed, I am aware of the resolute opposition they have met in the past over similar matters. I must say to him, in terms of throwing away the advantages gained from devaluation, that the Government have to take a number of decisions about devaluation. One of the ways in which we might throw away the advantage is were we to allow inflation, costs and prices, to go ahead at
1164
such a rate that the benefits obtained from that decision were dissipated. The entire objects of the prices and incomes policy is to ensure that that dissipation does not come about.
Mr. Orme: Is my hon. Friend aware that this argument about back-dating which he has put to the House as the only problem in the settlement is the problem because the busmen have been negotiating for so long for a settlement and that, in fact, they have been exceedingly patient and conceded many points to the Government? Does not my hon. Friend agree that it is time the Government got out of these negotiations and allowed the industrial process to take place in the normal manner? Perhaps then we could get some industrial settlement and his Department could return to its original job of being a conciliatory body.
Mr. Hattersley: I reject the idea that back-dating arises only because the Government have postponed an agreement. We are prepared to accept a payment for one-man operation from the date at which one-man operation became acceptable to the industry. No blame for any delays can be placed at the Government's door. All we have sought to do thoroughout the negotiations is to explain to the parties how they could get a substantial increase in conformity with prices and incomes policy. That seems to me to be our proper rôle and our proper task.
Mr. John Lee: Has my hon. Friend made any estimate in his Department of what the economic cost will be if there is a national bus strike and if this in turn leads on to sympathetic strikes in the rest of industry? Is my hon. Friend really aware, even now, of the sense of outrage that is felt in the Transport and General Workers' Union and other unions? May we have an assurance that if a national strike is pending the House will be recalled to consider the situation which would then arise?
Mr. Hattersley: The question about the recall of the House is certainly not for me, but for my right hon. Friend the Leader of the House. It is very difficult to make a calculation of the economic cost of such a strike. It is equally difficult to make a calculation of the costs involved in allowing bus fares to increase and in allowing the situtation

1165
to develop in which cost increases appeared to be acceptable to the Government. The task of my right hon. Friend is to decide which of these two unpalatable alternatives is the least disastrous; and it is not a decision which she can take lightly.
Mr. R. Carr: The hon. Gentleman said something very important when he undertook to look at the St. Helens case as a special one. I am sure that one of the troubles here is a lot of special cases. Will he undertake to look at it town by town and, therefore move in the direction of Donovan, which would get away from meaningless industry-wide agreements to significant special ones?
Mr. HattersleyAs the right hon. Gentleman knows, as a general principle I am very much in favour of what he has described as the Donovan attitude. I will examine the possibility of this; but I have to tell him and the Home that there are other long-term implications. One is the status of the negotiating agreement and the negotiating machinery in this industry. Certainly, neither my right hon. Friend nor I would want to do anything to undermine the accepted negotiating machinery througth which we have continued to work and which we hope will prosper. If we were to examine agreements town by town we would have to be careful not to do it in way which would in any form erode the responsibilities of the unions and of the national bodies.
Several Hon. Members rose—
Mr. Speaker: Order.
Mr. Heffer: On a point of order. I wish to move the Adjournment of the House—
Mr. Speaker: Order. Standing Order No. 9 does not bite on a Friday. The hon. Gentleman cannot move for an Adjournment under Standing Order No. 9.
Mr. Heffer: Further to the point of order. I fully recognise, Mr. Speaker, that in normal circumstances Standing Order No. 9 does not operate on a Friday. I submit that this is not a normal Friday. This is the end of the Session prior to the Recess. Therefore, no hon. Member will have an opportunity of raising this matter on Monday, because the House does not meet on Monday. I
1166
think that this is a special circumstance. I therefore ask that this matter be looked at again.
Mr. Speaker: Order. I am not unsympathetic to what the hon. Gentleman has said. Mr. Speaker is often urged to do a great right by doing a little wrong, but Mr. Speaker is bound by the Standing Orders of the House. Standing Order No. 9 does not operate on a Friday.
Mr. C. Pannell: On a slightly different point of order, Mr. Speaker. I did not want to interrupt questions on an issue about which hon Members felt strongly, but may I ask that during the Recess you have a look at the supplementary questions which have been asked this morning and see how many of them breach the well-known rule by being completely hypothetical. I refer particularly to the supplementary asked by the hon. Member for Honiton (Mr. Emery).
I shall say no more than that this morning, because I had the somewhat painful personal experience of being pulled up by Mr. Speaker Morrison for the same sort of thing. I believe that this rule is being breached by hon. Members asking remote, hypothetical questions which no Minister can be responsible for or answer.
Mr. Speaker: I did not hear all that the right hon. Gentleman said, but the hypotheses which have been referred to in the questions are, if not probable, at any rate not utterly impossible. May we proceed?
Mr. Mikardo: Further to the point of order put to you Mr. Speaker, by my hon. Friend the Member for Liverpool Walton (Mr. Heffer). May I make a respectful submission and ask for your guidance? One of the difficulties in connection with Standing Order No. 9 is that it provides for a debate on the Adjournment, and today we are on the Adjournment anyway. I see that difficulty. But, Mr. Speaker, as you are always so kind in guiding and helping hon. Members, can you suggest any way in which this matter, which is one of the gravest urgency, could be debated shortly today?
We have a number of subjects set down for the Adjournment debate. While all of them are important to the House and

1167
to the country, some of them are manifestly less urgent. Is there any way by which, although time has already been allocated, it would be possible to make some reallocation of the time to permit, during the normal course of the Adjournment debates today, a small amount of time to be devoted to this subject?
Mr. Speaker: All that the hon. Gentleman says amounts, in effect, to a request for a small Standing Order No. 9. There can, however, be neither a small Standing Order No. 9 nor a big one on a Friday. There is nothing I can do unless the business set down for the day is finished before 4.30.
Several Hon. Members rose—
Mr. Speaker: Order. I must protect the business of the House.

METRICATION
The Minister of Technology (Mr. Anthony Wedgwood Benn): With permission, Mr. Speaker, I should like to make a statement about metrication.
In May 1965, the Government announced their support for the adoption of the metric system of weights and measures in industry which had been proposed by the Federation of British Industries. They also accepted that the metric system would spread outwards from industry and become in time the primary system for the country as a whole. The Government consider that this will bring substantial advantages. More than three-quarters of world trade is now conducted in metric units. All the Commonwealth countries except Canada have changed to the metric system or are about to do so, and studies are in progress in the United States and Canada.
In 1966, my predecessor appointed the Standing Joint Committee on Metrication, representing industrial management, the trade unions and the Government, to encourage, assist and review the progressive adoption of the metric system by British industry. A report by that Committee will be published today by Her Majesty's Stationery Office. I have placed copies in the Library of the House, and copies are available in the Vote Office.
1168
The Report makes three main recommendations. First, that manufacturing industry can make the change efficiently and economically only if the economy as a whole moves in the same direction on a broadly similar time-scale, and in an orderly way. Second, that a Metrication Board should be established to guide, stimulate and co-ordinate the planning for the transition for the various sectors of the economy. Third, that any legal barriers to the use of the metric system for all purposes within the United Kingdom should be removed.
The Government accept the recommendation that a Metrication Board should be set up as soon as possible. Every sector of the economy need not move at the same pace. But there will be unnecessary confusion and expense, and great difficulties for industry, unless there is central machinery for co-ordinating the programmes of change for the various sectors.
The Board will be advisory. The adoption of the metric system must be gradual, through democratic procedures based on the widest consultation. Membership of the Board will, therefore, reflect the interests of industry, the distributive trades, education—for which there are important implications—and, particularly, the general public and consumers. The Board will need to ensure that the distributive trades and consumers are consulted and have ample notice of proposed changes.
No compulsory powers will be sought. There can be no question of compensation; the costs of adopting metric weights and measures must lie where they fall.
The Government agree that programmes for the different sectors of the economy can be properly co-ordinated only if there is some general guidance on the timing. They therefore accept the end of 1975 as the target date for all provisional programmes, with the qualification that if this date proves to be unreasonable for any particular sector, the programme may aim at an earlier or later date. An initial task of the Metrication Board will be to submit to the Government an appreciation for each sector, including, so far as practicable, the costs and other considerations involved. In the light of this, programmes can be drawn for individual sectors. The Government will not be committed to

1169
endorse the programme for any sector of the economy before final proposals for that sector are submitted.
The Government accept that legislation will be needed to remove obstacles to the adoption of metric units and to define the units to be used. Further consultation is, however, needed before the timing of the legislation can be decided. Arrangements will be made to coordinate the interests of Government Departments so that they play their full part—[HON. MEMBERS: "Too long."] This is an important statement. I hope that the House will listen—so that they may play their full part in the consideration of programmes and so that the public sector keeps in step as the programmes develop.
The educational system will need to keep pace with, and to some extent anticipate, changes. The conversion will stimulate industrial and commercial modernisation and the rationalisation of production by variety reduction. We must also use it to help our export trade by harmonising our standards with those of our customers overseas.
The adoption of the metric system in the United Kingdom will represent a major change affecting many aspects of the national life, and I hope that publication of this Report will lead to a wide public discussion of the issues involved
Mr. Speaker: I remind the House that we are cutting into the business of the day.
Sir H. Legge-Bourke: We are all extremely conscious of that, Mr. Speaker. I only wish that the statement could have been made on another day. It is an important statement, and I hope that you will allow me to put a few questions on it, as this is the last opportunity we shall have before we rise for the Summer Recess.
Mr. Speaker: I hope that the questions will be reasonably brief.
Sir H. Legge-Bourke: Certainly, Sir —as brief as I can make them.
Can the Minister give some idea of the cost and savings benefits which are likely to arise from the full application of the scheme? Second, who will be on the proposed Metrication Board? Will it be a reproduction of the Standing Joint Committee which has already been
1170
set up? Third, in welcoming the coupling of education in this matter, I ask the right hon. Gentleman to say whether the industrial training boards will be brought in, too.
Mr. Benn: I apologise to the House for the length of the statement, but it was an important matter.
It is impossible to do an accurate calculation of cost-benefit, since it varies from industry to industry. Some of the benefits are unquantifiable, for example, in variety reduction, export promotion, and so on. No other country has been able to do it.
As regards membership of the Board, I ask the hon. Gentleman to await the statement.
Industrial training will be involved at an early stage; it is part of the educational change.
Mr. Richard Wainwright: In deference to your request, Mr. Speaker, I put only one question. Since the Minister said that the Metrication Board is to be advisory only, and as the part of his statement dealing with co-ordination among Government Departments is vaguely phrased, to say the least, may I ask him to give an assurance that co-ordination on metrication in the activities of Government Departments will be enforced so that local authorities, for example, will not be required by some Departments to talk in metric terms while other Government Departments insist that town halls talk in traditional terms?
Mr. Benn: There will be no compulsion. As I made clear, from the Government's point of view every Department is involved, but I shall be formally responsible for co-ordination of Government activities in this field.
Mr. English: Does the Minister realise that we welcome the lack of compulsion, since the arguments for metrication are not nearly as strong as for decimalisation of the coinage, and half the world's capital equipment is measured in feet and inches? Will he confirm that the policy is not to compel people?
Mr. Benn: I assure my hon. Friend that compulsion is not part of the process. But I must tell him that the move to metrication has now acquired a great momentum, and the lack of compulsion

1171
does not mean that this is not a serious and probably rapidly developing change.
Sir E. Boyle: Will the Board keep in touch with the Schools Council, which must be concerned in this matter, and will it take evidence from those schools which have already had success in teaching the ideas of decimalisation and metrication?
Mr. Benn: There will be full consultation. But the educational system is bound to move fairly rapidly, because it would be very wasteful to teach both systems indefinitely.

SERVANTS OF THE HOUSE (MR. SPEAKER'S THANKS)
Mr. Speaker: I am sure that the House would wish me to pay tribute before we rise for the Recess to the servants of the House for their devoted work this Session. It has been a heavy Session, placing onerous burdens on the Clerks and Parliamentary draftsmen who have manned the many Committees and coped with thousands of Amendments to almost hundreds of Bills; on the OFFICIAL REPORTERS, who have had to report what must have been a record number of speeches in Committee and in the Chamber; and on the Clerks and printers who have had to prepare through the night massive Order Papers of almost gargantuan size.
I note that today's Order Paper has reached over 9,000 pages and that the Notice Paper of Amendments over 12,000 pages. All this has had to be sifted, prepared and printed in addition to HANSARD, and almost entirely without error. Therefore, on behalf of hon. Members, I say a special word of thanks to the printers.
The same high praise is due to the staff of the Serjeant at Arms, the police, the Library, the kitchen staff and all who serve and guard us in carrying out our duties. But for their ungrudging service the House could not function efficiently.
1172
May I end by expressing, on behalf of the House, warm thanks to Sir Barnett Cocks and all at the Table for their constant, patient and wise advice, which has been at the disposal of every hon. and right hon. Member.
Hon. Members: Hear, hear.
Sir Harmar Nicholls: On a point of order. I wonder whether we could add to that list Mr. Speaker, who has been at the centre of all these strains.
Mr. Speaker: That would be out of order, I think.
I know that many hon. Members wish to speak on the subjects down for debate today. We are not on the Consolidated Fund Bill. The debates have been chosen and timed. I gave the first debate one and a half hours, because I imagined that, as usual, something would happen between 11 and 12 o'clock. I am prepared now to compromise and to let the first debate run until 12.45, but it must stop then. I am afraid that it will be impossible to allow all hon. Members who will seek to catch my eye to speak in this debate.

PARLIAMENTARY PROCEEDINGS (PUBLICATION)
Lords Message [24th July]communicating the Resolution, That it is desirable that a Joint Committee of both Houses be appointed to consider and report whether any, and, if so, what changes in the law of defamation and of Parliamentary Privilege are desirable in relation to the publication of the proceedings in Parliament,to be considered forthwith.—[Mr. Harper.]
Lords Message considered accordingly.
Resolved,
That this House doth concur with the Lords in the said Resolution.—[Mr. Harper.]
Message to the Lords to acquaint them therewith.
ADJOURNMENT
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Harper.]

NORTH ATLANTIC FREE TRADE AREA
11.44 a.m.
Mr. Hugh Fraser: As I am on my feet by right, may I, on behalf of the House, express our deepest thanks to you, Mr. Speaker, for the way in which you have conducted this very difficult Session of Parliament and to wish you a very happy Recess. [HON. MEMBERS: "Hear, hear."]
I speak on behalf of nearly 100 hon. Members from all parties who, on 6th May, tabled a Motion which proposed that, in view of the position of the Common Market negotiations,
"a feasibility study of an open-ended Atlantic Free Trade Area initially comprising the United Kingdom, the European Free Trade Association, Canada and the United States"
be set up. Nothing which has happened since 6th May has reduced the urgency of this request. A few hon. Members may have had time to read the article by Sir Con O'Neill in The Times this morning. The cleverer a man is, the more danger there is of his being intellectually dishonest. If N.A.F.T.A. is against the provisions of G.A.T.T., how much more so was E.F.T.A., in which the Foreign Office baronet was one of the prime movers? The events which have taken place since 6th May, the proximity of the American general election, the setting up in America of a study into new lines of business and American trade direction after the election, the various crises which we have had, and the danger of a turndown in world trade adds urgency to our request that a feasibility study into this matter should be made.
Why do the Government refuse to consider another option? The hon. Member for Faversham (Mr. Boston) and myself are not asking the Government to withdraw our application to join the Common Market. We believe that every option should be left open to this country in the problems which face it today. All that we are asking the Government to do is to show prudence and some economic and political prescience in this matter. But are: the Government showing either? Surely the most superficial study of N.A.F.T.A., even the one taken by Sir Con O'Neill, would show that the economic benefits to this country would be very considerable indeed. I will not repeat
1174
the remarkable speeches made by the right hon. Member for Battersea, North (Mr. Jay) and my hon. Friend the Member for Banbury (Mr. Marten) in our last debate. I wish to talk about the political considerations involved.
What are the reasons why the Government will not undertake a feasibility study? Why will they not allow British ambassadors abroad to talk to the business men and politicians who approach them, as I know they have done, in E.F.T.A., the United States and Canada, asking what are the possibilities of such a study? Why is there this glassy-eyed conspiracy of silence and inaction on behalf of right hon. Members opposite, especially the Prime Minister?
I believe that the Government's reasons are political. They believe that the United States, Canadian and E.F.T.A. Governments might be adverse. But how can they be sure if no consultation has taken place? I am informed by several ambassadors that the dictate issued by Whitehall is not to discuss the subject at all. This is the height of absurdity. Can it be that the Government are afraid of a rebuff? The Government and the Opposition should be pretty happy about rebuffs. Like Job they want to sharpen their potsherds for a possible rebuff. There is not much more that they can do.
Or are they afraid of offending the Europeans by making the suggestion that we should consider other possibilities at this stage? The imagination boggles at the sort of humiliations which they are prepared to see heaped on this country. I quite see that there would be no approach from the United States, E.F.T.A. or Canada while the Government are not prepared to lift a finger. But at this time, towards the end of 1968, it is nothing short of crazy for a Government policy to be based on one of growing improbability, namely, the growing improbability of our getting into Europe. I say that politically and economically. And further, are not events now by-passing the European Economic Community?
Turning to the question of getting in on political grounds, to use a gruesome analogy with heart transplant operations, for all the flowers, for all the whispered thoughts in the nursing home, for all the gentle holding of hands by the lesser European Powers, it is absolutely clear

1175
that for us to get a European transplant is simply not on if it means breaking up the vitals of the Franco-German entente. It is not a question of the veto of the General. It is a veto which flows inevitably from the position of France and Germany today. It is a veto clinical, simple and absolute.
If we turn to the economic side, I am convinced that since devaluation and as a result of the position of our balance of payments, neither is Europe prepared to face our competitive position nor are we able to pay the price of entrance. It is ridiculous to suggest to the country that we can afford to pay the ticket of agricultural entry at this stage. We should be going back to the Corn Laws. It would mean a worse position for our people, because of the burden of the balance of payments, since Peel was thrown out by the Conservative Party. If it is the view of some of my hon. Friends that we want to get back to Peel in the 1970s, they want another think.
We want for a moment to think about the problems that face us in the 1970s. I beg the House, and especially the Conservative Party, to see the world in the perspective of the 1970s rather than that of the 1950s when the Treaty of Rome was in creation. Looking ahead, I believe that the prime problem of the coming decade must be the further freeing of world trade. The development of backward economic areas by trade and the reconciliation through trade of the Western and Eastern worlds is essentially in Britain's interest.
This, I believe, is a grand strategy worthy of a great political party—a policy of tariff reform downwards for our and other industrial goods and to our and their mutual benefit, a policy not of the flag following trade but of hope being brought by trade to millions, a free market economy on a world scale with all the advantages of a division of labour and free movement of persons and capital, a policy for world growth. Without that, let me remind right hon. Gentlemen opposite, there can be no local economic miracle.
In such a perspective, what part has our membership of E.E.C. to play? Let there be between us military, technical and financial joint programmes, but in
1176
this scheme what part has E.E.C. itself to play—this fairly rich men's club? Is it not, I suggest, the possibility of something which by its inward-lookingness would or could become a road block to world progress? Is it not possible that events are by-passing the world value of this organisation? If we look to the east we look to many countries where this federal idea is on the decline. We see what Mr. Trudeau has been advocating in Canada. We see what is happening in Africa. We see what is happening in the Soviet Union. The powers of these central organisations have not proved as successful as many had intended, especially if they are inward-looking.
I believe that to pursue our entry into Europe is not now to pursue the empyrean, but, in the immortal words of my right hon. Friend the Member for Kinross and West Perthshire (Sir Alec Douglas-Home), to pursue a politically dead duck. As the season for party conferences approaches, however much still life there may be upon their platforms the last thing one wants on a platform is a dead duck, especially if it has been dead for several years, and especially if it has been suffering from a continuous process of most unsporting overkill every time it has been exposed to the General. For the main British political parties, to continue to pay lip service to a long-dead duck is not just absurd but becoming idolatrous. Burial is the only service suitable. Let the leaderships bury the bird or the bird will bury the leaderships.
To those who are opposed to my argument, to those who say that the E.E.C. is a dead duck and that the concept of N.A.F.T.A. is an embryo destined to be still-born, my answer is simple—that so long as Britain's main political parties maintain that their joining of a restrictive trading area is their only objective of economic policy, it is unlikely that America, E.F.T.A. or Canada will lift a finger to help.
Therefore, precisely for these reasons we believe that, without commitment, Her Majesty's Government should initiate unofficial talks and studies of feasibility. If that be without commitment, we must be totally committed to the expansion of world trade and—this is important—to the concept of N.A.F.T.A., an instrument which can

1177
push forward the ideas of another round of the Kennedy manifestations. Of course, this cannot be done on the same scale as before. There must be a spearhead, and that is precisely where the importance of N.A.F.T.A. lies.
But, above all else, we believe that the idea of N.A.F.T.A. would be a sign and earnest of the world's intention, decision and power not to turn it into rival trading blocs, not to set up more and more non-tariff barriers but to regulate its trading relationship. It is only by doing this that the West can put its affairs to rights.
We are not asking much of the Government today. We ask them simply to set up this feasibility study, but we ask them to act now.
11.56 a.m.
Mr. Terence Boston: From this side of the House, Mr. Speaker, I should like to join in the thanks expressed to you for your work during the Session.
Like the right hon. Member for Stafford and Stone (Mr. Hugh Fraser) I greatly appreciate the chance to debate this subject. The right hon. Gentleman has performed a service by introducing the first debate in the House devoted to this subject. I join the right hon. Gentleman in the tributes to the others who have been active in this sphere, particularly my right hon. Friend the Member for Battersea, North (Mr. Jay) and my hon. Friend the Member for Manchester, Wythenshawe (Mr. Alfred Morris), the right hon. Member for Thirsk and Mal-ton (Mr. Turton) and the right hon. and learned Member for Hertfordshire, South-West (Sir D. Walker-Smith).
I am not yet, I confess, among the out and out supporters of the proposal itself, but I seek, like the right hon. Member for Stafford and Stone, to make out a prima facie case for a thorough and searching inquiry into its feasibility. This is important because negotiations on Britain's entry in the Common Market are at a standstill and also because there appears to be no early chance of their success. This has been given added point by the overwhelming Gaulliste victory in the French elections and by the appointment of M. Couve de Murville as the French Prime Minister. This suggests that Gaulliste views could well prevail
1178
even after the General's departure from office. So we should be failing in our duty if we did not now set about the job of exploring the alternatives anew.
I feel that Britain and her partners are in a sense again at the crossroads. There is evidence of a history of missed opportunities in the international sphere. We cannot afford to go on missing opportunities in future and then, when it is too late, try to retrace our steps—because that, to some extent, is the history of our attempts to get into Europe already.
First, what are the alternatives? I shall make only a brief passing reference to all but one of these. I start, as the right hon. Gentleman did, from the basic assumption that we want freer trade. The first alternative is another Kennedy Round of negotiations in the G.A.T.T., and most people would not feel that there is a strong likelihood of much success with that in the early future.
The second is concentration on Commonwealth trade. This is a doubtful starter, at least on its own, not because of lack of sentiment but because there is little support in the Commonwealth for trade policies akin to the Ottawa Agreements of 1932. Third, associate membership of the E.E.C. There is little enthusiasm for this, especially with no guarantee of full membership later and because Britain would have no say in the policy decisions of the Council of Ministers. Fourth, we could continue as we are, and that is a serious if uninspiring alternative. Fifth, there is the technological community, but that is not an exclusive alternative and one hopes that progress will be made with it anyway.
Finally, there is the proposal we are discussing and because this is the first debate on it I want to go into one or two further details. It has already been receiving considerable study in this country and elsewhere and I want to quote one or two things from some detailed preliminary work done for the Committee of the Atlantic Trade Study in an excellent booklet called, "The Free Trade Area Option—Opportunity for Britain". What is involved? The basic proposal is for a treaty of free trade and economic co-operation between, initially, Great Britain, her E.F.T.A. partners, the United States and Canada. This would be for an open-ended agreement allowing any industrial nation or regional trade

1179
group to join which was willing to adhere to the system. This would be developed, therefore, by systematic negotiations rather than by the creation of a supranational authority.
The other basic principle is that gradually, phasing it perhaps over 10 to 15 years, we would bring to an end internal tariffs and other discriminatory restrictions on the movement of industrial products, capital goods, raw materials, investment capital and so on. But it would not include, at this stage at least, agricultural products and it would not require members to adopt a common external tariff.
I come at once to the attractions as I see them for Britain. First, there would be no common external tariff. Each member nation would be free to continue its special preferences with non-members. The area would not be a customs union nor an economic community. For example, there would be no difficulty in our making special arrangements for, say, New Zealand.
Secondly, there would be special facilities for developing countries initially, as they would find it disadvantageous to join at the start. The idea is that the developed nations would extend free access to their markets without expecting full reciprocity until industrial progress in the developing countries made it possible for them to reduce their own trade barriers. Third, there would be no surrender of national sovereignty, as under the E.E.C., so this would have its obvious of Common Market membership, attractions for those who fear this aspect
Fourth, agricultural products would not be included. This is again an advantage compared with the E.E.C. to some minds, as the E.E.C. would involve higher food prices and a rise in the cost of living, at least initially. The idea is that the Atlantic free trade area would be restricted, at least in the first place, to largely industrial commodities and basic materials.
Fifth, an arrangement of this kind need not include movement of labour—another problem on which some people have misgivings about the E.E.C. Finally, the hope is that other nations would join in at the start or later, particularly Australia and New Zealand, and it would also be possible for the E.E.C. itself to
1180
join. There are obviously other considerations as well but I think that these are the main ones.
I want to turn now to the effects on Britain and the substantial benefits for our balance of trade. Here again, I draw on the study I have referred to, particularly for figures showing what would happen to our trade balance with the United States and Canada as the first examples. The direct effect of an Atlantic free trade area on member countries would be clearly trade creation from removing tariffs over a period. It is clear that Britain's balance of trade in manufactures would improve substantially, provided, of course, our export prices could be held down. But that is vital whatever we do or whatever group we enter.
Compared with 1965, under the A.F.T.A. system, the United Kingdom would be able to export 243 million dollars-worth more of manufactured goods to the United States but in return would increase imports in manufactures by only 186 million dollars. So our trade balance would improve by a significant 30 per cent. I shall not go into the main products. In trade with Canada, again compared with 1965, our exports would go up by 49 million U.S. dollars— slightly more than a 10 per cent. increase.
That is under the heading of trade creation but there are also substantial benefits to be derived from trade diversion, in which, for instance, we would win trade away from the E.E.C. and other countries. If we compare Britain's entry into an Atlantic free trade area with her entry into the E.E.C, and take into account both the trade created and the trade diverted, we find that the net increase in Britain's trade would be in the Atlantic area some 665 million dollars and in the E.E.C. 221 million dollars.
There is a further important point. These calculations were published last November, so they do not take devaluation into account. Devaluation would have resulted in further benefits, of course. All this is without going into further benefits that would follow from membership of an Atlantic free trade area—through, for example, an attack on non-tariff barriers, such as quantitative restrictions, state trading, Government buying, arbitrary customs classifications

1181
and so on—Scotch whisky would benefit —and through other aspects such as the so-called dynamic effects of an association, which mean economies of scale and effects on rates of growth and so on.
On the other side, it is said by some that an arrangement of this kind would mean domination by the United States. But the whole point of the arrangement is that, like E.F.T.A., it would not involve surrendering sovereignty and there is no evidence, as my right hon. Friend the Member for Battersea, North has pointed out, that Switzerland or Sweden, say, have been dominated by Britain inside E.F.T.A. Moreover, if there were the slightest sign of U.S. investment in Britain reaching dangerous proportions, it would not be incompatible with the free trade concept to control this flow. By far the bigger danger is American isolationism, and a failure to show some enthusiasm for developing links with the United States would encourage those in America who actually want her to become more isolationist and more protectionist.
Moreover, there are signs that Eastern European countries would be much more inclined to see an Atlantic free trade area developing than to see Britain in the E.E.C. This is of interest to those of us who want closer links not only with Western Europe but with Eastern Europe as well and, significantly, Czechoslovakia is among those countries which show some interest in this as an idea.
There are those who say that the United States would have to show its interest in an Atlantic free trade area before it would be worth our while to initiate moves. But the Joint Economic Committee of Congress has started reviewing this concept and Mr. William Roth, the American chief Kennedy Round negotiator, was appointed by President Johnson last year to head a committtee on future policy. He said last February that the American Government were studying an Atlantic Free Trade Area plan.
Of course no one need suppose that joining any group would solve our difficulties overnight, and certainly the United State is not going to drop everything to help Britain over her problems, because she has plenty of her own. But, as I have learnt from an extensive five-week tour of the United States recently, there is
1182
not only enormous good will among its people generally but is tremendous scope for developing our trade with the United States.
Much of what I have said could be argued about, no doubt, but if there is scope for argument that is all the more proof that there is scope for thorough exploration. I hope that the Government will decide on a full study and will start soundings with the United States and other nations and that we could have a Green Paper initially.
In our debate on the Common Market last year, I spoke in favour of Britain's entry, but I also said that we could not afford to go through the upheaval of applying every five years. What would be unforgivable now, would be for us not at least to satisfy ourselves about the options now open by examining them thoroughly, and this is what I hope the House and the Government will do.
Mr. Speaker: I would point out to hon. Members that the Front Bench spokesman will intervene at 23 minutes past twelve, which is in 13 minutes' time.
12.10 p.m.
Mr. R. H. Turton: My right hon. Friend the Member for Stafford and Stone (Mr. Hugh Fraser) and the hon. Member for Faversham (Mr. Boston) have put the case so clearly and cogently that I need concentrate on only one aspect. I have been feeling for many months that, whatever the advantages or disadvantages of Britain being placed under the control of a European Commission, the posture of a rejected suppliant in the ante-chamber of Brussels is damaging this nation economically, spiritually and morally. That is the main point.
My views on this subject represent, I know, minority views in my party and minority views in the House, but not, I believe, in the nation. But I do not believe that there is any right hon. or hon. Member in this House who can honestly say that he expects, in the lifetime of this Parliament, that France will allow the negotiations to begin.
What will happen in the meantime? While we allow our application to lie on the Table, our relations with E.F.T.A., the Commonwealth and the United States

1183
continue slowly to deteriorate. Time does not stand still either in politics or in economics. Therefore, our stationary posture is damaging the whole of our sense of purpose as a nation. That sense of purpose is becoming atrophied.
Let us admit that there are limits to our power today, but let us never admit that our influence is subjected to equal limits. We should take Mr. Dean Acheson's advice and look at Britain's rôle today. I believe that our rôle in the world must be to bring together the ageing European civilisation and the young developing civilisation in other continents, to narrow the gap between the rich industrial countries and the poor developing countries, and to secure, by our defence policies, the arteries of our trade, both visible and invisible.
It so happens that this is the area of the trade of this great industrial nation. That is why I believe that now is the moment to work out means of extending the European free trade area to the countries of the Commonwealth and to other countries, such as the United States, which may wish to join. The fulfilment of this concept will take time. It is long term. The details must at the moment be imprecise. However, I want the country and the Government to realise that in Canada, Australia, the United States and Scandinavia there are men who are looking for this.
I would remind the House of what Sir Robert Menzies said only last year:
"If, as appears to be the case, the consideration of the British application is indefinitely postponed, what is the most important task for the future? It seems to me that, in the period ahead, serious consultations should be put in hand by Britain, the Commonwealth, and the United States, to determine whether special economic arrangements cannot be established."
That is why we are pressing the Government for a feasibility study to be started now, just as the Americans are doing. What is the Government's reply? They say that they conducted one before they changed their mind to apply for entry into the Common Market. If that is so, will they publish it so that we can read it? Or do they not want to publish the study because it may appear to damage their suppliant posture in the antechamber and may be misconstrued by those on the other side of the closed door? Or is it perhaps that they are
1184
frightened that other parties in the House may deride them and claim that they are being guilty of another change of policy?
This matter is something tar above party politics. It is an issue that affects the whole nation. I believe that the men who do not undertake such a feasibility study will be condemned by the nation for subjecting it to purposeless stagnation.
12.15 p.m.
Mr. Ivor Richard: I am obliged for the opportunity to take part in the debate. I am more than obliged to the right hon. Member for Thirsk and Malton (Mr. Turton) for taking such a short time.
I would not wish anybody reading this debate in HANSARD to assume that the House of Commons had suddenly become wholly united and that all speakers in the debate were in favour of some kind of alternative association to the European Economic Community. I regard N.A.F.T.A. at best as an irrelevance and at worst as a diversion. It would be asking too much to hope to convince everybody in this Chamber at the moment about those sentiments, but perhaps I may convince our Front Bench spokesman.
I was more than interested when the right hon. Member for Stafford and Stone (Mr. Hugh Fraser) said that he saw N.A.F.T.A. as another option. I do not see N.A.F.T.A. as an option to the European Economic Community. One is not comparing like with like. N.A.F.T.A., even on the most optimistic description we have had today and taking it as if it were established and in existence, is nothing more than a loose non-institutional, non-existent, undefined customs-free economic association. Moreover, it is an association which is capable of the uttermost flexibility. It starts off as the North Atlantic Free Trade Association. Someone mentions Japan, so N.A.F.T.A. becomes P.A.F.T.A., and we have not a N.A.F.T.A. but a P.A.F.T.A. type of association. But one should no longer use the words N.A.F.T.A. and P.A.F.T.A. either together or in association, the one with the other; one should now start talking of something being called M.U.F.T.A., a multilateral free trade association. The proponents of

1185
N.A.F.T.A. should make up their minds whether they are proposing machinery for the greater liberalisation of world trade or something, which they should propose in a sensible coherent way, as a real alternative to the European Economic Community. If it is the first, by all means let us examine it, but let us examine it in conjunction with those nations with whom we have cast in our lot, namely, the European Economic Community. If the proposal is for Britain to enter into discussions with the E.E.C. so that we might ascertain whether we could have greater liberalisation of trade across the Atlantic, I, and others on this side, and I hope on the other side, would be prepared to accept it. But I fancy that is not precisely what is in the minds of those right hon. and hon. Gentlemen who are proposing this type of association. It seems that we are being asked to examine something, first, which is clearly non-existent, and, secondly, which is so ill-defined as almost to defy analysis, let alone a detailed examination.
On the other hand, we have the European Economic Community. That at least exists. It is an established organisation, it is a developing organisation, and it has centralised machinery for economic decision making. It is not solely confined to a customs union. It has enormous political content. There is an organisation which is a step towards the greater unification of our continent —and, after all, Europe is our continent. I see no way in which Europe will be united other than on the basis of extension of the European Economic Community. Therefore, those who propose N.A.F.T.A.—and looking around this morning I see a number who would propose it—would not be in favour of a greater degree of unity in Europe.
If the arguments in favour of N.A.F.T.A. are that we do not believe in European unity, and are proposing this as an alternative then at least I understand the argument, although I utterly and totally reject it. One cannot, at one and the same time, approbate and reprobate Europeanism. One cannot go to the Continent of Europe and say, as we have done, that we are part of this continent and want to play a greater part in its affairs, we want a greater influence over what goes on, and in the
1186
affairs most directly affecting us and on the other hand turn round and say that we do not think that the E.E.C. is good for us, but would like to look at an Anglo-Saxon type of alternative, the effect of which in Europe, would only be to weaken the credibility of our expressed Europeanism.
This is the greatest danger in this proposal. There are those who say that they want to weaken it and, while I appreciate that point of view, I disagree with it. It is important to emphasise that an attempt by Britain, even of the most elementary and sketchy type, to make overtures towards the United States, towards P.A.F.T.A. or M.U.F.T.A. would only and could only be construed in Europe as a step away from Europe by Britain and a change of direction in the moves towards Europe which this country has been making. As the whole history of Europe since the end of the last war has been one in which national boundaries have disappeared and the nations in Europe have been trying to come together, this step by us would tend, not to hasten unity, but to delay it and therefore I am against the proposal.
12.22 p.m.
Mr. Richard Wood: I apologise for getting in the way of hon. and right hon. Gentlemen who would no doubt dearly like to continue the debate. I welcome the opportunity of discussing such an important matter and have listened carefully to what my right hon. Friend the Member for Stafford and Stone (Mr. Hugh Fraser) said about dead and embryo ducks, but I still believe that a large majority of hon. Members are convinced that our future lies in some form of close association with Europe. I none the less share the view of the right hon. Member for Thirsk and Malton (Mr. Turton) that there are no prizes to be gained through a policy of static inaction.
We all agree that we must move forward. It is important that the opportunities open to us should be examined carefully, however strong our convictions, which I share, that any course to which we give serious consideration should be compatible with eventual membership of an enlarged Community, perhaps bridging the Atlantic Ocean as well as the narrow strip of the English Channel.

