Sitting of 26 November 1969

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

    World Trade
    Mr. J. H. Osbornasked the President of the Board of Trade if he will give his estimate of the value of world trade in 1969 compared with each of the previous three years; what has been the value, with export and import, and percentage of Great Britain's share in it; and what estimates have been made in respect of 1970 based on these trends.
    The President of the Board of Trade (Mr. Roy Mason): With permission, I will circulate the latest available figures in the OFFICIAL REPORT.
    I do not wish to venture precise forecasts of the out-turn for this year as a whole or for 1970. However, after its recent exceptionally rapid expansion, I expect that world trade may soon grow somewhat less strongly, and that this could have some effect on the growth of our exports. Imports are likely to show some increase as the economy expands.
    Mr. Osborn: Can the President of the Board of Trade give some estimate of the

    January—June (a)

    1966

    1967

    1968

    1968

    1969(b)

    TOTAL EXPORTS (f.o.b.)

    U.S.$thousand million

    World (c)

    …

    181·4

    190·5

    212·9

    101·8

    116·3

    United Kingdom

    …

    14·7

    14·4

    15·3

    7·5

    8·4

    — per cent share

    …

    8·1

    7·5

    7·2

    7·4

    7·2

    EXPORTS OF MANUFACTURES (d) (f.o.b.)

    Main manufacturing countries (e)

    …

    92·6

    99·1

    114·2

    54·3

    64·0

    United Kingdom

    …

    12·0

    11·8

    12·7

    6·2

    7·0

    — per cent share

    …

    12·9

    11·9

    11·1

    11·5

    11·0

    TOTAL IMPORTS (c.i.f.)

    World (c)

    …

    192·1

    201·8

    224·5

    108·3

    122·7

    United Kingdom

    …

    16·7

    17·7

    19·0

    9·4

    10·0

    — per cent share

    …

    8·7

    8·8

    8·4

    8·7

    8·2

    (a) Not seasonally adjusted.
    (b) Preliminary estimates.
    (c) Excluding the Sino-Soviet countries.
    (d) Section 5 to 8 of the Standard International Trade Classification.
    (e) U.K., U.S.A. Canada, Japan, E.E.C. countries, Sweden, Switzerland.
    extent to which a slowing down in the growth of world trade would affect our exports, and the extent to which our increased exports have been due to devaluation?
    Mr. Mason: It is too soon to give an estimate regarding devaluation. One could give only a rough guess as to how world trade might move in the next year or so, but what is pleasing is that during the course of expansion in world trade we have this time managed to maintain our share whereas previously when world trade grew we actually fell back.
    Mr. Cant: I appreciate that my right hon. Friend is too much of a gentleman to remind the Opposition that Britain's share of world trade fell from 25 to 17 per cent. from 1951 to 1964, but will he accept that this is no longer a proper yardstick and that exports per 1,000 of the population give a more accurate guide?
    Mr. Mason: That is a better indicator, but the Question refers to the first point which my hon. Friend mentioned.
    Mr. Higgins: The right hon. Gentleman has made the extraordinary statement that it is too soon after devaluation to make an estimate of what effect it has had. We ought to have a reasonable estimate by this stage of what the elasticities were in response to the change in relative prices of exports and imports, ought we not?
    Mr. Mason: I still think that it is too soon to say, after about two years, or to give an accurate forecast of the real effects.
    Following is the information:

    Overseas Marketing Corporation
    Mr. Bruce-Gardyneasked the President of the Board of Trade if he will give the number and aggregate value of contracts between United Kingdom manufacturers and foreign buyers which the Overseas Marketing Corporation has been instrumental in promoting and the average size of the United Kingdom firm concerned.
    Mr. Mason: The Overseas Marketing Corporation is established as a private limited company, and it would, therefore, not be right to disclose details concerning the commercial activities of the corporation.
    Mr. Bruce-Gardyne: Come now—this body has already taken upwards of £200,000 of preferentially valued loan capital from the taxpayer. Is not the taxpayer entitled to know what is being done with the money, and the extent to which he is getting value for the money expended on his behalf?
    Mr. Mason: As I have said, it is a private limited company. If the hon. Gentleman wanted more information, I would advise him to go to the company. It is true that it has drawn £275,000, and so far it has had a measure of success in Europe.
    Mr. Ridley: Can the right hon. Gentleman tell us what return we are likely to see on the £275,000 which has been drawn? This is what is of interest to the taxpayers who put up the money.
    Mr. Mason: That is not quantifiable just yet. The O.M.C. is an experimental initiative, and it has spent some time helping manufacturers who lacked marketing resources and expertise in identifying opportunities for them abroad and finding them markets.

    Coach Passengers (Insurance)
    Mr. Gwilym Robertsasked the President of the Board of Trade what study he has made of the evidence supplied to him by the hon. Member for Bedfordshire, South showing that passengers in coaches were frequently not fully covered by insurance unless the liability of the coach company could be fully proved; and if he will take steps to close
    394
    this type of insurance loophole in this and other forms of transport.
    The Parliamentary Secretary to the Board of Trade (Mrs. Gwyneth Dunwoody): The liabilities of coach operators for damage to the luggage of their passengers are usually governed by the conditions of carriage. It is for the operators to decide whether to insure against these liabilities. In general, the conditions of carriage, not the degree of insurance, limit the extent to which claims by passengers are entertained.
    The Law Commission is at present considering, in relation to contracts for services generally, how far it should be permissible to contract out of common law liabilities.
    I shall write shortly to my hon. Friend on the matter.
    Mr. Roberts: I earnestly urge my hon. Friend to expedite the matter as much as possible. Does she realise that 99 per cent. of the general public who go abroad in a coach believe that their luggage is covered by the company in case of accident? Can she tell us what the position is in British Railways and bus companies?
    Mrs. Dunwoody: It may well be that passengers are not fully cognisant of the terms under which their luggage is carried. In general, I think that a lot of people choose to insure their luggage individually. Questions about British Rail are for my right hon. Friend the Minister of Transport.

    Gross National Product and Imports
    Mr. Michael Shawasked the President of the Board of Trade what estimate he has made of the relationship between the size of the gross national product and the level of imports; how this compares with the relationship in other equivalent countries; and what evidence he has that this relationship is changing.
    Mr. Mason: At current prices, our imports from 1958 to 1968 have varied between 14 and 16 per cent. of the gross national product. There is no discernible trend in the proportion, which is similar to that for the European Economic Community. In volume terms the proportion has risen, but more slowly than in all

    395
    other comparable countries. With permission, I will publish figures in the OFFICIAL REPORT.
    Mr. Shaw: I thank the right hon. Gentleman for the figures I am to receive. Is it the fear of a sudden rise in the ratio of imports that continues to prevent

    TABLE A

    IMPORTS AND G.N.P. AT CURRENT PRICES

    Ratio of imports to G.N.P. at current market prices (per cent.)

    Year

    United Kingdom

    Other EFTA countries

    EEC countries

    Canada

    United States

    Japan

    1958

    …

    …

    14·6

    22·6

    14·9

    15·4

    3·0

    7·9

    1959

    …

    …

    15·0

    22·8

    14·6

    16·0

    3·3

    8·6

    1960

    …

    …

    16·0

    24·6

    14·9

    15·3

    3·0

    8·7

    1961

    …

    …

    14·7

    24·6

    14·5

    15·3

    2·9

    9·1

    1962

    …

    …

    14·2

    24·0

    14·4

    15·3

    3·0

    7·7

    1963

    …

    …

    14·2

    23·6

    15·0

    15·2

    3·0

    8·5

    1964

    …

    …

    14·9

    24·5

    15·0

    15·9

    3·1

    8·2

    1965

    …

    …

    14·1

    24·4

    15·2

    16·5

    3·3

    7·6

    1966

    …

    …

    13·8

    23·9

    15·5

    17·4

    3·5

    7·6

    1967

    …

    …

    14·1

    23·5

    15·0

    17·6

    3·5

    7·8

    1968*

    …

    …

    16·1

    23·2

    15·6

    18·4

    4·0

    7·3

    1969 H.1

    …

    …

    16·0*

    * Provisional estimates.

    TABLE B

    INCREASE IN IMPORTS AND G.N.P. AT CONSTANT PRICES, 1958 TO 1968

    (Volume Index Numbers 1958 = 100)

    United Kingdom

    Other EFTA countries

    EEC countries

    Canada

    United States

    Japan

    Imports (1958=100)

    174

    220 to 272

    257 to 328

    209

    237

    433

    G.N.P. (1958=100)

    137

    151 to 179

    154 to 173

    159

    158

    285

    Ratio Imports/G.N.P.

    1·27

    1·36 to 1·80

    1·56 to 1·91

    1·32

    1·51

    1·52

    British European Airways (Aircraft Requirements)
    Mr. Onslowasked the President of the Board of Trade what recent discussions he has had with the Chairman of British European Airways on the airline's future requirements for aircraft.
    Mr. Mason: None, Sir, yet.
    Mr. Onslow: Will the right hon. Gentleman confirm from his most recent discussions with the British European Airways Board that it still wishes to see B.E.A. operating aircraft of British manufacture, that it wishes to buy new aircraft in that category, and that it has his support in this?
    Mr. Mason: I am awaiting its proposals. I cannot go any further than
    the Government from pursuing a policy of expansion?
    Mr. Mason: Not at all. There has been only a moderate increase in imports during the course of the year.
    Following is the information:
    that at present, but I shall certainly have a sympathetic ear when they come.
    Mr. Maclennan: Will my right hon. Friend have discussions with B.E.A. about what aircraft is to take the place of the Viscount, particularly in its use in the Highlands and Islands of Scotland?
    Mr. Mason: I have not been approached on that matter so far, and I have not made any arrangements for meeting B.E.A. on the subject.

    Aircraft Noise (International Certification Standards)
    Mr. Onslowasked the President of the Board of Trade what progress he has made in his discussions with the United

    397
    States and French authorities on international noise certification standards for aircraft; and if he will make a statement.
    Mr. Corfieldasked the President of the Board of Trade if he will indicate the results of his discussions with representatives of the Government of the United States of America in regard to maximum permitted noise levels of both subsonic and supersonic aircraft, both in flight and at landing and take-off, operating between the United Kingdom and the United States of America.
    Mr. Barnesasked the President of the Board of Trade if he will make a statement on the progress of the proposals for an international aircraft noise certification scheme, which Great Britain, France and the United States of America are submitting to the International Civil Aviation Organisation.
    Mr. Mason: The progress of tripartite work on noise certification standards for the next generation of subsonic jet transport aircraft has been reported to the International Civil Aviation Organisation. This work will be discussed at an I.C.A.O. Special Meeting on Aircraft Noise next month. We shall press for early agreement on a practicable international scheme to secure the progressive introduction of the much quieter aircraft which are now technically possible.
    It is still too early to make proposals for noise standards for new types of supersonic aircraft.
    Mr. Onslow: Does the right hon. Gentleman agree that the House would welcome the opportunity to debate the matter fully? When he is ready to introduce proposals, we shall want to be satisfied with the adequacy of all his arrangements to control and diminish aircraft noise, and shall want a full day for that.
    Mr. Mason: That is a question for my right hon. Friend the Leader of the House. I shall take a keen personal interest in the matter, as I have since I opened the first international noise conference at Lancaster House in 1966.
    Mr. Corfield: Whilst I support my hon. Friend's demand for adequate discussion, will the right hon. Gentleman bear in mind that some of the technical modifications proposed could inflict propor-
    398
    tionately much greater expense on our aircraft industry than that of the Americans and other countries?
    Mr. Mason: Yes, Sir. That is something we shall have to keep in the forefront of our minds. Three major nations are involved, and we shall have to see to what extent the cost affects individual States.
    Mr. Barnes: Many people living near London Airport have been greatly encouraged by the high hopes my right hon. Friend has expressed about noise certification in his booklet "Action Against Aircraft Noise." Will he be more specific and say by what year he expects, say, 50 per cent. of aircraft using London Airport to be noise-certified?
    Mr. Mason: I am sorry that I cannot be more specific than I have already been. We shall have to await the international discussion at I.C.A.O.
    Mr. Rankin: Does my right hon. Friend agree that we produce one of the quietest engines that has ever taken to the air, the RB 211, and that it is the type of engine we would be better using ourselves, even though we earn a lot of money by selling it to America?
    Mr. Mason: The RB211 does not power present-day aircraft. Aircraft which should be covered and therefore should be quieter would be the Lockheed 10–11, the BAC3–11, the DC10 and the European Airbus.

    Board of Trade Journal
    Mr. Sheldonasked the President of the Board of Trade what changes he proposes to make in the Board of Trade Journal.
    Mrs. Gwyneth Dunwoody: To improve the Journal's usefulness to its readers, changes of content and editorial technique are under discussion. These follow a readership survey conducted last year. The Journal will continue to emphasise matters concerning exports and provide a vehicle for a broad range of official information affecting trade and industry.
    Mr. Sheldon: Since so many of the activities of the Board of Trade have been hived off to other Departments, is

    399
    it not clear that there is a need for another publication which will reflect the wide-ranging relationship between Government and industry, and that this might be brought about by an expansion of the Board of Trade Journal or even by another journal?
    Mrs. Dunwoody: The Board of Trade remains a very important Department in Whitehall, covering a great many vital subjects. Although the Board of Trade Journal has not yet reached the point where it interprets statistics as being someone's bust measurement, I think it will contain some rather useful bits of information.
    Mr. Wingfield Digby: As a keen reader of this publication, might I ask that the trade statistics be brought a little nearer the beginning, instead of being tucked away near the end?
    Mrs. Dunwoody: The hon. Gentleman is one of an estimated readership of 33,600 people, all of whom, very interestingly, appear to be in influential positions. We shall certainly take note of his point of view.

    Apples
    Sir G. Nabarroasked the President of the Board or Trade what value of apples have been imported into Great Britain during the 12 months ended 31st October or the latest convenient date: and what contribution to the policy of imports substitution has been made by British apple growers in the period stated.
    Mrs. Gwyneth Dunwoody: Information on imports of apples for the twelve months ending 30th September, 1969, may be derived from the issues of the Overseas Trade Accounts for December, 1968 and September, 1969 (page 19). October figures are not yet available. As imports of apples which compete with the domestic crop have for many years been subject to quota restrictions, any increase in consumer demand during the home marketing season is met by domestic supplies.
    Sir G. Nabarro: Is it not the fact that the Board of Trade controls all imports of apples into the United Kingdom from foreign as well as Commonwealth sources, and that this year larger supplies have been brought in than ever before, at a time when our own crops are the biggest in history? Is the hon. Lady aware that
    400
    thousands of tons of apples now lie unsold in Britain? Does that not represent a huge wastage of our national resources?
    Mrs. Dunwoody: I am sure that the hon. Gentleman will agree with me that British apples are among the best in the world. We must consider the consumer in this matter. My hon. Friend the Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food has pointed out that the home crop is 18 times greater than the quota we import from other countries. I think British apples are the best.
    Mr. William Hamilton: What representations has my hon. Friend had from consumers or consumers' associations for the price of apples to be put up?
    Mrs. Dunwoody: Not surprisingly, none. It is a bit wearing when hon. Gentlemen opposite run campaigns which emphasise how difficult the matter is but do not protect the consumers' interests.

    Balance of Payments (Import Substitution)
    Sir G. Nabarroasked the President of the Board of Trade what contribution to the balance of payments has been made by import substitution; and whether he will make a statement as to achievements of that policy, duly quantified,ad valorem,
    Mrs. Gwyneth Dunwoody: It is not possible to put a figure to the total contribution made by import substitution to the balance of payments.
    Sir G. Nabarro: Why is it that the Board of Trade Ministers keep on boasting about all the wonderful results of their import substitution policies if they cannot bring to the House a modicum of evidence that those policies are succeeding in the matter of either apples or horticultural products of any kind, or in any raw material?
    Mrs. Dunwoody: I am sure that the hon. Gentleman will be delighted with the rapid exploitation of North Sea gas, which is likely to save about £25 million worth of imports this year and £50 million worth next year, to mention just one item.
    Sir G. Nabarro: In view of the highly unsatisfactory nature of that reply, I beg to give notice once again that I will raise these matters on the Adjournment.

    Goods at Sea (Limitation of Liability)
    Mr. Fletcher-Cookeasked the President of the Board of Trade when he proposes to introduce legislation to amend the rules governing limitation of liability for goods at sea.
    The Minister of State, Board of Trade (Mr. Goronwy Roberts): Legislation will be introduced as soon as possible.
    Mr. Fletcher-Cooke: Is it not nearly two years since we took the lead at the Brussels Conference in obtaining that important agreement, and is it not two years too long for the ratification so earnestly looked for?
    Mr. Roberts: I agree that ratification is desirable as soon as possible, especially in view of the lead we took at the discussions. However, it has been necessary to consult a great many interests, and this has taken some time.

    Hallmarking
    Mr. Blakerasked the President of the Board of Trade what proposals he has for altering the law relating to the hallmarking of gold and silver wares; what representations he has received for and against abandoning the system of compulsory hallmarking; and if he will make a statement.
    Mr. Dudley Smithasked the President of the Board of Trade when his inquiry into hallmarking will be completed; and what representations he has received that it should be abandoned.
    Mr. Wigginasked the President of the Board of Trade (1) if he has considered the recommendations of the Consumer Council on the hallmarking of gold and silver; and what conclusion he has reached;
    (2) what plans he has for bringing up to date the assay and hallmarking laws.
    Mrs. Gwyneth Dunwoody: Consultations about the basis on which reform of the hallmarking law should proceed are still in progress. Pending their completion— hope within next few weeks
    402
    —I cannot reach conclusions, but the views so far expressed are unanimously in favour of a compulsory hallmarking system.
    Mr. Blaker: Can the hon. Lady give an assurance that the compulsory hallmarking system will be retained?
    Mrs. Dunwoody: I ask the hon. Gentleman to await the results of the discussions. It would be wrong to commit oneself to a conclusion now. The Stone Committee reported 10 years ago. We have been looking at the need to update this law before we reach any definite conclusions.
    Mr. Dudley Smith: Has this inquiry come about through pressure from other E.F.T.A. members? If we do try to achieve some harmonisation with these countries, it will lead to an inevitable deterioration in the hallmarking standards which are so good in the United Kingdom.
    Mrs. Dunwoody: Any reform of a law we have had since mediaeval times seems hardly a rapid change. All we are doing is to recognise that hallmarking has a part to play in our exports, and we want to see whether it needs modernising in any way.
    Mr. Wiggin: Is the hon. Lady aware that there is a good deal of feeling, both in the Consumer Council and in the Assay Office, that not only should the law be kept as it is but that it should be consolidated and modernised? Will she bear this in mind?
    Mrs. Dunwoody: It is because we feel that the law may need modernising in some ways that we have started these talks. A certain amount of unnatural heat has been generated by what have been careful exploratory talks.
    Mr. Ridley: Is the hon. Lady aware that the unique advantage of hallmarking is that it protects the consumer not only on the first sale but on subsequent changes of hands in the future? In view of what has been said, will she drop this inquiry and leave the system as it is?
    Mrs. Dunwoody: We have had a system of hallmarking for many hundreds of years and perhaps now it is time that some of the laws were tightened up. We

    403
    are looking at the subject again following the Stone Committee's Report suggesting that possibly it is time that there were certain minor modifications. But these can only come after discussion with the people concerned.
    Mr. Julius Silverman: Will my hon. Friend assure us that if minor modifications are made in the law to bring it up to date, it will still contain a compulsory element in hallmarking?
    Mrs. Dunwoody: That is one of the points we are examining. I would not like to commit myself, although I think that that may well be so.

    East Germany (Trade)
    Mrs. Renée Shortasked the President of the Board of Trade what proposals he has to increase British-German Democratic Republic trade from 1970.
    Mr. Mason: The Confederation of British Industry and the East German Chamber of Foreign Trade are at present discussing trade arrangements to cover a period of three years. I am hopeful that the discussions will be successful.
    Mrs. Short: I thank my right hon. Friend for that gleam of light. Will he assure us that the talks now proceeding about a long-term agreement will not fall down over the nonsense about nomenclature of the other contracting party? Will he consider opening a British office either in East Berlin or in Leipzig, where increasing numbers of British businessmen go twice a year to exhibit at the Leipzig Fair?
    Mr. Mason: I hope that nomenclature will not hinder the negotiations. I do not know whether it would be helpful to have an office in East Germany. This year should be a record year for exports to East Germany, topping the previous record, made in 1966, of £15·9 million.
    Mr. Lubbock: Is the right hon. Gentleman aware that the German Democratic Republic has decided as a matter of policy not to create a domestic computer industry, so that the prospects for selling British data processing apparatus there are very bright? Will he draw the attention of the industries concerned to this and accept the hon. Lady's suggestion so that we could have
    404
    an office in East Germany where these matters could be pursued in greater detail?
    Mr. Mason: No doubt data processing and computer equipment will be one of the items discussed between the C.B.I. and the East Germans this week. I hope that we shall get a favourable report by Friday.
    Mrs. Renée Shortasked the President of the Board of Trade why he did not meet the State Secretary for External Economic Affairs of the German Democratic Republic during his recent visit to London.
    Mr. Mason: In view of the policy of the United Kingdom and other N.A.T.O. countries on recognition of East Germany, a meeting would not have been appropriate.
    Mrs. Short: I am not sure what my right hon. Friend means by this being inappropriate. Is he aware that, because of the strictures of the Foreign Office on the trade connections we have with the German Democratic Republic, we are cutting off our trade noses to spite our faces? Last year our exports to East Germany were only £13 million whereas the exports to East Germany of the Federal German Republic were £160 million? Is it not high time we normalised our trade relations with the German Democratic Republic, as many of our N.A.T.O. and Western European partners have already done?
    Mr. Mason: My hon. Friend obviously did not hear the statistics I gave in my previous reply. This year looks like being a record year for our exports to East Germany.
    Mr. Bruce-Gardyne: Should not the right hon. Gentleman point out to the hon. Lady that it is the policy of the Government to cut off their trade noses to spite their faces in all sorts of directions?
    Mr. Mason: In spite of the high principles we have on this side of the House, as distinct from hon. Members opposite, particularly the hon. Member for South Angus (Mr. Bruce-Gardyne), our export trade is not doing badly.
    Mr. George Brown: Is my right hon. Friend aware that, while there is not

    405
    much that my hon. Friend the Member for Wolverhampton, North-East (Mrs. Renée Short) and I agree upon in terms of foreign politics, on this issue the Government are missing the point? When Herr Brandt has decided upon an Ostpolitik, why should we hold behind? Is it not now time for us to open up trade avenues, which means having an office in East Germany? Otherwise other people will pick it all up long before we get there?
    Mr. Mason: Our trade with East Germany is increasing, and this week there is the possibility that we shall be able to establish a three-year trade agreement with East Germany as distinct from the annual reviews we have had in the past.
    Mrs. Short: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of the reply, I beg to give notice that I shall seek to raise this matter on the Adjournment at the earliest opportunity.

    Civil Aviation (Fares)
    Dr. Grayasked the President of the Board of Trade what his present policy is regarding International Air Transport Association fare restrictions.
    Mr. Goronwy Roberts: The Government's policy is outlined in paragraphs 60 to 62 of the White Paper on Civil Aviation Policy.
    Dr. Gray: Is my right hon. Friend aware that package tours on reputable air carriers are sold in Western Germany at prices considerably less than the normal tourist fares? Will he consider the implications for British tourist agents if the £50 allowance is abolished and these can be purchased freely from this country?
    Mr. Roberts: Part of my hon. Friend's supplementary question ranges beyond the responsibilities of my Department, but I take note of what he says about the tourist allowance. If he refers to paragraphs 55 to 59 of the White Paper he will find, with the paragraphs I have referred to, a fairly complete answer to his question.
    Mr. Corfieldasked the President of the Board of Trade if, in view of the
    406
    cessation of international control over scheduled air fares on the Atlantic, he will remove all remaining controls over the fares charged by operators of either whole aircraft or inclusive tour charter services operating on this route.
    Mr. Goronwy Roberts: I hope that scheduled carriers will agree on a realistic tariff. Until then, fares are controlled by the Governments concerned. The Government's policy on inclusive tour prices and affinity group travel is outlined in paragraphs 55–59 of the White Paper on Civil Aviation Policy.
    Mr. Corfield: Is it not quite clear from the White Paper and the Edwards Report that the Government's attitude is that the chartered and inclusive tour fares should be controlled only to the extent that it is necessary to protect the scheduled carriers? As the Question indicates that the scheduled airlines have thrown over their protection, why continue the control?
    Mr. Roberts: I could not agree that the scheduled airlines have thrown over this protection. I would be very surprised to learn that they did not want a continuation of the appropriate protection so long as it is needed. These paragraphs indicate the basis on which we may consider removing that.

    Cotton Textiles (India and Pakistan)
    Dr. Grayasked the President of the Board of Trade if he will make special arrangements to mitigate the damage caused to India and Pakistan by the proposed 15 per cent. tariff against their cotton textile exports to this country.
    Mrs. Gwyneth Dunwoody: My right hon. Friend the former President of the Board of Trade said in his statement on 22nd July that he saw no reason to think that, with the possible exception of India, the developing countries of the Commonwealth generally will be able to export less to Britain over the proposed tariff than under a continuation of the present quota system. So far as India is concerned, in determining the level of aid after 1972 we shall be willing to take into account against the background of her general aid requirements at that time any adverse effects on her exports arising from the tariff.
    Dr. Gray: In view of the damage done to India, why were there no consultations with the Indian Government before the decision was taken? Why has my hon. Friend decided to strike this blow at the Commonwealth in favour of Portugal, which, as a member of E.F.T.A., will benefit?
    Mrs. Dunwoody: The Board of Trade is opening discussions in Delhi this week with the Indian Government. I hope we shall be able to reach an agreement.
    Mr. Fletcher-Cooke: Is the hon. Lady aware that when I sought to put a similar Question on this subject to the Board of Trade, I was told that responsibility had been transferred to the Ministry of Technology? Since she has now accepted responsibility in the case of the hon. Member for Yarmouth (Dr. Gray), may I ask whether it is not the fact that South Korea, much more than Portugal, will be a beneficiary of this change? Will not the Textile Council soon be regretting its decision to remove from the British manufacturer the protection of the quota?
    Mrs. Dunwoody: It is true that there were some alterations in those countries which supply goods to Great Britain, but we have said that we shall take great care to promote the interests of Commonwealth countries in future talks, and I hope that those countries which are able to be efficient in world markets will be able to maintain more than their share of the British market.
    Mr. Blackburn: Will my hon. Friend bear continually in mind the needs of our own domestic textile industry, which has suffered more than any other industry in this country from cheap imports? If India and Pakistan have to be helped, surely the best way in which to help them is by not killing our own industry.
    Mrs. Dunwoody: I do not think there is any intention of doing anything which will kill our own industry. I am sure that, under the reorganisation schemes, the cotton industry will be able to compete in world markets.

    Toy Manufacturers (Advertising)
    Mr. Ashtonasked the President of the Board of Trade whether he will introduce legislation to prevent toy manufac-
    408
    turers from advertising toys between now and Christmas Eve.
    Mrs. Gwyneth Dunwoody: I am not aware of any justification for such a restriction.
    Mr. Ashton: Is my hon. Friend not aware of the extensive advertising on Children's Hour of toys at this time of year and of the embarrassment which it causes to lower-paid workers and widows with families? Does she not think that this form of direct selling to children is unethical?
    Mrs. Dunwoody: I accept my hon. Friend's point that selling methods to children can cause difficulty; there is no doubt of that. However, he may be wrong when he says that advertising is the criminal in this instance, because sometimes it helps people with not quite so much money to pick out what is the best value for money.
    Sir G. Nabarro: Will not the hon. Lady recognise that this Question invites the soubriquet for the hon. Member of "Scrooge"?
    Mrs. Dunwoody: I sometimes think that if hon. Members opposite were as concerned about widows and lower-paid workers as are my hon. Friends, life in this country would be a lot simpler.

    Liverpool Airport
    Mr. Fortescueasked the President of the Board of Trade what reply he has sent to the Liverpool City Council to its recent request for financial assistance for Liverpool Airport.
    Mr. Goronwy Roberts: I am still considering the request for financial assistance made by the delegation which called on me on 27th October and amplified in a letter received earlier this month.
    Mr. Fortescue: Is the Minister aware that the crying need of this airport is for more traffic? Will he undertake to the House that he will put no obstacles in the way of airlines wishing to use this airport? In particular, would he explain to the House why he found himself unable to accept the application of an American airline which wished to fly in and out of Liverpool?
    Mr. Roberts: The hon. Member has mentioned some of the considerations

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    which are present in our minds in considering this application; a few others were added in the letter which we received. I can only assure him that we shall give close attention to all that has been said to us and that we shall send a reply as soon as possible.
    Mr. Ronald Atkins: Will not the Minister agree that it is inconsistent for the Government to subsidise this form of rapidly increasing passenger transport when it is their policy not to subsidise other forms of passenger transport which are declining?
    Mr. Roberts: I do not think that we can engage in a detailed argument about the propriety of certain policies with regard to various airports and various kinds of service, especially not at Question Time, but I take the point.

    Civil Aviation (White Paper)
    Mr. Fortescueasked the President of the Board of Trade when the White Paper on the Report of the Edwards Committee on Civil Aviation will be published.
    Mr. Robert Howarthasked the President of the Board of Trade when he will publish a White Paper on the Edwards Committee Report on civil air transport.
    Mr. Lubbockasked the President of the Board of Trade if he will now make a statement about the Government's proposals for the air transport industry in the light of the Edwards Committee Report.
    Mr. Mason: The White Paper was published on 12th November.
    Mr. Fortescue: In the Edwards Report it was recommended that the objective of civil aviation in this country should be to provide the best service to the customer consistent with safety. Do the Government accept that recommendation or do they, as it appears in the White Paper, water it down?
    Mr. Mason: No, Sir. Safety is always in the forefront of our minds. No doubt the hon. Gentleman is aware that we even had a short debate about air safety on the Adjournment last night.
    Mr. Howarth: Can my right hon. Friend say how he hopes to incorporate
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    the A.R.B. in the proposed civil aviation authority? Will he still be able to make use of the large amounts of voluntary work done on this body by the leaders of industry?
    Mr. Mason: Yes, I hope that that will continue. My hon. Friend should be aware that the A.R.B., the A.T.L.B., B.O.A.C. and B.E.A., people whose contracts were running out during the course of next year, will be receiving an extra 12 months' contract so that we can use all the expertise necessary in the formation of the civil aviation authority, but we hope that those who have given us a great deal of experience and advice in voluntary capacities will continue to do so.
    Mr. Lubbock: Will the right hon. Gentleman reconsider the answer which he gave me last week when he indicated that the civil aviation authority would be responsible for the restructuring of private industry in accordance with the Government's White Paper? Is not this properly the responsibility of the Industrial Reorganisation Corporation, if its services are required? Will the right hon. Gentleman say whether, if the private sector asks for the services of the I.R.C., those services will be accorded to it?
    Mr. Mason: I would have thought that if the civil aviation authority wished to use the services of the I.R.C., it would certainly do so, but at this stage I do not think it is necessary.
    Mr. Corfield: My hon. Friend the Member for Liverpool, Garston (Mr. Fortescue) asked the right hon. Gentleman whether he would confirm that the objective, subject to safety, would be service to the customer. That was the answer required.
    Mr. Mason: It has always been recognised that the national corporations, B.E.A. and B.O.A.C, have always set the highest standards of safety in civil aviation; that will continue.
    Mr. George Brown: I am a little mixed up. As I am supposed to be flying out from Liverpool Airport tomorrow night, will my right hon. Friend say whether Liverpool Airport will be there tomorrow night?
    Mr. Speaker: Order. That was a supplementary question on the last Question.

    Asian Fair, Teheran (Export Orders)
    Mr. David Watkinsasked the President of the Board of Trade what estimate he has made of the increase in export orders resulting from British participation in the Asian Fair held in Teheran in October, 196.
    Mrs. Gwyneth Dunwoody: I cannot at present estimate what exports may result from British participation in this fair last month. Initial reports by British firms taking part make it clear that the fair provided excellent opportunities for them on a growing market.
    Mr. Watkins: Does my hon. Friend subscribe to the view that in practice this turned out to be an Iranian rather than an Asian fair? Is she aware that the British pavilion, which I had the opportunity to visit, was generally rated as the best there?
    Mrs. Dunwoody: I am grateful to my hon. Friend for his second remark. He should not underestimate the number of nations taking part. In this instance it was more than 40. I think that the fair provided many opportunities to British businessmen.
    Mr. R. C. Mitchell: Will my hon. Friend send the congratulations of the House to all those responsible for organising the British stand at this fair? Without doubt, it was by far the best there and was a first-class effort.
    Mrs. Dunwoody: I will gladly do so. The work done by the Fairs Division of the Board of Trade is some of the most efficient of any display services anywhere.
    Mr. Costain: Will the hon. Lady arrange for photographs of the British pavilions at these various fairs to be exhibited so that hon. Members may see them?
    Mrs. Dunwoody: The pavilion had a special roof and some other architectural features of considerable interest. I will certainly try to obtain photographs for the House.

    Invisible Exports
    Mr. Hall-Davisasked the President of the Board of Trade if he will make a statement about his proposals for new ways of encouraging invisible exports.
    Mr. Blakerasked the President of the Board of Trade if he will make a statement about his new proposals for encouraging invisible exports.
    Mr. Ridleyasked the President of the Board of Trade what steps he proposes to take to increase the United Kingdom's invisible trade surplus.
    Mr. Mason: The Government give assistance in a number of ways. I shall be discussing the situation with the Committee on Invisible Exports next month.
    Mr. Hall-Davis: As experience since devaluation has shown that there is a direct relationship between the volume of invisible exports and larger costs to invisible importers overseas, will the right hon. Gentleman discuss in these talks the possibility of reducing invisible export costs by the abolition of S.E.T. paid by those who are invisible exporters?
    Mr. Mason: Of course I recognise that invisible exports have done extremely well in recent times. However, I know that I shall have to trawl old ground and that the S.E.T. argument will come to the fore. I cannot promise that I shall relieve them of it.
    Mr. Blaker: Whatever may be the result of the right hon. Gentleman's forthcoming consideration of this matter, is he not aware that there is already a report, which is now two years old, which makes recommendations for helping the service industries by way of tax, the Queen's Award for Industry and statistics? Could he not get on with some of those recommendations now?
    Mr. Mason: I have already read the report and seen the recommendations. I have no doubt that they will be before us when I meet the Committee on Invisible Exports.
    Mr. Ridley: Will the right hon. Gentleman accept the advice of the Committee on Invisible Exports and separate the contribution which the private sector has made to net invisible earnings from the burdens imposed by the Government's invisible earnings and thereby show the extraordinary extent to which the City has saved the Government's economic bacon?
    Mr. Mason: I would not agree that it is only the City which has saved the country's economic bacon. The hon. Gentleman should be, and no doubt is, aware that there has been much productive enterprise on the shop floor in order to get the visibles off the ground, too. However, I am aware also that the exporters of invisibles feel that there is much mystique in their operations and that they would like to have their image enhanced, and I will look at that, too.
    Mr. Barnett: In view of the rapid growth of invisible earnings since the advent of S.E.T., will not my right hon. Friend study whether it has been positively advantageous in this respect?
    Mr. Mason: It may well have acted as a spur.
    Mr. Maudling: This is a serious point. Is it being argued by the Minister that the result of doing well with invisible exports is to be welcomed by a tax imposed on those who have achieved those invisible exports? S.E.T. is certainly a handicap to invisible exporters. Will not the right hon. Gentleman do something about it?
    Mr. Mason: I cannot promise, but I said that I would have to trawl over old ground and this includes S.E.T. Invisible exporters have done remarkably well in spite of it.

    Export Profitability (Study)
    Mr. Hall-Davisasked the President of the Board of Trade if he proposes to publish the Study of Export Profitability which the Economic Research Intelligence Unit of his Department has undertaken; and when this report may be expected.
    Mrs. Gwyneth Dunwoody: Yes. Preparation of the study for publication is well advanced and I hope that it will appear as a Board of Trade Economic Paper early in 1970.
    Mr. Hall-Davis: While welcoming the Parliamentary Secretary's statement, may I ask her to press on and ensure that there is no delay, because it would be most helpful that these matters should be thoroughly discussed with a view to reaching policy decisions?
    Mrs. Dunwoody: I am sure that the study will be of great assistance. The difficulty was that although it was based on a limited study, the information that we have received in answer to many questions needed to be correlated very carefully before it could be produced. We are certainly pressing on with it now.

    Import Deposits
    Mr. Kenneth Bakerasked the President of the Board of Trade by how much he estimates that imports will increase when the rate of import deposits is reduced from 50 per cent. to 40 percent.
    Mrs. Gwyneth Dunwoody: It is not possible to make a reliable estimate.
    Mr. Baker: If it is not possible to make a reliable estimate, why choose the figure of 40 per cent.? Why not 30 per cent. or 20 per cent.? Is it not a fact that the Government, by extending the import deposits scheme, are acting in ignorance of the effect of the scheme and fear of what might happen if it comes off? Is the hon. Lady aware that ignorance and fear seem to be the two motives?
    Mrs. Dunwoody: Unlike previous Governments this Government never acts from ignorance or fear. The hon. Gentleman who waxes, so eloquent, might like to know that between 1964 and 1968 imports rose on average 13 per cent. whereas in the first three quarters of last year they were only 5½ per cent. higher.
    Mr. Higgins: Have the Government even attempted to make such an estimate?
    Mrs. Dunwoody: What we need is accurate information, and it seems to us to be better to use the indicators I have already given than simply say at the present moment that this is the effect of the import deposits scheme.

    National Exhibition Centre
    Mr. Kenneth Bakerasked the President of the Board of Trade when he expects to reach a conclusion regarding the national exhibition centre.
    Mr. Milneasked the President of the Board of Trade what progress has

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    been made by the committee set up by his Department to examine the possibilities of establishing a national exhibition centre in this country; and if he will make a statement.
    Mr. Speedasked the President of the Board of Trade when his Department will make a final decision on the proposals for a national exhibition centre now under consideration.
    Mr. Mason: I am aware of the urgency of this problem and I will announce my decision at the earliest possible moment. To this end the Steering Committee set up under my noble Friend the Minister of State to consider the national exhibition centre met last week at my request to review urgently the latest proposals.
    Mr. Baker: As this has been going on for ten years, might I press the President of the Board of Trade to reach a rapid decision? In the building of the exhibition centre could we have proper international conference facilities? While this is being considered, could I press upon the right hon. Gentleman the advantages of having the centre at Northolt, which is not only close to my constituency but is on the edge of the greatest airport of the greatest city in Western Europe?
    Mr. Mason: I think it is an urgent matter. It has been hanging fire since 1958, and I intend to deal with it urgently.
    Mr. Milne: Is my right hon. Friend aware that a quick decision on this will benefit not only the South but the North-East and the other development districts? Is he aware that in reply to an Adjournment debate on 12th February his hon. Friend told me that this matter would not just be noted but would be actively considered, and that those concerned would get on with the job?
    Mr. Mason: Yes, Sir.
    Mr. Speed: Is the right hon. Gentleman aware that there are powerful and compelling arguments for siting the centre in the Midlands, subject to certain safeguards? Would he not agree that it is much healthier that we should have a full and factual statement as soon as possible rather than constant leaks in the Press?
    Mr. Mason: Yes. I have one proposal before me, and only one, which is receiv-
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    ing my urgent consideration. The hon. Gentleman is aware of it. I have no equivalent proposal before me to compare with it. This is the proposal for a possible site in Birmingham, and it is the one to which I am now applying my mind.
    Mr. Geoffrey Lloyd: In reaching his decision, will the right hon. Gentleman bear in mind the great and increasing congestion in the London area, and the availability in the Midlands of a site at the heart of a national communications system by road, rail and air?
    Mr. Mason: Yes. The right hon. Gentleman is making a good case for the Birmingham Chamber of Commerce and Birmingham City Council.
    Mr. Julius Silverman: May I press the case of the Birmingham lobby on this? Might I ask the Minister, before he finally comes to a decision, to bear in mind the peculiar and particular advantages of the site already suggested, which has very good rail and air links and is already in the centre of the industrial Midlands?
    Mr. Mason: Communications will be particularly important, and I am certainly taking note of what my hon. Friend has said.
    Sir K. Joseph: Since the right hon. Gentleman has been asked so strongly to consider Birmingham, will he bear in mind the importance of carrying with him in his decision the majority of the national exhibitors, and industry as a whole? Would he also bear in mind the importance of securing proper hotel arrangements for visitors?
    Mr. Mason: The Birmingham proposal, of course, includes the building of a new hotel. As for exhibitors, if this did go to the Midlands it would be likely that their rates would be cheaper because the acquisition of land would be cheaper. The building would consequently go up much quicker than down here. As a result I would have thought that exhibitors would quickly accept that it is a good area in which to exhibit.

    Companies (Rhodesian Interests)
    Mr. Ellisasked the President of the Board of Trade what is his policy with regard to transfer of companies registered

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    in this country to other countries where that company has interests in Rhodesia; and if he will make a statement.
    Mrs. Gwyneth Dunwoody: This is not a matter in which the Board of Trade has any powers under the Companies Acts.
    Mr. Ellis: If my hon. Friend accepts that it is a question of someone seeking to have something done legally so that he could trade with Rhodesia, and thus get round the Act, why does she say that her Department is not responsible? Surely someone must be responsible?
    Mrs. Dunwoody: We have found no evidence showing that there has been a breach of the sanctions legislation. We should, of course, take action if any was discovered.

    Turnhouse Airport, Edinburgh
    Mr. Dalyellasked the President of the Board of Trade what progress is being made in the modernisation of Turnhouse Airport, Edinburgh.
    Mr. Adam Hunterasked the President of the Board of Trade what representations he has had on the need for a new runway and other facilities at Turn-house Airport; and if he will make a statement.
    Mr. William Hamiltonasked the President of the Board of Trade how many representations he has had in the last month concerning the need to extend and improve the facilities at Turnhouse Airport, Edinburgh; and view the need to foster industrial development in the east of Scotland, if he will now treat this matter as one of urgency.
    Mr. Goronwy Roberts: Representations have been received from a variety of sources, including four since mid-October, pressing for major improvements to be made at Turnhouse. I am aware of the importance and increasing urgency of this issue to Edinburgh and to Scotland, and I am sorry that I am not yet in a position to make a statement.
    Mr. Dalyell: Following the recent near miss between a Vanguard and a Hunter, has any directive been given to the military in Scotland not to divert military aircraft to Turnhouse until such time as ground radar has been installed?
    Mr. Roberts: That is another question. I have drafted a letter in reply to my hon. Friend's letter on this point.
    Mr. Hunter: May I press on my right hon. Friend that to extend the existing runway would not solve all the problems at Turnhouse Airport? Will he impress on Edinburgh Corporation and the airlines using the airport that terminal facilities in the city are required for passengers leaving from the city and those coming into the city?
    Mr. Roberts: I am well aware of the concern about facilities. There is another Question on that point which I hope to answer. We welcome the participation of local authorities and I should welcome anything that my hon. Friend and others can do to induce Edinburgh Corporation to review its position.
    Mr. William Hamilton: Does my right hon. Friend recognise that the entire economic development of Eastern Scotland probably depends more on the provision of another runway at Turnhouse than on almost any other single factor? Does he not realise that the air facilities at Turnhouse are probably worse than those in any other comparable city in the British Isles?
    Mr. Roberts: I agree that the aerodrome is of great importance to the economy of East Scotland. Whether this can best be aided by a new runway or by extending the existing runway is a matter of judgment. I assure my hon. Friend that I will bear very much in mind the second point that he made.

    British European Airways (Spare Parts)
    Mr. Dalyellasked the President of the Board of Trade whether he will give a general direction to British European Airways to ensure that spare parts are available at all airports.
    Mr. Goronwy Roberts: No, Sir. This is a matter for B.E.A.
    Mr. Dalyell: Does not my right hon. Friend think that the long-suffering passengers and, indeed, pilots using Edinburgh Airport have enough to contend with, without waiting for spare parts to be brought over from Glasgow? Will he look into the matter?
    Mr. Roberts: Punctuality depends on a number of factors. The number of delays at this airport due to the lack of spare parts was as low as 0·1 per cent. There are thousands of spare parts, B.E.A. tries to provide a good library in each place, but it cannot hope to have every spare part at every place where there is a difficulty.
    Mr. Corfield: Is it not clear from the answer which the Minister gave to another Question that the regularity maintained by the independent airlines has, on the whole, been very superior to that of B.E.A.?
    Mr. Roberts: No. I could not agree with the hon. Gentleman. That is not so.

    European Economic Community (Trade Talks Procedure)
    Mr. Martenasked the President of the Board of Trade if Her Majesty's Government accept Article 113 of the Rome Treaty under which the European Economic Community Commission conducts all trade talks with non-member countries.
    Mr. Mason: As members of the European Economic Community we should be bound by Article 113 of the Treaty of Rome in the same way as other members. The Commission's rôle in trade negotiations is, however, subject to the authority of the Council of Ministers.
    Mr. Marten: Do the Minister and the Government like the effect of this article on our independent action in economic affairs? Do they wholeheartedly agree with it?
    Mr. Mason: After the transitional period the Commission is empowered to negotiate on behalf of the Community, but it would be within the framework of the directive given by the Council of Ministers. Secondly, there are exceptions. During the course of the last year—indeed, recently—the Community approved procedure by which in certain circumstances member States will still be able to negotiate bilateral agreements with non-European Economic Community countries after 1st January, 1970.

    Aircraft Noise (Heathrow Airport)
    Mr. Hugh Jenkinsasked the President of the Board of Trade why he has not taken action to stop continual viola-
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    tions of the minimum noise routeings laid down in the United Kingdom in the Putney-Roehampton area; why his Department take a long period to deal with admitted violations which are drawn to their attention; and what sanctions he now proposes to prevent further violations.
    Mr. Goronwy Roberts: I am not aware of such violations. It is not always possible for air traffic control to direct aircraft along these minimum noise routeings, but deviations are kept to the minimum.
    Mr. Jenkins: Is my right hon. Friend aware that a year ago his hon. Friend who was then in charge of this matter gave me an undertaking concerning the avoidance of the Putney-Roehampton area and that the Board of Trade since then has persistently routed aircraft over this area instead of over the minimum noise routeing area? Will he look into that?
    Mr. Roberts: I will certain look further into the matter. I have already looked into it. I do not know that my information accords quite with what my hon. Friend said. I understand the concern felt in the area about noise and I will certainly look into the matter again.
    Mr. Bessell: Does the right hon. Member agree that while it is vital to keep noise levels to the minimum, at the same time that should not be at the possible expense of safety?
    Mr. Roberts: Yes. That is the dilemma, and the hon. Member has put it very fairly.
    Mr. Hugh Jenkinsasked the President of the Board of Trade if he is aware that most aircraft landing at London Airport, Heathrow, carry about 100 passengers and that as much of the glide path area has a high population density some 18,000 people are subjected to nuisance per lienear mile of overflight; and if he will take appropriate action to prevent this nuisance.
    Mr. Goronwy Roberts: About six to seven million passengers a year land at Heathrow and unfortunately some disturbance to people in the glide path area is inevitable. The existing procedures on approaching to land, and noise insulation grants in the most exposed places, help

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    keep this disturbance to a minimum. Aircraft noise certification will eventually do much to reduce the nuisance.
    Mr. Jenkins: As Heathrow has the only glide path of any major airport in the world which involves flying over heavily populated residential areas, does not my right hon. Friend agree that this affords a reason for pressing on as quickly as possible with the development of the third London Airport, preferably at Foulness?
    Mr. Roberts: As my hon. Friend knows, that is being done. I should like to stress the importance of achieving international agreement on aircraft noise certification. That will certainly help.
    Mr. Russell Kerr: Is my right hon. Friend aware that his view that the noise scourge is being kept to a minimum is not widely held in the Cranford, Heston and Hounslow area, which has been suffering from this affliction and in which the affliction is getting worse every day?
    Mr. Roberts: I take full note of what my hon. Friend says.
    Mr. Fletcher-Cooke: Has the right hon. Member any comment to make on the allegation that the noise recording machinery at Heathrow is deliberately falsified?
    Mr. Roberts: No, except to say that that statement is false.
    Mr. Worsleyasked the President of the Board of Trade whether he will issue instructions to ensure that all aircraft join the glide path at or above 3,000 feet.
    Mr. Goronwy Roberts: No, Sir. To do so would have a number of serious consequences which are unacceptable. Not least, all aircraft approaching Heathrow to land to the West would have to fly over central London, thus substantially widening the area likely to be affected by noise.
    Mr. Worsley: Does the hon. Member agree that one of the consequences of doing this would be to reduce the noise, as high aircraft would make less noise near the ground over central London than low aircraft?
    Mr. Roberts: I am advised that the net result would be to intesify noise at
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    the closest point to the airport and to increase the amount of noise.
    Mr. Lipton: is the Minister aware that some aircraft fly over central London at below 3,000 feet? Will he do something to stop that?
    Mr. Roberts: I shall need to look closely at what my hon. Friend said.
    Mr. Worsleyasked the President of the Board of Trade whether he will give an assurance that when jumbo-jets are introduced next summer they will use the existing three-degree glide path.
    Mr. Goronwy Roberts: The Boeing 747 will follow normal procedures including the use of the three-degree glide path just as any other airliner.
    Mr. Worsley: Is the hon. Member aware that that assurance will be welcomed by those under the glide path? Will he go a little further and give an assurance that these new aircraft will not be noisier than existing types?
    Mr. Roberts: I should not care to add to my original answer. If the hon. Member puts his point a little more specifically in another Question, I will see what I can do.
    Mr. Hugh Jenkins: As these aircraft will be larger than previous aircraft and will, therefore, carry more passengers per aircraft, is there any possibility that when they come into general use the number of flights will be reduced?
    Mr. Roberts: I suppose that is possible. I could not say.

    Weights and Measures Act (Beer)
    Mr. Roebuckasked the President of the Board of Trade how many prosecutions there have been for serving beer in short measures under the Weights and Measures Act, 1963.
    Mrs. Gwyneth Dunwoody: Prosecutions are the responsibility of local weights and measures authorities. Their reports for the year 1967–68—the last for which complete information is available—show that there was one prosecution for serving beer in short measure during the year. It was successful.
    Mr. Roebuck: Does not that Answer show that the law is not being adequately enforced? Is my hon. Friend aware

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    that when beer is in good condition it is almost impossible to get a pint into an ordinary pint pot? Is he further aware that a collar of a quarter of an inch represents an extra 2 per cent. on the brewers' profits and that it is out of that 2 per cent. that the brewers are subsidising the Conservative Party? Will she stop this abuse?
    Mrs. Dunwoody: If the brewers are subsidising the Conservative Party they are not getting much for their money. If my hon. Friend is worried about this matter he might like to use his hon. Friends as inspectors to carry out a series of controlled tests.
    Sir A. V. Harvey: Would it not be more appropriate if the hon. Lady applied herself to the fact that as a result of inflation under this Government beer is shortly to go up in price by 2d. a pint?
    Mrs. Dunwoody: I do not have the strong emotional involvement in beer which some hon. Members appear to have. It seems to me that this legislation is doing a very good job for the consumer in general.

QUESTIONS TO MINISTERS
Mr. Lubbock: On a point of order. 1 notice, Mr. Speaker, that Questions Nos. 60, 61 and 65 today have been taken with earlier Questions on the Order Paper. I seem to recall that at one time you stated it as your policy that Questions put down late and, therefore, appearing as high numbers should not be taken with Questions appearing earlier on the Order Paper, so as not to pre-empt hon. Members' Questions when they happen to have put down, say, Questions Nos. 40 and 41.
It seems to me that the rule has been modified by the Board of Trade. I do not know whether it has been modified by any other Departments. I wonder, Mr. Speaker, although I have no personal interest in the matter this afternoon, whether you could renew the advice you gave earlier to Ministers not to take Questions which appear towards the end of the list with earlier Questions.
Mr. Speaker: The hon. Member has raised an interesting point. He can be sure that the Chair is aware of the
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factor, which he has mentioned several times in the House, that to take late-numbered Questions might pre-empt somebody who has taken the trouble to put down a Question early and prevent him from having the opportunity to ask a supplementary question.
I watch all that. I have to decide whether, say, Question No. 60 happens to be really late. There are occasions when for any Minister more than 60 Questions are put down at the very first opportunity. I am, however, aware of the problem and I watch it all the time. It does not automatically follow that if a Minister ties up Question No. 30 with, say, Question No. 90, I shall invite a supplementary question on the latter.

EXCISE BETTING DUTY (PAYMENT)
Mr. Iain Macleod Mr. Iain Macleod (by Private Notice) asked the Chancellor of the Exchequer whether he will make a statement on the payment of excise betting duties under the Finance Act, 1969, in view of the observations of the Lord Chief Justice.
The Chancellor of the Exchequer (Mr. Roy Jenkins): The Divisional Court yesterday refused an application by two bookmakers for an Order of Mandamus in this matter. In September, following a meeting of the bookmaking and other racing interests with my right hon. Friend the then Financial Secretary, I decided to make a concession allowing the licence duty to be paid in monthly instalments. This was accepted at the meeting as a helpful alleviation.
In view of the remarks of the Lord Chief Justice, I will now consider whether the concession can be maintained, although I must tell the House that there would be considerable administrative difficulty, as well as inconvenience, to say the least, to the great majority of bookmakers, in rescinding it.
I apologise to the House for being in the position, perhaps unusual for a Chancellor, of straining the law in favour of the taxpayer. No one has suffered by reason of what has occurred except to a small extent the Revenue.
Mr. Macleod: Does not the Chancellor agree that the story is a little more complicated than that? The right hon.

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Gentleman has started it as from September. Is he aware that in Committee on the Finance Bill on 11th June, 1969, with support from both sides, I moved an Amendment concerning the precise point of monthly payments and on 16th July, on Report, the then Financial Secretary to the Treasury, rejecting an Amendment by my hon. Friend the Member for Isle of Thanet (Mr. Rees-Davies), said that for technical and administrative reasons it simply could not be done?
My first Question, therefore, is to ask the Chancellor to explain to the House why something which, in the House of Commons in June and July, was said to be technically and administratively impossible becomes feasible after a meeting with the noble Lord, Lord Wigg, and the Horserace Betting Levy Board in September.
Secondly, does not the Chancellor realise that it is a most serious matter when, even with excellent intentions, which in this case I do not in the least dispute. a Minister tries by his own Ministerial edict to overrule both the law and Parliament? Does not the Chancellor realise that in those circumstances it is an error so to do?
Mr. Jenkins: In reply to the first point, we try to do better as time goes on. I must point out to the right hon. Gentleman that although he very reasonably led his right hon. and hon. Friends in voting against us many times in Committee and on Report, they did not do so on this issue.
In reply to the second point, I accept what the right hon. Gentleman has said, and what has been said, and that I must curb my good intentions in future. Generosity can be dangerous.
Mr. Macleod: May I press the right hon. Gentleman on one matter which he has not answered? We did not vote on this matter because of the assurance given by the then Financial Secretary to the Treasury that the proposal was technically and administratively impossible. That was what Parliament was told, and on that basis Parliament made up its collective mind. The point which has now arisen is that the Chancellor, by his own edict, is attempting to get round the law.
Mr. Jenkins: I was only attempting, as the right hon. Gentleman will be aware
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and, indeed, recognises, "to get round the law" to alleviate genuine difficulty.
Mr. Cant: Without holding any brief for bookmakers, may I ask my right hon. Friend to do everything possible to meet the bookmakers in this matter if there are not insuperable legal obstacles? [HON. MEMBERS: "Why?"] This is an unfair tax. Not only that, but it will lead to a loss of revenue in the long run for local authorities.
Mr. Jenkins: That is a much wider issue. Although I normally agree with my hon. Friend, I do not agree with him on that. Without question, what was done—whether it was wise or not—was to attempt to meet a bookmaker's difficulty. Certainly, the lesson I draw is that it is perhaps dangerous to be too generous to bookmakers.
Mr. Boyd-Carpenter: Is the Chancellor aware that in its recent report, the Public Accounts Committee criticised both the Revenue and the Customs for granting tax concessions which, however benevolent in intention, were made without statutory authority? As the observations of the Lord Chief Justice, to which my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) has referred, are of a general character, will the Chancellor now proceed to put these concessions on a proper statutory basis and subject ot the consent of Parliament?
Mr. Jenkins: I will certainly take that into account, although the history of extra-statutory concessions of the sort to which the right hon. Gentleman refers is a long one going back under many Chancellorships and several Administrations. The right hon. Gentleman has to some extent put the matter into perspective by referring to the wide range of extra-statutory concessions which already exist.
Mr. Sheldon: Surely my right hon. Friend is only following a long and honourable tradition of allowing time for payment as and when the Department can so organise it.
Mr. Jenkins: Certainly, the desire is to allow time for payment, although the question is how this stands exactly technically in relation to the Statute.
Dame Irene Ward: As the Chancellor has not answered my right hon. Friend's

427
specific question, would he kindly inform the House whether it is usual for the Treasury to make a habit of giving the answer that things are technically and administratively possible when it either does not want to deal with the matter or thinks that that is a more sympathetic answer which will soothe the House into acceptance of the point of view expressed?
Mr. Jenkins: No, not at all. Some things are technically and administratively impracticable. Indeed, I notice that there is a report to the House, published today, on this very matter.
Mr. Barnett: May I ask my right hon. Friend not to allow the Scrooge-like attitude of the right hon. Member for Enfield, West (Mr. Iain Macleod) to prevent him continuing what has been going on for a long time, whereby tax collectors on occasion adopt a somewhat flexible and understandable approach? Will my right hon. Friend confirm that in questions of income tax and corporation tax, for example, particularly in present liquidity shortages, he will not stop tax collectors giving the concessions which they have been giving for a long time?
Mr. Jenkins: I do not think that that arises absolutely directly on the question which has been asked. I would certainly have no immediate intention of proceeding in the direction which my hon. Friend has mentioned and which would, I am sure, be unwelcome to right hon. Gentlemen and hon. Members opposite.
Sir Harmar Nicholls: Is the Chancellor aware that, quite apart from the technical and legal points made by my right hon. Friend, many of us object to the language which the right hon. Gentleman used in his original reply? To call this a "concession" when it is merely extending the payment of a tax which is unfair and extortionate really is straining the English language.
Mr. Jenkins: No, Sir. If the hon. Gentleman thought that the tax was unfair and unreasonable he should have voted against it.
Mr. Dalyell: Has my right hon. Friend any notion of the administrative cost involved? And will not some of the
428
remarks from the other side of the House come rather strangely from a party which is always lecturing us on cutting the Civil Service?
Mr. Jenkins: I cannot give an estimate to my hon. Friend in reply to his first question, but I take note of the point in his second.
Mr. Lubbock: Did the Chancellor know that it was the officially declared policy of the Tory Party to mitigate the harmful effects of taxation? In view of that, is it not rather surprising that so many criticisms are directed from this side of the House to the concession?
Mr. Jenkins: I have long since given up attempting to find consistency in the policies of the Tory Party.
Sir H. Legge-Bourke: Will the Chancellor bear in mind that this is another example of the tendency, which is on the increase, of the Treasury to disregard this House? Would he, particularly in this context, reconsider the evidence given to the Select Committee on Science and Technology by the Clerk of the House on this subject?
Mr. Jenkins: I have no desire at all to disregard this House. Indeed, in what I am doing here I am following a suggestion which the right hon. Gentleman said was made by him.
On the specific point of the evidence to the Select Committee on Science and Technology, although I am sure it is of importance I do not believe that it arises specifically on this Private Notice Question.

BILLS PRESENTED

  PORTS BILL
  Mr. Frederick Mulley, supported by Mrs. Secretary Castle, Mr. Secretary Ross, Mr. Secretary Thomas, Mr. Roy Mason, Mr. John Diamond, and Mr. Albert Murray, presented a Bill to make, for Great Britain, further provision with respect to the improvement, maintenance and management of harbours and the carrying on of harbour operations (including provision for the transfer of certain harbours and harbour businesses to a National Ports Authority), and with respect to employment at or in connection with harbours, and with respect to incidental or consequential matters; and

  429
  for other purposes connected therewith: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 48].

  CHRONICALLY SICK AND DISABLED PERSONS BILL
  Mr. Alfred Morris, supported by Mr. Jack Ashley, Dr. Shirley Summerskill, Mr. Neil Marten, Dr. Winstanley, Mr. Will Griffiths, Mr. John Astor, Mrs. Lena Jeger, Mr. George Darling, Mr. Lewis Carter-Jones, Sir Clive Bossom, and Mr. Laurence Pavitt, presented a Bill to make further provision with respect to the welfare of chronically sick and disabled persons; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 5th December and to be printed. [Bill 21].
  PLANNING BLIGHT AND WORSENMENT BILL
  Mr. Walter Clegg, supported by Mr. Hugh Rossi, Mr. Anthony Grant, Mr. Timothy Kitson, Mr. Edwin Brooks, Mr. James Allason, and Mr. Tom Boardman, presented a Bill to amend the law relating to town and country planning, compulsory purchase, compensation for compulsory purchase, betterment, injurious affection, severance and planning blight; to make further provision in connection with planning blight; to provide compensation for persons whose land is adversely affected by the actions of local or public authorities or government departments; to make provision for worsenment; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday, 27th February and to be printed. [Bill 22].
  CONSERVATION OF SEALS BILL
  Mr. John M. Temple, supported by Mr. Burden, Mr. Deedes, Sir Hugh Munro-Lucas-Tooth, Mr. John Page, Sir George Sinclair, Mr. Archie Manuel, Mr. Arnold Shaw, Mr. Alfred Morris, and Mr. Patrick Wall, presented a Bill to provide for the protection and conservation of seals in England and Wales and Scotland and in the adjacent territorial waters: And the same was read the First time; and ordered to be read a Second time upon Friday, 12th December and to be printed. [Bill 23].
  RACE RELATIONS (AMENDMENT) BILL
  Mr. David Steel, on behalf of Mr. Jo Grimond, supported by Dr. Winstanley, Mr. Russell Johnston, Mrs. Winifred Ewing, Sir George Sinclair, Mr. John P. Mackintosh, Mr. Brian Walden, and Mr. Esmond Wright, presented a Bill to amend the Race Relations Act 1968 in respect of advertisements and notices and the investigation of complaints arising therefrom: And the same was read the First time; and ordered to be read a Second time upon Friday, 6th February and to be printed. [Bill 24].
  RIGHT OF PRIVACY BILL
  Mr. Brian Walden, supported by Mr. Douglas Houghton, Sir Edward Boyle, Mr. Eric Lubbock, Mr. Alexander Lyon, Mr. Gilbert Longden, Mr. S. C. Silkin, Mr. Kenneth Baker, Mr. Stanley Orme, Mr. Emlyn Hooson, Mr. John Biffen, and Mr. William Wilson, presented a Bill to establish a right of privacy, to make consequential amendments to the law of evidence, and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday, 23rd January, and to be printed. [Bill 25].
  INERTIA SELLING BILL
  Mr. Arthur Davidson, supported by Mr. Tony Gardner, Mr. Tom Bradley, Dame Joan Vickers, Mr. James Wellbeloved, Mr. Montgomery, Dr. Winstanley, Mr. W. T. Williams, Mr. William Hamilton, Mr. Lewis Carter-Jones, Mr. Philip Goodhart, and Mr. Richard Marsh, presented a Bill to make provision for the greater protection of persons buying or receiving goods or services at home or at a private place of residence or place of work; to regulate the conduct and consequences of inertia selling; and for purposes connected therewith: And the same was read the First time; and ordered to be read a Second time upon Friday, 30th January, and to be printed. [Bill 26].

  LICENSING OF MARRIAGES ON UNLICENSED PREMISES BILL
  Mr. Victor Goodhew, supported by Mr. Michael Alison, Mr. John Biggs-Davison, Sir Cyril Black, Sir Eric Bullus,

  431
  Mr. James A. Dunn, Sir Robert Grant-Ferris, Mr. Norman St. John-Stevas, Mr. Brian Walden, Mr. Donald Coleman, Mr. Raymond Gower, and Mr. Arthur Davidson, presented a Bill to permit marriages on unlicensed premises; and for purposes connected therewith: And the same was read the First time; and ordered to be read a Second time upon Friday, 13th February, and to be printed. [Bill 27].

  PROTECTION OF PENSION RIGHTS BILL
  Miss Quennell, supported by Sir Brandon Rhys Williams, Miss Mervyn Pike, Mr. John Pardoe, Mr. Simon Wingfield Digby, Mr. Charles Fletcher-Cooke, Mr. Tim Fortescue, and Mr. Edward du Cann, presented a Bill to amend the law relating to schemes providing pensions, annuities, retirement and other benefits: And the same was read the First time; and ordered to be read a Second time upon Friday, 20th February, and to be printed. [Bill 28].
  ABORTION LAW (REFORM) BILL
  Mr. Bryant Godman Irvine, presented a Bill to amend the Abortion Act 1967: And the same was read the First time; and ordered to be read a Second time upon Friday, 13th February, and to be printed. [Bill 29].
  DEER HUNTING AND HARE COURSING ABOLITION BILL
  Mr. Arnold Shaw, supported by Mr. John Ellis, Mr. Kevin McNamara, Mr. Eric S. Heffer, Mr. James Wellbeloved, Mr. Laurence Pavitt, Mr. Edwin Brooks, Mr. Denis Coe, Mr. Robert Sheldon, Mr. Richard Mitchell, Mr. Kenneth Marks, and Mr. Marcus Lipton, presented a Bill to abolish the hunting of deer and coursing of hares: And the same was read the First time; and ordered to be read a Second time upon Friday, 12th December, and to be printed. [Bill 30]

  NATIONAL INSURANCE (FURTHER PROVISIONS) BILL
  Mr. Nicholas Scott, supported by Mr. Airey Neave, Mr. Turton, Dame Irene Ward, Dame Joan Vickers, Mr. Peter Emery, Colonel Sir Tufton Beamish, Mr. Terence L. Higgins, Mr. Richard Hornby, Mr. Tom Fortescue, and Mr. John Boyd-Carpenter, presented a Bill to make provision for the payment of pensions out
  432
  of the National Insurance Fund for certain classes of person not eligible for pensions under the National Insurance Act, 1946: And the same was read the First time; and ordered to be read a Second time upon Friday, 30th January, and to be printed. [Bill 31].

  STAMP BILL
  Sir Neill Cooper-Key, supported by Mr. Bryant Godman Irvine, presented a Bill to abolish stamp duty on receipts: And the same was read the First time; and ordered to be read a Second time upon Friday, 20th February and to be printed. [Bill 32].
  COPYRIGHT BILL
  Mr. Raymond Gower, supported by Mr. Hugh Jenkins, Sir Stephen McAdden, Mrs. Jill Knight, Mr. William Wells, Sir John Langford-Holt, Mr. George Darling, Mr. Eric Lubbock, Mr. David Crouch, Mr. Iremonger, Dr. Hugh Gray, and Mr. Norman St. John-Stevas, presented a Bill to amend the Copyright Act, 1956, so as to make provision for the subsequent variation by the Performing Rights Tribunal of orders made pursuant to Section 27 of that Act: And the same was read the First time; and ordered to be read a Second time upon Friday, 20th February, and to be printed. [Bill 33].
  BRITISH STANDARD TIME (ABOLITION) BILL
  Mr. Godber, supported by Mr. Bryant Godman Irvine, Mr. Anthony Stodart, Mr. Peter Mills, Mr. Ian MacArthur, Mr. Michael Jopling, Mr. Hector Monro, Mr. Timothy Kitson, Mr. Deedes, and Mr. Keith Stainton, presented a Bill to abolish British Standard Time within the United Kingdom and to authorise the resumption of Greenwich Mean Time with variants as hitherto: And the same was read the First time; and ordered to be read a Second time upon Friday, 23 rd January, and to be printed. [Bill 34].

  LAW REFORM (MISCELLANEOUS PROVISIONS) BILL
  Mr. David Ensor, supported by Mr. Julius Silverman, Mr. Garrett, Mr. David Watkins, Mr. Norman Miscampbell, and Mr. Jack Dunnett, presented a Bill to abolish actions for breach of promise of marriage and make

  433
  provision with respect to the property of and gifts between, persons who have been engaged to marry; to abolish the rights of a husband to claim damages for adultery with his wife; to abolish actions for the enticement or harbouring of a spouse, or for the enticement, seduction or harbouring of a child; to make provision with respect to the maintenance of survivors of void marriages; and for purposes connected with the matters aforesaid: And the same was read the First time; and ordered to be read a Second time upon Friday, 5th December, and to be printed. [Bill 35].

  REPRESENTATION OF THE PEOPLE BILL
  Dr. Winstanley, supported by Sir Gerald Nabarro, Mr. Peter M. Jackson, Mr. Eric Lubbock, Sir Harmar Nicholls, and Mr. Brian Walden, presented a Bill to amend the Representation of the People Acts so as to require the issue of the writ for the holding of a by-election within a specified period from the date of vacation of the seat: And the same was read the First time; and ordered to be read a Second time upon Friday, 6th February, and to be printed. [Bill 36].
  CRIMINAL JUSTICE (AMENDMENT) BILL
  Mr. Anthony Berry, supported by Mr. Jasper More, Mr. David Crouch, Mr. Deedes, Mr. David Waddington, Mr. John Page, Mr. Eldon Griffiths, Sir Ronald Russell, Mr. John Astor, and Mr. Percy Grieve, presented a Bill to amend the Criminal Justice Act 1967 in relation to publicity for committal proceedings before magistrates' courts: And the same was read the First time; and ordered to be read a Second time upon Friday, 27th February and to be printed. [Bill 37].
  INFANTICIDE BILL
  Mr. Donald Coleman, supported by Mr. Leo Abse, Dame Irene Ward, Mr. James A. Dunn, Dr. Shirley Summerskill, Dr. Winstanley, Dr. Miller, Mr. W. T. Williams, Dame Joan Vickers, Mr. Ifor Davies, Mr. David Howell and Mrs. Lena Jeger, presented a Bill to amend the law relating to infanticide: And the same was read the First time; and ordered to be read a Second time upon Friday, 6th February, and to be printed. [Bill 38].
  DISABLEMENT COMMISSION BILL
  Colonel Sir Tufton Beamish, supported by Mr. Jack Ashley, Mr. John Astor, Mr. Lewis Carter-Jones, Mr. James A. Dunn, Mr. James Griffiths, Mr. Alasdair Mackenzie, Mr. Neil Marten, Mr Jasper More, Mr. Afred Morris, Dame Irene Ward, and Mr. Marcus Worsley, presented a Bill to establish a Commission to review pensions and benefits for the disabled and to make recommendations on changes and additions: And the same was read the First time; and ordered to be read a Second time upon Friday, 20th March, and to be printed. [Bill 39].
  TRESPASS BILL
  Mr. Peter Emery, supported by Sir Ian Orr-Ewing, Mr. Deedes, Sir Ronald Russell, Mr. Charles Fletcher-Cooke, Sir Douglas Glover, Mr. Peter Mills, Sir Eric Errington, Mr. John Osborn, Mr. David Howell, Mr. Albert Costain, and Mr. Patrick McNair-Wilson, presented a Bill to amend the law relating to trespass: And the same was read the First time; and ordered to be read a Second time upon Friday, 23rd January, and to be printed. [Bill 40].
  COLLECTIONS OF MANUSCRIPTS (PRESERVATION) BILL
  Mr. Marcus Worsley, supported by Mr. David Marquand, and Mr. Philip Goodhart, presented a Bill to encourage the preservation of collections of manuscripts by controlling and regulating their export and by amending the law relating to their acceptance in lieu of Estate Duty: And the same was read the First time; and ordered to be read a Second time upon Friday, 12th December, and to be printed. [Bill 41].
  PARISH COUNCILS AND BURIAL AUTHOR ITIES (MISCELLANEOUS PROVISIONS) BILL
  Sir Frank Pearson, on behalf of Mr. Michael Jopling, presented a Bill to amend the law relating to the administration and provision by parish councils of allotments and signs and of burial grounds by burial authorities, and for matters connected therewith: And the same was read the First time; and ordered to be read a Second time upon Friday, 30th January, and to be printed. [Bill 42].
  LOCAL GOVERNMENT (FOOTPATHS AND OPEN SPACES) (SCOTLAND) BILL
  Mr. Tom McMillan, supported by Mr. Gregor Mackenzie, Mr. William Small, Mr. Adam Hunter, Mr. John Robertson, Mr. George Willis, and Mr. Cyril Bence, presented a Bill to confer on local authorities in Scotland power to take over the control and maintenance of certain footpaths, and to construct and maintain certain footpaths; to authorise local authorities in Scotland to acquire or maintain certain open spaces; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday, 5th December, and to be printed. [Bill 43].
  PROTECTION OF UNIT TRUSTS INVESTORS BILL
  Mr. Keith Stainton, supported by Mr. Jasper More, Miss Quennell, Sir Ronald Russell, Mr. Bruce-Gardyne, and Mr. Raymond Gower, presented a Bill to amend the law affecting unit trusts and to make provision for valuations and financial liquidity as regards unit trusts investing in real estate, and otherwise to make provision about matters incidental to the protection of investors in unit trusts, and for purposes connected therewith: And the same was read the First time; and ordered to be read a Second time upon Friday, 13th February, and to be printed. [Bill 44].
  FIFTY-PENCE COIN WITHDRAWAL BILL
  Mr. Turton, supported by Sir Donald Kaberry, Mr. Michael Clark-Hutchison, the Earl of Dalkeith, Mr. John Farr, Sir Ronald Russell, Mr. Julian Ridsdale, Mr. Bruce Campbell, and Mr. Alasdair Mackenzie, presented a Bill to provide for the replacement of the 50-pence coin by a note of the same denomination: And the same was read the First time; and ordered to be read a Second time upon Friday, 12th December, and to be printed. [Bill 45].
  RACE RELATIONS BILL
  Mr. George Currie, supported by Mr. Ray Mawby, Mr. Victor Goodhew, Mr. John E. Maginnis, Sir John Langford-Holt, Mr. Donald Williams, Mr. John Nott, Mr. Drayson, and Mr. James Dance, presented a Bill to amend the Race Relations Act 1968: And the same was read the First time; and ordered to be read a Second time upon Friday, 27th February, and to be printed. [Bill 46].
  TRADE DISPUTES BILL
  Mr. Ray Mawby, supported by Sir Frederick Bennett, Mr. Drayson, Mr. Victor Goodhew, Sir John Langford-Holt, and Mr. James Dance, presented a Bill to restrict exemption from liability to actions for tort to registered trade unions: And the same was read the First time; and ordered to be read a Second time upon Friday, 6th February, and to be printed. [Bill 47].
ORDERS OF THE DAY

  CUSTOMS (IMPORTS DEPOSITS) BILL
  Considered in Committee.
  [Mr. HARRY GOURLAY in the Chair]

Clause 1

  AMENDMENTS OF CUSTOMS (IMPORT DEPOSITS) ACT 1968
  3.48 p.m.
  Mr. Michael Alison: I beg to move Amendment No. 1, in page 1, line 16, leave out 'two years' and insert 'eighteen months'.
  One of the merits of this Amendment is that it writes the word "months" into the Clause and thus restores something of the; psychological impact which the Chancellor of the Exchequer clearly sought to give to the Bill at its birth. There is no doubt at all that the original concept of the Bill was of a short, sharp shock. The shock was quite specifically to be a direct reduction in imports on account of the difficulty and cost of obtaining credit, and the time scale—and I have no doubt that the Financial Secretary appreciates this point—of the original scheme was conceived in terms of months and not of years.
  I make no apology for reminding the Committee that the Chancellor himself underlined this as being a matter of months rather than years when he said, on 22nd November, 1968:
  "The scheme is not one which can or should be kept in being for more than a limited period, but it will have powerful effects over the next few months when we most need its benefit."—[OFFICIAI REPORT, 22nd November, 1968; Vol. 773, c. 1796.]
  I think that the Committee will see that it is for a good reason that we seek a form of words for the duration of the Bill which emphasises a monthly rather than a year long time scale.
  Whatever else may be vague or uncertain about the impact of import deposits, it is abundantly clear that the scheme has not fulfilled the original expectations, either in terms of reducing imports or of making credit more difficult to obtain. It has perhaps made credit more costly to obtain, but hardly more difficult.
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  I will deal, first, with the argument about the impact upon imports. I could quote a great many Board of Trade and other statistics to make the point that imports of the non-exempted category of goods, so far from going down, have actually increased, but I will confine myself to one set of figures which gives us all the material we need to prove the point we are seeking to make. The figures were given by the Financial Secretary on Second Reading:
  "Since the scheme, imports of exempted goods have grown by 3 per cent. and those of non-exempted goods have grown by 6½per cent.
  Prima facie, there is a clear rate of increase of non-exempted goods of about 100 per cent. They have increased at double the rate of exempted goods in the period since the import deposits scheme came in.
  The Financial Secretary then gave us a long spiel, if I may put it as crudely as that, about how, relatively, he could argue that the rate of increase behaved—
  The Financial Secretary to the Treasury (Mr. Dick Taverne): Did argue.
  Mr. Alison: All right, I allow the Financial Secretary that point.
  The Financial Secretary argued, and I hope to show totally ineffectively, that relatively the rate of increase of non-exempted goods over exempted goods has been marginally less in the period since the import deposits scheme came in as compared with the period between 1964 and the end of 1968, when import deposits started. But the argument which he has adduced, looked at coldly and detachedly, is a matter of pure semantics and attempted brainwashing. He said:
  "So the difference between the rate of increase in non-exempt and exempt goods has dropped from nearly three times to just over twice."—[OFFICIAL REPORT, 17th November, 1969; Vol. 791, c. 878.]
  If one analyses that argument, it is like a couple of small boys aged 10, one of whom wants to pretend that he is a bit older than he is so that he can get into a cinema to see an X film, and the other wants to pretend that he is slightly younger than he is to qualify for cheap seats. The boy pretending to be older says that he is just a few months short of 11; the boy pretending to be younger says that he is only a few months over

  439
  10. They are both exactly the same age. The Financial Secretary argued that the rate of increase has dropped from nearly three times to just over twice, and this amounts to exactly the same thing, if one looks at it carefully.
  Between the two periods the rate of growth of the G.N.P., which is the key, has dropped. The average in the period 1964–68 was about 2·1 per cent. to 2·2 per cent per annum, and in the period during which import deposits have applied the rate of growth has dropped by about 25 per cent., from over 2 per cent. to about 1½ per cent., that is to say, a quarter—
  Mr. Joel Barnett Mr. Joel Barnett (Heywood and Royton) rose—
  Mr. Alison: The imbalance lies in the other direction. Against a reduction in the rate of growth of the G.N.P. of as much as 25 per cent. between the two periods the Financial Secretary gave us, we see that the buoyancy of non-exempt goods, which relate particularly to the products which one would look for in the context of economic growth, has barely gone down and has continued at twice the rate of the exempt goods. The Financial Secretary cannot pretend that the import deposits scheme, against the background of this severe decline in the rate of growth of G.N.P., has had a traceable effect. I believe that it has actually been perverse and has helped to make the goods buoyant.
  Mr. Barnett: Is the hon. Gentleman arguing honestly? He said that this has had no effect on liquidity. He is now arguing that neither is it having any effect on the level of imports. Is he telling the Committee that it has not prevented even a marginal increase, which is all that the former Financial Secretary suggested that it would do?
  Mr. Alison: The hon. Member forgets that the Chancellor of the Exchequer specifically said that there would be a direct reduction in imports. I have reminded him that exactly the opposite has happened: exports have gone up by 6½ per cent. which is twice the rate of the exempted goods.
  As I sought to show on Second Reading, there is some evidence that there is a perverse factor at work, and that the
  440
  effect of import deposits has been to bring forward the stocking up by industry of goods which are subject to the import deposits scheme.
  I turn now to the second argument to which the Financial Secretary gave special emphasis in his speech on 17th November. The Committee will note with some amusement the emphasis given by the Financial Secretary, in contradistinction to the Chancellor of the Exchequer, to what he described as
  "… its contribution to the successful policy of credit restraint."—[OFFICIAL REPORT, 17th November, 1969; Vol. 791, c. 872.]
  The more one looks at the argument of the successful policy of credit restraint that the Financial Secretary elevated to the top position of his justification for import deposits, the more bizarre the argument becomes. If credit restraint was originally adduced, and it was adduced by the Chancellor of the Exchequer as a principal factor in the direct reduction in imports, and there has been no such direct reduction in imports—on the contrary, imports of non-exempted goods have tended to go up—it can hardly be argued that there has been a successful policy of credit restraint in the non-exempted categories. If the argument is that credit restraint is indissolubly linked to the success or failure of the import level of non-exempted goods, and if the level of non-exempted goods has continued to rise in terms of value and volume of imports, the argument about credit restraint has failed.
  If the Financial Secretary is still talking about the contribution to credit restraint, where is the policy of credit restraint meant to bite? Is it meant to bite, if not on the non-exempt category, on the exempt category? Is it argued that although the import deposits scheme is having no effect on the non-exempted category, in a perverse way it is having an effect on the exempted category? If it is, there is a good argument for knocking away the import deposits scheme in the hope that the non-exempted goods will behave in the same way as exempted goods. Perhaps it is argued that the effect—
  Mr. Taverne: The figures show that the exempted category grew faster relatively to previous periods than the non-exempted category. How does the hon.

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  Member reconcile this with the argument which he is advancing? I want to get his argument quite clear, so that I can answer it.
  4.0 p.m.
  Mr. Alison: It is simple enough to illustrate. The Financial Secretary said that they grew relatively faster. But when the figures are looked at carefully, they suggest that non-exempted goods grew at twice the rate in the period concerned as was the case with exempted goods. We are concerned with the relative rate of growth between the two categories.
  I argue that the period which the hon. Gentleman adduces as that in which exempted goods grew relatively more slowly, namely, the period 1964–68, is a period in which the rate of growth of G.N.P. was much greater than the period during which import deposits have applied. Therefore, the drop in rate of growth of G.N.P. should have resulted in a very much slower rate of growth in non-exempted goods than has occurred. In a period of very low rate of growth in gross national product, one would expect there to be a much faster fall in the kinds of imports of goods which are essential for economic growth. But, on the contrary, the difference in the two periods is hardly perceptible, whereas the difference in the period with which we are concerned in regard to G.N.P. is 25 per cent. less. No doubt the Minister will deal with this matter in his reply.
  I come back to credit restraint. Where is it meant to apply? It has had no effect, so far as one can see, on the rate of increase in non-exempted goods. Is the Financial Secretary arguing that credit restraint applies to the exempted category, or is he thinking in terms of the economy as a whole? His argument about credit restraint strikes me as being thoroughly "phoney" in its entirety. The lie to his argument has been given by a throw-away line in a different part of his speech, a line which was damaging to his case. First of all, in column 872, he gave a figure of liquidity of about £550 million at present held by Customs.
  I am sure that the Financial Secretary would agree that it is reasonable to knock off a third as being the contribution made to those deposits by foreign suppliers. It can be said that, in round figures. some £400 million gross is tied
  442
  up by the import deposits scheme. But a couple of columns later, in column 875, he casually let out that we also know that in the June quarter the company sector added substantially, by about £300 million, to its net financial assets. First, there is the allegation that credit has been massively restrained by the net effect of the import deposits scheme by something like £400 million for a period of six months, but then the Financial Secretary says that the net financial assets in the company sector have increased in the June quarter by almost the full amount. That three-month period is half the period of the lock-up of import deposits. Those financial assets had increased in the one quarter by practically the whole amount of the import deposits.
  One may well inquire where is the credit restraint effect of import deposits if the monetary and fiscal environment in which they operate is such that it can almost entirely affect that credit restraint by allowing sufficient liquidity elsewhere to acquire financial assets on that scale.
  The Financial Secretary is misleading the Committee if he tries to persuade it that the credit effect, which has had no effect on the scale of non-exempted imports, justifies keeping on the scheme for a further 12 months as opposed to the period of six months which is the period for which we are asking. It shows the fatuousness of the Government's fiscal and monetary policy. They cannot pretend that a net tying up of £400 million in import deposits for six months means anything, when at the same time the Chancellor of the Exchequer had budgeted for a growth in domestic credit expansion of exactly the same amount. The credit argument in this context is meaningless.
  It becomes increasingly difficult to see what conceivable grounds there are for the Government wishing to keep on this totally ambiguous and almost counterproductive Bill.
  Mr. J. Bruce-Gardyne: Would my hon. Friend not agree that the fact there was a domestic contraction in the first quarter of the financial year is a factor which suggests that the overall movement of credit has been in a contractive direction? Although I accept all that he has said about the irrelevance of the import deposits scheme within the

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  overall picture, does the evidence not suggest that there has been a severely contractional process in operation this year?
  Mr. Alison: My hon. Friend will appreciate that the D.C.E. figures fluctuate erratically on a quarterly basis and that the upturn in D.C.E. has already started. I am prepared to base myself on what the Chancellor of the Exchequer has said. He said that he saw no reason to believe that D.C.E. would not increase taking the year as a whole—and the year ends after the revenue quarter—by the figure which he originally adduced. One reason is that the private sector is to be a substantial net seller of gilts in the revenue quarter, which is the quarter in which the big D.C.E. figure will arise.
  I have no doubt that the Chancellor's increase in D.C.E. completely offsets the credit restraint which the Chancellor has attempted to exercise through import deposits. Against this background of the ambiguous and perverse results of import deposits, what is clear is that our international trading partners do not like the deposits. I quote from the official communiqué issued after the E.F.T.A. Ministerial meeting on 6th and 7th November. There we read that the Ministers of other E.F.T.A. countries
  "… while welcoming recent evidence of the improvement in the economic situation of the United Kingdom, expressed concern at the continuance of the import deposit scheme.…"
  They might well express concern when one sees that in the third quarter of 1969 our imports from E.F.T.A. countries rose by 8 per cent. and our exports to those countries rose by nearly three times that volume, namely, by 22 per cent. If they have any wish to try to adjust the rate of growth of trade between the two blocs, does the Financial Secretary believe they will not be tempted to have recourse to the same instrument which we have used to beat them with and that they themselves will not impose import deposits? This is the reason why the period should only be extended for six months less before they themselves get into the habit.
  I am happy to let the Chancellor of the Exchequer have the last word on the subject. He was in a rather defensive mood this afternoon. He attempted to suggest that he could never rely on the
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  Opposition for any consistency. I remind the Financial Secretary of these words by the Chancellor of the Exchequer at the end of the Budget debate in April, 1963:
  "It is extremely important that, at the outset of this period, Her Majesty's Government, of whatever party, should say, 'We are for expansion. We want to go on with expansion, and we want world monetary and trading policies which will help us. We shall not ourselves turn to restrictive measures of a monetary, tariff or restrictionist sort on imports unless we are absolutely forced to do so. We appeal to others to work with us to make this expansion possible.'"—[OFFICIAL REPORT, 8th April, 1963; Vol. 675, c. 1005.]
  What a background to this tawdry little Measure, introduced when the Government are achieving a rate of growth of under 2 per cent., and when, in that speech, the Chancellor of the Exchequer himself advocated a rate of growth of 8 or 9 per cent. against a background of decrying monetary, trading and fiscal restrictions on imports. The Chancellor now brings forward this tawdry little Bill, which seeks to extend the clearly ineffective 12 months' initial period by another 12 months. The least we can do is to ask the Committee to agree to cut by six months the period of extension proposed.
  Mr. Donald Chapman: The hon. Member for Barkston Ash (Mr. Alison) does himself no justice at all by that kind of speech. To pretend that economic analyses are as simple, as straightforward and as easy as he has been making out is little short of puerile. The first part of his argument was that as there was slow growth in the national gross product during this period one should expect the sort of slowing down of imports that has taken place. I believe that to be a fair summary of what he said. He says that therefore, in those circumstances, the import deposits scheme cannot have any effect. However, as his hon. Friend the Member for South Angus (Mr. Bruce-Gardyne) almost reminded him, things are a lot more complicated than that.
  In fact, we have to look at all sorts of factors in the rate of growth of imports. The rate of growth of imports depends, in addition to the things about which the hon. Gentleman has been talking, on relative price movements of imports and exports. It depends on the restructuring

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  of the economy which has been going on, during which period it is possible that, despite the low growth in the gross national product, stock building has been proceeding as a basis for future exports. It depends on credit generally.
  The hon. Gentleman does not do himself justice. After all the experience we have had during the last 15 years of erratic import figures which are, so to speak, one of the national crosses we have to bear in the modern day, after years of trying to cope with erratic import figures which have continuously bedevilled our balance of payments, it is just not good enough for the hon. Gentleman to say that it is all very simple, and that none of the steps, such as this Bill, that we have taken can be having any effect—
  Mr. Bruce-Gardyne: I interrupt only to say that the views the hon. Gentleman appears to be attributing to me were not expressed by me.
  Mr. Chapman: The hon. Gentleman was making it clear that he was having a number of second thoughts about the simplified approach of his hon. Friend. But if he wishes to opt out of the argument, I do not need to call him in aid.
  The hon. Member for Barkston Ash seems mesmerised by the statement made by the Chancellor of the Exchequer some time ago that the import deposits scheme would lead to a cut in imports. The hon. Gentleman seems to want to imply all the time that my right hon. Friend was saying that the scheme would lead to an actual physical fall in the total of imports. I do not think that my right hon. Friend was ever so stupid as to say or to imply anything of the kind. We have lived and are living in a period of rising imports, and world inflation alone will increase their cost each year even though the volume remains the same. What my right hon. Friend was saying was that the scheme would lead to a slowing down in the growth of imports, if growth were taking place, as would be the natural thing to expect in modern circumstances. I do not think for a moment that he ever wanted to imply that there would be a fall in the volume, and hence in the total value of imports.
  4.15 p.m.
  Mr. Alison: The hon. Gentleman must recognise that this is what the Chancellor of the Exchequer in the light of after events would have liked to have said, but what the right hon. Gentleman actually said was that the scheme would lead to a direct reduction in imports.
  Mr. Chapman: We have to take the whole context of the speech, which dealt with the national problem of a general, steady and never ending growth in our import bill. I would say that any Chancellor who ever said that he expected a small Measure like this to lead to a fall in the volume, and hence a fall in the total value of imports, was off his head, and whatever else my right hon. Friend may be he is certainly not that. He was talking in the total context of a fall in growth.
  We are arguing here about something much more puzzling, delicate and complicated than the hon. Gentleman made out. We are discussing how we may get together a package of measures of control over our balance of payments which makes sense in modern circumstances. That is why I put down an Amendment which would have continued the scheme for five years. I wanted to use it as a peg for a speech on the need for the Bill as part of our general armoury in fighting for balance of payments control, but I can make the same remarks on this Amendment, which seeks to reduce the period.
  What is at stake in arguing about how long the scheme should operate is our view of how we regulate the balance of payments. The distressing thing about the members of the Opposition Front Bench, who seem very light-headed about a number of things, is that they seem to imply that all this is very easy; that we can cut taxation, have a free-for-all, leave the import level to take care of itself and then suddenly, miraculously, happily and all too easily there will never be any trouble with balance of payments.
  The reality is that there are no soft options in economic policy, and both sides of the Committee should have learnt that by now. Pre-1964 we had a situation in which each time the balance of payments refused to come right we had a stop on production, on investment, on social spending and on full-time working,

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  which reached a point in 1961–62, in the time of the right hon. and learned Gentleman the Member for Wirral (Mr. Selwyn Lloyd), of utter disillusion in manufacturing industry, and a feeling that the ecnomy would never get right and restore confidence. In between, when this dreadful purgative medicine had had its effect, we had the alternative of a rather wild boom which we continually "kidded" ourselves could be kept in hand. When we found that it could not be kept in hand we were back to the old purgative of violent measures, destruction of confidence, and the rest. The result was an all-round lack of confidence in our economy.
  I do not, and could not, claim that since 1964 we have found an easy alternative. But we have found an alternative which is working and is not having the disastrous pre-1964 effects. [Interruption.] The right hon. Member for Enfield, West (Mr. Iain Macleod) may splutter, but he should talk to his friends in manufacturing industry. There is no lack of confidence in British industry today. We are managing to cure the balance of payments deficit and to move into surplus without destruction of confidence while laying the basis for a steady acceleration of growth which will now take place in annual production.
  So the option we have chosen as an alternative to a general recession of the stop-go type of 1961 is to try to get the economy in hand by using a package which has three features: a restructured economy slanted towards exports; slightly less full employment—less than I should like, but only slightly less—and a package of measures at home to hold back demand in imports. That package includes tighter money, a Budget surplus and things such as the import deposits scheme.
  This scheme is part of the total package we are using in a more sophisticated way than, for example, the right hon. and learned Member for Wirral used in 1961–62, to bring right the balance of payments situation while, at the same time, not destroying confidence—and while positively laying the foundations for more acceleration in growth of our national economy. That is why I stick to my view that the Amendment is quite wrong; that the reverse is exactly what
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  we need. We need to have this measure as part of our total permanent armoury so that, if an occasion like this arises again when unhappily we drift over the margin in the balance of payments situation, we can use this set of gentler measures, including this one, to bring the balance of payments right without total destruction of confidence which always went with the stop-go policies pre-1964.
  This is why I want this measure permanently on the Statute Book and why I complain against the Government for being so timid in falteringly putting it forward year after year at present, and why they say that we ought to get rid of it. We ought to have the power, never to use it, of course, in circumstances when we do not need it, but provided for use at will when something of this kind is needed on the margin.
  I come to the marginal point. The hon. Member for Barkston Ash still fails to realise the smallness of what we are trying to do. We have a total export-import Bill of about £12,000 million, £13,000 million, £14,000 million. Inside that figure we were stuck with a balance of payments deficit of about £200 million. This was the crucial figure which we could not get rid of, about 2 per cent. We were annually looking for little measures to get round the corner, as we said a year ago; and we had to do something because we had had this adverse margin for a long time. This was part of the general measures to get round that corner.
  On Second Reading, I quoted something which I had said last year. Now I want to quote something more. I said:
  "We are talking about trying to get a change at the margin. In £6,000 million"—
  I could have said £12,000 if we take exports as well as imports—
  "we want to cut out or delay £200 million."—[OFFICIAL REPORT, 28th November, 1968; Vol. 774, c. 847.]
  This is marginal and that is why this measure is so important and why it is effective, because we were never looking for more than very slight effects of a small size.
  I tried to deal with the point about E.F.T.A. when speaking on Second Reading, but I evidently failed to make an important point for the hon. Member for Barkston Ash, who has been so loud in his complaints about what E.F.T.A.

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  countries were thinking. He does not realise that the E.F.T.A. Secretariat, not many months ago, produced a report—we debated this at Strasbourg—showing the fantastic success of E.F.T.A. and showing how, over the years during which E.F.T.A. has been operating, the exchange of goods between the Seven has accelerated at a phenomenal rate.
  The hon. Member ought to think of the reaction of E.F.T.A. parliamentarians and Ministers. When they see a trading arrangement which is working so well, when they calculate—as they are sensible enough to do—the steady increase in exports to the United Kingdom which they have achieved year in and year out during E.F.T.A.'s existence, they are not likely to cavil fundamentally at something which restrains it within the level of what we in the United Kingrom can afford to pay for by our exports.
  The hon. Member still fails to realise the point about a cut in volume and a cut in the rate of growth. If we had been physically cutting our imports from E.F.T.A. they would be shouting, but all the E.F.T.A. countries know that we are restraining the rate of growth of goods from E.F.T.A. countries and they are happy with that situation. [Laughter.] The hon. Member may laugh, but E.F.T.A. countries have memories of what happened under the Administration of hon, Members opposite. Under their Administration, there would have been not this cut but a swipe, another version of stop-go, which would have meant a much more severe cut in their sales to us than all our measures as epitomised in the Bill.
  I am sorry that the Government, in introducing this Measure, are still failing to come before the House and to say, "We do not want to use this Bill any more than is necessary, but it is honestly part of a total package of the gentler kinds of restraints needed to run a modern economy". Let us have it on the Statute Book permanently. Let us have the power to use and revive it only when we need it and so that we do not need to have these annual debates when we need the power. That would be a more sensible way of doing it.
  I hope that when my hon. and learned Friend replies to the debate he will deal specifically with the question why the
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  Government will not take my view and put this Measure permanently on the Statute Book.
  Mr. John Nott (St. Ives): The hon. Member for Birmingham, Northfield (Mr. Chapman) has practised on himself an act of supreme self-deception. When the Financial Secretary to the Treasury gets up the next rung of the Treasury ladder— he is progressing very well and fast—the hon. Member will have to take his place, or the place of the Minister of State. Such acts of self-deception are badly needed on the Treasury Bench. For the hon. Member to describe the Government's total package as a mild one—I believe that that was the expression he used—is astonishing.
  The Government's total package has resulted in a small surplus on the balance of payments for the first time in five years, but it has come about following devaluation of the £, higher unemployment than this country has known since pre-war times, a lower growth rate than there has been for the last 24 years, and debts of £3,000 million which this party will have to repay after the next General Election. If the hon. Member really believes that is a mild package, what would he describe as a severe one? I found his attitude very strange indeed.
  To bring myself up-to-date, I took the opportunity today of speaking to one or two E.F.T.A. embassies in London. I assure the hon. Member that the feeling of distress and anger that the Government should continue this measure for a further year is very considerable among the E.F.T.A. countries. Most of them agreed when it was introduced that perhaps it was introduced force majeur. But now that the Government, who are so euphoric about the enormous success of the balance of payments, are continuing it, for reasons which we well know and to which I shall allude, I assure the hon. Gentleman that they are continuing it against the strong opposition of every E.F.T.A. country.
  4.30 p.m.
  I do not know why the hon. Gentleman wants such a measure to be in this country's total permanent armoury. If Britain remains, as I hope that it does, a major trading nation, it cannot be part of our total permanent armoury to have something which is, as the Government

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  admit, liable to restrict world trade. Whatever view may be taken of an import deposit scheme, it cannot be said to be an extension of the liberalisation of world trade from which Britain will benefit more than practically any other nation.
  The reason this measure has been extended was made perfectly clear in the Financial Secretary's comments on Second Reading:
  "It is clearly, therefore, a matter of common sense"—
  this is the nub of the whole thing; the hon. and learned Gentleman associates common sense with the Labour Party's electoral prospects—
  "to avoid at this particular time, in the next half-year, a monthly outflow from the reserves of £30 to £40 million which this foreign credit has represented."—[OFFICIAL REPORT, 17th November, 1969; Vol. 791, c. 876.]
  That is the nub of the issue.
  Mr. Chapman: One of the three.
  Mr. Nott: That is the major political reason for the extension of the scheme. If the Government take it off now, £30 to £40 million a month will flow out of the reserves. We all know why the Government are extending it. The Financial Secretary said so. It is no use the Government's being, on the one hand, so euphoric about their great three-month balance of payments success, which has amounted, if I calculate it aright, to a surplus of approximately £65 million over three months—I am talking about current account surplus—
  Mr. Taverne: Trade surplus.
  Mr. Nott: I am sorry—trade surplus over three months.
  It is the trade surplus to which the Government have been directing most of their comments recently. It is not good the Government's being euphoric about that, on the one hand, and then the Financial Secretary saying, "If we took the import deposits scheme off £30 to £40 million a month would flow out of the reserves". That would more than cancel the three months' very desirable and satisfactory current account trading surplus of £65 million which we have achieved over the past three-month period.
  Mr. Taverne: The hon. Gentleman surely would not underrate the importance of the invisibles.
  Mr. Nott: I never underrate the importance of the invisibles. They are very important indeed. I did not, however, refer to them. The Financial Secretary thinks of this import deposits scheme rather like pot—not "impot". He may refer to it as "grass" as a result of his wide experience of this subject when he was at the Home Office. The scheme is like pot, because it is a stimulant which, once tried, is very difficult to give up because the withdrawal symptoms from the scheme are very unpleasant. This is why the Government are keeping the scheme on.
  I do not want to be led into discussions now on the question of the expansion or contraction of credit. I follow the arguments advanced by my hon. Friend the Member for Barkston Ash (Mr. Alison) with interest, but I did not wholly agree with all of them. There will be other opportunities of speaking on this subject in this sparsely attended debate.
  In supporting the Amendment, I want to comment on one specific industry. I take the machine tool industry as but one example. Day by day the Government talk about the importance of expanding our manufacturing capacity and of the need for further investment. We all agree that this is crucial because, as soon as the brakes come off, if we have insufficient capacity Britain will once again run into a huge balance of payments problem as a result of more imports being sucked in. The expansion of capacity, particularly of more modern plant and machinery, is absolutely crucial to our future.
  I take one industry which I know something about, because I am connected with it—one portion of the engineering industry. As the Financial Secretary knows, the engineering industry is doing very well at the moment and is running very much at full capacity. The company with which I am associated—there are many similar companies in the economy—has increased its exports by about 60 per cent. in the last two years. The figure runs into many millions of pounds. It is not due to any efforts of mine. It is due to the efforts of those who are employed full time in the company.
  The capacity of the company is extraordinarily short. The only way in which we can continue to meet the overseas demand for our products is by ordering the

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  very latest, the best, the most heavy-purpose machinery in the world. We can buy the very best machinery in the world only if we are allowed to look around, check on what is the best machine tool produced by the Swiss, the Germans or the French, and buy the very best tool wherever it might be made. [Laughter.] The hon. Member for North-field laughs. He must agree that this is correct.
  Mr. Chapman: I am sure that it is right, but why does not the hon. Gentleman tell this to the hon. Member for Barkston Ash (Mr. Alison), who thinks that at the moment imports should be automatically going down because there is not such a good growth in the gross national product? The hon. Gentleman is now telling the hon. Member for Barkston Ash about all the complicating factors which go to the make-up of our import bill at the moment. At the same time, he is telling us how confident and buoyant the engineering industry is despite what he thinks are the terrible things that the Labour Government have been doing.
  Mr. Nott: My hon. Friend did not comment along the lines that the hon. Gentleman suggests. The hon. Gentleman completely misunderstood what my hon. Friend said. The hon. Member should not refer to the simple figures which my hon. Friend mentioned, because my hon. Friend was merely commenting on the figures which the Financial Secretary used to demonstrate his case. The Financial Secretary took the figures of imports, took the non-exempt and the exempt items, and took an extremely simpliste figure to demonstrate that perhaps this scheme was having a marginal effect on imports.
  My hon. Friend was merely commenting on the simpliste figures which the Financial Secretary took to demonstrate his case on Second Reading. I do not know whether the hon. Gentleman has read the speech made by the Financial Secretary on Second Reading. The hon. Member may not have been present during the debate. The Financial Secretary took the figures to which my hon. Friend the Member for Barkston Ash referred, to demonstrate that there had been a marginal reduction in imports. Why does the hon. Member criticise my hon. Friend for referring to those figures?
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  I return to the question of the engineering industry, which I amdit is doing very well. I do not know if the Government attribute the engineering industry's success to some measures which they have taken. I do not know what measures those could be. For the engineering industry to do well and meet the demand for its products, it must buy the very best machine tools wherever they may be throughout the world.
  This means purchasing machine tools abroad in certain cases—not in every case. Companies in Britain which are seeking to meet the demand for their products must either pay the import deposit themselves for buying the machinery or they have to pay approximately 3 per cent. more on the price of these foreign machine tools. At a time when the Government are trying to encourage foreign investment in Britain, it cannot be in the interests of our export trade to put this additional impost upon imported machine tools. I return to my original comment. We know why the Government have done it. They have done it because they have a small balance of payments surplus to crow about for the first time in four years, and they know that if they release the import deposit scheme now it will, as the Financial Secretary said, lead to an outflow from our reserves to the extent of £30 million or £40 million a month.
  I come to the nub of all the Government's actions, and this is the last point that I wish to make on this Amendment, unless the Financial Secretary provokes me into a further comment on this issue. It is this. One day the import deposits scheme has got to come off, and one day the £30 or £40 million has got to go out of the reserves. When will that happen? Will it remain till after the election? The Government have put round the necks of any future Government—I believe that it will be the necks of my party—the Basle Agreements.
  We also have the Deutche mark borrowing of the local authorities. Every single action that the Government have taken in the economic field in the last six months to a year has been calculated to meet the short-term balance of payments position, quite regardless of the medium and long-term effects on our economy.