1187
What we cannot do is to take action or initiate examination—and I agree with the hon. Member for Barons Court (Mr. Richard) about this—which might turn us away from a future in Europe, for not only in E.F.T.A., which many supporters would conclude should be included in such a grouping, but also in the Community, we have many good friends, passionately anxious that Britain should play an important part in Europe. Most of us cannot contemplate the idea of abandoning them. As the hon. Member for Faversham (Mr. Boston) said, a considerable number of valuable studies are taking place many of which are inevitably based on assumptions which may be correct but which may be proved wrong.
The main subject of the debate is a concept of this kind, and it is clear that our study of it must be based on assumptions, because it is a concept and not a fact. This underlines the folly of nailing our colours firmly to the ghostly mast of the Atlantic Free Trade Area or, on the other extreme, of assuming that the concept can never become a reality.
I understand that a number of hon. Members see the Atlantic Free Trade Area as an alternative to the E.E.C. Clearly it cannot be such an alternative unless it first becomes a practical possibility. If that happens it may well begin to appear to a great many of us as a step beyond the E.E.C, rather than as an alternative to it. All of us, whatever our views of existing arrangements in Europe or possible groupings across the Atlantic, are wholeheartedly in favour of any steps to liberalise trade both within Europe and with North America and beyond. The essential first step is the successful implementation of the Kennedy Round of tariff reductions.
Other objectives will naturally follow. They may be difficult to realise but they are clear. First, the complete elimination of all tariffs between the Kennedy Round countries and, ultimately, the removal of all non-tariff barriers to free trade. If we and other nations were seriously committed to objectives of this kind, it could be fairly claimed that we were already in spirit, and desired to be in practice, associated in an Atlantic free trade area.
1188
My contention is that while these manifold studies of the Atlantic free trade area make progress and should be encouraged to make further progress, studies upon which we shall eventually be required to pass a political judgment, we can simultaneously determine to give our support to all sensible steps towards lowering trade barriers, in the conviction that it is in this organic way that the concept of a free trade area is likely to grow into reality.
If this were to happen, it might still be possible for us one day to look back on the rejection of Britain by Europe in the last decade as a blessing in disguise because it would, conceivably, eventually have made possible an economic grouping more extensive than Europe, including Europe but with other nations beyond, and even more important than the existing Community.
12.28 p.m.
The Under-Secretary of State for Foreign Affairs (Mr. Maurice Foley): We have had a valuable debate. It is useful that the House should turn its attention repeatedly to the question of international trading arrangements. We should always be seeking to find the best means of meeting Britain's interests and it is in this spirit that I approach the subject. The idea of N.A.F.T.A. is not new and has a long history. I can recall in the mid-1950s discussing this with Senator Javits, in the context of N.A.T.O. being something other than a military alliance. The dialogue has continued ever since.
Mr. Turton: Will the hon. Gentleman remind Sir Con O'Neill of that fact?
Mr. Foley: He may well read our debates this morning. I want to begin with the more recent developments in this area particularly the Montebello conference in 1956, organised by the Private Planning Association of Canada. At that time the principal sponsors appeared to be business interests in pulp, paper and aluminium who were anxious to achieve a North Atlantic free trade area rather than a new, wider grouping. There were few references to the policy problems that may confront the United Kingdom if it were to participate in such arrangements. Stemming from that conference, Canadian Ministers, particularly Mr. Lester Pearson, and representatives of the

1189
United States Government, displayed very little interest in its work or findings, believing that priority should be given to fostering a multilateral approach to the liberalisation of trade.
There is still no evidence that there has beer, any change of mind by the Canadian, or United States Governments. It remains a major factor in considering the relevance of an Atlantic free trade area than there is no evidence of Governmental support for it in either Washington or Ottawa.
Mr, Douglas Jay: In that case, can my hon. Friend say whether the present Government have asked the Administrations in either Washington or Ottawa what their altitude is?
Mr. Foley: My right hon. Friend's intervention was a little premature. As I go on I shall be developing that point further.
As the right hon. Members for Bridlington (Mr. Wood) and Stafford and Stone (Mr. Hugh Fraser) said, we want to see tariffs on industrial goods reduced as widely and as much as possible. This is what we have worked for, with considerable success, in the Kennedy Round. When the Kennedy Round reductions agreed last year become fully effective in 1972, tariffs on trade in industrial goods between nearly 50 countries will be reduced by an average of well over 30 per cent. This was achieved without any N.A.F.T.A. It was not needed. Negotiations are going on through the normal channels in G.A.T.T. towards the further reduction of barriers to trade on a worldwide basis. After the Kennedy Round the importance of tariffs as barriers to trade is relatively much smaller as compared with other forms of restriction, such as quotas and tax structure.
Therefore, if N.A.F.T.A. means something more than further efforts to free trade on a world-wide basis, we must consider it in relation to our application for membership of the European Economic Community. This was rightly said this morning in a number of speeches. Clearly, in this context, the French veto which prevented the opening of negotiations cannot be brushed aside, for it has grave consequences for Europe as a whole. But we do not believe, and the Governments of the six member countries do not
1190
believe, that it can be the last word on the subject of the enlargement of the Community. Our application remains on the agenda of the Council of Ministers.
In the meantime, we and other European countries must look for ways to prevent a wider split developing in Europe. It is not true to say that everything is static, that nothing has happened, that there are no discussions going on. The Memorandum of the Benelux Governments last January made certain proposals for joint action, which we support. The Council of Ministers is also examining the question of interim trade arrangements. We have said that we shall look at any proposal of this kind if it is made to us by the Community as a whole, provided there is a clear link with our objective of full membership of the Community.
Members have raised the question of our application and its implications. In May last year when the House gave its overwhelming endorsement to the Government's decision to apply for membership it had two crucial considerations in mind. First, there was the wish for an economic and industrial partnership with the countries of Western Europe, and, second, there was the wish for closer co-operation over the whole range of international affairs. We hoped to provide fresh opportunities for the practical application of modern technology and for obtaining the advantages of industrial concentration.
Mr. Roland Moyle: Is my hon. Friend aware that unless the Government make rapid progress in the direction of joining the Common Market the British computer industry, for instance, is far more likely to be linked with the American firm of R.C.A., with which it is negotiating, than any European firm?
Mr. Foley: This is one of the instances where our proposal to develop a European technological community is a demonstration that things are not static, that we are aware of these implications.
Similarly, while emphasising the continuing importance of our membership of the Atlantic Alliance, we see our membership of the E.E.C. as providing a means by which a united Europe can better make its voice heard in the world. In this respect, our decisions to apply for membership of the E.E.C. and to

1191
reduce our commitments east of Suez were, taken together, a significant turning point in British foreign policy.
When we look back to the debate in the House and in the country at large last year, we can see that while we were alive to the great economic possibilities which membership of the European Communities would open it was the political considerations which were decisive for us. We recognised and avowed that we were aiming at something far more than material prosperity, that what we were seeking was a greater political purpose for Western Europe and for Britain as a part of it.
These considerations apply equally today, and I ask those who agree broadly with them to consider how far an Atlantic free trade area would satisfy such needs. Clearly there are certain attractions in a form of organisation, if it could be devised, that would strengthen our existing ties with the United States and with one or more of the developed countries of the Commonwealth. But we should have to be very careful of the possible danger that it might provoke the kind of split between the countries of Western Europe and North America which it is one of the main aims of our policy to prevent. It is hard to believe that the E.E.C. at present would have any interest in joining a N.A.F.T.A. Such a grouping would suggest to it that the United Kingdom had irrevocably committed itself to its aims that might be in conflict with its interests. It would be the so-called special relationship with the United States all over again.
As has been evident in our brief debate—
Sir Harmar Nicholls rose—
Mr. Foley: I am very sorry. I cannot give way, for I have many more points to answer, and I must finish in about 10 minutes.
Sir Derek Walker-Smith rose—
Mr. Speaker: Order. The hon. Gentleman is not giving way.
Sir D. Walker-Smith: Would the hon. Gentleman have the courtesy—
Mr. Speaker: Order. It is not in order even for a right hon. and learned Gentleman to intervene except with leave of the Member who is speaking.
Sir D. Walker-Smith: With great respect, I am giving the Minister the opportunity of second thoughts.
Mr. Speaker: Order. The right hon. and learned Gentleman must not intervene if the hon. Member does not give way.
Mr. Foley: I am coming to the point raised by a number of Members.
N.A.F.T.A. means different things to different people, as has been evidenced in our debate and was evident at the Conference at Church House earlier this month. There are those who have advocated a nucleus of the United States, Canada and the United Kingdom. Some would include the E.F.T.A. countries; some would include Japan; some would like to see Australia and New Zealand included. Others maintain that it should be a sufficiently open-ended arrangement to accommodate the E.E.C. as abloc. Some see it as confined to an industrial free trade area. Others would include agricultural arrangements, and it is difficult to see how agriculture could be excluded from this wide concept.
As a result, practically any judgment made about the likely consequences of N.A.F.T.A. depends on the basic assumptions made, and these vary widely. The pro-N.A.F.T.A. study published by the Maxwell Stamp Associates described its conclusions as "estimates on the basis of other estimates". Much depends on what assumptions are made about the membership and nature of a new grouping. If one considers trying to determine either a geographical area for N.A.F.T.A. or to establish the principles on which it should be founded, the assumptions which emerge are precisely the kind of thing on which it is impossible to be firm, complete and absolute, as was my hon. Friend the Member for Faversham (Mr. Boston) with the trade figures he quoted as to what would happen in the next few years between ourselves and Canada. It is equally possible to argue that the assumptions of these estimates are too static and unrealistic but that if different assumptions were made the results would appear neutral or even harmful.

1193
I come to the question of trying to quantify the arguments put forward in the terms of a consensus view about membership. The scope and scale of the factors which have to be assessed is such and their uncertainty so great that no one could rely on such estimates over the period on which such a long-term proposal as N.A.F.T.A. would have to be judged. We have no reason to suppose that the United States Administration have any interest in N.A.F.T.A.
Sir D. Walker-Smith: Have you asked them?
Mr. Foley: During the period leading to our application to join the E.E.C., N.A.F.T.A. was one of the options which was open and which we studied. It is not true to say that the information available to us then has been hidden or that the House or country has been misled. In our three days' debate on this subject just over a year ago, all this information was given.
Mr. Hugh Fraser: Publish the study.
Mr. Foley: The facts and information prepared by the Government were given and debated in the House over three years ago.
Sir D. Walker-Smith: Would the hon. Gentleman give way now?
Mr. Foley: I have not the time.
As my right hon. Friend stated last week, it is not true to say that all the studies have shown that such an arrangement would bring considerable economic advantages to this country. Nothing has occurred since then to alter our conclusion that the alternatives, such as N.A.F.T.A. or a policy of go-it-alone, are less attractive to us than membership of the E.E.C., which remains our prime aim.
Mr. Jay: I have listened to my hon. Friend for 10 minutes. Will he now answer my question: have the Government approached the Canadian and American Governments about this matter? If they have not, will they now do so?
Mr. Foley: It is rather strange that my right hon. Friend should pose that question. He was a member of the Government when they were discussing the options which were open—N.A.F.T.A. was one of them—and he will be aware,
1194
if my memory is not fragile, that there was continuous dialogue and discussion with members of the Commonwealth, the United States, Canada, our E.F.T.A. partners and other European countries prior to our decision—
Mr. Jay rose—
Mr. Speaker: Order. I remind the House that this debate must finish at quarter to one.
Mr. Jay: Have the Government made any approaches since the veto by General de Gaulle on our application to join the E.E.C.?
Mr. Foley: Certainly not. The answer was given clearly on many occasions in the House. We did our homework, we looked at the options, N.A.F.T.A. was one of them, and we decided to go for full membership of the E.E.C. on economic and political grounds. There are no arguments in favour of reversing that decision. The matter will be kept constantly under review. I believe that our policy is right.
Sir Harmar Nicholls: Is the hon. Gentleman aware of what he has said— that if we dare to consider any alternative Europe would look upon it as an unfriendly act? As we have been rebuffed on three occasions, does he suggest for a minute that this country has no power or right to consider alternatives because of fear of that possible reaction?
Mr. Foley: The hon. Gentleman had better look closely at what I said. It was my hon. Friend who referred to credibility, not myself.
Mr. Speaker: May I make an observation to hon. Members who were not present earlier? This is not a Consolidated Fund Bill debate. A host of Members wish to speak in the following debate. Most of them will not be called. More Members will be called if speeches are brief. The next debate ends at 10 minutes past two.

SHIPPING AND SHIPBUILDING
12.45 p.m.
Mr. Frederick Willey: I wish to turn the House's attention to two of our basic, essential industries—shipping and shipbuilding.

1195
It is hard to discuss them in the short time at our disposal, but I realise the difficulties and I shall be brief.
In a way, the post-war history of both these industries reflects what has happened to Britain since the war. Dealing, first, with shipping, we have been able to maintain, and indeed increase, our mercantile fleet, but it has seriously lost ground in the world. Last year was a significant year because for the first time the British fleet ceased to be the largest in the world. Liberia now has the largest mercantile fleet in the world. Only 20 years ago, Liberia had a couple of ships and a fleet tonnage of 700. Twenty years ago, Norway had a fleet of 4 million tons. Now its fleet is over 18 million tons. Twenty years ago, Japan—and this is not without significance if we think what has happened in shipbuilding—had a fleet of 1 million tons and now has a fleet of 17 million tons.
Therefore, in the world, the British mercantile marine no longer has the dominant position which it had 20 years ago. Expressing this in percentages, whereas, before the war, the British fleet represented 28 per cent. of the world fleet, it now represents just over 12 per cent.
My interest in shipping is secondary. My primary interest has always been in shipbuilding. But the fate of shipbuilding depends upon shipping. We depend on shipping for our orders. When I put forward proposals for the shipbuilding industry in the mid-1950s, I suggested that a fact-finding inquiry should be made, not only into the shipbuilding industry, but into the shipping industry. Eventually, we had a fact-finding inquiry into shipbuilding and the Report and recommendations of the Geddes Committee. Everyone in the shipbuilding industry recognised the success of that inquiry.
I ask my hon. Friend the Parliamentary Secretary to consult the industry so that consideration might be given to holding such an inquiry into the shipping industry. I am not being doctrinaire. I know that the shipping industry is working on a very narrow margin of profitability. I readily acknowledge the importance of its recent increase in its contribution to the balance of payments. I recognise the special prob-
1196
lems of an international industry. Developing countries develop their own mercantile marine. I know of the steps taken by other countries in trade discrimination. These are the sort of problems which should be considered so that recommendations may be made about the industry as a whole.
There are other problems. We are developing highly sophisticated ships, which, we must recognise, demand smaller crews. There is the problem of our coastal shipping. We must sit up and take notice when we find that for years the Dutch and Germans have been able to take some of our coastal shipping trade from under our noses. I know that those in the industry have a very healthy regard for its independence, but today, the industry has the benefit of free depreciation and investment allowances and I ask those in the industry to accept such a suggestion and see whether we might get a development similar to that which has taken place in shipbuilding.
The post-war position in shipbuilding is worse than it is in shipping. We have been able to maintain a stable level of output in shipbuilding, remarkably stable if we think of the years before the war. But we have seriously lost ground to other countries. I remember that in 1947 we were building more than half the world's ships. During the last few years, the level has dropped to as low as 7½ per cent. I remember repeatedly calling attention in the House in the mid-1950s to what Sweden, France and Germany were doing, and, much more important, to what Japan was doing and how she had recovered from her first set-back. I remember then being told by Conservative Members how unrealistic I was about Germany and Japan. I called attention to the fact—and this would affect an inquiry into shipping— that for the first time we were then placing orders abroad for British shipping. I was told at the time that only 4 per cent of our shipping was being built abroad and that there was no cause for concern.
Things have turned out differently. Last year, when our yards achieved their finest export output since 1920, we were still a net importer of new shipping. Today, we have over 1 million tons

1197
under construction abroad for registration in the United Kingdom. If we look at the position of shipbuilding in the world as a whole we find that Japan is at the top of the table, and, not only that, but if we take the whole shipbuilding world's order book, we see that Japan has orders equal to the total of those of the next four countries in the table. Sweden is now determined to hold her second place. We have then got Germany. Fighting for fourth and fifth place—and I am glad to say we are moving up—are ourselves and France.
Now one cannot blame the Government for this. I am sure that the House would acknowledge that never before, I think, has so much been done for this industry. I mentioned the proposals I made in the mid-1950s. I then suggested, as I said, that we should have a fact-finding inquiry. We got the Geddes Committee appointed immediately by the Government and we got a very good Report from that Committee. I also suggested, secondly, that we should have a Reorganisation Commission. That is what we got in the Shipbuilding Industry Board, with its grants and loans.
I should like to make, by way of aside, two points. When I suggested a Reorganisation Committee I also suggested that there should be power to enforce a reorganisation scheme by regulations approved by Parliament. I think, retrospectively, that was right. I do not emphasise it too much, because I recognise the importance of independence and initiative in the industry, but I think that it was right that there should be some public responsibility for reorganisation of the industry.
However, I think that this is more important. I also suggested that such a Board should also deal with the problem of redundant capacity and see that suitable alternative work is provided for redundant manpower, and I think that that was right. I know that some of my hon. Friends are rightly concerned about workers who may be made redundant at the Furness shipyard, but I think that it would have been done better directly within the concern of the body responsible for reorganisation. I think, also, and I I know that many of my hon. Friends share this view, that we have to take more realistic steps about the question of providing alternative work for the men made
1198
redundant by reorganisation in the industry.
I turn briefly to the prospects of the industry as they appear today. The short-term prospects, I think, are very good indeed. They have considerably improved, and I think that we can say that the industry has been able to take full advantages of the opportunities given first by Suez and then by devaluation. There has been a remarkable improvement over the last quarter of last year and the first two quarters of this year. I think we can also say, while recognising this considerable recovery, that the action of the S.I.B. has been right and that the owners have been encouraged by the credit guarantees at the right time. We have got these home orders now being put into British yards.
Looking at the long-term prospects, while I would pay tribute to the work of Sir William Swallow and his Board, I do not think that we can be quite so confident. We can pay tribute to them for what they have done about the Upper and Lower Clyde, about the Tyne, and what they are doing on the Wear. Oddly enough, we have particular difficulties on the Wear, for we were pioneers in this field. In 1954, we got a considerable merger by the Sunderland Shipbuilding Company—the Doxford group. Now we are trying to get a merger for the whole river against the background of the substantial part of the industry which has been merged already. Outside that group we have only a couple of yards. I think that Sir William takes a realistic view, our credits were not held up, and the Board has agreed that it will consider the loan and grant proposals made by the Sunderland Shipbuilding Company in the context of the general interests of the Wear.
This is good progress. What concerns me is something rather less specific, less identifiable. The Geddes Report gave us three alternatives: the industry could decline, it could hold on, or it could grow. The Geddes Committee came down on the side of growth and the S.I.O. equally is on the side of growth. I want to define growth in terms of the Geddes Report. Growth is that within two to three years after reorganisation, the British shipbuilding industry should gain on the world market a share of 12½ per cent. or more.

1199
It is now enjoying 8 per cent. of the market. This is a considerable task. The Geddes Committee defined the capacity of the British yard and the output of British yards as round about 2¼ million tons per annum.
Now I am not convinced that the industry has yet accepted this target. We on the North-East Coast have been very disturbed at the threatened closure of the Furness yard and the fact that no merger would consider taking the yard. We have got to get the industry more firmly committed to a target of 2¼ million tons.
My second point is that in the Geddes Report there were seven points for early discussion. I want the Minister of State to say what progress has been made with the seven points. I shall mention only a couple, but they are very important. There is the question of manpower required by the industry. It is very important to get this defined because of the problem of alternative work following reorganisation as it is carried out. Without alternative work it is very difficult to carry out reorganisation and to carry it out we have to provide the necessary alternative work.
There is also the question of effective machinery for consultation at yard level. This is equally important. I would pay tribute to what the unions have done and I would pay tribute to what happened on the Tyne and we want progress likewise on the Wear.
The third point I would put is that we recognise that, following the reorganisation of the shipbuilding industry, we must consider marine engineering. We recognise that this is a much more complex and difficult problem. I should very much like my hon. Friend to say what progress is being made with this. I do not quarrel with Sir William for taking shipbuilding first, and then marine engineering. I agree that B.R.S.A. should be associated with this. I think it right and proper that it should do, but I would welcome anything my hon. Friend has to say about marine engineering and the progress which has been made towards reorganisation.
To conclude, I think that we can pay credit to the shipbuilding industry. It is providing good deliveries. It has taken
1200
advantage of the attractive credit facilities, and it is at present doing well enough on price. It is price that is really important, looking further ahead. It is price that will be absolutely crucial in the world market. Price turns ultimately on higher productivity and higher productivity turns on successful reorganisation of the yards—and successful reorganisation, I emphasise, that is carried out in the spirit of the Geddes Report.
Several Hon. Members rose—
Mr. Deputy Speaker (Mr. Sydney Irving): Order. I would remind the House that this debate must finish at ten minutes past two, and that if all hon. Members who wish to speak are to get in to the debate all hon. Members must be brief.
1.0 p.m.
Rear-Admiral Morgan Giles: I agree that shipping and ship building are extremely important for Britain, and that it is very appropriate that we should have this debate on the last day before the Summer Recess. This is a most exciting time for all seamen and engineers with all the prospects and the development in super tankers of which we read so much. This morning, however, I want to draw attention to another angle of shipping, and that is its protection.
It must never be forgotten that the world-wide protection of shipping has always been the principle rôle of our naval forces. There is no need for me to emphasise that without the safe and timely arrival of merchant ships in peace time and in war, the country would starve. There is no need for me to go into the history of the convoys, the Battle of the Atlantic, and so on, in the two great wars of this century. But what worries me now is that the policy of the Government seems to be to reduce our Armed Forces—
Mr. E. Shinwell: On a point of order, Mr. Deputy Speaker. This debate was arranged primarily and exclusively for the discussion of shipping and shipbuilding. The protection of British shipping does not enter into the debate this morning. Surely the hon. and gallant Gentleman the Member for Winchester (Rear Admiral Morgan Giles) has the common sense to understand that we in the North-East are

1201
concerned with a special problem. Will he not intervene in affairs that do not concern him?
Mr. Deputy Speaker: Order. The title of the debate is rather general, although I think that it would be in conformity with the practice of the House if it were confined to one aspect of the subject.
Rear-Admiral Morgan Giles: I quite understand the point, Mr. Deputy Speaker, but there is no point in having ships built unless they are also protected. I have heard many shipowners and merchant seamen express anxiety about the Government's policy on this score.
What are the possible threats that face our merchant shipping today? No purpose is served by hiding our heads in the sand First of all, there are nearly 400 Soviet submarines, half of them nuclear-powered, and that, to put it in proportion, is ten times as many submarines as Hitler had at the start of the Second World War.
Next, there are very highly sophisticated surface-to-surface missiles in torpedo boats and destroyers—
Mr. Ted Leadbitter: On a point of order, Mr. Deputy Speaker. I agree that the title of the debate is such that it can be interpreted fairly generally, but it will be agreed that my right hon. Friends the Members for Easington (Mr. Shinwell) and for Sunderland, North (Mr. Willey) had the specific intention to talk about the industry. I think that the hon. and gallant Gentleman the Member for Winchester (Rear-Admiral Morgan Giles) should desist.
Mr. Deputy Speaker: The hon. and gallant Member will probably realise that, in any case, I was about to intervene. It is true that the title of the debate is general, but the hon. and gallant Gentleman is getting outside even the broad title of the debate of shipping and shipbuilding into realms of defence. The intention was not to go as wide as that in this debate.
Mr. John Rankin: Further to that point of order, Mr. Deputy Speaker. In view of the interruptions caused by the intervention of the hon. and gallant Gentleman the
1202
Member for Winchester (Rear-Admiral Morgan Giles), will those of us who want to discuss shipping and shipbuilding be allowed a little extra time beyond the point at which the debate is supposed to end?
Mr. Deputy Speaker: I can give no undertaking about time. Technically, any aspect is in order in this debate, but I think that if, in accordance with the practice of the House, the hon. and gallant Gentleman will confine himself to the subject on the Order Paper, it will help the House.
Rear-Admiral Morgan Giles: I am talking about shipping, and an extremely important aspect of it, namely, that of our ships once built, and nothing is more important to the country than that they should not thereafter be sunk as soon as they get to sea.
The last of the principal possible threats that face our ships are mines, and every port on the Continental Shelf is very vulnerable to that form of warfare. I do not say that all-out attack on our shipping is the most likely thing to happen, but it is a possibility that cannot be entirely neglected.
There are also below-the-threshold possibilities. There is the individual harassment of merchant ships at sea—Interruption.]
Mr. Deputy Speaker: Order. I am unable, under the rules of order, to rule the hon. and gallant Member out of order, but he is not conforming to the spirit and practice of the House if he proceeds on the line he is taking at the moment.
Rear-Admiral Morgan Giles: With the greatest respect, Mr. Deputy Speaker, I am talking about shipping, and I am trying very hard to keep in order, having in mind the title of the debate.
Among the individual threats that face our ships, in addition to being badly constructed, or being burnt because fire precautions are not apt, are individual harassment at sea, and sabotage. After all, 40 per cent. of our merchant ships at sea have Chinese crew members. I have often sailed with them—
Mr. W. E. Garrett: On a point of order, Mr. Deputy Speaker. I am probably one of the most tolerant

1203
men in the House, but we have already decided the subject for debate. We have heard the hon. and gallant Member for Winchester (Rear-Admiral Morgan Giles) start on a defence question, and now we are coming back to protection of shipping at sea in the sense of safety regulations, which is completely beyond the scope of the debate.
Mr. Deputy Speaker: Order. I have indicated my position from the Chair. This is an Adjournment debate. I am unable to rule the hon. and gallant Gentleman out of order, but I have tried to press on him my view that he is not acting in accordance with the spirit of the debate.
Rear-Admiral Morgan Giles: Many hon. Gentlemen who have intervened in this debate, which is most interesting, have one view of shipping, but there are other views of shipping which are of vital importance to the country and, quite honestly, I do not see why one aspect is more important than another. The title of the debate is shipping and shipbuilding.
The ordinary hazards of the ocean for those ships, once they have been built and launched, are numerous, and it is the great tradition of seamen of all nations to help one another when they are in danger. I do not wish to see us, the British, with our great seafaring traditions, unable to make our fair contribution to the safety of modern shipping right round the world.
In order that the ships we have and run and build shall be properly protected at sea, we should not be deprived of aircraft carriers of some sort or another. It is idle for the Government to suggest that helicopters can suffice for that purpose. We must also not be deprived of enough frigates—
Mr. Leadbitter: On a point of order, Mr. Deputy Speaker. Would you not agree that every hon. Member with the exception of the hon. and gallant Member opposite knows exactly what the debate is about? Some of us are here to talk about the industry and the people in it. The hon. and gallant Gentleman should at least have the courtesy and manners of his Service rank and his place in the House to behave properly.
Mr. Deputy Speaker: Order. I think that the interests of the House and of those hon. Members who wish to take part in this debate would be best served if I were to allow the hon. and gallant Member to proceed, and to come to a conclusion as quickly as possible.
Rear-Admiral Morgan Giles: On the subject of courtesy and manners, Mr. Deputy Speaker, I have been interrupted about six times when speaking on a subject which is just as important as the building, the designing and the running of ships. I quite understand that many hon. Members wish to speak, but so. incidentally, do I. But in view of the obvious feeling of the House, I am confining my speech as closely as I can.
One of the most important matters concerned with the protection of shipping is that our naval forces must not be confined to European waters under a single Commander-in-Chief buried in a concrete hole in Northwood. It will be a bad day for Britain when no British merchant ships are in waters other than the Atlantic.
I do not want to go into the details of what protective measures are needed for shipping—the naval staff know what to do about this. All that is essential from the parliamentary point of view is to see that this Government do not reduce our defence forces to impotence. I have put as concisely as I can what I wanted to say on this vital matter affecting our shipping.
1.10 p.m.
Mr. Arthur Blenkinsop: I shall bring the debate back to discuss the subject which was intended. I intend to speak purely about coastwise shipping. I share a deep concern about the situation today with many of my constituents who are seamen.
I agree with my right hon. Friend the Member for Sunderland, North (Mr. Willey) about this serious matter. Many of us are concerned about the size of the fleets engaged in coastwise shipping, which have been reduced so rapidly over recent years. Compared with immediately pre-war, we have rather less than half the numbers of ships employed in coastwise shipping. One feature which concerned us is that a high proportion of British ships are being sold and there

1205
has been a great increase in the chartering of foreign vessels. This concerns very deeply seamen many of whom are my constituents.
We have to face the problem of the decline of coal cargoes. I suppose we should welcome the fact that ships are far more efficient; they use fewer men in relation to tonnage, but what we are not prepared to face without challenge is that a great deal of the coastwise trade is obtained by foreign flags. There is general anxiety lest coastwise shipping is not given its proper consideration in the whole of transport. It is very much the Cinderella of Transport. Many of us are not satisfied that the Government have given adequate consideration to the modern use of coastwise shipping today.
For example, we face the fact that in recent years there has been an increase of about 28 per cent. in foreign flag use in coastwise shipping, as against either the stability or reduction of our own shipping in coastwise trade. This is a field which needs full investigation. I am not satisfied that there has been adequate investigation of the position and the reasons for it.
For example, over many years, there was the established coal trade of the Tyne and Blyth to Cornwall, but now 87 per cent. of that trade is carried by ships with foreign flags. I have with me the names of some ships which have come in recently to this trade under foreign flags. It is fair to say that the National Union of Seamen does not want to take the kind of exclusive measures which are taken abroad. In many countries foreign flags are excluded from coastwise shipping, yet here a great deal of the coasting trade is taken over by countries which apply very tight controls for their own trade.
The National Union of Seamen does not suggest that we should apply complete exclusion of foreign flags from our coastwise shipping, but the union is concerned that there should be effective and adequate control. Over recent years there has been a rapid decline in the number of British ships used by the nationalised gas and electricity industries. I have a list of some of the ships which have been sold, but I will not take up time by reading it. It is a substantial list of 19 ships sold in recent years by
1206
these nationalised industries, 14 to foreign flags. We understand that many of those who buy those ships use them for coastwise cargoes here. This matter needs to be investigated.
I have not heard an adequate answer to the suggestion that instead of the gas boards and the electricity authority having separate fleets it might be better to combine them in one fleet although that would probably mean a diminution in the number of men employed. It would encourage the building and bringing into service of more modern vessels as it is a common criticism that many of these ships are of considerable age. Figures appear to suggest that the ships used and in the ownership of the nationalised boards are more efficient and cheaper to operate than vessels chartered from outside, but it is suggested that outside chartering is steadily increasing.
Not enough consideration has been given to the actual contributions which a modernised coastwise industry can make to transport. I want an assurance that a full investigation and full representation of coastwise shipping interests shall be included in any discussion of our transport needs. For long hauls coastwise shipping is more efficient than many other systems of transport. I am not satisfied that in all cases British rail is treating this industry fairly. Why are British ships sold at the present rate when it seems that they could be more efficiently used in a combined fleet? Is it not possible to encourage the building of more modern vessels for these purposes?
Naturally, all of us who represent seamen know too how eager they are to know when the new merchant shipping Bill will be introduced? They have pleaded for this over many years. Discussions have gone on we hope satisfactorily and we should like an assurance that the Bill will be introduced next Session.
1.19 p.m.
Mr. John Rankin: I represent a constituency in Glasgow which is one of the largest shipping and shipbuilding areas in the world. When I become a Member of this House, 10,000 people were employed in the yards there. A few years ago that number had been reduced to a little under 5,000. One of the yards, Harlands, had

1207
closed completely and two others were in danger. One was at Linthouse and the other was Fairfields, which became a celebrated cause.
I never fail to pay tribute to the fact that a Labour Government saved Fair-fields shipbuilding yards. They saved the jobs of 3,000 men and kept a great deal of the prosperity which shipbuilding had brought to Govan still alive. I never fail to give credit to the part which the Prime Minister and one or two of his prominent colleagues at that time played in saving the yard. One and a half million pounds were necessary to do so. We would never have got that sum had we had any Government other than a Labour Government in power at that time.
That is my interest in this debate. Not only is Govan a great shipbuilding yard. Glasgow, itself, of which Govan is a part, is one of the world's greatest shipping areas. Today, I shall content myself, because of shortage of time and out of consideration for my colleagues, by dealing solely with the shipbuilding aspect.
Difficulties were found to exist in Fairfield shipbuilding yard after the Government had made it possible for it to continue. Investigations and the research associated with them were carried out by a group of competent, technically and technologically trained, investigators, some of them with a national reputation. They discovered among many causes for our troubles, an outstanding one. The yard's labour force was in a state of flux. The total number of employees was 3,000. Everyone automatically assumed that the 3,000 who were employed at the end of one year were the same 3,000 who were working there in the following year. Investigation and research showed that the turnover in a given year was well above 2,000. More than 2,000 new employees had come in. There was an alarming lack of constancy in personnel.
One result was that there could be no continuity of policy within the yard. There could be no community of attitude in developing solutions to shipbuilding problems. It was like trying to build a city with a floating population. Strikes were frequent. The men, who were un-
1208
known to the Board, were never consulted about anything associated with the yard.
The big change that has taken place on Clydeside has been the creation of a Joint Industrial Council by the United Clyde Shipbuilders which under the new dispensation created there runs Fairfields, Linthouse, Clydebank, Scotstoun and the yard which mostly does Admiralty work. The Joint Industrial Council has shed a new light on shipyard problems and brought a new approach to their solution. It has made a notable contribution to creating a new spirit within the yard.
The personnel of the Council is very important. It is composed of representatives appointed by the directors from their number; by the management; by the foremen; by the national trade union leaders; by the local trade union leaders; and by the shop stewards. They discuss all problems affecting production in the yards at all levels—wages, hours of work, output, methods of production, grievances, contracts of employment; indeed, all matters affecting the life and living of all employees in the yards at whatever level they operate.
This new spirit of community is reflected in today's order book which, since 7th February, when U.S.C. was constituted, shows £20 million worth of ships waiting to be built or in process of building at the yards on Upper Clydeside, including one container ship won at a price of £5 million against world competition. Out of a total of 13,000 employees, there has not been one redundancy since the start of the new era.
Though the Linthouse division will cease operation in August of this year, the engineering side, employing 1,600 persons, will not be affected. This should be made widely known, because the closing of Linthouse has been interpreted over a very wide area as the closing of the entire shipyard including the engineering side, whereas its 1,500 shipyard workers will be absorbed in the other divisions—at Clydebank, and so on. A new design establishment will be opened where formally the yard stood.
On Clydeside today the big change which has taken place is that men matter in shipbuilding and they realise that they matter. That is the important revolution which has happened in my area during the last few years. Their job is important at whatever level they perform

1209
it. So the necessity for disciplines like good time-keeping is accepted, and cooperation in getting the ship launched on schedule ensues.
Modernisation is a necessity—a must, if you like. The former Fairfields shipbuilding yard, the new Fairfields shipbuilding yard, and the U.S.C., have all, in their turn, modernised; but, as Geddes has said, "Modernisation is not enough". Nor even are excellent ships, though they embody in their construction the most recent technical innovations. To maintain or recapture a world position in shipbuilding three musts are involved. First, we must have the complete support and co-operation of the men in the yard by guaranteeing them their income. Second, the discipline of work at all levels must be upheld. Third, we must maintain a programme for the men to ensure continuity. By shaping our policy along these lines Britain will recapture her world position in this famous industry.
1.30 p.m.
Mr. Ted Leadbitter: My first word is to compliment my hon. Friend the Member for Glasgow, Govan (Mr. Rankin) on an inspiring though brief and constructive speech, the kind of speech which we like to hear on this important subject.
Also, I follow my right hon. Friend the Member for Sunderland, North (Mr. Willey) in his comments, perhaps underlining what he had to say by referring to the release provided by the information office of the shipbuilding industry only yesterday. The total order book in this country up to 30th June this year shows 207 ships at just over 2½ million gross tons. The new orders received in the 12 months up to the end of June, cover 173 ships to a total of 1,898,000 tons. The House is always pleased to see such a signal improvement in new and total orders and to congratulate the shipbuilding industry and all those who work in and for it.
Nevertheless, we must come down to the central question in regard to any industrial activity, namely, to what extent do the people who work in it benefit, and to what extent do they have security? In a modern society, there is no point in a man or woman developing a high excellence of skill if, round the corner, there is always the dread possibility of un-
1210
employment. The shipbuilding industry must look at itself from that point of view.
Hon. Members on both sides always feel sad at any turn of events such as that which I am about to relate, but for me the matters which I have to raise are particularly painful. I have reached the point when I can hardly go on Recess without a feeling of utter dismay in the knowledge that in my constituency and the area in which I live, the Teesside and Hartlepool area, about 2,500 people are to lose their jobs. As a Socialist, I gave my word to the electorate that conditions would be better. There is not one hon. Member on this side, or, I am sure, in the House as a whole who can be happy at the spectre of unemployment, no matter what the cause, no matter what the purpose of industrial reorganisation may be. The prospect that men and women committed to their standards of life and with the asset of their skills may in 1968 have to move out of the industry which they love and for which they have worked is a matter of real national concern.
I have some pertinent questions to put to the Minister. I am referring, as he knows, to the Furness shipyard. From time to time, we have appealed to the Government for a holding operation to keep the men at work. Can he tell me of any occasion anywhere in the world when a modern shipyard has closed at a time of increasing building operations? Does he deny that the Furness shipyard is the most modern in the United Kingdom, and, indeed, one of the most modern in Europe? Does he deny that in recent years—I am talking not just of the latter years of the decade—£2½ million of public money has been put into that yard, which is now held by private enterprise?
If he cannot deny that, will he say who will have this £2½ million of British investment in the form of grant when the yard closes, the last man leaves and the gates clang shut? Does Mr. Charles Clore get it? Does Sears Holding Company get it? Where does it go? Who will buy the assets of the yard when it becomes undervalued purely because it is silent and inactive, though every piece of equipment in it is modern, automated or semi-automated, the most rationalised yard in the United Kingdom?
Am I expected to sit in the House of Commons and refrain from asking, "Is