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  The Financial Secretary in his Second Reading speech referred to comments which I made on the original Ways and Means Resolution. I do not intend to bore the Committee by commenting on it now, but I shall come back to it later. What I predicted then—contrary to what the Financial Secretary said—has come true. Among the comments I made was that the scheme would improve our balance of payments in the short term. But the Measure will do considetable medium and long-term damage if it remained, and this is the problem which we should be discussing—not the immediate short-term effect which is only beneficial to the Government in their attempts to win the next election, not to the country at large.
  Mr. Bruce-Gardyne: I entirely agree with my hon. Friend the Member for St. Ives (Mr. Nott) that one of the main reasons for the Government's request to us to renew this miserable little measure is in order to continue the process of shovelling their accumulated debts and their effect on to the next Conservative Government. Of course, this is right, and it is right to draw attention to the interest of the Government in escaping from the particular consequence of what my hon. Friend aptly described as the withdrawal symptom from this import deposit drug.
  The Financial Secretary held up his hands and waved three fingers when my hon. Friend referred to this as the reason. I do not agree that there are three reasons. I think that when we were discussing this matter on Second Reading I suggested there were four, but I will content myself with two this afternoon. I will come back to the second one in a moment.
  First, I want to draw attention to one argument which seems to me particularly to favour this Amendment. It is an argument which has not been referred to during the debate today. The hon. Member for Birmingham, Northfield (Mr. Chapman) seemed to have no knowledge of the fact—but then, that is hardly surprising since the Financial Secretary showed no awareness of it on Second Reading—that the application of this Act, if it is to continue for a year, will run through the period when, according to
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  the Government, we shall be opening negotiations for membership of the European Economic Community. I do not know where the hon. Member for North-field stood on this issue. I have not checked my facts, but I have no doubt that the Financial Secretary voted with the rest of the payroll vote.
  If we are to have the opening of negotiations for entry into full membership of the European Economic Community I can only suggest—to use a word which was so happily used by my hon. Friend the Member for Barkston Ash (Mr. Alison)—that it will look a little bizarre for us to have this particular form of financial restraint on imports in operation. I presume that the Financial Secretary will be trotting in the wake of the Prime Minister around the capitals of Europe, and that when the Prime Minister is told, "You understand, of course, that the purpose of this organisation is to eliminate barriers to trade, and yet you have got a rather nasty little barrier still operating which is against all the rules", the Financial Secretary will be there presumably to say, "Oh, yes, but it is only a little one and it is only temporary".
  4.45 p.m.
  The Financial Secretary's position would be a little happier if he were to accept this Amendment. At least, he would then be able to say, "Wait till June and then we shall remove this little indiscretion which we have committed and prolonged". If the Financial Secretary does not accept this Amendment it will be up to him to explain to the Committee how he will justify the retention of this Measure during a period when what we are led to understand are vitally important negotiations are to be undertaken, being negotiations which are totally in conflict with the spirit and the letter of the Bill.
  I also strongly support the Amendment because I disagree profoundly with what I regard as the second and ancillary reason for the Government's decision to seek renewal of the Customs (Import Deposits) Act. This is tied up very much with the reason to which my hon. Friend the Member for St. Ives (Mr. Nott) referred, because it is related directly to the balance of payments situation. This is the reason on which the Financial Secretary himself placed great emphasis in

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  his Second Reading speech, namely, the restriction of domestic credit.
  I agree with my hon. Friend the Member for Barkston Ash that a measure such as the import deposits scheme is, in isolation, strictly irrelevant to the overall measure of control which one applies to domestic credit. Obviously, the whole effect of retaining the import deposits scheme can be reversed simply, without any action taken officially by the Government or requiring the sanction of this House, by such a measure as, for instance, a decision to release the special deposit accompanied by a decision by the Government or by the gilt-edged broker to go into the market and buy gilts. This alone would wipe out any effect that the import deposits scheme would have in restraining domestic credit.
  Equally, the Government could decide, as they are urged by the hon. Member for Heywood and Roy ton (Mr. Barnett), to advance the payments of these titbits to the unprofitable—the investment grant. This would also have a not dissimilar effect. Therefore, I entirely agree with my hon. Friend that to single out the import deposit scheme as being an essential instrument for restraining domestice credit expansion shows a lamentable inability to understand the whole theory of money supply—not that I find that in the least surprising, coming from a Chancellor who throughout has shown total ignorance of and disinterest in the whole subject, although he has been frogmarched by the Treasury into pretending to apply these disciplines which he cannot be bothered to try too understand.
  What seems to be important is this—and this is my main reason, perhaps, for being only too delighted to support this Amendment in the Lobby this afternoon. I refer to the renewal of the import deposits scheme as a very sinister and specific piece of evidence of the Government's strategy.
  It is doubly related to the departure of the Paymaster-General from the Treasury. If the Paymaster-General had still been at the Treasury, he would never have allowed this Bill to be renewed in flagrant contravention of undertakings given by him to the I.M.F. which he would certainly have ensured were fulfilled. He is a man of honour,
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  and he would not have allowed the Bill to be renewed in this way.
  The right hon. Gentleman would have ensured that the Bill was not renewed for another important reason. The Paymaster-General was always insistent that we should not allow the achievement of some magical, ever more impressive balance of payments surplus to become a sort of national obsession. I used to think that he was somewhat premature in that line of argument. I thought that we should be better advised to move in to surplus at least before we started to run down the size of the balance of payments surplus at which we were aiming. But at this stage it seems to me that in the absence of the Paymaster-General's guiding hand the Chancellor has become absolutely obsessed by the need for some ever more glamorous and glorious sounding balance of payments surplus, regardless of the impact which that may have on the economy.
  The decision to renew the import deposits scheme should be seen in that light, as an outward and visible sign of an inward and invisible determination on the part of the Treasury to pursue a degree of severity in credit restraint designed to achieve an ever more inflated balance of payments surplus regardless of the effect on the economy at home.
  We must regard the impact on domestic investments of the proposal before us against that background. I was interested, but profoundly alarmed, to read a reply by the Chief Secretary to a Question by my hon. Friend the Member for Oswestry (Mr. Biffen) yesterday, when my hon. Friend asked the Chancellor of the Exchequer,
  "what assessment he has made of the general effects of the Government's monetary policy; and whether he will now dismantle certain selective methods of monetary restraint"—
  The Deputy Chairman (Mr. Harry Gourlay): Order. I remind the hon. Gentleman that we are not having a Second Reading debate. We are dealing with an Amendment to Clause 1, in line 16. Perhaps he will address his remarks more specifically to that Amendment.
  Mr. Bruce-Gardyne: Certainly, Mr. Gourlay. The point I am seeking to make is that the effect of renewing the Bill without—
  The Deputy Chairman: The point is that we are not discussing the Bill. We are discussing an Amendment. The principle of the Bill has already been established by the House.
  Mr. Bruce-Gardyne: I accept that, Mr. Gourlay, but the point which I am seeking to advance is that, if we were to approve the Bill without the Amendment, the effect would be still more severely to restrain domestic credit, with the ancillary effect on manufacturing investment. I was drawing attention to the exchange between my hon. Friend the Member for Oswestry and the Chief Secretary precisely because, as I hope to show, it suggests an alarming degree of complacency in the Government about the effect of deciding to renew the import deposits scheme in all its vigour for a full year, as opposed to the restricted time suggested in the Amendment.
  My hon. Friend drew attention to the fall in liquidity in British industry of about £70 million to £80 million, disclosed by the November Financial Statistics, and he asked the Chief Secretary:
  "Is he aware that that will have considerable consequences for the level of industrial investment?".
  The Chief Secretary replied:
  "There is no question of complacency."—[OFFICIAL REPORT, 25th November, 1969; Vol. 792, c. 193.]
  Throughout some years of watching the Chief Secretary in operation, I have always regarded him as a pillar of complacency. [HON. MEMBERS: "NO."] Yes, he used to pretend that the rate of growth in the money supply was totally irrelevant, right up to the day when the Chancellor said that it was at the basis of all his preoccupations. There has been a dangerous degree of complacency about the domestic internal effects which a continuation of this measure for another full year might have on our manufacturing investment.
  To conclude, I hope that the Financial Secretary will answer a question which he was asked on Second Reading but to which he never replied. Before rejecting this Amendment, as, no doubt, he will ask us to do, we must have a reply to this question. Why did the Government decide to change their mind about the renewal of the import deposits scheme between July—and the Chancellor's
  460
  Letter of Intent to the I.M.F. which he told us was based on the calculation that the import deposits scheme would not be renewed—and October, when he decided to renew it? What occurred in the interval to persuade the Government to change their mind? If we are asked to renew the scheme for a full 12 months, we should have an explanation of that last-minute change in the Government's thinking.
  Mr. Ted Leadbitter (The Hartle-pools): Having spoken on this Bill on a previous occasion, and having heard the debate today, I find it exceptionally difficult to say anything new. One of the difficulties, even with the Amendment before us, is to discover any new feature which could sway opinion on one side or the other. But there is one thing quite certain: when an Amendment of this kind is put down, reducing a period of two years to 18 months, either we accept the intent of the Amendment as sincere or we do not.
  If therefore, it is the Opposition's case that the Bill is wrong, basically wrong in itself, one must question why the Amendment is there. On the other hand, there is another option. Hon. Members opposite might be split; some might believe in it, and some might not, so their Front Bench put down an Amendment. I notice that the right hon. Member for Enfield, West (Mr. lain Macleod)—I am sorry that he has left—sat there quite placid and content, and it did not seem to be a moment of great import to him. Nevertheless, he will have noticed, as I have, that hon. Members opposite, whether they like it or not, have argued sometimes in favour of the Bill and sometimes not.
  When we have this kind of mix, one wonders at the small attendance in the Chamber. Apparently, for some hon. Members the Bill creates a great crisis. To others, it is a small marginal thing, as some of us would like to describe it. But, looking at the numbers at present in the Chamber, one is forced to conclude that, perhaps, the right hon. Member for Enfield, West, was wise to leave. There is one constant to be discovered even among a split, poorly-attended assembly. Hon. Members opposite are forever drivelling that when things are going right that is the result of private

  461
  enterprise, and that when they are going wrong that is the Government's responsibility. They have neither grace nor common sense on this subject.
  5.0 p.m.
  When we think in terms of the marginal improvement from the Bill, which helps us turn the corner, against a general background of imports and exports worth well over £12,000 million, and bear in mind that we are dealing with £3,000 million of that, we find it surprising that there can be hon. Members opposite who will minimise the significance of the Government's calculated intention.
  The background to the problem has confused politicians for decades. When did we last have a favourable balance of trade? I think that it has happened about seven times in the past 175 years. When did we last have a balance of payments surplus? We have to be long in the tooth to be able to look back to a balance of payments surplus which really meant anything. The country's whole dilemma has been how best to deal with the changing situation of Great Britain in the world, against the background of two world wars.
  Politicians on either side would be foolish to think that from a little debate like this there could emerge the panacea whicvh has confounded the statesmen of past years. They would be much wiser to address themselves to what this little Bill really tries to do. One hon. Member opposite said that if we did not have the Bill the result would be to take £30 million out of the reserves, and he said that that was my right hon. Friend's reason for reintroducing the measure. He placed that figure against the balance of trade surplus of £65 million over the past three months, did his simple arithmetic and said that accordingly, if we did not introduce the Bill for a second period, instead of being in the black we would have been in the red over the past three months. That kind of stupid thinking is as dangerous to this country as the B.M.A. saying when it wants a salary increase, "We can stop the health service". Anyone with an irresponsible state of mind can do that sort of trick and come to the conclusion that he can hold someone to ransom.
  Hon. Members opposite should have been saying that they are pleased that this country is in the black for the past
  462
  three-month period for the first time. Whatever the circumstances and their political fortunes, they should be willing to be big enough to say that after many years of our trying to bring the country into a state of surplus the trend is now there, and the Government's intention to keep it ticking along in that direction must be good.
  Therefore, it is unwise of them to put down an Amendment such as the one we are discussing. It exposes the Opposition to considerable criticism in the country. The hopefulness of hon. Members opposite is confused with the kind of promises they offer. I said in a Committee debate on another Bill only this week that their promises on taxation and cutting down public expenditure seemed to outbid the Magnificat. Some of the things I have heard in the debate on this Bill seem to outstrip not the Magnificat but the Sermon on the Mount.
  We are dealing particularly with trading relationships, with trying to control the increase in imports. If hon. Members opposite try to get away with the suggestion that we are not dealing commercially fairly with the E.F.T.A. countries, let me tell them that this country's behaviour is a hallmark of good conduct in international trading. Only today I was told that a country receiving aid from the United Kingdom will give a contract in this country only with certain conditions attached.
  Time and time again over the past year, as the Chairman of the Estimates Committee's Sub-Committee on Exports, I have had evidence brought to me of the practices of other countries. Therefore, the Sermon on the Mount philosophy of hon. Members opposite is contradictory. Never in this Chamber should an hon. Member try to place the trading practices of this country on a lower level than those of the rest of the world, though that has happened time and again.
  I am grateful to have had the opportunity to intervene again in our debate on the Bill. I have been interested in the Bill, and I am concerned that this country shall continue to work more and more towards a better and increasing balance of payments surplus. I should be very sorry if the good start the Bill has had does not continue. There needs to be a continuing scrutiny of its effects, certainly on small companies. It is not

  463
  a question of passing a Bill and then waiting to have some reckoning up. There must be a continuing dialogue on it. But hon. Members opposite should for once say to the country that they too are pleased that the Government, with a whole package of measures, have produced a balance of payments surplus which, for the sake of our nation, we all hope will continue.
  Mr. Kenneth Baker: What I find most objectionable in the Clause, which the Amendment does something to mitigate, is that the Government have not so far put forward a case for extending the imports deposits scheme for a day, week or month, let alone a year. That is why we seek in the Amendment to restrict the scheme to a further six months.
  The argument put forward earlier was that the scheme, if it operates in the next year, is a fine economic tool. That was the argument of the hon. Member for Birmingham, Northfield (Mr. Chapman), who referred to it as a sophisticated tool of economic management. But if one does not know the precise effect of an economic tool one should not use it, and the Government do not know. If one asks any Minister, including the two in the Chamber, to what extent the scheme has inhibited imports, they will not give an answer. If one asks, "Why did you choose 40 per cent. instead of 30 or 20 per cent.?", they will not give an answer, because they do not know. They are legislating from ignorance, and that is what sticks in my gullet. To call the scheme a sophisticated economic tool is to stretch credulity to the point of complete naivety. It is not. It is a blunderbuss with very marginal effect on imports. But it has a greater effect on domestic liquidity.
  On Second Reading, the Minister of State said, in effect, that he could not give facts as to why we should have the scheme and asked us to trust the Government's economic judgment. That, after five years, is a bit of a nerve. With this scheme, the Government are groping in a fog and know they are. They have no idea of the economic weather. They are trying to judge it with a sundial set the wrong way round. This means that, whenever the sun comes up, they think that it is going down, and whenever
  464
  it is going down, they think that it is coming up. This is what we have had for the last five years and it is what we have in the Bill.
  The major point of the Amendment is the way company liquidity is being affected by the scheme. It is the most serious point of the debate and is tied up with the time factor with which the Amendment is concerned. The Government are holding about £550 million of British industry's money under the scheme. That is a great deal of money. The November issue of Financial Statistics showed that the liquid assets of United Kingdom commercial and industrial companies over the 12 months between June, 1968, and June, 1969, fell by £80 million. Since June, 1969, they have probably fallen dramatically more. Thus the Government, with this scheme, the corporation tax increase, the S.E.T. increase and the increases in National Insurance contributions levied only this month, are taking out of industry's cash flow £550 million.
  I believe that this is affecting companies in two ways. There is growing evidence that companies are reducing their investment programmes and also growing and disturbing evidence that they are cutting research and development programmes. Research and development is often one of the first casualties in a cash crisis in any company, and I believe that, if we could get the Government to repay to industry this £550 million at the end of six rather than 12 months, it would be a great boon.
  I do not believe that this would have the super inflationary effect which the hon. Member for Ashton-under-Lyne (Mr. Sheldon) argued that it would on Second Reading. It certainly will have nothing like the inflationary effect that the 25 per cent. increase in wages of building workers and the 20 per cent. increase for airline workers will have.
  To emphasise my argument, I give a specific example from the Press. Rolls-Royce, one of our great industrial companies has, I would estimate, a substantial amount of money paid in import deposits to the Government. Perhaps Ministers know how much and will be prepared to tell us. But it must be millions, if not tens of millions of pounds. Yet the company, in its own newspaper, explained to its workers that there is a

  465
  considerable crisis and that basically it is a cash crisis.
  What is extraordinary is that, to get out of this cash crisis, the company is having to go to the Industrial Reorganisation Corporation to borrow money. Thus, on the one hand, the Government, through this scheme, suck money from the company and, on the other, force it to go to the I.R.C. to borrow back its own money. That is something which even Shylock did not think of. It is almost a contravention of the Moneylenders Act, but it is what is happening.
  More and more companies are being placed in this position. I believe that the Chairman of the I.R.C. has sent out a letter offering loans to British industry— the very companies which are having to pay import deposits. He is saying to them, "The Government have taken your money and have not paid a penny to you for it. They are keeping it for six months or a year. However, we will lend you some money." This is financial dishonesty and it is disgraceful that the Government should condone it.
  I hope that the Government will say tonight that, whilst this scheme is going on, the I.R.C. will not offer any loans of any sort to British industry because this is trying to loan back to British industry British industry's own money.
  I hope that I have made the case, which I believe to be very powerful, that the liquidity of companies is now being affected to such an extent that it is not a debating matter any longer. Management and executive meetings throughout the country are cutting research and development plans. One way the Government can help industry to expand in 1970 and 1971 is to withdraw this scheme immediately.
  5.15 p.m.
  Mr. Taverne: When the Customs (Import Deposits) Act was being debated last year, there was a certain amount of schizophrenia among hon. Members opposite. Some of them appeared to be protectionist and others free traders. For different reasons, there has again been a fundamental contradiction in their arguments today. One has contradicted another and, to some extent, the hon. Member for Barkston Ash (Mr. Alison) contradicted himself.
  466
  The hon. Gentleman made two main points. First, he said that the scheme had had no effect on non-exempt categories of goods. Secondly, he said that credit restraint had not been successful, that the scheme had not made credit more difficult to obtain, that, although there may be £400 million tied up at the moment in customs, with £300 million added in the June quarter, the liquidity of companies showed the fatuity of the Government's fiscal and monetary policies.
  I have myself stressed the second factor, but everything the hon. Gentleman said was totally contradicted by other contributions made by his hon. Friends. The hon. Member for Acton (Mr. Kenneth Baker) has just complained of an appalling shortage of liquidity in companies which must be remedied by deposits being paid back. Yet the hon. Member for Barkston Ash says that the scheme has been a total failure and has not affected the liquidity of companies or credit restraint or made credit more difficult to obtain. The two hon. Gentlemen must argue between themselves as to which of them is right.
  Mr. Alison: I will argue with the hon. and learned Gentleman because it is his arguments and not ours which are contradictory. The argument of my hon. Friend the Member for Acton (Mr. Kenneth Baker) is that companies end up by getting the money they want, but that it goes through so many different hands that they have to pay a good deal more for it. In other words, they get it at an inflated cost as a result of the extra middlemen.
  Mr. Taverne: But that was not the argument which was advanced. The hon. Member for Barkston Ash advanced the case that the squeeze has not worked. The hon. Member for Acton argued that the squeeze is working too much. One cannot reconcile those two views.
  Both the hon. Member for South Angus (Mr. Bruce-Gardyne) and the hon. Member for Barkston Ash made the point that it is possible, if we relax other aspects of Government policy, to offset the effect of the scheme. Of course it is. The scheme is not the sole means by which the expansion of credit is controlled, but only one of them. If we relaxed other restraints on credit, this

  467
  could obviously offset the effect of the scheme.
  But, as my hon. Friend the Member for Birmingham, Northfield (Mr. Chapman) explained in a speech which was a complete answer to every point made on the benches opposite, this scheme is part of a package, and plays an important part in that package. It reinforces credit restraint and the question we have to consider is whether it is having a beneficial or harmful effect, which is what the hon. Member for Acton addressed himself to.
  Mr. Kenneth Baker: I am glad that at last we have had from the Government a definition of what the package is intended to do. I understand now that the package is intended to restrain domestic credit. Why, then, is a Government agency going around offering substantial loans to British industry? This must be counter-productive and against the policy of the Government. The contradiction lies in Government policy. On the one hand, they are holding back the liquidity of companies, and on the other, sending the Chairman of the I.R.C. out scattering money on loan.
  Mr. Taverne: I am sorry that the hon. Member for Acton does not understand either the effect of Government policy or the intention of Government policy. What is certainly achieved is restraint of consumption. Of course, this does not mean that the I.R.C. will not continue to play its extremely useful part in encouraging expansion in those sectors of industry which are vital to our balance of payments; this is something entirely separate. But there is certainly an effect on consumption, and there was intended to be an effect on consumption.
  As I outlined at the very start of my speech on Second Reading, the first justification of the continuation of the import deposits scheme is that it is a contribution to the successful policy of credit restraint which has helped to produce the results which we have seen in recent months.
  The hon. Member for Barkston Ash said that the scheme had no effect whatever on the import of goods in the non-exempt category. This was answered by some of his hon. Friends, but I was surprised to find that he answered it himself. He outlined the effects on
  468
  E.F.T.A. and said that E.F.T.A. had naturally expressed concern. He said, "No wonder E.F.T.A. expressed concern". He said that what had happened was that our imports from E.F.T.A. were now higher by only one third as compared with our exports to E.F.T.A. Yet he said that the scheme had had no effect whatever on imports. His hon. Friends said that E.F.T.A. was naturally showing concern because our exports to E.F.T.A. had expanded three times as fast as our imports from E.F.T.A.
  The hon. Gentleman cannot have it both ways. Nor can he reconcile what he said with the view of his hon. Friend the Member for St. Ives (Mr. Nott), who said that the moment the scheme was ended we would see a great surge of imports, imports flowing in in masses.
  Mr. Nott indicated dissent.
  Mr. Taverne: I am exaggerating a bit, but the hon. Member for Barkston Ash must allow me some dramatic effect when there is such an obvious and plain contradiction between everything he said and what his hon. Friends said.
  Mr. Chapman: What the hon. Member for St. Ives (Mr. Nott) said was that nobody denied that the scheme had had an effect on reducing imports in the short term. Those were almost his exact words.
  Mr. Taverne: I must quote him. He said that if the scheme were ended, imports would be sucked in. Those were his words and I took them down verbatim. If imports are to be sucked in when the scheme is ended, that implies that while the scheme is on, it prevents those imports from coming in. But that is a contradiction of what was said by the hon. Member for Barkston Ash.
  Mr. Alison: The hon. and learned Gentleman is having fun with his vast exaggerations. The figures which he has quoted back at me in no way invalidate my argument. They show simply that exports from E.F.T.A. have risen substantially, but that E.F.T.A.'s imports from us have gone up even more and that there is, therefore, a built-in incentive for E.F.T.A. countries to see whether they cannot at any rate try a system of import deposits as the British Government have said that it has such a powerful effect.
  Mr. Taverne: That is not the way in which the hon. Gentleman put it. He said that the E.F.T.A. countries were right to show concern because the scheme had had an adverse effect on their trade with us.
  Let us consider the figures. I have said from the start that it is very difficult to isolate the particular effect of import deposits, and I am sure that hon. Members will recognise this, when it is part of a package of measures including, first, the delayed action effect of devaluation, secondly, the effect of the credit squeeze as a whole, thirdly, the effect of fiscal measures on the restraint of consumption itself, which has also had an effect on imports, and, fourthly, the import deposits scheme. When there are at least four different factors involved, it is clearly impossible to say that one of those factors accounts for £20 million, £40 million or £80 million worth of a reduction of imports.
  The only fair test, and I challenge any hon. Member opposite to give me a fairer lest, is to say—and I repeat that it is difficult to isolate an individual influence—that there have been certain factors working on all imports while the import deposit scheme has worked on only some, so if we compare the rate of increase of imports of those goods which are exempt with the rate of increase of imports of goods subject to the scheme, we shall arrive at some sort of effect. I can see no other way of doing it.
  I put these figures before the Committee very fairly. I do not claim that any figures which one may mention will show an exact influence and hon. Members must draw their own conclusions. However, the figures are not as the hon. Member for Barkston Ash described them, when he said that the difference was as though a boy described himself as being over 11 while another said that he was under 12.
  Before the scheme was imposed, the annual rate of increase of goods covered was more than 13 per cent. and the annual rate for goods not covered was less than 5 per cent. I have described that quite accurately as a rate of nearly three times as much for the former. Since the import deposits scheme has been introduced, that rate has become just over twice, 6½ per cent. compared with 3 per
  470
  cent. That is the only kind of independent test which I can think of, and it suggests that there has been a useful and considerable effect.
  Mr. Alison: The hon. and learned Gentleman has not answered the point which we have been making, which is that the drop in this imbalance should have been very much greater, if his theory is right, taking into account the substantial drop in the rate of growth between the two periods.
  Mr. Taverne: The hon. Gentleman has not followed the argument. First, he has totally understated the rate of growth and, secondly, he has not grasped the fact that if there are certain measures working on all imports, one must look to the distinguishing factors which are working selectively only on imports subject to the scheme. That is the test and the distinction which one must draw. Looking at the total effect of the measures, to which this is a contribution, that is what one would find.
  One does not find, as the hon. Member for St. Ives suggested, a small surplus. He mentioned £66 million in the last quarter. He left out completely what must be current figures and he left out invisibles. Hon. Members opposite are always rightly stressing the enormous importance of invisibles to our balance of trade. Counting invisibles at the rate of £40 million a month, the picture is not one in which there is a small surplus. Counting the last three months' invisibles, we have been running at the rate of about £500 million a year in current surplus. It is perfectly true that one does not want to be dogmatic about progress in future and that is one of the reasons we are keeping the scheme on—because we are cautious. We do not want to make over-dramatic claims for the future.
  Mr. Nott: You want to win the election.
  Mr. Taverne: The hon. Gentleman is obsessed with party politics. He does not for a moment consider reports outside Britain. I will take not a Treasury forecast, but the forecast of O.E.C.D. for 1970. O.E.C.D. is not concerned with winning an election. It is looking at 1970 as a whole and considering the effect on the balance of payments of the current measures. I am not saying

  471
  whether it is wrong, but citing an objective judgment. O.E.C.D. says that it foresees for the United Kingdom in 1970 a balance of payments surplus on current account of some £600 million.
  Mr. Nott: About time, too.
  Mr. Taverne: But some of the hon. Member's hon. Friends were saying that the Chancellor of the Exchequer was now obsessed with the need to have a surplus. We have been perfectly consistent all along and have said that we want to obtain a strong balance of payments surplus for a long and continuing period. There is a packet of policies directed to obtaining that surplus and at the moment those policies look likely to succeed.
  The arguments on the Amendment have been exactly the arguments which were used on Second Reading. As my hon. Friend the Member for The Hartlepools (Mr. Leadbitter) said, nothing new has been said. What we are saying is that the import deposits scheme is part of a package which is working; let us not unwrap the package now.
  Mr. Terence L. Higgins: I am sorry that the Financial Secretary seems to have inherited his predecessor's frivolous approach to some of these arguments. I found his arguments almost as difficult to follow as those of the hon. Member for Birmingham, Northfield (Mr. Chapman). It is not true that anyone on this side of the Committee has ever suggested that it was easy to manage the economy. That is not an accusation which may reasonably be levelled at the Opposition. On the other hand, there is no doubt that all the main economic indicators make it abundantly clear that in an equally difficult situation we managed it better than hon. Members opposite are suggesting.
  [Sir BARNETT JANNER in the Chair]
  5.30 p.m.
  This was brought out very clearly by my hon. Friend the Member for St. Ives (Mr. Nott) who quoted the relevant statistics with regard to unemployment, economic growth, inflation and so on. It is not a simple problem and it is clear that we need to look at this in as sophisticated a manner as possible. Some
  472
  of the questions were simple and we might have expected that we would have received reasonably straightforward answers from the Financial Secretary.
  We want an answer why the Government have changed their mind. The Chancellor said quite clearly the other day that he is now on his most optimistic target figure. If that is so, why do we now have this Bill before us, when it was abundantly clear that he did not intend the scheme to run for more than a year? Secondly, we need to examine the whole question of the reserves, but perhaps that would be more appropriate on Third Reading.
  I am deeply worried by the approach of a number of hon. Gentlemen opposite on Second Reading—and again today by the hon. Member for Northfield—and also by the disregard that they show for our international obligations and the need to encourage greater freedom of trade. On that point I am surprised that the Financial Secretary did not disown the suggestion that this kind of measure might become a permanent part of our economic armoury. It would be very dangerous if that point of view were to spread among our E.F.T.A. partners.
  Regardless of what has been said by hon. Members opposite, the fact is that our E.F.T.A. partners are very worried about the effect that this measure is having. They are worried that it is slowing down the rate of growth which would otherwise have taken place in the imports and exports between the various E.F.T.A. countries. For that reason, I hope that my hon. and right hon. Friends will join me in voting in favour of the Amendment.
  Mr. Chapman: The point that the hon. Member does not seem to realise when he talks about our foreign competitors and our friends in Europe is that they too want to experiment with more sophisticated weapons in controlling the balance of payments problem. All the countries in Europe are not prepared to have "stop-go" cycles that amount to recessions and drastic cuts in international trade through the old measures. They are all preferring one by one to grope forward with these more sophisticated weapons.
  Mr. Higgins: The implication of what the hon. Gentleman has said must mean that these so-called more sophisticated measures are measures which will inevitably lead to a restraint on trade between countries. They will inevitably reduce the total of world trade. There is no country which has more to lose from this kind of policy than the United Kingdom. We therefore believe it is right and proper, while we are against the scheme as a whole, and this will be made even more clear later, that some limitation of the kind which this Amendment imposes is the right approach.
  I return to the quotation of the Chancellor of the Exchequer. When he first mentioned his scheme in the House he said quite clearly:
  "Imports will be reduced directly because of the difficulty and cost of obtaining credit."—[OFFICIAL REPORT, 22nd November, 1968; Vol. 773, c. 1795.]
  That has not proved to be so. We are still without any explanation why the Government should extend this scheme. We believe that it should be limited in the way suggested by the Amendment, or better still, should not be carried forward at all. We shall continue to press that view and I hope my hon. and right hon. Friends will join me in the Division Lobby and vote for the Amendment.
  Question put, That the Amendment be made: —
  The Committee divided: Ayes 160, Noes 200.

  Division No. 12.]

  AYES

  [5.35 p.m.

  Alison, Michael (Barkston Ash)

  Grant-Ferris, Sir Robert

  Page, Graham (Crosby)

  Allason, James (Hemel Hempstead)

  Griffiths, Eldon (Bury St. Edmunds)

  Page, John (Harrow, W.)

  Baker, W. H. K. (Banff)

  Gurden, Harold

  Pardoe, John

  Balniel, Lord

  Hall-Davis, A. G. F.

  Peel, John

  Bell, Ronald

  Hamilton, Michael (Salisbury)

  Percival, Ian

  Bennett, Sir Frederic (Torquay)

  Harrison, Col. Sir Harwood (Eye)

  Pike, Miss Mervyn

  Bennett, Dr. Reginald (Gos. & Fhm)

  Harvey, Sir Arthur Vere

  Pounder, Rafton

  Berry, Hn. Anthony

  Harvie Anderson, Miss

  Price, David (Eastleigh)

  Bessell, Peter

  Hastings, Stephen

  Prior, J. M. L.

  Birch, Rt. Hn. Nigel

  Hawkins, Paul

  Pym, Francis

  Boardman, Tom (Leicester, S.W.)

  Heald, Rt. Hn. Sir Lionel

  Ramsden, Rt. Hn. James

  Body, Richard

  Heath, Rt. Hn. Edward

  Rhys Williams, Sir Brandon

  Boyd-Carpenter, Rt. Hn. John

  Higgins, Terence L.

  Rossi, Hugh (Hornsey)

  Boyle, Rt. Hn. Sir Edward

  Hirst, Geoffrey

  Russell, Sir Ronald

  Brewis, John

  Hogg, Rt. Hn. Quintin

  St. John-Stevas, Norman

  Brornley-Davenport, Lt. -Col. Sir Walter

  Holland, Philip

  Scott-Hopkins, James

  Brown, Sir Edward (Bath)

  Hornby, Richard

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

  Bruce-Gardyne, J.

  Hunt, John

  Silvester, Frederick

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

  Jenkin, Patrick (Woodford)

  Sinclair, Sir George

  Bullus, Sir Eric

  Jennings, J. C. (Burton)

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

  Campbell, IS. (Oldham, W.)

  Johnston, Russell (Inverness)

  Smith, John (London & W'minster)

  Campbell, Gordon (Moray & Nairn)

  Kaberry, Sir Donald

  Stainton, Keith

  Carlisle, Mark

  King, Evelyn (Dorset, S.)

  Stoddart-Scott, Col. Sir M.

  Cary, Sir Robert

  Kitson, Timothy

  Summers, Sir Spencer

  Channon, H. P. G.

  Lancaster, Col. C. G.

  Tapsell, Peter

  Chataway, Christopher

  Lane, David

  Taylor, Sir Charles (Eastbourne)

  Clegg, Walter

  Lawler, Wallace

  Taylor, Frank (Moss Side)

  Cooke, Robert

  Legge-Bourke, Sir Harry

  Thatcher, Mrs. Margaret

  Cordle, John

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

  Thorpe, Rt. Hn. Jeremy

  Corfield, F. V.

  Lubbock, Eric

  Turton, Rt. Hn. R. H.

  Costain, A. P.

  McAdden, Sir Stephen

  van Straubenzee, W. R.

  Craddock, Sir Beresford (Spelthorne)

  MacArthur, Ian

  Vaughan-Morgan, Rt. Hn. Sir John

  Crowder, F. P.

  Mackenzie, Alasdair(Ross & Crom'ty)

  Vickers, Dame Joan

  Cunningham, Sir Knox

  Maclean, Sir Fitzroy

  Waddington, David

  Currie, G. B. H.

  Macleod, Rt. Hn. Iain

  Wainwright, Richard (Colne Valley)

  Dalkeith, Earl of

  McMaster, Stanley

  Walker, Peter (Worcester)

  Dance, James

  McNair-Wilson, Michael

  Walker-Smith, Rt. Hn. Sir Derek

  Dean, Paul

  Maginnis, John E.

  Walters, Dennis

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

  Marples, Rt. Hn. Ernest

  Ward, Christopher (Swindon)

  Dodds-Parker, Douglas

  Marten, Neil

  Ward, Dame Irene

  Drayson, G. B.

  Maudling, Rt. Hn. Reginald

  Weatherill, Bernard

  Eden, Sir John

  Maxwell-Hyslop, R. J.

  Wells, John (Maidstone)

  Elliot, Capt. Walter (Carshalton)

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

  Whitelaw, Rt. Hn. William

  Eyre, Reginald

  Mills, Stratton (Belfast, N.)

  Wiggin, A. W.

  Farr, John

  Mitchell, David (Basingstoke)

  Williams, Donald (Dudley)

  Fisher, Nigel

  Monro, Hector

  Wolrige-Gordon, Patrick

  Fletcher-Cooke, Charles

  Montgomery, Fergus

  Wood, Rt. Hn. Richard

  Fortescue, Tim

  More, Jasper

  Worsley, Marcus

  Foster, Sir John

  Munro-Lucas-Tooth, Sir Hugh

  Wright, Esmond

  Gilmour, Ian (Norfolk, C.)

  Nabarro, Sir Gerald

  Wylie, N. R.

  Glover, Sir Douglas

  Neave, Airey

  Godber, Rt. Hn. J. B.

  Nicholls, Sir Harmar

  TELLERS FOR THE AYES:

  Goodhart, Philip

  Nott, John

  Mr. Humphrey Atkins and

  Gower, Raymond

  Orr-Ewing, Sir Ian

  Mr. Anthony Royle.

  Grant, Anthony

  Osborn, John (Hallam)

  NOES

  Albu, Austen

  Grey, Charles (Durham)

  Mikardo, Ian

  Allaun, Frank (Salford, E.)

  Griffiths, David (Rother Valley)

  Millan, Bruce

  Alldritt, Walter

  Griffiths, Eddie (Brightside)

  Miller, Dr. M. S.

  Armstrong, Ernest

  Hamilton, James (Bothwell)

  Milne, Edward (Blyth)

  Atkins, Ronald (Preston, N.)

  Hamilton, William (Fife, W.)

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

  Atkinson, Norman (Tottenham)

  Hamling, William

  Molloy, William

  Bacon, Rt. Hn. Alice

  Hannan, William

  Morris, Alfred (Wythenshawe)

  Baxter, William

  Harper, Joseph

  Morris, Charles R. (Openshaw)

  Beaney, Alan

  Harrison, Walter (Wakefield)

  Moyle, Roland

  Bence, Cyril

  Haseldine, Norman

  Neal, Harold

  Bennett, James (G'gow, Bridgeton)

  Hattersley, Roy

  Newens, Stan

  Binns, John

  Hazell, Bert

  Norwood, Christopher

  Blackburn, F.

  Henig, Stanley

  Oakes, Gordon

  Blenkinsop, Arthur

  Herbison, Rt. Hn. Margaret

  O'Halloran, Michael

  Boardman, H. (Leigh)

  Hilton, W. S.

  Orbach, Maurice

  Booth, Albert

  Hooley, Frank

  Oswald, Thomas

  Boston, Terence

  Horner, John

  Owen, Will (Morpeth)

  Bottomley, Rt. Hn. Arthur

  Howell, Denis (Small Heath)

  Padley, Walter

  Boyden, James

  Howie, W.

  Page, Derek (King's Lynn)

  Bradley, Tom

  Hoy, Rt. Hn. James

  Pannell, Rt. Hn. Charles

  Brooks, Edwin

  Hughes, Roy (Newport)

  Park, Trevor

  Broughton Sir Alfred

  Hunter, Adam

  Parker, John (Dagenham)

  Pavitt, Laurence

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

  Hynd, John

  Pearson, Arthur (Pontypridd)

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

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

  Pentland, Norman

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

  Jeger, George (Goole)

  Perry, Ernest G. (Battersea, S.)

  Butler, Herbert (Hackney, C.)

  Jenkins, Hugh (Putney)

  Perry, George H. (Nottingham, s.)

  Butler, Mrs. Joyce (Wood Green)

  Jenkins, Rt. Hn. Roy (Stechford)

  Probert, Arthur

  Callaghan, Rt. Hn. James

  Johnson, Carol (Lewisham, S.)

  Randall, Harry

  Cant, R. B.

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

  Rankin, John

  Carter-Jones, Lewis

  Jones, Dan (Burnley)

  Richard, Ivor

  Chapman, Donald

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

  Roberts, Albert (Normanton)

  Coleman, Donald

  Jones, J. Idwal (Wrexham)

  Roberts, Rt. Hn. Goronwy

  Concannon, J. D.

  Jones, T. Alec (Rhondda, West)

  Roberts, Gwilym (Bedfordshire, S.)

  Conlan, Bernard

  Judd, Frank

  Robertson, John (Paisley)

  Dalyell, Tam

  Kelley, Richard

  Rodgers, William (Stockton)

  Darling, Rt. Hn. George

  Kerr, Russell (Feltham)

  Ross, Rt. Hn. William

  Davies, G. Elfed (Rhondda, E.)

  Lawson, George

  Ryan, John

  Davies, Rt. Hn. Harold (Leek)

  Leadbitter, Ted

  Shaw, Arnold (Ilford, S.)

  Davies, S. O. (Merthyr)

  Lee, Rt. Hn. Frederick (Newton)

  Silverman, Julius

  Dempsey, James

  Lestor, Miss Joan

  Skeffington, Arthur

  Dewar, Donald

  Lewis, Arthur (W. Ham, N.)

  Slater, Joseph

  Dickens, James

  Lewis, Ron (Carlisle)

  Small, William

  Doig, Peter

  Dunwoody Mrs. Gwyneth (Exeter)

  Lipton, Marcus

  Spriggs, Leslie

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

  Lomas, Kenneth

  Strauss, Rt. Hn. G. R.

  Eadie, Alex

  Loughlin, Charles

  Swain, Thomas

  Edwards, Robert (Bilston)

  Luard, Evan

  Taverne, Dick

  Edwards, William (Merioneth)

  Lyon, Alexander W. (York)

  Thomas, Rt. Hn. George

  English, Michael

  Lyons, Edward (Bradford, E.)

  Tinn, James

  Ennals, David

  Mabon, Dr. J. Dickson

  Tuck, Raphael

  Ensor, David

  Urwin, T. W.

  Ensor, David

  McBride, Neil

  Varley, Eric G.

  Evans, Fred (Caerphilly)

  McCann, John

  Watkins, David (Consett)

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

  MacColl, James

  Watkins, Tudor (Brecon & Radnor)

  Faulds, Andrew

  McElhone, Frank

  Wellbeloved, James

  Fernyhough, E.

  McGuire, Michael

  Wells, William (Walsall, N.)

  Finch, Harold

  Mackenzie, Gregor (Rutherglen)

  White, Mrs. Eirene

  Fletcher, Rt. Hn. Sir Eric (Islington, E.)

  Mackie, John

  Wilkins, W. A.

  Fletcher, Ted (Darlington)

  Mackintosh, John P.

  Wiley, Rt. Hn. Frederick

  Foot, Michael (Ebbw Vale)

  Maclennan, Robert

  Williams, Clifford (Abertillery)

  Ford, Ben

  McMillan, Tom (Glasgow, C.)

  Willis, Rt. Hn. George

  Forrester, John

  McNamara, J. Kevin

  Wilson, Rt. Hn. Harold (Huyton)

  Fowler, Gerry

  MacPherson, Malcolm

  Winnick, David

  Freeson, Reginald

  Mahon, Simon (Bootle)

  Woodburn, Rt. Hn. A.

  Galpern, Sir Myer

  Mallalieu, E. L. (Brigg)

  Woof, Robert

  Gardner, Tony

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

  Ginsburg, David

  Mapp, Charles

  TELLERS FOR THE NOES:

  Golding, John

  Marks, Kenneth

  Mr. R. F. H. Dobson and

  Gregory, Arnold

  Mellish, Rt. Hn. Robert

  Mr. Alan Fitch.

  5.45 p.m.
  Mr. Higgins: I beg to move Amendment No. 3, in page 1, line 21, leave out 'forty' and insert 'ten'.
  The Temporary Chairman (Sir Barnett Janner): With this Amendment we shall discuss the following Amendments:
  476
  No. 2, page 1, line 20, after 'cent.', insert:
  'of the value of the goods'.
  No. 4, in page 1, line 21, leave out 'forty per cent.' and insert:
  'at the following percentages of the value of the goods:

  As from 5th December, 1969 to 4th February, 1970

  40%

  As from 5th February, 1970 to 4th April, 1970

  30%

  As from 5th April, 1970 to 4th June, 1970

  20%

  As from 5th June, 1970 to 4th December, 1970

  10%"

  Mr. Higgins: The purpose of the Amendment is to reduce the rate of import deposits from 40 per cent. to 10 per cent. Just as we have had no explanation from the Government why the Bill has been introduced for one year in contrast to their original statements, so we have had no explanation why they have fixed the rate at 40 per cent. This afternoon we had an extraordinary spectacle when the President of the Board of Trade was answering Questions. My hon. Friend the Member for Acton (Mr. Kenneth Baker), in Question No. 22, asked
  "the President of the Board of Trade by how much he estimates that imports will increase when the rate of import deposits is reduced from 50 to 40 per cent."
  It became apparent that Ministers could give no estimate at all. Indeed, in subsequent exchanges it became apparent that the Board of Trade had not even attempted to estimate what the effect would be on the level of imports.
  It is true that the figure will be substantially influenced by the fact that, because they believed what the Chancellor of the Exchequer said last year—that the Bill would come to an end at the end of the year—many people have held back from importing in recent months. Following the renewal of the scheme, if the Bill is approved, we shall probably see some bulge in imports. But the fact that there has been this anticipation of the end of the scheme, and then disappointment, inevitably clouds the facts of the case That is common ground.
  Nevertheless, the Government should have made some estimate both of the extent of the anticipation and of the extent to which it will subsequently be counteracted, as well as some estimate of what the effects of various changes in the rates were likely to be. Various items, such as foodstuffs and raw materials, are exempt, but from what the Chancellor said it is clear that the duty is likely to affect the imports of goods which are subject to the import deposits scheme. That being so, surely some estimate should have been made of the demands for the various products subject
  478
  to the scheme and, consequently, how much a reduction of the rate from 50 per cent. to 40 per cent. was likely to affect the level of imports. As far as we have been able to establish, no such studies have even been attempted. Will the Minister of State tell us whether any such studies have been made and, if they have, will he indicate the effect which a change of this kind will have on the level of imports?
  It seems to us that we ought to put down this Amendment, and I will explain why we have done so. Throughout last year and this year we have maintained that this scheme is objectionable in principle. That continues to be our view. An Amendment seeking to reduce the rate might in some ways be thought to condone the Government's action. That is not the case. We thought it right that the House should have an opportunity to examine the effect of a 40 per cent. rate against that of a somewhat lower rate in specific cases.
  In many ways the Bill embodies the various approaches which the Government have adopted and which are objectionable in legislation. One of the most objectionable features, to which I have referred previously, is the way in which the Government draw Money Resolutions. They do so in such a way as to curtail debate on subjects which are legitimate subjects of discussion. There has been no other case in which the Money Resolution has been drawn as tightly as in this case. I referred to the point when we debated the Ways and Means Resolution on 10th November.
  That Resolution stated that the original import deposits scheme
  "may remain in force, subject to the like exemptions and reliefs as were provided for"
  in the original Act. I stress
  "the like exemptions and reliefs"
  because businessmen and others do not, I think, understand the impact of a Money Resolution on the way in which Amendments can be framed. The beating of the Government on Money Resolutions and Amendments has been something that we have got into the habit of doing ever since the selective employment tax debates.
  This, however, is quite the tightest Resolution that we have had. Without consulting experts on the subject, I was

  479
  unable to find any way in which to get Amendments in order on the Paper, and, therefore, debatable, concerning specific items which, in our view, should not be subject to the import deposits scheme.
  I thought originally that the expression
  "the like exemptions and reliefs"
  might be interpreted as being "similar exceptions and reliefs" but, unfortunately, I understand that the legal approach is somewhat different and the alleged commonsense approach is that the word means, not similar, but the same.
  That is difficult to understand. Whereas the Minister of State and I might be alike in the sense that we are both human beings, it would be a wrong use of syllogisms to suggest that we were the same human beings. That, however, is apparently how these matters work. As a result, it is only on an Amendment of the kind that I have moved that we can legitimately bring to the attention of the House of Commons and the Government specific cases which should be considered concerning the impact of the import deposits scheme.
  The second point, which, again, is typical of the way in which the Government have approached various pieces of legislation of this kind in recent years, concerns the use of a classification, produced for a quite different purpose, as the basis for making exemptions concerning import deposits, S.E.T., and so on. This inevitably means that the classification is precise but quite inappropriate for the new use to which it has been put. As a result of this, a number of items are subject to the import deposits scheme which on any reckoning should clearly have been excluded.
  The main exemptions which were mentioned last year, and which are still subject to the full rate of duty, are food and raw materials. The main problem concerning these two items arose in two ways. First, we found that a number of items which obviously should have been excluded, even on the definition of food and raw materials, were subject to the import deposits scheme because they were hidden somewhere in the midst of the complicated classification which the Government incorporated in the original Bill.
  480
  Last week, on Second Reading, there were two references to this in particular. One was by my hon. Friend the Member for Macclesfield (Sir A. V. Harvey), who, at col. 910, referred to the use of calcium carbide and pointed out that this product was subject to the import deposits scheme even though it was entirely imported and there was no possibility of any import substitution scheme being evolved in the meantime. That inevitably meant that the effect on the importation of this item was nil and the effect on our industrial cost was quite considerable.
  A similar point was made by the right hon. Member for Sheffield, Hillsborough (Mr. Darling). I am sorry not to see the right hon. Gentleman in his place, but it is abundantly clear why he is not to be seen. Although he put forward convincing arguments why, for example, silicon carbide should be excluded from the import deposits scheme because of its great importance to Sheffield in cutlery, hand tools, special steels and the abrasives industry, to which he referred at col. 906 on 17th November. Although, like my hon. Friend the Member for Macclesfield, the right hon. Gentleman would like to have seen the Bill amended, he was unable to do so—that, presumably, is why he is not here—because it was not possible to get Amendments within the rules of order. Clearly, however, there is a case for exempting those items.
  The fact is that the Government have been too lazy to go into these matters and make the adjustments which, in the light of the last year's experience, they should have made. Meanwhile, however, the effect on our industrial costs has been contrary to the national interest and may positively mean that we do not sell exports as well as we otherwise would.
  There is a specific point about which I wish to ask the Minister. When we debated the original Import Deposits Bill in Committee last year, the Government, perhaps persuaded by the arguments from this side or realising that they had made a mistake, put down a substantial Amendment with regard to the use of imported goods which were subsequently exported. The object, apparently, was to give discretion to enable goods which were imported and then used in exports to be exempted from the charge.

  481
  I should like the Minister to tell us to what extent that provision has been used during the last year and to what extent the deposits which have been paid have been refunded immediately rather than, probably, at the time when the goods were eventually exported, with the result that those who use these imported goods have borne the burden of the interest-free loan in the same way as anyone else. In view of the attention which the House gave this matter last year, I hope that the Minister can give us a clear answer. Those are the main points which I should like to raise in that context.
  I want now to take by way of example three specific cases which I mentioned briefly in passing on Second Reading and to go into the matter in a little more detail. There appears to have emerged an absurd paradox in our institution arrangements concerning imports. The House will know that from time to time, for various reasons which have been specified in legislation and Statutory Instruments, the Board of Trade grants temporary exemptions from import duty. Usually, such proposals are put forward in the Board of Trade Journal and subsequently the Government take the necessary steps to ensure that exemptions are given for those items.
  I want to take up one item in particular because it seems to be of interest. It is is referred to in the Board of Trade Journal of 29th October this year and it concerns cold reduced steel plates of iron and steel, rectangular, in coils of a width exceeding 500 mm. I understand that the Government have accepted that these items cannot be produced in this country in sufficient quantity to meet the demands of people here and, therefore, that they no longer impose the relevant duty, so that those who make household consumer durables, for example, can use the materials and not be subject to the additional cost of import duty.
  As far as I can establish, however, those items and others like them, which are exempt temporarily from ifport duty, are still having to bear the import deposit. If that is so, it seems to me to be absurdly inconsistent. I may be wrong on this. It may be that the Government have already taken steps to ensure that that does not happen because, clearly, it is likely to inhibit the production of goods for export. I consider it to be
  482
  right to raise this matter and I hope that the Minister will undertake that if what I have said is correct and there is an inconsistency as against the position concerning temporary exemption from import duty, the same exemptions, of the same temporary nature, will be extended to the import deposits scheme.
  6.0 p.m.
  I turn now to my second example and this is the effect of the import deposits scheme on plywood. I mention this not so much as an item of the kind I was describing just now which has got lost somewhere in this vast industrial classification used for the scheme, but rather because the exemptions which were given last year only extend on the one hand to food and on the other hand to raw materials of semi-manufactured products defined in an arbitrary way by the Government. Those not exempt consequently bear the brunt of the import deposits scheme and these are another case, it seems to us, where one ought to reduce the rate of duty, or preferably, as we on this side have consistently argued, eliminate it altogether, because quite a number of these items—and I take plywood as an example—are effectually the raw materials which are used and of which there is no real domestic production which can hope to fill the gap.
  Therefore, the effect of the import deposits scheme is to raise costs and to have no perceptible effect on imports. I understand that less than 4 per cent. of the country's total plywood requirement is actually produced domestically; the remaining 96 per cent. is imported. Therefore, I think it is quite clear that the net effect of putting the import deposits scheme on these items must be to raise our costs and not to have any perceptible effect on imports, though that is the declared objective of the Government's scheme.
  If this is so the first point which one needs to notice is the very arbitrary way in which the thing is defined, because quite clearly it is a very fine line indeed to draw a distinction between plywood on the one hand and ordinary timber on the other, because these two are very close substitutes. Timber imported and used for packing cases is actually exempt, whereas plywood is not exempt. I find it difficult to find any possible rationale for

  483
  this. A number of items made of plywood—for example, packing cases, but of one kind and another—are used in exports. Therefore, the result must be to put up export costs and to have an adverse effect on our export performance. I do not suggest that this is an item which will affect the fundamental health of the British economy in a significant way such as the whole economic policy, but it is a fact none the less that the imposition of this scheme in this silly way does have an effect of discouraging exports and putting up the cost of living, rather than the reverse effect. Therefore, it is right and proper that we should look at this this afternoon and consider whether the Government ought to do something about this kind of case.
  Similarly, with the export of motor cars, the export of completely knocked down components of motor cars, putting the import duty on plywood is likely to have an effect. It is true, of course, that it affects home building, home construction. So I hope that there again we shall have an explanation from the Minister about this item, which I take just as an example of one of the things which really cannot be easily produced in this country and where expansion of production is very difficult and clearly would not be worth while if the scheme is to go on for two or three years, let alone only for the forthcoming year.
  The third example which I ought to take is the imports of paper and paper board. This, again, is an item in the packaging industry. I am not sure that this is one on which I can reasonably speak with expertise, but certainly in the packaging industry we have to import an enormous amount of various kinds of paper and these, again, are subject to import duty, cannot be readily produced in this country, and which may enter into exports. As I have said, I do not believe that the exemptions given last year for imports of raw materials for manufactures which go into exports have been effective. The arbitrary way in which the distinction is made is very odd indeed. Presumably, paper is reckoned a semi-manufacture and is subject to import duty, but if one imported paper pulp, as I understand it, this would be exempt. Yet presumably pulp is every bit as much a manufacture in its way. The difference
  484
  is between trees and pulp and between pulp and paper. Yet the line is drawn by the Government in this arbitrary way and in a way which is clearly working against the objectives of the Government's policy and the Government's Bill and seems to us to be a very silly way of going about it.
  As I say, the only conclusion one can really reach from the way the Government have drawn the Money Resolution and the way they have put forward this Bill is that we must go through these items item by item, to see which sort should be excluded in the light of experience.
  I come finally to the question of importers. I dealt at some length with this on Second Reading and I shall not now refer to it at great length, but the fact is that importers are carrying out a useful function in this country, although there was some antagonism towards them from the other side on Second Reading. It seems to us that the effect on importers is likely to result in a number of them going out of business even though they are performing a perfectly reasonable function. This is another example of the penny slot machines which we debated on the Finance Bill. This is another example of the way the Government go in for annihilation taxes. Measures of this kind which the Government impose and which put people out of business ought not to be taken as something we normally accept.
  So, for all these reasons, I think the Committee should accept this Amendment. As I say, this in no way reduces out total antagonism to the Bill as such, but it seems to me that if we examine just the few examples which I have quoted it is enough to show that for a number of these at any rate the rate ought to be reduced. We would hope that for quite a number it should be eliminated altogether, but, failing that, the rate should be reduced on those items which quite clearly ought not to be in cluded in the scope of the Bill.
  Mr. Cyril Bence: I would agree with the hon. Gentleman the Member for Worthing (Mr. Higgins) on the point about the packaging industry. The industry in this country, and, indeed, in every country of the world, is one of the great growth industries of the modern age Housewives

  485
  everywhere are demanding and getting domestic products of all kinds packaged in all sorts of ways very attractive to them. Packaging is a great selling property of a product, but it is becoming a very costly one. It is the same, as the hon. Gentleman mentioned, with the export of motor cars and what is called C.K.D.—completely knocked down. A great deal of component parts under C.K.D. are packed in corrugated paper and fibre board.
  Much of this is not manufactured in this country. It is quite uneconomic to import pulp and convert it to paper rather than have it converted to paper in the timber-growing countries. Paper is an essential raw material in the whole packaging industry, and packaging enters into 90 per cent. of exports. There are several firms in this country making packaging and although packaging cannot be called an export product other people buy it from these firms, to pack the things which they export.
  The import deposits scheme is driving up their cost. The cost of packaging some products is as high as that of the products inside the packages. We are trying to keep down the price of the product, but we are pushing up the price of the package in which product is put. If we could find a substitute for imported paper for making packages I would not be asking my hon. Friend to examine this matter. I can enumerate a whole string of products where the same argument applies. I have not been through such a string of products, but I do happen to know about these two, corrugated paper and paper packaging.
  The motor industry is compelled to export C.K.D. because many importing firms are demanding that a proportion of products from the importing country shall be included in the assembled motor car. Nothing should be allowed to increase the cost of packaging and so increase the cost of exporting the product.
  I recognise that, by eliminating one anomaly, another might be created, but I ask my hon. Friend to see whether it is possible to get over the anomalies. The hon. Member for Worthing has a very serious point in trying to deal with paper and plywood, the raw materials of packaging.
  Mr. Tom Boardman (Leicester, Southwest): The hon. Member for Dunbartonshire, East (Mr. Bence) is right in supporting the criticisms made by my hon. Friend the Member for Worthing (Mr. Higgins) of the effect of the Bill. No doubt there might be some anomalies, but I believe that they are capable of being overcome.
  In the pessimistic belief that Amendment No. 3 might not be accepted by the Government, I have tabled an Amendment in a different form, the effect of which would be a phasing out of the import deposits scheme, and I have endeavoured to meet all the reasons given by the Financial Secretary on Second Reading for the retention of the scheme. The purpose of Amendment No. 4 is to phase out import deposits over a period, the main taper coming within the first six months, leaving 10 per cent. for the remainder of the year.
  The Financial Secretary has told us why he cannot do away altogether with the scheme, and I would be out of order if I were to reopen that debate, but the reasons he gave are material to the Amendment. The Financial Secretary, on Second Reading, promised that this time the deposit scheme will be temporary. The Paymaster-General last time said that they would be temporary and this has been repeated from time to time, but I am prepared for the purpose of this debate to give the Government the benefit of our accumulated doubts.
  The Financial Secretary gave three reasons for renewing the import deposits, all of which are relevant to the Amendment. The first was that it was necessary to control credit expansion. He said that it was a useful incentive to companies to get their hands on moneys earned by exports. I believe that exactly the reverse effect has occurred.
  Those of us who have from time to time been intimately involved in exports and export finance know that it is usually a slow process to get one's hands on money from the export market. There are, of course, facilities for export credit, but the delay between getting in the raw material and receiving the cash on a sale to the export market is much greater than with sales to the home market, and the first leg of his argument is, therefore, complete nonsense.

  487
  The second reason given by the Financial Secretary under the main heading of controlling credit expansion was that the continuation of the squeeze would do no more harm than good. That, at best, is a neutral term. He coupled that with a denial that there would be any surge of bankruptcies or liquidations. I ask the Minister of State to reflect on that, and on the trends which are becoming increasingly apparent to those closely involved with industry who know that many small companies are faced with great cash problems. I only hope that the Financial Secretary is right in his optimism that there will not be a spate o. bankruptcies and liquidations, but the signs are that the trend is there.
  6.15 p.m.
  The Financial Secretary accepted that the import deposits scheme slowed down industrial investment. Hon. and right hon. Members who either heard or have read what my hon. Friend the Member for Harwich (Mr. Ridsdale) said in the Adjournment debate on Friday will know about the rate of our industrial investment compared with that of competing countries such as Japan and Germany, and will recognise how relevant is this point to the Amendment.
  Amendment No. 4 produces a gradual easing of the control and prevents the flood of money back, yet it permits investment plans to be made. If the Amendment were accepted, industry would know that each month it would be getting back a bit more of its money, that after six months it would receive back all bar 10 per cent. and that eventually it would receive it all.
  The second argument put forward by the Financial Secretary on Second Reading was that it was necessary to avoid the monthly outflow of reserves over the next six months and to phase out the payments more gradually. The Amendment does just that. It drops the rate of import deposits by 10 per cent. each two months for the next six months and then retains, albeit reluctantly, the minimum deterrent of 10 per cent. for the final six months. This precisely meets the fear of the Financial Secretary that cutting off the import deposits would mean a flood of money back at a time when the country could not stand it.
  The third point made by the Financial Secretary about which I wish to make
  488
  some criticism is that the scheme had a useful direct effect on imports. The figures given by the Financial Secretary were not very fairly stated. In referring to the comparison between the rate of growth of exempt and non-exempt imports as a justification for the import deposit scheme having had effect, he quoted figures, and then came to the conclusion that the difference between the rate of increase in non-exempt and exempt goods had dropped from nearly three times to just over twice.
  Criticism has been made in an earlier debate today of those figures and they are misleading. The change, as near as I can calculate it, is about one-thirteenth. That is a distortion of the figure. I accept that the Financial Secretary's arithmetic may not be very good, but the figures were given on 17th November and the same argument has been repeated today.
  The Financial Secretary in reply on another issue to my hon. Friend the Member for St. Ives (Mr. Nott) said that he had exaggerated a bit. I am sure that it was accepted as a lighthearted remark, but the Financial Secretary cannot bandy figures about on such a vital matter and either exaggerate a bit or produce a comparison which appears to give a different picture from that disclosed by an arithmetical analysis of the figure.
  The Minister of State, Treasury (Mr. William Rodgers): I am sure that the hon. Gentleman would not wish to mislead the Committee about what my hon. and learned Friend said. Will he not agree that the figures were given fully in HANSARD on 17th November and are there for everybody to see? Therefore, the Financial Secretary has in no way sought to mislead anybody. I hope that the hon. Gentleman is not suggesting that the figures which appear in c. 878 are inaccurate.
  Mr. Boardman: The figures themselves are not inaccurate. I was referring to the way in which they were presented as a justification for the effect of the import deposits scheme. To say that it had resulted in a difference between the rate of increase in non-exempted and that for exempted goods amounting to a drop of from three times to just over twice presents a picture—I accept it may not be

  489
  intentional—which does not bear mathematical examination since on my calculations the difference is about one-thirteenth.
  I am glad to see the Financial Secretary now back in the Committee since I would not like to have made my criticisms in his absence. I regret that he was not able to be here when I was making my comments on his presentation of the figures.
  A distortion of the figures does not help the argument. The hon. and learned Gentleman accepted that there were many differences in other respects to account for the trend. He justified his argument by saying that he took the only comparison which ignored all the other factors and which was common both to exempted and non-exempted goods. This is not in fact the case. The effect of devaluation was not constant, neither was the effect of world prices.
  Exempted goods are largely concerned with foodstuffs and the like, whereas non-exempted goods are mainly industrial products. The pattern of price movement between them has been very different. The Financial Secretary will be aware that the rate of growth of the G.N.P. between the two periods showed a drop of 25 per cent. Its effect would be mainly on non-exempted goods. Marginally, the difference presented by his arithmetical calculation could be accounted for by a large variety of factors which have nothing to do with the import deposits scheme.
  The argument against the Amendment that the scheme could not be dropped because it would increase the money coming back into the economy will be valid on any future occasion, if this Government are then in office. I therefore urge them to consider the Amendment which provides for a tapering off, if they are not prepared to go the whole way with a substantial reduction in the import deposits scheme.
  To a Government taxes are like drugs or cigarettes to an addict. They are always something which one will give up tomorrow. I fear that if we do not have a phasing out of the imports scheme, in the same way as a smoker may discipline himself to cut down by a quarter, then by half and then drop the habit altogether, then we shall find that at this
  490
  time next year, if we have the misfortune to be faced with the same Government, precisely the same arguments will be put forward.
  If the encouraging balance of trade figures are maintained, and if the achievement is as the Government claim it to be, then they should now commit themselves to get rid of this heavy burden on industry. Industry has managed to carry this burden for a year at great cost both to investment and to its forward planning. Industry has carried it for long enough. I hope that it will not be required to do so for a further 12 months since it is entitled to know when it will begin to get back its money. And I would stress that it is industry's money.
  [Mr. SYDNEY IRVING in the Chair]
  Mr. John Page: The Government are lucky that the hon. Member for Accrington (Mr. Arthur Davidson) has not earlier than this afternoon had an opportunity to introduce his Private Member's Bill to regulate inertia selling. This Bill is a sophisticated example of inertia selling, on the same basis as the innocent housewife who is persuaded to fill in a form asking for a monthly magazine or encyclopaedia to be sent to her and, unless she takes the trouble to prevent it, it keeps on coming to her.
  There was a row over this legislation last year on 3rd and 4th December, but the Bill went through. The present Bill, in a couple of quick new Clauses, provides for the scheme to be continued for a further 12 months. I support Amendment No. 3, and also what was said by the hon. Member for Leicester, Southwest (Mr. Tom Boardman) on his Amendment No. 2. However, I feel that Amendment No. 4, in which my name is joined with his, should be more attractive to the Government. It gives them a great opportunity to tail off the scheme so that people will not be embarrassed suddenly by the fact that the Government will live up to their promises and drop the scheme. Amendment No. 4 provides for a gradual tailing off, rather than a sudden moment of relaxation which might, the Government are afraid, have bad effects.
  The Bill has almost come to be accepted as a fairly permanent part of our way of life. I wish to raise the point

  491
  of remissions which are allowed to exporters. There are serious doubts in the minds of many importers of goods who sell through one, two or three stages of processing to a manufacturer who ultimately may re-export.
  This doubt is underlined by the serious fact that, as I was informed only this afternoon, the OFFICIAL REPORT containing the Second Reading debate on this Bill is still not available from the Stationery Office. I have not checked that fact myself, but I have been informed of it by the director of an important company who wished to inform himself of the detail of that debate.
  Will the Minister confirm that if these Amendments are not accepted, and the scheme is extended for a further 12 months, there will be no change in the system of rebates on import deposits in respect of imports later re-exported as covered by Schedule 2 of the 1968 Act? Let me spell this out for the benefit of the Minister of State. At present, if a processer of goods, say, can inform the importer that he expects to include in export 20 per cent. of the imported materials, when there is a 50 per cent. deposit and, as it were, a global 20 per cent. export, a remission of 20 per cent. of that 50 per cent. deposit is allowed, which means that only a 40 per cent. deposit need be made by the original importer.
  What will now be the position of that same company, assuming the same 20 per cent. export potentiality? Does the system remain the same? Two companies to which I have spoken have assumed that, as they were previously paying 20 per cent. of the 50 per cent., they will now pay 10 per cent. of the 40 per cent. I see that the Minister of State nods his head: I hope that this assumption is right. My own sums have led me to a rather different conclusion, but confirmation of what I have just said will be extremely helpful to the business community.
  In passing, I should like the Minister of State to hand a bouquet to the staff of the Customs and Excise for the way in which they have operated this scheme. I have taken a little trouble to inquire how the system of returning deposits is going, and I have been told that the
  492
  returned deposit reaches the depositing company on the very day of the expiry of the six months' period, and sometimes even on the day before. That is an excellent performance. It is most helpful to depositors to be absolutely certain, when considering cash flow—and deposits may involve very large figures—that they will get their deposit back not later than the appropriate date.
  I should like, as a second rose in the bouquet, to congratulate the Customs and Excise on the flexible manner in which local inspectors have assessed the export content of goods which are, perhaps, being processed by more than one manufacturer before they are ultimately exported, and have allowed the original importer a global remission on his initial deposit. At half-past Twelve on the morning of 4th December last year, the then Financial Secretary, discussing the then Bill, said that the extra staff and extra administration required by the Customs and Excise would be negligible; and the way in which the scheme has been operated so far confirms that view.
  There is now evidence that the influence of Parkinson is entering into the attitude of the Customs and Excise. It was right that when the scheme started, the Customs and Excise staff should have been informed, "This is a temporary Measure. It will last for 12 months. Use a bit of rule of thumb, and give quick and sensible rulings on the remission of deposits." It was right, knowing that it was to last for only 12 months, the Department should not have bothered to go too deeply into the evidence required, and do too much paperwork. But evidence now brought before me shows that a lot more time, energy, paperwork and consideration are apparently being expended by the Customs and Excise and this, in turn, means a lot more paperwork by the companies involved.
  I re-emphasise a point made by my hon. Friend the Member for Worthing. How much continuing consideration are the Government, the Board of Trade and the Treasury giving to adding to the exemptions list goods not previously exempted but which surely now demand it? I have here a copy of the Board of Trade Journal of 29th October listing various types of tin plate and cold rolled steel

  493
  sheet. The leading explanatory paragraph states:
  "The Board of Trade are considering applications for the temporary exemption from import duty of materials listed below on the grounds that these materials are not made in this country or the Commonwealth, or the supply available from these sources is not substantial having regard to the existing United Kingdom demand."
  In cases where the steel industry—
  The Chairman: Order. Perhaps the hon. Member will explain how what he is saying is related to the rates under discussion. I find it difficult to follow him.
  Mr. Page: I relate it to the fact that by my Amendment I would try to reduce the rates to 10 per cent. People now forced to import goods which previously could have been supplied in this country are very much inconvenienced if they have to put down a 40 per cent. deposit. If, however, it were a 10 per cent. deposit the inconvenience and expense to the company would be greatly reduced.
  I also wished to make an en passant reference on behalf of an industry in which I have a personal interest, the synthetic rubber industry. I hope that on this Amendment consideration can be given to the removal from the list of imported synthetic rubber on the ground that—
  The Chairman: Order. I have no doubt that now the hon. Member is out of Order.
  Mr. Page: I was about to finish my sentence by saying that reclaimed synthetic rubber is already exempt and that this seems to be an anomaly.
  I hope that if the Government cannot go all the way with Worthing they will at least go with Leicester and Harrow and make a sensible phasing out of the present scheme.
  Mr. William Rodgers: It is very unlikely that I shall be able to go with Leicester and Harrow in this respect or with all the hon. Members opposite who have spoken in this debate.
  The hon. Member for Worthing (Mr. Higgins) started by emphasising one of the contradictions which we have again seen this afternoon when he predicted some bulge in exports when the scheme eventually came to an end, whereas his hon. Friend the Member for Barkston
  494
  Ash (Mr. Alison) spoke of counter-productive effects of the scheme, by which we understood that it was likely that imports had been increased over the period in which it operated rather than been reduced. He went on to complain about the Money Resolution and got on to the substantive points.
  Mr. Higgins: There is absolutely no contradiction here. Clearly, the effect of the scheme may be this or that over a year, but just before the scheme is expected to end action might be taken in anticipation of that happening and there might be a second effect when that turns out to be wrong.
  6.45 p.m.
  Mr. Rodgers: I found the hon. Member unconvincing. The suggestion that the scheme has been an impetus to the growth of imports and that there will be a further impetus when the scheme comes to an end might be right, but it is unconvincing. The hon. Member spoke of the effect of re-exports and the case for exemption of a number of commodities on varying grounds.
  I was grateful to the hon. Member for Harrow, West (Mr. John Page) for congratulating the Customs and Excise on the flexible way in which it has operated the scheme. The whole Committee will agree that, despite the misgivings a year ago and the reservations there still are about the principle or the rate that we are discussing, the scheme has worked well because of the efforts of Customs and Excise. I am sorry that the hon. Member now feels that there is some hardening of the arteries. That is not the intention. Once the Bill has been through the House, if there has been any change in mood the same first-class service will be available thereafter.
  So far as I can, within the rules of order, I wish to reply to everything that has been said this afternoon about commodities which will be subject to the present level of deposits and about which it might be argued there ought to be exemptions. Of course, there are cases which can be made. In the past, we have very carefully considered representations, and we shall continue to do so. Inevitably, if more anomalies are not to be created we have to walk warily. If there were a large range of concessions,

  495
  the effect of the Bill would be substantially reduced. This may be the wish of some hon. Members, but, having decided what we think the scheme ought to be, it would make nonsense of it if that happened and the purpose would not be achieved.
  When my right hon. Friend announced the continuation of the scheme he made clear both what we had achieved and what we thought we might expect from the reduced 40 per cent. He took the view, which we have restated in discussions on Second Reading, that the scheme had a useful effect in a number of different fields. I ask the hon. Member for Leicester, South-West (Mr. Tom Boardman) to look again at what my hon. and learned Friend the Financial Secretary said on Second Reading. He had no wish to mislead the House and I do not believe that the detailed figures do so. They show that there has been a change in the rate of growth between exempt and non-exempt goods. The conclusion we have drawn, although, of course, it is not possible to quantify it, is that the scheme has had some desirable effects in this direction as well as in others.
  As the Chancellor said, it is his view that at present, while it is desirable to retain the scheme, it is possible to reduce the effect. That is why the figure of 40 per cent. was chosen.
  Mr. Tom Boardman: I do not accuse the Financial Secretary of bad faith, but I think that the hon. Gentleman will agree that the amount was one-thirteenth and the Chancellor's advocacy presented it in a rather different light.
  Mr. Rodgers: If the hon. Member thinks that, I cannot argue with him further. The figures should be looked at. If the scheme were as small as one-thirteenth, which I do not accept, this makes a significant difference given the overall needs of the occasion. We are not saying, and we did not say on Second Reading, that continuing the scheme would make a very large difference, but that in all the circumstances, despite the fact that the trend on balance of payments is in the right direction, retaining the scheme at the level of 40 per cent. is about right. That is our view and for
  496
  that reason I hope that the Committee will reject the Amendment.
  Mr. John Page: Possibly the Minister was not able to give an off-the-cuff answer to my question about the exact percentages of rebate. Would he be kind enough to write to me later or in some other way publicise this so that it may be made available to the business community, which seriously needs this information?
  Mr. Rodgers: I am sorry that I overlooked that point, which is a substantial and very fair one. The system remains the same. Whereas it was 20 per cent. and 50 per cent. it is now 20 per cent. and 40 per cent.
  Mr. Higgins: We must press the Minister of State on points we made because they were perfectly in order and there is no reason why he could not give us a reply. It may be that my hon. Friend the Member for Barkston Ash (Mr. Alison) may wish to make more general comments on what the hon. Gentleman said as to the principle. We quoted some specific examples—calcium carbide, plywood and packaging materials, and a particular one of steel.
  I asked whether, if a thing is exempt from import duty or is not exempt from import deposit, to what extent the provisions of last year's measure with regard to the position of imported goods which were subsequently exported had actually been employed by the Customs and Excise. I asked whether or not, if that were so, the import deposit had still to be paid by the people using those goods for exports and thereby making an interest-free loan to the Government.
  On all of these points it is not unreasonable for the Committee to expect specific answers. It is unreasonable for the Minister to brush the case off in general terms. If there are any arguments as to why these items should not be exempted, other than the fact that the Government have tabled a very tight Money Resolution and are not prepared to take the trouble to examine the items on their merits, let the Minister state the arguments against doing so. He should not seek completely to avoid the issue.
  Our point is that, on any understanding of what the scheme is supposed to be about, not to exempt these goods must be

  497
  contrary to the country's interests, because the scheme is not doing anything other than inhibiting exports rather than encouraging them. There are a number of specific examples which should be covered. There are a number of points of general principle on which the Minister should give answers.
  Therefore, as we are in Commitee, I hope that the Minister will respond and will deal both with the points of principle and with the specific examples.
  Mr. William Rodgers: I had thought that I had dealt with the points of general principle. This is not the time to argue the case for or against individual exemptions. I said that we had considered all representations and that we would do so in future, but bearing in mind the necessity of preserving a scheme which made sense and which had achieved its purpose it was not our view that the items mentioned today and mentioned on Second Reading were ones for which we could consider exemptions.
  I do not think that it would be possible, least of all on this Amendment, to discuss in detail all the separate arguments for and against each of the exemptions which have been mentioned. I give the hon. Gentleman the assurance, if he wishes it again, that we retain in a sense an open mind, in that we are prepared to consider cases which are put to us and to weigh in the balance whether it is right and proper in the circumstances to make a further exemption.
  The hon. Gentleman asked about the question of import duty. This is a separate matter. There would be further complications, and there would be dangers of our appearing to move into a protectionist position, if we related import deposits and goods which were exempt or non-exempt directly to the use of import duties. The hon. Gentleman asked also about the question of re-exports.
  Mr. Higgins: If an import is exempted from import duty on the ground that it cannot be produced in Britain and is necessary for Britain, it is clearly a non-sense at the same time to impose an import deposit. The two things are clearly on the same footing. There is absolutely no reason why, if it is exempted in one case, it should not be exempted in the other.
  Mr. Rodgers: As I said—I do not want to keep on repeating this—the Bill is not designed as a protective measure. It has a different purpose. If we had this parallel between the use of import duties and an import deposits scheme, there would be legitimate international objection to using the scheme in this way as a protectionist Measure.
  Sir Harmar Nicholls Sir Harmar Nicholls (Peterborough) rose—
  Mr. Rodgers: As I am attempting to reply to what the hon. Member for Worthing (Mr. Higgins) asked me earlier, I think that I should have a further go at it before attempting to deal with the further questions of hon. Gentlemen.
  The hon. Member for Worthing asked about the portion of goods exempted under the re-export provisions. It is 20 per cent. As the hon. Member for Harrow, West (Mr. John Page) had in mind, there is every evidence that the scheme has operated effectively and very fairly in this respect. I am not aware of any criticisms which it has not been possible to meet.
  Sir Harmar Nicholls: The Minister of State said that the deposit scheme was not intended as a protection. Surely it was intended to discourage imports. If that was not the reason for its introduction, I should like to know what the reason was. Why is it desirable to discourage something which we cannot produce and which we want? It is silly and a waste of time to say that the scheme does not mean protection. The whole object of the scheme was to discourage. Does the Minister of State agree that what he is doing is discouraging the import of things that we need because we cannot produce them?
  Several Hon. Members Several Hon. Members rose—
  The Chairman: I do not want to discourage discussion, but we are getting on to the principle of the Bill rather than speaking to the Amendment.
  Sir Harmar Nicholls: Mr. Irving, in view of the statement made by the Minister, I think that I am entitled to an answer. I asked a question arising from the Minster's statement. If the Minister's statement was in order, my question is bound to be in order.
  Mr. Rodgers: The hon. Gentleman has not listened to the discussion fully otherwise he would know, as he should know also from the debate on Second Reading, that there were three principal purposes for the Bill, as my hon. and learned Friend said. Even though one of them related to checking the growth of imports, it would still remain the case that the purpose, intention and result of the Bill in that respect would not be the same as a protective measure as it is normally understood.
  Mr. Nott: Are we not talking about the opposite of a protective measure? My hon. Friend the Member for Worthing (Mr. Higgins) spoke about precisely the opposite. He asked: why remove the duty on nickel sulphate and certain steel products and leave the import deposit on? We are arguing the opposite of protective duties.
  Mr. Rodgers: The hon. Gentleman has not fully grasped the sophistication of the argument. My argument was that, if goods were exempted because they were not subject to import duty, we should get into the position where non-exception involved protection.
  Mr. Alison: We have received a very bitty and unsatisfactory answer from the Minister of State, who has made confusion worse confounded by his series of half answers and non-answers to the questions put by my hon. Friend the Member for Worthing (Mr. Higgins) and others of my hon. Friends. One of the most significant omissions was the non-answer to the request by my hon. Friend the Member for Worthing for the Minister to quantify, not in financial terms, because that is obvious, but in terms of effect, the result of reducing the rate of import deposits from 50 to 40 per cent. The Minister made no attempt to answer that.
  For the Government to come to the Committee in the matter of import deposits, whose effect in any case is agreed to be highly marginal and perhaps absolutely imperceptible and undefinable, and propose a reduction by 10 per cent., a result which is entirely unquantifiable, is a piece of hollow window-dressing which amounts almost to the frivolous. It is meant to show people that the
  500
  Government are ready to show willing, even though the amount cannot be calculated and is imperceptible.
  If the Government have a disposition towards reducing the rate at which import deposits are to be charged, they have got to accept a figure which makes some attempt to bite at this question and not put forward this little 10 per cent. reduction, which will have a totally imperceptible effect.
  If the Government will not accept the full scale of the major Amendment, we must ask them to think seriously as an alternative about the graduated rate of reduction which my hon. Friend the Member for Leicester, South-West (Mr. Tom Boardman) put forward and which is a logical proposal.
  One of our great objections to the Bill in its present form is that when it was intended that it should run for only 12 months, the Government took the trouble in Committee to see whether they could make some modifications in the Bill, namely, the exemption of certain goods which were going to be affected by export. They at least took the trouble to write into the Bill some rational and logical exemptions. Since they are asking for a second wind of an equal length, why did they not bring forward a Bill so that we could isolate the imports which were inelastic and which were coming in in the same volume as before?
  7.0 p.m.
  The Chairman: The hon. Member is going wide of the Amendment. It may be that the debate has covered this field before, but it is wide of the Amendment.
  Mr. Alison: The only way in which we can persuade the Government to make amends for the unsatisfactory way in which the Bill has been brought forward, without any attempt to write in some of the provisos which existed in the original Measure, is by proposing a reduction of the rate—
  Mr. Taverne: Surely the hon. Gentleman appreciates that there are exactly the same provisos in the previous measure.
  Mr. Alison: What I am suggesting is that the Bill should have had its Money Resolution drawn in such a way that it was possible to make amendments

  501
  parallel to the amendments which it was possible to make in the Act's first year of run. Obviously, as a result of 12 months' experience there are categories, such as the inelastic categories to which my hon. Friend the Member for Worthing has referred, which should have come up for reconsideration by way of exemption. Since the Bill has come to us in a way in which we cannot make the amendment, the only reasonable alternative is a reduction in the rate of duty on a scale
  which might have some chance of effect—that is to say, from 40 per cent. to 10 per cent.
  If the Government will not make such a reduction I can only ask my hon. Friends to divide in favour of the Amendment.
  Question put, That the Amendment be made: —
  The Committee divided: Ayes 128, Noes 183.

  Division No. 13.]

  AYES

  [7.1 p.m.

  Alison, Michael (Barkston Ash)

  Hamilton, Michael (Salisbury)

  Page, John (Harrow, W.)

  Allason, James (Hemel Hempstead)

  Harrison, Brian (Maldon)

  Pardoe, John

  Baker, W. H. K. (Banff)

  Hastings, Stephen

  Peel, John

  Balniel, Lord

  Hawkins, Paul

  Percival, Ian

  Bennett, dr. Reginald (Gos. & Fhm)

  Heald, Rt. Hn. Sir Lionel

  Pike, Miss Mervyn

  Bessell, Peter

  Heseltine, Michael

  Pounder, Rafton

  Biffen, Jhon

  Higgins, Terence L.

  Prior, J. M. L.

  Boardman Tom (Leicester, S.W.)

  Hill, J. E. B.

  Pym, Francis

  Body, Richard

  Hirst, Geoffrey

  Ramsden, Rt. Hn. James

  Boyd-Carpenter, Rt. Hn. John

  Holland, Philip

  Rees-Davies, W. R.

  Boyle, Rt. Hn. Sir Edward

  Hornby, Richard

  Rhys Williams, Sir Brandon

  Brown, Sir Edward (Bath)

  Hunt, John

  Rodgers, Sir John (Sevenoaks)

  Bruce-Gardyne, J.

  Jenkin, Patrick (Woodford)

  Rossi, Hugh (Hornsey)

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

  Jennings, J. C. (Burton)

  Royle, Anthony

  Bullus, Sir Eric

  Johnston, Russell (Inverness)

  Russell, Sir Ronald

  Campbell, B. (Oldham, W.)

  King, Evelyn (Dorset, S.)

  St. John-Stevas, Norman

  Campbell, Gordon (Moray & Nairn)

  Lancaster, Col. C. G.

  Scott-Hopkins, James

  Carlisle, Mark

  Lane, David

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

  Cary, Sir Robert

  Legge-Bourke, Sir Harry

  Silvester, Frederick

  Chataway, Christopher

  Lubbock, Eric

  Sinclair, Sir George

  Clegg, Walter

  McAdden, Sir Stephen

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

  Cooke, Robert

  MacArthur, Ian

  Smith, John (London & W'minster)

  Corfield, F. V.

  Mackenzie, Alasdair (Ross & Crom'ty)

  Stainton, Keith

  Costain, A. P.

  Maclean, Sir Fitzroy

  Stoddart-Scott, Col. Sir M.

  Crowder, r. P.

  Macleod, Rt. Hn. Iain

  Summers, Sir Spencer

  Cunningham, Sir Knox

  McNair-Wilson, Michael

  Taylor, Sir Charles (Eastbourne)

  Currie, G. B. H.

  Maddan, Martin

  Taylor, Frank (Moss Side)

  Dalkeith, Earl of

  Maginnis, John E.

  Tilney, John

  Dance, James

  Maxwell-Hyslop, R. J.

  Waddington, David

  Dean, Paul

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

  Walker, Peter (Worcester)

  Dodds-Parker, Douglas

  Mills, Stratton (Belfast, N.)

  Walker-Smith, Rt. Hn. Sir Derek

  Eden, Sir John

  Miscampbell, Norman

  Ward, Christopher (Swindon)

  Elliot, Capt. Walter (Carshalton)

  Mitchell, David (Basingstoke)

  Ward, Dame Irene

  Eyre, Reginald

  Monro, Hector

  Wells, John (Maidstone)

  Farr, John

  Montgomery, Fergus

  Whitelaw, Rt. Hn. William

  Fortescue, Tim

  More, Jasper

  Wiggin, A. W.

  Glover, Sir Douglas

  Mott-Radclyffe, Sir Charles

  Williams, Donald (Dudley)

  Goodj\hart, Philip

  Munro-Lucas-Tooth, Sir Hugh

  Wolrige-Gordon, Patrick

  Gower, Raymond

  Nabarro, Sir Gerald

  Worsley, Marcus

  Grant, Anthony

  Neave, Airey

  Wylie, N. R.

  Grant-Ferris, Sir Robert

  Nicholls, Sir Harmar

  Griffiths, Eldon (Bury St. Edmunds)

  Nott, John

  TELLERS FOR THE AYES:

  Gurden, Harold

  Orr-Ewing, Sir Ian

  Mr. Humphrey Atkins and

  Hall-Davis, A. G. F.

  Page, Graham (Crosby)

  Mr. Timothy Kitson.

  NOES

  Albu, Austen

  Boyden, James

  Davies, Ednyfed Hudson (Conway)

  Allaun, Frank (Salford, E.)

  Bradley, Tom

  Davies, G. Elfed (Rhondda, E.)

  Armstrong Ernest

  Broughton, Sir Alfred

  Davies, Rt. Hn. Harold (Leek)

  Atkinson, Norman (Tottenham)

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

  Davies, S. O. (Merthyr)

  Bacon, Rt. Hn. Alice

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

  Dempsey, James

  Baxter, William

  Butler, Herbert (Hackney, C.)

  Dewar, Donald

  Beaney, Alan

  Butler, Mrs. Joyce (Wood Green)

  Doig, Peter

  Bence, Cyril

  Cant, R. B.

  Dunnett, Jack

  Bennett, James (G'gow, Bridgeton)

  Carmichael, Neil

  Dunwoody, Mrs. Gwyneth (Exeter)

  Binns, John

  Carter-Jones, Lewis

  Eadie, Alex

  Blackburn, F.

  Chapman, Donald

  Edwards, Robert (Bilston)

  Blenkinsop, Arthur

  Coleman, Donald

  Ennals, David

  Boardman, H. (Leigh)

  Concannon, J. D.

  Ensor, David

  Booth, Albert

  Dalyell, Tam

  Evans, Fred (Caerphilly)

  Boston, Terence

  Darling, Rt. Hn. George

  Fernyhough, E.

  Bottomley, Rt. Hn. Arthur

  Davidson, Arthur (Accrington)

  Finch, Harold

  Fitch, Alan (Wigan)

  Lawson, George

  Panned, Rt. Hn. Charles

  Fletcher, Raymond (Iikeston)

  Leadbitter, Ted

  Parker, John (Dagenham)

  Fletcher, Ted (Darlington)

  Lee, Rt. Hn. Jennie (Cannock)

  Pavitt, Laurence

  Foot, Michael (Ebbw Vale)

  Lee, John (Reading)

  Pearson, Arthur (Pontypridd)

  Ford, Ben

  Lestor, Miss Joan

  Pentland, Norman

  Forrester, John

  Lewis, Arthur (W. Ham, N.)

  Perry, Ernest G. (Battersea, S.)

  Fowler, Gerry

  Lewis, Ron (Carlisle)

  Perry, George H. (Nottingham, s.)

  Freeson, Reginald

  Lomas, Kenneth

  Price, Thomas (Westhoughton)

  Galpern, Sir Myer

  Loughlin, Charles

  Probert, Arthur

  Gardner, Tony

  Lyons, Edward (Bradford, E.)

  Rankin, John

  Golding, John

  Mabon, Dr. J. Dickson

  Richard, Ivor

  Gregory, Arnold

  McBride, Neil

  Roberts, Rt. Hn. Goronwy

  Grey, Charles (Durham)

  McCann, John

  Roberts, Gwilym (Bedfordshire, S.)

  Griffiths, David (Rother Valley)

  MacColl, James

  Rodgers, William (Stockton)

  Griffiths, Eddie (Brightside)

  MacDermot, Niall

  Ross, Rt. Hn. William

  Hamilton, James (Bothwell)

  McElhone, Frank

  Ryan, John

  Hamilton, William (Fife, W.)

  McGuire, Michael

  Shaw, Arnold (Ilford, S.)

  Hamling, William

  Mackenzie, Gregor (Rutherglen)

  Silverman, Julius

  Hannan, William

  Mackie, John

  Slater, Joseph

  Harper, Joseph

  Maclennan, Robert

  Small, William

  Harrison, Walter (Wakefield)

  McMillan, Tom (Glasgow, C.)

  Spriggs, Leslie

  Haseldine, Norman

  McNamara, J. Kevin

  Steele, Thomas (Dunbartonshire, W.)

  Hattersley, Roy

  MacPherson, Malcolm

  Swain, Thomas

  Hazell, Bert

  Mahon, Simon (Bootle)

  Taverne, Dick

  Henig, Stanley

  Mallalieu, E. L. (Brigg)

  Thomas, Rt. Hn. George

  Herbison, Rt. Hn. Margaret

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

  Tinn, James

  Hilton, W. S.

  Mapp, Charles

  Tuck, Raphael

  Hooley, Frank

  Marks, Kenneth

  Varley, Eric G.

  Horner, John

  Mellish, Rt. Hn. Robert

  Wainwright, Edwin (Dearne Valley)

  Howell, Denis (Small Heath)

  Millan, Bruce

  Walker, Harold (Doncaster)

  Howie, W.

  Miller, Dr. M. S.

  Watkins, David (Consett)

  Hoy, Rt. Hn. James

  Milne, Edward (Blyth)

  Watkins, Tudor (Brecon & Radnor)

  Huckfield, Leslie

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

  Weitzman, David

  Hughes, Roy (Newport)

  Molloy, William

  Well beloved, James

  Hunter, Adam

  Morris, Alfred (Wythenshawe)

  Wells, William (Walsall, N.)

  Jay, Rt. Hn. Douglas

  Morris, Charles R. (Openshaw)

  Wilkins, W. A.

  Morris, John (Aberavon)

  Willey, Rt. Hn. Frederick

  Jeger, George (Goole)

  Moyle, Roland

  Williams, Clifford (Abertillery)

  Jenkins, Hugh (Putney)

  Neal, Harold

  Willis, Rt. Hn. George

  Jenkins, Rt. Hn. Roy (Stechford)

  Newens, Stan

  Wilson, Rt. Hn. Harold (Huyton)

  Jones, Dan (Burnley)

  Oakes, Gordon

  Winnick, David

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

  O'Halloran, Michael

  Woodburn, Rt. Hn. A.

  Jones, J. Idwal (Wrexham)

  Orbach, Maurice

  Woof, Robert

  Jones, T. Alec (Rhondda, West)

  Oswald, Thomas

  Judd, Frank

  Owen, Will (Morpeth)

  TELLERS FOR THE NOES:

  Kelley, Richard

  Padley, Walter

  Mr. R. F. H. Dobson and

  Kerr, Russell (Feltham)

  Page, Derek (King's Lynn)

  Mr. Ioan L. Evans.

  The CHAIRMAN, being of the opinion that the principle of the Clause and any matters arising thereon had been adequately discussed in the course of debate on the Amendments proposed thereto, forthwith put the Question, pursuant to Standing Order No. 47 (Debate on Clause or Schedule standing part), That the Clause stand part of the Bill.
  Question agreed to.
  Clause I ordered to stand part of the Bill.
  Clause 2 ordered to stand part of the Bill.
  Bill reported, without Amendment.
  7.11 p.m.
  Mr. Taverne: I beg to move, That the Bill be now read the Third time.
  In Committee there was some repetition of arguments that we had heard earlier. I do not intend to go over the ground a third time, but shall make three short points.
  504
  First, there has been a slight lack of enthusiasm in pressing the opposition to this Measure. I am not casting any reflection on the quality of the speeches from the benches opposite. But if it will have a devastating effect on small companies, as the Opposition as a whole apparently thought, one would have expected larger numbers of hon. Members to take part in the onslaught against it.
  Secondly, the hon. Member for Worthing (Mr. Higgins) asked whether I could make it clear that I do not necessarily hold the same view about the duration of the Measure as my hon. Friend the Member for Birmingham, Northfield (Mr. Chapman). My hon. Friend made an excellent speech, but on that point I was not entirely with him. If he had been allowed to move that the Bill should be extended for four years, I would have felt bound to oppose that Amendment.
  Mr. Speaker: Order. The hon. and learned Gentleman can discuss only what is in the Bill.
  Mr. Taverne: I stressed on Second Reading that the Bill was temporary, but some Press reports at the time seemed to exaggerate the effect of some of what I said A headline in one paper suggested that I foresaw the early end of import deposits. It is important to get this point clear. Therefore, I repeat what I said at the beginning of our Second Reading debate, which I think is of some importance and would have thought puts the matter beyond doubt:
  "I am not seeking by any hint or suggestion to indicate when or how or whether it may be possible to modify or terminate the scheme before that date."—[OFFICIAL REPORT, 17th November, 1969; Vol. 791, c. 871–2.]
  "That date" was 5th December, 1970.
  Thirdly, I was asked by the hon. Member for Worthing, and, I believe, by the hon. Member for Barkston Ash (Mr. Alison) why there had been a change of mind since May, or since last year. The Letter of Intent of 22nd May simply stated that it was the Government's policy to abolish the import deposits scheme as soon as the balance of payments allowed. That did not say anything about a specific date. It was true that when the Measure was introduced last year we did not expect that it would be renewed. But as the end of the period came near we had to look at it again and decide whether we should allow it to run down or seek to renew it. We decided that it was safer, common sense, and more consistent with overall policy, to renew it.
  It is true that there has perhaps been a change of emphasis in the arguments. That point has been made against us, and I am ready to concede it. We still use the three arguments mentioned last year, although we put a slightly different emphasis on them. It is not simply a question of disliking the withdrawal symptoms, as the hon. Member for St. Ives (Mr. Nott) suggested. He drew a parallel with "pot". Whatever his knowledge of the import deposits scheme, he did not show a profound knowledge of "pot", which does not in itself involve withdrawal symptoms. It is not the withdrawal symptoms about which we are concerned. The emphasis may have been changed, but the three basic arguments which were mentioned last year are still valid: hence the Bill.
  7.15 p.m.
  Mr. Higgins: The Financial Secretary has suggested that there is a lack of enthusiasm in the opposition to the Bill, and the Minister of State, in winding up the debate on Second Reading, also suggested that perhaps we were not enthusiastic about that opposition. Nothing could be further from the truth.
  Our feeling throughout has been that on the point of principle the Bill is very objectionable. I think that the reason that suggestion came into the Minister of State's speech was largely that the first part of it seemed to be an Oxford Union speech for all occasions, and I can only assume that that part happened to be in his Oxford Union speech for all occasions.
  Mr. William Rodgers: I never spoke at the Oxford Union. Has the hon. Gentleman noted that there is precisely one hon. Member on his back benches, which does not suggest great enthusiasm or opposition?
  Mr. Higgins: I might also draw attention to the number of speeches that there have been from the hon. Gentleman's side of the House.
  The debate has been severely inhibited, as I tried to point out on the last few Amendments, by the way in which the Money Resolution has deliberately been drawn very tightly. That is why we have had not had the number of Amendments raising constituency questions that we had last year. This is deplorable, because a number of constituencies and industries are affected, and the fact that the Government are not prepared to face up to criticism of this kind is no excuse. I think that that is the main reason why, in the earlier stages this afternoon, we did not have the kind of debates we had last year.
  The Government would be grossly mistaken if they supposed that because that was so, and because their tactic has been successful in this sense, there is not, nevertheless, very strong feeling on the subject among small businessmen, importers and those who use imported raw materials. Therefore, for reasons which I shall explain later, I think that we shall find that the opposition to the Bill grows as the year progresses, even though at present it may not be

  507
  articulated very clearly because of the rules of order.
  The three main arguments advanced by the Treasury in favour of the Bill require a little more analysis than we have given them so far. I do not think that this is to be repetitious; it is a highly complex subject, and it is necessary to go into it in reasonable detail.
  The priorities the Government mentioned last year for the Measure— restricting imports first and restricting credit second—have been reversed this year. The emphasis has been much more on the credit restriction than on the restriction of imports, and we have also had the additional point mentioned by the Financial Secretary on Second Reading of the effect on the reserves. Therefore, it is right to go into some of the arguments discussed, in as much as they affect the Bill as it stands, which is what we are now concerned with.
  With regard to the credit policy, it is clear that the Government are taking very strong and powerful measures. I have never been against the use of monetary policy, provided that it is used sensibly. If the Government had listened to what we said earlier we should never have got into a position of the money supply being increased at a tremendous rate until quite recently. We accept that the scheme may be a useful tool, but there is grave danger, in that at present we are having a switch-round of the money supply, and the Bill adds to its impact, which is unprecedented in this country or any country, making allowances for the size of the total economy. We do not know what the effect of such a change in the money supply will be, because we have no precedent. Therefore, for this reason as well, we have doubts about the Bill.
  The other point which arises here is that we do not know what the length of the lag is as far as the impact of monetary policy is concerned. It may well be that the lag is such that the big change round we have seen recently in money supply will have a traumatic effect in the coming months. But these things are complicated and difficult to foresee. Nevertheless, we are in uncharted waters here and that is another reason for our doubts.
  508
  I suggested on Second Reading that one of the reasons for the Bill was that the Government were worried about the effect of wage inflation because they had set the pace in the public sector. Nothing I have read since gives me any cause for less alarm.
  Mr. Speaker: Order. The hon. Gentleman must resist the temptation to make a Second Reading speech in a Third Reading debate.
  Mr. Higgins: I am seeking to do that, Mr. Speaker. Indeed, have been trying hard for some time.
  The Bill as it stands is designed to have an impact on credit and one would expect this to come into conflict with increasing wage claims. The latest is the one announced in the Financial Times today of 20 per cent. for airline staff. This is quite inconsistent with the Government's incomes policy and is only the latest example. We therefore have this conflict between credit restraint, of which the Bill forms part, and wage inflation, and we shall find bankruptcies arising this winter of the kind we have complained about and are likely to see a squeeze on importers. That being so, either we have this sort of situation or prices must go up, so that we should be back to the old spiral and the Bill will have failed in its purpose.
  On Second Reading, the hon. and learned Gentleman suggested that we should support the Bill and its effect on credit. He has had to persuade us, first, that the policy of credit restraint is helping economic recovery and that failure to apply it would do more harm than good. But he has to make a third point and it is one which he has not yet advanced, even now. He has to suggest that credit restraint of the kind produced by the Bill is preferable to any other measure which might produce the same degree of credit restraint. But the Government are in some difficulties because they have been unable to give us some estimate of how much effect on credit restraint this scheme has had.
  Mr. Taverne: I was specific on Second Reading about that. Just before the passage to which the hon. Gentleman has referred, I cited the degree of money which would not be going back now— £90 to £100 million down to £20 million—because of the scheme. I said that

  509
  this had a direct effect on credit, and it is quantified.
  Mr. Higgins: I accept the point, but I have a qualification to add. If that is so, the hon. and learned Gentleman must make the point, if his case is to succeed, that this is the right way of doing it rather than by any other proposal. As we have pointed out consistently, the fact is that this Measure has a number of other objectionable features which will effectively invalidate it as a means of achieving price and credit restraint. The Government are taking many other measures in this sector. We do not accept this as the only possible method, or that it is necessary, because of technical factors such as uncertainty of monetary policy and the time lags involved.
  The Bill is objectionable in principle, particularly with regard to our E.F.T.A. partners. It has brought out a number of protectionist elements opposite, despite the hon. and learned Gentleman's statement that it was not intended to encourage protectionism elsewhere. I am sure that that is right, but the danger of this kind of thing and of extending it further is something which the Government should be aware of.
  The argument for the scheme has changed a little between last year and this. This year, we had a third reason. We were given as reasons not merely credit restraint or import restraint but also the question of the effect on the reserves. In that context, this is surprising because, on Second Reading last year, the then Financial Secretary, speaking of the effect of the Bill on the reserves, said:
  "To the extent that borrowing from abroad does occur, there will be a marginal advantage to the reserves, which is not a bad thing."—[OFFICIAL REPORT, 28th November 1968; Vol. 774, c. 753.]
  This was a little inconsistent with his other statements at the same time about the importance of not financing the balance of payments from hot money.
  The Minister has stressed that in a number of debates in the House. Yet the fact is that the effect of the Act and the effect of this Bill will be effectively to bring into this country money which clearly the Government recognise as hot. Indeed, one of the main reasons for the Bill is that the Government are worried
  510
  that, if they end the scheme, this money will flow out of the country again.
  Earlier, we had some discussion of the size of the current trade surplus, the level of invisible earnings, and so on. We welcome the improvement that has taken place both in invisible earnings and in current trade surpluses, but, clearly, the Government—and this is an overwhelming consideration in their mind—are still not in a position to take off this scheme and face the loss of reserves which they believe would follow.
  My personal view is that, if that hot money is here and circumstances continue to improve, there is a case anyway probably for getting rid of it. On the other hand, if the situation is likely to get worse—as we all hope that it will not—even so, one would have thought, on the argument of the former Financial Secretary, that this was a dangerous thing to have happening, because it means a constant repetition of the Bill and the Government never finding themselves in the position of being able to take the scheme off. This is the worrying factor.
  So our over all feeling is that the Bill is objectionable, that the Measure was originally one we should not have supported, and that we should not support its continuance. It is right, therefore, that we should oppose it on Third Reading because we believe that it will not lead to a significant improvement in our economic situation. It may, indeed, both in the fairly close future and certainly in the long run, have an adverse rather than a favourable effect on the economy. For all these reasons, I hope that my right hon. and hon. Friends will join me in voting against the Bill.
  Mr. Nott: When the Ways and Means Resolution for the 1968 Act was introduced just over a year ago, I think I made one of the first speeches against the Measure. I feel that I may now make one of the last speeches against this scheme before, I hope, it is repealed by a new Tory Government. This country cannot afford to indulge in measures which in any way restrict the further liberalisation of world trade. The hon. and learned Gentleman may be a protectionist but I believe that this country has everything to gain from freer trade, since we are a major trading nation. These arguments were understood and

  511
  advanced and supported by the former Financial Secretary.
  7.30 p.m.
  I hope that the present Financial Secretary, with his training in the law, will, in future debates on financial affairs, not misquote hon. Members on this side of the House in support of his arguments. I take two examples of comments he made earlier today in discussion of this Bill. I never said—and I have been to check this in the OFFICIAL REPORT—that imports would be sucked in if the scheme were ended. When I used the term "sucked in", I was referring specifically to what would happen when the brakes were taken off the economy generally if we had full capacity at the time. It was specifically in relation to capacity that I referred to imports and their effect upon the balance of payments.
  He also commented on remarks I made a year ago, when he spoke in the Second Reading debate, and said that I had said that it would move productive capacity from exporting into domestic production. The hon. and learned Gentleman said that in fact there had been no disruption of trade and that exports had soared and that in other words my forecast had been inaccurate. What I said on that occasion was that the scheme would
  "have immediate beneficial effects on the balance of payments—I do not doubt that—it will have highly adverse medium and long-term effects on the economy …"—[OFFICIAL REPORT, 26th November, 1968; Vol. 774, c. 208.]
  I hope that the hon. and learned Gentleman will not continue to attribute to hon. Members on this side of the House comments which they never made in order that he may knock them down. When he was Minister of State, his colleagues released him from his cage only to make comments on important matters such as the administration of the Decimal Currency Board. Now that he has moved up the Treasury ladder, I hope that he will keep to the same precise and detailed comments about hon. Members' speeches which his predecessor made.
  I have never denied that the scheme will have some marginal effect on imports; it clearly has had. There may be slight differences of opinion among my hon. Friends about its precise effect on imports. As the Financial Secretary said,
  512
  it is extremely difficult to quantify. My belief is that the effect on imports is marginal. But its major effect, quite different from that which the Government intended, has been on credit restraint.
  Its effect has been strange. Many importers have been able to finance their stocks by foreign short-term borrowing and to that extent importers have managed entirely to evade the Government's credit restrictions. But domestic producers who have not been substantial importers, and may have been substantial exporters, have been subject to the full rigours of the credit squeeze and have not been able to finance their stocks by foreign borrowing. For this reason, I contend that the scheme could have been deleterious, and not beneficial even in the short term, although I recognise that it has had some marginal effect on imports.
  My major objection to this type of scheme is that in the long run it must transfer capacity from export production to domestic production. If a measure of this sort remains in operation, what will happen is that the cost of importing will be higher and capacity will be taken up by British manufacturers producing goods which were previously imported. In my view some spare capacity should be kept available for exports in order to achieve what is the intention of us all, an exportled boom. Once we start restricting imports by this type of Measure, that spare capacity is taken up for domestic production in order to meet the demand for goods of the type previously coming from overseas. Its net effect will not be beneficial to our payments in spite of its restrictions upon world trade.
  The major effect has been to increase the country's short-term borrowing from overseas by enabling borrowing abroad to finance the stocks of certain importers. As I said in Committee, once again there is another problem which the country will have to face in the medium term. We will have to repay what my hon. Friend the Member for Worthing (Mr. Higgins) described as hot money. I do not know that I would describe it as that, but it is money borrowed to finance British stocks and it will have to be repaid.
  It is all very well for the Government to take these measures which help them in the very short and immediate term

  513
  with the balance of payments, but it is high time that they showed more concern for the medium- and long-term and fundamental effects on the economy of this type of measure. We depend on more capacity and we need more capacity and more investment. We need greater liberalisation of world trade.
  The whole of the import deposits scheme has been most damaging to the
  country. It has helped the Government's policy of credit restraint marginally and I accept that it may have marginally cut imports, but it has put round our necks further problems which, in six months or a year's time, when the scheme ends, some Government will have to face.
  Question put:—
  The House divided: Ayes 172, Noes 123.