1211
there no damned justice in the world if 2,500 men get their cards, and Mr. Charles Clore gets his benefit out of public money in the form of grant?"
I want my hon. Friend the Parliamentary Secretary to dwell upon these matters. I want him to tell the House by what stretch of imagination we can reach a point when there is increasing shipbuilding capacity in this country but nothing is done about the inherent injustices which arise from our own investment incentives.
Will my hon. Friend answer some more simple questions? How does it come about that £36 million of taxpayers' money is given to foreign shipowners with registered offices in this country who can use that money to buy ships abroad? How does it come about that British shipowners are calculated to receive in the next few years £65 million with a right of option to build their ships abroad? How does it come about that a country which is still a major maritime Power cannot sustain its own shipbuilding industry?
I want my hon. Friend to answer these questions. I told him by letter that I should be raising them with him today. The Government have done what, possibly, no other Government have ever done in helping the shipbuilding industry, with a measure of wisdom, pride and generosity for which they have never received due credit. Financial support for the shipbuilding industry runs to something like £250 million. The Shipbuilding Industry Board has at its disposal about £32½ million for the reorganisation of the industry. The Industrial Expansion Act provides another £20 million, and other facilities for the shipbuilding industry and shipping amount to about £200 million.
While I charge private industry for taking money from the British taxpayer in order to reorganise, I directly charge the private sector of the shipbuilding industry with neglecting that support and behaving as though it were still composed of ordinary companies which think that if they cannot make their way as they want they will run out, as Charles Clore's company is doing.
My charge is not so much against the Government, but against the 19th-century
1212
attitudes and ways of thought still in the minds of some British shipbuilding industrialists. But, if I am not charging the Government with what has happened at Furness, I say to them none the less that, as they have shown the power and readiness to help the shipbuilding industry, they can do the same for Furness.
There is great social cost in having nearly 3,000 men out of work—all the unemployment benefits, redundancy payments and so on, with, at the periphery of the industry, the cost to ancillary services, shopkeepers and the rest. There is, I plead with the Government to consider, the great social cost. They would do far better now to have a holding operation at Furness. With shipbuilding capacity in this country now beginning to boom, the 1970s will prove to be a time when we shall still need that modern yard. It is false economy to reduce our shipbuilding capacity.
So, on the basis of economic wisdom and the basis of social justice, I plead that the Government should show private enterprise that they can project their already valuable aid to a point where there is a deep wound and carry out an operation to clean it up and heal it so that the shipbuilding industry and all the men and women in it can feel that, come what may, we have a Government who will keep it steady, growing and healthy.
1.40 p.m.
Mr. Gordon A. T. Bagier: I want to follow on what my hon. Friend the Member for The Hart-lepools (Mr. Leadbitter) has said. One of the disturbing features about the ultimate closure of the Furness yard is that it is a unit taken out of the shipbuilding complex of the country, particularly in the North-East. I remind my hon. Friend that the Northern Group of Members of Parliament has been pressing the Minister for some months to see whether something can be done about the yard.
In the light of the relatively boom conditions upon which the shipbuilding industry has entered, I feel that any closure of any part of the industry, particularly a modern unit, would be detrimental to the industry.
This week we have received news about orders about which we should have been

1213
laughed out of court if we had been trying to forecast them two years ago. The Shipping Gazette states that this is a red letter week for the River Wear because of the number of orders received. The article ends by saying that the additional negotiated contracts in the pipeline are the most memorable in the industry of the Wear.
It may well be said that the situation is nothing to complain about. But I would utter a word of warning. We cannot accept a situation of boom conditions that leads to another slump. I remind the House that the right hon. Member for Wallasey (Mr. Marples), when the Conservative Party was in power, did his best for the industry by providing a credit of £70 million. But this was immediately gobbled up by the industry and nothing was done about reorganisation. The present Government have provided a large amount of credit for the industry and a large amount of money for the purpose of reorganisation. We have told the Shipbuilding Industries Board that if public money is to be used we must have results in the form of a regrouping of the industry. This is why my right hon. Friend the Member for Sunderland, North (Mr. Willey) and I have been disturbed about the lack of progress on the Wear.
Other features are involved, such as long-term employment for those in the industry, who are fed up with being laid off for two or three months every year. We want to see the Wear healthy and proceeding along the same lines as the Clyde and the Tyne. I recognise that the Tyne is getting ahead with longstanding agreements to provide stability in the industry for those who have had more than their fair share of men waiting at the gates. The industry is an extremely important factor in our economy. It is a very high foreign currency earner. I give great credit to some of the yards in the Wear for capturing a larger corner of the Liberty ship replacement. This is for the benefit of the country.
But we must not sit back and be complacent. The present situation is the result of Suez, the advantage provided by devaluation, and, even more important in the long term, the fact that we have a lot of orders because of our short
1214
order book and not because of cost. If we sit back and complacently hope that this will carry on when the short order book period is over and we go into open competition with the Japanese, the Swedes and our other competitors, we may start slumping down, with the resultant effect upon the people in the industry.
This has been a very important debate. My right hon. Friend the Member for Sunderland, North quoted some words from the Geddes Report—that we can either decline, hold on or grow. What the House and the Government want from the industry is growth. We do not want to consolidate a position where we are producing the same number of ships of reduced capacity with a reduced work force. We want to bring into operation the whole of our facilities and aim at a larger section of the shipbuilding industry of the world. I am convinced that with our skills and with the co-operation which the trade unions are now giving to management and with the financial help that the Government are giving the industry, Britain can aim at a larger share of the shipbuilding of the world and do it on a straight competitive basis founded on skills and costs.
I have intervened only briefly because of shortage of time. I applaud my right hon. Friend for giving the House the opportunity of this debate.
1.45 p.m.
Mr. W. E. Garrett: I am pleased that time has been provided for this important debate. I congratulate my hon. Friend the Member for the Hartlepools (Mr. Leadbitter) and my hon. Friend the Member for Sunderland, South (Mr. Bagier) on thoughtful and stimulating speeches about this important sector of our economy.
Unlike the Wear and the Tees, there is on Tyneside a period of quiet confidence. Undoubtedly the Tyneside shipbuilding consortium has gradually acquired economic strength which should allow it to meet overseas competition with every degree of confidence.
A variety of factors have brought about this happy situation. The major one is the present Government's financial policy of support to the shipbuilding sector of the industry. There has been a realisation that the industry has acquired

1215
more know-how in construction, thus enabling keener competitive prices with other shipbuilding nations.
The trade unions, after a few doubtful thoughts, appear to have accepted the need for a responsible attitude to wages and labour problems, while management, after some initial blunders in the field of industrial relations, appears to have obtained the confidence of the trade union leaders.
However, I think that more credit should be given to the salesmen who travel the world to obtain the orders. Both senior management and employees should appreciate how successful this group of dedicated men have been in winning orders against very difficult odds. This gradual building up of team work augurs well for the shipbuilding industry.
My hon. Friend the Member for South Shields (Mr. Blenkinsop) referred to coastal shipping. He gave some interesting statistics. I should like the Government to examine some elements of the problem as it affects coastal shipping. There should be an examination of the part that the industry will play in an integrated transport system. My right hon. Friend the Member for Sunderland, North (Mr. Willey) said that consideration should be given to the introduction of a national shipping line, which would integrate all forms of shipping and work out a new life-saving policy for coastal shipping. I still think that there is a great future for British coastal shipping, especially in view of the development of container ships, and there is also, of course, increased traffic to the Continent.
I hope that some of the problems that I have mentioned will be dealt with by the Minister. If he cannot give an immediate reply, I hope that he will consider them when he deals with matters affecting his Department.
1.49 p.m.
Mr. Edward M. Taylor: This has been a very interesting and stimulating debate. Every hon. Member who has taken part has had a very real interest in the two great industries, shipping and shipbuilding.
I am sorry that the one note of discord was the heckling of my hon. and gallant Friend the Member for Winchester (Rear-
1216
Admiral Morgan Giles). Perhaps hon. Gentlemen who were anxious to speak were a little unfair to him. He was referring to a very vital question—now can we not realise how important security is to our own ships at a time when so many of our own vessels are locked in the Suez Canal, and how important, also, is naval shipbuilding, which employs about 20 per cent. of the manpower in our shipyards?
Shipbuilding is a very vital industry. About 73,000 people are employed directly on shipbuilding and ship repairing, and about 200,000 families depend directly or indirectly on shipbuilding for their livelihood. Numbers do not show the real importance of the industry. As the hon. Member for The Hartlepools (Mr. Leadbitter) pointed out, they are employed in just the places where the economy needs to be stimulated. Therefore, when a yard closes, or is in difficulty, it is of even greater significance because it happens in areas like the Clyde, Tyneside and Northern Ireland, where we have an over-dependence on heavy industry and jobs in shipbuilding, which is concentrated, are so important. This makes it even more vital for our economy as a whole that shipbuilding should prosper.
Several hon. Members have stressed the importance of the Geddes Committee, and what a difference it has made to the industry's outlook. This is certainly true. I believe that we have at present a very happy situation in orders. As the hon. Member for South Shields (Mr. Blenkinsop) said, in the first six months of this year we had an additional 1 million gross tons in orders, which is the highest figure for such a period since 1957. We now find ourselves with a total order book of about £300 million, a very substantial and happy order book indeed.
Many reasons have been given for this improvement, but I agree with the hon. Member for The Hartlepools that shipbuilding credits have been the most significant, the availability of credit. In the international market the cash customer has almost disappeared, and the most vital thing in obtaining new orders is good credit facilities. We saw an immediate upsurge in orders in the shipbuilding industry when my right hon. Friend the Member for Wallasey (Mr. Marples) brought in his shipbuilding

1217
credit scheme, providing around £75 million. Afterwards, we had a decline. Now, with the assistance of the banks, the Government have been able to provide £200 million of credit, and we have had another upsurge of orders.
Although we now find ourselves in a happy position once again, I and other hon. Members fear that once the £200 million of favourable credit is exhausted we could be back to square one. Perhaps it would be a little unfair to say that, because as a result of the Shipbuilding Industry Act major reorganisations have taken place on the Tyne and Clyde, so that we shall not be going back exactly to square one. But there is a real danger of a dearth of orders if steps are not taken to provide credit, if it is required, in fair competition with our international competitors.
Section 7 of the Act mentions £200 million. My information is that while the money has not been spent most has been allocated, and there is a real danger that, once it is absorbed, the sheer pressure of foreign competition and the foreign availability of cheap credit will make it very difficult for the upsurge in orders to continue.
Therefore, we are entitled to ask the Minister what will be our position if the order book declines substantially once the credits are exhausted. If they were not available we might find ourselves in the position we were in in 1966, when only 482,000 gross tons were ordered, because the foreigners could offer credit at 4 and 5 per cent. for about 90 per cent. of the value of the ship, and our own shipbuilders could provide only 8 or 8½ per cent. rates of interest for about half the value of the ship. The Minister has an obligation to say today, while things are rosy, what will be the future position once the credit is exhausted.
But credits were only part of the story. Major reorganisation and changes in attitude were the result of the changes in structure which were brought about. This has been a major step forward, but it is wrong to underestimate the great changes involved and the difficulties of firms in co-operating and becoming part of an integrated shipbuilding group. We have seen the difficulties on the Wear. Perhaps they have been exaggerated, because while it was contended that people
1218
would not come round the table together, progress has recently been made there. But there is a great danger in making the assumption of the Shipbuilding Industry Act that extra size will necessarily guarantee greater efficiency and success. We have many examples of individual shipyards not acting as part of a group that have a wonderful success story.
The most important part of merging is the greater security it brings. The hon. Member for The Hartlepools spoke sincerely on this point, and the hon. Member for Glasgow, Govan (Mr. Rankin) explained what a great difference job security could make to attitudes. Perhaps too much emphasis has been placed on the damaging effects of the old régime because, of course, there are men moving from one yard to another. The hon. Member for Govan mentioned Fairfields and how it had a turnover of 2,000 in a total labour force of 3,000. But within the shipyards of the Clyde there is bound to be a great deal of movement as the finishing trades move from one yard to another. While there certainly was redundancy, some of which has now been removed, one could over-estimate the changes which took place in the past.
I am surprised that no hon. Member has mentioned one of the basic recommendations of the Geddes Committee, on the question of steel prices. We talk a great deal about shipyard efficiency, but often forget that 75 per cent. of the cost of a ship is entirely outwith the control of the shipbuilders. With the greatest efficiency and reorganisation, they can change only the other 25 per cent. Steel amounts to about 20 per cent. of the cost of a ship. Geddes recommended a rebate, but we have not yet see much progress. Can the Minister give us any information?
On a purely Scottish point, what will be the steel industry's future pricing policy? We have had a uniform price for steel in Scotland, though we have suffered from differentials in the prices of gas and coal, which are so high. There is very considerable alarm on Clydeside that the nationalised steel industry might bring in differential prices, which could go against Clydeside's interests.
I should now like to say a few brief words on shipping, to which the right

1219
hon. Member for Sunderland, North (Mr. Willey) referred in his interesting speech. Flags of convenience are a serious problem, and we have a problem in coastal shipping. We should not try to approach the problem of flags of convenience from the negative point of view, with the country trying to take in its own washing. As an international trading nation we could not afford to do that. Perhaps we have been a little unfair on the flags of convenience countries, some of which have very high standards. We want to ensure international freedom of the seas for our ships to sail wherever they can. This is a matter for international co-operation.
We can under-estimate the great value of our coastal shipping trade. The White Paper on the Transport of Freight said that the Government recognised the enormous contribution which coastal shipping makes, and accepted the principle that competition must be fair. There was a very valuable protection for coastal shipping in the 1962 Act, and there has been protection going back to 1921. A safeguard against unfair competition by British Railways could be invoked if the Government gave assistance to British Railways by way of deficit financing.
The Transport Bill has swept the deficit under the carpet. Instead of a deficit of £150 million, there is an annual grant through loans, write-offs and subsidies of about £140 million. Therefore, this protection is entirely removed. Can the Government give us an assurance that the protection of fair competition with British Railways will be brought back?
The hon. Member for South Shields spoke of the possibility of future legislation for the shipping industry. Progress has been remarkable between the shipowners and the unions concerned, and I understand that the report of the Pearson Court of Inquiry has been accepted in toto by both management and men. There have been eight meetings and great progress has been made. There is agreement in principle. I understand that, at the next meeting in September, more progress is expected. Can the hon. Gentleman tell us whether legislation will follow?
This has been an interesting and stimulating debate. It has shown the whole in-
1220
dustry that, while it has its problems, at least it has many friends in the House of Commons.
2.0 p.m.
The Joint Parliamentary Secretary to the Ministry of Technology (Mr. Gerry Fowler): This is a fascinating debate on two important and related topics—and perhaps some topics not very much related to either. It is the first general debate we have had on shipbuilding and the shipping industry during the past year and I welcome it for that reason. I have been asked many questions—far more than I can answer in the brief time at my disposal, but I will do my best.
The shipbuilding industry is in much better shape than it was a year ago— there is no doubt of that. The hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) has just mentioned that over 1 million gross tons of orders have been booked in the first half of the year. This is the best figure since 1957. I make no apology for re-emphasising that. It is an excellent record, the best for 11 years.
At the end of last month, the industry's order book for merchant shipping amounted to 2,569,000 gross tons at an estimated value of £300 million. This is a much more encouraging situation than we have known for some time. Nevertheless, there is no room for complacency. The industry must maintain its efforts to obtain orders because the world market in ships has always been volatile and fluctuating.
There can be no certainty that the high level of ordering we have seen in recent years will continue. That is why I am glad that hon. Members have drawn attention to the need to use the present improved situation in the industry as a breathing space in which to carry through reorganisation and to improve the long-term competitive position.
My right hon. Friend the Member for Sunderland, North (Mr. Willey) and my hon. Friend the Member for Sunderland, South (Mr. Bagier) drew attention to the situation on the Wear. I do not want to go into detail about the situation there, but to do what they did—use it as the basis for a homily. It is true that some reorganisation and modernisation has taken place on the Wear during the last 15 years. Nevertheless, I hope that

1221
neither there nor anywhere else will shipbuilders: be deceived by the present improvement in their position into thinking that they can thereby dispense with the need to reorganise their resources and to modernise not only their plant but their working practices. I hope that they will take the opportunity offered by the Shipbuilding Industry Act and the Shipbuilding Industry Board—I remind them that the life of the Board is limited by the Act to the end of 1970, although it is extendable by one year only—to reorganise their resources so that, when the Board does go out of existence, they will be able to stand on their own feet against competition from all over the world.
The position has already improved in this sense. I am glad that my right hon. Friend the Member for Glasgow, Govan (Mr. Rankin) drew attention to the position on the Upper Clyde. He said that the order book there was £20 million. He was not quite right. This is the figure since the formation of Upper Clyde Shipbuilders. I am sure that is what he intended to convey. This is a dramatic improvement in a relatively short period.
Perhaps even more important is the partnership established between the workers in the industry and the firm which employs them. There is now the Joint Industrial Council and a unique experiment in labour relations in this industry—the sort of development we all hoped would come out of the old Fairfields scheme. The management of U.C.S. has repeatedly said that it will adopt the best management practices to be found not only in shipbuilding but in industry generally. It learnt from Fairfields and elsewhere to establish a new system of labour relations on the Upper Clyde and this has enabled it, in conjunction with the order book, to guarantee that, provided there is mobility of labour, there will be no redundancies in the first two years of the operation of U.C.S. This is something for which we are profoundly grateful.
On the Tyne, things are also much improved. Orders of £46 million have been taken since the beginning of the year. I hope and expect that we shall have further good news from the Tyne in the near future. I was impressed by the statement made by Sir John Hunter, at a launching on the Tyne
1222
recently, that the Tyne has now a consistent record of early delivery. That cannot be emphasised often enough. The old days when, perhaps justifiably, some sectors of the industry acquired a bad reputation for late delivery are becoming, thank goodness, a thing of the past.
My hon. Friend the Member for Wallsend (Mr. Garrett) spoke of the prospects on the Tyne. He mentioned difficulty in securing a labour charter there. Talks have been going on for some considerable time and the news is very hopeful and encouraging. I hope that soon we shall see the labour situation on the Tyne transformed in a new formal agreement.
So much for the success half of the story. I want to say a word about another area, because my hon. Friend the Member for The Hartlepools (Mr. Lead-bitter) dwelt at some length on it. It is less of a success story. It is, of course, the Furness yard. I need scarcely say that I agree with my hon. Friend the Member for Govan that men matter. It can please no one to see such excellent facilities going out of shipbuilding. Nevertheless, we must make some qualification of what my hon. Friend the Member for The Hartlepools said about the Furness yard.
That it is a modern yard in terms of steel-working facilities, I would not dispute. Nevertheless, there are certain weaknesses in the physical structure which must be borne in mind because they make the problem of securing its long-term future more difficult. It is suited for the building of bulk carriers and tankers but. unfortunately, the size of tanker it can take is limited, and for the yard to build very large tankers of the future in competition with other yards, even if it were possible, would be very expensive. So some qualification must be made of my hon. Friend's characterisation of the facilities available at the yard.
My hon. Friend suggested that the proper solution would be for the Government or the Shipbuilding Industry Board to carry out a holding operation. Holding for what? The basic situation is that the yard has long-term prospects only in so far as it can be made part of a larger group in the North-East. It could then contribute its strength to the larger group and take its share of the work.
Mr. Leadbitter: I remind my hon. Friend, on the question of a North-East grouping, that there was a meeting last year and that shipbuilders on Wearside and Tyneside will have nothing to do with it. On the size of tankers, the Geddes Report refutes every word my hon. Friend has just said.
Mr. Fowler: I do not want to dwell on this, because the House must move on to another debate.
On the size of the tanker, I do not know to what my hon. Friend is referring, because it is an inescapable fact that the Furness yard can cope with tankers up to about 200,000 tons deadweight, or just over, whereas the size of tankers on order has already escalated. I think the largest is 312,000 tons.
If we are to solve the Furness problem, we must consider ownership, management and orders. Those three things go together. It is no use getting orders unless we can settle the ownership problem, or unless we have an efficient management to take over the yard to secure a continuing flow of orders. For the Government to step in to subsidise orders, thereby, in all probability, taking them away from other yards in this country, and to find, three years hence, that we are in no better position than today at Furness would be a profound error.
I do not want to sound entirely negative. This does not mean that we have abandoned hope of saving Furness. This is a different question. The answer may yet come, but it will not come by the Government saying, "Clearly, the answer is for us to step in and put up money", which may be good money poured after bad.
Reference has been made to investment grants. Investment grants for shipping were designed to encourage the modernisation of our shipping industry as well as to secure orders for our shipyards. But we must not forget the shipping aspect. This is a subject to which the Government devote continued attention. It may be that we shall be able to remove some of the anomalies concerning investment grants for ships. There was a change in January this year. But we have to look at the interests of the shipping industry as well as the shipbuilding industry.
Finally, I have been asked various questions about coastal shipping. I must
1224
be brief on this. Perhaps the wisest thing I can do, since I have no departmental responsibility for the matter, is to draw the attention of my right hon. Friend the President of the Board of Trade to the points that have been made.
However, I will say a word on the proportion of coastwise traffic carried in foreign bottoms. From what some of my hon. Friends were saying—and I do not want to minimise the problem—one would think that this had become a large proportion of coastwise traffic. The proportion of dry cargo in 1964 was 2·3 per cent. It rose to 2·5 per cent. in 1965 and it was about 3·3 per cent. in 1966 and 1967. The latest available figures show that it has been running at about that level over the first four months of this year. So, while there is a problem, it is not as serious as has been suggested.
We are not unique in permitting foreign bottoms to trade around our shores. France, the Netherlands, Germany and Italy reserve their coastal trade, but Belgium and Norway, like us, do not. I trust that my hon. Friends will not exaggerate the nature of this problem.
Mr. Deputy Speaker: I thank right hon. and hon. Members for their cooperation. The debate that we are about to embark upon must finish at 3 o'clock. Therefore, I hope that hon. Members will bear in mind there are others who wish to speak. It will help if speeches are kept brief.

OCEAN FLOOR
2.15 p.m.
Mr. John Tilney: In column 50 of Vol. 537, No. 34, of HANSARD I am reported as asking the Secretary of State for Foreign Affairs:
"Whether, since the freedom of the seas is of paramount interest to this country, and since it is possible for oil and other minerals to be discovered outside territorial waters, Her Majesty's Govenment will propose that the residual areas of the ocean bed and their superjacent waters shall be put under the jurisdiction of the United Nations?"
The answer was:
"No. Her Majesty's Government are concerned to preserve the principle of the freedom of the seas …"
The Minister then was my right hon. Friend the Member for Thirsk and

1225
Malton (Mr. Turton) and the date, 16th February, 1955. One wonders whether the position of Her Majesty's Government has changed in the 13½ years that have elapsed since then. Indeed, they were asked only last Friday in another place what initiative they were taking at the United Nations to safeguard the extra-national wealth of the sea bottom for the benefit of all nations. Lord Caradon replied:
"The initiative in this important issue was taken at the last Assembly of the United Nations by the delegation of Malta … The United Kingdom delegation … supported the initiative. … Her Majesty's Government are now engaged on a thorough study of the complicated issues involved … the aim being to give our delegation to the conference which is to take place in Rio … next month full and positive instructions. …"—[OFFICIAL REPORT.House of Lords, 19th July, 1968; Vol. 295. c.581.]
Perhaps the Minister will tell the House what those instructions are likely to be.
It is, I admit, a considerable problem. The International Conference on the Law of the Sea in 1958 coped somewhat imperfectly with the question of the Continental shelf allowing coastal states to claim that self
"to a depth of 200 metres",
but then, very surprisingly, added.
"or beyond that limit, to where the depth of the superjacent waters admits of the exploitation of the natural resources of the said areas."
They appeared to be unaware that due to advancing techniques such words could produce an elastic frontier and that by such phraseology some coastal States could in due time claim most of the ocean bed.
Is, therefore, the old doctrine of "freedom of the seas" out of date? It has certainly led to great inefficiency in the allocation of capital and labour over fisheries. For instance, it is said that 25 per cent. fewer vessels could produce the same catch of haddock from the George's bank and 50 per cent. fewer would produce the maximum economic revenue. Man is now exploring the ocean depths as Columbus did the Western Atlantic. He had no idea what was beyond the coast he had found. Nor really have we.
If I may change the analogy nearer home, I am reminded that long before the Enclosure Acts, the forest was part of the village depth. Men had rights to cut wood or feed pigs there. But
1226
they were at least controlled by the Lord of the Manor. There is no international Lord of the Manor. Is the ocean, therefore, a No-man's sea? The lawyers may talk of res nullius or res communis but it is anarchy which prevails on the surface, in the deep waters, and on the ocean floor. In any case, all three should be considered together when discussing areas beyond the present limits of national jurisdiction however defined.
But does anarchy matter in those areas? Before I answer that question let us consider what we already know might be acquired and how.
First, what in the depths are the possible prizes for man? It is said that there are much greater resources under the seas than on land or under land. That is not surprising as 71 per cent. of the globe is covered by seawater and has never really been prised open. But already 16 per cent. of the world's oil and 6 per cent. of our natural gas comes from off shore.
People say that they can exploit oil at present lying under deep water salt domes 1,000 metres or more below the surface of the sea. There are minerals on the ocean floor, deposits of phos-pherite and great nodules of manganese mixed with copper nickel and cobalt. There are minerals in solution, too, and in the hot high gravity pools in the Red Sea the precipitation of that solution is abnormally heavy.
Secondly, what technically can man now achieve and how can he get at this potential wealth? Submersible vessels can now go down 7,000 metres below the sea surface. This means that almost any part of the ocean floor can be explored within the next few years. Already a prototype for mining at a depth up to 4,000 metres is under construction. In a few years men will actually live 1,500 metres under the sea. This year the operations of Sea Lab III will show that man can live for a long time at the shallower depth of 150 metres with limited excursions to 220 metres.
This already opens up to man all the continental shelves and the summits of the great submarine mountain ranges too. The N.R.-I, the first nuclear-powered deep ocean research submersible is now under construction.

1227
What are the dangers ahead? First, on the principle of "first come, first served" nations might grab what they can, and super Powers might plant their flag, or its equivalent, under the sea. There are no weaker peoples whose territory has to be divided, as in Africa a century ago. But if the prizes are great enough, major disputes or even wars may be caused by national greed to get at undersea wealth.
Secondly, careless nuclear mining techniques may impair marine environment on a far greater scale than bad coal mining did in the past to some areas of Durham or than "catch-as-catch-can" has done to some kinds of fish. Thirdly, pollution can come from dumping radioactive waste or by causing a radioactive explosion to bring to the surface the near freezing waters of the deep in the hope of making an artificial Humboldt or Peru Current. To quote the report of the Secretary-General to the Economic and Social Council of the U.N., during the forty-fifth Session:
"… a strip of ocean one hundred miles wide and one thousand miles long, near the surface forms a permanent green pasture, as productive for animal life as the blackest soil of the Ukraine,"
It could also alter the climate of another country. For these great unfenced ranches of the sea could be affected by the hand of man just as those on land have suffered from cactus thistle, rabbit, dust, erosion or fire, all because of man's actions.
What a vast potential there is. No one knows, within a factor of ten, how many fish there are in the oceans. Already here and there hunting has become farming. The Japanese, by putting oysters on ropes out of the range of bottom-living predators have improved productivity from 700 kilogrammes per hectare to 35,000 kilogrammes—a 50-fold increase. All this could be affected by the action of other nations on the ocean floor, or above through oil spillage. Such action could alter drastically the fish harvest which has doubled since 1955 and which in 1964 produced one quarter of the world supply of protein—40 million tons of it. Yet earlier this week we were talking about the need for a few hundred tons to feed the starving Nigerians.
The fourth danger is the greatest. A Soviet scientist said recently:
1228
"The nation that first learns to live under the seas will control the world."
Our present deep-sea maps are comparable to those our forebears had for the land 250 years ago. Submersibles, with missiles, either for defence or offence, will be able very soon to hide in the mountain crevasses of the great Atlantic Ridge, and lurk there, unseen, unheard and undetected. Already a United States Alvin has done over 1,000 dives and two new ones are building, to operate at 6,500 feet.
Conditions for sea warfare are now utterly different from those of the last war. Once it is possible to transfer men and cargo from submarine to submerged off-shore terminals, the naval vessel would be completely divorced from the surface. In the words of the Institute for Strategic Studies Adelphi Paper of March:
"… the under-seas weapon system could develop into something akin to a manned, on the bottom, slowly mobile mine."
These were written by Dr. Craven, Chief Scientist U.S. Deep Submergence Projects Office.
What are the legal possibilities? There are four alternatives. First the coastal nations can claim the continental slope and all the ocean floor beyond, halfway to the country on the other side of the ocean, and merge it with their own Continental shelf. This would be a very uneven distribution. Land-locked states would get nothing; Those bordering semi-inland seas not much. Barbados could claim more than the Soviet Union. Half of the East Atlantic would go to Portugal, and vast sections of the Atlantic to Britain, because of her island dependencies.
Secondly, the ocean floor could be allocated by right of grab and exploitation. This is the law of the jungle. Thirdly, claims could be granted by an internal registry office on the basis of first come first grant, but disputes would be legion, even though the grant would be limited in time. Fourthly, the nations could set up an extra-national authority to grant leases and extract rents—an autonomous agency, like the World Bank emanating from the U.N. or, because several important nations are not U.N. members, a completely new extra-national body in which all could participate, could be set up to supervise the operation and extraction on the ocean floor.

1229
This alternative seems much the best one to me. It would provide security of investment and be the most efficient way of exploiting minerals. It might take a long time to frame the necessary laws, and the laws must be implemented by some force. Senator Pell of Rhode Island, who has given so much thought to this problem urges a United Nations Sea Guard, under the control of the Security Council. There should be enough revenue to pay for it from the rents and royalties of the concessions. It is time action was taken before trouble arises, and before we know how great the prizes are. Moreover, national interests are not yet too closely identified. Action has been taken over Antarctica and outer space. The deep seas and ocean floor are nearer and much more important. Do not let us just wait and see what others try to do. By the time the world has really seen the possibilities it may be too late to save a catastrophe.
I would urge the Minister to take note of Motion 271, signed by 123 hon. Members and referred to on 4th July by the hon. Member for Rowley Regis and Tip-ton (Mr. Archer) which says:
"That this House believes the time has come to declare the deep ocean floor conserved as a common heritage of mankind, and that steps be taken to draft a treaty embodying inter alia the following principles:
that the seabed beyond the limits of present national jurisdiction,

(a) be conserved against appropriation by nations or their nationals so that the deep ocean floor should not be allowed to become a stage for competing claims of national sovereignty.

(b) be explored in a manner consistent with the principles and purposes of the Charter of the United Nations.

(c) be exploited economically or made use of with the aim of safeguarding the interests of mankind.

(d) be conserved exclusively for peaceful purposes in perpetuity."

I have just received the June issue of a magazine called Hydrospace. I would commend the articles in it. They show how little we are doing and how much America is doing. Perhaps the Minister will say what the United Kingdom is doing about research?
2.28 p.m.
Mr. Peter Archer: The House will be most grateful to the hon. Member for Liverpool, Wavertree (Mr. Tilney) for that very careful and exhaustive summary on the
1230
subject. I can be very brief as a result, and it is as encouraging as it is frustrating that so many hon. Members are attempting to speak in this debate. The whole problem comes to a head because of the enormous advances in technology recently, advances which make available to us a wealth at which we can only guess, and perhaps new ways of life which defy even our capacity to guess.
It is perhaps a comment on our way of running the world that this enormous treasure, which has been described by President Johnson as a common heritage of mankind, with the miraculous key to unlock it which technology has delivered into our hands, has created problems as various and bewildering as the advantages which it offers.
Mankind's activities on the sea are broadly where his activities were on land 4,000 years ago. He cultivates hardly any crops. He has only barely begun to exploit mineral resources. He hunts wild creatures for food but has not begun to farm them. There are virtually no standards of right and wrong governing his conduct other than what is physically possible for the strongest and most cunning. All this over an area which covers but about five-sevenths of the world's surface.
I need not elaborate the technological advances now open to us. There is the United States Ploughshare project. They are already experimenting with the possibility of retrieving minerals by nuclear explosion at enormous depths. It is possible to adapt human physiology to a point where human beings will become literally at home under the sea. It is said by experts that by 1975 colonies of aquanauts may be living and working for long periods at depths of up to 500 metres. There are high mineral possibilities. There could be fish fanning on a scale which could solve man's food problems for ever, and all this is coming at a time when many countries are finding that their land resources are under greater pressure than ever. Here in the United Kingdom we are finding that there is not enough land to go round.
This box contains dangers as well as treasures. One can think immediately of four. The first is that increased activity on the sea will produce a conflict between the various uses. We know already that drilling rigs are proving navigational

1231
hazards. Mining activities can be a very serious danger to fish life. Secondly, there is pollution. Up to very recently, the sea was thought of as an inexhaustible rubbish tip. Already we know some of the effects of sewage. We know what can happen when oil is deposited haphazardly into the ocean. It may not be long before we know what happens when nuclear waste is deposited in the same way. We know already the disgusting effects on beaches and the disastrous effects on fish life. How long will it be before we learn of the effects on the climate and health of adjoining countries?
Thirdly, as the hon. Gentleman indicated, the ocean floor could very well form a perfect base for military purposes. It is less vulnerable than the land and less susceptible to inspection. Therefore, this treasure house of human welfare could well become a base from which to destroy humanity.
Perhaps the most serious of the four dangers is that now there is an inducement, of which the hon. Gentleman has spoken, to rush to acquire territory and resources—an uncontrolled, unrestrained Klondyke over five-sevenths of the earth's surface, without law and order, and guided only by greed and naked force. It could make the scramble for Africa in the 19th century of which the hon. Gentleman spoke seem like the vicar's cocktail party.
A great deal of thinking has already been done on this matter. I ventured to indicate when I was fortunate enough to catch your eye last week, Mr. Speaker, that we might learn something from our experience in controlling Antarctica and Outer Spage. I will not elaborate on that now.
I wish to deal very briefly with a particular problem which has emerged. The hon. Gentleman has indicated various methods by which we might control the ocean floor. There are some very serious problems about defining where the ocean floor begins. What is already under territorial jurisdiction? How much has already been lost to the common heritage of mankind? It used to be thought that territorial jurisdiction extended to a three-mile limit from the territorial tidemark. That has been extended, and fairly widely accepted, as 12 miles. While
1232
there was no temptation to claim any more, that sufficed. When the ocean became susceptible for exploitation, further agreements contained in the Geneva Convention of 1958 gave a coastal state sovereign rights over the Continental Shelf, which it defined as sea area up to a depth of 200 metres, and beyond that —as the hon. Gentleman said, this was something of an afterthought—to an area where the depth admits of exploitation of the natural resources.
That was not so bad while exploitation was not possible at any great depth. But now it has given rise to claims by many states to erect "keep out" notices half way across the ocean, on the argument that the whole of the ocean is adjacent to the states, along its coast up to the point in the middle where it becomes adjacent to the state opposite. As the hon. Gentleman pointed out, this could give Portugal a claim to virtually half the Atlantic Ocean. We have had no complaints from states with a large coastline, particularly if their technological resources are well advanced. It has become a gratuitous bonus for the developed countries as against the underdeveloped and for states with coastlines as against land-locked states. The danger is that if we delay in taking action, these claims will not only be talked about by international lawyers, but will be advanced, and, once they are advanced, national dignity will be at stake and it will be too late to withdraw them.
As I said, a great deal of thought has gone into the problem. I would like to refer briefly to a suggestion advanced in June by Professor Auerbach, an influential member of the United States Marine Science Commission, at a conference on the Law of the Sea in Rhode Island. I do this in no sense of criticism. I should not like at this stage to be thought of as either approving or disapproving of his suggestions. I cast no reflection on his motives. But it is important that the House and the public in this country should know what is being said, and the implications of it, by an eminent and learned authority who has carefully thought about this subject at great length, and who is undoubtedly likely to be listened to very carefully by the United States Government.
Professor Auerbach suggests that we should leave the depth of 200 metres as defining the limits of territorial waters,

1233
and that from there up to a depth of 2,500 metres there should be an intermediate zone where any state which can exploit the area may stake out a claim, on the basis of "first come, first served", and on payment of a fee to an international authority, such fee to be used for internationally agreed purposes. It would be open to that state to exploit purely for its own purposes. He goes on to suggest that the state which exploits in that way should be responsible internationally for policing that area, which means that that state would have virtual sovereign rights over the area involved.
Now we can calculate roughtly that the ocean floor up to a depth of 2,500 metres is about one-fifth of the total sea area, or one-seventh of the total area of the globe. The proposal is to throw open to a scramble an area equal to approximately half the total land area of the earth, which has been estimated to contain about 180 billion barrels of oil and one million four hundred thousand billion cubic feet of gas. We the peoples of the earth are being asked to renounce our rights to an area greater than the combined areas of Europe and Asia.
I cast no reflection on Professor Auer-bach. I am sure that he believes in good faith that this is the best deal that we can get, and it is infinitely better than to throw it open to a scramble without any conditions at all.
Mr. Robert Maclennan: I share my hon. Friend's concern about this matter, but would he agree that one consideration of any new legal régime for the exploitation of the sea bed must be that it does not hinder in any way its exploitation and that we are enabled to develop it as quickly as possible?
Mr. Archer: I agree completely. There are enormous problems in this matter. One wishes that one had time to discuss them.
I should like to know the views of my hon. Friend the Minister of State on that kind of suggestion and this kind of problem. All that we have heard so far from the United Kingdom representatives or the ad hoc Committee of the United Nations is that this is a very difficult problem and requires a great deal of thought. I do not seek to disagree with that. But unless something is done
1234
quickly, there will not be anything left to think about.
Several Hon. Membersrose—
Mr. Speaker: Order. For the benefit of those who have not heard Mr. Speaker from time to time today, may I point out that we are not on the Consolidated Fund Bill but on timed Adjournment debates. The Minister will rise at 2.45 p.m.
2.40 p.m.
Mr. Emlyn Hooson: I will not attempt to repeat any of the admirable and informed arguments which have been put forward by the hon. Member for Liverpool, Wavertree (Mr. Tilney) and the hon. Member for Rowley Regis and Tipton (Mr. Archer). All I need say is that in retrospect it might in time prove that this short debate of three-quarters of an hour duration might be the most important of this Session.
Very few members of the public in this country, or in any other country, are aware of the enormous importance of the sea bed for the future of mankind, or are aware of its importance economically, which was admirably discussed and expounded by the hon. Member for Wavertree, or, as developed later by the hon. Member for Rowley Regis and Tipton, its strategic importance. The whole future of mankind could depend upon the way that we as a world civilisation decide to develop and control the enormous resources of the sea.
The temptation to a Power concerned with military aggrandisement on the ocean bed is obvious. If there were rocket bases hidden away in the mountain recesses under the sea in the Atlantic—or the Pacific, for that matter—the strategic advantage to the country planting them there are obvious. From the economic viewpoint, the country which can first master the technique of developing the undersea resources could set in train a vast Klondyke, as it has been referred to.
What I am concerned with as chairman of the all-party World Government Group, of which the two hon. Members who have already spoken are among the most prominent members, is the attitude of Her Majesty's Government towards this problem. Whereas the public are in ignorance largely of its great implications, the Government are not.