  Division No. 14.]

  AYES

  [7.37 p.m.

  Albu, Austen

  Gardner, Tony

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

  Allaun, Frank (Salford, E.)

  Golding, John

  Molloy, William

  Atkins, Ronald (Preston, N.)

  Gregory, Arnold

  Morris, Alfred (Wythenshawe)

  Atkinson, Norman (Tottenham)

  Grey, Charles (Durham)

  Morris, Charles R. (Openshaw)

  Bacon, Rt. Hn. Alice

  Griffiths, David (Rother Valley)

  Morris, John (Aberavon)

  Baxter, William

  Griffiths, Eddie (Brightside)

  Moyle, Roland

  Beaney, Alan

  Hamilton, James (Bothwell)

  Neal, Harold

  Bence, Cyril

  Hamilton, William (Fife, W.)

  Newens, Stan

  Bennett, James (G'gow, Bridgeton)

  Hannan, William

  Norwood, Christopher

  Binns, John

  Harper, Joseph

  Oakes, Gordon

  Blackburn, F.

  Harrison, Walter (Wakefield)

  O'Halloran, Michael

  Boardman, H. (Leigh)

  Haseldine, Norman

  Orbach, Maurice

  Booth, Albert

  Hazell, Bert

  Oswald, Thomas

  Boston, Terence

  Herbison, Rt. Hn. Margaret

  Owen, Will (Morpeth)

  Bottomley, Rt. Hn. Arthur

  Hilton, W. S.

  Padley, Walter

  Boyden, James

  Hooley, Frank

  Page, Derek (King's Lynn)

  Bradley, Tom

  Horner, John

  Pannell, Rt. Hn. Charles

  Broughton, Sir Alfred

  Howell, Denis (Small Heath)

  Pavitt, Laurence

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

  Howie, W.

  Pearson, Arthur (Pontypridd)

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

  Huckfield, Leslie

  Pentland, Norman

  Butler, Herbert (Hackney, C.)

  Hunter, Adam

  Perry, George H. (Nottingham, S.)

  Butler, Mrs. Joyce (Wood Green)

  Jay, Rt. Hn. Douglas

  Prentice, Rt. Hn. Reg.

  Callaghan, Rt Hn. James

  Jenkins, Hugh (Putney)

  Price, Thomas (Westhoughton)

  Probert, Arthur

  Cant, R. B.

  Jones, Dan (Burnley)

  Rankin, John

  Carmichael, Neil

  Jones, J. Idwal (Wrexham)

  Richard, Ivor

  Chapman, Donald

  Jones, T. Alec (Rhondda, West)

  Roberts, Rt. Hn. Goronwy

  Coleman, Donald

  Judd, Frank

  Roberts, Gwilym (Bedfordshire, S.)

  Concannon, J. D.

  Kelley, Richard

  Robertson, John (Paisley)

  Dalyell, Tam

  Kerr, Russell (Feltham)

  Rodgers, William (Stockton)

  Darling, Rt. Hn. George

  Lawson, George

  Shaw, Arnold (Ilford, S.)

  Davidson, Arthur (Accrington)

  Leadbitter, Ted

  Silverman, Julius

  Davies, Ednyfed Hudson (Conway)

  Lee, Rt. Hn. Jennie (Cannock)

  Slater, Joseph

  Davies, G. Elfed (Rhondda, E.)

  Lestor, Miss Joan

  Small, William

  Davies, Rt. Hn. Harold (Leek)

  Lewis, Ron (Carlisle)

  Spriggs, Leslie

  Davies, S. O. (Merthyr)

  Lomas, Kenneth

  Steele, Thomas (Dunbartonshire, W.)

  Dempsey, James

  Lyon, Alexander W. (York)

  Swain, Thomas

  Dewar, Donald

  Lyons, Edward (Bradford, E.)

  Taverne, Dick

  Dobson, Ray

  Mabon, Dr. J. Dickson

  Thomas, Rt. Hn. George

  Doig, Peter

  McBride, Neil

  Tinn, James

  Dunwoody, Mrs. Gwyneth (Exeter)

  McCann, John

  Varley, Eric G.

  Eadie, Alex

  MacColl, James

  Wainwright, Edwin (Dearne Valley)

  Edwards, Robert (Bilston)

  MacDermot, Niall

  Walker, Harold (Doncaster)

  Edwards, William (Merioneth)

  McElhone, Frank

  Watkins, David (Consett)

  English, Michael

  Ennals, David

  McGuire, Michael

  Watkins, Tudor (Brecon & Radnor)

  Ensor, David

  Mackenzie, Gregor (Rutherglen)

  Weitzman, David

  Evans, Fred (Caerphilly)

  Maclennan, Robert

  Wellbeloved, James

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

  McMillan, Tom (Glasgow, C.)

  Wells, William (Walsall, N.)

  Fernyhough, E.

  McNamara, J. Kevin

  Wilkins, W. A.

  Finch, Harold

  MacPherson, Malcolm

  Willey, Rt. Hn. Frederick

  Fitch, Alan (Wigan)

  Mahon, Simon (Bootle)

  Williams, Clifford (Abertillery)

  Fletcher, Raymond (Ilkeston)

  Mallalieu, E. L. (Brigg)

  Willis, Rt. Hn. George

  Fletcher, Ted (Darlington)

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

  Winnick, David

  Foot, Michael (Ebbw Vale)

  Mapp, Charles

  Woodburn, Rt. Hn. A.

  Ford, Ben

  Marks, Kenneth

  Woof, Robert

  Forrester, John

  Mellish, Rt. Hn. Robert

  Fowler, Gerry

  Millan, Bruce

  TELLERS FOR THE AYES:

  Freeson, Reginald

  Miller, Dr. M. S.

  Mr. William Hamling and

  Galpern, Sir Myer

  Milne, Edward (Blyth)

  Mr. Ernest G. Perry.

  NOES

  Alison, Michael (Barkston Ash)

  Balniel, Lord

  Boardman, Tom (Leicester, S. W.)

  Allason, James (Hemel Hempstead)

  Bennett, Dr. Reginald (Gos. & Fhm)

  Body, Richard

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

  Bessell, Peter

  Boyd-Carpenter, Rt. Hn. John

  Baker, W. H. K. (Banff)

  Biffen, John

  Brewis, John

  Brown, Sir Edward (Bath)

  Heald, Rt. Hn. Sir Lionel

  Nott, John

  Bruce-Gardyne, J.

  Heseltine, Michael

  Page, Graham (Crosby)

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

  Higgins, Terence L.

  Peel, John

  Buck, Antony (Colchester)

  Hill, J. E. B.

  Percival, Ian

  Bullus, Sir Eric

  Holland, Philip

  Pike, Miss Mervyn

  Campbell, B. (Oldham, W.)

  Hornby, Richard

  Pounder, Rafton

  Campbell, Gordon (Moray & Nairn)

  Hunt, John

  Prior, J. M. L.

  Carlisle, Mark

  Jenkin, Patrick (Woodford)

  Pym, Francis

  Cary, Sir Robert

  Jennings, J. C. (Burton)

  Ramsden, Rt. Hn. James

  Chataway, Christopher

  Johnston, Russell (Inverness)

  Rhys Williams, Sir Brandon

  Clegg, Walter

  King, Evelyn (Dorset, S.)

  Rodgers, Sir John (Sevenoaks)

  Cooke, Robert

  Lancaster, Col. C. G.

  Rossi, Hugh (Hornsey)

  Corfield, F. V.

  Lane, David

  Russell, Sir Ronald

  Costain, A. P.

  Lawler, Wallace

  St. John-Stevas, Norman

  Crowder, F. P.

  Legge-Bourke, Sir Harry

  Scott-Hopkins, James

  Cunningham, Sir Knox

  Lubbock, Eric

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

  Currie, G. B. H.

  McAdden, Sir Stephen

  Silvester, Frederick

  Dalkeith, Earl of

  MacArthur, Ian

  Sinclair, Sir George

  Dance, James

  Mackenzie, Alasdair (Ross & Crom'ty)

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

  Dean, Paul

  Maclean, Sir Fitzroy

  Stainton, Keith

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

  Macleod, Rt. Hn. Iain

  Stoddart-Scott, Col. Sir M.

  Dodds-Parker, Douglas

  McMaster, Stanley

  Summers, Sir Spencer

  Eden, Sir John

  McNair-Wilson, Michael

  Taylor, Sir Charles (Eastbourne)

  Elliot, Capt. Walter (Carshalton)

  Maddan, Martin

  Thatcher, Mrs. Margaret

  Ewing, Mrs. Winifred

  Maginnis, John E.

  Waddington, David

  Farr, John

  Maxwell-Hyslop, R. J.

  Walker, Peter (Worcester)

  Fortescue, Tim

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

  Walker-Smith, Rt. Hn. Sir Derek

  Glover, Sir Douglas

  Mills, Stratton (Belfast, N.)

  Ward, Christopher (Swindon)

  Gower, Raymond

  Miscampbell, Norman

  Ward, Dame Irene

  Grant, Anthony

  Mitchell, David (Basingstoke)

  Whitelaw, Rt. Hn. William

  Grant-Ferris, Sir Robert

  Monro, Hector

  Wiggin, A. W.

  Griffiths, Eldon (Bury St. Edmunds)

  Montgomery, Fergus

  Williams, Donald (Dudley)

  Gurden, Harold

  More, Jasper

  Wolrige-Gordon, Patrick

  Hall-Davis, A. G. F.

  Morgan, Geraint (Denbigh)

  Worsley, Marcus

  Hamilton, Michael (Salisbury)

  Mott-Radclyffe, Sir Charles

  Wylie, N. R.

  Harrison, Brian (Maldon)

  Munro-Lucas-Tooth, Sir Hugh

  Harrison, Col. Sir Harwood (Eye)

  Nabarro, Sir Gerald

  TELLERS FOR THE NOES:

  Hawkins, Paul

  Neave, Airey

  Mr. Reginald Eyre and

  Mr. Timothy Kitson.

  Bill accordingly read the Third time, and passed.

RENT (CONTROL OF INCREASES) BILL
Considered in Committee.
[Mr. SYDNEY IRVING in the Chair]

Clause 1

  RESTRICTIONS ON INCREASES IN LOCAL AUTHORITY RENTS
  7.45 p.m.
  Mr. Graham Page: I beg to move Amendment No. 1, in page 1, line 18, at end insert:
  (d) in the absence of the increases it will be necessary for the local authority, in the observance of their obligations as to revenue and expenditure, to increase the general rate.
  The Chairman: With this Amendment we can also discuss Amendments No. 3, in Clause 3, page 2, line 43, after 'by', insert:
  'information as to the state of the financial reserves upon which the local authority will be obliged to draw in the event of the Minister being unable to agree to the proposals and'.
  and Amendment No. 4, in Clause 3, page 2, line 43, after 'such', insert 'further'.
  Mr. Page: This is an Amendment to Clause 1, which sets out the restrictions on increases in local authority rents. Subsection (1) says:
  "A local authority shall not, for any period beginning before 1st July, 1971 … charge in respect of houses … rents exceeding the former rents …"
  except in certain cases.
  Those cases are set out in the three paragraphs in the subsection. One is the limit of 10s. in any individual case, or an average of 7s. 6d. for a group of houses. Paragraph (b) allows an increase when proposals have been put to the Minister and the Minister has agreed to them. Paragraph (c) allows increases when they can be attributed to improvements or extensions to the house. This Amendment would add a fourth case, where unless the increase is made, it would be necessary for the local authority in carrying out its duties of expenditure and revenue in connection with housing to increase the general rate.
  Amendments Nos. 3 and 4 which we are discussing with this are Amendments to Clause 3, dealing with the proposals
  518
  to the Minister which I have mentioned. If the Minister accepts the proposals then the rent may be increased beyond the 10s.—7s. 6d. limit. The Amendments to Clause 3 seek to insert an obligation on a local authority, when making its proposals to the Minister, to tell him what reserves it has or has not upon which to draw in the event of his not agreeing to its proposal to increase the rents above the limits set out in the Bill. They would be telling the Minister which of the kids' piggy banks they would break into to make up the deficit.
  In explaining these Amendments I will refer to Report No. 62 of the National Board for Prices and Incomes, "Increases in Rents of Local Authority Housing", to which the Minister of State referred on Second Reading. Although it was published in April, 1968, and although the figures must be out of date, the facts set out in that report are still correct and are relevant to the Amendment. The report carefully explains on page 2, in paragraph 7:
  "The local housing authorities are required by statute to make 'reasonable charges' for their dwellings. This requirement has been interpreted by the Courts to mean broadly that a reasonable balance should be maintained as between tenants and groups of tenants, and between the general body of ratepayers and council tenants as a whole."
  In practice, that gives local authorities wide powers to set rents as they please. The report explains in paragraph 8,
  "Within this fairly wide area … local housing authorities have to observe certain rules."
  Those rules apply to the keeping of two separate accounts—a separate housing revenue account and a separate housing repairs account. The separate housing revenue account has to be maintained to show the expenditure and income relating to the authority's council houses. The report states:
  "A deficit on the Account cannot be carried forward from one year to the next, and has to be made good by a contribution from the rates."
  This is the point which is relevant to the Amendment. If there is to be a deficit on the housing revenue account, that must be made up from some source, whether it be from the rents, from a rate contribution or by some manipulation—and I do not mean that in any wrong way—of the account from the point of

  519
  view of the capital repayment to that account.
  There is then reference to the housing repairs account, to which there must be a minimum contribution from the housing revenue account of £8 per dwelling per year. Most local authorities distribute the costs of their housing and therefore charge rents over the entire housing stock, generally making allowances for differences in the age of houses or the amenities. In this way the costs are spread over. That method of distributing costs is usually known as rent pooling.
  The report explains that the Prices and Incomes Board studied a number of local authorities to discover the reasons attributed for rent increases. The board found that 21 per cent. of the local authorities reported that they considered that the most important factor to which the rise could be attributed was the rising housing programme; 16 per cent. thought that it was the rising cost of maintenance and repair; 15 per cent. thought that it was the rising cost of construction; 29 per cent. thought that it was rising interest rates; and 4 per cent. reported that the reduction on the abolition of the rate fund contributions to the housing revenue account was the main cause of rent increases. The report adds:
  "Only 4 per cent. suggested that the increases might be due to a change in or the introduction of a rebate scheme."
  This report was published in April, 1968. It referred to increases in the building programme. I imagine from the very severe reduction in the housing programme that at present this is not such an important factor and that it is not necessary to spread the cost of the rising housing programme over all the rents of council houses because the programme is no longer rising. Because of the Government's extraordinary policy, it is dropping.
  Probably moving to the top of the list is construction costs, which have increased substantially and which will increase in future if the wage demands of the employees in the construction industry are granted in full—as, indeed, there seems to be every indication that they will be granted. The increase in the cost of building houses, therefore, will find its reflection in the rents when spread over the
  520
  whole of the stock in any one local authority.
  The corresponding increase in the cost of repairs will also result, and in the past has resulted, in the need for an increase in rents. The increase in management costs has the same effect. Many local authorities attributed some of the most substantial rises in rents to the increase in interest rates. The report mentions the short-term borrowing from the Euro-dollar market as an increasing cost of local authority housing.
  Only a few weeks ago I was in Tanzania talking to the chief of the Bank of Tanzania and teasing him about the control which he had over his Government by controlling the money in his bank and lending it to his Government.
  The Minister of State, Scottish Office (Dr. J. Dickson Mabon): Order.
  Mr. Page: Apparently the hon. Member thinks that I am out of order. I will tell him why I am in order. I asked the chief of that bank the rate of interest he paid to his depositors, and he said that it was 8½ per cent. I said, "I suppose that you lend it to your Government as you choose and control their policies in that way". He replied, "No. I lend it to councils in your country at 11 per cent." That is from Tanzania—a country asking for aid from us. If that is the sort of borrowing that local authorities do, there is little wonder at the expense which is reflected in their housing programmes.
  Mr. Eric Lubbock: Could the hon. Member exercise his influence on his friend and get me an overdraft with the Bank of Tanzania?
  Mr. Page: The hon. Member for Orpington (Mr. Lubbock) will understand that I asked exactly the same question when I first heard of the rate of interest on deposits.
  It may be said that local authority borrowing for the purposes of housing is subsidised by the Government in that a local authority pays only 4 per cent. on the money which it borrows and the balance is a subsidy. But of course all that money is put into one kitty at the pool rate, as it is called, so that it is a little more than a drop in the ocean. When a local authority is borrowing at

  521
  such a high rate of interest for other purposes and is spreading the money all over, at an average, in fact it is not building or repairing its houses with money borrowed at 4 per cent.
  Mr. Frank Allaun: Under the hon. Member's proposal, the whole burden of looking after the area of the local authority, with high interest rates, and so on, and not simply the expense of council houses, would be laid upon the council tenant.
  8.0 p.m.
  Mr. Page: The hon. Member has not read the Amendment correctly. I have read it to the Committee and I shall not do so again. I ask the hon. Member to read it.
  It is frequently said that, for housing, local councils borrow money at a very low rate of interest because anything above 4 per cent. is subsidised. That interest is spread over the whole of the local authority activities and the money is then taken out of the pool at the average rate of interest.
  Mr. Julius Silverman: While it is true that the money is borrowed from what is called the Consolidated Fund at a general rate of interest, the subsidy is confined entirely to the housing revenue account.
  Mr. Page: Yes. All I was trying to say is that when local authorities complain of the high rate of interest causing the necessity to increase rents, which is reported as a major complaint of the local authorities, it is no answer to them that they get their money at a very low rate of interest, because when allocated to the housing account it is not at that low rate, but at an average rate.
  The Chairman: Order. I hesitate to interrupt the hon. Member, who is so scrupulously careful about the rules of order, but I find it a little difficult to relate his remarks to the Amendments, one of which concerns the absence of increases on the general rate and another of which is concerned with information. Perhaps the hon. Member will help me.
  Mr. Page: I thought it necessary, Mr. Irving, to give the background about how local authorities accumulate reserves, to which reference is made in Amendment No. 3, and to deal with the question of
  522
  whether, when their reserves have run out, they have to resort to a rate fund contribution. If they have to resort to a rate fund contribution, they may have to increase the rates. That comes within Amendment No. 1. I think that the background which I was endeavouring to give is entirely relevant.
  When one looks at the reasons for increases in rent, one sees that they are almost wholly attributable to the policies of the Government—for example, the increases in interest rates, the cost of construction and other things. It is by reason of those policies that increases in rent are necessary and the Government now say that those increases should fall upon the ratepayer.
  The Amendment seeks to allow the local authority to make the increase and avoid an increase in the general rate. If the housing revenue account is in credit, it is not necessary to increase the general rate to keep within the law. Local authorities have to abide by certain rules, one of which is that they must keep their housing revenue account in credit. If they have any other source to which to resort, the Amendment would not come into operation, but where they can satisfy the Minister that the only way to obey the law and keep their housing revenue account in credit is to increase the rates, they should be given discretion either to charge the rents or to charge the ratepayers, as they see fit, in observing their duties as local government elected bodies.
  In the Bill, local authorities are restricted to an increase of an average of 7s. 6d. a week instead of being allowed to strike a fair balance between council tenants as a whole and the general body of ratepayers, as was said to be their duty in the report of the Prices and Incomes Board. If this restriction imposed in the Bill comes into operation, it will cause great unfairness to the general body of ratepayers and will fail to keep a fair balance.
  Mr. James Allason: My hon. Friend the Member for Crosby (Mr. Graham Page) has given examples to show why costs are rising. He rather dismissed the question of new house building, but let me assure him that in certain parts of the country new council house building can have a considerable effect. I am thinking of places

  523
  where rents are low for historic cost reasons. For example, a substantial number of houses might have been built at a time when building costs were cheap and, therefore, the rents are low. If, however, there has to be a further steady stream of council building next year or subsequently and a new scheme comes into operation, the new building will have a considerable effect. This is a good example of the sort of case that we must consider. Costs will rise considerably.
  Under the Bill, a local authority will be entitled to raise its rents by an average of 7s. 6d. a week over its whole pool of houses. That figure might not be enough. The local authority then turns to the housing revenue account, finds that it is a little in credit and uses it all up, but even that is not enough. That is the situation that we are considering in Amendment No. 1.
  Therefore, it falls squarely on the Government to say what they intend. Is it that the whole of the cost shall fall on the ratepayer and the rates must be increased, or would they in these circumstances wish rents further to increase, remembering the case to which I have referred, in which the historic costs are low and, therefore, rents are quite low?
  There is a further alternative which I have posed to the Government on two occasions, but which they always dodge. The third alternative is the one which, I fear, will be used. That is to say, with new building there is no requirement to fix rents in line with the other rents charged by the local authority. Therefore, the local authority will be gravely tempted for new housing to fix a much higher rent than is charged for the rest of its pool of accommodation. To me, that it totally unacceptable.
  Surely, that must be unacceptable to the Government, too. They will not say this or face the situation. I wish that they could say something about it. If it is their intention that these further costs, which cannot be absorbed in the way I have described, must fall on the ratepayer, let them say so and let us see that this is a Bill deliberately intended to increase the rates next year in the circumstances with which we are dealing. If that is what the Government say, fair enough, but for
  524
  goodness' sake let them come forward and face these three alternatives and say which one they prefer.
  Mr. Julius Silverman: I intervene only briefly. I agree with the analysis which has been made of the factors in the costs and rents of council houses. New housing is one, rates of interest is another, increased cost of repairs is another, and the introduction of rebate schemes another. I agree entirely with the hon. Member for Hemel Hempstead (Mr. Allason) that for a number of authorities the construction of new houses means a major increase in costs.
  What happens is this, and perhaps I can spell it out a little more clearly than the hon. Member. A local authority decides to build a number of new houses. The houses cost very much more than the old houses cost, and notwithstanding the Housing Subsidies Act the economic costs of those rents, even allowing for housing subsidies, will be very high, and, the council would say, much higher than the tenants of those houses can pay.
  The hon. Gentleman agrees with me about that. So what does the authority do? It says that the tenants must pay the difference and must pay a subsidy. If it is necessary to build these new houses one would have thought that at any rate the ratepayers would pay a share of the cost instead of the council's going to the council house tenants and saying, "Because we are enlarging our housing programme you will have to pay the bill." This is resented by council tenants, and quite understandably; and to say that the whole of this cost should be borne by existing council tenants is wholly wrong. That is the first point.
  The introduction of rebate schemes is another case and it is dealt with in a subsequent Amendment on which I hope to catch your eye, Mr. Irving, later. I think that someone hopes that I shall not succeed, but, nevertheless, I shall try.
  Other matters are the rates of interest and the increased cost of repairs. It is quite true that with houses which were built before the Housing Subsidies Act, the rate of interest is a major factor. I accept that. It is also true that the increased cost of repairs is a factor, and it is not unreasonable that the tenant should bear those costs, but I do not believez

  525
  that these increases can conceivably amount in any case to a total of more than 7s. 6d. An increase of 7s. 6d. a week for a year is certainly more than sufficient to take charge of those costs, even if all those costs are legitimate against the tenant.
  Therefore, I agree entirely with what has been said, that there should be a balance between the ratepayer and the tenant but the balance should be struck in the right way, and this Amendment certainly does not do that.
  8.15 p.m.
  Mr. Wallace Lawler: I am not quite sure that I follow as fully as one ought the arguments advanced by the hon. Member for Hemel Hempstead (Mr. Allason) and the hon. Member for Birmingham, Aston (Mr. Julius Silverman). They have talked about current construction costs in the public sector. One would have thought that the 4 per cent. ceiling does protect the council tenant in this respect.
  Furthermore, I am by no means influenced by the arguments of the hon. Member for Crosby (Mr. Graham Page). One should not accept automatically that an increase which goes above 7½ per cent. can be justified in terms of the state of the housing revenue account, say, two or three months before the close of the financial year and automatically be placed on the backs of the ratepayers.
  There are one or two pertinent questions which arise from this, and certainly one rather interesting example. A few years ago one large local authority with which I was connected found a few months before the end of the housing year that a quite sizeable rents increase was anticipated and that a heavy deficit was in store. A conscientious housing officer would call the chairman of the housing committee into conference, and one would hope that he would confer with the housing committee itself, but in this case he had a few words with the chairman of the housing committee and pointed out the position which would arise in two or three months at the end of the housing year, the same position which this present Amendment is seeking to anticipate.
  Ways and means were found to avoid the deficit during the succeeding few months. One of the ways was an in-
  526
  teresting example of what the hon. Member for Aston deplored in the debate last week: let us put a levy on each tenant, transferring one with another; let us put from 8s. to 15s. a week on each future letting of postwar dwellings. The hon. Member for Aston will remember the occasion. Someone closely connected with his own political party did this in the City of Birmingham.
  I would be very interested, before making a final decision about the Amendment, to know the attitude of the Minister of State to this and whether he agrees with his colleague who in the debate last week said that it was perhaps a less painful way of avoiding the deficit. If that is the authoritative Government view it would be interesting to have an assurance that it is. There are tens of thousands of council house tenants who take an entirely opposite view and who think that it is quite wrong, but the present legislation leaves open the door very wide for a council still to employ, even in terms in excess of 7s. 6d. a week, the same kind of devious and, to my mind, most dishonest way of avoiding a deficit a few months before the end of the housing year.
  I would repeat that it is not necessarily a "must" that any increase over 7s. 6d. should come from the ratepayer. A wise housing authority is able to see the size of its anticipated deficit on the housing account at least halfway through the housing year, and there are many and various ways which can be taken. I have mentioned one, with which I thoroughly disagree, but there are others—cuts, overdue perhaps, in heavy administrative costs, in some large authorities running at very high levels; value for money in expenditure, something with which almost every council tenant in the country would agree; streamlining of procedure in connection with repairs—perhaps allowing only three officials to visit a council house instead of six in connection with each repair. There are very many ways in which increased expenditure can be anticipated and avoided. It is a somewhat hopeless situation for the Opposition to suggest to us that we have simply to say, "Any increase above the level proposed in the Bill should be placed upon the backs of the ratepayers."
  I hope that the Minister of State, who seems to find my contribution, which I

  527
  could not make last week because of illness, somewhat entertaining, will take this point rather seriously and give us an authoritative reply and an explanation of the attitude which the Minister of Stale takes with regard to the devious manner, which I have suggested, by which he is still leaving it open for local authorities to avoid deficits by a system of very wrong and totally unjustified differential rents for a very small section of council house tenants.
  Dr. Dickson Mabon: We have had a good-natured debate, and I would be the last to disturb the tenor of our discussion. It might be suggested by some that the three Amendments which we are discussing could be described as wrecking Amendments, but I would not for a moment dream of using these terrible words.
  I confirm the point made by the hon. Member for Crosby (Mr. Graham Page), that under the Fifth Schedule of the Housing (Financial Provisions) Act, 1958, every local authority has to make a contribution from the general rate fund to the housing revenue account to meet any deficit which may arise in that account in any financial year. Thus, in any year, if rents, exchequer subsidies and other income credited to the account do not meet the cost falling on the account, a rate contribution has to be made to make up that shortfall.
  Whether the contribution, or an increase in the contribution, leads to an increase in the general rate depends upon the balance in the general rate fund and the extent to which the local authority is willing to run down the balance. I think that is why Amendments Nos. 1, 3 and 4 have been tabled. They are designed to provide the Minister with information about the authority's rate fund balances as well as housing account balances.
  The Amendment, as drafted, is too imprecise to make any sense. It will be impossible to define or to state exactly when a rent increase is necessary to avoid an increase in the general rate. No authority can precisely estimate in advance, despite what the hon. Member for Birmingham, Ladywood (Mr. Lawler) has said. I am sorry that we were deprived of his company last week for health reasons, and I am glad that he is back in
  528
  health again. No authority can precisely estimate in advance what balance there will be in the rate fund as a result of expenditure on all rate-borne services.
  Nor can it, as I think the hon. Member for Crosby will admit, estimate precisely the prospective deficit in the housing revenue account and the rate fund contribution which will be needed to meet that deficit. It would be impossible even for him to establish beyond argument whether the authority has reached the point where it is faced with a straight choice between a rent increase and an increase in the rate fund contribution. There will always be other alternatives open to the authority.
  The hon. Member for Ladywood gave one alternative which he entirely rejected. He gave other alternatives which I would regard as being arguments which should apply in any local authority. They related not to policy but to administrative efficiency. That is not the monopoly of any one party but is enjoyed by certain individuals and denied to others—I will not go into who is who tonight. That is not a policy argument, but an argument of efficiency. It is a matter for consideration by the individuals in charge of any authority at any time.
  There may be a balance left on the housing revenue account, the housing repairs account or the housing equalisation account; or the authority might be able to cut expenditure on maintenance, run up a deficit in the housing repairs account for that year, or cut down its housing programme. These would, in our view, be bad alternatives, but it is impossible to say when such an alternative is so bad as to be ruled out and make "necessary", in the words of the Amendment, an increase either in rents or rates.
  I was pleased that my hon. Friend the Member for Birmingham, Aston (Mr. Julius Silverman) made the point in favour of the policy in the Bill and against the Amendments, that we aim in the Bill—and I hope the hon. Member for Ladywood is with us on this—to strike a fair balance between the requirements of the Prices and Incomes policy at any given time—a moderating influence—and the interests of the tenants, on the one hand, and the interests of the rate-payers, on the other.
  The Bill gives the Minister discretionary power to control rent increases where

  529
  these prima facie, conflict with any given prices and income policy. The Minister must be allowed to use that discretion in relation to all relevant considerations. One of these is the estimated effect of a rent increase on the size of the rate fund contribution. But this should not be an overriding consideration in respect of which he cannot exercise discretion.
  The hon. Member for Crosby referred to the Report of the National Board for Prices and Incomes, and I agree that the amount of the estimated rate fund contribution would be relevant. So would the rent increases which the tenants have already had to bear. The report recommended that a rate fund contribution should be made where this made it possible to keep an average rent increase to 7s. 6d. in any year. Moreover, a rate fund contribution made in any year can be repaid to the general rate fund in any of the nine subsequent years.
  In nearly all cases a local authority will be able to meet unavoidable increases in costs by an increase in rent averaging not more than 7s. 6d. a week. I thought that my hon. Friend the Member for Aston made a good point here. Looking back on the experience of the majority of local authorities in England, Wales and Scotland this has been borne out by the facts. In that case, the authority will not need to submit a new proposal to the Minister, but in the few cases where my hon. Friend the Member for Aston is wrong, and where the Government feel that on balance there might be merit in a proposal that the increase should be more than that, then it is right that the Minister should be able to consider whether a larger average rent increase is justified. This is the essence of the division between us.
  The Amendments are not only defective in drafting, but detract from the whole purpose of the Bill. I would not for a moment belie their importance; they are fundamental Amendments. I understand the intention. I do not rest my case for rejection on their drafting imperfection. I am simply saying that in policy terms they are wrong, and ill founded, and I hope that the House will reject them.
  Mr. Allason: The Minister has not dealt with my alternative suggestion that the local authority might seek to let new
  530
  dwellings at a substantially higher rent. Will he say what is his policy on that?
  Dr. Mabon: I apologise for not answering that point. We favour the idea of rent pooling. I am not sure whether the hon. Gentleman is against the idea that the authority should make a realistic assessment of rents for new houses or whether he is for this. But, on balance, a judgment has to be made on both the present stock of houses and on the new houses being built. It would be totally unfair to throw this entirely on the responsibility of new tenants, existing council tenants or rent payers. A balance must be struck between all the individuals concerned rather than selecting one as opposed to another to bear the cost of the new developments.
  [Miss HARVIE ANDERSON in the Chair]
  Mr. Charles Mapp: I should like to relate the Amendment, cruel as it is, to the problems of a town faced with difficult problems of clearance of unfit houses. Where there is a great backlog of unfit houses, the Amendment provides for the additional cost of providing new units to fall wholly on the municipal tenants.
  I should like to take as an illustration my own town, in which in 1955 nearly half the houses comprised unfit dwellings. At the moment a quarter of the 42,000 houses are unfit. The movers of the Amendment should speak to 40 or 50 other authorities in the country with this acute problem, and should say to them, "The clearance of unfit houses and the rebuilding of your town must be at the expense of your municipal electors."
  We in Oldham have about 12,000 municipal houses of which about half are post-war. We have 11,000 houses still to clear, and the Tories have taken a rate of 400 houses a year for clearance as against a figure of towards 1,000 houses which was achieved a year or so ago. This means that the job will be three times as long and also that the problem of clearing those unfit houses in such a town will rest on a quarter of the ratepayers.
  Nothing is said in the Amendment about the responsibility of industry in such towns. There are no obligations upon them to help house, or even take

  531
  an interest in housing, the people who work for them. Equally, commercial premises in such towns as Oldham have no obligation to be interested in any way in the clearing of unfit property.
  My authority is already burdened on the general rate fund at the rate of about 3s. in the £ towards assistance in the housing programme. That on a penny rate, giving £12,000 to £13,000, would mean £40 to £45 per year on each council house on the principle that one should not put any of the cost on the general rate fund.
  I make this point to show how cruel and callous is the Amendment before the Committee. It is inhuman to talk from a Tory point of view about clearing unfit houses. Let them talk to the 40 or 50 authorities in the country with such a backlog and then they will realise what should be done.
  In Oldham, which in the past has had immense mining problems, all or some of the unfit areas must be cleared before rebuilding can take place. The costs of clearance and of examination of the land to avoid mining subsidence, and the whole of the capital costs involved between the time the first bulldozer goes into the area and the time when the first tenant goes into occupation, have to be taken at interest of nearly 10 per cent. The interim effect on any authority such as that in my area, whose back is already nearly broken by the problem of financing the rebuilding and pulling down of houses, is unbearable.
  I hope that the Committee will reject this foolish Amendment. I feel that had it been possible the authority would have taken a 12s. 6d. increase for the municipal tenant to pay. I do not believe that
  people expect that these unfit areas should be cleared wholly at the expense of municipal tenants. Although I will resist this Amendment, I hope that the Minister of State will bear in mind the problems of local authorities in regard to unfit dwellings which deserve most serious attention, and I hope some action quite shortly.
  Mr. Graham Page: I appreciate the problems mentioned by the hon. Member for Oldham, East (Mr. Mapp), but I think that he has misread the Amendment. The Amendment does not require the deficit on housing revenue account automatically to be paid by the council tenants, and therefore does not necessarily cause hardship to the tenants. The Amendment seeks to leave the local authority to carry out its duties as the elected local government body.
  The Minister of State said that the Amendment was too vague. But he appears to have understood it since he said that it was a wrecking Amendment. The meaning is clear, and if any provisos are necessary to stop up any loopholes that is the job of the parliamentary draftsmen. The Amendment as it appears on the Order Paper is sufficient and clear. It is clear that the Government intend ratepayers to pay the whole of the balance of the deficit above the limits set in the Bill and thus will deprive local authorities of their right and duty to strike a balance between the ratepayers and the council tenants. All the Amendment intends is to leave the local authorities with that right. In view of the reply we have received, I hope that my hon. Friends will divide the Committee.
  Question put, That the Amendment be made:—
  The Committee divided: Ayes 126, Noes 185.

  Division No. 15.]

  AYES

  [8.33 p.m.

  Allason, James (Hemel Hempstead)

  Carlisle, Mark

  Elliot, Capt. Walter (Carshalton)

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

  Cary, Sir Robert

  Eyre, Reginald

  Baker, W. H. K. (Banff)

  Chataway, Christopher

  Farr, John

  Balniel, Lord

  Clegg, Walter

  Fortescue, Tim

  Bennett, Dr. Reginald (Gos. & Fhm)

  Cooke, Robert

  Foster, Sir John

  Biffen, John

  Corfield, F. V.

  Glover, Sir Douglas

  Body, Richard

  Costain, A. P.

  Gower, Raymond

  Boyd-Carpenter, Rt. Hn. John

  Craddock, Sir Beresford (Spelthorne)

  Grant, Anthony

  Boyle, Rt. Hn. Sir Edward

  Crowder, F. P.

  Griffiths, Eldon (Bury St. Edmunds)

  Brewis, John

  Cunningham, Sir Knox

  Gurden, Harold

  Brown, Sir Edward (Bath)

  Currie, G. B. H.

  Hall-Davis, A. G. F.

  Bruce-Gardyne, J.

  Dalkeith, Earl of

  Hamilton, Michael (Salisbury)

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

  Dance, James

  Harrison, Brian (Maldon)

  Buck, Antony (Colchester)

  Dean, Paul

  Harrison, Col. Sir Harwood (Eye)

  Bullus, Sir Eric

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

  Hawkins, Paul

  Campbell, B. (Oldham, W.)

  Dodds-Parker, Douglas

  Heald, Rt. Hn. Sir Lionel

  Campbell, Gordon (Moray & Nairn)

  Eden, Sir John

  Heseltine, Michael

  Higgins, Terence L.

  Morgan, Geraint (Denbigh)

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

  Hill, J. E, B.

  Mott-Radclyffe, Sir Charles

  Smith, John (London & W'minster)

  Holland, Philip

  Munro-Lucas-Tooth, Sir Hugh

  Stainton, Keith

  Hornby, Richard

  Nabarro, Sir Gerald

  Stoddart-Scott, Col. Sir M.

  Hunt, John

  Neave, Airey

  Summers, Sir Spencer

  Jenkin, Patrick (Woodford)

  Nicholls, Sir Harmar

  Taylor, Frank (Moss Side)

  Jennings, J. C. (Burton)

  Nott, John

  Temple, John M.

  King, Evelyn (Dorset, S.)

  Page, Graham (Crosby)

  Thatcher, Mrs. Margaret

  Lancaster, Col. C. G.

  Page, John (Harrow, W.)

  Tilney, John

  Lane, David

  Peel, John

  van Straubenzee, W. R.

  Legge-Bourke, Sir Harry

  Percival, Ian

  Vaughan-Morgan, Rt. Hn. Sir John

  McAdden, Sir Stephen

  Pike, Miss Mervyn

  Waddington, David

  MacArthur, Ian

  Pink, R. Bonner

  Walker, Peter (Worcester)

  Maclean, Sir Fitzroy

  Pounder, Rafton

  Walker-Smith, Rt. Hn. Sir Derek

  McMaster, Stanley

  Prior, J. M. L.

  Ward, Christopher (Swindon)

  McNair-Wilson, Michael

  Pym, Francis

  Ward, Dame Irene

  Maddan, Martin

  Ramsden, Rt. Hn. James

  Wells, John (Maidstone)

  Maginnis, John E.

  Rhys Williams, Sir Brandon

  Whitelaw, Rt. Hn. William

  Maxwell-Hyslop, R. J.

  Rodgers, Sir John (Sevenoaks)

  Wiggin, A. W.

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

  Rossi, Hugh (Hornsey)

  Williams, Donald (Dudley)

  Mills, Stratton (Belfast, N.)

  Russell, Sir Ronald

  Wolrige-Gordon, Patrick

  Miscampbell, Norman

  St. John-Stevas, Norman

  Worsley, Marcus

  Mitchell, David (Basingstoke)

  Scott-Hopkins, James

  Wylie, N. R.

  Monro, Hector

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

  Montgomery, Fergus

  Silvester, Frederick

  TELLERS FOR THE AYES:

  More, Jasper

  Sinclair, Sir George

  Mr. Timotny Kitson and

  Mr. Bernard Weatherill.

  NOES

  Albu, Austen

  Finch, Harold

  MacColl, James

  Allaun, Frank (Salford, E.)

  Fitch, Alan (Wigan)

  MacDermot, Niall

  Alldritt, Walter

  Fletcher, Ted (Darlington)

  McElhone, Frank

  Anderson, Donald

  Foot, Michael (Ebbw vale)

  McGuire, Michael

  Atkins, Ronald (Preston, N.)

  Ford, Ben

  Mackenzie, Alasdair (Ross & Crom'ty)

  Atkinson, Norman (Tottenham)

  Forrester, John

  Mackenzie, Gregor (Rutherglen)

  Bacon, Rt. Hn. Alice

  Fowler, Gerry

  Mackie, John

  Baxter, William

  Freeson, Reginald

  Maclennan, Robert

  Beaney, Alan

  Galpern, Sir Myer

  McMillan, Tom (Glasgow, C.)

  Bence, Cyril

  Gardner, Tony

  McNamara, J. Kevin

  Bennett, James (G'gow, Bridgeton)

  Golding, John

  MacPherson, Malcolm

  Binns, John

  Gregory, Arnold

  Mahon, Simon (Bootle)

  Blackburn, F.

  Grey, Charles (Durham)

  Mallalieu, E. L. (Brigg)

  Boardman, H. (Leigh)

  Griffiths, David (Rother Valley)

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

  Booth, Albert

  Griffiths, Eddie (Brightside)

  Mapp, Charles

  Boston, Terence

  Hamilton, James (Bothwell)

  Marks, Kenneth

  Bottomley, Rt. Hn. Arthur

  Hamilton, William (Fife, W.)

  Mellish, Rt. Hn. Robert

  Boyden, James

  Hannan, William

  Millan, Bruce

  Bradley, Tom

  Harrison, Walter (Wakefield)

  Miller, Dr. M. S.

  Broughton, Sir Alfred

  Haseldine, Norman

  Milne, Edward (Blyth)

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

  Hazell, Bert

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

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

  Hilton, W. S.

  Molloy, William

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

  Horner, John

  Morris, Alfred (Wythenshawe)

  Butler, Herbert (Hackney, C.)

  Howell, Denis (Small Heath)

  Morris, Charles R. (Openshaw)

  Butler, Mrs. Joyce (Wood Green)

  Howie, W.

  Morris, John (Aberavon)

  Cant, R. B.

  Hoy, Rt. Hn. James

  Moyle, Roland

  Carmichael, Neil

  Huckfield, Leslie

  Neal, Harold

  Chapman, Donald

  Hughes, Roy (Newport)

  Newens, Stan

  Coleman, Donald

  Hunter, Adam

  Norwood, Christopher

  Concannon, J. D.

  Jay, Rt. Hn. Douglas

  Ogden, Eric

  O'Halloran, Michael

  Dalyell, Tam

  Jenkins, Hugh (Putney)

  Orbach, Maurice

  Darling, Rt. Hn. George

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

  Oswald, Thomas

  Davidson, Arthur (Accrington)

  Johnston, Russell (Inverness)

  Owen, Will (Morpeth)

  Davies, Ednyfed Hudson (Conway)

  Jones, Dan (Burnley)

  Page, Derek (King's Lynn)

  Davies, G. Elfed (Rhondda, E.)

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

  Pannell, Rt. Hn. Charles

  Davies, S. O. (Merthyr)

  Jones, J. Idwal (Wrexham)

  Pavitt, Laurence

  Dempsey, James

  Jones, T. Alec (Rhondda, West)

  Pearson, Arthur (Pontypridd)

  Dewar, Donald

  Judd, Frank

  Pentland, Norman

  Dickens, James

  Kelley, Richard

  Perry, Ernest G. (Battersea, S.)

  Dobson, Ray

  Kerr, Russell (Feltham)

  Perry, George H. (Nottingham, S.)

  Doig, Peter

  Lawler, Wallace

  Prentice, Rt. Hn. Reg.

  Dunnett, Jack

  Lawson, George

  Price, Thomas (Westhoughton)

  Dunwoody, Mrs. Gwyneth (Exeter)

  Leadbitter, Ted

  Probert, Arthur

  Eadie, Alex

  Lee, Rt. Hn. Jennie (Cannock)

  Rankin, John

  Edwards, Robert (Bilston)

  Lee, John (Reading)

  Richard, Ivor

  Edwards, William (Merioneth)

  Lestor, Miss Joan

  Roberts, Rt. Hn. Goronwy

  English, Michael

  Lewis, Ron (Carlisle)

  Roberts, Gwilym (Bedfordshire, S)

  Ennals, David

  Lomas, Kenneth

  Robertson, John (Paisley)

  Ensor, David

  Lubbock, Eric

  Ryan, John

  Evans, Fred (Caerphilly)

  Lyon, Alexander W. (York)

  Shaw, Arnold (Ilford, S.)

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

  Lyons, Edward (Bradford, E.)

  Silverman, Julius

  Ewing, Mrs. Winifred

  Mabon, Dr. J. Dickson

  Slater, Joseph

  Faulds, Andrew

  McBride, Neil

  Small, William

  Fernyhough, E.

  McCann, John

  Spriggs, Leslie

  534

  535

  Steele, Thomas (Dunbartonshire, W.)

  Walker, Harold (Doncaster)

  Williams, Clifford (Abertillery)

  Swain, Thomas

  Watkins, David (Consett)

  Willis, Rt. Hn. George

  Taverne, Dick

  Watkins, Tudor (Brecon & Radnor)

  Winnick, David

  Thomas, Rt. Hn. George

  Weitzman, David

  Woodburn, Rt. Hn. A.

  Tinn, James

  Wellbeloved, James

  Woof, Robert

  Varley, Eric G,

  Wells, William (Walsall, N.)

  Wainwright, Edwin (Dearne Valley)

  Wilkins, W. A.

  TELLERS FOR THE NOES:

  Wainwright, Richard (Colne Valley)

  Willey, Rt. Hn. Frederick

  Mr. Joseph Harper and

  Mr. William Hamling.

  Mr. Alick Buchanan-Smith: I beg to move Amendment No. 2, in page 2, line 5, after 'to', insert:
  'executed or proposed maintenance of or'.
  When discussing the last Amendment we said that as a result of the Bill there will be considerable financial pressure on local authorities because of holding down rents. As my hon. Friend the Member for Crosby (Mr. Graham Page) said, for local authorities this creates particular problems in balancing their housing accounts. More specifically, it creates a problem for ratepayers on whom this burden is likely to be placed.
  8.45 p.m.
  Every local authority will seek one way or another of making economies on account of having to hold down their rents. One way in which they will try to make economies will be on house maintenance. The hon. Member for Birmingham, Ladywood (Mr. Lawler) spoke of authorities looking for economies. I agree with the Minister of State, Scottish Office, that we hope that they are looking for economies all the time. Equally, it must be appreciated that for many local authorities repairs and maintenance can involve large sums.
  The hon. Member for Birmingham, Aston (Mr. Julius Silverman) mentioned the high cost of repairs and maintenance for certain types of council houses, particularly older ones. Therefore, if a local authority is looking for economies in one way or another, because it is unable to make a sufficient increase in rent to balance its housing revenue account, economies may be made in house maintenance. This could provide a dangerous temptation for standards of maintenance to be cut.
  Subsection (4) makes an exception from rent control for increases in rent that are
  "attributable to improvements or extensions to the house".
  The Amendment seeks to add to this exception an increase in rent attributable
  536
  to "executed or proposed maintenance". This is of special importance as regards older local authority houses, because these are the houses where charges for repair and maintenance are likely to be particularly high.
  The Amendment is of special importance to tenants of such houses in that it would ensure that their houses are properly maintained.
  Mr. Julius Silverman: Can the hon. Gentleman cite any case where the increased cost of repairs amounts to anything like 7s. 6d. per week? The Amendment speaks of "proposed maintenance". Does this mean that it would be possible for a local authority to increase rents because of repairs which had not been carried out but which were proposed?
  Mr.Buchanan-Smith: "Proposed maintenance" means exactly what it says. There can be no dispute about the meaning. The hon. Gentleman's first point about the increased cost of repairs would be valid if rents were being increased only on this account, but a local authority must need increased rents for other reasons. There are not only costs of maintenance and repairs. There are costs of borrowing, to give only one example, which rise continually because of the policies of the present Government. It is incorrect to treat an increase of 7s. 6d. a week purely within the bracket of maintenance and repairs. I can think of instances where increased other costs and increased costs of maintenance and repairs will easily amount to more than 7s. 6d a week in any one year.
  We move the Amendment, not because we wish to put heavier rents on to tenants, but to safeguard tenants and to ensure that where maintenance and repairs are needed the local authority will not be tempted to skimp and save and thereby not provide a proper service to tenants.
  Mr. James Dempsey: I paid the greatest attention to what the hon. Member for North Angus

  537
  and Mearns (Mr. Buchanan-Smith) was saying. I was waiting for some evidence of local authorities which are not maintaining houses. It is relevant for the Committee to recall that rents of municipal houses have been increased regularly over the past few years, but in all such cases the increase has been within the purse of the ordinary tenant of municipal houses. In the County of Lanark, where I live, scarcely a year passes but municipal rents are increased, within reason, to a figure which the average tenant can afford to pay. As a result, the houses have always been well maintained.
  Indeed, I find in the County of Lanark the converse of the situation described by the hon. Member for North Angus and Mearns. He might be interested to know that not only does the local authority maintain the houses, but it has now started remodelling the old munition houses. A tenant is transferred from an old munition house, the house is remodelled, and in this way these houses are brought up to date. That is what one would call applying a fertile brain towards maintaining the best possible housing conditions in the county. There has never been any danger of houses being neglected there.
  I recall some authorities which attempted to get the tenants to meet the cost of certain repairs, but it was discovered that the technicalities of the improvements or maintenance were beyond the capacity of the tenants. Therefore, the local authorities stepped in to ensure that panes of glass were placed in the windows and that the doors would lock, and such other repairs as were essential were done out of the existing housing revenue account.
  I am, therefore, amazed to hear of the case mentioned by the hon. Member for North Angus and Mearns when he said that if the rents were increased by 7s. 6d. there would be grave danger of the houses falling into disrepair. I should like the hon. Gentleman to quote one town in Scotland where municipal houses have fallen into disrepair. In the County of Lanark the average increase is 3s. or 3s. 6d. and the county is responsible for all the repairs and maintenance.
  Mr. A. P. Costain: Would the hon. Gentleman tell the Committee what is the average cost
  538
  of maintenance in Lanarkshire and how much is spent per house?
  Mr. Dempsey: I cannot say. I do not have those figures. But I do know that these repairs and maintenance are done out of the housing revenue account. Anybody with any sense of responsibility will expect the general ratepayer to contribute to the council housing account. [An HON. MEMBER: "Why?"] Because otherwise the rents would become so extortionate that many of the applicants would be chased back to the old but-and-bens, back to the single ends, as we used to call them, and young married couples would be compelled to go into rooms. When hon. Members opposite ask, "Why?", I am suspicious that some of them would be in favour of that sort of thing happening.
  Striking a balance is not easy, but I have never known a municipal housing account to be balanced without contributions from the general ratepayers. Who is the general ratepayer? He is the person who, in due course, will qualify for a council house himself and he will get the benefit of the contributions to the housing account. [Laughter.] Some hon. Members opposite think that this is a laughing matter. It is a tragedy that some hon. Members opposite have not had to live in the types of houses which I have seen and, indeed, in which I myself have lived. I lived in a single end.
  I was happy to get it when I was married; it was what we call a single end. Obviously, that is foreign language to hon. Members opposite. They probably lived in mansion houses. I never have, and I can speak, therefore, with some human experience of a human problem, a problem which is absolutely foreign to their way of life.
  The laughter and derision of the Opposition tonight shows that there are two worlds, and their world is very different from mine. In my world, houses should be built to up-to-date standards, properly maintained, and be let at rents which people can afford to pay. It is as simple as that. To that end, I hope that the Amendment will be rejected. The Opposition's proposal is that, if rents are not increased beyond 7s. 6d., the repair and maintenance of municipal houses will suffer and they will fall into neglect. That is the sort of propaganda which we have

  539
  had from the Front Bench opposite, without a shred of evidence to justify it.
  Our case is a good one, and I am sure that the Government will reject the Amendment.
  Mr. Allason: I am not sure whether the hon. Member for Coatbridge and Airdrie (Mr. Dempsey) heard the Minister's winding-up speech on the last Amendment. It appears that he did not, since he said that housing repair accounts have always been flourishing and that repairs are always carried out.
  Mr. Dempsey: Yes.
  Mr. Allason: But the Minister has been advising councils that they must look forward to see how they can meet a deficit. We are speaking here of a deficit, and he suggested that the housing repairs account is a suitable account to dip into to try to balance the budget.
  Mr. Dempsey: There has always been a deficit in most municipal housing accounts. That has been so in all those of which I have had experience. I was arguing that there would always be one, and, therefore, striking a fair rent could be a difficult problem.
  Mr. Allason: The hon. Gentleman is muddling up a deficit and a contribution from the rate fund. I agree that there is a contribution from the rate fund, but, normally, housing repair accounts remain in credit. It is only sensible that they should, and carry forward a substantial credit from year to year. But the Minister says, "Let us dip into that credit and run down the housing repairs account to nothing". That is a false economy.
  Dr. Dickson Mabon: I did not say that.
  Mr. Allason: As my hon. Friend the Member for North Angus and Mearns (Mr. Buchanan-Smith) said, costs are rising all the time. It is not now a matter of trying to cut down the housing repairs account. It is a matter of building it up. One does not carry out a continual stream of repairs, regularly balanced year by year. Very often, a local authority will prefer to do its painting in one year, perhaps one year in seven, and in that case there may well be in the near future a heavy drain on the account.
  540
  I understand much better the objection of the hon. Member for Birmingham, Aston (Mr. Julius Silverman). He fears that the Amendment will be an excuse for saying that, as a particular house—
  The Temporary Chairman (Miss Harvie Anderson): Order. I hope that the hon. Gentleman will not try the Chair too far. We seem to be straying backwards a little, which would not be correct procedure.
  Mr. Allason: I am sorry, Miss Harvie Anderson. I was speaking of the interjection by the hon. Member for Aston on this Amendment, not of his speech on the previous occasion. He fears that the Amendment would be used as an excuse for increasing rents because a particular house needed repairs. I see that, but I do not think that that is the purpose of the Amendment, which is to meet the Minister's very point. When he says that the repairs account should be dipped into, we say that it should not, that if it is to be run down it should be possible to replenish it by an increase in rents. I think that it means no more than that.
  Housing repairs are essential. It is crazy to suggest that now is the time to economise on maintenance. We all know that if we economise on maintenance one year we have twice the expense the following year. It is very silly to allow slates not to be replaced and not to do various things, to the great annoyance of the tenant and the destruction of the building. I believe that what the Minister proposes is wrong, and, therefore, the Amendment is necessary.
  9.0 p.m.
  Mr. R. C. Mitchell: I listened with great interest to the speeches of the hon. Members for North Angus and Mearns Mr.Buchanan-Smith) and Hemel Hempstead (Mr. Allason). I agree with much that they said, in that we should not allow our repairs accounts to run down and should not economise on maintenance. But would they kindly send copies of their speeches to the Chairman of the Southampton Housing Committee, who is a Conservative, my opponent at the next General Election?
  The Conservative-controlled Southampton Housing Committee, as a deliberate

  541
  act of policy—nothing to do with a 7s. 6d. or 10s. a week rent increase—has deliberately cut down on repairs over the past year. It has been slashing repair accounts, and so on. Since the Conservatives took over they have done exactly what hon. Members opposite said they should not do.
  Mr. Norman Atkinson: I enter the debate merely to ask for clarification of the arithmetic used, which is somewhat confusing. It was suggested that local authorities would skimp the maintenance of their houses if they were ruthlessly held to a 7s. 6d. rent increase. That seems to be the general burden of the argument. It is somewhat confusing to me, particularly after listening to one hon. Member opposite develop the argument a little further. I take it that the Opposition are also saying that the increases allowed in the Bill should be 12s. 6d. and 15s., as advocated on the Amendment Paper, and that that is official Conservative policy.
  If logic is not strained too far, I also take it that if the figures were 12s. 6d. and 15s. the Bill would be acceptable to the Opposition. That is the logic of the Amendment. If so, are we arguing that the houses would be properly maintained if the figures were 12s. 6d. and 15s., a difference of 7s. 6d. as compared with the sums discussed tonight? I assume that we can quantify the matter in this way. It is unfair for Conservative hon. Members to condemn the arithmetic of the Greater London Council for instance—
  Mr. Costain: Can the hon. Gentleman say where the 12s. 6d. and 15s. appear?
  Mr. Atkinson: Amendment No. 12, under the names of Mr. Peter Walker, Mr. Graham Page and Mr. Christopher Chataway, says that the sums of 12s. 6d. and 15s. should be inserted in the Bill. If they are serious—
  The Temporary Chairman (Miss Harvie Anderson): I think the hon. Gentleman must have made an error in quoting an Amendment which has not been called. We are discussing a proposition made in Amendment No. 2.
  Mr. Atkinson: I accept that, Miss Harvie Anderson, but the only way in which we can elicit information is to
  542
  quote figures in the documents before us or in other documents, where it is plainly stated that if those sums of 12s. 6d. and 15s. were inserted the Bill would be acceptable to the Opposition.
  The conclusion I draw from this is that the Opposition are condemning the leadership of the G.L.C. for asking for anything up to 38s. per week in order adequately to maintain its properties. The Opposition are saying here that the G.L.C. is incompetent and has no knowledge of the cost of maintenance or of its own housing problems, and that the astronomical increases it has recommended do not represent reality. In effect, they are saying to the G.L.C, "You were wrong in your original assumption in asking for astronomical increases in London rents, and London authorities should be restrained to the levels of 12s. 6d. and 15s. per week."
  The Opposition are arguing, presumably, that, if these figures were applicable to London, they meet the need as far as the housing revenue account is concerned. I think it improper for them to come here with these well-thought-out figures condemning the Conservative leadership of the G.L.C.
  Mr. Christopher Chataway: Since the hon. Gentleman's observations are based on a misconception perhaps I may explain the situation to him. We made it clear on Second Reading that we are opposed in principle to the control of rents by the central Government and that we believe it should rest with the local authorities. Equally, it has been made clear that we believe that the G.L.C. is behaving entirely reasonably in basing its rents in the long term upon a fair rents principle and that to move by gradual stages over three years to a fair rents principle is a reasonable objective. So there is no question of this or any subsequent Amendment being construed as a criticism of the policy followed by the G.L.C.
  The Temporary Chairman: Order. The debate is ranging considerably wider than the scope of Amendment No. 2 and I hope that we can now return to its narrower terms.
  Mr. Atkinson: I accept that, Miss Harvie Anderson. What the Opposition are now saying is that their Amendments

  543
  are a frivolous exercise and were never intended to be serious. We either accept the seriousness of their case on Second Reading or the seriousness of their Amendments. It is either one or the other. We either accept the seriousness of the figures provided for us by the G.L.C. or accept these well-thought-out figures of 12s. 6d. and 15s.
  The Opposition seem now to be saying that there should be a ceiling on rents throughout the country. But if, on Second Reading, they said that this should be left entirely to the local authorities concerned, do I take it that they mean that here should be no ceiling whatever on rents and that the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) was wrong in suggesting that some amount should be made available in order that there may be effective repairs of the property?
  Mr. Lawler: I was interested to hear from the hon. Member for Coatbridge and Airdrie (Mr. Dempsey) of the excellent state of maintenance of public sector houses in his area. He gave the example of the council moving out one tenant, improving the property and putting another tenant in, and so on. This is being done on a wide scale and perhaps helps to answer the point raised in the Amendment, which is certainly applicable to it, that such action by a local authority will be outside the scope of the Bill in relation to the new rents it will be allowed to impose and will, therefore, give it an enhanced income to help maintain its houses. The letting of properties which had been made vacant for improvements would rank as a new letting.
  I find it difficult to follow what is meant by "proposed maintenance". It has been rightly said that many prudent local authorities undertake extensive maintenance operations once every five, six or seven years and each year they allow out of their repairs account a sum of money to meet that ultimate expense. In the example of the Midlands authority with which I am connected this sum is £22 a year per dwelling. It would seem to be prudent for housing revenue accounts and repairs accounts, which go together in their implications in this subject, to be allowed to retain this money to carry out repairs which are guaranteed
  544
  in stages and which, for at any rate large authorities, would be for large groups of tenants in the public sector.
  I take it that in requiring further information to be furnished to him when any application is made for such increases the Minister would take this factor into consideration to see whether there were sufficient reserves created to allow for delayed periodical expenditure in any one, or two or three consecutive years. But can the Committee be given further information about the term "proposed maintenance"? It is accepted that it is the duty of local authorities to keep all houses in the public sector in a good state of maintenance and they make provision to do so, but what additional financial expenditure is expected to justify the terms of the Amendment?
  Mr. Albert Booth: You rightly indicated to us, Miss Harvie Anderson, that the terms of the Amendment were narrow, but within those narrow terms an important issue is at stake. If the Amendment were carried, it would run against the whole purpose of the Bill, which is to control rent increases and to do so in specific terms. The Bill relates a rent increase to the expenditure which local authorities spend on administration and interest charges and to increases attributable to maintenance works carried out, but the Amendment proposes to extend the level of rent increases to cover maintenance which it is proposed to carry out.
  For a number of local authorities this would be a serious factor. We have reached a stage in the public ownership of housing by local authorities when many municipal houses are due for major maintenance work, one might almost say a major overhaul. This results from the need not only to repair the houses to their original standard, but to bring them up to standards acceptable in modern housing conditions, the desirable standards which local authorities have set them selves.
  In these circumstances, local authorities are examining their older council houses and reviewing the work which will have to be undertaken to bring them up to those desirable standards, and their costing clerks are working out the cost, which for many of the older houses will be considerable, perhaps as high as between

  545
  £200 and £400 per house. If the Amendment were carried, local authorities could impose considerable increases of rent in advance of carrying out extensive work of that nature.
  9.15 p.m.
  I wonder whether the proposers of the Amendment are serious. Would they grant to anyone who had the power, normally controlled by legislation, the right to increase charges on a proposal stating that at some undefined date in the future some requirement would be carried out, which is not even defined by Statute? Proposed maintenance could mean that it is proposed to be done in three years hence. Even the specific obligation to maintain in practical terms is not defined. It runs counter to the intentions of the Bill. Although it is not as narrowly drawn as I would wish, the Bill allows certain increases in respect of maintenance, and I hope the Committee will reject the Amendment.
  Mr. Costain: The speech by the hon. Member for Barrow-in-Furness (Mr. Booth) has really let the cat out of the bag. The question before the Committee is: is it the duty of any local authority to burden the general ratepayers with the extra costs of maintaining houses or should, as hon. Members opposite say, a local authority neglect the maintenance of a house? Those are the alternatives. The hon. Member has suggested that the Bill is designed to keep down basic rents. We on this side know the reason for the Bill, the Government hope to get some votes from the tenants of council houses. I hope that every ratepayer reads that speech and appreciates what is behind that legislation.
  Mr. R. B. Cant: May I make a constructive suggestion—that hon. Members opposite pay a visit to Stoke-on-Trent, in which my constituency lies? We have never skimped on repairs there. We have increased the amount allocated to repairs but we have not increased the rent of council houses for the past five years.
  Mr. R. W. Brown: The hon. Member for Folkestone and Hythe (Mr. Costain) has not mentioned that since 1968 many Conservative councils have deliberately divested themselves of maintenance
  546
  responsibility. They have put the whole onus for inside maintenance of the house upon the tenant. Yet they have still increased the rent. They have behaved in the most abominable fashion. The attitude of the G.L.C. over the past two years has been deplorable. Any London Member can tell the hon. Member how difficult it is to get the G.L.C. to carry out necessary work of ordinary maintenance, such as dampness. It refused to do this, even though it has increased the rents.
  The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Reginald Freeson): If this debate has gone rather wide of the terms of the Amendment it is largely due, I am afraid, to the rather imprecise way in which the Amendment is worded and the way in which it has been argued. To some extent I suspect that it is due to some misunderstanding on the part of the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) of the way in which local authorities operate their repairs policies and manage their housing repairs funds.
  I am confirmed in that view by the rather inadequate contribution of the hon. Member for Folkestone and Hythe (Mr. Costain). He made no mention of the housing repairs fund. When we are talking about annual expenditure on maintenance of housing estates by local authorities we are talking about sums of money being drawn from a fund, and not about a current contribution being spent on an equivalent basis. There is money going into a fund, and over five- or seven-year cycles it is being withdrawn and spent on repairs. Anything done this year or next is based upon contributions built up over a period of years.
  In that connection, the point made by my hon. Friend the Member for Shoreditch and Finsbury (Mr. R. W. Brown) is valid, because some authorities—I hope that they will not pursue the policy too far—have cut back their responsibilities for maintenance, although money has been provided over previous years to enable that maintenance to be carried out in this year or next year.
  The Amendment refers to annual increases of rent being related to past or prospective increases in the cost of maintenance and in so doing it shows a basic

  547
  misunderstanding of how local authorities finance the maintenance of their houses. It has been suggested that the Bill could be damaging to the prospect of major works on some of the older estates, and that comment led other hon. Members to go wider in criticism of the Bill. But the Bill explicitly separates the issue of modernisation and improvement of some of the very old, immediately post-First World War, council estates from the issue of rent control of any kind. There have been many instances over the years in which local authorities have applied, as private owners have applied, for grants under the relevant Acts, and that number will be largely increased under the 1969 Act, which became law a few months ago.
  It is as well also to point out, in spite of what has been said about repairs funds being run down into the ground, that during the operation of the prices and incomes policy most local authorities have not found it necessary to propose increases larger than the 7s. 6d. which we are giving as a guide line.
  Mr. Allason: If the hon. Member had listened to the speech of the Minister in the last debate he would have heard him refer specifically to the running down of housing repairs funds.
  Mr. Freeson: The hon. Member must re-read that speech.
  Mr. Allason: No. The Parliamentary Secretary must re-read it.
  Mr. Freeson: I happen to know a little more about the operation of housing repairs funds than does the hon. Member.
  As was suggested in the report of the National Board for Prices and Incomes, where substantial balances—I am not referring to current contribution levels—have been built up by local authorities in the administration of their housing departments, we have said that these should be looked at, but it has been the Government's policy while this control has been operated not to take account of working balances, which is the money with which we are mainly concerned in managing housing repairs funds. There is no instance in which we have said to a local authority that it must cut back its working balances—the figures on which the five- or seven-year cycle of works is
  548
  carried out—so as to destroy those balances in order to maintain a lower rent level. Not one hon. Member opposite has produced evidence to show that we have made such a request upon the G.L.C. or upon anyone else.
  I stress that the rent control policies being pursued must take account of all the factors. To single out one factor such as maintenance costs over the past and the future—in the terms of the Amendment, the indefinite past and the indefinite future—would be pointless, because any rent increases and any review of rent policy should relate to a whole series of factors which give rise to the cost of managing housing estates.
  It is no more right to single out the factor suggested in the Amendment than to single out any other factor and to say that it should be excluded from the consideration of rent control. The reasoning behind the Amendment is unsound, though I willingly accept the motivation which led some hon. Members to be concerned that we should not so conduct our affairs in Government or local government as to destroy the sound management of housing repairs funds. I happen to believe that this is a very important part of local government management in the running of housing estates. I certainly would not be a party to their destruction. It is not the policy of the Government or the purpose of the Bill so to do.
  Mr. Peter Walker: For a Parliamentary Secretary who boasts of his superior knowledge in these matters, that was a remarkably bad and incompetent speech. We are told that the trouble with the Amendment is that it is indefinite both as to the past and as to the future. If the hon. Gentleman looks at the Bill, he will see that subsection (4) of the Clause, dealing with improvements, is also indefinite as to the past and as to the future.
  If the hon. Gentleman understood the Amendment or bothered to read it, he would realise that all that it tries to do is to add to the question of improvements the question of maintenance and repair. This is something that the Government should have done. Therefore, the hon. Gentleman's complaint that the Amendment is indefinite is a valid complaint against the wording of subsection (4).

  549
  We have been given the remarkable argument that it is the normal practice of local authorities to fund their repairs account year by year and that we should, therefore, take no notice of what might happen. Let us look, however, at the types of increase to which the repairs accounts will be subjected. Those who originally decided the basis of funding maintenance and repairs accounts could not have known that the Government would introduce the selective employment tax, with all its impact—and the recent changes in that tax have had a further impact. Similarly, nobody operating the funding of such accounts could have taken into consideration the suggested pay award for the building industry involving a 26 per cent. increase in the period to 1971. Here are simply two factors which have a considerable impact upon the cost of maintenance and repairs.
  It is remarkable that none of the arguments from the back benches opposite showed any recognition of what the Amendment seeks to do. It merely tries to say that in the same way as one takes into account the cost of improvements—and they are excluded by subsection (4)—one should also take into account the additional cost of maintenance.
  If the Government go into the Lobby against the Amendment, they will be saying that they are in favour of improvements not being taken into account. That was the point which was raised with some concern by the hon. Member for Barrow-in-Furness (Mr. Booth). If he looks at subsection (4), he will find that the point to which he referred is Government policy. Therefore, the hon. Member had better vote against the Bill. We say that maintenance and repairs should be taken into a calculation in exactly the same way as the Government suggest that improvements should be taken into account.
  Mr. Booth: The point that I was making—I apologise if I did not make it clearly—was that in maintaining very old houses there is inevitably an element of improvement because they are not repaired to the original standard. Therefore, in those improvements, maintenance grants would not be involved.
  Mr. Walker: I am grateful to the hon. Member for reinforcing my argument still further.
  550
  The Government are saying in subsection (4) of the Clause that
  "An increase in the rent for a house is excepted from the provisions of this section if it is attributable to improvements".
  We say that to that should be added maintenance as well. In the terms of his argument, therefore, the hon. Member for Barrow-in-Furness is at one with us and we look forward to seeing him in the Lobby with us.
  We are suggesting that the increased costs of both repairs and improvements should be taken into consideration. The Government have done more to increase the costs of both repairs and improvements than any Government in history. Therefore, in the light of the Government's record, this is a reasonable Amendment for them to accept.
  [Mr. HARRY GOURLAY in the Chair]
  9.30 p.m.
  As to the points made by the hon. Member for Coatbridge and Airdrie (Mr. Dempsey) about the importance of rate support to rents, and how important it is to keep rents low rather than to put them up, I gathered that in Coatbridge there is a deficit on housing account on which the subsidy by the ratepayers is considerable. If that is his principle and policy, I accept that.
  Mr. Dempsey: I said that I believed in a fair rent, but it is difficult to have a fair rent when there is a rent contribution to the housing account. I would remind the hon. Member that only this year my local authority increased rents by 5s. a week, the other authority by 4s. 6d. a week.
  Mr. Walker: If the hon. Member means by fair rent the definition by his own Government of fair rent, we welcome him as a convert to our cause and are delighted to have him on our side. We accept "fair rent" as defined by the Labour Government in the Rent Act, and we say that those who cannot afford it should receive a rebate to meet their problem. If the hon. Member is a convert, then we have two converts, the hon. Member for Barrow-in-Furness and the hon. Member for Coatbridge and Airdrie, and we shall welcome them in our Division Lobby, and, perhaps, with the assistance of those two—
  Mr. Atkinson: I should not like the hon. Member to finish his speech without defining his own point of view. Does he honestly believe that there should be a maximum figure for these increases, or that the figure should be left free and no limit mentioned? Which is it?
  Mr. Walker: I make it perfectly clear that I accept the Labour Government's definition of a fair rent. I am all in favour of having fair rents applied in both the public and the private sector, and all in favour of seeing that those who cannot afford the rents receive an appropriate rebate.That is my policy.As
  for these increases, for those families who cannot afford to meet the fair rent I am in favour of a proper rebate. That is the policy of this side of the Committee, and I hope that it will eventually —after years of persuasion—become the policy of that side of the Committee so that we shall have more than two converts. Meanwhile, we shall divide the Committee.
  Question put, That the Amendment be made: —
  The Committee divided: Ayes 131, Noes 192.

  Division No. 16.]

  AYES

  [9.33 p.m.

  Allason, James (Hemel Hempstead)

  Hall-Davis, A. G. F.

  Percival, Ian

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

  Hamilton, Michael (Salisbury)

  Pike, Miss Mervyn

  Baker, W. H. K. (Banff)

  Harrison, Brian (Maldon)

  Pink, R. Bonner

  Balniel, Lord

  Harrison, Col. Sir Harwood (Eye)

  Pounder, Rafton

  Bennett, Dr. Reginald (Cos. & Fhm)

  Hastings, Stephen

  Prior, J. M. L.

  Biffen, John

  Hawkins, Paul

  Pym, Francis

  Boardman, Tom (Leicester, S.W.)

  Heald, Rt. Hn. Sir Lionel

  Ramsden, Rt. Hn. James

  Body, Richard

  Heseltine, Michael

  Rhys Williams, Sir Brandon

  Boyd-Carpenter, Rt. Hn. John

  Higgins, Terence L.

  Rodgers, Sir John (Sevenoaks)

  Boyle, Rt. Hn. Sir Edward

  Hill, J. E. B.

  Rossi, Hugh (Hornsey)

  Brewis, John

  Hogg, Rt. Hn. Quintin

  Russell, Sir Ronald

  Brown, Sir Edward (Bath)

  Holland, Philip

  St. John-Stevas, Norman

  Bruce-Gardyne, J.

  Hornby, Richard

  Scott-Hopkins, James

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

  Hunt, John

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

  Buck, Antony (Colchester)

  Jenkin, Patrick (Woodford)

  Silvester, Frederick

  Bullus, Sir Eric

  Jennings, J. C. (Burton)

  Sinclair, Sir George

  Campbell, B. (Oldham, w.)

  King, Evelyn (Dorset, S.)

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

  Campbell, Gordon (Moray & Nairn)

  Kitson, Timothy

  Smith, John (London & W'minster)

  Carlisle, Mark

  Lancaster, Col. C. G.

  Stainton, Keith

  Cary, Sir Robert

  Lane, David

  Stoddart-Scott, Col. Sir M.

  Chataway, Christopher

  Legge-Bourke, Sir Harry

  Summers, Sir Spencer

  Clegg, Walter

  MacArthur, Ian

  Taylor, Frank (Moss Side)

  Cooke, Robert

  Maclean, Sir Fitzroy

  Temple, John M.

  Corfield, F. V.

  McMaster, Stanley

  Thatcher, Mrs. Margaret

  Costain, A. P

  McNair-Wilson, Michael

  Tilney, John

  Craddock, Sir Beresford (Spelthorne)

  Maddan, Martin

  van Straubenzee, W. R.

  Crowder, F. P.

  Maginnis, John E.

  Vaughan-Morgan, Rt. Hn. Sir John

  Cunningham, Sir Knox

  Mawby, Ray

  Waddington, David

  Currie, G. B. H.

  Maxwell-Hyslop, R. J.

  Walker, Peter (Woroester)

  Dalkeith, Earl of

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

  Walker-Smith, Rt. Hn. Sir Derek

  Dance, James

  Mills, Stratton (Belfast, N.)

  Ward, Christopher (Swindon)

  Dean, Paul

  Miscampbell, Norman

  Ward, Dame Irene

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

  Mitchell, David (Basingstoke)

  Weatherill, Bernard

  Dodds-Parker, Douglas

  Monro, Hector

  Wells, John (Maidstone)

  Eden, Sir John

  Montgomery, Fergus

  Whitelaw, Rt. Hn. William

  Elliot, Capt. Walter (Carshalton)

  Morgan, Geraint (Denbigh)

  Wiggin, A. W.

  Eyre, Reginald

  Mott-Radclyffe, Sir Charles

  Williams, Donald (Dudley)

  Farr, John

  Munro-Lucas-Tooth, Sir Hugh

  Wolrige-Gordon, Patrick

  Fortescue, Tim

  Nabarro, Sir Gerald

  Worsley, Marcus

  Foster, Sir John

  Neave, Airey

  Wylie, N. R.

  Clover, Sir Douglas

  Nicholls, Sir Harmar

  Cower, Raymond

  Nott, John

  TELLERS FOR THE AYES:

  Grant-Ferris, Sir Robert

  Page, Graham (Crosby)

  Mr. Jasper More ard

  Griffiths, Eldon (Bury St. Edmunds)

  Page, John (Harrow, W.)

  Mr. Anthony Grart

  Gurden, Harold

  Peel, John

  NOES

  Albu, Austen

  Bennett, James (G'gow, Bridgeton)

  Broughton, Sir Alfred

  Allaun, Frank (Salford, E.)

  Binns, John

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

  Alldritt, Walter

  Blackburn, F.

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

  Anderson, Donald

  Blenkinsop, Arthur

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

  Atkins, Ronald (Preston, N.)

  Boardman, H. (Leigh)

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

  Atkinson, Norman (Tottenham)

  Booth, Albert

  Butler, Herbert (Hackney, C.)

  Bacon, Rt. Hn. Alice

  Boston, Terence

  Butler, Mrs. Joyce (Wood Green)

  Baiter, William

  Bottomley, Rt. Hn. Arthur

  Cant, R. B.

  Beaney, Alan

  Boyden, James

  Carmichael, Neil

  Bence, Cyril

  Bradley, Tom

  Carter-Jones, Lewis

  Chapman, Donald

  Hughes, Roy (Newport)

  Newens, Stan

  Coleman, Donald

  Hunter, Adam

  Norwood, Christopher

  Concannon, J. D.

  Jay, Rt. Hn. Douglas

  Oakes, Gordon

  Conlan, Bernard

  Jenkins, Hugh (Putney)

  O'Halloran, Michael

  Da yell, Tarn

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

  Orbach, Maurice

  Darling, Rt. Hn. George

  Johnston, Russell (Inverness)

  Oswald, Thomas

  Davidson, Arthur (Accrington)

  Jones, Dan (Burnley)

  Owen, Will (Morpeth)

  Davies, Ednyfed Hudson (Conway)

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

  Page, Derek (King's Lynn)

  Dailies, G. Elfed (Rhondda, E.)

  Jones, J. Idwal (Wrexham)

  Pannell, Rt. Hn. Charles

  Davies, S. O. (Merthyr)

  Jones, T. Alec (Rhondda, West)

  Park, Trevor

  Dempsey, James

  Judd, Frank

  Pavitt, Laurence

  Dewar, Donald

  Kelley, Richard

  Pearson, Arthur (Pontypridd)

  Dickens, James

  Kerr, Russell (Feltham)

  Pentland, Norman

  Dobson, Flay

  Lawler, Wallace

  Perry, Ernest G. (Battersea, S.)

  Doig, Peter

  Lawson George

  Perry, George H. (Nottingham, s.)

  Dunnett, Jack

  Prentice, Rt. Hn. Reg.

  Dunwoody, Mrs, Gwyneth (Exeter)

  Leadbitter, Ted

  Price, Thomas (Westhoughton)

  Eadie, Alex

  Lee, Rt. Hn. Jennie (Cannock)

  Probert, Arthur

  Edwards, Robert (Bilston)

  Lee, John (Reading)

  Rankin, John

  Edwards, William (Merioneth)

  Lestor, Miss Joan

  Richard, Ivor

  English, Michael

  Lewis, Arthur (W. Ham, N.)

  Roberts, Albert (Normanton)

  Ennals, David

  Lewis, Ron (Carlisle)

  Roberts, Rt. Hn. Goronwy

  Ensor, David

  Lubbock, Eric

  Roberts, Gwilym (Bedfordshire, S.)

  Evans, Fred (Caerphilly)

  Lyon, Alexander W. (York)

  Robertson, John (Paisley)

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

  Lyons, Edward (Bradford, E.)

  Ross, Rt. Hn. William

  Ewing, Mrs. Winifred

  Mabon, Dr. J. Dickson

  Ryan, John

  Faulds, Andrew

  McBride, Neil

  Shaw, Arnold (llford, S.)

  Fernyhough, E.

  McCann, John

  Silverman, Julius

  Finch, Harold

  MacColl, James

  Small, William

  Fitch, Alan (Wigan)

  MacDermot, Niall

  Spriggs, Leslie

  Fletcher, Raymond (Ilkeston)

  McElhone, Frank

  Steele, Thomas (Dunbartonshire, W.)

  Fletcher, Ted (Darlington)

  McGuire, Michael

  Swain, Thomas

  Foot, Michael (Ebbw Vale)

  Mackenzie,Alasdair(Ross&Crom'ty)

  Taverne, Dick

  Forrester, John

  Mackenzie, Gregor (Rutherglen)

  Thomas, Rt. Hn. George

  Fowler, Gerry

  Mackie, John

  Tinn, James

  Freeson, Reginald

  Maclennan, Robert

  Varley, Eric G.

  Galpern, Sir Myer

  McMillan, Tom (Glasgow, C.)

  Wainwright, Edwin (Dearne Valley)

  Gardner, Tony

  McNamara, J. Kevin

  Wainwright, Richard (Colne Valley)

  Golding, John

  MacPherson, Malcolm

  Walker, Harold (Doncaster)

  Gregory, Arnold

  Mahon, Simon (Bootle)

  Watkins, David (Consett)

  Grey, Charles (Durham)

  Mallalieu, E. L. (Brigg)

  Watkins, Tudor (Brecon & Radnor)

  Griffiths, Eddie (Brightside)

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

  Weitzman, David

  Hamilton, James (Bothwell)

  Mapp, Charles

  Wellbeloved, James

  Hamilton, William (Fife, W.)

  Marks, Kenneth

  Wells, William (Walsall, N.)

  Hamling, William

  Mason, Rt. Hn. Roy

  Wilkins, W. A.

  Hannan, William

  Mellish, Rt. Hn. Robert

  Wiliey, Rt. Hn. Frederick

  Harrison, Walter (Wakefield)

  Miliar], Bruce

  Williams, Clifford (Abertillery)

  Haseldine, Norman

  Miller, Dr. M. S.

  Willis, Rt. Hn. George

  Hazell, Bert

  Milne, Edward (Blyth)

  Winnick, David

  Henig, Stanley

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

  Woodburn, Rt. Hn. A.

  Hilton, W. S.

  Molloy, William

  Woof, Robert

  Homer, John

  Morris, Alfred (Wythenshawe)

  Howell, Denis (Small Heath)

  Morris, Charles R. (Openshaw)

  TELLERS FOR THE NOES:

  Howie, W.

  Morris, John (Aberavon)

  Mr. Ernest Armstrong and

  Hoy, Rt. Hn. James

  Moyle, Roland

  Mr. Joseph Harper.

  Huckfield, Leslie

  Neal, Harold

  Clause 1 ordered to stand part of the Bill.

Clause 2

  LIMITS OF UNRESTRICTED INCREASES
  Question proposed, That the Clause stand part of the Bill.
  Mr. chataway: Clause 2 sets the limits for average increases and maximum increases for each local authority. It is this part of the Bill which pre-eminently perpetuates a situation in which subsidies are paid alike to those who need them and those who do not. This is the Clause which principally will perpetuate a situation in which people are worse
  554
  off will be subsidising those who are better off than they are. This is the feature of the Bill to which we object most strongly.
  It was suggested earlier by the hon. Member for Tottenham (Mr. Atkinson) that we on this side would be happier with the Bill if a higher limit were set. This is not the case. We believe that local authorities should have the freedom to determine their own rents. As we understand it, that is the policy of the Government. They believe that in the long term local authorities should have this freedom restored to them.
  Perhaps hon. Gentlemen opposite will consider one or two of the consequences of the Clause. It was admitted by the Minister of State, Scottish Office, earlier

  555
  that there are a number or alternatives if a local authority does not want to put up rents. He said that in his view they were bad alternatives. A local authority could either defer repairs or else cut down on new housing. He said that although they were bad alternatives, perhaps they were not so bad as to be ruled out in all cases.
  Dr. Dickson Mabon Dr. Dickson Mabon indicated dissent.
  Mr. Chataway: I apologise if the Minister of State did not say that. That was the implication of his remarks as I understood them.
  The undoubted effect of the Government's policy is to deter new council building. We are so used to the Government so often achieving the opposite from what they intend, but in a case such as this, if local authorities see the burden increasing on the ratepayer as a result of Government policy, they must be deterred from new council building. I hope that in view of the figures from the Ministry of Public Building and Works yesterday, showing that the value of public sector housing orders fell back by 26 per cent. during the first nine months of this year, the Government will have second thoughts about their policy.
  9.45 p.m.
  When The Times states that a joint N.E.D.C. report forecasts that the value of output in public housing, calculated on constant prices, will fall by 4½ per cent. in 1969, by a further 1 per cent. in both 1970 and 1971 and by a full 6 per cent. in 1972, hon. Members opposite should stop and think about the consequences of the policy they are pursuing; and realise that unless local authorities are allowed so to increase rents as to contain the burden upon the ratepayer some fall in new housing is bound to result.
  Without wishing to detain the Committee, I wish to make a further point relating specifically to the Greater London Council, since that body has been mentioned by a number of hon. Members. Some local authorities will be able to achieve a perfectly satisfactory state of affairs within modest increases in rent —their predecessors over the years will, perhaps, have pursued a rent policy fair both to tenant and ratepayer. This is has not been the situation in London.
  556
  In 1964, the district auditor had to draw the attention of the L.C.C. to the fact that its rents ought from time to time to be related to rents in the private sector, and chided the L.C.C. for failing to review its rents at regular intervals. That is the background against which the G.L.C. has had to operate. In that situation, it is facing an undesirable restriction to an average rent increase of 7s. 6d., and a maximum of 10s., as the Clause lays down.
  In an article in Housing last September, Mr. Macey, the G.L.C. Director of Housing, who has served both parties with considerable distinction, drew attention to the particularly undesirable limitation imposed by this 10s. maximum. He said:
  "… with a maximum of 10s. the gap here between the average and the maximum is too narrow and must be a handicap to the practical aplication of increases over the whole range of sizes of dwellings and types of dwellings owned by local authorities. It would be much more practical to say that the average of 7s. 6d. should be set against a maximum of 12s. 6d."
  That example of an authoritative view shows the kind of distortions and anomalies that are produced by a Clause of this kind. I therefore hope that the Committee will recognise that we on this side view the terms of the Clause with the gravest misgivings.
  Mr. Freeson: The hon. Member for Chichester (Mr. Chataway) made a number of observations about the position of the housing programme and its prospects, but he must know that the Bill relates to the rents of existing properties and therefore has no relationship —[Interruption.]—It might be helpful if hon. Members were to listen to points before commenting on them—to the housing programmes as such, nationally, because he knows, as I know, that they are not subject to the figures written into the Bill.
  I will go further. No evidence has been brought to show that it has been the policy operated so far under the Prices and Incomes Act, and now proposed under the Bill, that has caused any slow down in the whole housing programme in the public sector. Other financial difficulties have been quoted in discussion and in public, but not this difficulty, although there has been a general objection to the restraints that have been imposed.

  557
  These restraints have been imposed in this Bill as part of the general economic position, not just on the basis of considering the position of local authorities and their housing estates as such. It is not only in this part of the economy that we have sought to apply restraints of one kind or another in prices and incomes policy. To single out this part as one which should not be treated as other fields of policy are treated would be grossly unfair bearing in mind the important part which rent levels plays in the economy of the country.
  I resist the temptation to make a comment on the cut-back by local authorities in their housing programmes. The hon. Member showed himself a little too sensitive in coming too quickly on too many occasions to the defence of his party on this score. We hope to have discussions with the authority with which he is connected and others to see if we can get over difficulties in this matter. I hope that the time will come very soon when public authorities such as that with which he has been associated for many years and other local authorities will step up their housing programmes as is the wish of the Government. There is no ceiling to priority areas in this country.
  Turning to the kind of level we have set in this Bill, I repeat what I said in discussion of the earlier Amendment. On the basis of our experience in the operation of the current Prices and Incomes Act, the vast majority of authorities have operated satisfactorily their rent policy in the terms and spirit of that Act. On the basis of the kind of figures we have had as to the number of authorities which have had rent increases varying from 2s. 6d. to 5s. or 7s. 6d. over the past period when we have operated under the Act, we have no grounds for believing that the kind of voluntary agreement negotiated with the local authority association';—I accept the exclusion of the G.L.C.— will not be operated in the spirit in which it was established and in which it is incorporated in this Measure.
  I am increasingly mystified as to why hon. Members opposite continue to persist in undue criticism of a policy which has been pursued with reluctance, as all concerned with prices and incomes levels do show reluctance, but nevertheless they have agreed to such a policy in negotia-
  558
  tions. That was the agreement and I should have hoped that this Committee would operate it.
  Mr. Lubbock: The hon. Member for Chichester (Mr. Chataway) quoted an article by Mr. Macey. I did not read it, but I was interested in the comment because of the implication which lay behind it. If the hon. Member was saying thai in his opinion the average incomes of 7s. 6d. more properly related to a maximum of 12s. 6d. he was accepting the principle behind the Bill. If he was arguing the relationship between the average and the maximum I am surprised that he did not put down an Amendment to change 7s. 6d. to 12s. 6d.
  If Mr. Macey's article made an adequate case for a higher maximum in relation to the average, I do not see now one could put this forward in an article unless one accepted the basis of the principle of the Bill. Mr. Macey's employers have frustrated the prices and incomes policy in the rent sector. But for that we would not be discussing this Amendment, but would be spending time on other matters.
  Mr. Chataway: The article makes it clear that Mr. Macey, in common with most directors of housing, believes it to be entirely wrong for the Government to take away the freedom of local authorities in this sphere. He makes the point that with an average of 7s. 6d. it would be more logical to have a higher maximum.
  Mr. Lubbock: Then why did not the hon. Gentleman table an Amendment to that effect? He could easily have done so.
  Mr. Chataway: We did. It was not called.
  Hon. Members: Withdraw.
  Mr. Lubbock: In that case, why does not the hon. Gentleman argue, in the main debate on the Clause, the merits of the case for a higher maximum? He could have done that. There is nothing to stop him from putting forward arguments of that nature in the main debate.
  The Deputy Chairman (Mr. Harry Gourlay): The hon. Gentleman would have been out of order if he had argued that case.
  Mr. Lubbock: With respect, the hon. Gentleman was discussing some remarks

  559
  of Mr. Macey, Director of Housing of the G.L.C., to the effect that a 12s. 6d. increase was more appropriate than the 10s. increase provided for in the Bill. If you allowed a discussion on that matter, Mr. Gourlay, I do not see why the hon. Gentleman could not have gone into the merits of the argument. However, this is not essential criticism I make of the hon. Gentleman.
  It is a little unfair of the hon. Gentleman to drag a chief officer of housing into a debate in Parliament and quote the views of officers who are not able to make themselves heard personally in Parliament. However, I leave that matter aside. My criticism is not directed to that point.
  I am merely saying that the hon. Gentleman and his friends on the G.L.C. have done Britain a great disservice by provoking a confrontation between local authorities and the central Government which should never have occurred. Most local authorities have been perfectly willing to co-operate in applying the prices and incomes policy, as has everybody else. We may not like it, but we can see its necessity. Boards of big companies and members of trade unions have done their best to co-operate in keeping prices down to sensible levels. The hon. Gentleman and his friends make a series of propositions to the effect that, if a house is painted, the rent can be increased by more than 7s. 6d.—they do not say to what level.
  The whole of the arguments advanced by hon. Gentlemen this evening have been directed to the proposition that rents should increase by much more than the amount prescribed in the Bill. Hon. Gentlemen should be honest and say what they mean. They want the rents of local authority and private tenants to go sky high. We know what hon. Gentlemen mean. Local authority tenants know what they mean. They advocate a policy which would mean in many cases a doubling of rents.
  This is what the hon. Gentlemen and his friends are after, both on the G.L.C. and on other local authorities. I hope that local authority tenants who read the report of these debates will see the truth behind the hon. Gentleman's remarks.
  Mr. Arthur Lewis: I apologise for the fact that I have not attended the debate till now. I have been in my constituency discussing a serious problem connected with the Bill. The Minister may not like my referring to it, but over 18 months ago the Ronan Point disaster occurred. We still have not had from the Ministry any satisfactory resolving of the issue of the payment of compensation to local authorities—
  The Deputy Chairman: Order. This is not the Second Reading debate. This is the debate on the Question, That the Clause stand part of the Bill. It is not connected with Ronan Point.
  Mr. Arthur Lewis: I agree. If you will allow me a few moments, Mr. Gourlay, I want to refer to subsections (4) and (5), which are relevant to this question.
  The Deputy Chairman: There is no subsection (5) in the Clause.
  Mr. Lewis: We are debating the Question, That Clause 1 stand part of the Bill, are we not?
  The Deputy Chairman: No, we are debating Clause 2.
  It being Ten o'clock, The CHAIRMAN left the Chair to report Progress and ask leave to sit again.
  Committee report Progress.

BUSINESS OF THE HOUSE
Ordered,
That the Proceedings on the Rent (Control of Increases) Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Freeson.]

RENT (CONTROL OF INCREASES) BILL
Again considered in Committee.
Question again proposed,That the Clause stand part of the Bill.
Mr. Lewis: I have already apologised for not having had the opportunity to attend this debate all the time. Nevertheless, the points that I am about to make are relevant to Clause 2.
Clause 1 having been agreed to, the Bill permits local authorities, on certain

561
conditions, to increase rents by defined amounts. I was going on to explain that as good a local authority as we have in Newharn—and it is one of the best— will nevertheless find great difficulty in meeting its obligations in carrying out the provisions of this Clause relating to rents because the Government, having made a 40 per cent. grant, have imposed upon the local authority a 60 per cent. charge towards the cost of strengthening tower blocks. Tower blocks are houses within the meaning of Clause 1.
It is laid down that rents may be increased above the suggested amounts in Clause 2 if certain criteria are met. I should like to know what will be the position in areas such as mine, and in other constituencies, if the council says, "We have moved people out of Ronan Point. Some of them are afraid to return and will not go back. But as new tenants are taking over, we have the opportunity of asking for more than the 10s. or the 7s. 6d. average to cover the cost of improvements"—the improvements being the strengthening of tower blocks, which duty is imposed upon local authorities.
Local authorities such as mine will have to apply rents far in excess of the amount specified in the Clause. Otherwise, they will not be able to find the money to carry out the strengthening and other improvements. The Minister may say that they do not have to increase the rents, that they could increase the local rates instead. But this will mean that the people who have already suffered for nearly two years will find their rates going up. The Minister may say that he will not permit the local authority to raise rents above the 10s. or 7s. 6d.
I do not know what the position will be, but the situation as I have described it exists in Newham now. It is not hypothesis. Hundreds of people were moved out of these blocks of flats and they are having second thoughts about going back. That means that new tenants will be taking over. If there are new tenants, and if there are improvements—1 assume that there will be some strengthening eventually and it could be termed improvement—I want to be assured that in an area like mine, and others similarly affected, people will not suddenly find that they have to pay extra rent because
562
they were so unfortunate as to suffer a disaster.
It was not their wish to suffer in that disaster. I have never known an attitude like this to be taken before. After the Aberfan tragedy, the Government rightly footed the bill. But in circumstances such as I have just described, poor local authorities—and they are mainly the poor ones—will be confronted with a 60 per cent. imposed charge. I agree that the Minister is still considering it, but that is how it looks. Goodness knows how long he will be considering it. If I were considering something for 18 months, I should expect a kick in the pants if I did not come to a decision. The Ministry deserves a kick in the pants.
What worries me is this. Will the Bill be used as the vehicle for saying to local authorities like mine "Whether you like it or not, you now have to find the 60 per cent., and we shall give you permission" —which, incidentally, they do not want —"to increase rents above the 10s."? That would be a grave injustice. Unless I have an assurance from the Minister that the Bill will not be used to the disadvantage of authorities such as mine, I shall have grave doubts about supporting the Clause.
I regret that I inadvertently mentioned Clause 1, which has already been agreed, but my point ties in with Clause 2 as well because it is the amount of the rents which particularly concerns me. I hope that hon. Members who have these tower blocks in their constituencies will be aware of the danger which may confront their constituents.
Mr. Freeson: I congratulate my hon. Friend the Member for West Ham, North (Mr. Arthur Lewis) on his ingenuity and the promptitude with which he brought it to bear on this topic. As he said, the Minister is considering the question which he raised. He may think that we are taking too long, but he will appreciate that there have been consultations with the local authority associations concerned. They expressed certain views and made representations on the level of the contribution proposed by the Minister —I do not recall the exact date of the meeting, but it was earlier this year— and those representations are now being considered.

563
As regards the Clause and its relevance to the specific issue put to us in connection with the aftermath of Ronan Point, all I can say is that the Bill, far from precluding them, requires local authorities to apply in respect of any average increase in excess of the 7s. 6d. laid down. I am not seeking to encourage or invite applications; I am merely stating what is laid down in the Bill.
There will therefore, be nothing to prevent a local authority—indeed, it is required in the Bill for the reasons given by the hon. Member for Orpington (Mr. Lubbock) earlier, because of the dispute which arose—to make application and submit the evidence which gives rise to its view that it should have a higher average rent increase in its area.
I cannot go beyond that, except perhaps to mention, since departmentally I have an association with the issue of the Aberfan disaster, that the kind of thinking we have sought to apply to the aftermath of Ronan Point has been very much along the lines of thinking on the role of Government in the aftermath of national disasters. The Government have not taken a 100 per cent. cost burden upon the Exchequer, but they have sought to make a good contribution.
I cannot go into details which would not be relevant tonight, but that was the position with regard to that national disaster, and it was in that spirit that we discussed the matter and made certain recommendations about the Ronan Point situation. Tonight is not the occasion to go further than that. The matter is before my right hon. Friend.
Mr. John Page: When are we likely to know the result of the Ronan Point discussions? The Minister said earlier that it would be this year. When shall we have the answer?
Mr. Freeson: I have just said that in my view this is not a matter for tonight.
Question put and agreed to.
Clause 2 ordered to stand part of the Bill.
Clauses 3 and 4 ordered to stand part of the Bill.

Clause 5

  RESTRICTIONS ON INCREASES IN RENTS UNDER REGULATED TENANCIES
  The Deputy Chairman: The next Amendment selected is Amendment No. 5, with which it may be convenient for the Committee to discuss Amendment No. 9, in the Schedule, page 7, line 5, leave out from 'of' 'to 'one' in line 7.
  Mr. Graham Page: I beg to move Amendment No. 5, in page 4, line 36, leave out 'or 1971 '.
  The Clause provides that when a fair rent has been fixed by a rent officer for a private tenancy it shall not be recoverable for two years if it is fixed during 1970, and one year if it is fixed during 1971. It was the Labour Government of 1965 which put on the Statute Book the procedure for fixing a fair rent. The Government have claimed that it is a rent fair both to landlord and tenant.
  The principle of fair rent was first breached in the Housing Act, 1969, under which landlords who carry out improvements to dwelling houses must wait in some cases four years, and in others as much as six years, before receiving what has already been declared to be a fair rent. Those were special cases, but now in the Bill the principle of fairness is breached with respect to all private tenancies. The provisions of the Clause, coupled with the Schedule, forbid a landlord recovering from the tenant for a period of time the rent fixed as fair by an independent person—the rent officer —and perhaps even an independent committee—the rent assessment committee.
  Our Amendment says in effect that if the Government's policies make it necessary that a tenant shall not be charged the fair rent for a period of a year, and the Government are likely to remain in office for that period, we had better have that provision, but that a year is long enough. The Bill should not extend its effect beyond 1970, and rents declared to be fair rents in 1971 should be recoverable by the landlord at once. If the Bill is necessary, it is the Government's actions that have made it so. It should not require the landlord to pay for the Government's failures of policy.
  10.15 p.m.
  The Minister of State, Ministry of Housing and Local Government (Mr. Denis Howell): The Amendment seeks to remove the protection which the Government think that tenants of private landlords need in 1971 and possibly 1972. Under our proposals, the fair rent increase;: agreed have to be phased, and I do not think that the Opposition are proposing that a fair rent should be paid at once and in full, for the obvious reason that, in this part of the Bill and by the new proposals for rent officers and so on, we are trying to strike a fair balance between landlord and tenant.
  But we recognise that, because one has has to take account of the starting point of the operation—the rent being paid before the fair rent was established—after the fair rent has been established, unfortunately, as some of my hon. Friends would think, the difference between the existing rent and the fair rent is very steep in many cases and it would, therefore, be monstrous to say that there should be no phasing and no protection against the automatic implementation of the fair rent.
  If we omitted the words "or 1971", the effect would be that, although one third of the increase would be paid in 1970, the other two-thirds would have to be paid in 1971, or, if the new fair rent was registered in 1971, the whole increase would have to be paid on that account. This would be a monstrous pro-
  posal in the case of many tenants whose budgets are geared to their existing rent. Although we believe it right, since we enunciated the principle of fair rents— something the Opposition did not attempt to do when in office—and are trying to get the balance right, to do it in a reasonable and civilised manner, and it would create considerable hardship in the lives of many tenants and their families if we did not allow for phasing of the kind I have mentioned.
  I hope that the hon. Gentleman will not press the Amendment, because it shows a complete disregard for the considerable hardship that many tenants would face if the whole increase were imposed in one go. If a small or relatively small increase is agreed, then, of course, the landlord will be able to have it in one year, but if it is a steep increase, it is clear that we should give the tenant some protection. Not to do so would be to create considerable difficulties in many cases and would also affect the prices and incomes policy and the policy towards rents and so on which we judge to be necessary. If phasing is right at the moment, I cannot believe that it can be wrong in 1971. If it is right in 1969 and 1970, it must also be right in 1971 and therefore I cannot accept the Amendment.
  Question put, That the Amendment be made: —
  The Committee divided: Ayes 124, Noes 189.

  Division No. 17.]

  AYES

  [10.19 p.m.

  Ailason, James (Hemel Hempstead)

  Dodds-Parker, Douglas

  Jenkin, Patrick (Woodford)

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

  Eden, Sir John

  Kershaw, Anthony

  Baker, W. H. K. (Banff)

  Elliot, Capt. Walter (Carshalton)

  King, Evelyn (Dorset, S.)

  Bainiel, Lord

  Eyre, Reginald

  Kitson, Timothy

  Bennett, Dr. Reginald (Cos. & Fhm)

  Farr, John

  Lancaster, Col. C. G.

  Biffen, John

  Fortescue, Tim

  Lane, David

  Boardman, Tom (Leicester, S.W.)

  Foster, Sir John

  Legge-Bourke, Sir Harry

  Body, Richard

  Glover, Sir Douglas

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

  Boyd Carpenter, Rt. Hn. John

  Cower, Raymond

  MacArthur, Ian

  Boyle, Rt. Hn. Sir Edward

  Grant, Anthony

  Maclean, Sir Fitzroy

  Brewis, John

  Grant-Ferris, Sir Robert

  McMaster, Stanley

  Brown, Sir Edward (Bath)

  Griffiths, Eldon (Bury St. Edmunds)

  McNair-Wilson, Michael

  Bruce-Gardyne, J.

  Griffiths Eldon, St. Edmunds)

  Maddan, Martin

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

  Gurden, Harold

  Maginnis, John E.

  Buck, Antony (Colchester)

  Hal-Davis, A. G. F.

  Mawby, Ray

  Campbell, B. (Oldham, W.)

  Harrison, Brian (Maldon)

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

  Campbell, Gordo I (Moray & Nairn)

  Harrison, Col. Sir Harwood (Eye)

  Mills, Stratton (Belfast, N.)