1235
I would like to see the Government of this country, no matter what its political complexion, take the initiative in this matter. Malta has already raised it at the United Nations and we had the advantage of hearing Dr. Pardoe, its ambassador, address our Group earlier this year. We should like Her Majesty's Government to appraise our people of the importance of this matter. We should like to see the Government taking the initiative, because surely, if the United Nations is not to control this development, it will be a free-for-all with devastating consequences for mankind.
I am sure that the Minister is deeply sympathetic to the point of view which has been expressed here today. What we should like from him is an assurance that the Government, not only in words, but by deeds, will take the initiative in this matter before it is too late. In five years' time, it may well be far too late.
We know of the deep-sea experiments, and the experiments off the Californian coast are already in train. No doubt other countries are experimenting in this way. What would be of most concern to us today would be to have absolute assurances from Her Majesty's Government that something concrete has been done in the matter and that this country, with its great respect for law and order, its appreciation of the need for this and its great knowledge as a maritime nation of all the issues involved, is taking the initiative to bring order into chaos.
2.44 p.m.
The Minister of State for Foreign Affairs (Mr. Goronwy Roberts): I am extremely sorry that I cannot give way to my inclination to enable other hon. Members to take part in this extremely important but, unfortunately, very brief debate. I know that there are other hon. Members present who have substantial contributions to make, but I wish to give a general picture of the attitude of Her Majesty's Government to this extremely important question before the House passes on to the next debate.
This subject, which has been put down by the hon. Member for Liverpool, Wavertree (Mr. Tilney) and by my hon. Friend the Member for Rowley Regis and Tipton (Mr. Archer), is one of
1236
rapidly growing interest and importance. It is a subject on which the United Nations has been engaged since last September, when the Maltese delegation first raised it. The Maltese delegation called for a treaty to reserve exclusively for peaceful purposes the sea bed beyond the limits of national jurisdiction and to provide for the use of its resources in the interests of all mankind. The degree of interest in this House has been shown by the fact that more than 120 hon. Members have put their names to the Motion which the hon. Member for Wavertree so rightly quoted.
This is a subject which has caught the imagination of delegates at the United Nations. It is well suited for discussion there, not only because of its intrinsic universal nature, but because it is a logical sequel to the discussion on Antartica and Outer Space which led to the signing of the Antarctic Treaty in 1959 and the Outer Space Treaty in 1967.
The subject concerns an area which, until recently, had not been considerd in an international forum. The Ad Hoc Committee which was set up last December was the result of the initiative of the Maltese delegation certainly, but it was co-sponsored vigorously by the United Kingdom. The United Kingdom, therefore, was actively associated from an early stage with the present attempt to find a solution to this important problem.
The Ad Hoc Committee of the United Nations has been asked to study the peaceful use of the sea bed and the ocean floor beyond the limits of present national jurisdiction. The Committee will hold its third meeting in Rio de Janeiro during August and will report to the next General Assembly. The Ad Hoc Committee has already done much useful work. In the session which began on 17th June, the discussion centred around two issues: whether the ocean floor should be reserved for peaceful activities; and secondly, what are the resources of the ocean floor and how they should be exploited.
The second of those subjects was considered in detail in a technical and economic working group of the Committee, and I should like to say something about the tentative conclusions reached by the working group in its progress report. We

1237
have all heard of the great potential wealth which exists on the sea bed as a whole, both the Continental Margin and the deep ocean floor which lies beyond— the oil, gas, manganese and other minerals, the commoner minerals such as phosphates and, of course, the potential food supply, to which the hon. Member for Rowley Regis and Tipton referred.
I must emphasise that in this debate we are not concerned with the resources of the Continental Shelf. All the commercial drilling operations in the world are being carried out on the Continental Margin within the existing limits of national boundaries. The deepest well so far producing gas in the North Sea is in only 100 metres of water and there is no commercial exploitation anywhere in depths greater than 200 metres.
Through such operations and by other means, we know a certain amount about the shallower parts of the Continental Margin and it is reasonable to suppose that in a few years' time it will be technically possible, as has been said, to exploit oil, gas and, possibly, other minerals at greater depths. The ocean floor beyond the limits of national jurisdiction lies at very much greater depths, down to 6,000 metres or even deeper. It would be wrong at present to pin too many unqualified hopes on the exploitation of the deposits of this area for use by man. The plain fact is that a great deal more research and exploration must be carried out before we really know what there is there and whether it can be exploited. It is not just the United Kingdom which recognises this fact. The Technical and Economic Working Group of the Ad Hoc Committee has recognised this and recommends that priority should be given to research and exploration on the deep ocean floor.
There is the question of the development of the technology necessary to exploit the resources. The Working Group has been unable so far to do more than express cautious optimism that such development in technology would take place. It has, quite rightly, distinguished between technological capacity and the economic feasibility. In two or three years' time exploitation will be technically possible in depths greater than 200 metres, but it may be several more years before the high costs of such exploitation
1238
make it commercially viable. We all recognise that vast investment is necessary for the development of the relevant technology and that without an assured return for such outlay people—individuals, organisations, states—will be unwilling to spend enough money on it.
This brings us back to the primary need, which is for a much greater effort on research and exploration of the deep sea bed so that we know what it is we are after and where it lies, and it is the view of the Government that it is of first importance in this connection that it should be established in the United Nations that research and exploration over the whole area of the ocean floor should be open to all. The Government are playing a full part in the work of the Intergovernmental Oceanographic Commission of U.N.E.S.C.O. which is promoting research in the exploration of the sea bed. This is the first priority, and I think we are right in pressing this forward. Indeed, there is international agreement that this is the first priority.
I have spoken in some detail about this report because it shows that the conclusions which the Government were reaching in their own thinking are shared by the international community as a whole, namely, that really significant exploitation of the deep sea bed is something like a decade or more away.
Mr. Evan Luard rose—
Mr. Roberts: I have very little time.
Mr. Luard: My right hon. Friend is devoting a great deal of time to the deep sea bed. Would he not agree that there are very substantial areas of the ocean which are beyond the 200 metre limit and, therefore, may very shortly be exploitable, and about which, therefore, it is urgently necessary to reach agreement, and that in many of those areas exploitation may be possible much more quickly than he is suggesting?
Mr. Roberts: I entirely agree. I thought it right to give a general picture of the possibilities—the first case, we may say, which is fairly immediately exploitable, and then there is, of course, the rest of the ocean, exploitation of which lies a little further away, but, nevertheless, is of urgency in regard to our coming to an agreement about how to organise the exploitation.

1239
I think we may all agree that it would be unwise to rush into any particular form of international arrangements for exploitation with no more than a vague idea of what is at stake, but I want to say that the United Kingdom has from the start taken, and will continue to take, a stand on the general principle that there should be international arrangements— international arrangements which are effective, impartial, not unduly restrictive, say, of research, and governing any exploitation of the deep sea bed, and that those international arrangements should be agreed as soon as ever practicable. That is the first point of principle on which, I think, the House would like to have my assurance. Our posture is to work for an international arrangement in regard to this extremely important matter.
I should like to add this. We think it is of particular importance that we should keep in mind the possibility of the use of these resources for the benefit of the less developed countries. How far this can be done will only be known when we know more about the resources and how they can be used.
I particularly agreed with the point made by the hon. Gentleman about the position of the landlocked States. Naturally, they have an interest in there being an international posture towards the possibilities of this exploitation. It is in the belief that such resources as there are in the ocean floor outside national jurisdiction should be available to mankind as a whole, that the Government have decided that they will support the view, that claims to sovereignty over those regions should be prohibited. This is a vital first step towards ensuring that national interests are not the only ones to be taken into account on the ocean floor, which covers, as we have heard, the major part of the globe. Moreover, the Government are convinced that activities on the ocean floor must be conducted in accordance with the Charter of the United Nations.
May I now turn to the other main issue which confronts us in discussion of the future of the ocean floor? This is the question of its peaceful use. I need hardly remind the House that it is our policy, the policy of the Government and this country, to work for international
1240
agreement on arms control measures, wherever these will contribute to the promotion of international peace and genuine security. My right hon. Friend the Minister of State informed the House on 22nd July that we have already proposed to the 18-nation Disarmament Conference in Geneva that the arms control problems of the sea bed should be considered by the Committee. I am glad to say that both the United States and the Soviet Union have informed the Ad Hoc Committee that they also take this view. We shall, of course, examine very carefully any proposals which might affect the legitimate security interests of ourselves and our allies, and we shall keep this factor very much in mind in discussion in the Ad Hoc Committee, but we hope it will be possible to reach agreement on a recommendation by the Ad Hoc Committee which will meet these requirements satisfactorily.
I should like to say something about the scope of the study of the ocean floor now under way in the Ad Hoc Committee set up by the United Nations.
Mr. Speaker: Order. I must protect back benchers. I remind the Minister that he should sit down at three o'clock.
Mr. Roberts: Thank you, Mr. Speaker. It is a suspended sentence to death, and I have two minutes in which to deal with this very interesting part of the subject.
It is clear that the study does not extend to the waters of the oceans and cannot, therefore, interfere with the existing fishing rights or with the traditional freedom of navigation of the high seas. We have no time to discuss the various covenants of the Geneva Conference, 1958, but I am sure that the hon. Gentleman follows implicitly what I mean.
After the area of the whole sea bed involved as my hon. Friend the Member for Oxford (Mr. Luard) mentioned, the resolution refers to the sea bed
"… beyond the limits of present national jurisdiction."
It is, of course, debatable where these limits lie. It is a very complicated legal problem, and is related to the whole question of the law of the sea.
In dealing with the question of the boundary of the ocean floor, we should not forget that all parties agreed that the

1241
Outer Space Treaty could be usefully signed without agreement on a definition about outer space. But no one would disagree that there is a vast area of ocean floor outside national jurisdiction, and its. delimitation will have to be decided after very careful study.
Mr. Speaker: I am grateful to the right hon. Gentleman for ending his remarks on the hour.

ROYAL ASSENT
Mr. Speaker: I have to notify the House, in accordance with the Royal Assent Act, 1967, that the Queen has signified Her Royal Assent to the following Acts:

1.Appropriation Act, 1968.

2.Finance Act, 1968.

3.British Standard Time Act, 1968.

4.Health Services and Public Health Act, 1968.

5.Sewerage (Scotland) Act, 1968.

6.International Organisations Act, 1968.

7. Social Work (Scotland) Act, 1968.

8.Hearing Aid Council Act, 1968.

9.Highlands and Islands (Development) (Scotland) Act 1968.

10.Caravan Sites Act, 1968.

11.Adoption Act, 1968.

12. Theatres Act, 1968.

13. Friendly and Industrial and Provident Societies Act, 1968.

14. Swaziland Independence Act, 1968.

15. Overseas Aid Act, 1968.

16. International Monetary Fund Act, 1968.

17.Hovercraft Act, 1968.

18. Theft Act, 1968.

19. Ministry of Housing and Local Government Provisional Orders onfirmation (Blackpool and Stourbridge) Act, 1968.

20. Ministry of Housing and Local Government Provisional Order Confirmation (West Kent Main Sewerage District) Act, 1968.

21.Crosby Corporation Act, 1968.

1242

22.Greater London Council (Vauxhall Cross Improvement) Act, 1968.

23. Ely Ouse-Essex Water Act, 1968.

24. Great Northern London Cemetery Company Act, 1968.

25. Hounslow Corporation Act, 1968.

26. Lancashire County Council (General Powers) Act, 1968.

27. Mersey Docks and Harbour Board Act, 1968.

28. Mid-Glamorgan Water Act, 1968.

29. Port of London Act, 1968.

30. Medway Water (Bewl Bridge Resevoir) Act, 1968.

31. British Railways Act, 1968.

32. British Railways (Mersey Railway Extensions) Act, 1968.

33. Cheshire County Council Act,1968.

34. City of London (Various Powers)Act, 1968.

35. Durham County Council Act,1968.

36. Greater London Council (General Powers) Act, 1968.

37. Leicester Corporation Act, 1968.

38. Greater London Council (Money) Act, 1968.

ADJOURNMENT
Question again proposed:—

TANZANIA (GOVERNMENT AID)
Mr. Speaker: I would remind the House, as I have done several times in connection with previous debates, that this debate will last for exactly half an hour.
3.2 p.m.
Mr. Alexander W. Lyon: I am grateful for the opportunity to raise this subject, even though I regret that we have only half an hour in which to discuss it. As I am anxious that my right hon. Friend should have 15 minutes in which to reply, and also that some of my hon. Friends should be able to take part in the debate, if that is possible, I shall keep my remarks short.
My reason for asking for this debate is that when the subject was raised by

1243
some back benchers, during the Committee stage of the Overseas Aid Bill, the Minister said that he hoped that one back bencher would be able to initiate a debate on the subject so that he could explain the decision at greater length. I am anxious that he should do so. In passing, I hope that when, in future, an important policy decision such as this is made, the Minister will make it known by a statement in the House rather than by a Written Answer, as my right hon. Friend did on 20th June, because an oral statement gives hon. Members an opportunity immediately to make some observations.
I am interested in the wider aspect of the matter, and perhaps I should, first, refer to the way in which the decision was reached. It started a year ago, when the Tanzanian Minister of Finance gave notice that after this year Tanzania did not propose to pay anything towards the pensions of ex-civil servants who had been employed in Tanzania prior to independence in 1961. The reason, which in my view is right and just, was that those civil servants who had been employed before that date were really the responsibility of the ex-Imperial Power and not of the newly developing nation. Anyone who stayed there and joined in the act of nation building to some extent was the responsibility of the new nation, but it was, in my view, wrong that the larger burden should ever have been put on the new nation. But it was the policy of the then Government and of preceding Governments that wherever a colony was given independence it should take upon itself this responsibility.
I understand we are unique in the list of ex-imperial Powers in providing for civil servants in this way. Most of the ex-imperial Powers assume the burden themselves directly. That is the way in which we should have done it and the way we should do it from now on. I am glad that the President of Tanzania has raised this issue so that there can be a reconsideration of the policy of the Government and perhaps a change of policy in future when economic conditions permit it.
Although this is a matter of about £1 million, which, in terms of the British Budget is fairly insignificant, in terms of
1244
Tanzania's budget it represents a very considerable slice of gross national product. By comparative terms in this country £150 million worth of public expenditure would be represented, which was the amount discussed for civilian home expenditure in the public expenditure cuts in January. When we think of all the turmoil caused in this country by those cuts, we should think of the effect on Tanzania of finding about £1 million.
What interests me is why we have decided, in view of the fact that Tanzania refused to pay this £1 million in pensions, to devote about £1¼ million in overseas aid. What we are trying to do is not to penalise Tanzania, but simply to compensate out of our payments in aid the amounts which will fall to the Exchequer if we are to pay pensioners from Tanzania. In the restricted area, therefore, of the Tanzanian situation it was not necessary to refuse the whole of the aid programme.
It is only by accident that the figure was about equal because, until the breaking off of diplomatic relations, Tanzania had an aid programme of about £4 million and there was a proposal to increase the amount by a loan or a grant to £7½ million. This was still earmarked for Tanzania until this decision was made in June to break off any further aid programme. It therefore seems that Tanzania has lost not only £1¼ million worth of aid, but the whole of the aid programme which would have been theirs on the resumption of diplomatic relations which, happily, has taken place.
It is fortunate that Tanzania has acted so responsibly in reply to the breaking off of the aid programme that the resumption of diplomatic relations has gone ahead none the less. Therefore, on the narrower talks there is something to discuss, but on the broader aspect why cannot we get rid of payment of pensions to ex-civil servants from the overseas aid budget, where in effect it is because some allowance is made in the granting of aid to overseas territories for the fact that they are paying something to overseas British civil servants in their country?
As the payment to ex-British civil servants is about £4 million, why can we not take that off the overseas aid budget and give it where it should be given, under the Foreign Office Vote? That is where the matter ought to lie.

1245
It would be a much more realistic assessment of our overseas aid programme.
I am sure that those who support such a programme—and there are many in this country—think that when we are giving overseas aid we are giving it to children who are suffering from malnutrition, or to peasant farmers who cannot make a living, not to civil servants in this country. It would be better in trying to achieve the U.N.C.T.A.D. target if we did not include this in our overseas aid budget. I hope that the Government will reconsider the whole position.
I realise that there are two countries, and two alone, which pay out more in pensions than they get in aid. They are Hong Kong and Bermuda. Therefore, if we made this change of policy and included those two countries, it would be necessary to make a reduction in aid to some other poorer country. I do not think that it necessarily follows that this should be so. We could make those two exceptional cases still exceptional and deal with the other countries where the balance could be met in this way, so that in future, when economic conditions improved, it would be possible further to stimulate the aid given by the Ministry of Overseas Development and reduce the amount which goes in pensions. I hope that this policy decision can be made now so that when economic conditions permit we shall have a much more realistic aid programme.
Several Hon. Members rose—
Mr. Speaker: Order. I remind hon. Gentlemen who seek to take part in this debate that we are not on the Consolidated Fund. This is a half-hour's debate and the Minister has to speak.
3.11 p.m.
Mr. Patrick Wall: I rise briefly to support my hon. Friend the Member for York (Mr. Alexander W. Lyon). Two matters arise. The first concerns Anglo-Tanzanian relations which could have been better than they have been. Personally, I have a great respect for Dr. Julius Nyerere and for the way he tried to maintain a balance between East and West in his country. I am glad that diplomatic relations have now besn resumed. What we are discussing is the basic principle of British aid being given to a newly independent country to pay for the pensions of British
1246
colonial civil servants who served that country before independence.
I have always thought—I believe that I have the support of a number of hon. Members on the back benches on this side; I do not pretend for a moment that this is Opposition policy—that aid when given to a country should not normally include the payment of pensioners pre-independence. I believe that it would be very much better if the responsibility for paying these people were taken over by the British Exchequer. Not only would it be better from the point of view of the developing country, which obviously is under political pressure to stop any payment for pre-independence expenses. It would also be better for the British pensioner, who would have his security maintained by his own home Government.
This would lead to extra expense on the Exchequer. As the hon. Member for York has suggested, this could be met by deducting that amount from the aid bill to the country in question. The net result would be much better security for our pensioners and much better relations for the developing country. I know that the Minister will not be able to make a policy statement this afternoon, but I hope that the two Front Benches will give this matter of principle serious consideration, as I believe that it would greatly help Commonwealth relations.
3.12 p.m.
Mr. Tony Gardner: I wish to add only two brief points to the case already made by my hon. Friend the Member for York (Mr. Alexander W. Lyon). I am glad that my hon. Friend the Parliamentary Secretary is here, because he will remember that last year I questioned him closely about this whole matter of pension and compensation payments. We had a discussion then. In view of the financial difficulties then facing the country, we decided not to pursue that discussion.
I am concerned that what has happened in Tanzania may have repercussions in other countries. In view of the sums involved—Kenya's total commitment is about £10 million—I have a fear that this will spread. I hope that my right hon. Friend will take this opportunity to look again closely at the problems involved.

1247
I appreciate that the legal situation is clear. All these countries, on obtaining independence, undertook to meet these various commitments. It should be said in fairness that a country fighting for independence would perhaps be prepared to accept terms that its people might later find not too acceptable. It is not sufficient to argue that these decisions were willingly accepted. People advise, and the officials concerned advise, the then Governments in the newly-independent countries about the kind of terms that ought to be given.
I am sorry that we have imposed on these countries a burden, a standard of living and a pension requirement out of all proportion to the normal standard of living and the kind of service conditions which their own servants today can expect. For this reason, I hope that my right hon. Friend will look at the matter again and try—certainly not to reduce our total aid budget—but to get these sums transferred to where they clearly belong—to the Treasury, the Commonwealth Office, or the Foreign Office— which are responsible for the payment of British nationals and which in some cases recognise South African and Rhodesian Nationals—and not let it remain a burden on the very limited resources of the countries concerned.
3.15 p.m.
Mr. Frank Judd: I support what has been said by my hon. Friend the Member for York (Mr. Alexander W. Lyon). It strikes me that this issue is particularly important following the latest U.N.C.T.A.D. At that conference, a new target in aid programmes was set for the developed countries which meant that, far from fulfilling our target, there will have to be an increase of nearly 10 per cent. in our aid programme to meet it.
As there are to be set against the programme which we are already undertaking contributions from the developing countries towards pensions amounting to about £12 million, there is still more ground to be made up. Anyone looking objectively at overseas aid and development programmes will agree that it is wrong in principle to regard payments of this kind as part of aid and development in any proper meaning of the term.
Second—this is a point which I have touched on in the House before—in any
1248
order of priorities for this country's overseas aid and development programme we should give high consideration to the needs of Tanzania simply because in recent years the Government of that country have made in the Arusha declaration a great breakthrough in the whole concept of development by showing that, if a country is to progress, outside assistance has an important part to play but the final effectiveness of the outside assistance depends on the will and determination of the people themselves.
Following the Arusha declaration, there have been imaginative and courageous strides in Tanzania in the direction of generating self-growth within that country. For this reason, those of us who wish to support the British Government in their aid and development programmes are disappointed that, as a result of the pensions issue, we are not giving to a country which is giving a lead the sort of encouragement which we should give.
3.17 p.m.
The Minister of Overseas Development (Mr. Reg Prentice): This brief debate is an interesting illustration showing that powerful arguments can be put by hon. Members on important subjects with far more brevity than is the usual custom. I am glad that the House has had a chance to debate this important matter, however briefly, since it is one to which we ought to direct our attention.
I am grateful to my hon. Friend the Member for York (Mr. Alexander W. Lyon) for raising it for another reason, namely, that some of the comment which has followed the cessation of aid to Tanzania, comment in the form of letters to the Press, letters which we have received at the Ministry, and in other ways, has suggested that in some way or other we reacted in a vindictive way as a sort of retaliation against what Tanzania had done. I wish to make perfectly clear that there was no question of spite or vindictiveness. It was purely a matter of arithmetic.
Given the general policy on who should have the liability for pensions—I realise that this is really what the discussion is about—what happened was that Tanzania repudiated a pensions liability of about £1 million and Her Majesty's Government, naturally, assumed that liability. The hon. Member for Haltem-

1249
price (Mr. Wall) mentioned the security of pensioners. The fact that we did assume liability with no interruption whatever in their pension payments, ought to reassure them.
It was a liability which had to be discharged, things being as they are, at the expense of the aid programme. Therefore, it was right—I do not imagine that anyone disputes this—that the £1 million had to be found at the expense of Tanzania, the country which had made the decision, and not some other country which continued to discharge its pension liability.
My hon. Friend the Member for York asked whether there was not also a possibility of our negotiating a further development loan for Tanzania following the resumption of diplomatic relations. That possibility did exist, as some preliminary thought had been given to it in the past when diplomatic relations existed. But, if that is on one side of the equation, on the other Tanzania repudiated not only the payment of pensions, but also the repayment of a loan it had received from us in relation to the pension liabilities. Therefore, there are matters on both sides of the equation which are difficult to quantify exactly, and that is why I said "about £1 million".
But it is not the case that our reaction is out of proportion to what has happened. During the period of about a year between the time when Tanzania originally said that this was its intention and the speech by Mr. Jamal, in the Tanzanian Parliament, a few weeks ago, in which it was finalised, we had made clear to the Tanzanian Government that we should need to react by the withdrawal of our development assistance. They knew that this would be the consequence, and made the decision knowing that. It was Tanzania's decision.
The second point to make clear to the House is that we have decided to give effect to the decision gradually. The experts serving in Tanzania—between 600 and 700 in various capacities—are not being withdrawn. They will serve out their contracts, but will not be replaced when the contracts end. It would be open to the Government of Tanzania, if they wished, to use some of the money they are saving on the pensions bill by continuing to employ some of those people, and I believe that it is their intention to offer
1250
continued employment to some at Tanzania's full expense, without any assistance by this country.
Students and trainees at present in Britain are not being sent home, nor is financial support being withdrawn for the remainder of their courses, but no new ones can come under this arrangement. But if a student were to get a place at a British university, for example, it would be open to the Tanzanian Government to use some of the money they have saved by withdrawing from the pension liability to provide the finance that in other circumstances might have been provided from here.
I agree with those who have expressed their admiration for the Government and people of Tanzania. I have a great deal of personal admiration for President Nyerere and a great deal of sympathy and support for the spirit of the Arusha Declaration. I am sorry that these recent developments had to happen, but I repeat that it was a decision by the Tanzanian Government the consequences of which were inevitable, given the general policy.
I am very glad, as I am sure every hon. Member is, that Tanzania has resumed diplomatic relations with this country, but that does not affect the issue we are discussing, and I do not think that the Tanzanian Government would expect it to. It is clear that they were moving towards a decision to resume diplomatic relations at the time when Mr. Jamal made his speech a few weeks ago.
The general issue here, which is the real point in dispute, is why this country considers its ex-colonies responsible for the pension liability. The roots lie in 19th century law and theory as to the proper relationship between this country and its colonies. This has been followed in practice in the post-war period by Governments of both parties when countries have become independent, in that we have expected them to assume all the assets and liabilities of the imperial Government, and to continue to pay pensions, although in a great many cases we have made loans specifically to help them with the pension burden, or development loans have taken that into account along with other factors.

1251
As to whether this is right or wrong in principle, it is very difficult to be certain. It can be argued, on the one hand, that the officers with whose pensions we are concerned have given great service to the countries in which they have worked and have contributed to their strength. This is illustrated by the fact that so many of them were invited to stay on after independence. In the Tanzanian Parliament, Mr. Jamal paid an eloquent tribute to those concerned in that case. It may be argued, therefore, that the pension liability properly rests with the Government of the country concerned.
On the other hand, I think we should all sympathise with those in the countries concerned who, in view of their development problems and the problems relating to the living standards of their people, resent the need to tax their own people in order to pay pensions to persons who, in many cases, have returned to Britain and are enjoying a middle-class British standard of living here which is out of all relationship to the standard of living of the peoples of those countries.
I think that if we were starting anew to make a decision about what would be right most of us would take the view that we ought to follow the practice of other ex-colonial Powers and assume the pension burden ourselves. But we are faced here with something that is in existence and has existed under both Governments for many years, and we have to consider what would be the practical effects of making the change. If Britain were to take over this liability, then, given existing economic circumstances, it would have to mean an equivalent reduction in the development aid budget. There is no alternative to that in present circumstances.
Some of my hon. Friends have said that this should be on the Vote not of the Ministry of Overseas Development but of another Ministry. But that does not affect the main issue. The money would need to be found. Because of the kind of changeover it would be, there would have to be a switch of £12 million or more—it depends on how one defines this, and there are a number of borderline issues—and, therefore, a reduction in the development aid budget at the
1252
same time as we were taking over this liability.
It we did it, the decision would be welcomed by most of the Governments concerned. It would probably be welcomed by the pensioners, as the hon. Member said. It would be welcomed by hon. Members on both sides of the House, and by people outside. But we are bound, nevertheless, to look at the total question and consider what would be the total effect of doing it.
The studies that I have made of it—I have given the matter very close study— lead me to the conclusion that there would be a net loss of real development. There are a number of reasons for this. One is that there are a few countries which are getting less aid from us than the pension liability represents. My hon. Friend mentioned Bermuda and Hong Kong. It would also apply to Singapore if it were not for the fact of the special aid related to the defence rundown, and in certain circumstances other countries might be on the list. So some countries might be relieved of the burden at the expense of poorer countries.
Also, certain kinds of aid are of such a nature that it would not be possible in practice to cut them off at a particular date. For instance, one would not want to interfere with the scholarships of students who are in this country, with the volunteer programme, with the people in posts in the Overseas Service Aid Scheme, and so on. In other words, the kinds of aid that could bear this cut would be limited. Therefore, in imposing the cut one would need to alter the pattern of aid as between countries as well as between one type of aid and another.
Then there is the possible effect on the developing country. Suppose there were a reduction of technical assistance. Suppose the country was then in a position where we might hope that by saving money on pensions it would be able to employ technical assistance people itself. Would it be able to sustain a position in which it paid more to a British teacher than to a local teacher? Would the pressure resulting from that lead to a reduction in the number of experts being employed? All these questions arise, and they are matters of judgment.

1253
Having given this close study and taken a lot of advice, my conclusion is that the balance of advantage lies with keeping the existing situation, with all its falts and drawbacks, because there would be a net loss of development and, therefore, a net loss in the living standards of those we are concerned with, if we made this change.
Mr. Alexander W. Lyon: Before my right hon. Friend sits down—
Mr. Deputy Speaker: Order. The right hon. Gentleman has sat down.

ROAD DEVELOPMENTS, BOURNEMOUTH
3.30 p.m.
Sir John Eden: I am grateful for this opportunity to discuss the effect on property in Bournemouth of current road developments in the town. At a cost of several millions of pounds and involving the destruction of hundreds of properties, a new main highway is being driven through the heart of the town. At the moment, just above the town centre, many fine houses are being pulled down, giant bulldozers are carving their way through wooded hills and massive viaducts in steel and concrete are reaching out across the valleys.
As the road sweeps on through Bournemouth, its citizens are wondering where this will end and whether desecration on such a scale could not have been avoided. Property owners and tenants ask who will be the next victim. Will it cut back across the Bourne Valley and forge its way through the tranquillity of Talbot Woods? Or what other route will it take to link up Bournemouth with Poole and the rest of Dorset?
All the forecasts, based on sound statistical evidence, indicate an enormous increase in traffic between now and the rest of the century. This will be generated in the Bournemouth conurbation, the population of which is bound to expand as well us coming into the area from outside by means of vastly improved motorways. From a study of the figures it is clear that, if nothing were done, life would grind to a halt in Bournemouth with virtually no movement possible within or in or out of the town.
1254
The borough engineers and others have given careful thought to this problem and to possible solutions. They have been exhaustively explained in the Land Use and Transportation Study published in April last year. It is a comprehensive report. It brought together the results of a major survey of the planning and transportation problems of Bournemouth, Poole, Christchurch and the neighbouring parts of South-West Hampshire and South-East Dorset.
The basic cause for all this research, as far the major physcial upheaval itself, was explained last March by the Parliamentary Secretary in replying to a similar debate. He gave figures for the nation as a whole. He said that there were now 9 million private cars and that in a few years this could be more than doubled, bringing some 20 million privately-owned vehicles on to the roads. Clearly, something dramatic must be done. But I repeat the warning he gave, for it will be echoed like a cry from the heart by many of Bournemouth's residents today. He said:
"We have to see to it that the hearts of our old cities are not torn out in the interests of the motor car."—[OFFICIAL REPORT, 8th March, 1968; Vol. 760, c. 941.]
Bournemouth is anything but an old city. It has a short history but already it is one of astonishing development in so many human activities—entertainment, commerce, education and welfare and not least in town planning. In that aspect, it has moved not just with but ahead of the times. Bournemouth's people are justly proud of its progress and there is widspread understanding that it cannot stand still. None the less, this should not blind us to the fact that, for the individual whose home is to be destroyed and the pattern of whose life is to be shattered, these structural changes have the greatest consequences. It is on that, the human aspect of the problem, that I want to concentrate.
I am sure that, in the case of these new roads in Bournemouth, all the procedures have been properly and humanely carried out. I imply no lack of consideration on anyone's part. But I have seen what misery, worry and heartache such a scheme can bring and I ask whether there is not something more that could be done to lessen the burden and ease the blow. I have four

1255
suggestions and I ask the hon. Gentleman to give them most careful consideration.
My first point concerns compensation. I have no doubt that the district valuer is as fair as possible in assessing the value of properties to be taken. Also I accept the need to safeguard the interest of other tax and ratepayers. But some additional consideration ought to be made because of the fact that, in order to meet what is considered to be the best interest of the community as a whole, certain individuals are forcibly to be deprived of their homes.
It is not enough to pay market value, however generously assessed. Some payment ought to be made over and above that to compensate in some way for the loss of a home. Further, since most people—particularly those who have lived in the same place for many years— wish to remain in the locality that they know best, full allowance should be made for the possible shortage there, and consequential higher cost, of comparable alternative accommodation. People—old people especially—do not always want to move out of the area that they know. But alternative comparable properties are usually impossible to come by. A major new road taking many new houses— usually in one fell swoop—must lead to an increased demand for the remaining desirable properties available in the district. If the compensation terms are improved in this way the impact of change will be reduced.
Secondly, there seems to be a good case for introducing all the beneficial elements of the compulsory purchase procedure at the time that the notice is served. I believe I am right in saying that if the council agree with the householder to buy the property in advance of the time when compulsory acquisition would have to be made, the council's obligation would end on having paid the purchase price. But if it had had to serve a compulsory purchase order on the householder, in addition to the purchase price the council would have met th legal fees and paid towards the cost of disturbance and removal. There should not be this distinction. All householders whose homes are to be taken should, as far as the council is concerned, be treated on the same basis.
1256
Thirdly, I am particularly concerned about the impact on elderly people. It is terrible when the home of a lifetime has to be flattened for a road, a car park, or any other reason. For a person of 60, 70 or 80 years of age it can never be replaced. No amount of compensation can ever make up for what has gone. Sometimes if just a few more years' grace would be allowed, it might be enough to see them out. Sometimes that few more years' grace might well be possible without in any way harming progress with a particular project.
I know that these are hard decisions for all concerned, and I have been trying to devise a way round them. One possible way out would be for the council to acquire properties in the affected neighbourhood which they could then lease out for short periods in particularly deserving cases. Of course, there are dangers in such a step, but to my mind the benefits would be even greater. The availability of some kind of "buffer-state" in housing would give councils greater flexibility and enable them to meet particular individual needs. Some of this property, bought in the open market, could also then be sold in exchange for houses that the council is to demolish. This would inevitably involve the council in a programme of expenditure in advance of the actual development, but to my mind it is a proper area for council activity, and it would certainly enable it to meet special cases of need.
Where there is a major development of this kind, extending over many years, the council should do its best to give what help and assistance it can to those affected. I would like it to set up a displaced residents advisory service—perhaps a better title could be devised, but that describes my objective. This would be particularly helpful to old people who are worried about the whole thing, and do not know where to turn for help and advice. It is not good enough to let them find for themselves some alternative property or accommodation. A special service of this kind would be invaluable. It would have to be quite impartial, and would act as a clearing house, giving up-to-date information on all available properties in the borough.