  Carlisle, Mark

  Hastings, Stephen

  Miscampbell, Norman

  Chataway, Christopher

  Hawkins, Paul

  Monro, Hector

  Cooke, Robert

  Heald, Rt. Hn. Sir Lionel

  Montgomery, Fergus

  Corfield, F. V.

  Heseltine, Michael

  More, Jasper

  Costain, A. P.

  Higgins, Terence L.

  Morgan, Ceraint (Denbigh)

  Crowder, F. P.

  Hill, J. E. B.

  Mott-Radclyffe, Sir Charles

  Currie, C. B. H.

  Hogg, Rt. Hn. Quintin

  Munro-Lucas-Tooth, Sir Hugh

  Dalkeith, Earl of

  Holland, Philip

  Nabarro, Sir Gerald

  Dance, James

  Hornby, Richard

  Neave, Airey

  Dean, Paul

  Hunt, John

  Nicholls, Sir Harmar

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

  Irvine, Bryant Godman (Rye)

  Nott, John

  Page, Graham (Crosby)

  Silvester, Frederick

  Walker-Smith, Rt. Hn. Sir Derek

  Page, John (Harrow, W.)

  Sinclair, Sir George

  Ward, Christopher (Swindon)

  Percival, Ian

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

  Ward, Dame Irene

  Pike, Miss Mervyn

  Smith, John (London & w'minster)

  Wells, John (Maidstone)

  Pink, R. Bonner

  Stainton, Keith

  Whitelaw, Rt. Hn. William

  Pounder, Rafton

  Stoddart-Scott, Col. Sir M.

  Wiggin, A. W.

  Prior, J. M. L.

  Summers, Sir Spencer

  Williams, Donald (Dudley)

  Pym, Francis

  Taylor, Frank (Moss Side)

  Wilson, Geoffrey (Truro)

  Rhys Williams, Sir Brandon

  Temple, John M.

  Wolrige-Gordon, Patrick

  Rodgers, Sir John (Sevenoaks)

  Thatcher, Mrs. Margaret

  Worsley, Marcus

  Rossi, Hugh (Hornsey)

  Tilney, John

  Wylie, N. R.

  Russell, Sir Ronald

  van Straubenzee, W. R.

  St. John-Stevas, Norman

  Vaughan-Morgan, Rt. Hn. Sir John

  TELLERS FOR THE AVES:

  Scott-Hopkins, James

  Waddington, David

  Mr. Bernard Weatherill and

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

  Walker, Peter (Worcester)

  Mr. Walter Clegg.

  NOES

  Allaun, Frank (Salford, E.)

  Golding, John

  Mason, Rt. Hn. Roy

  Alldritt, Walter

  Gregory, Arnold

  Mellish, Rt. Hn. Robert

  Anderson, Donald

  Grey, Charles (Durham)

  Millan, Bruce

  Atkins, Ronald (Preston, N.)

  Griffiths, Eddie (Brightside)

  Miller, Dr. M. S.

  Atkinson, Norman (Tottenham)

  Hamilton, James (Bothwell)

  Milne, Edward (Blyth)

  Bacon, Rt. Hn. Alice

  Hamilton, William (Fife, W.)

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

  Baxter, William

  Hamling, William

  Molloy, William

  Beaney, Alan

  Hannan, William

  Morris, Alfred (Wythenshawe)

  Morris, Charles R. (Openshaw)

  Bence, Cyril

  Harper, Joseph

  Morris, John (Aberavon)

  Bennett, James (G'gow, Bridgeton)

  Harrison, Walter (Wakefield)

  Moyle, Roland

  Binns, John

  Haseldine, Norman

  Neal, Harold

  Blackburn, F.

  Hazell, Bert

  Newens, Stan

  Blenkinsop, Arthur

  Henig, Stanley

  Norwood, Christopher

  Boardman, H. (Leigh)

  Herbison, Rt. Hn. Margaret

  Oakes, Gordon

  Booth, Albert

  Hilton, W. S.

  O'Halloran, Michael

  Boston, Terence

  Horner, John

  Orbach, Maurice

  Bottomley, Rt. Hn. Arthur

  Howeil, Denis (Small Heath)

  Oswald, Thomas

  Hoyden, James

  Howie, W.

  Owen, Will (Morpeth)

  Broughton, Sir Alfred

  Hoy, Rt. Hn. James

  Page, Derek (King's Lynn)

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

  Huckfield, Leslie

  Pannell, Rt. Hn. Charles

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

  Hughes, Roy (Newport)

  Park, Trevor

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

  Hunter, Adam

  Pavitt, Laurence

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

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

  Pearson, Arthur (Pontypridd)

  Cant, R. B.

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

  Perry, Ernest G. (Battersea, S.)

  Carmichael. Neil

  Johnston, Russell (Inverness)

  Perry, George H. (Nottingham, S.)

  Carter-Jones, Lewis

  Jones, Dan (Burnley)

  Prentice, Rt. Hn. Reg.

  Chapman, Donald

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

  Price, Thomas (Westhoughton)

  Coleman, Donald

  Jones, J. Idwal (Wrexham)

  Probert, Arthur

  Concannon, J. D.

  Jones, T. Alec (Rhondda, West)

  Richard, Ivor

  Conlan, Bernard

  Judd, Frank

  Roberts, Albert (Normanton)

  Crawshaw, Richard

  Keoley, Richard

  Roberts, Rt. Hn. Goronwy

  Dalyell, Tam

  Kerr, Russell (Feltham)

  Roberts, Gwilym (Bedfordshire, S.)

  Darling, Rt. Hn. George

  Lawler, Wallace

  Robertson, John (Paisley)

  Davidson, Arthur (Accrington)

  Lawson, George

  Ross, Rt. Hn. William

  Davies, Ednyfed Hudson (Conway)

  Leadbitter, Ted

  Ryan, John

  Davies, G. Elfed (Rhondda, E.)

  Lee, Rt. Hn. Jennie (Cannock)

  Shaw, Arnold (llford, S.)

  Davies, Rt. Hn. Harold (Leek)

  Lee, John (Reading)

  Silverman, Julius

  Davies, S. O. (Merthyr)

  Lestor, Miss Joan

  Small, William

  Dempsey, James

  Lewis, Arthur (W. Ham, N.)

  Spriggs, Leslie

  Dewar, Donald

  Lewis, Ron (Carlisle)

  Swain, Thomas

  Dickens, James

  Loughin, Charles

  Taverne, Dick

  Doig, Peter

  Lubbock, Eric

  Thomas, Rt. Hn. George

  Dunnett, Jack

  Lyon, Alexander W. (York)

  Tinn, James

  Dunwoody, Mrs. Gwyneth (Exeter)

  Lyons, Edward (Bradford, E.)

  Urwin, T. W.

  Eadie, Alex

  Mabon, Dr. J. Dickson

  Varley, Eric G.

  Edwards, Robert (Bilston)

  McBride, Neil

  Wainwright, Edwin (Dearne Valley)

  Edwards, William (Merioneth)

  McCann, John

  Wainwright, Richard (Colne Valley)

  English, Michael

  MacColl, James

  Walker, Harold (Doncaster)

  Ensor, David

  MacDermot, Niall

  Watkins, David (Consett)

  Evans, Fred (Caerphilly)

  McElhone, Frank

  Watkins, Tudor (Brecon & Radnor)

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

  McGuire, Michael

  Weitzman, David

  Faulds, Andrew

  Mackenzie, Alasdair(Ross&Crom'ty)

  Wellbeloved, James

  Fernybough, E.

  Mackenzie, Gregor (Rutherglen)

  Wells, William (Walsall, N.)

  Finch, Harold

  Mackie, John

  Wilkins, W. A.

  Fitch, Alan (Wigan)

  Maclennan, Robert

  Willey, Rt. Hn. Frederick

  Fletcher, Rt.Hn.SirEric(lslington,E.)

  McMillan, Tom (Glasgow, C.)

  Williams, Clifford (Abertillery)

  Fletcher, Ted (Darlington)

  McNamara, J. Kevin

  Willis, Rt. Hn. George

  Foot, Michael (Ebbw Vale)

  MacPhersnn, Malcolm

  Winnick, David

  Ford, Ben

  Mahon, Simon (Bootle)

  Woodburn, Rt. Hn. A.

  Forrester, John

  Mallalieu, E. L. (Brigg)

  Woof, Robert

  Fowler, Gerry

  Mallalieu,J.P.W.(Huddersfie!d,E.)

  Freeson, Reginald

  Manuel, Archie

  TELLERS FOR THE NOES:

  Calpern, Sir Myer

  Mapp, Charles

  Mr. Ernest Armstrong and

  Gardner, Tony

  Marks, Kenneth

  Mr. R. F. H. Dobson.

  Mr. Denis Howell: I beg to move Amendment No. 6, in page 5, leave out lines 1 to 4 and insert:
  'Where a tenant under a regulated tenancy of a dwelling, or a person who might succeed him as a statutory tenant, becomes the tenant under a new regulated tenancy of the dwelling and, whether before or after he becomes the tenant under the new regulated tenancy, a rent for the dwelling is registered, then, if the provisions of subsection (1) of this section apply—'.
  This is a technical Amendment, dealing with a very involved situation. [Laughter.] I am glad that I carry hon. Gentlemen with me on that at this late hour. It deals with dwellings that were subject to contractual arrangements then become statutory and then go back to contractual. There is a possibility of a loophole which I am sure we would all like to plug.
  Mr. Graham Page: Having referred to our Amendments as "vague" on one occasion and "imprecise" on another, is the Minister of State not a little bit embarrassed to have to come forward with this Amendment, to stop up a loophole?
  Amendment agreed to.
  10.30 p.m.
  Mr. Denis Howell: I beg to move Amendment No. 7, in page 5, line 23, leave out 'or paragraph 6' and insert '6 or 8'.
  Nothing that I say is vague or imprecise.Amendments Nos.7 and 8 deal
  with very technical matters and are put down to stop overlapping.
  Amendment agreed to.
  Further Amendment made: No. 8, in page 5, line 24, leave out 'or paragraph 6' and insert '6 or 8'.—[Mr. Denis Howell.]
  Clause 5, as amended, ordered to stand part of the Bill.
  Clauses 6 and 7 ordered to stand part of the Bill.

Schedule

  PHASING OF RENT INCREASES
  Mr. Denis Howell: I beg to move Amendment No. 11, in page 7, line 30, after 'sixpence', insert 'a week'.
  This Amendment rectifies an error on our part, for which I apologise. Without it, the 7s. 6d. could be a month or a year—and, in fact, it is to be a week.
  Amendment agreed to.
  Schedule, as amended, agreed to.
  Bill reported, with Amendments; as amended, considered.
  Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 55 (Third Reading)—
  The House divided: Ayes 183, Noes 124.

  Division No. 18.]

  AYES

  (10.32 p.m.

  Allaun, Frank (Salford, E.)

  Concannon, J. D.

  Freeson, Reginald

  Alldritt, Walter

  Conlan, Bernard

  Galpern, Sir Myer

  Anderson, Donald

  Crawshaw, Richard

  Gardner, Tony

  Armstrong, Ernest

  Dalyell, Tam

  Golding, John

  Atkins, Ronald (Preston, N.)

  Davidson, Arthur (Accrington)

  Gregory, Arnold

  Atkinson, Norman (Tottenham)

  Davies, Ednyfed Hudson (Conway)

  Grey, Charles (Durham)

  Bacon, Rt. Hn. Alice

  Davies, G. Elfed (Rhondda, E.)

  Griffiths, Eddie (Brightside)

  Baxter, William

  Davies, Rt. Hn. Harold (Leek)

  Hamilton, William (Fife, W.)

  Beaney, Alan

  Davies, S. O. (Merthyr)

  Hamling, William

  Bence, Cyril

  Dempsey, James

  Hannan, William

  Bennett, James (G'gow, Bridgeton)

  Dewar, Donald

  Harper, Joseph

  Binns, John

  Dickens, James

  Harrison, Walter (Wakefield)

  Blackburn, F.

  Doig, Peter

  Haseldine, Norman

  Blenkinsop, Arthur

  Dunnett, Jack

  Hazell, Bert

  Boardman, H. (Leigh)

  Dunwoody, Mrs. Gwyneth (Exeter)

  Henig, Stanley

  Booth, Albert

  Eadie, Alex

  Herbison, Rt. Hn. Margaret

  Boston, Terence

  Edwards, William (Merioneth)

  Hilton, W. S.

  Bottomley, Rt. Hn. Arthur

  English, Michael

  Hordern, Peter

  Boyden, James

  Ensor, David

  Howell, Denis (Small Heath)

  Broughton, Sir Alfred

  Evans, Fred (Caerphilly)

  Howie, W.

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

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

  Hoy, Rt. Hn. James

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

  Faulds, Andrew

  Huckfield, Leslie

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

  Fernyhough, E.

  Hughes, Roy (Newport)

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

  Fitch, Alan (Wigan)

  Hunter, Adam

  Cant, R. B.

  Fletcher,Rt.Hn.Sir Eric(lslington,E.)

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

  Carmichael, Neil

  Fletcher, Ted (Darlington)

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

  Carter-Jones Lewis

  Foot, Michael (Ebbw Vale)

  Johnston, Russell (Inverness)

  Chapman, Donald

  Forrester, John

  Jones, Dan (Burnley)

  Coleman, Donald

  Fowler, Gerry

  Jones,Rt.Hn.Sir Elwyn(W.Ham.t.>

  Jones, J. Idwal (Wrexham)

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

  Roberts Rt. Hn. Goronwy

  Jones, T. Alec (Rhondda, West)

  Manuel, Archie

  Roberts Gwilym (Bedfordshire, S.)

  Judd, Frank

  Mapp, Charles

  Robertson John (Paisley)

  Kelley, Richard

  Marks Kenneth

  Ross, Rt. Hn, William

  Kerr, Russell (Feltham)

  Mason Rt. Hn. Roy

  Ryan, John

  Lawler, Wallace

  Mellish Rt. Hn. Robert

  Shaw, Arnold (llford, S.)

  Lawson, George

  Millan, Bruce

  Silverman, Julius

  Leadbitter, Ted

  Miller, Dr. M. S.

  Small William

  Lee, Rt. Hn. Jennie (Cannock)

  Milne, Edward (Blyth)

  Spriggs Leslie

  Lee, John (Reading)

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

  Swain, Thomas

  Lestor, Miss Joan

  Molloy, William

  Taverne Dick

  Lewis, Arthur (W. Ham, N.)

  Morris, Alfred (Wythenshawe)

  Thomas, Rt. Hn. George

  Lewis, Ron (Carlisle)

  Morris, Charles R. (Openshaw)

  Tinn, James

  Loughlin, Charles

  Morris, John (Aberavon)

  Urwin, T. W.

  Lubbock, Eric

  Neal, Harold

  Varley Eric G.

  Lyon, Alexander W. (York)

  Newens, Stan

  Wainwright Edwin (Dearne Valley)

  Norwood, Christopher

  Lyons, Edward (Bradford, E.)

  Oakes, Gordon

  Wainwright, Richard (Colne Valley)

  Mabon, Dr. J. Dickson

  O'Halloran, Michael

  Walker, Harold (Doncaster)

  McBride, Neil

  Orbach Maurice

  Watkins, David (Consett)

  McCann, John

  Oswald, Thomas

  Watkins, Tudor (Brecon & Radnor)

  MacColl, James

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

  Weitzman, David

  MacDermot, Niall

  Page, Derek (King's Lynn)

  Wellbeloved, James

  McElhone, Frank

  Pannell, Rt. Hn. Charles

  Wells William (Walsall N.)

  McGuire, Michael

  Park, Trevor

  White, Mrs. Eirene

  Mackenzie, Alasdair(Ross&Crom'ty)

  Pavitt, Laurence

  Williams, Clifford (Abertillery)

  Mackenzie, Gregor (Rutherglen)

  Pearson, Arthur (Pontypridd)

  Wills, Rt. Hn. Ceorge

  Mackie, John

  Perry Ernest G. (Battersea, S.)

  Winnick, David

  Maclennan, Robert

  Perry, George H. (Nottingham, S.)

  Woodburn, Rt. Hn. A.

  McMillan, Tom (Glasgow, C.)

  Prentice, Rt. Hn. Reg.

  Woof, Robert

  McNamara, J. Kevin

  Price, Thomas (Westhoughton)

  MacPherson, Malcolm

  Probert, Arthur

  TELLERS FOR THE AYES:

  Mahon, Simon (Bootle)

  Richard Ivor

  Mr. James Hamilton and

  Mallalieu, E. L. (Brigg)

  Roberts Albert (Normanton)

  Mr R. P. H. Dobson.

  NOES

  Allason, James (Hemel Hempstead)

  Hastings, Stephen

  Pike, Miss Mervyn

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

  Hawkins, Paul

  Pink, R. Bonner

  Baker, W. H. K. (Banff)

  Heald, Rt. Hn. Sir Lionel

  Pounder Rafton

  Balniel, Lord

  Heseltine, Michael

  Prior, J. M. L.

  Bennett, Dr. Reginald (Gos. & Fhm)

  Higgins, Terence L.

  Pym Francis

  Biffen, John

  Hill, J. E. B.

  Rhys Williams, Sir Brandon

  Boardman, Tom (Leicester, S.W.)

  Hogg, Rt. Hn. Quintin

  Rodgers, Sir John (Sevenoaks)

  Body, Richard

  Holland, Philip

  Rossi, Hugh (Hornsey)

  Boyd-Carpcnter, Rt. Hn. John

  Hornby, Richard

  Russell, Sir Ronald

  Boyle, Rt. Hn. Sir Edward

  Hunt, John

  St. John-Stevas, Norman

  Brewis, John

  Irvine, Bryant Godman (Rye)

  Scott-Hopkins, James

  Brown, Sir Edward (Bath)

  Jenkin, Patrick (Woodford)

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

  Bruce-Gardyne, J.

  Kershaw, Anthony

  Silvester, Frederick

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

  King, Evelyn (Dorset, S.)

  Sinclair, Sir George

  Buck, Antony (Colchester)

  Kitson, Timothy

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

  Campbell, B. (Oldham, W.)

  Lancaster, Col. C. G.

  Smith, John (London & W'minster)

  Campbell, Gordon (Moray & Nairn)

  Lane, David

  Stainton, Keith

  Carlisle, Mark

  Legge-Bourke, Sir Harry

  Stoddart-Scott, Col. Sir M.

  Chataway, Christopher

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

  Summers, Sir Spencer

  Clegg, Walter

  MacArthur, Ian

  Taylor Frank (Moss Side)

  Cooke, Robert

  Maclean, Sir F, tzroy

  Temple, John M.

  Corfield, F. V.

  McMastcr, Stanley

  Thatcher, Mrs. Margaret

  Costain, A. P.

  McNair-Wilson, Michael

  Tilney, John

  Crowder, F. P.

  Maddan, Martin

  van Straubenzee, W. R.

  Currie, G. B. H.

  Maginnis, John E.

  Vaughan-Morgan, Rt. Hn. Sir John

  Dalkeith, Earl of

  Mawby, Ray

  Waddington, David

  Dance, James

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

  Walker, Peter (Worcester)

  Dean, Paul

  Mills, Stratton (Belfast, N.)

  Walker-Smith, Rt. Hn. Sir Derek

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

  Miscampbell, Norman

  Ward, Christopher (Swindon)

  Dodds-Parker, Douglas

  Monro, Hector

  Ward Dame Irene

  Eden, Sir John

  Montgomery, Fergus

  Wells, John (Maidstone)

  Elliot, Capt. Walter (Carshalton)

  More, Jasper

  Whitelaw, Rt. Hn. William

  Farr, John

  Morgan, Geraint (Denbigh)

  wiggin, A. W.

  Fisher, Nigel

  Mott-Radclyffe, Sir Charles

  Williams, Donald (Dudley)

  Fortescue, Tim

  Munro-Lucas-Tooth, Sir Hugh

  Wilson, Geoffrey (Truro)

  Foster, Sir John

  Nabarro, Sir Gerald

  Wolrige-Gordon, Patrick

  Glover, Sir Douglas

  Neave, Airey

  Worsley, Marcus

  Gower, Raymond

  Nicholls, Sir Harmar

  Wylie, N R.

  Grant, Anthony

  Nott, John

  Grant-Ferris, Sir Robert

  Orr-Ewing Sir Ian

  TELLERS FOR THE NOES:

  Griffiths, Eldon (Bury St. Edmunds)

  Page, Graham (Crosby)

  Mr. Reginald Eyre and

  Gurden, Harold

  Page, John (Harrow W.)

  Mr. Bernard Weatherill.

  Harrison, Col. Sir Harwood (Eye)

  Percival, Ian

  Bill accordingly read the Third time, and passed.

ROADS (SCOTLAND) BILL
Order for Second Reading read.
Bill referred to the Scottish Grand Committee.—[Dr. Dickson Mabon.]

SCOTLAND (SCHOOL BUILDING PROGRAMME)
Motion made, and Question proposed, That this House do now adjourn.— [Mr. Armstrong.]
10.42 p.m.
Mr. W. H. K. Baker: I wish to base my remarks on the Scottish Education Department Circular No. 600 of October, 1965, and to refer specifically to how it is affecting my own constituency of Banffshire. I begin by quoting from paragraph 8 of the circular, which says, inter alia:
"The Secretary of State asks authorities to organise their secondary"—
that is, their secondary school—
"provision on comprehensive lines and to introduce this form of organisation as circumstances permit."
Banffshire Education Committee has faithfully carried out the necessary review of its plans for the reorganisation on comprehensive lines and has thus espoused the comprehensive course, a course which I fully agree with and support the committee in. It did this particularly bearing in mind paragraph 11 of yet another Scottish Education Department Circular, No. 609, of 19th May, 1966, which spoke of a co-ordinated building programme arranged by the Scottish Education Department. That circular was followed by a letter to the County Director of Education from the S.E.D., dated 19th July, 1966, which said, in essence, that the S.E.D. approved of the list of priorities as laid down by the Education Committee at that time.
It was eventually decided that there would be built in the county three large comprehensive schools, one each at Keith, Banff and Buckie, each being fed from a large catchment area around those three main towns. Subsequently, after strong pressure from a joint committee formed on Speyside, Banffshire Education Committee agreed in principle to the establishment of a school on Speyside.At the
574
same time, the Government agreed in principle to the same project after strong representations by myself, and for that the county and myself are very grateful.
The present position is that Keith Grammar School and Banff Academy are fully operative, and it is perfectly true to say that already they are bursting at the seams. Buckie High School is woefully inadequate, and unable to cope with the secondary school pupils from what I have called its catchment area.
Taking the overall position of the county into consideration, Banffshire Education Committee has done its utmost to meet the Government's policy, but it has not been given the tools to finish the job, that is, the necessary finance. At least three newly-built or reconstructed secondary schools have been discarded, and others have been closed, because of the change in the central Government's policy which came about after 1965. Thus, large capital expenditure on secondary has been wasted. That is no fault of the education authority, and it is not use looking back in anger, for that certainly will not build new schools. The county is now being penalised because it has carried out Government policy, and not only is the authority suffering, but the pupils and indeed the parents.
It is essential that equal opportunities —and this is Government policy—should be available for all children throughout the entire country. The reason why only those children who reside in the Banff catchment area are enjoying the benefits while the rest of the children in the county are not, is that there is a shortfall in the capital building allocation by the Government. The county now has four types of secondary school, and only one is fully comprehensive. That in itself is a complete negation of the Government's policy of all-through comprehensive schools.
The Banff Education Committee, at the behest of the Scottish Education Department, has drawn up, in three parts, a list of priorities, as follows. First, Buckie High Schol; to alleviate the present overcrowding—the roll is 728—to take in 203 extra secondary pupils from the Buckie catchment area and to prepare for an approximately 10 per cent. increase in students in 1972 as a result of the raising of the school-leaving age, the allocation

575
required is no less than £650,000. The authority has planned to adapt and enlarge the building which was put up in 1927. We are not asking for an entirely new building to be constructed. The county council realises the necessity for economy and is perfectly willing to adapt where possible.
Second on the list of priorities is the new Speyside school. Again, it is pertinent to quote from S.E.D. Circular 600, paragraph 10:
"[The Secretary of State] appreciates, however, that in some areas geographical factors will make the 'all-through' comprehensive school impracticable, because it would impose on very many of the pupils an intolerable burden of daily travel, or even the need to live away from home."
That is precisely why the education authority has agreed to have a new school at Speyside and have put it high on the list of priorities.
Many secondary school pupils travel more than 50 miles per day to Keith, during many months of the year in darkness, and often in wild weather. They are accommodated at Keith Grammar School, which was never designed for the large numbers which it now has to house. For the new school at Speyside £450,000 is needed. The difficulties in Banffshire are not confined to secondary building alone. The Buckie primary school is packed to capacity and is forced to operate a three-stream system of education which has been harshly criticised by the Scottish Education Department.
I turn to the third on the list of priorities of the education committee, Whitehills primary school. That has been described by H.M. Inspector of Schools as being in the worst condition of any primary school in the north east of Scotland. It is in a deplorable state. The capital required to reconstruct the school is £90,000. Thus the capital required for Buckie High School, the new Speyside school and the reconstruction of Whitehills primary school amounts to £1,190,000.
This figure should be borne in mind when one remembers that in a letter of 22nd August, 1969, to the authority the Scottish Education Department announced a capital allocation for the first half of a two year period to March, 1972, of
576
£100,000.That is a shortfall of nearly £1,100,000 on requirement.
At the meeting on 31st October at St. Andrew's House, to which the Minister referred in his Answer to me last Wednesday, he stated that the allocation for the second half of the period to March 1972 is likely to increase towards the end of the year. I hope that tonight he will be able to give the House some information on this subject.
The delegation from the authority agreed to go back to see how best they could utilise about a twelfth of the sum of £100,000 which they really need. They have decided in principle at least to build a three-storey block at Buckie High School, leaving the ground floor unfinished. All that will achieve is that the rector will be able to bring into his school the remaining secondary pupils in his catchment area. There will be no technical provision, no physical education provision, nothing for school means, and no refurbishing of the 1927 building.
At best, this can be described as a makeshift arrangement and it still depends on the fulfilment of a further £150,000 being allocated before March, 1972. So far, we have no promise of that. This is not good enough. As one county official said to me only yesterday, "How can we plan anything if we do not know sufficiently far ahead what we will have to spend?"
A headline in yesterday's Banffshire Journal speaks for itself:
"Parents will be told Government are to blame for lack of progress in school building."
I think that that is fair comment.
I conclude by impressing on the Under-Secretary of State, with all the power at my command, the urgency of the situation. Without a substantial part of the required allocation being made available quickly, the proposal to raise the school-leaving age in Banffshire in 1972 is total nonsense. I know that I have the support of the entire country behind me in my plea tonight. Let the Government meet their responsibilties in an equitable and just manner.
10.55 p.m.
The Joint Under-Secretary of State for Scotland (Mr. Bruce Millan): The hon. Member for Banff (Mr. W. H. K. Baker) has dealt almost exclusively with the Banffshire situation.But I am sure he

577
will understand if, first, I say something about the general background, especially as the title of his Adjournment debate slightly misled me, though I know that he was in no way responsible. I thought that he had intended to say a number of things about the Scottish programme as a whole. In any case, I would have preferred to deal with what he has said by dealing first with Scotland and then with the particular points about Banffshire. I hope that in the time available to me I can take up all or most of the points made by the hon. Gentleman about his own education authority.
It is useful to remind hon. Members of the present scale of the school building programme. In 1965 and 1966 the average annual value of school building projects in Scotland as a whole was about £17 million. With the raising of the school-leaving age then projected originally for 1970–71, the level of starts was raised to £26 million a year for the three-year period from 1967–68 to 1969–70, giving a total programme of £78 million.
When the raising of the school-leaving age was deferred to 1972–73, the programme was reduced to £73 million and, as I announced in some detail during the debate on the Education Estimates on 3rd July last, the three-year programme of £73 million was extended to make a five-year programme for the period 1967–68 to 1971–72, aimed at starting school building to the value of about £125 million, or £25 million a year on average.
That is the programme for the full period, and the authorities have made an extremely good start with it In fact, the progress has been so rapid in the years 1967–68 and 1968–69 that, assuming similar progress is maintained in the present year—and there is every indication that it will—we estimate that the authorities will have started about £89 million worth of building by March, 1970.
This means, as I explained in the debate I have mentioned and as was explained in a circular subsequently sent to local authorities, that the starts in the remaining two years of the programme, 1970–72, will be at a lower level than the starts for the three years to 1970. Authorities have had the advantage of being able to start the projects which are necessary for the raising of the age
578
in most cases in very good time indeed—
Mr. Ian MacArthur: While We can understand that with the postponement of the raising of the school-leaving age for two years a slight decline in the number of starts was to be expected, can the hon. Gentleman explain how it is that the number of approvals given for new school building in Scotland has fallen in the first nine months of the year by well over 15 per cent.?
Mr. Millan: With respect, if I am to answer the points raised by the hon. Member for Banff it is not possible for me to take up the point just mentioned by the hon. Member for Perth and East Perthshire (Mr. MacArthur), but I should be glad to discuss it on another occasion. I will be referring to starts figures for this year, which are the important thing. Approvals are not so important. We are talking basically of the starts to meet the 1972 date.
What I have said about the general scale of the programme and the way in which it would move over the next two years is simply a repetition of what has been given out in the circular, and of what I said in the Estimates debate earlier this year—
Mr. MacArthur: Will the Minister give way?
Mr. Millan: No. There may be time at the end of my remarks, but if I give way now I shall not be able to deal with the schools in Banffshire, which will not, I am sure, please the hon. Member's hon. Friend.
The total value of school building started rose from £16·7 million in 1966 to £25·4 million in 1967 and £35·5 million in 1968, and the 1969 figures are also very good. A high proportion of starts is now for secondary accommodation and we ought to have a substantial number of projects completed in very good time for the raising of the school-leaving age in 1972–73. In the immediate period beyond 1970, the overriding requirement will be to continue to provide accommodation for the additional number of pupils resulting from the natural growth in the school population, the movement of the existing school population, for example, to new towns and other new

579
housing areas and, of course, the raising of the school-leaving age. This does not mean, however, that other aspects of the programme are being neglected. For example, there is scope for replacing and improving old schools.
Inevitably, the demand for roofs-overheads will mean that authorities will not be in a position to make as much progress as they would perhaps like. I explained to Banff education authority that I had to consider not only its programme, but all the other programmes which authorities have sent in for the period 1970 to 1972. For the first part of that period the £17 million is only part of the allocations to be made available for the two-year period. As the hon. Member said, we hoped by the end of this year to give specific allocations for the rest of the two-year period and also the allocations for 1972–73. It is likely to be a little later than I expected— some time early in the New Year—when I shall be able to give the allocations. That is for the reason that I am considering the representations made by Banffshire education authority and other representations by other authorities about the allocations they have received already for the first part of the two-year period.
I want to take all this into account before putting out the allocations for the next part of the two-year period. Once we have done that, the scope for adjustment by listening to representations by authorities, and so on, is likely to be very limited, but we must try as far as possible to get this absolutely right when we put out the new figures early in the New Year.
The hon. Member particularly raised the question of building to facilitate the reorganisation of secondary education on comprehensive lines and he quoted from Circular 600. If he looks at it again he will see that it has never been our intention to provide investment for school building on a scale which would enable all the necessary new building to be completed and adaptations to be done to existing buildings in a short time. We explained that it would not be realistic for authorities to plan on the basis that their individual programmes would be increased solely to take account of the
580
need to adapt or remodel existing buildings on a scale which would not have been necessary but for reorganisation. The expectation was that the large volume of secondary school building which would have to be undertaken to meet other specific needs would provide opportunities to expedite reorganisation on comprehensive lines and this has proved to be the case.
This is basically what is happening in Scotland as a whole as there is need for providing additional secondary school accommodation for the raising of the school-leaving age and demands of population, and so on, at the same time as the move to comprehensive reorganisation is going ahead. In the circular, announcing the programmes for the first three years of the current five-year programme period, it was made clear that the available investment for secondary purposes over the authority's area as a whole would determine the pace at which reorganisation could be fully and adequately implemented, and we accept that this is not peculiar to Banffshire. Some continuance of existing arrangements or only interim changes in these arrangements would be inevitable in many areas.
I accept that in this interim situation there are bound to be difficulties. I also agree that it is difficult to persuade parents and others interested that equality of opportunity is being given in a situation where there is more than one system of secondary education operating simultaneously within a fairly restricted area between one authority and another.
We have reached a stage in Banffshire with the opening of phase 1 of the new Banff Academy where full secondary education is being given to pupils from one particular part of the county, but we have yet to move towards that particularly in the Buckie area and in the area of Speyside. The hon. Gentleman said that the scheme that the authority put to us for Buckie would have cost £650,000. He also said that this is not wholly required to meet the demands of roofs-over-heads and, in particular, the demands of the raising of the school-leaving age. There are substantial elements here of secondary reorganisation involved.
In view of the other demands on the school building programme in other areas,

581
it is impossible for me to say that Banffshire can start a scheme of this sort, costing this amount of money, in the period 1970–72, even if there were not other projects, which the hon. Gentleman mentioned and which I know that the education authority is anxious to see started.
At the meeting which I had with the authority on 31st October, and at which the hon. Gentleman was present, I asked the authority if it would look at this project and see if it could be broken down into phases. The authority was of the view at the meeting that that would be difficult. We have since heard nothing officially from the authority, but the hon. Gentleman has given me some indication tonight of how the authority's mind is working, because he has said that it is now thinking of a scheme which, as I understood him, would cost about £¼ million and which would do what the authority considers to be absolutely essential in the interim period and omit some of the other matters which, although essential in the longer term, are not absolutely necessary for 1972.
Mr. W. H. K. Baker: It does not take account of the raising of the school-leaving age, as I understand it.
Mr. Millan: In any case, the hon. Gentleman will appreciate that, as I have not seen details of the scheme, it is not possible for me or my Department to judge it. We will examine the new scheme very carefully, because it was the understanding from our meeting that this is what the authority would do. If it has done that, we shall certainly look very carefully at what it proposes.
As to Speyside, I do not think that there is any prospect—I made this clear to the authority—of doing anything in this area in the way of starting a major project in the period up to 1972. I understand the particular difficulties in Speyside. As the hon. Gentleman knows full well, we had a long correspondence about this over a considerable period. I understand the feelings of parents and others in this area. The Speyside project is, in terms of building, strictly a replacement project. It is not strictly to provide basic accommodation for the raising of the leaving age or for any other factor.It is basically a reorganisa-
582
tion proposal. Because of the difficulties I have in meeting the demands on the building programme as a whole, I can see no prospect of dealing with that in the period to 1972.
The hon. Gentleman did not mention the question of an extension which will probably be necessary at Keith Grammar School, which was to cost about £80,000; but, as I think he knows, that is another scheme which we have to take into consideration in considering the priorities for the authority in the next two years.
There is also the question whether it will be possible in that period to do anything about the replacement of White-hills primary school, a project costing £90,000 which the authority considers to be the most urgent and essential project in the primary education field.
It is not possible for me to make any final pronouncement at the moment, because the allocation for the second part of the two-year period has not yet been decided for the authority, and it is, therefore, not possible to say what we shall be able to fit into the two-year period. But, as the hon. Gentleman will remember from my meeting with the education authority, in any case the key factor is the Buckie situation and what is likely to happen over the secondary school accommodation there. Only when we can see that clearly, when we can see what is possible in the way of breaking down into phases the extension which is required at Buckie High School and how much is involved, can we see the demands in the county for school building as a whole—not just in the two years up to 1972 but looking forward into the 1972–73 period. Our circular, which will be coming out at the beginning of the year, will give an indication of what might be available then. Therefore, I am not able at the moment to say much more than I said to the authority at our meeting on 31st October.
I should, however, like to make this point. There was some feeling at the meeting that I had with the authority that Banffshire had been badly dealt with compared with other areas of the country in regard to school building. That is not really so. One cannot make these comparisons simply in terms of population, but in the three-year period from

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1967–70 Banffshire had a fair share on a pupil/population basis. It had over £900,000 in terms of starts including the first phase of the new Banffshire Academy, which was an expensive project, as well as the replacement of two primary schools at Cullen and Keith.
Therefore, the situation—
The Question having been proposed after Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at twelve minutes past Eleven o'clock.

BOARD OF TRADE
  Trawler Support Ship "Orsino"
  Trawler Support Ship "Orsino"
  Airport Consultative Committee Chairmen (Conference)
  Airport Consultative Committee Chairmen (Conference)
  South African Tinned Pineapple
  South African Tinned Pineapple
  Luton Airport (Night Flights)
  Luton Airport (Night Flights)
  Turnhouse Airport
  Turnhouse Airport
  Bankruptcies
  Bankruptcies
  Export Credits
  Export Credits
  Inertia Selling
  Inertia Selling
  Mid-Air Collisions
  Mid-Air Collisions
  African Countries (Trade and Investment)
  African Countries (Trade and Investment)
  O.E.C.D. (Non-reciprocal Preferences Scheme)
  O.E.C.D. (Non-reciprocal Preferences Scheme)
  Motor Vehicles (Hire Purchase)
  Motor Vehicles (Hire Purchase)
  Telephone Tapping Devices
  Telephone Tapping Devices
  Singapore
  Singapore
  Voluntary Liquidations
  Voluntary Liquidations
  Estate Agents (Registration Council)
  Estate Agents (Registration Council)
  Inverness Airport
  Inverness Airport
  Air Safety
  Air Safety
  Public Companies (Disclosure)
  Public Companies (Disclosure)
  Servicemen (Hospitality Expenses)
  Servicemen (Hospitality Expenses)
  Heathrow, London Airport (Night Flights)
  Heathrow, London Airport (Night Flights)
  Liverpool Airport
  Liverpool Airport
  Aircraft Minimum Flying Heights (London)
  Aircraft Minimum Flying Heights (London)
  Northern Regional Controller (Functions)
  Northern Regional Controller (Functions)
  Census of Production
  Census of Production
  Blackrock Coastline Navigation (Safety)
  Blackrock Coastline Navigation (Safety)
  Shipping (Rochdale Committee Report)
  Shipping (Rochdale Committee Report)
  Bankruptcies
  Bankruptcies
  Export Promotion
  Export Promotion
  Statistical Digest
  Statistical Digest
  Trade Missions
  Trade Missions
  Sonic Boom
  Sonic Boom
  Export Intelligence Service
  Export Intelligence Service
  Invisible Exports
  Invisible Exports
  Aircraft Noise
  Aircraft Noise
  Indonesia (Credits)
  Indonesia (Credits)
  Lloyds Bank
  Lloyds Bank
  British Film Fund
  British Film Fund
DEFENCE
  Incident (Belfast)
  Incident (Belfast)
  Hong Kong
  Hong Kong
  Army Horses (Disposal)
  Army Horses (Disposal)
  Air Conditioning Equipment (Singapore and Malaysia)
  Air Conditioning Equipment (Singapore and Malaysia)
  TAVR Cadres (Training)
  TAVR Cadres (Training)
AGRICULTURE, FISHERIES AND FOOD
  Uruguay (Beef)
  Uruguay (Beef)
  Fish (School Meals)
  Fish (School Meals)
  Pepper
  Pepper
SCOTLAND
  Twin Unit Caravans
  Twin Unit Caravans
  Urban Aid Programme (Lanarkshire)
  Urban Aid Programme (Lanarkshire)
  Part-time Teachers (Glasgow)
  Part-time Teachers (Glasgow)
  Western General Hospital, Edinburgh (Orthopaedic Treatment)
  Western General Hospital, Edinburgh (Orthopaedic Treatment)
  Mentally Handicapped (Occupational Centres)
  Mentally Handicapped (Occupational Centres)
  Houses (Glasgow)
  Houses (Glasgow)
  Small Businesses (Closures)
  Small Businesses (Closures)
  Crimes of Violence
  Crimes of Violence
NATIONAL FINANCE
  Public Corporations and Central Government (Industrial and Commercial Assets)
  Public Corporations and Central Government (Industrial and Commercial Assets)
  Balance of Payments
  Balance of Payments
  Export Promotion (Cheap Credit)
  Export Promotion (Cheap Credit)
  Land Commission (Costs of Works)
  Land Commission (Costs of Works)
TECHNOLOGY
  Advisory Committee on Legal Units of Measurement
  Advisory Committee on Legal Units of Measurement
  Exports (Fuel Industries)
  Exports (Fuel Industries)
  Paper Industry
  Paper Industry
  Nickel
  Nickel
  Northern Region (Contracts)
  Northern Region (Contracts)
  Amphibious Hovercraft
  Amphibious Hovercraft
  Industry and Distribution Trades (Investment)
  Industry and Distribution Trades (Investment)
HOUSE OF COMMONS
  Members (Conditions of Service)
  Members (Conditions of Service)
  Closed Circuit Annunciators
  Closed Circuit Annunciators
  Old Palace Yard (Telephonist)
  Old Palace Yard (Telephonist)
EMPLOYMENT AND PRODUCTIVITY
  Fishing Industry (Industrial Training Board)
  Fishing Industry (Industrial Training Board)
  Price Increases
  Price Increases
  Unemployment
  Unemployment
EDUCATION AND SCIENCE
  Microbiological Research
  Microbiological Research
  Teachers (Salaries)
  Teachers (Salaries)
  Cancer Research
  Cancer Research
  Educational Priority Areas (Lambeth)
  Educational Priority Areas (Lambeth)
  Educational Priority Areas
  Educational Priority Areas
FOREIGN AND COMMONWEALTH AFFAIRS
  Anguilla (Public Safety and Order)
  Anguilla (Public Safety and Order)
HOUSING AND LOCAL GOVERNMENT
  The Grange, Neasden
  The Grange, Neasden
SOCIAL SERVICES
  National Insurance Fund
  National Insurance Fund
TRANSPORT
  M1-A5 Junction (Nuneaton Sign)
  M1-A5 Junction (Nuneaton Sign)
  Ludlow Bypass
  Ludlow Bypass

Preamble
The House met at half past two of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Chester):
The LORD CHANCELLOR on the Woolsack.

THE LORD BISHOP OF ROCHESTER
Richard David, Lord Bishop of Rochester—Was (in the usual manner) introduced.

PROCEDURE ON UNSTARRED QUESTIONS
2.35 p.m.
THE LORD PRIVY SEAL (LORD SHACKLETON): My Lords, with the leave of the House, I should like to make a brief Personal Statement. At the end of yesterday's proceedings I referred to a report from the Procedure Committee about noble Lords speaking after the Minister has replied to an Unstarred Question. I am afraid that I inadvertently misled the House since I am informed that no such Report has been made, although this question has been discussed and is under active consideration at the moment. I am afraid that it was this knowledge which led me into the error of saying that the Committee had, in fact, reported. While adhering to the general principles of what I stated last night, I should like to apologise for an inaccurate statement.

DESTRUCTION OF HEDGEROWS
LORD SORENSEN: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government, in view of the large number of country hedges being destroyed and thus spoiling a countryside amenity, what action is being taken by local authorities covering rural areas to ensure that such destruction shall only
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occur when it is essential; and what investigation has been made to determine on balance to what extent hedgerows are an agricultural advantage or disadvantage.]
THE PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD KENNET): My Lords, planning permission is, under the Town and Country Planning Acts, not required for the removal of hedges. Under the Acts local planning authorities may however make tree preservation orders on hedgerow trees and saplings, and a number of such orders have been made. Grants may be paid under both agriculture and amenity legislation for tree planting. The agricultural advantages and disadvantages of hedgerows are kept under review by the Shelter Research Committee of the Ministry of Agriculture, Fisheries and Food on which university and other research organisations are represented.
LORD SORENSEN: My Lords, while thanking my noble friend for that portion of his reply which I happened to hear, may I ask him whether he would reply a little more clearly to the last part of my Question; that is to say, what investigation has been made to determine the respective advantages and disadvantages from the demolition of hedgerows?
LORD KENNET: My Lords, I apologise for my inaudibility. The matter is being considered by the Shelter Research Committee of the Ministry of Agriculture, Fisheries and Food, and on this Committee are representatives of universities and other relevant research organisations.
LORD SORENSEN: My Lords, is it to be taken that the information is then passed on to the respective and responsible authorities in the rural areas?
LORD KENNET: Yes, my Lords.
LORD OAKSHOTT: My Lords. is there any reason to believe that the principle, well accepted in the past, that hedgerows prevent soil erosion has been abandoned or changed in any way?
LORD KENNET: My Lords, I understand from such evidence as is available so far that hedgerows prevent soil erosion only for rather a short distance into the field, and that the present best

1251
opinion is that in arable farming it is a better bet to have large windbreaks.
LORD ALLERTON: My Lords, may I ask the noble Lord whether he is aware that large fields have considerable agricultural advantages, and that tractor time spent turning round is tractor time wasted? Also, is he aware that the present cost of cutting and laying hedges is in the neighbourhood of some £4 a chain?
LORD KENNET: Yes, my Lords; and this is of course the reason why farmers like to uproot hedgerows. Nevertheless, there is an amenity consideration which has to be balanced against the farming consideration.
THE EARL OF MANSFIELD: My Lords, arising out of the original reply, may I ask whether Her Majesty's Government realise that this wholesale destruction of hedges means also the wholesale destruction of nesting places of insectivorous birds which do so much to reduce agricultural pests?
LORD KENNET: Yes, my Lords; this factor also is taken into account.
EARL FERRERS: My Lords, would the noble Lord agree that it is only a relatively recent innovation to have hedges, and that before the Inclosure Acts hedges were far less common than they are at present and the soil did not then become eroded?
LORD KENNET: Yes, my Lords. Hedges are mainly of 18th and early 19th century origin; that is quite correct.

AGENCY CHARGES ON SMALL BUSINESS TRANSFERS
2.39 p.m.
LORD SORENSEN: My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what consideration has been given to the allegation that certain business agencies have been making excessive charges for the transfer of small businesses whether engaged on production or distribution.]
THE MINISTER OF STATE, BOARD OF TRADE (LORD BROWN): My Lords,
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we have seen a few reports alleging excessive charges by agents for the transfer of small businesses. The most recent was about six months ago. If my noble friend has evidence that this practice is widespread he may like to send it to me, but I should explain that we have no powers at present to take any action.
LORD SORENSEN: My Lords, am I to understand from my noble friend that it is recognised that there are excessive charges in certain cases? If that is so, would it not be wise and appropriate for the Government at least to investigate the matter to see what action can be taken?
LORD BROWN: My Lords, no. We do not recognise that there are excessive charges. There may be, but the recognition of excess implies the ability to lay down a standard, and in a matter as complex as assisting in the sale of a business, with all the necessary calculations as to future profitability and so on, the laying down of a standard is a very difficult matter indeed. If my noble friend has examples we should be interested to hear of them because this would give us data on which we could consider the future of the matter. But we do not believe that this is a widespread evil at the moment, and if such an evil did in fact exist we have no powers at the moment to deal with it.

SCOTTISH FORESTRY EDUCATION CENTRE
THE EARL OF LAUDERDALE: 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 action has been taken to implement the recommendations of the Scottish Technical Education Consultative Council that a Forestry Education Centre be established in Scotland for craft level and supervisory courses.]
THE MINISTER OF STATE, SCOTTISH OFFICE (LORD HUGHES): My Lords, it is expected that only one forestry education centre will be required in Great Britain for supervisory courses. Claims from education authorities in Scotland, England and Wales are being

1253
considered, as well as the views of many other interested bodies, and it is hoped to make an announcement soon. Craft level courses will in any event be provided at a centre in Scotland, but their location must await a decision on the Great Britain centre for supervisory courses.
THE EARL OF LAUDERDALE: My Lords, in thanking the noble Lord for that helpful reply, may I ask him whether he is aware that the proposal for craft courses was made three years ago and for supervisory courses 18 months ago; and as the site in Banff was proposed and nothing seems to have happened, will he hasten a satisfactory conclusion to this matter and in particular of the siting of at any rate the craft level course centre in Scotland?
LORD HUGHES: My Lords, a full course of consultations has been necessary, not only with education authorities but also with many bodies having an interest in training and education for the forestry industry. I do not think that a decision will now be long delayed.
THE EARL OF DUNDEE: My Lords, will the Government bear in mind that about 75 per cent. of the afforestation in Great Britain is now being done in Scotland?
LORD HUGHES: My Lords, while not necessarily committing myself to the percentage quoted by the noble Earl, I can assure him that the Scottish Office is well aware of the preponderant position of Scotland.
LORD INGLEWOOD: My Lords, while not necessarily asking the noble Lord to commit himself further, may I ask him whether he will hear in mind that there is great anxiety in parts of Wales and in the South of England that this one supervisory centre intended to serve the whole of Great Britain should be established either in Banff or in Inverness, which virtually means being out of reach of the larger part of Great Britain?
LORD HUGHES: My Lords, I should find it difficult to agree with that point of view.
THE EARL OF LAUDERDALE: My Lords, in thanking the noble Lord again, may I ask him to give us an assurance that
1254
unworthy competitive regional points will not delay this matter any longer? Does not the noble Lord agree that this centre should go to the country where it belongs?

ANGLO-FRENCH ARMY HELICOPTERS
2.44 p.m.
THE EARL OF KINNOULL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what is the anticipated cancellation cost incurred by the French Government following their cancellation of 150 WG 13 Army helicopters ordered; and what effect this will have on the cost of the British military order.]
THE MINISTER OF STATE, MINISTRY OF TECHNOLOGY (LORD DELACOURT-SMITH): My Lords, I must apologise for the length of the Answer to the noble Earl's Question. The WG 13 is still in the development stage. No production orders can yet be placed by either Government. Cancellation costs do not therefore occur. The decision to discontinue the Attaque variant was taken by France solely for budgetary reasons. As the noble Earl may have seen in the Press this morning, it does not affect their continued participation in the basic development of the aircraft nor their requirement for the Naval variant. At a meeting of the Anglo-French Defence Projects Board in Paris last Monday our two countries committed themselves to the remainder of the development programme up to the launching of the production of the Naval variant in 1972. We had no requirement ourselves for the Attaque variant and its removal from the programme results in some saving in development costs. Moreover, as almost all the work on this variant was to have been done in France, the effect on the United Kingdom industry will be marginal.
I would also draw your Lordships' attention to the position we have now reached on the SA 330 and SA 341 helicopters. On Monday we agreed with the French to start production of the SA 341. We are satisfied that technical

1255
problems on this aircraft have been overcome and that it will fully meet United Kingdom Service requirements. Its export prospects are also good. The greater part of the production will be carried out in the United Kingdom. Work on the SA 330 is also going well. The first jointly produced aircraft have been delivered to the French Army and R.A.F. deliveries start next year. Export orders for 35 aircraft have already been gained.
Both we and the French are convinced that our package agreement offers the best means of meeting our future helicopter requirements. We are also, through the strong links which have been forged between United Kingdom and French firms, steadily increasing our industrial capability in this field.
THE EARL OF KINNOULL: My Lords, while thanking the noble Lord for that almost record detailed statement in reply, may I ask him what the latest estimates are for the research and development costs of the WG 13 helicopter, and whether he can advise us when it is expected that this helicopter will come into service?
LORD DELACOURT-SMITH: My Lords, I am afraid that I am not in a position to give the detailed development costs, nor, at this stage, a precise estimate of when the aircraft may come into service.
EARL JELLICOE: My Lords, can the noble Lord inform us how many production orders are anticipated for the Naval variant of the WG 13 by this country and France?
LORD DELACOURT-SMITH: My Lords, in our own case we are expecting at this stage between 80 and 100 orders, and we expect a somewhat similar number in the case of the French Government.

NEW FOREST BILL [H.L.]
THE EARL OF MALMESBURY: My Lords, I beg leave to introduce a Bill to make a further provision for the New Forest. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read la —(The Earl of Malmesbury.)
On Question, Bill read 1a, and to be Printed.