1257
It could also help with legal aspects, documentation and so on. Much of this work can be done, and is done, most ably by the Citizens' Advice Bureau and similar bodies, but I am seeking an extension of this work, with people staffed by the public offices in the town hall in cases where there is a major scheme, such as; there is in Bournemouth, and where there is a situation of special need. Since the council is promoting the development, on behalf of the community, it has an obligation to give all possible help to individuals whose interests are affected.
There may be all kinds of difficulties in my suggestions, but we have to try to find still better ways of improving the services that we give to people where community interests affect their personal positions and property. Certainly in a situation such as now exists in Bournemouth, much personal worry and suffering would be avoided if effective, patient and sympathetic advice was on hand. I do not know whether the Joint Parliamentary Secretary will feel able to comment in detail on the points that I have put forward, but I hope that as a result of this short debate he will give careful thought to further ways of helping these citizens when they justly call for it.
3.43 p.m.
The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Arthur Skeffington): May I first of all express my appreciation to the hon. Member for Bournemouth, West (Sir J. Eden), not only for the way in which he has moved this Motion, but for the Motion itself. He has brought quite clearly before the House, Ministers and planners, the fact that one of the consequences of planning, which we must never forget, is the human effects flowing from it, particularly when we deal with the sort of changes that he has indicated are taking place in Bournemouth.
It is sometimes put forward as a criticism of planners that they look ahead to marvellous schemes, on paper, but sometimes forget that the whole purpose of planning is about people. My right hon. Friend, in introducing the Town and Country Planning Bill, which will make a number of significant changes in this respect, said "Planning is about people." We must make sure that plans are not likely to be wrong and to cause a great
1258
deal of unnecessary hardship. The hon. Gentleman has performed a great service in raising this matter.
I have a personal interest, and additional pleasure in replying in that in my very early days I lived in Christ-church. Some of the happiest days of my life were spent there, so I know something about this area and surrounding districts, and can appreciate the problems that the hon. Member has mentioned. When I was last in that part of Hampshire—I try to go there whenever I can —I was astonished at the change which had taken place even in the two years since I last went. We are up against profound changes, and the hon. Gentleman's constituency and a number of other constituencies will have suffered uncertainty and anxiety which I hope this debate will allay to some extent.
We are in a period of rapid transition. The hon. Gentleman referred to the number of motor cars. I said the other day that the number is almost frightening. It does not do any good to be frightened about it, but the thought of 20 million motor cars being on the road by 1980 is not one which I exactly welcome. Unless we are very careful in our forward planning, we shall do untold harm not only to the hearts of our cities and countryside, as I said in the speech which has been quoted, but to the lives of people in other communities. Every time we create a one-way street we may bring traffic into quiet side streets which previously were peaceful. We must do this only if we are absolutely sure that it is essential.
I mention those preliminary points because they are very much in our minds. As I am sure the hon. Gentleman realises, we are in constant consultation with the Ministry of Transport on these points and both Departments bear them in mind. There is the utmost coordination. I am not sure whether in the early days the Departments should have got together more than they did. We must provide in the best way possible for technological changes, including changes in transport. It has been said by the British Road Federation—I do not know whether it is right—that there are about 55 cars per mile of road in this country. This poses enormous problems.
In general, there are three ways in which we can broadly attempt to minimise the damage which sometimes

1259
changes may bring to groups of people. There must be very long-term planning. There must be the greatest possible amount of information available about those plans so that those most affected know about them at a very early stage. I expect that the hon. Gentleman knows that at the moment I am chairing a committee which is giving particular attention to the problem not only of acquainting people with proposals but of asking them to take part in making plans. This is essential in the sort of technological democracy in which we live.
It is sometimes said that we spent 200 years or more in achieving representative government. What we must achieve now is the active participation of people. It is not good enough to leave it to the hon. Gentleman and myself. People must not only know about plans but take their share in them. That is our attitude. The hon. Gentleman will be aware that in the Planning Bill which is going through another place a number of steps are being taken whereby there will be early notification of plans and the opportunity for participation and by which new statutory obligations will be placed on local authorities. This is a course which I am sure the hon. Gentleman will appreciate and which will be supported by public opinion.
In addition, we have taken action to conserve those things which should be conserved almost at any price because they are part of our heritage—whether they are priceless, irreplaceable old buildings or the equally irreplaceable beauties of the countryside. If they have gone, they are gone for ever. Man cannot live by the motor car or bricks alone. He needs his valuable heritage and environment.
I know that the hon. Gentleman was not making a case against road developments. He referred to anxieties which have worried a number of his constituents. He first raised the general question of compensation. He will know that on 23rd July my right hon. Friend said that there is to be a change in the compensation payable to owner-occupiers whose houses are demolished under a clearance scheme. They will be entitled in future to supplementary payments over and above the site value which hitherto
1260
has been regarded as the normal basis of compensation. I mention that as an example of our earnest intention that this matter is being seriously considered.
What we have been able to announce indicates the sort of study which we have been making. We are considering also other proposals. It would be quite unwise for me to go further than this, because we do not want to raise false hopes. It is a matter which we are considering seriously. I am glad that the hon. Baronet has raised it and we will see that the specific points which he has made will go before those in the Ministry who are studying these problems.
The hon. Member made some other interesting suggestions on which I should like to comment. The first is the question of a central place where people can go to get information, and this is right. The hon. Member paid tribute to the Citizens' Advice Bureau, which does a magnificent job. In changes of this scale with which we have been confronted, the voluntary bodies must very often be supported by central action by the community.
The town hall is often in a position to have information, and to have it quickly, which the voluntary body cannot know. The town hall is a place where many of the problems can be dealt with simultaneously, whereas only one or two can be dealt with by the Citizens' Advice Bureau. Some authorities are already active in this direction in the provision of information, not only about schemes, but concerning places where other details can be obtained—lists, for example, of other agencies which may be able to help or of experts of one kind or another— and can often at the one interview give the citizen who is worried, whatever pieces of information are needed, thus helping him to make up his mind. By doing everything that we can in the Ministry, we greatly encourage this. I am sure that this is right.
I hope that when my Committee's recommendations come forward, although they will deal only with the planning side, we shall be able to reinforce some of the suggestions which have been made, and not only include them in our recommendations, but also, possibly, give them some kind of statutory provision under orders which we may be able to issue under the planning legislation.

1261
The hon. Baronet made a number of other points. There is the question of the local authority acquiring property in advance of schemes so that those who are displaced, particularly the elderly, may be able to be accommodated within the area. I know that the hon. Member has raised with the Department the case of a lady—to save embarrassment, I shall not mention her name—who is rather elderly and wants to remain near the church with which she has been associated for a good many years and near her neighbours. If we fail to recognise that sort of human problem, even though we may not always be able to solve it, we shall be failing in our responsibilities.
It is a very good thing if the local authority can, in advance, acquire property which is available in the locality. This depends, of course, upon the circumstances. Sometimes there is no alternative property. Sometimes it is necessary to have an alternative scheme before it is possible to rebuild, or people may have to be removed from the area, which can be distressing.
Local authorities have power to acquire property which is available in order to do this. The way in which they do it is a matter for them. I am, however, glad that the hon. Baronet has put it on record, because that is what we encourage local authorities to do. We are always studying whether we can make specific suggestions to local authorities about this in a way which may be helpful to them in getting advice, for example, from other authorities which have pioneered in this way.
I should like to consider all the remarks which the hon. Member has made. They seem to us to be helpful and constructive. If we can supplement what we have said, we will do so. I assure him that we are looking closely at the whole problem of compensation.

McKINLAY WILLIAMS ESTATE, BELVEDERE
3.54 p.m.
Mr. James Wellbeloved: I think it is appropriate that the last debate on the last day before the House goes into Recess for the summer should be the time when Parliament gives consideration to an urgent plea from a small group of private citizens in my constituency who have suffered an injustice.
I want to refer to a very small development which is taking place in a small, quiet close, called Gideon Close, at Belvedere. It is a quite little area where there are only 12 houses and 12 ordinary families involved. It lies at the foot of a steep embankment under an undulating plot at a higher level. It is that other plot of land which is now being developed by a builder, with between 50 and 60 further housing units.
It is because of the activities of that builder that I am raising this matter this evening, because there has been a complete disregard by the developer of the planning permission which was originally granted by Bexley Council, and it has resulted in the peace and the security of my constituents being shattered by the erection of a bleak, monstrous, concrete wall about 13 ft. in height which was erected 12 ft. out of the approved, planned position.
The facts are these. The site in question, called Regent Square, Belvedere, received planning permission in August, 1966 for development. Since then, there have been a number of further plans submitted by the developer which have caused certain modifications from that originally given planning approval. In January and May of 1967, and then again in November, 1967, further plans were submitted, and approved by the council. All these plans, the chopping and changing of the layout, were submitted by a firm called McKinlay Williams Estate, Limited, who are the builders doing this development and from these plans—there are five in total—two salient facts emerge.
The first is that all the plans submitted confirm this monstrous retaining wall as being 12 ft. back from the position it now occupies dominating this quiet close. The second fact which has emerged is

1263
that, again, all the plans submitted by McKinlay Williams Estate Limited, show the boundary of the Regent Square site and Gideon Close in the precise position my constituents claim, and this is now being disputed by McKinlay Williams Estate Limited.
Another important fact I would ask the Parliamentary Secretary to bear in mind, because this supports the claims of my constituents, is that drawings prepared by the borough engineer and surveyor under Section 40 of the Highways Act, 1959, confirm that this wall is 12 ft. out of position and also confirm, once again, the boundary of the Regent Square site.
So blatant has been McKinlay Williams Estate Limited's disregard for the approved position of this retaining wall that the Bexley Council, on 20th March of this year, served on the developer an enforcement order requiring that this wall should be removed. The developer, needless to say, appealed, and the Minister of Housing and Local Government appointed an inspector to hold a local public inquiry, and the date was fixed for the hearing, 16th July, 1968.
My constituents were told of their rights to be heard at the inquiry. The residents were delighted. Here, at long last, they thought, justice was at least within sight of being done; they would have an opportunity of presenting their case, presenting the facts to an inspector at a public inquiry, and all would be well.
The Bexley Borough Council, as the body responsible for the enforcement order, prepared the necessary documents to submit to my hon. Friend's inspector and displayed them at the local town hall.
It being Four o'clock, the Motion for the Adjournment of the House lapsed, without Question put.
Motion made, and Question proposed, That this House do now adjourn.— [Mr. McCann.]
Mr. Wellbeloved: I was about to quote from the council's document. Under the heading, "A case for a planning authority ", the paragraph reads:
"A retaining wall situate at the end of Gideon Close might cause some detriment to the visual amenity of the properties in Gideon Close, whatever the precise position
1264
of the wall. However the originaly approved position overcame the injury to amenity by providing that only 6 feet of the wall be exposed, and the remainder would be screened by replacement of the original earth bank which would be landscaped. As now erected the wall is quite unscreened, and presents a most unattractive blank face to Gideon Close. It is the Council's view that the most satisfactory solution is that the Minister should uphold the enforcement notice, so as to secure the removal of the wall from its present position. It is essential from an engineering point of view that there should be a wall, and if the appellant follows the approved plan, the detriment to amenity will be almost obliterated."
The Minister is, therefore, requested to uphold
"the enforcement order and to dismiss this appeal."
A strange thing then happened. The town planning committee met on 4th July of this year and completely changed the council's policy in respect to this site. It granted permission to the developer for the retaining wall and added a condition that there should be erected in front of that monstrous wall a small 5 ft. high screening wall which could be planted out behind to help hide this bleak concrete face. This permission was given only 12 days before the people in Gideon Close were to have the opportunity of having their case considered by an independent inspector appointed by the Minister of Housing and Local Government. The council's approval meant that the enforcement notice lapsed, and that my constituents were denied the opportunity of appealing for justice at a public inquiry.
That is bad enough, but it is not all. The town planning committee, setting itself up as judge and jury in the case, approved that 5 ft. screening wall on land that was owned by the occupants of Nos. 11 and 12 Gideon Close, despite the fact that those owners had written in December of last year, and again in June of this year, informing the council that the land was in their ownership, and despite the fact that the five plans already submitted to the council by McKinlay Williams Estate Limited had shown the land in question to be outside the boundary of the Regent Square site owned and being developed by that company.
Another significant factor emerges. The final plan that was approved on 4th July by Bexley Council was not submitted by McKinlay Williams Estate

1265
Limited. For the first time in all these planning submissions there came into the picture a company called Holmglen Investments Ltd., a small company with only £100 paid-up capital, owned by the same shareholders as McKinlay Williams Estate Limited, and with the same directors.
Bexley Council, in granting Holmglen Investments Ltd. approval for the screening wall on what they knew to be someone else's land, laid down a condition that the developer should be responsible for the maintenance of the wall for a period of five years. What is to happen after that five years? I should be asking this of Bexley Council. What is to happen even before that five years is up if Holmglen Investments Limited, as some fear it will, turns out to be nothing but a straw company and winds up its affairs? The unfortunate residents of Gideon Close will be left holding the baby. They will have to face the aftermath of the blatant disregard of planning approval and planning permission by McKinlay Williams Estate Ltd. and the aftermath of Bexley Council's dubious activities in this case.
Any subsequent legal action by the residents of Gideon Close could involve equally innocent people who might be unwise enough to purchase houses at Regent Square, Belvedere, from McKinlay Williams Estate Limited, Holmglen Investments Limited or another company formed by the same people, Danson Road Enterprises Limited. Anyone buying a house from those sources might find himself in dispute over the maintenance of this wretched wall. I am told that a block of dwellings is being erected by the developer immediately above Gideon Close on this site and several feet out of the approved position. It may be that because of the chopping and changing that have taken place other blocks of dwellings will be built. My constituents' land is being flooded by water coming down from the higher land because of inadequate drainage of the site.
This case calls for a thorough investigation. It is little wonder that the people of Bexley are beginning to mutter veiled remarks about the possibilities of unusual happenings in relation to this Regent Square development. I beg my hon. Friend to see that an inquiry under
1266
the powers given to his right hon. Friend is set up to ensure that there is a public hearing of this case. My constituents have suffered an injustice. They deserve to have a fair, independent hearing. The circumstances surrounding the whole issue are such that there is growing public disquiet in my constituency. Suspicion has been aroused in the minds of the people that all may not be well in regard to other aspects of the scheme. Only a public inquiry can restore public confidence. I ask that the Minister should step in and see that justice prevails.
4.8 p.m.
The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Arthur Skeffington): I congratulate my hon. Friend the Member for Erith and Crayford (Mr. Wellbeloved) on the very concise way in which he has summarised the rather complex history of this planning application and thereby saved my time in setting it out. I am most grateful to him.
I am sure the whole House admires, as I do, his persistence in this matter and his pressing on something which he believes causes great disadvantage to some of his constituents. Although there are not many, the families living in this close who bought houses there—no doubt on mortgage—want to protect the surroundings of those houses. They are entitled to "quiet enjoyment", which covers amenities. Although this matter does not affect many people, it gravely concerns the welfare of these families. If in any of these planning matters we overlook, neglect or do not pay sufficient attention to the human aspect the planning processes can justly be criticised.
The central issue here is that it is alleged that a substantial wall, 12 feet high, has been built in a way which is offensive to a number of people and is not in accordance with the original planning permissions given by Bexley Council. This was the subject of justified complaint. As my hon. Friend said, the council at one stage took such a serious view of this transgression that it issued an enforcement notice which would have required the developers to have pulled the wall down.
Under the planning law, there are two ways of dealing with such a situation.

1267
Sometimes it is suggested to a developer or builder who has gone wrong that the common-sense solution would be for him to put in another application, which could be properly considered by the council; objections could be made, but if on the whole the matter went through these processes to the stage where the council felt able to give permission the fault is put right and everything is above board.
This course has the merit of commonsense in many cases, because on the whole public opinion does not support either the planning authority or the Government if when something has been erected the developer or builder is told to take it down. It seems rather absurd sometimes that when this has occurred all the work has to be done again, with the consequent waste of time and money. Where sometimes a council has felt that it must insist on this, and where the council's attitude hes been supported by the Minister, we have often got a hostile Press, because often the Press does not understand what the basic facts are and represent the matter as some rather frivolous piece of bureaucracy, whereas in point of fact it may be a serious infringement which will affect the convenience or welfare of a considerable number of people.
Sometimes that course can be adopted. In this case, the Bexley Council finally, instead of proceeding with its enforcement notice, upon the receipt of another application gave permission for the retention of the wall where it was, although it is clear that it has not been built where permission was originally given for it to be.
I think that my hon. Friend realises that when that happens there is no procedure for an inquiry, because there is no enforcement notice before the Minister. The case must then be dealt with on its merits. The case has gone through the necessary stages and planning permission has been granted. The procedure with the local authority is exhausted.
It is possible in certain circumstances for the Minister, even at this stage, to intervene under Section 207 of the Town and Country Planning Act, 1962, and to withdraw the planning permission. This leads to an inquiry, on the report arising from which the Minister decides whether
1268
he should go to the full length of the powers he has under this Section. This is a very important constitutional point: the powers under Section 207 have been very rarely used since 1947. The Minister has initiated proceedings under Section 207 in 11 cases connected with mineral workings, which have all kinds of different connotations, largely connected with compensation.
In only about 16 cases of normal development since 1947 has the Minister intervened. Sometimes these have been over very large areas of the country and the Minister has intervened perhaps to prevent a development from even starting. On the whole, this has been justified, but it is a rare power.
I must put it on record that for the Minister, at this stage in any planning permission, to use his powers under Section 207 he must be absolutely assured that it is justified in the public interest, although the public interest can be 12 families, as here, and not 200,000 people. The whole tendency in our belief in representative Government and in local democracy is that Whitehall should not interfere with the local authority unless this kind of consideration arises. I am sure that, when my hon. Friend was leader of the Erith Council, he would have been the first person to lead deputations here and to have some sort of Motion moved in the reverse sense to his present one were the Minister to interfere too often.
I must make clear, therefore, that it is only in the most exceptional cases—I am sure that we are supported here by public opinion and the whole House— that the Minister will intervene in this sort of case, Parliament having clearly given to the local authorities power to decide day-to-day applications. Anything I say further must not detract from this general position which the Minister has taken up and the general constitutional position which, I think, is accepted by everyone.
However, what my hon. Friend has told me today leads me to believe that, without going so far as to say that the Minister should proceed under Section 207, there are certain factors which suggest that at least we should have further consultations with the local planning authority. I think that that will be the proper and fair way to proceed. For example, my hon. Friend raised the

1269
question what is to happen at the end of five years if the new retaining wall is built in front of the other retaining wall and the space is filled up with trees and shrubs. Is the maintenance cost to fall upon the, residents? They have not been responsible for creating the problem or obstacle.
Mr. Speaker: Order. It helps the proceedings and assists the reporters if the hon. Gentleman addresses the Chair.
Mr. Skeffington: The maintenance of the wall by the builders was under the condition to be for only five years, and I do not quite know why that five-year period was put in.
Second, as I understand it, there is considerable argument about whether the amelioration proposed can be carried out because the new suggested wall may not be built as it would have to be built on the property of those who are complaining. When the local planning authority granted permission for the new proposal, with the slight amelioration of the wall in front and the landscaping, I do not know whether it realised that the ground upon which it was to be built may be in dispute. If there is any doubt about whether this second wall can be built, it seems to me that there may be doubt as to whether the first proposal ought to have been allowed, and whether
1270
the existing wall should be permitted to stay.
In view of these new factors—new factors as far as I am concerned—I think that the proper course will be for the Ministry to have further consultations with the borough council. I shall be in touch with my hon. Friend after that to see whether any further steps should be taken.
I appreciate the point which my hon. Friend has raised, so much so that, although I cannot do this in connection with all the appeals coming to the Ministry in one way or another, I should like to visit this site. I do make visits from time to time. Within the next month or so, I shall hope to visit the site myself. In the meantime, I shall see that my officers get in touch with the borough council. As I say, we appreciate the point, and it is the desire of all of us, including the borough council, I am sure—I want to be quite fair to the council—that justice must be seen to be done in these matters which affect the family life and convenience of my hon. Friend's constituents. I propose, therefore, to proceed in that way.
Question put and agreed to.
Adjourned accordingly at nineteen minutes past Four o'clock, till Monday, 14th October, pursuant to the Resolution of the House of 24th July.

  OFFICIAL INFORMATION (DISCLOSURE TO THE PRESS)
  OFFICIAL INFORMATION (DISCLOSURE TO THE PRESS)
  OVERSEAS CIVIL SERVANTS (PENSIONS)
  OVERSEAS CIVIL SERVANTS (PENSIONS)
  PRIME MINISTER'S OFFICE (STAFF AND SALARIES)
  PRIME MINISTER'S OFFICE (STAFF AND SALARIES)
  NUCLEAR WEAPONS (NON-PROLIFERATION TREATY)
  NUCLEAR WEAPONS (NON-PROLIFERATION TREATY)
  COUNCIL OF EUROPE (UNITED KINGDOM DELEGATION)
  COUNCIL OF EUROPE (UNITED KINGDOM DELEGATION)
  FOREIGN AND COMMONWEALTH OFFICES (MERGING)
  FOREIGN AND COMMONWEALTH OFFICES (MERGING)
AGRICULTURE, FISHERIES AND FOOD
  Horticulture (Examination)
  Horticulture (Examination)
  Confectionery (Prices)
  Confectionery (Prices)
  HOUSE OF LORDS AND PRIVY COUNCIL (JUDICIAL SITTINGS)
  HOUSE OF LORDS AND PRIVY COUNCIL (JUDICIAL SITTINGS)
  LORDS OF APPEAL IN ORDINARY
  LORDS OF APPEAL IN ORDINARY
COMMONWEALTH AFFAIRS
  Gibraltar (Order in Council)
  Gibraltar (Order in Council)
  British Honduras Legislature (Verbatim Report)
  British Honduras Legislature (Verbatim Report)
  Rhodesia
  Rhodesia
  Nigeria
  Nigeria
  Personal Case
  Personal Case
  Prime Minister of Swaziland (Discussions)
  Prime Minister of Swaziland (Discussions)
MINISTRY OF DEFENCE
  Research Scientists and Engineers
  Research Scientists and Engineers
  Medical and Dental Staff, Malta
  Medical and Dental Staff, Malta
  Service Medical Officers (Civilian Patients)
  Service Medical Officers (Civilian Patients)
  H.M.S. "Condor", Arbroath (Training Facilities)
  H.M.S. "Condor", Arbroath (Training Facilities)
  Gruinard Island (Contamination)
  Gruinard Island (Contamination)
  Departmental Office (South Wales)
  Departmental Office (South Wales)
  Non-Commissioned Ranks (Commutation of Pensions)
  Non-Commissioned Ranks (Commutation of Pensions)
ECONOMIC AFFAIRS
  National Economic Development Office (Expenditure)
  National Economic Development Office (Expenditure)
EDUCATION AND SCIENCE
  Royal School for the Blind, Bristol (Closure)
  Royal School for the Blind, Bristol (Closure)
  University Entrants
  University Entrants
  School Projects, Hampshire
  School Projects, Hampshire
  Premature Baldness
  Premature Baldness
  Education Expenditure (Wales)
  Education Expenditure (Wales)
  Racial Issues (Education)
  Racial Issues (Education)
EMPLOYMENT AND PRODUCTIVITY
  Industrial Disputes
  Industrial Disputes
  Production Industries (Employment)
  Production Industries (Employment)
  Goods and Services (Proposed Price Increases)
  Goods and Services (Proposed Price Increases)
  Philips Brown Inquiry (Report)
  Philips Brown Inquiry (Report)
  Miners and Mining Apprentices, Lanarkshire
  Miners and Mining Apprentices, Lanarkshire
  Regional Prices Boards
  Regional Prices Boards
  Older Workers
  Older Workers
  Distributive Trade (Industrial Training Board)
  Distributive Trade (Industrial Training Board)
  Irish Soldiers' and Sailors' Land Trust (Sale of Houses)
  Irish Soldiers' and Sailors' Land Trust (Sale of Houses)
  Tailors and Garment Workers (Pay Settlements)
  Tailors and Garment Workers (Pay Settlements)
  Redundant Workers, Caerphilly (Retraining)
  Redundant Workers, Caerphilly (Retraining)
  Municipal Busmen's Pay (Standstill Order)
  Municipal Busmen's Pay (Standstill Order)
  EMBASSY CHURCHES
  EMBASSY CHURCHES
  CZECHOSLOVAKIA
  CZECHOSLOVAKIA
  BRITISH SUBJECTS, CHINA (DETENTION)
  BRITISH SUBJECTS, CHINA (DETENTION)
  VISA-FREE ENTRY (DISCUSSIONS)
  VISA-FREE ENTRY (DISCUSSIONS)
  PASSPORT-OFFICE (REVIEW OF PROCEDURE)
  PASSPORT-OFFICE (REVIEW OF PROCEDURE)
  BRITISH BROADCASTING CORPORATION (HEBREW SERVICE)
  BRITISH BROADCASTING CORPORATION (HEBREW SERVICE)
MINISTRY OF HEALTH
  Illegitimate Births
  Illegitimate Births
  Prescription Charges
  Prescription Charges
  Dentists, Andover
  Dentists, Andover
  Disabled Persons (Motor Vehicles)
  Disabled Persons (Motor Vehicles)
  Haemophiliacs (Motor Vehicles)
  Haemophiliacs (Motor Vehicles)
  Social Services, Cumberland (Grants)
  Social Services, Cumberland (Grants)
HOME DEPARTMENT
  Drugs (Thefts)
  Drugs (Thefts)
  Fraud Charges (Legal Aid)
  Fraud Charges (Legal Aid)
  Unlicensed Vehicles
  Unlicensed Vehicles
  Drug Addiction (Statistics)
  Drug Addiction (Statistics)
  Crime Rate (Statistics)
  Crime Rate (Statistics)
  Children in Care
  Children in Care
  Prisons (Working Parties)
  Prisons (Working Parties)
  Risley Remand Centre (Suicides)
  Risley Remand Centre (Suicides)
  Meeting and March, West End (Police Costs)
  Meeting and March, West End (Police Costs)
  Littlewood Report (Implementation)
  Littlewood Report (Implementation)
  Civil Defence Staff (Redundancy Payments)
  Civil Defence Staff (Redundancy Payments)
HOUSING
  Greater London Council (Rent Increases)
  Greater London Council (Rent Increases)
  Waiting Lists, Greater London Area
  Waiting Lists, Greater London Area
  Housing Subsidies, Greater London Council (Exchequer Grants)
  Housing Subsidies, Greater London Council (Exchequer Grants)
  Houses and Flats (Housing Society Schemes)
  Houses and Flats (Housing Society Schemes)
LOCAL GOVERNMENT
  Derelict Land (Acquisition and Reclamation)
  Derelict Land (Acquisition and Reclamation)
  Historic Buildings
  Historic Buildings
  River Culin, Uffculme (Footbridge)
  River Culin, Uffculme (Footbridge)
  Section 9, Leasehold Reform Act
  Section 9, Leasehold Reform Act
  New Offices, Greater London
  New Offices, Greater London
  TELEVISION SETS (MINISTERS' ROOMS)
  TELEVISION SETS (MINISTERS' ROOMS)
  THAMES PAGEANT (VIEWING ARRANGEMENTS)
  THAMES PAGEANT (VIEWING ARRANGEMENTS)
OVERSEAS DEVELOPMENT
  Aid Programme
  Aid Programme
  Singapore Base (Withdrawal)
  Singapore Base (Withdrawal)
POST OFFICE
  Special Stamps
  Special Stamps
  Two-Tier Delivery Service
  Two-Tier Delivery Service
  Departmental Research (Private Industry)
  Departmental Research (Private Industry)
  Rowner, Gosport (Post Offices)
  Rowner, Gosport (Post Offices)
  Telecommunications Industry (Industrial Reorganisation Corporation Report)
  Telecommunications Industry (Industrial Reorganisation Corporation Report)
  Post Office Corporation
  Post Office Corporation
  Advertising
  Advertising
WIRELESS AND TELEVISION
  B.B.C. Publications
  B.B.C. Publications
  B.B.C. Television Reception, East Kent
  B.B.C. Television Reception, East Kent
GAS
  North Sea Gas (Contract Price)
  North Sea Gas (Contract Price)
MINISTRY OF POWER
  British Steel Corporation (Holdings)
  British Steel Corporation (Holdings)
COAL
  Production (Long-Term Marginal Cost)
  Production (Long-Term Marginal Cost)
  Mines and Collieries, Scotland
  Mines and Collieries, Scotland
SCOTLAND
  Windblow Areas (Clearance)
  Windblow Areas (Clearance)
  Legal Aid
  Legal Aid
  Police Crime Squads (Helicopter Support)
  Police Crime Squads (Helicopter Support)
  Schools (Scotland) Code
  Schools (Scotland) Code
  Offensive Weapons (Amnesty)
  Offensive Weapons (Amnesty)
  Land Commission (Staff)
  Land Commission (Staff)
  Selective Employment Tax (Repayment to Farmers)
  Selective Employment Tax (Repayment to Farmers)
  Scottish Office (Staff)
  Scottish Office (Staff)
  Horticulture Improvement Scheme
  Horticulture Improvement Scheme
  Highland Natural Resources
  Highland Natural Resources
  Housing (Improvement Grants)
  Housing (Improvement Grants)
  Ophthalmic Services
  Ophthalmic Services
  Scottish Grand Committee
  Scottish Grand Committee
  Fruit (Carriage Charges)
  Fruit (Carriage Charges)
  European Free Trade Association (Scottish Interests)
  European Free Trade Association (Scottish Interests)
  Rate Burden (Lanarkshire)
  Rate Burden (Lanarkshire)
  Forestry Commission (Hiring Scheme)
  Forestry Commission (Hiring Scheme)
  Marine Research
  Marine Research
  University Entrants
  University Entrants
  Spina Bifida
  Spina Bifida
  Roads (Expenditure)
  Roads (Expenditure)
  Perth Prison (Incident)
  Perth Prison (Incident)
  Police Forces (Manpower)
  Police Forces (Manpower)
  School Building (Hamilton)
  School Building (Hamilton)
  Educational Reorganisation
  Educational Reorganisation
  Physiotherapists (Special Allowances)
  Physiotherapists (Special Allowances)
  Regional Hospital Boards (Membership)
  Regional Hospital Boards (Membership)
  Trondra-Burra Isle Scheme
  Trondra-Burra Isle Scheme
  Technical Teachers (Recruitment and Training)
  Technical Teachers (Recruitment and Training)
  Aluminium Smelter, Invergordon (Electricity Supply)
  Aluminium Smelter, Invergordon (Electricity Supply)
SOCIAL SECURITY
  Supplementary Benefit, Lanarkshire
  Supplementary Benefit, Lanarkshire
  Pension Rates (Scottish Old-Age Pensioners Association Conference)
  Pension Rates (Scottish Old-Age Pensioners Association Conference)
  Old People (Special Needs)
  Old People (Special Needs)
  Retirement Pensioners (Tobacco)
  Retirement Pensioners (Tobacco)
TECHNOLOGY
  European Airbus
  European Airbus
  British Airliner Project
  British Airliner Project
  Short Brothers and Harland Limited (Interim Finance)
  Short Brothers and Harland Limited (Interim Finance)
BOARD OF TRADE
  Rolls-Royce Limited (Industrial Development Certificate)
  Rolls-Royce Limited (Industrial Development Certificate)
  Employment Incentives (Caerphilly)
  Employment Incentives (Caerphilly)
  Loss of "Titanic" (Petition)
  Loss of "Titanic" (Petition)
  Turnhouse Airport, Edinburgh
  Turnhouse Airport, Edinburgh
  Raspberry Pulp (Yugoslav Imports)
  Raspberry Pulp (Yugoslav Imports)
ROADS
  Scotland (Mileages)
  Scotland (Mileages)
  Wool Road, Saddleworth (Improvement Scheme)
  Wool Road, Saddleworth (Improvement Scheme)
  South Coast Trunk Rood Burridge
  South Coast Trunk Rood Burridge
  Dereham—Wymondham Road
  Dereham—Wymondham Road
PORTS
  Deep-Water Ports
  Deep-Water Ports
RAILWAYS
  Richmond-Darlington Line
  Richmond-Darlington Line
  Railway Stations (Amenities)
  Railway Stations (Amenities)
  Passenger Trains (Non-Smoking Compartments)
  Passenger Trains (Non-Smoking Compartments)
  Locomotive Failures
  Locomotive Failures
TRANSPORT
  Epileptics (Driving Licences)
  Epileptics (Driving Licences)
  Motor Vehicle Test Certificates (Mileage Record)
  Motor Vehicle Test Certificates (Mileage Record)
  Research (Advisory Body)
  Research (Advisory Body)
NATIONAL FINANCE
  Gallaher Limited
  Gallaher Limited
  Tax Allowances
  Tax Allowances
  Sterling Balances (Interest Payments)
  Sterling Balances (Interest Payments)
  National Debt (Servicing Cost)
  National Debt (Servicing Cost)
  Equity Capital (Government Investment)
  Equity Capital (Government Investment)
  Hansard (Postal Delivery)
  Hansard (Postal Delivery)
  Personal Allowances
  Personal Allowances
WALES
  Land Commission
  Land Commission

Preamble
The House met at eleven of the clock: The EARL OF LISTOWEL on the Woolsack.
Prayers—Read by the Lord Bishop of Chester.

PUBLIC BILLS AND PARLIAMENTARY SESSIONS
LORD MERTHYR: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will make arrangements to enable Public Bills to be carried over from Session to Session in the same way as Private Bills may be carried over; and if not, why not.]
THE PAYMASTER GENERAL (LORD SHACKLE TON): My Lords, any decision to enable Public to be carried over from Session to Session would involve a decision by both Houses of Parliament. I should point out that Private Bills are not analogous to Public Bills in a number of respects. The noble Lord knows this as well as anyone. In particular the procedure involved in the promotion of a Private Bill requires the payment of fees and other expenditure which may be very heavy, both for the Promoters and for any Petitioners. I would remind the noble Lord, that the whole question of carrying over Bills from Session to Session was considered by a Joint Committee of both Houses in 1929 when no unanimity of opinion emerged and no action was taken on the Committee's Report.
LORD MERTHYR: My Lords, in thanking the noble Lord for that Answer may I ask him one supplementary question? I hope no more than one. Would he not agree that it would be better, if Her Majesty's Government, or the noble Lord himself, wished to "kill" a Bill of any kind that they should vote against it rather than snuff it out by the effluxion of time, a process which most people now consider to be highly unsatisfactory?
SEVERAL NOBLE LORDS: Hear, Hear!
LORD SHACKLETON: My Lards, I do not know that the Government ever seek in this House to "kill" a Bill; I do not think I can comment on the tactics employed by any Government in another place.

ABERFAN PIT HEAPS
LORD SILKIN: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they plan for an early and complete removal of the pit heaps at Aberfan.]
BARONESS PHILLIPS: My Lords, as my right honourable friend the Prime Minister stated in another place on July 25, this matter is under active consideration, and it is hoped that a statement can be made soon.
LORD SILKIN: My Lords, may I ask whether the Government will regard this matter not purely from the point of view of how much it would cost but as an act of mercy to the people who are forced to live in Aberfan and see these pit heaps every day and every night of their lives? They are constantly reminded of the loss of their 116 children. I would beg my noble friend to put this strongly to the Prime Minister. It is not a matter of money. This site could be used for open spaces or for some public building for the benefit of the children.
BARONESS PHILLIPS: My Lords, I was in Wales last week and I can assure my noble friend that I am at one with him in knowing the feeling of the people in this connection. I will certainly do all I can to represent those views in addition to those already put forward.
LORD OGMORE: My Lords, like the noble Baroness I know this area and I am acquainted with the situation. If, in spite of the plea of the noble Lord, Lord Silkin, which I support, the Government find themselves unable to meet the vast expense of clearing these heaps, may I ask whether they will consider clearing away the existing houses, rehousing the people and compensating the owners of those houses which will be lost? Is it

1391
not a fact that there was one street of houses which was badly affected? If this were done it would at least enable people to sleep comfortably and not to have the fear of the tip coming down on top of them again.
BARONESS PHILLIPS: My Lords, I should like to thank the noble Lord, Lord Ogmore, who I know is, as I am, very concerned about the situation. I will certainly convey that admirable suggestion to my right honourable friend the Prime Minister.
BARONESS BURTON OF COVENTRY: My Lords, as a non-Welshwoman who has worked in the Welsh Valley, may I support strongly what my noble friend Lord Silkin has said; and would my noble friend Lady Phillips suggest to the Prime Minister that this is an occasion which neither logic nor reason can assuage, and will she see what can be done?
LORD OGMORE: My Lords, I should like also to ask whether the Government will look into the wider question of the utilisation of tips. There is a plan in existence, of which I could give full details, for making these tips into market gardens. It may sound absurd, but there is in fact a plan to utilise the tips by terracing.
BARONESS PHILLIPS: My Lords, I should like to thank the noble Lord, Lord Ogmore, for that suggestion. I am speaking without complete knowledge, and it may be that some of the suggestions are already under consideration, but I will certainly see that anything which has been said this morning is taken further.

AID TO ZAMBIA
11.12 a.m.
LORD BARNBY: 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 is the total aid of all kinds made to Zambia over the past four years; on what grounds further assistance, if any, is now proposed; and what is the amount of such further assistance.]
THE MINISTER OF STATE FOR COMMONWEALTH AFFAIRS (LORD SHEPHERD): My Lords, nearly £51 million; of which £8 million for development and £1.2 million for defence equipment promised in 1965 has not yet been disbursed. No further capital assistance has been committed, but technical assistance, mainly to pay for the cost of expatriate staff, is currently running at something over £3 million per annum. On the question of further contingency support I would refer the noble Lord to the written reply given by my right honourable friend the Prime Minister on July 23.
LORD BARNBY: My Lords, may I ask the noble Lord whether he recalls that there was reported to this House recently advances of up to £24 million to Tanzania? Those, together with the figures he has just quoted, are massive contributions by the United Kingdom taxpayer. Does he not think that there is imprudence in giving such large amounts to two countries which are aggressively projecting into the territories of their neighbours, Mozambique and Rhodesia, the Communist trained so-called "freedom fighters", alias terrorists; and does he not think that this could be a greater threat to the peace of Central Africa than the significant law and order maintained in Rhodesia by the de facto Government?
LORD SHEPHERD: My Lords, the noble Lord has his own views. They are without substance, and I do not believe his views are shared by his noble friends on the other side of the House.
LORD FRASER OF LONSDALE: My Lords, while the noble Lord may feel that there is a moral aspect involved in this and therefore the question of cost must be secondary, will he and the Government bear in mind that if we in the United Kingdom dribble away and expend our resources all over the world we shall ourselves be too weak to exercise any moral influence anywhere?
LORD SHEPHERD: My Lords, I do not accept that. It may be that we have our own economic difficulties, some of which may have been made by ourselves over past years, but these territories are territories in urgent need of help and if we can develop their economies in the end world trade itself must expand.
LORD BROCKWAY: My Lords, is it not a fact that Zambia has probably had to bear a larger burden, perhaps the largest, of the sanctions policy against Rhodesia, and in view of Zambia's loyalty to our Government in seeking to overthrow the illegal regime is my noble friend aware that many of us highly appreciate the agreement which has been reached between President Kaunda and our Government during his recent visit?
LORD SHEPHERD: My Lords, I feel more attuned to what the noble Lord has said than some of the views I have heard expressed on other occasions.
BARONESS GAITSKELL: My Lords, would not the Minister agree that the sentiments expressed by the two noble Lords opposite just now are not only unimaginative but simply ludicrous when we compare the situation in countries like Zambia and countries like ours.
LORD GRIMSTON OF WESTBURY: My Lords, could the noble Lord give any breakdown of the original figure to indicate how much of the money advanced to Zambia has arisen directly as a result of the sanctions policy?
LORD SHEPHERD: My Lords, I should be most happy to give that information. Of the £51 million, some £24 million was for contingency support arising directly from sanctions; £14·75 million for capital development; some £8 million for technical assistance to provide topping-up for the expatriates, some 3,000 expatriate British civil servants who now work in Zambia; £2 million for defence aid, and a further £2 million for special financial aid compensation to the British South Africa Company.
LORD FRASER OF LONSDALE: My Lords, does the noble Lord on the Front Bench agree with the noble Baroness behind him that it is unimaginative to stand up for a moral matter if you are not strong enough to stand up at all?
LORD SHEPHERD: My Lords, I would not accept that we are not strong enough to stand up; we clearly are. I did not reply to my noble friend because I thought the point she had made was far better left unanswered.

MILITARY EXERCISES IN WEST GERMANY
11.17 a.m.
LORD BROCKWAY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will use their influence to cancel the NATO manœuvres due to be held near the Czechoslovak frontiers, in view of the critical issue of democratic liberty in that territory.]
THE PARLIAMENTARY SECRETARY, MINISTRY OF PIJBLIC BUILDING AND WORKS (LORD WINTERBOTTOM): My Lords, I presume that the noble Lord is referring to the exercise known as "Black Lion", which was originally planned to be held in Bavaria. This is not a NATO exercise but an exercise by the Federal German armed forces, with the participation of some small French and American units. As the noble Lord will no doubt have seen, the Federal German Government have now decided to transfer the exercise from Bavaria to Baden-Württemberg. It can thus no longer be described as being near the Czech border.
LORD BROCKWAY: My Lords, I thank my noble friend for that reply. Is it not very desirable in these circumstances that we should not appear to be engaged in any provocative action? While we welcome the decision of the West German Government to transfer its manœuvres, is it not the case, as indicated in the Question, that NATO manœuvres are also under consideration, and if so would it not be desirable to accept the example of the Federal Government?
LORD WINTERBOTTOM: My Lords, that is another question.
LORD LEATHERLAND: My Lords, does my noble friend feel that what is sauce for the goose should be sauce for the gander, and that there is no more iniquity in having Western exercises near Czechoslovakia than in having Russian exercises there?
LORD OGMORE: My Lords, in view of that last question, may I ask the

1395
noble Lord whether he has read the very wise article of the noble Earl, Lord Avon, in the Daily Express this morning, in which he urges the NATO forces not to take provocative action anywhere near the Czech frontier at this very delicate time, and expresses the fears of Russia in view of the terrible depredations they had from Germany in the last war? Perhaps he would look at that article, because I think it gives very good advice to the Government.
LORD WINTERBOTTOM: My Lords, Her Majesty's Government are well aware of the feelings of concern in all the parties concerned with this delicate situation.

ADOPTION BILL CARAVAN SITES BILL FRIENDLY AND INDUSTRIAL AND PROVIDENT SOCIETIES BILL HEARING AID COUNCIL BILL HIGHLANDS AND ISLANDS (DEVELOPMENT) (SCOTLAND) BILL THEATRES BILL
Returned from the Commons, with the Amendments agreed to.

CONSOLIDATED FUND (APPROPRIATION) BILL
Brought from the Commons, endorsed with the Certificate from the Speaker that the Bill is a Money Bill within the meaning of the Parliament Act 1911, and read a.
Then, Standing Order No. 41 having been suspended (pursuant to the Resolution of July 15), Bill read 2a: Committee negatived; Bill read 3a, and passed.

DESIGN COPYRIGHT BILL
Brought from the Commons; read a, and to be printed.

PRAYER BOOK (FURTHER PROVISIONS) MEASURE
11.20 a.m.
THE LORD BISHOP OF CHESTERhad given Notice of his intention to move, That this House do direct that, in accordance with the Church of England Assembly (Powers) Act 1919, the Prayer Book (Further Provisions) Measure be presented to Her Majesty for the Royal Assent. The right reverend Prelate said: My Lords, I do not intend to move today the Motion standing in my name on the Order Paper. But since it has been on the Order Paper for some days, I think the House is entitled to an explanation of my action, and I beg leave of your Lordships briefly to explain my reasons.
It was hoped that the Prayer Book (Further Provisions) Measure would be presented in another place yesterday and would receive an Affirmative Resolution; and it was my intention to move a similar Resolution in your Lordships' House at this time, in the expectation that the Measure could be presented later to-day for the Royal Assent. Yesterday, however, in another place the Speaker was asked to give his ruling on a submission that a stage in the procedure for Measures laid down in the enabling Act had not been complied with and that the Measure could not yet be submitted for an Affirmative Resolution. The Speaker ruled that this was so, and in consequence did not put the Resolution to the House.
This ruling will cause surprise and concern to those responsible for ecclesiastical legislation, since the procedure to which this Measure has been subjected is no different from that which has been applied to Measures in the past. To my certain knowledge, all Measures in the last 30 years have been dealt with in precisely the same way as this Measure, and my expectation is that all Measures presented since the enabling Act of 1919 have gone through the same procedure. However, since the advantages to be gained from obtaining the Royal Assent to-day are no longer available, I think it necessary not to move the Resolution to-day, but to do so at a later date.
LORD SANDFORD: My Lords, I am sure we are grateful to the right reverend Prelate for the explanation of why he is

1397
not in a position to move his Motion to-day. I think it is another instance of the fact that if occasionally there are delays and inconsistencies in the dispatch of business through Parliament it is seldom this House that causes them.
LORD SHACKLETON: My Lords, I hope that the noble Lord, and indeed the right reverend Prelate, are not questioning the propriety of the decision taken in another place. There is a slight implication.
THE LORD BISHOP OF CHESTER: My Lords, no; in no circumstances.

THEFT BILL [H.L.]
11.24 a.m.
THE MINISTER OF STATE, HOME OFFICE (LORD STONHAM): My Lords, I beg to move that the Commons Amendments to the Theft Bill be now considered. I would mention that as we come to the Amendments I shall ask leave to take certain Amendments in groups.
Moved, That the Commons Amendments be now considered.—(Lord Stonham.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[References are to Bill [132] as first printed for the Commons]
No.1.]
Clause 1, page 1, line 12, leave out "four" and insert "five".
[No. 3.]
After Clause 5, insert the following new clause—
With the intention of permanently depriving the other of it
".—(1) A person appropriating property belonging to another without meaning the other permanently to lose the thing itself is nevertheless to be regarded as having the intention of permanently depriving the other of it if his intention is to treat the thing as his own to dispose of regardless of the other's rights, and a borrowing or lending of it may amount to so treating it if, but only if, the borrowing or lending is for a period and in circumstances making it equivalent to an outright taking or disposal.
(2) Without prejudice to the generality of subsection (1) above, where a person, having possession or control (lawfully or not) of property belonging to another, parts with the property under a condition as to its return which he may not be able to perform, this (if done for purposes of his own and
1398
without the other's authority) amounts to treating the property as his own to dispose of regardless of the other's rights."
[No. 6.]
Clause 14, page 7, line 32, at end insert—
"(3) Section ("With the intention of permanently depriving the other of it") shall apply for purposes of this section, with the necessary adaptation of the reference to appropriating, as it applies for purposes of section 1."
LORD STONHAM: My Lords, I beg to move that this House doth agree with the Commons in Amendment No. 1, and also in Amendments Nos. 3 and 6. Nos. 1 and 6 are minor consequential Amendments, but No. 3 is a new clause, which is a matter of substance. As this is a matter on which your Lordships spent a great deal of time, and as I do not think the reasons for this new clause have yet been fully explained, I hope your Lordships will bear with me if I spend some time on them.
This new clause replaces a clause (Clause 6) which was deleted in your Lordships' House at the Report stage against the advice of the Government. It partially defines the expression "with the intention of permanently depriving the other of it" in the basic definition of theft in Clause 1(1). A clause for this purpose was reintroduced into the Bill at the Committee stage in another place, and amended there on Report to take account of criticisms which the noble and learned Lord the Lord Chief Justice, the noble and learned Viscount, Lord Dilhorne, and the noble Viscount, Lord Colville of Culross, had made of the earlier version.
The object of the clause is to ensure that the new definition of theft will be construed as covering certain cases which are theft under the existing law although the appropriator of the property does not literally intend to deprive the owner permanently. Examples are where the taker intends to abandon the property in circumstances such as that the possibility of its return to the owner is to his knowledge extremely remote; where he intends to return it only after using it in such a way that it has become useless to the owner—for example returning a railway ticket after travelling on it; or where he intends to sell the property back to the owner as being the taker's own property.

1399
Although there was no corresponding clause in the draft Bill annexed to the Criminal Law Revision Committee's Report the Committee made it clear in paragraph 58 of the Report that they intended such cases to be covered by the new definition of theft. They said that they had thought of including a provision in the draft Bill to cover them expressly but that their general view was that this would be unnecessary; and they also said that such a provision would be difficult to frame. The Government share the Committee's view that the cases should be covered, and although they recognise the difficulty of framing an appropriate provision it remains their view, as it was when the Bill was introduced in your Lordships' House, that the balance of argument is firmly in favour of covering them expressly. The Government's decision to propose an express provision was reached after consultation with the Chairman and several other members of the Criminal Law Revision Committee.
There are two main reasons for departing from the Committee's conclusion that an express provision was unnecessary. In the first place, when the Committee reported the Government had not embarked on the codification of the criminal law of which the first steps were mapped out in the Law Commission's Second Programme. In the light of the decision to have a criminal code, the Bill ought to be as complete a statutory statement as is practicable of the law of larceny. But, in addition, since Clause 1 of the Bill redefines larceny, some doubts have been expressed as to whether, in the absence of an express provision, the courts would interpret the new definition of theft as including the cases in question. Those cases were recognised as amounting to theft before there was any statutory definition of theft and have continued to be so regarded since the statutory definition of theft in section 1 of the Larceny Act 1916. But that Act was known not to be intended to change the law, whereas the present Bill makes major changes. Therefore the Government do not think it safe to assume that the courts will continue to give the same interpretation to the definition of theft in the new Act.
1400
Additionally, there is a need to cover specifically certain cases dealt with in subsection (3) of the former Clause 6 which the Government carried by Amendment at the Committee stage in your Lordships' House. That provision (which is reproduced in subsection (2) of the present clause, which I ask your Lordships to approve) was included to make it clear that Clause 1 is intended to cover certain special types of cases where there may not be a positive intention permanently to deprive but where a person entrusted with property deals with it in a manner differently from that for which it was entrusted to him and in a way which seriously endangers the owner's prospects of recovering the property. These cases amount to larceny or fraudulent conversion under the present law, but the position might be open to doubt if there were not a specific provision about them in the new Bill.
The main criticisms which were made of the former clause by the noble and learned Viscount, Lord Dilhorne, and others in your Lordships' House were not that its intentions were wrong but that it failed to fulfil them. At the Report stage, however, the noble and learned Viscount, Lord Dilhorne, after successfully moving an Amendment to delete Clause 6, said:
"I understand that the noble Lord"—
He was referring to me:—
"will not seek at a later stage to reintroduce Clause 6 in the form that has now been excised. Does that mean—I hope it does not—that he is not giving consideration to an entirely different wording to carry out the intentions which he said lay behind Clause 6." —[OFFICIAL RFPORT, 8/4/68, col. 114.]
The present clause meets specific criticisms made of the original clause in the House of Lords. In particular, the concept in the former clause of "complete usurpation" has been replaced by the concept of an intention to treat the thing as one's own to dispose of "regardless of the other's rights", and the final words of subsection (1) make it clear that it does not cover mere borrowing or lending—a point on which the original clause was misunderstood. The noble and learned Lord the Lord Chief Justice suggested in Committee that the original clause might be read as covering, for example, ordinary borrowing of a bicycle or

1401
the taking of a picture or a motor car the present clause meets this criticism.
Subsection (1) of the clause provides that a person appropriating property belonging to another without meaning the other permanently to lose the thing itself is nevertheless to be regarded as having the intention of permanently depriving the other of it if his intention is to treat the thing as his own to dispose of regardless of the other's rights. It would be for the courts to decide in the circumstances of any particular case whether the person appropriating the property had such an intention, but the Government consider that the provision will effectively embody the desired notion of a total conversion to one's own use and will preserve the law substantially as it is now. Thus, if, for example, a person takes a railway ticket intending to return it after travelling on it, or takes property intending to sell it back to the owner as being the taker's own property, he will clearly intend to treat it as his own to dispose of regardless of the other's rights.
In addition, subsection (1) provides that a borrowing or lending another's property may amount to treating the property as one's own to dispose of regardless of the other's rights if, but only if, it is for a period and in circumstances making it equivalent to an outright taking or disposal. This removes any room for misapprehension that the clause is intended to cover mere borrowing or lending. But the exception by which a borrowing (or lending) may amount to treating the property as one's own in the way mentioned, if it is for a period and in circumstances making it equivalent to an outright taking or disposal, will secure that it shall not be a defence that one intended to return the property, say, years later.
Subsection (2) provides, without prejudice to the generality of subsection (1), that where a person having possession or control, whether lawfully or not, of property belonging to another parts with the property under a condition as to its return which he may not be able to perform, this amounts (if done for purposes of his own and without the other's authority) to treating the property as his own to dispose of regardless of the other's rights. The effect of subsections (1) and (2) together is that a person who appropriates property with the intention to part with it under a con-
1402
dition such as is mentioned in subsection (2) will have an intention permanently to deprive the owner of the property for the purposes of Clause 1 of the Bill. The type of case covered by the subsection is one where the person having possession of another's property pawns it and spends the proceeds, and his ability to redeem the property is in doubt.
My Lords, I apologise for having dealt with this matter at some length, but I am aware that there are a great many people who will read this and I hope, therefore, that you will agree it should have been said. My Lords, I beg to move.
Moved, That this House doth agree with the Commons in the said Amendments (Nos. 1, 3 and 6).—(Lord Stonham.)
11.34 a.m.
VISCOUNT COLVILLE OF CULROSS: My Lords, I do not think the noble Lord, Lord Stonham, need apologise for his explanation. As the noble Lord has said, this particular clause was not of course the result of a draft by the Criminal Law Revision Committee, and it poses problems of diabolical complexity in drafting which I do not think were overcome in the first place. One obvious advantage of the form in which it has now been put in the Bill that the language, I think, measures up to the clarity of the rest of the language in the Bill. I do not think that people really liked the idea of "complete usurpation", although it has a respectable legal origin dating from the middle of the 19th century, and I do not think that the intention was nearly so clear before as it now is.
I do not want in any way to repeat or expand upon the noble Lord's explanation because it was very full, and I think it now justifies the insertion of the new clause in the Bill, with the two consequential Amendments in Clause 1, and the application to the "criminal deception" concept later on in the Bill. I think that this is not an occasion when I want to pull the Government's leg any more—it has been pulled enough already on this Bill. Even on a matter of this technicality, when it is as important a subject as theft in the criminal law, it is amazing how

1403
Parliament can improve even upon the most expert drafting by the most expert lawyers. I think that what has happened here is yet a further example of how worth while it has been to subject the whole of this Bill to detailed criticism in Parliament. I am quite sure that, even after all the Amendments which the Government have now accepted in another place, as well as those which they accepted here, have gone into the Bill, the Government will bear no more rancour against those who were bold enough in the first place to suggest that there might be criticisms, and will agree that the Bill is a great deal better now than it was originally. This new clause is justified, and we shall all look with great interest to see what the courts do with it.
On Question, Motion agreed to.
COMMONS AMENDMENT
[No. 2]
Clause 4, page 3, line 18, to leave out from "possession" to the end of line 20.
LORD STONHAM: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 2. This Amendment deletes the provision in subsection (4)(b) of Clause 4 making it theft dishonestly to take a wild creature for reward or sale or other commercial purpose. In consequence, a wild creature, not tamed nor ordinarily kept in captivity, will be capable of being stolen only in the circumstances covered by paragraph (a) of the subsection. This Amendment was made to meet criticisms of the commercial test expressed both in the House of Lords, notably by the noble and learned Viscount, Lord Dilhorne, and by the noble Viscount, Lord Colville of Culross, and in another place.
The arguments for and against making poaching theft are, as the Criminal Law Revision Committee recognise, nicely balanced, and the balance as it left the House embodied the compromise proposed by the Committee—that is to say, that poaching should, in effect, be theft only if done for a commercial purpose. The Government, after considering the criticisms made of the subsection, came to the conclusion that theft should not be extended to poaching even to that limited extent. In reaching their conclusion the Government had much in
1404
mind that, traditionally, poaching has never carried the stigma of theft, and that the Criminal Law Revision Committee did not know of any other country where wild creatures are in general the subject of theft. Poaching is not, for example, theft in Scotland, New Zealand, France, Germany or South Africa.
The Government do not underrate the mischief that can be caused by large-scale poachers, such as those who strip shoots for commercial purposes or take salmon on a large scale. But against this mischief they have had to balance the effect on rural opinion of making it theft, for example, to take without the landowner's consent a few rabbits running wild in the fields, in order to sell them. The Government came to the conclusion that to strengthen the law against poaching to the extent of treating such creatures as property which could ordinarily be the subject of theft would be out of line with modern attitudes towards it, particularly as the effect would be to replace the mostly minor penalties for poaching by the maximum of ten years' imprisonment for theft. My Lords, I beg to move.
Moved, That this House doth agree with the Commons in the said Amendment (No. 2).—(Lord Stonham.)
VISCOUNT COLVILLE OF CULROSS: My Lords, I shall not weep at the demise of the commercial test in Clause 4. I never liked it and I thought that it was going to be as difficult to deal with in practice when it related to animals as I still fear that it will be in relation to flowers. Flowers are still covered by this test, and this, again, will be something which Parliament will want to watch as it is dealt with day to day—or perhaps not so often as that, but on rarer occasions in the courts. With the balance being so finely drawn as it is in regard to poaching, I consider that this Amendment is justified and that, as and when the game laws (not, as was stated in another place, the gaming laws, which I believe have a different context) are looked at, that may be the time when any anomaly can be cleared up. Meanwhile, I would support the Amendment. Although it is probably a compromise on Clause 4 it is a good one.
On Question, Motion agreed to.
COMMONS AMENDMENT
[No. 4]
Clause 10, page 5, leave out lines 29 to 31 and insert "that the public's access to a building is limited to a particular period of particular occasions; but where anything removed from a building or its grounds is there otherwise than as forming part of, or being on loan for exhibition with, a collection intended for permanent exhibition to the public, the person removing it does not thereby commit an offence under this section unless he removes it on a day when the public have access to the building as mentioned in subsection (1) above."
LORD STONHAM: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 4. This Amendment makes changes in subsection (2) of Clause 10, which deals with the removal of articles from places open to the public. We are back to Goya. The need for some Amendment to the clause was foreshadowed by myself when the Bill left your Lordship's House. The main change made here is that the Amendment puts a limit upon protection given where the thing taken is not part of a collection intended for permanent exhibition to the public. The clause as it left your Lordship's House would have protected a place to which the public had occasional access, perhaps only on certain days of the year, from the removal of an article even by a servant, guest or trespasser, at any time of the year, even if the removal had nothing to do with the public's occasional access to the building; whereas the servant, guest or trespasser in a building which is never open to the public could not commit an offence under the clause. This seemed to the Government an unsatisfactory, and indeed absurd, result. The clause secures a limitation by providing that unless the thing removed forms part of, or is on loan for exhibition with, a collection intended for permanent exhibition to the public, the person removing it does not commit an offence under the clause unless he removes it on a day when the public have access to the building.
The Amendment makes further improvements in the clause by referring specifically to things on loan for exhibition with a collection intended for permanent exhibition, making it clear that the clause would cover articles on loan to an exhibition. Secondly, the Amendment, by limiting the clause to days when the building is open to the public, prevents the question from arising
1406
whether a building to which the public were admitted only occasionally would be deemed to be one to which they had "access".
Moved, That this House doth agree with the Commons in the said Amendment.—(Lord Stonham.)
VISCOUNT COLVILLE OF CULROSS: The use of this clause is going to be another rarity, but one way or the other one cannot avoid anomalies. Ono has now the position where somebody who, for some reason, stays after midnight and takes the thing away the next clay is not caught. On the other hand, the number of times when this will not be theft, particularly now that we have back in the Bill the new clause which was dealt with at the beginning of these proceedings, will be most unusual. It was plain that the matter was not right when it left this House, and the anomalies which arose in the circumstances then have been described by noble Lords. I think that the anomalies now are fewer, and, this provision being experimental, it is something which again will have to be watched. It is a new offence and a very unusual one. I am very content that it should now proceed on this new basis.
On Question, Motion agreed to.
COMMONS AMENDMENT
[No. 5]
Clause 12, page 6, line 40, at end insert "dishonestly".
LORD STONHAM: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 5. This is a purely drafting Amendment to Clause 12, "Abstracting of electricity". It inserts "dishonestly" at the end of line 1 so as to make it clear that the word applies throughout the clause.
Moved, That this House doth agree with the Commons in the said Amendment.—(Lord Stonham.)
On Question, Motion agreed to.
COMMONS AMENDMENT
[Nos. 7 to 9]
Clause 15, page 7, line 41, leave out from beginning to "a" in line 42, and insert—
"(2) The cases in which".
Clause 15, page 8, line 2, leave out "in any case" and insert "are cases".
Clause 15, page 8, line 5, after "is" insert "reduced or".
LORD STONHAM: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 7, 8 and 9. These Amendments make changes in Clause 15, "Obtaining pecuniary advantage by deception". The effect of Amendments 7 and 8 is to make subsection (2) of the clause an exclusive definition of the type of case to which the clause applies instead of the list of examples of the general proposition in subsection (1). The third Amendment slightly widens the application of the clause.
Moved, That this House doth agree with the Commons in the said Amendments.—(Lord Stonham.)
VISCOUNT COLVILLE OF CULROSS: This clause deals with another subject on which there was a slight dispute in this House, and I am not surprised that the Government have reconsidered the question of "exclusivity" or "inclusivity". When one takes into account changes in the Repeals Schedule, it looks as though this is now a restatement of the existing law, albeit in a much changed and simplified form. So long as the Government are satisfied that they have covered all possible circumstances—and I imagine that that is the case—I feel that this is another experiment which should be allowed to go forward under the Bill to see whether or not it works. I have little doubt that it will.
On Question, Motion agreed to.

COMMONS AMENDMENTS
[Nos. 10 and 11]
Clause 16, page 8, line 30, after "is" insert "or may be".
Clause 24, page 11, line 37, after "committing" insert "a".
LORD STONHAM: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 10 and 11. These are both drafting Amendments.
Moved, That this House doth agree with the Commons in the said Amendments.—(Lord Stonham.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[Nos. 12, 17, 18, 39, 41, 42 and 43.]
Clause 27, page 15, line 4, leave out from second "of" to "(which" in line 6 and insert "sections 30 and 42 of the Criminal Appeal Act 1968"
Schedule 2, page 25, leave out lines 19 to 30.
Schedule 2, page 26, line 13, at end insert—

"The Firearms Act 1968 (1968 c. 27)

Schedule 1 (offences in connection with which possession of a firearm is an offence under section 17(2)) shall be amended, except in relation to a person's apprehension for an offence committed before the commencement of this Act, by substituting for paragraph 4—

'4. Theft, burglary, blackmail and any offence under section 11(1) taking of motor vehicle or other conveyance without owner's consent) of the Theft Act 1968':

by omitting paragraph 7: and by substituting in paragraph 8 for the words 'paragraphs 1 to 7' the words 'paragraphs 1 to 6'."

Schedule 3, page 32, leave out lines 45 to 52
Schedule 3, page 33, leave out lines 8 and 9 leave out lines 37 and 38.
Schedule 3, page 33, line 59, at end insert—

"1968 c. 19.

The Criminal Appeal Act 1968.

In section 30, in subsection (1) the words from 'and the operation' to 'on conviction', in subsection (2) the words 'or of section 24(1) of the Sale of Goods Act 1893' and the word 'or that subsection as the case may be', and in subsection (3) the words, or of the said section 24(1)'. Section 42(4).

1968 c. 27.

The Firearms Act 1968.

In section 17, subsection (3) and in subsection (5) the words from 'and' onwards."

LORD STONHAM: I beg to move that this House doth agree with the Commons in their Amendments 12, 17, 18, 39, 41, 42 and 43. These Amendments to Clause 27, "Orders for restitution", and Schedules 2 and 3, take account of the passage of two consolidation measures, the Criminal Appeal Act 1968 and the Firearms Act 1968. They merely replace references in the Bill to current criminal appeal and firearm provisions with references to the Consolidation Acts. No changes of substance are made.
Moved, That this House doth agree with the Commons in the said Amendments.—(Lord Stonham.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[Nos. 13–16.]
Clause 30, page 16, line 39, leave out "him" and insert "that person or the wife or husband of that person"
Clause 30, line 40, leave out "him" and insert "that person"
Clause 30, page 17, leave out lines 1 to 3 and insert "in asnwering a question put or complying with an order made as aforesaid shall in proceedings for an offence under this Act, be admissible in evidence against that person or (unless they married after the making of the statement or admission) against the wife or husband of that person"
Schedule 2, page 25, line 15, column 2, leave out from "words" to ""an" in line 17 and insert "following" against that person "there shall be substituted the words" or (unless they married after the making of the statement or admission) against the wife or husband of that person in any proceeding in respect of"
LORD STONHAM: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 13, 14, 15 and 16. Amendments Nos. 13 to 15 amend subsection (1) of Clause 30 which makes provision about the effect of the Bill on civil proceedings and rights, to bring the Bill into line with the Civil Evidence Bill, now in its final stages. Amendment No. 16 alters the Amendment made to Section 166 of the Bankruptcy Act 1914 by Schedule 2 to the Bill, so as to take account of the Civil Evidence Bill. The effect of Amendments Nos. 13 and 14 is to extend the restriction already in the subsection on the privilege against self-incrimination in civil proceedings to the privilege against incriminating a spouse. Whether a witness has a privilege at present of refusing to answer a question on the grounds that this would incriminate his spouse is uncertain, but subsection (1)(b) of Clause 14 of the Civil Evidence Bill gives this privilege. Correspondingly, Amendment No. 15 makes an answer given in civil proceedings to which the subsection relates inadmissible in criminal proceedings under the Bill against the spouse of the person giving the answer as well in such proceedings against that person himself.
Amendment No. 16 similarly extends the inadmissibility of the statement or admission made by a person in any compulsory examination or deposition before a court in bankruptcy proceedings, to proceedings under the Bill against the spouse of the person making it. I beg to move.
Moved, That this House doth agree with the Commons in the said Amendments.—(Lord Stonham.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[Nos. 19 to 38 and 40]
Schedule 3, page 27, line 9, column 3, leave out from "words" to end of line 11 and insert "'exact or'".
Schedule 3, page 27, line 9, column 3, leave out lines 26 and 27.
Schedule 3, page 28, leave out lines 9 to 13.
Schedule 3, page 28, leave out line 16, column 3, at beginning insert "In".
Schedule 3, page 28, leave out line 16, column 3, at end insert "the words 'demands or'".
Schedule 3, page 28, leave out lines 17 and 18.
Schedule 3, page 28, leave out line 38, column 3, leave out "Section 24"
Schedule 3, page 29, leave out lines 5 to 13.
Schedule 3, page 29, leave out line 14, column 3, at end insert "Section 61(2)".
Schedule 3, page 29, leave out leave out lines 20 to 23.
Schedule 3, page 29, leave out Page 30, leave out lines 17 and 18.
Schedule 3, page 29, leave out line 19, column 3, leave out "Section 7(1)".
Schedule 3, page 29, leave out leave out lines 21 and 22.
Schedule 3, page 29, leave out lines 41 to 44.
Schedule 3, page 29, leave out lines 50 to 53.
Schedule 3, line 55, column 3, leave out from "the" to onwards "in line 56 and insert" words "or on conviction on indictment"".
Schedule 3, line 55, column 3, leave out lines 57 and 58.
Schedule 3, line 55, column 3, line 58, at end insert—

"1966 c. 32

The Selective Employments Payments Act 1966.

Section 8(2)(a),(b) and (d) and (ii).

1966 c. 34

The Industrial Development Act 1966.

Section 9.

1967 c. 1

The Land Commission Act 1967.

Section 81(5)(a) Section 93.

1967 c. 9

The General Rate Act 1967.

Section 49(8)."

Page 31, line 4, at end insert—

"1967 c. 22

The Agriculture Act 1967.

Section 69(1)(ii)"

Page 32, leave out lines 26 and 27
leave out lines 53 and 54
LORD STONHAM: I beg to move that this House doth agree with the Commons in their Amendments Nos. 19 to 38 and 40. This is the final group. These Amendments make changes in Schedule 3 (Repeals). The noble Viscount, Lord Colville of Culross, will remember that late at night we had a number of very interesting and useful discussions on these repeals. Some of those discussions were inconclusive, but I assured him that the most careful attention would be given to everything that he had said—and, indeed, it has been—in order that we could make sure that they were fully covered by Clauses 14 and 15.
As a result of the examination of the Schedule—and I am most grateful to the noble Viscount for all the time he took and for the help he gave to us—and further research into possible repeals in recent legislation, Amendments Nos. 19, 26, 28, 35, 38 and 40 delete or limit certain repeals, and Amendments Nos. 27 36 and 37 add further repeals. Information can be given about any particular repeal or group of repeals if required.
Perhaps the noble Viscount, Lord Colville of Culross, will forgive me if I mention the principle behind the changes in these repeals. I think it may be said that generally the Bill sets out to repeal enactments which are clearly superseded by the new offences, and, in addition, in order to simplify the law and reduce the size of the Statute Book, repeals are proposed where the enactments, although not completely superseded, can for practical purposes be dispensed with as a result of the new provisions. The application of this principle to particular enactments is sometimes difficult, and depends on the subject matter of the enactments and the extent to which prosecutions are brought under it in practice, so that in some cases an enactment may be proposed for repeal in whole or in part, notwithstanding that a similar enactment is to be repealed to a different extent or not at all. But no difficulty can, in our view, result from the existence of a little overlapping and the general effect will be greatly to reduce this. I beg to move.
Moved, That this House doth agree with the Commons in the said Amendments.—(Lord Stonham.)
VISCOUNT COLVILLE OF CULROSS: I wish it was not just Section 81(5)(a) and Section 93 of the Land Commission Act which we were repealing. The whole Act would be so much better out of the way. But perhaps this is not quite the context for a discussion on that subject. I am grateful to the noble Lord for his explanation, and I have looked at most of the deletions that he has suggested in the Repeal Schedule, as well as some of the additions. I think that in this case it is wise to have been a little cautious. For instance, in the context of gain and loss, about which we had such interminable arguments earlier on, I was never satisfied that the repeals in the Law of Property Act and the Land Registration Act 1925 were anywhere near covered by the Bill, and I am very glad that these have now been taken out. I am sure that they are the most incredibly uncommon things to happen. They do not get covered by the wording, either of Clauses 14 and 15 or of the subsequent clauses, and if there is any doubt on this matter I feel sure it is better to wait until we have the other offence—that is, forgery—considered by some committee and produced as a Bill. If at that stage we can get rid of even more of these old and "bitty" offences in old Acts, so much the better.
In the meantime, I am delighted that the noble Lord has cut down the extent —although he has added other perfectly proper instances of repeals in modern legislation—of some of the more dubious ones that were originally there. I thank the Government for honouring their undertaking to examine this matter, and I myself very much approve of the results.
LORD STONHAM: My Lords, I am most grateful to the noble Viscount for what he has said, and I shall look forward with the keenest pleasure to the next encounter. I am sure he will agree with me that as we were together on this subject at the beginning, it is very pleasant to be together at the end, and that a useful piece of work has been done by your Lordships' House.
On Question, Motion agreed to.

RESTRICTIVE TRADE PRACTICES BILL
11.57 p.m.
THE MINISTER OF STATE, BOARD OF TRADE (LORD BROWN): 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 Brown.)
On Question, Motion agreed to.
House in Committee accordingly.
[The EARL OF LISTOWEL in the Chair.]
Clause 1 [Exemption from registration of certain agreements of importance to the national economy]:
EARL JELLICOE EARL JELLICOE moved Amendment No. 1:
Page 2, line 12, at end insert ("and an order under this section approving an agreement solely concerned with the promotion of a single specific project shall not continue in force for a period exceeding three years.").
The noble Earl said: I think most of us would agree that experience has shown that there is a need for the exemptions machinery provided in Clause 1 of the Bill before us. There is a demand for it from industry. That has been reflected by bodies such as the N.E.D.C. and the Prices and Incomes Board, and it is, of course, a reflection of the contemporary phenomenon of the economics of scale. A typical example came to my attention only a couple of days ago, when I was reading the Business Supplement of The Times, where there was a very interesting article about a project to link by pipeline the ethylene production works of Shell on Merseyside with I.C.I. on Teesside. Now I strongly suspect that such a scheme would probably be caught by the 1956 Act, and it is of a type—I am not saying that this particular scheme would be justified in terms of the national economy—which would be covered by the Clause 1 exemptions machinery. It is quite right, therefore, that there should be this machinery.
However, I think it is equally agreed on both sides of the Committee that the operation of this new machinery will need very careful watching. As I think the noble Lord, Lord Brown, said
1414
in our Second Reading debate, this is latently controversial because it holds within it the seeds of monopoly. Therefore, it is right that there should be proper safeguards. I shall not adumbrate all the safeguards which are written into Clause 1, but there are a couple of very important ones. One is that orders will require to be laid before Parliament giving effect to specific exemptions; and the other is that any Clause 1 order should remain in force only for the period specified in the order itself.
A glance at the Bill will show your Lordships that the period for the operation of the order is not specified in Clause 1 itself, and I think the noble Lord, Lord Brown, argued at Second Reading that that is probably right in the interests of flexibility because these various specific agreements will vary and may require a different timing for the order. I am inclined to question this. I think that flexibility is obtainable in any event since the orders are renewable. This, I should have thought, gives quite sufficient flexibility. I myself feel it is important that with these agreements, some of which can be very important indeed, we should be absolutely certain that the review machinery is operated at not too infrequent intervals. Two years, I think, is laid down in Clause 2. I should have thought that for specific agreements, as envisaged in the Amendment which I am moving, three years would be ample, especially since they can be renewed; and I am therefore suggesting that there should be a maximum period of three years for specific agreements, of course renewable by further order.
I hope that I have explained the purpose behind this Amendment. I do not think we are very far apart on this particular point. I am inclined to feel that it would be better to write in a specific maximum, and that is provided for in the Amendment which I now move.
LORD BROWN: When I read this Amendment I thought that the intention was that there should be a maximum of three years, not renewable. I believe that the wording of the clause would lead to that interpretation. But, laying that aside (because one acknowledges the difficulty in drafting which the other side has), it is essential that exemption should be given for such period as is

1415
sufficient to secure the object of any scheme or project, and no longer; and Clause 1(3) provides for this. There is no point in exempting a project for a shorter period than that necessary to secure the objects of the project, and industry would be unwilling to make agreements if it were not assured of a sufficient period of exemption. This period will vary with the nature of the project, and cannot be determined except in relation to the project itself. Clause 1(3) already provides that exemption shall not exceed the period which appears to the Board sufficient for the purposes for which the order is made.
An example may help to demonstrate clearly to the noble Earl what our objections are. Let us suppose that we are contemplating an agreement for the provision of new capacity. This might involve the building and commissioning of a large new plant—a process which itself may take longer than three years. But the case for exempting the agreement may well extend beyond the construction period—until, for example, a new product has established its place on the market. Industry, I suggest, will just not embark on desirable schemes unless an adequate period of exemption can be granted. They could not be absolutely certain of an extension when it came up for extension. We do not intend to allow exemption for an indefinite period. Indeed, the clause provides that it must be given for the fixed period which is appropriate to the particular case. If the object of the Amendment is to secure that the operation of agreements is reviewed at three-yearly intervals by the making of a series of orders each of no more than three years duration, I submit it is not necessary. The concept of a close watch being kept on the operation of agreements is embodied in Clause 1(4) already, which provides for exemption orders to be revoked if an agreement is not achieving its object or if it is being used for a purpose other than that for which it was intended.
I hope that in the light of those remarks the noble Earl will see fit to withdraw the Amendment, because I believe that if one were to put in this idea of a review every three years as a maximum period, it would put industry in a great deal of difficulty. They could
1416
not be absolutely certain of later extension, and if they were not certain they would be hesitant about involving millions of pounds worth of investment on the assumption that it would be all right—because we know that people can be caught by these assumptions. I therefore think it is somewhat dangerous, and I hope that the noble Earl will withdraw his Amendment.
EARL JELLICOE: The noble Lord is quite right in thinking that it was my intention not to have a period of three years and then a cut-off, but that thereafter it should be renewable by further order. I also agree with him, having looked again at my Amendment, that it would not have this effect, but would amount to a cut-off after three years. It could, of course, be introduced earlier in the clause, when it would have the effect that I have in mind. But I think that the noble Lord has a point, and a real point, when he says that some of these schemes may take more than three years to mature, and that they may he nipped in the bud if the sort of Amendment which I have in mind were accepted because the companies concerned would not have any absolute assurance that the order would be renewed. I think there is a point there, and in view of what the noble Lord has said I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 1 agreed to.
Clauses 2 to 4 agreed to.
Clause 5 [Information agreements]:
On Question, Whether Clause 5 shall stand part of the Bill?
EARL JELLICOE: I should like to put a point on this clause to the noble Lord opposite. It is a point of such infinite complexity that I intend to keep my nose well down on my brief. Under the 1956 Act, where agreements were referred to the courts and the defence was not successful, I understand that the practice was for the parties to give an undertaking to the court. The undertaking usually provided that the parties would not enter into any agreement which was to the like effect and to which Part I of the 1956 Act applied. For example, the undertaking given by parties to a price-fixing agreement would prevent

1417
them from making any new agreement caught by Part I of the 1956 Act which was to the like effect as the price-fixing agreement itself, and in such a case the parties were free to enter into a bona fide agreement providing for the exchange of information as to past prices.
The Bill as it now stands provides in Clause 5(2) that the Board of Trade can direct that Part I of the 1956 Act shall apply to the information agreements described in the Board of Trade order. In other words, when the order comes into effect Part I of the 1956 Act will apply to that class of information agreements. I gather that some concern is also felt that persons who enter into agreements permissible before a calling-up order under the new Act will, after calling-up, not only be required to register but may be found guilty of contempt where they continue to operate such an agreement. I think there is some uncertainty as to whether that is the case or not. In any event, there is the further point that price information agreements, or indeed other information agreements, made subsequent to a calling-up order should not put the parties to it in jeopardy of being in contempt of an undertaking given before a calling-up. This, I think, was not in the contemplation of the Court when the order was made; and although it is obviously quite fair to require parties to register and to defend their agreements before the Court, it is a very different thing to expose them to the risk of proceedings for contempt.
In view of these difficulties I wonder whether, even at this rather late stage, there might not be some provision made in the Bill that undertakings given to the Restrictive Practices Court should not be affected by calling-up orders subsequent to the court order. That is the inquiry on this clause which I wish to address to the noble Lord. I hope that he has understood what I have been saying as well as I, myself, have understood it and I await, with curiosity, his reply.
LORD BROWN: The noble Lord was good enough to give me notice of this question; otherwise I might well have been lost. The short and perhaps oversimplified answer is that this Bill does not really bring about any change in the position of the people to whom he has referred. But that is, as I say, rather an
1418
over-simplified statement and I can add to it at greater length as follows.
Two matters can arise. First, there is the effect of a calling-up order on preexisting information agreements. Court orders and undertakings to the Court are usually in the form that the parties will not make any new agreement to the like effect, to which Part 1 of the Act applies. If the agreement is a bona fide information agreement, we do not see that it can be in contempt of the Court order; because at the time it was made it was not an agreement to which Part I of the Act applied. It might be in contempt, however, if the information agreement had been operated in such a way as to make it, in effect, a restrictive agreement; and as the noble Lord is aware, before this Bill appeared, two firms were fined £100,000 for doing just that. In that event, the information agreement would almost certainly amount to a registrable restrictive agreement because of the mode of its operation. In that event, it would be registrable, and consequently contemptuous, without regard to the event of the calling-up order. It would make no difference to the situation.
The second circumstance is when an information agreement is made after the calling-up order. In that event, if there were any possibility that the agreement could be held to have the same effect as the condemned agreement the parties could seek the leave of the Court to make the agreement under Section 22 of the 1956 Act, as amended by Clause 10 of this Bill. As the noble Lord knows, Clause 10 gives a new ground for making that appeal. The parties would have to demonstrate either that there had been a change of circumstances since their original agreement was condemned or, alternatively, that this new gateway in Clause 10 was relevant to their application. As this gateway has been inserted mainly for the benefit of information agreements, it is likely that it would be relevant.
But unless one or other of these circumstances apply, we should not wish the parties to be free to make the information agreement. If the noble Lord s view were to prevail, and the Bill were amended in some way, they would merely have a free holiday, albeit an uncomfortable one with something serious hanging over their heads, in which to

1419
operate an information agreement which produces the same result as the condemned agreement. If this practice became widespread, the work undertaken since 1956 by the Restrictive Practices Court would have to be done again.
I would end by saying this. If the information agreement is so worked as to be, in effect, restrictive, then it is in contempt, whether this Bill be passed or not. So it would seem advisable not to amend this Bill; because it would get people out of a situation in which they would have been since 1956. I do not think it is the noble Earl's intention to relieve people by this Bill of erstwhile responsibilities for honest conduct. I hope that he will be satisfied with my explanation.
EARL JELLICOE: I should like to thank the noble Lord for his explanation. I understood the first and the last parts of it perfectly. The rest I should like to study in my free, but I hope not uncomfortable, holiday over the weekend. On the whole, I do not think I shall wish to revert to this at Report stage but I should like to reserve that right in the light of having digested this legal mouthful.
Clause 5 agreed to.
Clauses 6 to 8 agreed to.
Clause 9 [Modification of duty of Registrar to take proceedings for investigation]:
LORD BROWN LORD BROWN moved Amendment No. 2:
Page 10, line 7, leave out ("is") and insert ("has been").
The noble Lord said: I hope that it may be convenient to speak to Amendments Nos. 2 and 3 together. Clause 9(1) gives the Registrar of Restrictive Trading agreements a discretion not to refer abandoned restrictive agreements to the Restrictive Practices Court. As the law stands at present he is under a duty to do so. In practice, however, he needs to refer abandoned agreements to the Court only in exceptional cases where it is desirable to secure a court order to prevent the making of a series of short-term restrictive agreements "to the like effect". It was always our intention that the discretion contained in Clause
1420
9(1) should apply to agreements abandoned before the coming into force of the Act, as well as to agreements abandoned after the coming into force of the Act. Indeed, we believe that the clause as drafted secures this result. It has been suggested to us, however, that the use of the word "is" in lines 2 and 3 creates a doubt whether the power applies to agreements abandoned before the coming into force of the Act. In order to remove any possibility of doubt this Amendment replaces the word "is" by the words "has been". I beg to move.
On Question, Amendment agreed to.
LORD BROWN LORD BROWN moved Amendment No. 3:
Page 10, line 8, leave out ("is") and insert ("has been").
The noble Lord said: I beg to move this Amendment formally.
On Question, Amendment agreed to.
12.18 p.m.
EARL. JELLICOE EARL. JELLICOE moved Amendment No. 4:
Page 10, line 15, after ("that") insert ("any of").
The noble Earl said: Amendments Nos. 4, 5, 6 and 7 all affect Clause 9; and if the Committee have no objection I think it may be convenient to take them together. We can discuss them seriatim as we go along. These four Amendments are designed to meet three objects. Again, this is a fairly complex matter but not, I think, as complex as the matter on Clause 5 with which we have been dealing.
First, with the repeal of Section 12 of the Restrictive Trade Practices Act 1956, the Registrar will be no longer authorised to remove from the register particulars of such agreements on which particulars are for the time being entered therein as appear to the Board as having no substantial significance. The wording of the new Clause 9(2) provides for directions from the Board of Trade discharging the Registrar from taking proceedings in the court in respect of that agreement. This relates to the whole agreement and not to the particulars of any agreement. As I see it, the effect is that the Registrar will no longer be able to take in respect of insignificant bits of agreements the action

1421
that he might have been prepared to take under the 1956 Act which we are revising. The consequence, again as I see it, is that parties to a registered agreement may find themselves unable to obtain dispensation in respect of the insignificant parts of it, and will either have to abandon the agreement as a whole or defend it at considerable cost. This inconvenience, which could be a very serious one, could be corrected by inserting the words in Amendments 4 and 6.
That is the first point. The second point is that under the provisions of Clause 9(2) as it stands the Board's powers include discharging the Registrar from taking proceedings. There is, however, no provision in respect of the Registrar being discharged from continuing proceedings which he may have instituted, but which he might not have instituted had the provisions of Clause 9(2) been on the Statute Book. This could be taken care of by substituting the words, "or continuing" between the words "taking" and "proceedings". I hope that the noble Lord is clear as to the purpose behind these two Amendments.
The third matter is one which we discussed on Second Reading when I suggested that it might help firms if some sort of early warning system could be instituted. It might save them a good deal of trouble and expense if they could find out for certain, one way or the other, whether an agreement was so insignificant as to be deemed not to warrant reference. This is covered by the last Amendment, No. 7. In reply to me, the noble Lord was very reassuring. He told us what in practice happens, of the informal contacts which exist between firms and the Registrar, and said he felt that these contacts, which I am sure operate well, would meet the point adequately. Despite what the noble Lord said, I gather that there is still some anxiety among some of the interests potentially affected by the Bill. The Amendment would put the matter beyond any possible doubt. In fact their inclusion would formalise the informal machinery to which the noble Lord alluded on Second Reading. I hope very much that he will be able to accept this group of Amendments. They may not be perfectly drafted, and there may
1422
be parts of them—as they are covering three different objects—which he may feel unable to accept. Alternatively, he may feel that the whole lot are unecessary. However, I should very much like to hear the comments of the noble Lord on these proposed Amendments to Clause 9. I beg to move Amendment No. 4.
LORD ROYLE: There is a very small point to which I wish to refer regarding the printed copy of the Bill which we have this morning. I was trying to understand the noble Earl, Lord Jellicoe, but his words did not seem to apply at all. I find on looking at the Bill that the line numbers 15 and 20 are in the wrong place, so I am assuming that the noble Earl is moving his first Amendment in what should be line 15 and which appears as line 20.
12.25 p.m.
EARL JELLICOE: I am sorry. I thought that I was probably pretty obscure, even without the help of the printers who have made me even more obscure. The noble Lord, Lord Royle, is absolutely right in his assumption. I apologise for not having explained this before. I was assuming that the printers had not made a mistake.
LORD BROWN: I am sorry that the Bill has this error in it. I shall have to give the noble Earl a detailed and fairly complex reply, but perhaps if I made a very simple comment first, it would make the rest more understandable. I shall have to ask the noble Earl to withdraw these Amendments, because if they were accepted they would take us into the field of administrative difficulty and could raise arguments between the Court, the Registrar and the Board of Trade. It is a question of definition and the intermingling of various things. That is the basic reason why I am going to ask the noble Earl to withdraw these Amendments.
It would appear that Amendment No. 4 is designed to enable the Board of Trade to deal with a part, and the Court with another part, of the same agreement. It would appear that the noble Earl's Amendment is based or the assumption that restrictions in registered agreements are all set out distinctly and separately, but in fact this is far from the case. The noble Earl may have in

1423
mind that the Board of Trade have in the past issued directions under Section 12 of the 1956 Act in relation to agreements after they have been considered by the Court. This practice was adopted in one or two cases with the concurrence of the Court, in order to preserve insignificant restrictions which otherwise the Court would have been forced to condemn.
The Court is required to presume that restrictions are contrary to the public interest unless they can be defended on one of the grounds set out in Section 21 of the Act. There were cases where trivial restrictions which did no harm could not be so defended, and consequently in one or two cases the Court, having condemned certain major restrictions in an agreement, has made no order as to the remaining restrictions but left the Registrar to approach the Board of Trade with a view to securing a direction under Section 12 in relation to the agreement as it subsisted after the major restrictions had been condemned. This procedure has not been satisfactory. It has proved workable only by the exercise of a considerable measure of procedural flexibility on all sides.
We think that the new gateway set out in Clause 10(1) could be employed to defend insignificant restrictions. Indeed, one of its purposes was to enable the Court to deal with all the restrictions in an agreement referred to it. If the parties plead the new gateway in relation to insignificant restrictions, the Court will not have recourse to condemning the restrictions as it has hitherto been required to do when none of the gateways in Section 21 were appropriate. We think, therefore, that the Restrictive Practices Court will not be obliged to condemn insignificant restrictions in future because, as I said at the outset, we think that the better course is that when called on to consider an agreement it should consider all the restrictions and that the matter should not be handled partly by the Board and partly by the Court. The Amendment would reintroduce the ideal procedure in an inconvenient form. May I add this? I believe industry would be a great deal better off if the Court did consider all these things and then industry was able to get the insignificant ones withdrawn. Industrialists would know where they
1424
stood. If you tried to separate them there might be consequential intermingling which would be most distressing.
On Amendment No. 5, we consider that if the Board were empowered to make Clause 9 directions after an agreement had been referred to the Court, it would give rise to an undesirable clash between the powers of the Judiciary and of the Executive. Parties to an agreement have an opportunity to amend their agreement to remove any detrimental restrictions before the agreement is referred to the Court. Moreover, again the new gateway in Clause 10 will allow insignificant restrictions, which have no material effect upon competition, to avoid the condemnation by the Restrictive Practices Court in a manner which has, unfortunately, occurred heretofore on occasions.
I will spend a little more time on Amendment No. 7 because I think that the noble Earl wants a reassurance on this point, and I have here a fairly long note. I did touch briefly on this matter during the Second Reading debate. The truth is that the Amendment really serves little useful purpose. No statutory provision is necessary to permit a person to ask the Registrar to make representations to the Board of Trade. Anyone is free to ask him to do so at any time.
The proposal that the Registrar should be under a statutory duty to notify his decision in relation to representatives is, I hope I can show, of no real practical importance. It in no way inhibits the Registrar from instituting proceedings under Section 20 if he desires that agreement must be referred to the Court. The Registrar could technically discharge the obligations imposed by the Amendment by notifying the parties of his decision immediately before serving a notice of reference to the Court. In practice, he notifies the parties of what his intentions are in good time. Moreover, the Amendment does not take sufficient account of the fact that directions under the new power may be revoked, and that the criterion of Section 12 of the 1956 Act has been changed. The Amendment seems more suitable for the once and for all type of direction which was available under Section 12, but which could not be revoked.
When the matter was touched on in our Second Reading debate, I explained

1425
that in his first Report the Registrar said:
"Whether or not the parties request it, the possibility of making a representation under Section 12 is always considered before an agreement is referred to the Restrictive Practices Court."
The Registrar has assured me that this is still his policy, and he will continue it when Clause 9 replaces Section 12. He regards it as of importance that public money and the time of the court should not be wasted by inappropriate references. Moreover, there is no reason why firms or associations desiring to enter into a registrable agreement or making a recommendation should not approach the Registrar quite informally in advance with a prior indication of the likelihood of its becoming a successful candidate under Clause 92. How clear an indication can be given in any particular case must depend on all the circumstances, including the restriction of competition which is contemplated, and the extent to which a full explanation can be made of just what is envisaged.
But short of a binding promise, which plainly cannot be given, and is not, I imagine, expected, noble Lords may certainly take it that the Registrar will be as helpful as he can. When he makes a representation to the Board of Trade it is likely that directions will be issued fairly rapidly thereafter, because experience has shown that the Registrar with his expertise is able to gauge fairly accurately the sort of agreements in relation to which the Board of Trade are prepared to exercise their powers under Section 12, and is equally likely to be able to gauge which agreements will be eligible for direction under the new powers.
I hope that this is reassuring to the noble Earl. My main point is that if this Amendment were carried I do not think it would be helpful to industry. The Registrar has this pile of agreements before him. He is going through them as rapidly as he can. He is open to approach. He will give decisions as rapidly as he can; he cannot always be decisive. There is nothing in the Amendment which will cause him to be more helpful than he is. It will put him under a statutory duty to do what he is already doing as well as he can, and it might give people the feeling that
1426
they had rights to immediate answers on questions which were in fact the subject of a good deal of legal investigation, and pretty "dicey" issues at that; and he could not respond by giving immediate answers whether or not the Amendment was passed. In the light of this explanation, perhaps the noble Earl could reconsider the Amendments, and I should be obliged if he would withdraw them.
EARL JELLICOE: I think I made a mistake in suggesting that we should take these Amendments together, because, although they all relate to the same clause and are all interlinked in a certain way, the objects are a little different. I apologise to your Lordships. I should like, again, to say how grateful I am to the noble Lord, Lord Brown, far the great care he has taken in preparing his replies to these Amendments, and I can tell him straight away that I am going to follow his advice and withdraw them at this stage. I say "at this stage", because I wish to study carefully the comments he has made on what are pretty complex matters. I think it is necessary that we should get this Bill—which is a very important one, and which has come very late in the day in our Session—as right as we possibly can. I certainly wish to assure myself that we have Clause 9 right before we let it through. Therefore, I should like to reserve my right to come back to this on Report, if necessary, but I will not do so unless I feel it is necessary.
I am very sympathetic to what the noble Lord said on Amendment No. 7, that he did not really feel that in his judgment it would serve the best interests of industry. Clearly this is important. I should also frankly say that I have less sympathy for the argument which he advanced at the start of his reply, that I should not pursue these particular Amendments because of the administrative difficulties which they might cause for the department concerned. That is a reason which does not carry great conviction with me, and in fact, far from allaying any anxiety that I might have, it set a number of alarum bells ringing in my mind.
LORD BROWN: I should have made it clear that it is not a question of departmental administration. It is a question of arguments between the courts

1427
and the departments, which should be avoided at all costs, if possible.
EARL JELLICOE: I agree that arguments between the courts and departments should be avoided if possible. But I think it is equally important that we should be certain that we have this clause right. However, that said, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 9, as amended, agreed to.
Clause 10 agreed to.
LORD BROWN LORD BROWN moved Amendment No. 8:
After Clause 10, insert the following new clause:
Wholesale co-operative societies
.—(1) Subsection (6) of section 6 of the Act of 1956 (which relates to agreements made by trade associations) shall not apply to any industrial and provident society approved by the Board of Trade for the purposes of this section; and an industrial and provident society so approved shall be treated as not being a trade association for the purposes of subsections (3) and (5) of section 8 (excepted agreements) of the Act of 1956.
(2) The Board of Trade may, if they think fit, approve for the purposes of this section any industrial and provident society which, in the opinion of the Board, satisfies the following conditions namely—

(a) that it carries on business in the production or supply of goods or in the application to goods of any process of manufacture; and

(b) that its shares are wholly or mainly held by industrial and provident societies, being retail societies or societies whose shares are wholly or mainly held by retail societies.

(3) The power of approval conferred by subsection (2) of this section shall not be exerciseable after the end of the relevant period, that is to say—

(a) in the case of a society which immediately before the commencement of this Act is registered or deemed to be registered under the Industrial and Provident Societies Act 1965 or under the corresponding law in Northern Ireland, the period of three months beginning with the commencement of this Act;

(b) in the case of a society which is so registered after the commencement of this Act, the period of three months beginning with the date on which it is so registered.

(4) Where an agreement made before the commencement of this Act by an industrial and provident society is subject to registration under Part I of the Act of 1956 but would not have been subject to registration thereunder if subsection (6) of section 6 of
1428
the Act of 1956 had not been enacted and the society had at all times fallen to be treated as not being a trade association for the purposes of subsections (3) and (5) of section 8 of that Act, the agreement shall cease to be subject to registration under the said Part I if that society is approved by the Board of Trade for the purposes of this section.
(5) In this section—
'industrial and provident society' means a society registered or deemed to be registered under the Industrial and Provident Societies Act 1965 or under the corresponding law in Northern Ireland;
`retail society' means a society which carries on business in the sale by retail of goods for the domestic or personal use of individuals dealing with the society, or in the provision of services for such individuals;
'the corresponding law in Northern Ireland' means the law for the time being in force in Northern Ireland for purposes corresponding to those of the Industrial and Provident Societies Act 1965."
The noble Lord said: I apologise to your Lordships for producing a lengthy and complex Amendment at this late stage. The object of this new clause is to relieve Federal Co-operative Societies from certain of the disabilities which they suffer as a result of their falling within the definition of a trade association in Section 6(8) of the 1956 Act.
Subsection (1) defines those sections of the 1956 Act upon which the new clause operates. These sections are Section 6(6), which provides that an agreement made by a trade association is to be regarded as an agreement made by all the members of the trade association so that any restriction accepted by the association is to be regarded as accepted by all the members; Section 8(3), which provides that bilaterial exclusive dealing agreements are not to be registrable unless either of the parties to it is a trade association; and Section 8(5), which provides that bilateral agreements for the exchange of information relating to the operation of processes of manufacture are not to be registrable unless either of the parties is a trade association.
It is to be noted that the subsection does not bite on Section 6(7) of the 1956 Act which deems that a recommendation made by a trade association to its members is to be regarded as a binding agreement made by all the members of the association. Subsection (2) defines the type of Co-operative Society which is to benefit from the exemption. Although the

1429
type of society is narrowly defined, the Board of Trade are given a discretion to decide whether any particular society falls within the definition. The type of Co-operative Society which is to enjoy the benefit of the clause is defined as an industrial aid provident society that carries on business in the production and supply of goods et cetera, and whose shares are wholly or mainly held by other industrial and provident societies who are either themselves retail societies or federations of retail societies.
Subsection (3) limits the period in which the Board of Trade may grant their approval. In the case of an existing society the period is three months from the date of the coming into force of the Bill, and in the case of a society registered after the commencement of the Bill within three months of registration. Subsection (4) deals with agreements made before the coming into force of the Bill. It provides that past agreements of the type which are to benefit from the new clause shall cease to be registrable once the Board of Trade have granted approval to the society in question. Subsection (5) defines an industrial and provident society by reference to the relevant legislation, and a retail society by the type of business which it carries on. It also deals with the application of the provision to Northern Ireland.
The main purpose of proposing this new clause is simply that it has now been discovered that a co-operative society, particularly the Co-operative Wholesale Society, rather surprisingly, has fallen within the definition of "a trade association" since 1956; and that if in fact this new clause is not introduced the Society, and others of a like kind, will be placed in a situation where their agreements to buy from suppliers which are of an exclusive sort will all have to be registered in future. It is to relieve the Co-operative Wholesale Society and others from this, I submit, unintended and onerous result of the 1956 Act that this new clause is now introduced. I beg to move.
Amendment moved—
After Clause 10, insert the said new clause.—(Lord Brown.)
EARL JELLICOE: I am grateful to the noble Lord for his explanation. As he said, it is rather surprising that we
1430
should be faced with what is after all a pretty substantial Amendment to this Bill at a pretty late stage. But I should like to say that my colleagues are grateful to the noble Lord for having given us as much advance warning of his intention as I think he could. I believe that this Amendment is acceptable in that it is only restoring the position which until very recently I think everybody thought already obtained. I hope that this is right, and I believe it to he so.
I have only one doubt which I should like to ventilate and upon which I hope the noble Lord may be able to give me some assurance. This situation has arisen rather unexpectedly, I understand and I am worried that perhaps other equally worthy trading organisations, which up to now have thought that they were excluded from the operations of Section 6(6) of the 1956 Act, may also find themselves within the toils of teat Act and possibly may not be covered by the knew clause. I wonder whether the noble Lord can give me any assurance on this point. Also, on a relates point, if unexpectedly—and there has be en one unexpected result already—this should prove to be the case, what remedy will there be after this Bill has become an Act?
There is, of course, one possible remedy, and that is that we she uld he alerted before it becomes an Act. There is very little time, since we are taking the final stages of the Bill, I think, next Wednesday, but I hope that the interests affected will be aware of the action which we are proposing to take to-day.
LORD BROWN: I think I can give the assurance the noble Earl is seeking. There are two types of case. One is where a series of retail traders join together and literally form an association to purchase on their behalf, and if that purchasing organisation which they have got themselves together to form make exclusive contracts they will be caught by the Bill. On the other hand, there are now, I understand, a large number of wholesaling houses which male contracts of various kinds with large numbers of individual retailers and which agree to service them by buying on their behalf and stocking them. Having taken serious legal advice on this matter, I am assured positively that these types

1431
of operation would not be caught by this Bill. I am quite positively sure on that account.
I have tried to be fair in saying that those retailers who form themselves into a body are inevitably a trade association; but if the formation activities, so to speak, come from the wholesaling end and the wholesaler makes these individual contracts with a large number of retailers, and gets on with his business in the way that a number of wholesalers have done, he will not be caught by this Act. I believe that that is the reassuring point the noble Earl wanted me to make.
On Question, Amendment agreed to.
Clauses 11 to 16 agreed to.
Schedules 1 and 2 agreed to.
Schedule 3 [Enactments Repealed]:
LORD BROWN LORD BROWN moved Amendment No. 9:
Page 16, line 10, after ("order") insert ("made").
The noble Lord said: Lines 9 and 10 of Schedule 3 misquote the words in the 1956 Act which are to be repealed. The misquotation consists of the omission of the word "made". The object of this Amendment is to rectify this omission. I beg to move.
On Question, Amendment agreed to.
Remaining Schedule, as amended, agreed to.
House resumed by the Lord Chancellor: Bill reported, with the Amendments.

SMALL FARM (BUSINESS MANAGEMENT) SCHEME 1968
12.47 p.m.
LORD HILTON OF UPTON: My Lords, I beg to move, That the Small Farm (Business Management) Scheme 1968. a draft of which was laid before this House on July 3, 1968, be approved. I trust that it will be convenient when dealing with this Order to deal also with the Small Farm (Business Management) (Scotland) Scheme 1968. As foreshadowed in the Annual Review White Paper last March it is proposed to renew these Schemes for a further twelve months from September 1, 1968.
1432
Your Lordships may wish to be reminded briefly of the terms of these Schemes which are open to small farmers occupying holdings of between 20 and 125 acres and where the size of the business is between 250 and 600 standard man-days a year. A farmer who carries out an approved programme, designed to increase the efficiency of his business, over a period of three years can obtain grant up to a maximum of £1,000. He must keep specified farm records on which he can base future farm management decisions. Programmes may be either complete, providing for the attainment of objectives in each of the three years of participation as well as the maintaining of records, or basic, with provision for record keeping over the three years but objectives for the first year only. Most basic programmes are subsequently modified to include objectives for the second and third years after the first year's records become available.
The new Scheme is in all major respects the same as the 1965 version, the only changes, apart from minor drafting amendments, being concerned with relations to other Schemes. These relate mainly to the Farm Business Recording Scheme which was not in existence when the 1965 Business Management Scheme was made. We have made provision that grant may not be obtained through concurrent membership of both Schemes, since both are based on the keeping of records; and we have made it a requirement that farmers who have received grant under the Farm Business Recording Scheme must undertake a complete programme. I think your Lordships will agree that those who have already had assistance in this field should have the experience and the necessary records to enable them to embark on a full three-year programme from the outset. Arrangements have also been made to prevent a farmer from obtaining double grant by participating simultaneously in the 1965 and the new Business Management Scheme.
The response to the current Scheme has been rather less than we hoped. This is a pity because inquiries through the National Agricultural Advisory Service satisfy us that those who are taking part are learning a good deal, and the efficiency of their businesses is being substantially increased. The Farmers' Unions have welcomed the renewal of

1433
these Schemes, which will be subject to further consideration at the next Annual Review, and the Schemes were given a welcome in the Commons on July 18. My Lords, I commend these Schemes for the approval of the House. I beg to move.
Moved, That the Draft Small Farm (Business Management) Scheme 1968, laid before the House on July 3, be approved.—(Lord Hilton of Upton.)
12.50 p.m.
LORD NUGENT OF GUILDFORD: My Lords, I thank the noble Lord, Lord Hilton of Upton, for telling us something about the Scheme and how it is working, and from these Benches I welcome it as a useful little Scheme which will give help to the small farmer.
In farming today all profit margins are under great pressure, and that is especially so with livestock producers. Normally it is livestock production which is the basis of the small farmer's living. Therefore his income has been stationary, or has even shown a downward trend in recent years compared with the rising trend of the rest of the community.
As the noble Lord has said, the response to this Scheme has been rather less than the Ministry of Agriculture, Fisheries and Food had hoped, and I believe that the total numbers who have taken up the Scheme are of the order of 5,600, against a potential, estimated to be about 40,000 units, which might be eligible for the Scheme. This is disappointing. I entirely agree with the noble Lord that the Scheme is a useful one. Most farmers will get a good deal of benefit from the introduction of sound management systems, if they have not already got them, and this is especially true of the small farmer, who very often does not have them.
This situation, where there is known to be need and the number of applications is so small in terms of the potential, prompts me to ask whether the Ministry has given sufficient publicity to this Scheme, and whether more could be done to publicise its benefits; to explain how it can help and what its practical value is; whether it is possible to arrange "open days" at farms that have taken up the Scheme and where the farmers are willing to co-operate and show what benefit they have received. This is the kind of demonstration which has the
1434
greatest value and is the greatest help. There is no doubt that the small farmer needs all the help we can give him, and although this Scheme is quite small in scope it could have a very great benefit.
I put those thoughts to the noble Lord and ask him if he will take them back to the Minister of Agriculture, Fisheries and Food (and I am sure that Mr. Cledwyn Hughes, coming from Wales, will understand the problems of the small farmer) and ask him whether more impetus could be given to this Scheme.
LORD HILTON OF UPTON: My Lords, I thank the noble Lord, Lord Nugent of Guildford, for the welcome he has given this Scheme. I am not surprised, since the N.F.U. have already welcomed it, as have Members in another place. The noble Lord, Lord Nugent, has had a great deal of experience of different ways of publicising things in the farming fraternity, but I am pleased to tell him that the Ministry have been doing a number of things to try to publicise this Scheme. I know that very often when such Schemes are comparatively new farmers are slow to "catch on", but I can tell the noble Lord, Lord Nugent, what is being done so far.
Press notices and technical articles are being published in the trade Press and a distribution is being made of special leaflets. I hope the noble Lord will think that the one I have in my hand is a very attractive colour. It is rather like some of the literature issued by some political Parties—though not the one in which the noble Lord is especially interested. It is an attractive leaflet, and it contains some very good tips for farmers wishing to participate in the Scheme. These leaflets are being distributed at agricultural shows and meetings of the N.F.U., and similar events. Again, the N.A.A.S. are doing what they can, as usual, to publicise the Scheme, including the arranging of special introductory meetings, both in England and in Scotland, and trying to publicise the Schemes in the agricultural colleges. The suggestion made by the noble Lord that there might be "open days" at farms where the Scheme is already in operation might be well worth while. It has been successful in the case of other Schemes that have been introduced by the Government, and I will certainly put forward his suggestion to my right

1435
honourable friend. I cannot make any promises that it will be carried out, but I think it is a good suggestion. I am grateful for the support which the noble Lord has given to the Scheme.
On Question, Motion agreed to.

SMALL FARM (BUSINESS MANAGEMENT) (SCOTLAND) SCHEME 1968
LORD HILTON OF UPTON: My Lords, I beg to move the approval of the Scottish Scheme.
Moved, That the Draft Small Farm (Business Management) (Scotland) Scheme 1968, laid before the House on 4th July, be approved.—(Lord Hilton of Upton.)
On Question, Motion agreed to.

MEAT AND LIVESTOCK COMMISSION LEVY SCHEME (CONFIRMATION) ORDER 1968
12.59 p.m.
LORD BESWICK: My Lords, I beg to move that the Draft Meat and Livestock Commission Levy Scheme (Confirmation) Order 1968, laid before the House on 2nd July 1965, be approved. The purpose of the Order is to enable the Commission to finance its work. The Order has stimulated a good deal of discussion, both in another place and outside, and the related facts will be known as well to most of the interested Members of this House as they are to me. I do not, therefore, intend going into any descriptive detail. It would be discourteous of me to offer them more words which they have heard or read before. As I understand it, there is agreement on both sides of the House—there was agreement and there still is agreement—to set up this Commission, whose object is to improve the efficiency of the whole of the meat and livestock industry. The argument has been as to how the work of the Commission should be financed. There are some, probably including my noble friend, Lord Royle, who takes a keen and informed interest in these matters, who say that it should be financed out of public funds. I am sorry, but that just is "not on". The Act does not provide for it, and even though there
1436
has been some assistance for work which will become the Commission's responsibility, such as beef recording, there is no alternative to finding future money from the industry itself.
It is proposed that there should be a levy, and a levy applied at the point at which it is most economical to collect, namely, at the slaughterhouse. I emphasise that economy of collection is a real point. One of the arguments which have been advanced against extending the levy to cover imported meat is the argument about the efficiency and economy of collection, although there are, as noble Lords will know, other arguments against putting a levy on imported meat.
My right honourable friends the Minister of Agriculture and the Secretary of State for Scotland have listened very carefully to some of the objections that have been raised, and the rate of levy has been reduced. If it is to be increased again in the future, the Commission will have to come back to Ministers and to Parliament. I emphasise this because those who feel that matters may not work out as intended will clearly be able to express their viewpoint again if the possibility of finding an increased amount of money ever arises. In addition to this control which Parliament exercises, my right honourable friends have given an undertaking to consider representations of the trade if alter a year or so's experience of the scheme it appears that the levy is operating unfairly as between one section of the industry and another. I hope that with these assurances the House will be prepared to approve the Order. I beg to move.
Moved, That the Draft Meat and Livestock Commission Levy Scheme (Confirmation) Order 1968, laid before the House on 2nd July 1965, be approved.—(Lord Beswick.)
1.13 p.m.
LORD ROYLE: My Lords. may I first of all say to my noble friend that I am not one of those people who believe that the money ought to be raised from public funds. In the course of what I have to say, and I hope it will not be too long although I feel rather strongly, that will not be my argument, and perhaps it will come out in what I want

1437
to say that this is the fact. Your Lordships know that in another place this Order was discussed for some hours and into two nights, and as a result it might well seem that in your Lordships' House on a Friday afternoon it is somewhat academic to discuss the matter. I feel, however, that this is something which must be aired in this House and expression made of people's anxieties with regard to the terms of the Order, and therefore I want to oppose the Order in any words that I have to command. My noble friend has not gone into great detail, but he has explained the purposes of the Order, and therefore, even to that extent, I will not repeat what he has said, and so save time. I want to base my arguments on two aspects of the Order: first, that the demands of the Commission for their administration are too ambitious, and, secondly, that the levy is imposed on only one small section of the meat and livestock industry.
On the first point, I for one, and I feel sure most of your Lordships, when giving support to the establishment of the Commission never for a moment envisaged that a sum of money like £1,850,000 for initial purposes would be asked for. Out of that figure £675,000 is in respect of work at the moment being carried out by existing agencies and supported at Government expense. It is now proposed to pay for that by a levy imposed on a small section of the industry; and that is the point I am emphasising. I will spare your Lordships the detailed costs of each item, but I claim that the estimates are exaggerated and excessive and the Commission are endeavouring to set up a new and expensive empire. The Minister must have held this view to some extent when he reduced the levy, for example down to 4s, on cattle, and made proportionate reductions on the smaller animals.
In the second place, and perhaps more important, is the shocking way in which the money is to be raised. The Commission are taking the easiest way, ignoring any equitable method, by making the slaughterers of all animals pay the levy for all the Commission's expenses. The activities of the Commission will range over a very wide field of the meat and livestock industry, from the farm gate down to the retail butcher's shop, and the pyramid contains many levels—farmer, livestock dealer, auc-
1438
tioneer, slaughterhouse operator, local authority abattoir owner, wholesaler, other distributor and retailer—and there are very many farms and very many points of retail distribution.
If the position may be compared to an hour-glass, like the one on the Table of your Lordships' House, the point of slaughter is the neck of the glass, and that narrow neck is the easy spot for the Commission to impose their levy without any regard at all to fairness. It means that the slaughterhouse operator or, as the Order says, a person who presents the animal for slaughter-and in very many cases it is one and the same person; the presenter of the animal and the slaughterer of the animal in so many cases, particularly in private slaughterhouses, is the same person—has to finance the whole gigantic operation while all of us in the meat and livestock industry escape contribution. The producer stands most to benefit from this scheme, but he is not the one who is making the contribution.
During the passage of the Bill through Parliament several statements were made by Ministers in both Houses that the levy system, when it was imposed, would be fair. If the whole of the burden is to be imposed on one small section of the industry and that is regarded as fair, I give up; and I must say I lose faith in my political friends who made those statements.
There are many other elements of unfairness. My noble friend referred to imported meat. Imported meat, a large proportion of our supply of meat in this country, completely escapes the levy, and yet the scheme includes all kinds of meat; and all types of cattle going through that exportation escape. But they will have received subsidies and advantages from the Commission. Animals imported alive apparently will escape the levy, yet they come into the ramifications of the Commission in the same way. The Minister set up several committees to advise the Commission and those committees are statutory. That was done because obviously the members of the Commission are not experts in the industry as a whole. The distribution committee have opposed the levy almost unanimously, and I am informed that it was that opposition that caused the delay in the presentation of the report between

1439
April and early in July. Having opposed it as strongly as they possibly could, the Committee were completely ignored and the Commission came through with the Report out of which this Order arises.
The Distribution Committee is drawn from most branches of the meat distribution trade. But the private slaughterhouse operators have no voice on that Committee. It is true that the local authorities have three representatives. But there are in this country three times as many private slaughterhouses as there are public slaughterhouses. In any case, there are many places where the private butcher merely rents floor space in the public slaughterhouse from the local authority in order to slaughter his animals. According to the Order, these men pay the levy, not the local authority.
I think that there is nothing inherently wrong in the Meat and Livestock Commission being financed by the industry, but the levy should be imposed on all sections. If I were to express a view as to the best method to get the money for the work of the Commission, I would say that it should be tied up with the February Price Review, and that the expenses of the Commission should be taken into consideration during the course of that Review. If this were done, then every section of the meat and livestock industry would become involved and would bear their share of the burden. It is impossible, as was suggested in the debate in another place, for the levy to be passed back by recovering from those who sell the animals. Prices at auctions go up in £5 bids. Without statutory authority, how can you make a deduction of 4s. or 5s, from an auction price on a beast which is costing £100? The levy cannot be passed on to the consumer, when again it would be only 4s. on a beast weighing 800 lbs. and costing £100. It would be real profiteering if any attempt were made to pass it on, because such a small amount could not possibly be passed in proportion to the value of the animal.
There are many other aspects of this matter, but I am conscious that I am talking too long and I do not want to weary the House. This Order received severe criticism from all sides in another place. I had many Lobby conversations
1440
with Members of Parliament during the course of the discussions on the Order, and I have read most carefully the reports. In the course of several hours I could find only one speech from the Back Benches supporting the Minister's contentions. It is true that when the Division was taken there was, I think, a majority of 47 in favour of the Order. But this was clearly a vote on the part of Government supporters out of sheer loyalty to the Minister. There is no doubt about that. This, in spite of so many of them expressing themselves in the debate, and many more having expressed themselves to me as being against the Order. We, as politicians, all know that this kind of thing happens, and that when the Division is called Members are loyal to their own Minister. In my view, this is precisely what happened. But that vote, I suggest, was no indication of the opposition which existed on Tory, Labour and Liberal Benches in another place the other night. I remember quite clearly that one speech in support of the Minister was rather half-hearted.
So the Order has arrived in your Lordships' House, and I am asking my noble friend to take it back for further consideration, and to ask the Minister to produce another scheme which will not hit so heavily one small section of the meat and livestock industry. In any case, this Order should be for one year only. Going back further than the suggestion made by my noble friend, that the trade might be consulted at the end of the year, I would much prefer that the Order should be made for one year aid for one year only, and that it should be mandatory that it be reconsidered at the end of the year. I feel certain that if this were done, the agitation which has been coming from the great proportion of the retail meat trade, from the wholesale trade and many others would be proved right at the end of those 12 months.
I cannot divide the House on this Order. I have memories of what happened when your Lordships threw out another Order in connection with Rhodesia, and all the constitutional problems which arose. Even were there to be a full House, and even had I some support, I should never dare, in these circumstances, to think of dividing the House. So I am appealing to my noble friend's sense of fairness and justice. The meat trade

1441
is up in arms about this Order, and already there is talk of non-co-operation in the scheme as a whole. If the Meat and Livestock Commission is ever to be a success, I suggest that it must have the good will of die traders who will have to operate it. Do the Commission want to run a scheme without the co-operation of the traders? I suggest that they would never hope to do anything of the kind.
If I have spoken for too long, it is only because I feel strongly, having been, although not now, associated with the meat trade for a large part of my life, and I hope that I shall have some sympathy from my noble friend.
1.18 p.m.
LORD NUGENT OF GUILDFORD: My Lords, I have listened with interest to the noble Lord, Lord Royle, expressing the point of view of the butchers and, if I may say so, expressing it well. I feel that he has done us all a service by putting before us that point of view when we are debating this Order. As he reminded us, in another place widespread opposition was expressed to this Order, and indeed finally the House was divided against it. I have therefore considered whether I should advise my noble friends in this House to follow suit. However, I see that most of them are more concerned with eating the product of the livestock than talking about it at this moment.
I recollect that about a month ago the Prime Minister warned this noble House that at an early date it was "for the chopper". Rejecting the Order in regard to the butchers levy might be the right way in which to bring the chopper down. It certainly would provide an opportunity to see what sort of edge the Prime Minister's chopper has. However. with the Commons departing for their "hols" it would hardly be fair to bring them back again to sit next week. Therefore, I shall resist the temptation to join with the noble Lord, Lord Royle, even if he wished to divide the House.
I recall that when discussing Part I of the 1967 Act. I indicated my support in principle for the Meat and Livestock Commission, and I stand by that decision today. The noble Lord, Lord Beswick, will no doubt be relieved to hear that. On the other hand, I am hound to comment that the Minister and the Com-
1442
mission seem to have been outstandingly unsuccessful in putting the Scheme over. If the Commission does its job properly, as I hope it will, it will undoubtedly improve the general marketing of livestock throughout the country for the benefit of producers, distributors, and housewives.
The pioneering work that P.I.D.A. has done gives us an example of what can be done in this field. That being so, I feel that it should be possible to convince farmers and butchers alike that it is in their interests to support it. With regard to the levy itself, on the Committee stage of the Bill last year I did advise the Government that it would be wise to spread it over imported meat as well as over the home-produced meat, and this was a point to which the noble Lord. Lord Royle, adverted. I thought that this would help to make the incidence of the levy more acceptable. I am sorry that in the event that has not been one. I understand that there is power in the 1957 Act for the Minister to do that, and although the degree of benefit for the imported meat is not as great as that for the home-produced meat, it will undoubtedly got some benefit out of the progressive improvements of the structure.
I hope that this point may be considered perhaps in the future as a better method of spreading the incidence of the levy. The noble Lord, Lord Royle, had, I thought, a very cogent point when he said that the incidence of the levy at the point of slaughter seems unfair in its initial impact. I should expect that the cost of the levy will filter through in various ways to the final cost to the customer, to the housewife, over the counter. Just how that will happen I should not like to predict, but I think this is a point which must clearly be watched by the Minister during the coming year. If it appears that the whole impact of this extra cost has fallen direct on the slaughterer, and that the slaughterers' profit margins are thereby directly cut, then clearly some way must be found to spread the cost. I hope that, one way or another, it will be possible to make this levy acceptable to all concerned, producers, distributors, and butchers alike, because we want their co-operation in something which I believe can, in the long term, be beneficial to everybody.
1.24 p.m.
LORD WOOLLEY: My Lords, I support this Order, and I have listened with interest to Lord Royle's moving presentation of the butchers' point of view, and if he says that no one has given it other than lukewarm support, well at any rate I will try to remedy that by giving it full-blooded support. I do so because I know that for very many years this has been a neglected area in the whole agricultural economy, and indeed in the food economy. Livestock products represent the biggest single area in the agricultural economy, and very little has been done until, as the noble Lord, Lord Nugent of Guildford, said, the P.I.D.A. was created, which itself met with very bitter opposition at its outset and very much criticism. But it worked its way through, and to-day it is undoubtedly recognised as a very valuable element in the pig industry.
I believe that this Commission has the potential to do this on a very much bigger scale. I believe that the objective that we must always bid for in the end is consumer service. If it does not do something that is worth while for our customers, the housewives of this country, then I do not think that the Scheme will he durable or justified. However, I believe that it will. In the process I think that the Commission needs to have adequate funds. The noble Lord, Lord Royle, has suggested that the funds are extravagant. I do not go along with that view: indeed, I think it is a very modest sum. I am rather more concerned lest there has been rather too much cheeseparing in leaning over too far backwards to try to meet the opposition that has been aroused. However, I accept that the sum proposed is probably of the right sort of order. People who are concerned have gone closely into it. I see no sign of extravagance whatever; indeed, I believe that this rather small sum of money is very much less than some single pig companies in this country spend annually simply on advertising a product, let alone the whole of the research that is involved for a vast industry of this kind.
On the question of how the money should be raised, there are the alternatives that it could be public money or it could come out of the trading channels. There are many policies that can be
1444
effectively implemented only through the use of public money, and public money on a big scale. I am in no way doctrinaire about this, but I would say that, on the whole, it is better that the funds should be raised by the people who are participating in the Scheme, who are affected by it. There is a greater sense of involvement; there is a greater interest. There certainly will be a greater keenness to scrutinise the work of the Commission if people are paying for it themselves, rather than its coming out of some public largesse.
I do not think the suggestion made by the noble Lord, Lord Royle that the cost should be met from money allocated out of Price Review money, is practicable. If my memory serves me correctly, this is not possible, and even if it were so earmarked, the money would be coming through the Treasury and it would be the very counter, the thing the noble Lord has said he does not agree with.
So we come to the question of who should pay out, and from whom does one collect. I agree entirely with what the noble Lord has said about this being done, so far as is practically possible, on an equitable basis, but he himself has referred to the many elements that are involved in this very great complex. He has talked about the producers and while it is true that in some cases the producer does everything, in that he breeds, rears and feeds the animal—the calf, sheep, pig, whatever the animal may be—and presents it for slaughter, this is not the usual thing. There are quite a number of links in this chain, as the noble Lord knows—indeed he has referred to them.
So if one were to take in all these people, and bearing in mind that the main objective and purpose and justification for any Scheme of this kind is that it will serve the public interest, then it would be necessary to bring in the public too. They are beneficiaries, we hope: if they are not, there is very little purpose in the Scheme. I think it is really beyond the wit of man to devise an administrative system that would allocate the cost equitably as between all these atomised elements in the industry. I think that when it came to administration the whole Scheme would collapse under its own clumsiness and

1445
cost, and this is one of the greatest dangers with Schemes of this sort. They may be very good ideas; but in practice they can create so much cost, so much administrative expense, that the end result is very dubious.
There may, of course, be some who do not want a Scheme at all. There are those who do not think this is the right sort of Scheme. There are many farmers who, for years, have wanted a statutory Meat Marketing Board. The present Scheme, of course, came from the Verdon-Smith Committee, which was set up by the Conservative Minister of Agriculture. Their Report landed on the new Labour Minister of Agriculture's desk, and the Labour Government have carried it forward. This is, as your Lordships know, an agreed measure. There is a good deal of tongue-in-cheek quibbling by some people about it. There are, as I read the debate, a good many people who are doing an expert piece of fence-riding. I have not noticed anybody coming out with any cogent and positive proposals as to how they would do this otherwise than the Government have done it. They are making nice noises to the butchers, no doubt because that is a good thing to do politically, since butchers are effective and important people. That is not what concerns me. I speak as a farmer, and therefore I may he suspected of saying "I'm all right, Jack-let the butchers pay." I assure your Lordships that that is not my intention. I do not wish, nor do the farming community wish, to escape from a fair contribution to the whole exercise. Indeed, I am in no fear that we shall escape it.
The noble Lord has said that the butchers will not he able to pass it back or pass it forward. Knowing my friends the butchers, I am sure that they will pass it somewhere and will not stand as the sacrifical lamb in the bleak wind of this tremendous burden and penalty, which, the noble Lord went on to say, was so small that they could not identify it. Either it is big enough to identify and do something or other about or it is so microscopic that it does not matter. I believe that this levy will work out in the normal trade channels. Sometimes one part of the equation will be a little more and sometimes the other. I am sure that there will be no unfair burden resting
1446
on the butcher, nor should we wish there to be. We want to see equity. I take the noble Lord's simile about the hourglass, which is a good one. You have to find the bottleneck or point at which the animal is transformed into s meat carcase. That is at the point of slaughter. Until that time you do not know what happens to the animal. Once k lied, it becomes meat.
The Meat and Livestock Commission deserve our support, and not our grudging support. They have a difficult job to do in a very complex field. A lot of cold water has been thrown on this matter, I think quite unfairly. It has to prove itself. We shall see, and we shall take a keen interest. I think it is a sound proposition. It will not stand the world on its head; there is nothing dramatic or miracle-working about it, nor do we want that; but it represents steady progress. I think that this is a sensible Order to finance the Commission. I hope that there will be enough money and I do not disagree with the noble Lord, Lord Royle, that if after a period of time the financial requirements grow to a level of large and significant proportions, then an open mind should be kept as to whether or not at that time the Treasury ought to come into it. I do not think that is the case at the moment. I cannot tell what it will he in the future. I wish to support the Order.
12.36 p.m.
LORD BALERNO: My Lords, after the brilliant and comprehensive speech of the noble Lord, Lord Woolley, there is little left for me to say; but in view of the challenge which was issued by the noble Lord, Lord Royle, to those who strongly support the constitution of the Meat and Livestock Commission I feel that it is my duty to make perfectly clear that, so far as I dare to speak for Scotland, I believe that we are 100 per cent. in agreement with what the noble Lord, Lord Woolley, had to say.
In regard to imported meat and whether or not a levy should be pit upon it, I agree very much with my noble friend, Lord Nugent of Guildford. This matter ought to be looked into at some time in the not too distant future. I am not quite sure that it is right that one cannot put a levy on imported meat without giving that meat similar benefits in the market. I do not think that

1447
is a very good argument. What to my mind is a clear argument is that the imported meat is going to compete, with the advantage of not having to pay the levy which the home producer or home processor, the butcher, has to pay. The imported meat will get the benefits of certain of the advertising expertise which the Meat Commission will put in, and sufficient weight has not been given to this point.
The Chairman of the Meat and Livestock Commission, Sir Rex Cohen, is an expert on the retail trade and he has a particular interest in, and knowledge and understanding of, the problems of labelling. If a proper system of labelling meat comes in and helps the housewife and results in the sale of still more meat, then the first people to get on to the band-wagon will be the people who send in meat from abroad. They are in a way better organised than even we shall be under the Meat and Livestock Commission. I wish that people would realise the tremendous advantage of meat importers in being able to grade and regulate their products for marketing in this country.
Unless we have this Meat and Livestock Commission working, and unless we provide them with the money to enable them to work to the full, then obviously our whole industry, not just the producers, will continue to be at a considerable disadvantage. I think that the meat trade is rather sensitive. I share the belief of the noble Lord, Lord Woolley, that there are so many able persons running the meat industry that one cannot believe that they will not discover means of pushing the levy a little way back to the producer or a little way onwards to the consumer. When livestock are in short supply, it will go on to the consumer. When livestock are in full supply, then, as we know from past experience, it will come right back to the producer.
The noble Lord, Lord Woolley, said that a large part of British agriculture is composed of livestock. That applies even more so in Scotland. I believe that in Scotland about 80 per cent. of our total marketed output in agriculture is from animals, and nearly 50 per cent. of that is from meat animals. It is most important that our meat industry should
1448
be properly organised. Bearing in mind the task of getting the industry properly organised, the fundamental research which needs to be carried out, organised marketing, advertising, and the public relations work as between the industry and the rest of the country, if one thinks that 1½ per cent. is a large sum of money for the industry to put aside one has no idea of what is put aside by other industries for those purposes.
LORD NUGENT OF GUILDFORD: My Lords, I do not think it is anything like as much as 1½ per cent. The total value of the livestock industry at the producer end must run into several hundred millions of pounds, and this is a sum of under £1½ million. I should think it is more like one quarter, or 0·1 or 0·2 per cent.
LORD BALER NO: My Lords, I am grateful to the noble Lord, Lord Nugent of Guildford. I realise that I had a "damned dot" one place out. If you take the marketed output of the meat industry it is well over £100 million—that is, taking it from the point of payment by the housewife—the levy being £1·8 million. I am very glad to be corrected by the noble Lord. because it makes my point even more attractive than it was before.
LORD BESWICK: My Lords, my noble friend Lord Royle said that the meat trade was up in arms, and I think it would be generally agreed that they have a very fine champion in my noble friend. But as was seen, the producers also have their champions, and I am not at all certain that when my noble friend entered the lists he quite appreciated what opposition he was going to meet. After the noble Lord, Lord Woolley, had spoken I felt that I could get up and do what I understand a certain statesman did in Bristol on one occasion, and just say "Ditto" and sit down again. But probably I ought to try to answer one or two of the points that have been made.
I was glad to hear my noble friend say that he was not in favour of a public subvention. But if he wants it to come through the Annual Review it is, in effect, a subvention through the back door. I quite agree with the noble Lord, Lord Woolley, that this is only another way of saying that it should come out

1449
of the public purse. My noble friend also made a point about representation of private slaughterhouse owners on the Distribution Committee of the Commission. This is a point which he knows was discussed during earlier proceedings. The fact is that within a Committee of manageable size—and this Committee has 23 members—places had to be found for very many interests. Wholesalers, retailers, processors and others, who, in practice, comprise the operators of private slaughterhouses, are all represented.
What my noble friend was really concerned about was the complaint that money was being extracted for the industry as a whole from this one narrow point. But I agree with the point made by the noble Lord, Lord Woolley—and I think I am right in saying that to some extent it was made by the noble Lord, Lord Nugent of Guildford—that although the money is taken out at one point it will be diffused, or filtered through the whole of the industry, as the noble Lord, Lord Nugent, put it; or the retailers will find some way of "passing the buck" which is virtually what the noble Lord, Lord Woolley, said.
I emphasised at the beginning the economics of this matter. The estimate given to me from the Commission is that the costs of alternative systems of collection will be some three times or more the £125,000 which it is estimated will be the cost of collection under the present scheme. I am bound to say that I did not quite follow the argument of my noble friend Lord Royle, that because the Minister had reduced the rate of the levy, that was an indication of the ambitious character of the Commission, and that they were bent upon empire building. I should have thought the lesson to be drawn from this reduction was quite the opposite, and that no one had any intention of empire building.
LORD ROYLE: My Lords, when the Commission make their original Report they asked for twice that amount, and I was accusing the Commission of empire building—not the Government. It was the Minister himself who reduced the figure.
LORD BESWICK: To the extent that there was this tendency towards empire building, I should have thought it had
1450
been squeezed out by the reduction in the rate of levy which is now proposed. There is one point outstanding, and that is the question of the extension to imported meat. I am bound to say that at first sight one naturally thinks that this would be a fair thing to do. Why should one impose the whole of the levy on the British producer? The fact of the matter is that the British producer himself hopes that the Commission will help his interests.
LORD ROYLE: You are not putting it on the producer.
LORD BESWICK: My Lords, the fact of the matter is that one way or the other we are dealing with British-produced meat, and this is to help the marketing of British-produced meat. The producers themselves say, reading an extract from the Farming Leader—which is the N.F.U. of Scotland's journal—of June 18, that they do not want the levy to be extended to imported meat. In fact, they say:
"We should recall that the Union"—
that is, the N.F.U. of Scotland—
"was instrumental in having sales promotion of home-produced livestock products included in the Commission's terms of reference. It is therefore illogical to expect meat importers to subsidise the promotion of products which are in competition with their trade
They end by saying in this article
"We can do without their contribution."
I think that fairly represents the point of view of the producers.
LORD ROYLE: My Lords, I wonder whether my noble friend will allow me to interrupt him again. It is easy for the producers to say, "We do not want any levy shared by the importing people." They are not paying the levy. It is the easiest thing in the world for them to say that.
LORD BESWICK: My Lords, I am afraid that we are back in square one, and I shall not pursue this any further. The view of the Government, the view of the N.F.U., the view expressed by the noble Lord, Lord Nugent of Guildford, the view expressed by the noble Lord, Lord Woolley, and the view expressed by the noble Lord, Lord Balerno, is that this cost will, one way or the other, filter through or be diffused, throughout the whole of the industry.

1451
There is the point of imports, however, and that is a matter which has been seriously considered. Apart from the point which I have just made, that the British producers themselves do not want it, there are other considerations.
Those who supply us with meat from overseas would not take kindly to a system which imposed a levy upon what they exported to us. There would berepercussions which, in the long run, would not necessarily be in the best interests of this country. In any case, I think it has been generally agreed that it would not be fair to impose the same rate of levy upon imported meat. The rate would have to be smaller, its cost would be greater, and the net result would not be any help to the meat traders, for whom my noble friend Lord Royle has spoken so eloquently. Anyhow, there is a difference of viewpoint. The noble Lord has put his point of view and what we should now agree is that we should see how it works out in practice. If at the end of a year or so it can be shown that it is working out unfairly, then my right honourable friend has given a very adequate assurance that he will seriously consider what is represented to him by the meat trade. I hope, therefore, that we can now see this Commission launched and that we shall wish it well.
On Question, Motion agreed to.

REDUNDANCY FUND INCREASE OF CONTRIBUTIONS ORDER 1968
1.50 p.m.
BARONESS PHILLIPS BARONESS PHILLIPS rose to move, That the Draft Redundancy Fund Increase of Contributions Order 1968, laid before the House on July 16, be approved. The noble Baroness said: My Lords, on behalf of my noble friend Lord Bowles I should like to move the first of the two Orders before your Lordships today, though I shall speak to them both. The effect of the Redundancy Fund (Advances out of the National Loans Fund) (No. 2) Order 1968 is to enable the Secretary of State for Employment and Productivity, with the agreement of the Treasury, to accept temporary loans from the National Loans Fund to the Redundancy Fund up to £20 million for
1452
a period of two years beginning August 16, 1968. The effect of the Redundancy Fund Increase of Contributions Order 1968 is to increase the weekly Redundancy Fund contribution paid by employers from 10d. to 1s. 3d for a man and from 5d. to 7d. for a woman with effect from September 2, 1968. This Order is made in exercise of the powers given to the Secretary of State for Employment and Productivity under Section 27(3) of the Redundancy Payments Act.
Both these Orders are made necessary because of the financial state of the Redundancy Fund. Your Lordships will recall the history of this Fund. After a short initial period during which receipts and expenditure were in balance, expenditure began to outstrip receipts, and in February, 1967, contributions were increased from 5d. for men and 2d. for women to the present level of 10d. for men and 5d. for women. The Minister of Labour, in introducing the Order which gave effect to these changes, mentioned that he had originally intended to increase the rates to 1s. for men and 6d. for women, but had accepted the advice of the C.B.I. and the T.U.C. that such increases would have been too drastic. Further rises in expenditure, however, made it necessary in July, 1967, to obtain Parliamentary approval for an increase in the borrowing power limit from £8 million to £12 million.
During the autumn of 1967 the adverse trend in outgoings continued, and further consultations took place with the C.B.I., the T.U.C. and other organisations. Following these consultations the Chancellor of the Exchequer announced in his Budget speech that the Redundancy Fund contribution would be raised from 10d. to 1s. per week for men and from 5d. to 6d. per week for women with effect from September 2, 1968. Meanwhile, in order to safeguard the solvency of the Fund until these higher rates came into operation, Parliament approved in April. 1968, an increase in the borrowing limit from £12 million to £15 million.
In the past three months the numbers of payments have slightly decreased, from 63,550 in the March quarter to 62,755 in the June quarter, but outgoings have continued to rise. This is because the average amount of individual payments

1453
of rebate has sharply increased. The average payment in the financial year ended March, 1968, was £155; but the average for the March, 1968, quarter was £164 and in the June quarter it had risen to £173. This factor had a marked effect on weekly outgoings. In the nine months up to April this year weekly expenditure averaged about £800,000. In the following three months, however, average weekly expenditure rose to over £900,000.
The increase of contributions to 1s. and 6d. in September, proposed in the Budget speech, would have produced an income of £835,000 a week. This would have covered an expenditure of £800,000 a week, and a start would have have been made to reduce the deficit. But it is clearly inadequate to deal with outgoings of £900,000 a week, and a higher increase has therefore become inevitable. At the same time the accelerated drain on the Fund has brought the accumulated Fund debt to about £14 million—very near the present borrowing limit of £15 million. It is therefore only prudent to increase the borrowing powers to a level which will ensure the Fund's solvency.
The increases in contributions to 1s. 3d. for men and 7d. for women, which now replace those of 1s. for men and 6d. for women proposed by the Chancellor of the Exchequer, will produce an income of rather more than El million a week. If present expenditure remains steady at about £900,000 a week, the deficit will be wiped out in about three years. This is not meant to be a prediction, because outgoings are so vulnerable to fluctuations in the component factors making up each redundancy payment. For instance, while increases in wages would tend to increase expenditure, a shift in the age group of redundant workers towards the younger employees would act in the opposite way. It is at any rate the hope that the deficit will have fallen at the end of two years to below £8 million. This is the original borrowing limit written into the Act, and the present borrowing Order is for this reason designed to expire at the end of two years.
My Lords, the Government are not complacent about the working of the Redundancy Payments Act. Outgoings have been heavier than expected, and inevitably a new scheme of this sort has thrown up anomalies. The Department
1454
of Employment and Productivity are now examining the scheme with a view to seeing what improvements can be made. But, in asking your Lordships to approve these Orders to-day, I should like to say that the Government are convinced that the Redundancy Payments Act is serving a vital purpose in making economic and technological change, with the labour mobility that that implies, more acceptable to the working people of this country. I beg to move.
Moved, That the Draft Redundancy Fund Increase of Contributions Order 1968, laid before the House on July 16 be approved.—(Baroness Phillips.)
1.57 p.m.
LORD NUGENT OF GUILDFORD:My Lords, may I thank the noble Baroness, Lady Phillips, for explaining to us the purpose of this Order, and start by saying that I shall give my support to it. I am afraid, however, that I must say some critical things about the history of this matter (which she put before us so lucidly and charmingly that it seemed really quite innocuous) because it rally is a very unhappy story. If I may just highlight the worst spots of it, which naturally the noble Baroness did not, this Redundancy Payments Scheme, which started in December, 1965, then estimated that its revenue per week would be £350,000, and with loan facilities for £8 million from the Exchequer the Minister expected that this provision would last for a "substantial period". Those are his words.
But, as the noble Baroness has told us, within twelve months he was back. again to the House raising the contributions—doubling them, in fact—and telling the House that he expected that the expenditure would go up to double what it was, to about £600,000 per week. He then came back again in July, 1967, with the outgoings, estimated at £600,000 per week, going up another £100,000, and asked for an increase of the borrowing powers from £8 million to £12 million, saying at the time that that £12 million would never be reached. I think it is just worth repeating the Minister's words of last year. He evidently was uneasy about the course of events, for he said this:
"I emphasise to the House that it is our intention to examine the nature of the Fund, the nature of the contributions, and to report to the House where the contribution level

1455
stands and what are the best long term interests of the Fund and how its solvency can and should be preserved ".—[OFFICIAL REPORT, Commons, 24/7/67; col. 276.]
That was a year ago. Now, as the noble Baroness has told us, this Order will again put up the contributions, this time from 10d. to 1s. 3d. for men, and from 5d. to 7d. for women. This means that the contributions have now gone up three times—300 per cent., in three years; and the borrowing limit has gone up by 250 per cent., from £8 million to £20 million. I do not think any comment of mine is needed to demonstrate that the forecasts of the Minister of Labour (or, as the Minister is now called, the Secretary of State for Employment and Productivity) have been completely meaningless, and it would be fair to say that the Minister now can have no idea what is happening in this Redundancy Fund, or what it may cost in the future. I think it is fair for me to comment that the present Government's determination to have an ever-larger say in the management of industry and commerce is all the more surprising, in view of their extraordinary record of incompetence, as here, in running our national affairs.
My Lords, I have studied very carefully the Junior Minister's speech in another place, and from this I gather that two of the major imponderables which make his forecasting look so ridiculous are, first of all, the level of unemployment, and, secondly, the age, length of service and earnings level of those becoming redundant. Indeed, the noble Baroness referred to some of these factors in her speech. I should like to make a comment on these two factors.
The unemployment level is now standing at the exceptionally high seasonally adjusted figure of 581,000, which is 2·5 per cent. It is true that this is about 1 per cent. higher than the Prime Minister predicted last November; and no doubt the unexpectedly large increase has had an important influence on the deficit in the Fund. On the other hand, the trend for long-term unemployment unfortunately seems to be increasing and now the figure for those unemployed over two months is something like 68 per cent. But presumably that is operating in the reverse direction with regard to the expenditure in the Fund. Am I right in thinking that the net effect of this very high level
1456
of unemployment has clearly upset the forecast? What noble Lords would like to know now is the Government forecast for next winter's unemployment level and how it is expected that this will affect the solvency of this Fund.
On the second point, the noble Baroness gave us some figures; but the Parliamentary Secretary in another place gave us no figures at all. But the noble Baroness gave us no precise analysis of the age, length of service and earnings level of claimants on the Fund; so we can only deduce what is happening from the bits of information which the noble Baroness has given us and which the Parliamentary Secretary gave in another place.
The Parliamentary Secretary in another place told the House that it was common practice when staff reductions had to be made in a firm for the employer and employees to put their heads together to make the maximum possible use of the Fund by inviting employees to volunteer for redundancy, with the incentive that those entitled to large sums would obviously do so. The Parliamentary Secretary commended this practice as being in the interests of industrial harmony. I do not know what value this practice would have for industrial harmony even in the short run; but bearing in mind that entitlement to a substantial claim for redundancy is once and for all, I should doubt whether in the long run it would be helpful. Certainly, the Minister's approval of this practice—which in my view is "a fiddle" and nothing less—goes a long way to explain why this high expenditure has so far exceeded the forecast. Indeed, the figures which the noble Baroness gave us to-day, that the average sum paid out on redundancy is increasing every quarter, makes it plain that the Minister's approval of this "fiddle" has undoubtedly become widely known, with the inevitable result that the claims coming in are above the average predicted.
If this kind of "fiddle" is approved by the Minister, it is not surprising to hear that other and more blatant arrangements are practised also. I read in The Times of March 23, of this particular incident, which I am sure is now well known:
"Technicians have all been guaranteed jobs with the new London Week-end Thames Television, the Welsh Harlech, and the Yorkshire Television Groups, but as well as continuity

1457
of employment and full pension rights, they have also received payments believed to total up to £250,000."
This is a shocking state of affairs. I say this with all sincerity. I hope that the noble Baroness will take this back to the Minister in another place: if the Minister lowers the standards of administration, it is not surprising if others follow him down the scale.
BARONESS PHILLIPS: My Lords, could the noble Lord give me the source of the quotation he attributed to the Parliamentary Under-Secretary in another place?
LORD NUGENT OF GUILDFORD: My Lords, as I proceed with my speech I will give this information to the noble Baroness. It was referred to in another place; the Parliamentary Secretary approved of it. The point I want to make is that in my judgment it is high time that the Minister published a report of the review of this fund which was promised. If that is not to be done, I hope that the Commons watchdogs of the public purse, the Public Accounts Committee, will cast their expert eyes on what I regard as this highly unsatisfactory administrative affair.
I just throw this into the picture—I think it is relevant. The Minister of Social Security has now taken action to check what is, I think. officially called "voluntary unemployment" by those more generally called the "workshy". This indicates that the scale of this abuse of public funds by people who are receiving unemployment pay plus supplementary benefits and who are unwilling to take on jobs which are offered to them has reached serious dimensions. There are, unfortunately, many people who will abuse public funds, and, indeed, the Redundancy Fund, where the opportunity is offered. I think the Government have a duty to investigate, report and check what abuses there are in this field. I think they could be stopped.
My Lords, as I said at the start, the intention of the Scheme commands general approval. It is to soften the blow of redundancy—and we all wish to do that—and to ease the transition to a new job. But the existing Scheme in its present form bears all the signs of being no more than a rough-and-ready affair. In terms of making the best use of
1458
national manpower by helping the transition to a new job, it is not by any means clear that it is succeeding. The rising trend of unfilled vacancies in companies in the South-East and the rising unemployment levels in the North and Scotland, I think, tend to bear this out.
Now that the total expenditure of the Fund is running at a level of £900,000 a week, or £45 million a year, very large sums of money are involved. It is, in fact, quite a significant extra cost for industry to carry. I suggest that the rough-and-ready methods of the past are just not adequate and that in the light of almost three years' working experience a much more precise Scheme should now be worked out. I would suggest that some thought should be given to using at any rate some of the money for fitting a redundant worker for his new job, if necessary by re-training, rather than for paying him an unconditional lump sum. At the end of the day, this is going to be very much in his own interests as well as in the country's
I should like to make this suggestion, as an alternative approach that might be considered by the Ministry when this existing review is going on. Instead of the existing lump sum payment when a worker becomes redundant, there should be, to start with, a special high late of unemployment pay, which should continue until such time as he is offered suitable alternative job or is given a training course to fit him for another job where vacancies exist. Thai high rate should continue until the training is finished. If he refuses a suitable job or refuses the training scheme, his unemployment pay should be reduced to the basic level. I commend this as a constructive thought which I believe would make a better use of these very large sums of money now being paid out. Incidentally, I think this suggestion would embrace the need to expand the industrial training scheme which is running at too low a level to carry the large number which would be brought into it if my idea became practicable. In answer to the question of the noble Baroness, I have been able to look at the Hansard record of another place, to see where this particular reference came from, and my impression is that it came from col. 401, in the reply of the Parliamentary Secretary to the debate on 23rd July.

1459
I conclude my comments, my Lords, by saying that if the Government wish to repair the damage to their reputation from the administration of this Fund—and I am sure they do—they have an urgent obligation to complete the promised review and make a full report of their plan—which I hope will mean a completely revised scheme—to Parliament, and to do that as quickly as possible. My Lords, I am sorry to have to say so many critical things, especially to the noble Baroness, Lady Phillips, but I feel that the record deserves it, and I hope that, as the general idea has my warm support, the noble Baroness will take back those thoughts to her right honourable friend in another place, and perhaps they will be of help in the review that is going on.
2.11 p.m.
BARONESS PHILLIPS: My Lords, I should like first to thank the noble Lord, Lord Nugent of Guildford, for his constructive suggestions. Inevitably, the idea of any payment in a situation of redundancy or unemployment must be linked with the desire to enable the man or woman to seek employment as early as possible. I will certainly convey to my right honourable friend the ideas that the noble Lord has put forward. As he was courteous enough to let me know that he was going to raise the point I did check about the review, and I find that in fact the Minister did not promise to give an account of a review. However, the whole Act and the working of the Act is under very close review all the time.
I think it worth while to point out to the noble Lord (I am sure he will agree with this) that the fact that the increases have been several, rather than one larger one, represents an attempt on the part of the Government not to place a greater financial burden on industry than is absolutely essential. This procedure has necessitated the Minister's returning to ask for several increases in the contribution. I think that also we must bear in mind (I am sure that your Lordships will be fair over this) that this is a scheme where there are no comparable precedents, and of necessity it will have to be kept under constant review. It is now moving into a stage where it will be a little easier to give more firm forecasting figures. It is a matter of regret
1460
on the part of the Government that it should be necessary to place an increased burden on industry at a time when higher productivity is being called for.
In a sense, the Scheme has been proved successful by the very fact that there have been these calls upon it. In relation to the figures concerning television employees, it has since been appreciated that these figures were greatly exaggerated; and the Government is satisfied that in most cases the redundancy proposals were justified. I still have not quite taken the noble Lord's point that the Under-Secretary was supporting what the noble Lord called "fiddles". I think that the Under-Secretary was trying to point out that in several of the cases mentioned redundancy payments were justified.
LORD NUGENT OF GUILDFORD: My Lords, may I interrupt the noble Lady? I should he very pleased to read the statement, though it is not normal to do so. It shocked me so much to read it that I felt it was only right to comment on it to-day. It is stated in col. 401:
"The second sort of abuse—and I emphasise that it is abuse, in my view, only in the minds of the people who claim it to be so—concerns an employer who knows that a percentage of his work force is likely to be made redundant and offers his work force the opportunity to opt for redundancy if a portion of it chooses to do so. For example, the company with, say, 500 employees which says that 50 must be paid off on the first of next month and is prepared to take 50 volunteers. Clearly, the 50 volunteers are likely to be men who say, 'regretful as I am …'"
and so on. Then the Under-Secretary goes on:
…and the more substantial the sum, the more likely they are to volunteer for redundancy. This does not seem to me to be an abuse of the scheme. Indeed, it seems to be a way in which redundancy can be carried out without friction, with the minimum of hardship and with a positive contribution to industrial relations rather than industrial relations of the firm deteriorating."
My Lords, there may be some slight point in that, as I commented, but the general principle of this simply horrifies me. It really is a complete connivance in order to extract the maximum amount from the Scheme, and to a very large extent that is why the sums keep on going up and up.
BARONESS PHILLIPS: My Lords, I should not like at this point to indulge

1461
in a debate on this question. It seems to me that it is a question of the interpretation the Under-Secretary was placing upon this particular situation, and it is, I think, related to the question of age. As a 50-year-old I rather resent the statement that a 50-year-old cannot be retrained, which seemed to me to run through some of the debate in the other place. As the prime of life must rise with the increased length of life, it seems that this is a matter which might well merit some discussion. I hope that the noble Lord will accept that I have tried to cover the points he raised. I will certainly convey his suggestion of an alternative approach, and we shall undoubtedly have an opportunity of reviewing this Act. Inevitably, in an Act of this kind there must be a great deal of flexibility in operation.
On Question, Motion agreed to.

REDUNDANCY FUND (ADVANCES OUT OF THE NATIONAL LOANS FUND) (No. 2) ORDER 1968
BARONESS PHILLIPS: My Lords, I beg to move.
Moved, That the Draft Redundancy Fund (Advances out of the National Loans Fund) (No. 2) Order 1968, laid before the House on 16th July, be approved.—(Baroness Phillips.)
On Question, Motion agreed to.

ROYAL ASSENT
THE LORD CHANCELLOR (LORD GARDINER): My Lords, I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified Her Royal Assent to the following Acts:

Appropriation Act,

Finance Act,

British Standard Time Act,

Health Services and Public Health Act,

Sewerage (Scotland) Act,

International Organisations Act,

Social Work (Scotland) Act,

Hearing Aid Council Act,

Highlands and Island (Development) (Scotland) Act,

1462

Caravan Sites Act,

Adoption Act,

Theatres Act,

Friendly and Industrial and Provident Societies Act,

Swaziland Independence Act,

Overseas Aid Act,

International Monetary Fund Act,

Hovercraft Act,

Theft Act,

Ministry of Housing and Local Government Provisional Orders Confirmation (Blackpool and Stourbridge) Act,

Ministry of Housing and Local Government Provisional Order Confirmation (West Kent Main Sewerage District) Act,

Crosby Corporation Act,

Greater London Council (Vauxhall Cross Improvement) Act,

Ely Ouse-Essex Water Act,

Great Northern London Cemetery Company Act,

Hounslow Corporation Act,

Lancashire County Council (General Powers) Act,

Mersey Docks and Harbour Board Act,

Mid-Glamorgan Water Act,

Port of London Act.

Medway Water (Bewl Bridge Reservoir) Act,

British Railways Act,

British Railways (Mersey Railway Extensions) Act,

Cheshire County Council Act,

City of London (Various Powers) Act,

Durham County Council Act,

Greater London Council (General Powers) Act,

Leicester Corporation Act,

Greater London Council (Money) Act.

PUBLICATION OF PROCEEDINGS IN PARLIAMENT
Message from the Commons, that they concur in the Resolution communicated to them on Wednesday last relative to the Publication of Proceedings in Parliament.
House adjourned at twenty minutes past two o'clock.