CONSUMER PROBLEMS
2.49 p.m.
BARONESS BURTON OF COVENTRYrose to call attention to future administrative developments on consumer problems; and to move for Papers. The noble Baroness said: My Lords, in rising to move the Motion which stands in my name on the Order Paper, perhaps I could start with the legal problem of small claims. I hope to cover four main sections in my remarks to-day, namely, the legal problem of small claims; consumer inquiries or complaints; how the Trade Descriptions Act is working; questions being asked in the consumer world.
In our debate on June 23, 1966, I drew attention to the problems and cost of bringing these cases to court, and a year later, on November 14, 1967, I stated what we all realised to be an obvious fact: that we are all too unaware of our legal rights, but, in addition to that, the difficulty, the cost and the uncertainty of enforcing them by legal action deters us from making the attempt. If an aggrieved customer has been persistent, if he has tried what seem to him to be all possible channels—the retailer, the manufacturer, the Citizens Advice Bureaux, the local Weights and Measures inspector, his Member of Parliament and perhaps the Press—if he has tried all these and has got nowhere, what remains? The right to take the case to court. Two years ago I believed that court procedure had not been able to solve the problems of the length and the cost of actions, which are both far too great to deal with the problem of small injustices.
As the House will know, Focus is the magazine published by the Consumer Council and their issue of last July contained an interim report entitled, Is the Legal System any Use to Consumers? It is because of this that I have returned to my theme of three years ago. Do consumers consult solicitors? Do they use the courts? The Consumer Council say that they would be more emphatic and advise people to go to a solicitor

1257
were it not for the fact that their experience suggests that the present legal system is not suitable for pressing consumer claims.
They did a special survey into consumer claims; in other words, claims or counter-claims by ordinary people for misrepresentation or for breach of contract on the grounds that goods or services purchased were not satisfactory. The project covered small claims; that is, claims within the £500 limit of county court jurisdiction. But it was chiefly concerned with claims in the region of £20 to £100 as being the range involving sums regarded as substantial by consumers but as relatively small by the legal system.
The Consumer Council feels that consumer claims form a large enough class of potential legal problems to be considered on their own. Research was carried out into county court records. A survey of solicitors and one of consumers was also made. Obviously court records are regarded as confidential, but permission to examine these was obtained from the Lord Chancellor's office and the registrars concerned, provided that no disclosure was made of parties involved. From this research it appeared doubtful whether county courts were a suitable forum for consumer claims, for two main reasons: first, an individual would find it difficult to conduct a case himself in the county court, while representation at any rate for small claims, is prohibitively expensive; and secondly, the unsuitability and expense of court procedure for technical matters.
Solicitors, asked whether they thought an individual without legal representation could bring an action, felt that few people could handle a complex claim, though many could manage a simple debt claim. Most consumer cases have a technical aspect, and solicitors felt that not only technical questions but complex legal ones were often raised in small claims. Many solicitors were concerned at the prohibitive cost of getting justice over small matters, and this point was made by my noble friend Lord Silkin in the debate on the Address at column 69 on October 29 last.
The Citizens' Advice Bureaux have also been concerned for some years about the relatively minor disputes in which the amount of money at stake is small and
1258
where, because of the fear that the cost of legal proceedings might exceed the amount involved, the matter is now often allowed to go by default. They would therefore welcome the development of informal procedures as alternatives to the courts in such cases and have offered to support and co-operate with the Consumer Council in any further research which may be undertaken. I believe that my noble friend Lord Donaldson may be referring to this matter when he comes to speak. But we should welcome some comment from the noble and learned Lord the Lord Chancellor, and I should like to say to him how much vie all appreciate his intervening today; we know how heavily burdened he is, and we do say "Thank you". We all know his serious concern on matters like these, and I appreciate that a start has been made already in that there is provision in the Administration of Justice Act 1969 by which the financial limit of the cases heard before registrars instead of judges is raised from £30 to £75. This must speed up the procedure. But on the question of expense, would the noble and learned Lord the Lord Chancellor feel able to comment on the small claims courts held in many American towns and cities, as described in the December issue of Focus? Would these be a possibility here?
I come now to consumer inquiries or complaints. As we all know, these are the job of the Citizens' Advice Bureaux and not of the Consumer Council. For some time the Citizens' Advice Bureaux have made a continuous survey of consumer inquiries. To begin with, a pilot scheme was initiated and this was replaced by a system worked out with Board of Trade statisticians. This system was launched in February of this year and was based on a statistically selected sample of about sixty Bureaux distributed all over the country. Those sixty Bureaux were to report on every consumer inquiry. except in the case of Birmingham which was to report on one in ten, in order to lessen the burden of work on the Bureau workers. The forms sent in by the sixty Bureaux to the C.A.B. headquarters are analysed there and weekly reports are sent to the Board of Trade and the Consumer Council, and I myself have a copy. Probably it would help if I stated what the headings are in these weekly reports.

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They are five in number: subject; number of inquiries; date of purchase or contract; approximate cost of article or service; and details.
This has not been the success, or (shall I say?) has not proved its usefulness as much as I anyway had hoped. Why? It is my belief that the original intention was that the Consumer Council should follow through these weekly reports, and this they have not done. Why not? I think the Consumer Council would take the view that insufficient detail has been supplied to them. This is a complicated and involved story which I would prefer to leave for the time being. But perhaps I might digress for a moment and say how I had envisaged this information being used.
I wanted to see the Consumer Council dealing with the national picture, obtaining information from the Citizens' Advice Bureaux on which they could build the the national scene, enabling them to stress where various evils were. For example, suppose returns from the Citizens' Advice Bureaux show many complaints either about particular merchandise, particular methods of selling or advertising merchandise, or too many complaints coming from a particular area and reflecting apparently on traders there, I could see the Consumer Council moving in to call attention to that. I have always believed that the Council had a special function at national overall level and also that they had the means, the machinery and the people to do just that. I have still to be convinced that they should deal with actual complaints or should have regional or local offices; but I do see the development of their excellent broadsheets, pamphlets, booklets, which do so much to help us all and which influence necessary public opinion.
Why has this not worked out? Primarily, if one is honest, it has not worked out because the relationship of the Consumer Council to the Citizens' Advice Bureaux has not been a good one. It is not for me to apportion responsibility for that; nor would it help if I did so. But if this basic fact is not realised it will not be possible to put the matter right, and I believe that if the matter cannot be put right a new system must be found. Really the Citizens' Advice Bureaux and
1260
the Consumer Council never talked the same language, especially over paragraph 858 of the Molony Report, which deals with co-operation between them. There is, of course, the further problem that the Citizens' Advice Bureaux have never found it easy to co-operate with a pressure group, and the Consumer Council see themselves very much in this role. I should like to see the Consumer Council helping the Citizens' Advice Bureaux to do their job more successfully. It would mean that the Council would have to master the principles and techniques upon which the C.A.B. movement is based. Long experience, going back over 30 years, has shown which methods produce the best results in C.A.B. work, and help must be acceptable to them.
I personally think that the onus here is on the Consumer Council. If the Molony recommendations are to be implemented successfully, adequate co-operation and co-ordination are essential. This we have not got. How far have we got to-day with what Molony actually recommended? As the House knows, their priorities are given in paragraph 913 of the Report. In so far as hire-purchase and merchandise marks are concerned the major legislation has been enacted, but the law relating to Sale of Goods has still not been revised. Surely this should now have priority?
As Members know, the Sale of Goods Act 1893 gives the purchaser of goods the right to undisturbed possession and to insist that the goods should match the description under which they are sold and comply with reasonable standards of quality and fitness for their purpose, but it allows the seller to contract out of these conditions. The recent Report of the English and Scottish Law Commissions states that sellers of goods should no longer be allowed to contract out of the statutory duties to provide the buyer with what he expects to get. Many of us have felt strongly on the two questions of contracting out and guarantees, and have expressed these feelings on several occasions.
I realise, of course, that so far as the Law Commission's Report on Exemption Clauses is concerned, this matter would ordinarily be for the Board of Trade; but as we are fortunate enough to have the Lord Chancellor intervening,

1261
we hope perhaps to have his views on this aspect. And on two other points, one general and one specific, I wonder whether he would feel able to comment? On the general point, in the United States President Nixon is proposing to expand jurisdiction of the Federal Trade Commission and to establish a new consumer protection division in the Justice Department. Would it be useful for us to consider that general principle here? And on the specific point, I understand that for some little time our own Government have been examining the legislation in force in New York State under which, if someone receives unsolicited goods, they become his property as an unconditional gift. I was intending to ask whether we could bring in such legislation here, because it would be welcomed by many people. But as the House may know, events have caught up with me and we now have a Bill dealing with unsolicited goods to be introduced by Mr. Davidson in another place. It may be that this fact inhibits comment by the noble and learned Lord on the Woolsack. Reverting to the Molony recommendations, I would point out that if the Sale of Goods Act were dealt with we should then be left with the problem of the control of unregistered seals of approval. I think this afternoon we could ask the Government to give us an indication as to when those two particular items will be dealt with.
I come now to my third section, how the Trade Descriptions Act is working. In the October issue of Which?, the organ of the Consumers' Association, there is a cogent précis of the Act, and I think three points are worth quoting. They are these:
"1. The Act is concerned only with descriptions that are false or misleading to a material degree;
2. The Act is not a general prohibition against shoddy goods—it is concerned with misleading descriptions;
3. The Act lays it down that any of these misleading claims is a criminal offence: a guilty trader may get heavily fined but his victim does not necessarily get any recompense."
That is what the Act does. How is it working? As we all know, local Weights and Measures authorities have been given the duty of enforcement of the Act. I think it should be said straight away that
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because of public misunderstanding about this Act many Weights and Measures authorities have received a number of quite unrelated complaints from shoppers. Recently, the Consumer Council sent out a questionnaire to 242 chief inspectors of Weights and Measures in order to discover how the Act was working. Replies were received from 174, and my following three points are taken from the report in the November issue of Focus. The answers showed, first of all, that during the first six months of the life of the Act at least 17,500 complaints were registered from all sources. Of these, some 11,200 were possible offences reported by the public, some 4,100 were spotted by members of Weights and Measures departments, and 628 were registered by traders or manufacturers, sometimes against each other, sometimes against their own suppliers. If any noble Lord has been adding up those figures he will of course realise that they do not exactly balance. Secondly, labels giving misleading information were the biggest single source of trouble. Thirdly, the three sectors which the Act deals with —goods, prices, services—are not covered equally comprehensively. Enforcement of the Act's provisions in relation to prices is more difficult than it is over descriptions of goods. This has always been obvious.
The House knows what I think of Section 11, and I do not propose to weary your Lordships with tedious repetition. But strong criticism comes from some sections of the grocery trade—not against the Act but against Section 11, which is felt to be virtually unworkable for them. Some groups declare that they are now in the state where the same article might be on sale in their shops at a variety of prices. Are they right? Is their system of management at fault? Or is the Act in need of amendment?
The Chief Inspector of Weights and Measures for a wide area comprising Westminster, Kensington, Chelsea and Hammersmith, is quoted in the Sunday Telegraph of October 12 last as saying:
"The section dealing with prices is particularly open to evasion and the return of the recommended price, legally meaningless, has been widespread. We must assume that the law will, at some future date, be examined and in part re-drawn."
It is not that Section 11 is not enforceable—of course it is enforceable—but it

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is badly drafted, limited and full of loopholes which are widely used.
It would be helpful to know from the Minister what the Government now think of this particular aspect, and of one further point made to me by more than one person. The interpretation of many differences is left to magistrates, and local authorities naturally apply the Act differently. Could the Board of Trade help with some co-ordination and guidance to local inspectors? Presumably their local autonomy is guided by the Board of Trade, and they must work directly in line with their legislation. I think we should bear in mind that they are criminal enforcement officers and their help to consumers is incidental. Some inspectors of Weights and Measures have set up sections to deal with all manner of complaints from local shoppers: the burden has been heavy and additional staff will have to be taken on. But we must look carefully at this and see that there is no wasteful duplication of effort in any area. These, I think, are some of the drawbacks to the success of the Act, but if we exclude Section 11 there is no doubt that the legislation is working well. It has proved a considerable deterrent to that minority in need of such action.
Now I come to the fourth section, questions being asked in the consumer world. In the September issue of the Trade Information Service of the Retail Trading Standards Association, their Director, Mr. Roger Diplock, asked some himself. Several people to whom I have talked said that they could not have thought of better ones. I propose to deal with these for three reasons. The first is that nobody knows more about consumer problems than Mr. Diplock, and the R.T.S.A. has rendered great service to consumers and industry alike. The second is that over a period of almost twenty years never once has the R.T.S.A. given me wrong information. The third is that these are the questions that the consumer world is asking. I informed the noble Lord, Lord Drumalbyn, and the noble Lord, Lord Donaldson of Kingsbridge, that I should be dealing with these.
First of all, I take the Consumer Council. Mr. Diplock asked:
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"Has the Consumer Council, grant aided to the extent of £210,000 annually, made its mark on consumer affairs?"
Yes, my Lords, I think it has; but not enough, and not the right one. I shall return to this matter finally. Next he asked:
"If not, to what extent is this due to the restricted terms of reference which forbid the Council to handle consumer complaints?"
At one time I thought the terms of reference needed looking into, but after the work of these past three months I am not so sure. I do not think the Council should handle consumer complaints. Mr. Diplock further asks:
"Does the Council, indeed, fulfil an essential function which warrants the expenditure of public money?"
My Lords, on the publicity side and on some research I think it does, but the word here is "essential" and I do not believe the Council is fulfilling an essential function, its essential function, and I shall come back to this finally.
On the question of public money, I should like to ask something myself. In the current annual report of the Council the accounts section lists "publicity and research" payments as £64,721 Os. 4d. Could we have this item broken down to tell us how much was spent on the national advertising campaign for TELTAG? How much goes on consumer education, schools, colleges, general publicity. What was the cost of the research projects listed in Appendix D? These are all questions involving the expenditure of public money and are asked for information and not in antagonism. I did, of course, give notice of them to the people concerned.
Now we come to the Citizens' Advice Bureau. Mr. Diplock says:
"There was an intention that the Citizens' Advice Bureaux should widen the scope of their help and advice to local residents in order to embrace shoppers' problems. There are now 500 citizens' advice bureaux throughout the country. Has the intention of the Government in fact been realised?"
The scope has been widened to embrace shoppers' problems, but insufficient money has been available to create adequate development.
Two years ago, in our debate on November 11, at col. 614/15, I stressed that more money was needed for this work, which we must remember was laid on the Bureaux by the Government of

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the day. Indeed, I said I believed that the Council of the Citizens' Advice Bureaux was quite unable, because of the financial problem, to develop as it should and indeed to appoint the actual staff needed then to deal with this burden. I asked the Government (my Government, if the noble Baroness, Lady Phillips, does not mind my saying so) to have a look at this matter, saying that we should at least make sure that the bureaux were equipped financially to staff themselves adequately. I hope the Minister will be able to tell us what has been done about this.
Mr. Diplock further asks,
"… to what extent can these bureaux be manned by experts able to give sound advice to shoppers—or indeed solve the intricacies of their complaints?"
On "complaints", I believe that most lawyers would agree with me that trained voluntary workers in citizens' advice bureaux are as capable of giving sound advice to shoppers as they are of giving sound advice about housing legislation or employment problems, and this has never been in doubt. Concerning "intricacies", I go back seven years ago to our first debate in this House on Molony on November 14, 1962. I stressed then how essential it was that this problem of technical advice was dealt with: that to begin with this should cover four main classes of goods, the four main classes mentioned in the Molony Report as having given rise to most complaints over past years, so that any local citizens' advice bureau which had merchandise brought to it and on which it could not get good technical advice itself, or locally, could refer the matter to the centre. That was in 1962, to a Conservative Government. On March 24, 1965, at col. 637, I tried again, changing my four main classes to five and saying that until this problem of technical advice was dealt with the system would not work, irrespective of who dealt with complaints. That was to a Labour Government, with exactly the same results—nil.
The last question is:
"Can the Bureaux give sound advice to shoppers?"
As recently as last year the Citizens' Advice Bureaux informed me that they could find acceptable solutions to 90 per cent. of the consumer inquiries dealt with, but that the remaining 10 per cent. needed
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to be referred to a specialist service. Most people consulting Citizens' Advice Bureaux about disappointing purchases want redress and are not often concerned to punish offenders. Complaints are more often founded in disputes about facts than in matters of law; but even if the squabble could be resolved by legal action there would almost always be a need for expert opinion as to the performance of the offending article.
The last two groups of questions deal with the Weights and Measures authorities. I have already tried to cover these points, and I think other noble Lords will deal with that area. This brings me to my conclusion and to the very fair question, "What do you suggest should be done?" Administratively the most disappointing outcome of all this has been the failure to recognise the Consumer Council as the co-ordinating machinery. The consumer is not nearly so well served centrally as he is locally. There is not nearly enough co-ordination of effort or, indeed, co-operation between the various bodies supposed to be devoted to consumer interests.
I see three outstanding needs. The first one is co-ordination in a non-pressure atmosphere of the work being done on behalf of consumers; this should lead to greater co-operation. I believe that the Citizens' Advice Bureaux should continue as at present, but only if given adequate finance and independence. This must be forthcoming in the near, the very near, future. If not, then the work will not be successful because of lack of adequate implementation. Responsibility here lies primarily with the National Council of Social Service and with the Government. I hope the Minister will comment for the Government, and I understand that the whole position is now under review between the National Council of Social Service and the National Citizens' Advice Bureaux Council.
The second need I see as informal machinery for the resolution of difficult complaints. This should aim at the facts, leaving it open to the contestants to appeal to the courts on points of law. A number of pilot schemes would have to be tried to determine whether such machinery would work at all, and what form would be most successful. The third need is that it must be decided what central organisation and/or machinery is to do

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the co-ordinating. Should it be the Consumer Council as now? Should it be the Consumer Council with a new constitution? Should it be something else altogether?
My Lords, what type of organisation is necessary to co-ordinate voluntary organisations and trade, local authorities and consumer bodies? What type of body is necessary to follow through the continuous survey done by the Citizens' Advice Bureaux—by refurbished Citizens' Advice Bureaux? What type of body is necessary to satisfy consumers while being fair to retailers?—because we must bear in mind that many consumer complaints are unjustified; that retailers and industry alike deplore the relatively few black sheep who bring discredit upon them but who must be dealt with. That point must be decided: it has been left in abeyance far too long. I see it as a responsibility of Government. I believe that in the past the Government have not looked into this problem sufficiently deeply. I think they should do so now.
I have spent three months preparing for this debate—I hope that it has not seemed even longer to your Lordships. At the beginning I felt that the Consumer Council must have a new constitution or we must have something else altogether. These three months of consultation have brought home to me more than ever before this lack of co-operation and co-ordination that I have been talking about. My Lords, I think this situation could be put right with the existing set-up, so I should like to see one final effort made before we realise we have to embark on a new system. So I return to our old friend Molony and to paragraph 872 of the Report—and I hope the House will bear with me while I quote it:
"We look to the Consumer Council to inspire and co-ordinate the activities of other organisations working for the consumer. We plan to give it the supreme position in consumer affairs. Whether it will seize and retain this position will depend on the quality of its personnel and organisation and its handling of problems. Whether all other consumer bodies will acknowledge its authority remains to be seen. Since they are independently constituted this cannot be assured. But we have little doubt that even if the constitution we recommend for the Consumer Council does not wholly match their views, they will not with-
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hold co-operation. We do not accord it the position of a dictator or claim for it any right to interfere in the organisation or methods of working of any other body. But we would wish to see the paramountcy of the Consumer Council accepted, and its right to act as the overall leader and co-ordinating agency in consumer affairs acknowledged."
My Lords, this result has not been achieved because of lack of confidence. and I should like (and this point is, I think, the only one of which I have not given notice to the noble Baroness) to see the President of the Board of Trade call together six people, with himself in the chair. The six people would comprise the Chief Officer of the Consumer Council, the National Citizens' Advice Bureaux Council, the Consumers' Association, the Federation of Consumer Groups, the Women's Advisory Committee of the British Standards Institution and the Institute of Weights and Measures Administration. I believe that in that sort of atmosphere these people could explain why they have not had this confidence, with the consequent lack of co-ordination and co-operation. I believe that these six people, together looking at this whole problem, with nobody laying down the law, could bring about a new era. Without such a meeting there will have to be a new plan; but obviously we cannot go into that to-day.
My Lords, I have many friends of long standing in the consumer world. At all times—for ten years in another place, and particularly for our original debate here seven years ago and for that of to-day—these friends have given me comments, advice and their unstinted help. I like to think also that they have given me their trust, and I hope that by being frank to-day I have not lost them. I beg to move for Papers.
3.25 p.m.
LORD MOWBRAY AND STOURTON: My Lords, we are all deeply grateful to the noble Baroness for raising this subject, which we know is very dear to her heart. If it is not impertinent, I should like to congratulate her on covering such a wide field, and also congratulate myself in that I anticipated that she probably would cover a wide field and that, therefore, such a far-seeing approach from myself would not be needed. I have certainly not been preparing this speech for three months. I think it is well known to

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your Lordships that this is the first time I have ventured to enter on this subject in your Lordships' House; but I am slightly heartened in that I suspect that this is also the first time the noble Baroness, Lady Phillips, has taken on Lord Brown's mantle in this matter. But I may be wrong in that.
At any rate, to-day we are going to survey this field, which for 18 months now has been strengthened by the Trade Descriptions Act of last year, the results of which are now beginning to be seen. Last month the President of the Board of Trade described that Act as, "The consumer's charter, the housewife's friend, the motorist's delight—all rolled into one.". In fact, he thought it ought to be known as, "The people's pal". He then described it as the most effective little Act that the Labour Government had introduced. I think, with all that, he might well have called it the most effective and gallant little Act, as it obviously had to do so much manful work. struggling against the huge giants of Mammon and Corruption, with all their temptingly false sugary attractions.
However, I was happy to learn from the same right honourable gentleman, the President of the Board of Trade, that in the nine months concerned only 295 cases had to be brought before the courts, and that only 384 cases were pending. I trust, my Lords, that this means that this gallant little Act has put to rout all those false deceivers, and not that the Weights and Measures authority are unable to cope. I wonder whether the noble and learned Lord on the Woolsack, or perhaps the noble Baroness, Lady Phillips, will be able to tell us that the recruiting situation for qualified staff in the Inspectorate of Weights and Measures has improved since the Mallaby Report came out, which indicated, I think, that in London they were something like 33 per cent. under strength. Hearing to-day and yesterday of the six inspectors who have to travel the globe inspecting the canned meat which is to come into this country from foreign sources, one is rather led to suspect that the Inspectorate may still be somewhat short of qualified inspectors. I only hope that these gentlemen may be qualifying for "Her Majesty's Greyhounds", as they must do more travelling than many of Her Majesty's diplomatic messengers.
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My noble friend Lord Drumalbyn will discuss in more detail the involvement of Weights and Measures inspectors, in which matter he has always taken an enormous interest and about which he knows more than most Members of this House. It is still early days now for the full picture to have emerged, but we on these Benches hope that it is the Board of Trade who are supervising the decisions as to when to prosecute, or when to prod the erring manufacturer or retailer back on to the paths of righteousness. We hope it is not being left to the local Weights and Measures authorities to decide in lonely isolation their various policies, with all the differences over the country which would then arise. I think this is a reasonable thing, which has been expressed in both Houses in the past. It is too early for us to know, but perhaps Her Majesty's Government may know the trends before the facts are published, and may be able to help and advise us.
There are still various professions which, for various reasons, go on using inaccurate descriptions quite automatically because the phraseology has become commonplace jargon in their particular profession. I noticed that the housing correspondent of the Daily Telegraph was complaining this morning that many properties are described as "luxury" which by modern standards are just not the case. He quoted one or two instances which your Lordships can read for yourselves. Certain people —shall we say those who are in this country from abroad and who are hopefully seeking temporary work and temporary accommodation —do not always find it easy to check up on these descriptions in person. In the case of renting, we know that, especially if it is temporary, the landlord is apt to ask for rent in advance. If one has paid rent in advance for a luxury flat only to find that the luxury consists of one radiator which is hardly working and a lavatory in which it is necessary to climb on to the seat to operate the flush, then, if the renting is temporary and one cannot prolong one's stay and does not wish to risk the extra money involved in suing in the civil courts, one may suffer grave injustice through this false description. I am sure that there is a great weight of public opinion ready to prod the Consumer Council or the Weights and Measures Inspectorate (whichever

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body has this duty) into enforcing the regulations. I think that house agents are perhaps one of those professions who are living in the past in their descriptions.
I come now to another matter which is close to most consumers in the country. This is the money in our pockets. Admittedly, by the time the tax man, the insurance stamps, S.E.T. and a hundred and one other commitments have been given priority there is not much money left. But what finally gets into the pocket is very personal. It may seem a small matter to your Lordships, but even at this late stage cannot some consideration be given to what the Consumer Council and most of the shopkeepers in this country have asked for—the retention of our humble "tanner" as a 2½p piece? I do not suppose that we shall get any cheer from the answer to this plea. In any case, it may not be long before inflation makes it an unnecessary coin—but it would be nice if we could retain it. It might even help keep down the cost of living half a point.
I turn now to another coin of our decimal system, the 50p piece. I have yet to see on any side of the House a single real friend of this coin. We all agree that the design is good; that perhaps it is nice to look at when mounted on velvet in a little box. But owing to its size and likeness to the florin, it is very unpopular. Would it not be possible for Her Majesty's Government to give a nudge to the Decimal Currency Board over this matter? I do not see why it should not be possible for the 10s. note to be preserved in the form of a 50p note. I have been told that the 10s. note is a horrible, dirty note and that it gets used up twice as fast as the pound note. But, my Lords, it is used more often because it is popular. People use what they like.
Is it not the case that what the consumer likes is good? I am a believer in supplying people with what they want. The French are very particular about their money—they even have a one-centime and a five-centime piece! If they find it possible to have a five new franc coin and a ten new franc coin in currency alone with a five new franc notes and a ten new franc note, surely we can. In any case, in this climate people do not want heavy coins in their pocket or handbags. Notes are easier
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to carry. I have not yet seen a reasonable argument why the consumer cannot have a 50p note —excepting the one that the note is going to be more expensive to produce.
I thought that the noble Baroness, Lady Burton, was a little unkind to the Consumer Council. Only for a moderately short time of its existence has it had the powers of advice and action behind it. I agree with her that it is very important that the Consumer Council should work alongside the Citizens' Advice Bureaux and not separately. To that extent, I think that her idea of the President of the Board of Trade working alongside these six heads is very good. I noted that she informed us that the noble Lord, Lord Donaldson, is going to discuss those considerations which, I know, have been worrying the Consumer Council and the Citizens' Advice Bureaux very much. I can safely leave that matter to the noble Lord.
I should like now to draw your Lordships' attention to the matter, already mentioned by the noble Baroness, of those recommendations of the Molony Report which have not so far been acted upon by Her Majesty's Government but with which, we have been told, they are in general agreement. These refer to the desirability of amending certain clauses in the Sale of Goods Act 1893. In Chapter 12 of the Molony Report on Consumer Protection the Committee drew attention to the many cases of buyers who were unable to get full justice in the matter of manufacturers' guarantees. These guarantees are freely given and are expected by the buying public. When we buy our new car or television set we all expect to be able to get redress, if necessary, within the period of the guarantee. By reason of the well-known name of the makers, we have probably been led to accept the guarantee as being as secure as any written word can be in our imperfect world.
In most cases we, the consumers, are satisfied that all that is necessary in the way of repair will be done. But there are certain cases, luckily not frequent, where the new buyer cheerfully signs the guarantee and returns it; but, in the words of the Molony Report (paragraph 426):
"He does not realise the significance of his signature being asked for to secure for himself a supposed advantage—instead of his being

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the recipient of an executed document. The consequence may be that he unknowingly signs away valuable rights and thus deprives himself of a legal basis for subsequent complaint."
The problem of the Molony Committee was to consider whether this contracting out should be allowed to continue. After considering the pros and cons they came down in favour of accepting the need to ban contracting out. Subsequent to that Report, the President of the Board of Trade sought further advice from the Law Commission and the Scottish Law Commission in 1966. They, in their turn, had further advice from the Working Party set up in the same year under the chairmanship of Lord Kilbracken and Mr. Arthur Martin, Q.C. This Working Party also found the Molony Committee proposals justified, and they, by a majority, supported a ban on contracting out, which they said should be absolute and unqualified. The Law Commission and the Scottish Law Commission, in their Report laid before Parliament in July of this year dealing with exemption clauses in contracts, recommended that Sections 12 to 15 of the Sale of Goods Act 1893 be amended. So far as private consumers are concerned, they too supported a ban on contracting out, with the sole exception of matters applying to public auctions. Draft clauses to amend the Act were included in their Report. They even gave alternative drafts for Her Majesty's Government and the Houses of Parliament to consider.
We on these Benches should be grateful if the noble and learned Lord who sits on the Woolsack would give us tidings of when the private consumer is going to get the benefit of this suggested legislation. May I express the hope that the noble and learned Lord, bearing in mind the approaching festive season, will be able to give us tidings of joy in the form of an assurance that Her Majesty's Government will not only introduce legislation on this matter but carry it through in this Parliament.
3.40 p.m.
LORD AIREDALE: My Lords, may I begin by congratulating the noble Lord, Lord Mowbray and Stourton, on his self-confessed "maiden speech" on this subject. I certainly agree with everything the noble Lord said about the 50p piece. At Question Time the other day, I ven-
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tured to suggest that it might have been better to have made the 50p piece the size of the half-crown, which is being withdrawn, instead of the same size as the florin, which is being retained. I did not get very far with the Government Chief Whip who was answering that day. I was told that I really ought to have another good look at the coin. Well, my Lords, I have had another good look at the coin, and I still suggest that it would be very much better if it were the size of the half-crown and not of a size which causes it to become muddled with the florin.
My Lords, I join with the noble Lord, Lord Mowbray and Stourton, in his congratulations to the noble Baroness, Lady Burton of Coventry, on her wide-ranging speech, with its wealth of practical suggestions, many of which I fervently hope will find favour. I cannot hope to have the wide knowledge of consumer problems which the noble Baroness has. I think the, best that I can do is to select one of these topics, one which both noble Lords who have spoken touched on, and to expand it a little. It is the matter of exemption clauses in contracts, or, as it is alternatively sometimes called, the practice of contracting out; a practice whereby manufacturers and traders sometimes introduce clauses into their contracts which exempt them from their ordinary liabilities under the law in respect of defective goods which they may supply and, correspondingly, denying to the purchaser, the consumer, the ordinary protection which the law wishes him to have in ordinary circumstances when he has the misfortune to be landed with defective goods.
I think that this is essentially a problem of the age of mass production. I imagine that in the days of horse-drawn coaches there were probably as many coach builders in the country as there are boatbuilders in the country to-day; and if you thought that a coach builder's terms of business were unfair and onerous, there was no difficulty in finding another coach builder. Of course, the trade knew this and it was a very unwise coach builder of those days who sought to impose burdensome, unfair conditions on a purchaser. But, my Lords, how different in these days of motor cars for the millions. The Molony Committee, reporting in 1962, as has already been referred

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to this afternoon, said this about motor cars:
"… the practice of contracting out is universal in the motor vehicle trade, and general in respect of electrical and mechanical appliances. In all these cases it is associated with guarantees or warranties' as the motor car manufacturers term them …"
I expect your Lordships are familiar with the fact that so often when you buy something like a refrigerator you get with it a rather expensively printed, impressive looking guarantee card; and you are told how important it is that within 14 days you should send this card to the manufacturers with your name and address filled in so that you may be quite sure that the valuable terms of the guarantee will be available to you should the refrigerator break down. My Lords, in many cases you would be very much better off if you threw the guarantee card into the waste paper basket and relied on the ordinary rights which the laws of England give you.
The Law Commission and the Scottish Law Commission, as we have been told, investigated this matter further. In 1966 they set up a joint Working Party, and in July of this year they published their Report which gives the conclusions of this further study of the subject of contracting out. They naturally referred back to the Molony Committee's researches, and in paragraph 68 of the Report of last July the two Law Commissions say:
"On the strength of the evidence which they had collected, the Molony Committee declared themselves compelled to view the practice of contracting out as a general threat to consumer interest, in the sense that 'heavy and irrecoverable loss may fall upon the consumer who is unlucky enough to get a defective article' … they found an overriding argument in favour of prohibiting contracting out'. The mischief was that this practice enabled well-organised commerce 'consistently to impose unfair terms on the consumer and to deny him what the law means him to have'."
The Report goes on to say that the consumer
"found it difficult and sometimes impossible to avoid submitting to the terms of business universally adopted, because he had no bargaining power of sufficient weight."
In paragraph 72 the Report says:
"Our Working Party found themselves in agreement with the Molony's Committee's main proposal that in sales to private consumers any exclusion of the statutory conditions and warranties should be void."
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In paragraph 75 the Commissions say.
"…we endorse … the Working Party's proposal for a general ban on contracting out in sales to private consumers."
For good measure, in an Appendix to the Report—this has already been mentioned —the Commissions published a draft clause which they put forward as the basis for legislation. Here we are early in the Session with a good deal of Parliamentary time before us, and it would seem that there is an overwhelming case for banning this practice of contracting out. But I have to face the fact that two possible defences against acting now are open to Her Majesty's Government if they are not minded to proceed quickly.
First, the two Law Commissions are still studying the question of contracting out, even in cases of negligence on the part of manufacturers and suppliers. Secondly, they are still further considering contracting out in cases of contracts for the supply of services as distinct from contracts for the sale of goods. I should have thought that if you were in favour of banning contracting out in the case of the sale of goods you would also be strongly in favour of banning contracting out in the case of the supply of services. If you travel by public transport; if you send your clothes to a dry cleaner; if you leave your hat or umbrella in a hotel cloakroom or the cloakroom of an exhibition —who does not do all these things?—surely you are entitled to the same fair trading, fair dealing, to which you ought to be entitled if you buy goods. Therefore, I should have thought that in the interests of the consumer there was an overwhelming case to proceed now with the banning of this practice of contracting out. I do not believe that anything that could be done now for the consumer would be more worth while, and I would say to Her Majesty's Government, "Do not let us wait any longer; we have been waiting since 1962 when the Molony Committee reported. Let us get on with it now."
3.50 p.m.
THE LORD CHANCELLOR (LORD GARDINER): My Lords, the Government are grateful to my noble friend Lady Burton of Coventry for introducing her Motion this afternoon. It is a Motion which is always sympathetically received in all parts of the House, because we are

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all consumers now. Perhaps the attention which the Government pay to the question may be indicated by the fact that there are two Government speakers in what is not a long list. May I apologise, in case I forget later, for the fact that, owing to engagements which I am unable to escape, I may have to leave before the end of the debate. May I also apologise for the effect of the Act of King Henry VIII, which always makes me seem so discourteous to the Liberal Benches behind me.
My noble friend Lady Phillips will reply to the debate as a whole and I do not propose to deal in general with what I might call the Board of Trade problem. I have always felt strongly—and I think most judges and lawyers do—about the so-called guarantee. The noble Lord, Lord Airedale, is of course quite right in saying that the primary object of giving a guarantee with a beautiful scroll on top, and of getting the buyers to send a card acknowledging having received it, is to take away the Common Law rights which we should have as buyers, if we had not been foolish enough to accept the guarantee.
I was delighted, I remember, when my right honourable friend the then President of the Board of Trade asked the Law Commission to go into the whole subject. As your Lordships know, they reported in July—another example, perhaps, of the good use of the Law Commission. These are entirely matters for the Board of Trade and not for me, though it is correct, as my noble friend Lady Burton of Coventry said, so far as inertia sales are concerned, that Mr. Davidson has drawn sixth place in the ballot in another place. That is a good augury, I think, for his success.
I propose to deal mainly with what I do know, which is the problem of the courts in relation to small claims, the legal problem there enforceable. The case which is made in relation to that is that there is too much difficulty, cost and uncertainty for consumers fighting small claims. The broad answer is that it is what in another context lawyers would call a true bill. I think it is right. It is said that when people go to a solicitor they are advised not to press a small claim. The complainant says that the thing does not work properly, that there is some defect. But the solicitor replies
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that there is not a lot of money in it: it is something less than £30, that expert evidence would have to be called, and that it is not worth while to litigate about a small amount like that. I think that this does happen. The sample given in the inquiry made by the Consumer Council was a very small sample of about 2 per cent.
The report of the inquiry commented on the fact that nearly all county court actions seem to be by firms and companies, rather than by individuals; by firms against individuals, rather than by individuals against firms. But the county court is primarily a debt-collecting court. To most claims there is no defence at all, and where a defence is filed it is sometimes put in by consumers simply to gain time. But the general complaint is, I think, justified. The question is: what is the remedy?
If I may take first those suggested by the Consumer Council, my noble friend asked me to say something about small claims courts. It is right that in America, in some States, at all events, there are small claims courts which are held in the evening. Usually, nobody is represented; the person who decides is a lawyer who does it for nothing in his free time. At first sight, this idea sounds attractive, but the article in Focus also demonstrated the difficulties. It said that these courts are used by ill-educated or illiterate people and that, being unrepresented, they have usually left the more relevant documents at home. It is all very rough and ready, and often the consumer is pushed into some sort of compromise which does not really do justice to his case. There would be a further difficulty in this country, in that the proportion of lawyers in America is immensely higher than the proportion here. As your Lordships may know, we are very short of lawyers. All solicitors are over-worked and I think would not have time to do work of this kind. They are all doing as much as they possibly can, and they are short staffed.
The same article suggests that there should be local advisory services. I am not an expert on consumers' organisations, though a great admirer of them from a distance; and I also admire the C.A.Bs. It is suggested that the county court registrars should act as conciliators. In fact, they already do, if they can get

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a sensible settlement. In my experience, the registrars and county court staffs are extremely good at helping those who are not represented. It is then suggested that there should be arbitrators. The experience of lawyers about arbitrators—and we have had a good deal of experience—is that in the end they do not turn out to be any cheaper than the courts. If parties have lawyers, they have to be paid; and the arbitrator also has to be paid, whereas the judge does not. It is an illusion to think that arbitration is cheaper.
It is also suggested that there should be neighbourhood law firms. I have been fully into this point, and I do not think that such a scheme is at all well suited to our problems here. We in this country have a proper system of legal aid, and there is no legal aid in the United States. I think that the answer is simply that we should extend legal aid and advice. We have already extended the jurisdiction of the county courts, and if all the recommendations of Lord Beeching's Royal Commission are accepted it will be extended still further. That means that actions now tried in the High Court will be tried more cheaply in the county court. As my noble friend said, only this last Session we have doubled the jurisdiction of the registrar, and your Lordships may remember that it was only in the last Session that I made some Orders applying legal aid to forms of proceedings to which it had not been applied before.
When we are talking about extending legal aid we have to look at the background, and the first thing we have to recognise is that in this country we have an appalling shortage of lawyers. There are parts of the country where there are simply not enough barristers to go round; and, as I have said, solicitors are all over-worked. Departments are advertising for lawyers and cannot get them. There are many unfilled Government legal posts. The only people who can get lawyers are the Law Commission—perhaps because the work is so interesting. We are short, as we all know to our cost, of Parliamentary draftsmen. While some of the complaints made against solicitors, that they do not seem to get on with doing what clients want them to do, are justified, the main reason is that they simply cannot meet all the work
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they have to do. That is one background fact which we have to realise.
When it comes to county court work, the suggestion that solicitors shy off county court is true; and for a very simple reason. The Prices and Incomes Board have recently reported that in their view some of the charges made by solicitors who do conveyancing of large properties are too high. That statement, naturally, the Press widely publicised. What the Press have not publicised is the equal finding that solicitors lose money on every county court case they undertake. This is for the simple reason that their charges have not been increased for thirteen years. Do any of your Lordships know of any other group of men, whether professional or otherwise, whose charges in some field have not been increased for thirteen years? Naturally, solicitors lose money, and in their Report the Prices and Incomes Board says, in paragraph 34:
"Some firms are refusing to take on county court work, and this would apply particularly to smaller cases where the level of fees is known to be specially unremunerative. From the returns in our present survey, we find that three firms in every ten appear to have no county court work at all. This figure is based on a single quarter and cannot be taken as representative of a full year, but it is clear that the proportion is now higher than in 1966 when it was only about half as great. This roust give cause for serious concern, and indicates that a realistic solution to the problem of county court costs is urgent and should be put into effect with the least possible delay."
This is obviously part of the difficulty. I never like refusing to see anybody. A group of solicitors wanted to come and see me recently. I did not recognise the name of the man who wrote to me, but I saw them—there were some six or seven of them. When they came I found that they were old friends of mine, in the days when we were all young together in the Haldane Society or in the Society of Labour Lawyers. They were all solicitors who act almost entirely for employees and not employers, or for tenants and not landlords. When they have litigation, they litigate in the county court and not in the High Court. If they do conveyances, they are few and at the lowest end of the scale, which the Board recommend ought to be increased. These solicitors were wondering how long they could stay in business. They regard what they do in life as partly a social service. They do not like to say

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to a client: "I am sorry, but I cannot take a county court case because I shall only lose money on it". They simply take the case and lose money on it. They were wondering how long they could go on doing this. It is not much use saying to solicitors like that: "The West End solicitors who do conveyancing for large properties are making too much money." This, I think, is the real answer—legal aid and legal advice.
Then I have, in conclusion, to say something about finance. I do not think there is any doubt that our system of legal aid is the best in the world. We used to have this silly system under which if a man was really poverty-stricken he got the action done for nothing, but otherwise he could get no help to all. Now a man has to contribute what he can, but the State will pay for the rest. This is surely an elementary feature of justice —because what is the good of passing Acts of Parliament giving people legal rights if they cannot afford to enforce them? If you cannot afford to enforce your legal rights, you may as well throw them into the wastepaper basket. It has worked admirably.
In the end, of course, there is something for the taxpayer to find. Most accident injury claims succeed; the defendant pays the costs, and the action does not cost the State anything. Most of the money the taxpayer has to find goes on undefended divorce, where the petitioner is a wife and cannot make any contribution because she has not the money to do so. But legal aid has been gradually extended. It started in relation to most actions in the High Court. Then came the time when a Government said: "You can have a bit more money for legal aid", and aid was extended to county court actions. Now it has been extended to what one may call the civil side of magistrates' courts. Then there were these three or four additional kinds of action to which we extended it by Order this last Session.
My Lords, the financial position is that, having started in 1950, until 1960–61 what had to be found was always £1 million-plus. The amount went up every year, but it was always roughly that figure. Then the next year it was £2 million; the next year it was £3 million; the next year it was £4 million; the next year it was £5 million; and the next year it was £6 mil-
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lion. Then, of course, legal aid was introduced for criminal cases, and I think the current figure of the amount to be found is about £9,900,000. Extending the system is simply a question of finance.
My Advisory Committee, of which the noble Baroness, Lady Emmet of Amber-lay, is chairman, made a report, some time ago now, recommending, first, that there should be an alteration of the basic figures, particularly for the lower limit, because those figures have not been changed for nine years; and, secondly, that legal aid should be applied to proceedings before the Lands Tribunal. But it is all a question of amount. As your Lordships know, Government expenditure has to be curtailed, and it is a matter for consideration by each Government, and particularly my right honourable friend the Chancellor of the Exchequer, whether we can do it.
Legal advice has never really got properly started. You go to a solicitor, and if your income is less than a certain figure you can get his advice for a sum that you can pay. One of the difficulties is that what the solicitor gets has never been increased; and here again the Prices and Incomes Board say, in substance, that what the solicitor gets should be doubled. But we really do not get in early enough. It is a difficult problem. How do you get in touch with the poorest section of the community of all? If they have a contract when they buy something, and do not read it, they do not know that they need legal advice. This, as I say, is a difficulty. We must, therefore, expand legal advice in every way.
Taking full advantage of the Citizens' Advice Bureaux, the Law Society have put forward a very practical scheme which would lead to a great expansion of legal advice to the people who most need it. My Legal Aid Advisory Committee are even now in the middle of reporting to me on this, and I hope to be able to publish their report next month. The Law Society's scheme seems to me an admirable one, but it would cost £2,400,000 a year. No doubt it seems a shame that lawyers require to be paid for what they do, instead of not charging anybody and living on nothing, but I am afraid that if one wants somebody with the technical qualifications one has to pay for them. This is the basic difficulty.

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When a lawyer says that it is not worth fighting a case under £30 because of the costs, he is right. I was a little surprised when my noble friend Lord Silkin, in an observation referred to by my noble friend Lady Burton, complained that it seemed ridiculous that an action involving about £100 might involve costs of £100. Whatever the cost is, it is not due to the fact that lawyers charge too much, because the Prices and Incomes Board have shown that they do not get enough. I repeat, it is a question of finance. Nobody is more anxious than I am to see that both legal aid, particularly at the level of the lowest cases—because if the consumer is right he wins his action, and his costs, and therefore the Legal Aid Fund's costs, too, will be paid by the loser—and legal advice are greatly extended. My Lords, I conclude by saying again how grateful we are to my noble friend Lady Burton for having introduced the Motion this afternoon.
4.10 p.m.
BARONESS ELLIOT OF HARWOOD: My Lords, I also should like to thank the noble Baroness, Lady Burton of Coventry, very much for introducing this debate, and for the most thoughtful and interesting speech which she has made, to which I have listened with the greatest possible interest. The noble Baroness is, if not the greatest. certainly one of the greatest experts on this subject, and has done more than anyone to bring the matter in front of the public many times. It so happens that we have not had a debate in this House on consumer affairs since the debate that I think she inaugurated (or perhaps I inaugurated it, I am not quite sure) in 1966—quite a long time ago. So to-day is an opportune moment for us to review these questions. In taking part in this debate to-day, I speak for the first time not as a member of the Consumer Council, or as its Chairman, since I gave up the chairmanship about a year ago.
Before I come to deal with one or two points which the noble Baroness has raised, and which I think I can deal with since they were matters which were raised originally when the Council started, if the House will bear with me I should like to say one or two words about the work of the Consumer Council to-day. I have in my hand the Report of the Council, which I think is excellent reading. I
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should like to congratulate my successor, the noble Lord, Lord Donaldson of Kings-bridge, and his excellent staff, on the work that they are doing and plan to do in the future. The Report is very good reading indeed when you think that it is only the sixth annual review of this organisation. It takes a long time to get a new organisation established in this country and, as I say, this Report is excellent.
There are one or two matters I should like to pick out from the Report, because they follow on so much what I hoped would happen when we started some five or six years ago. There is a large section on personal service to the individual, and a whole range of subjects which are of the greatest possible value to individuals. The first group is the health and safety section, dealing with food standards and labelling. This is a most important matter, as has only recently been brought to our notice in connection with the use of cyclamates in various foods. Then there is an excellent and interesting paragraph about children's clothing, and about the changes to alternative sizes (which we always wanted) not based on age, but on height, weight and the actual size of the child.
There is a paragraph about the safety of electrical appliances and their uses, and also a paragraph about safety of toys. We began dealing with these matters about five years ago. They have now become part and parcel of the work, results have been established and are of value to the individual. There is a section in the Report dealing with the market place, and many subjects listed there are extremely interesting. Of course, they are new subjects which did not arise when I was Chairman.
I notice that the Council have not been successful in trying to prevent the closing of banks on Saturdays. This occurred in Scotland a year before it occurred in England. I knew at the time that it would be exceedingly inconvenient for ordinary people, for whom Saturday was the one day when they could get to the banks, but we could do nothing to prevent this happening, and I am afraid that the people in England are having just the same disagreeable experiences as we have had in Scotland for the past year and a half. Many interesting studies have been carried out on various important matters.

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There are studies on carpets, for in-stance, about which many complaints were always being sent to us. There are studies on footwear, which is another matter that is continually coming up. There is a new section about transport, which interested me very much, with questions connected with taxicab companies and the public.
These may sound small things, but I am picking out only one or two that were new to me and interested me very much indeed. There is a paragraph about the House-builders' Registration Council. There are now 11,000 builders registered, which is a splendid increase, and a matter which shows how important it is that we should try to keep the standards in house building as high as possible. The Consumer Council have helped tremendously in backing that Council. There are also paragraphs about the TELTAG scheme, which interested me very much. It is only just starting, but it is off to quite a good start. The noble Viscount, Lord Hanworth, is speaking in this debate, and I know that he is largely responsible for this section of the Consumer Council work, and hope he will be able to tell us more about it.
There are one or two matters which I think the noble Baroness, Lady Burton, touched on, and on which I should like to elaborate. I was delighted to see in the Report emphasis laid on the education of the consumer. This aspect of the Council's work is of enormous importance. I entirely agree with those who have said that an informed and knowledgeable buyer is just as important —and is more important to the manufacturer and retailer—than any other kind of buyer. As the noble Baroness has said, when shoppers complain and when inquiries are made as to what the complaints really stand for, it is often found that the goods or equipment purchased, if of a durable character, like electrical equipment, has been badly and wrongly used, and naturally the result is not satisfactory. Only an educated and informed shopper can avoid those pitfalls. This is one of the subjects to which the Council is devoting a great deal of attention.
How can the Council do more? How can they be more important and helpful in this whole field of consumer work? The noble Baroness, Lady Burton, has suggested that more can be done. Every-
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body will agree that always more can be done, and those who are enthusiastic in this matter are always anxious to do more. But there are difficulties, and I should like to say one word on the subject of finance. The total budget of the Consumer Council, for all the work it has to do, is only £231,800-odd. When you realise that the Council is working in the commercial world, the advertising world, the world of huge retailers, and so on, that tiny sum is minute compared to what is expended on advertising or what is expended in the commercial world on selling to the public goods and services in which the public are interested. It is true that the Consumer Council is not selling anything. But it is selling itself, and that is very important indeed. It means that when you have a budget as small as that you have to choose all the time on what you spend your money. There are any number of things one would like to do, but when it comes down to financing inquiries, or financing whatever it may be in the interests of the consumer, and in helping the Council, it is impossible to do everything. So you have to choose; and the choosing has to be done with scrupulous care. It also means leaving out, and there is a great deal one would like to do but which one cannot do because something has to be left out.
There is one Association of which I am vice-president and which is one of the co-operative organisations, the Consumers' Association. This is a splendid organisation, as we all know, and those of your Lordships who subscribe to their magazine Which? will know that it has a huge circulation and does very valuable work. But when I tell your Lordships that the current Annual Report of the Consumers' Association states that the sum of £300,000 is expended on membership and on Which? alone, it gives you some idea of the difference between the amount of money available for the Consumer Council and the amount of money which is spent on that one item by the Consumers' Association. I do not grudge it to them, because I think it is an excellent publication and they do a splendid job. But it is only one item with which they deal. The Consumer Council has £231,800-odd to do everything.
The second matter is one to which the noble Baroness, Lady Burton of

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Coventry, has referred and about which I should very much like to talk. I mean the methods by which complaints from consumers are dealt with and reach the Council. The noble Baroness is absolutely right when she quotes the Molony Committee's paragraph on the subject of the Citizens' Advice Bureaux. When I took over the chairmanship of the Consumer Council, as the first Chairman, the first thing we did was to work in very close touch with the Citizens' Advice Bureaux. I made many speeches, up and down the country, in those first years in which I said that the Citizens' Advice Bureaux were the eyes and ears of the Consumer Council. and everything we could do to help them we should do; and I hoped that they would pass on to us their reports, and so on, so that we should be able to help them.
As the noble Baroness, Lady Burton, said, this has not worked out in exactly the way which I, as the first Chairman of the Council, and she, as one interested in how consumer complaints can be dealt with, would have liked. There are one or two reasons for this which I can explain. The noble Baroness said, perfectly correctly, that the Consumer Council, by its constitution, is prohibited from dealing with individual complaints; it cannot do that, and has never tried so to do. The Citizens' Advice Bureaux are the people to deal with individual complaints. But they have often said to me—and I am sure they would be the first people to support this view—that they are often hampered by not having enough expert knowledge on the spot to deal with difficult individual problems. The noble Baroness has said that she thinks they deal with about 90 per cent. of the cases reported to them, and that about 10 per cent. are beyond their powers. This is in a way a very fine percentage, because 10 per cent. is quite a reasonable number. On the other hand, 10 per cent. of dissatisfied complainants can make a great deal of trouble.
One of the difficulties about passing on information by the Citizens' Advice Bureaux to, let us say, the Council or any other body is that the Citizens' Advice Bureaux are not allowed to pass on—or at any rate they do not do so—any names of firms or people who are being complained about. No name of an
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organisation or of a commercial firm or any other name is ever passed on. They operate like this because they wish to be considered an impartial body, and therefore do not want to be involved in any kind of controversy with a commercial firm or any other service about which there is a complaint. That attitude is perfectly understandable.
However, when it comes to the Citizens' Advice Bureaux passing on information to the Consumer Council and asking them if they will take up the complaint, the Council are of course enormously handicapped by not knowing who is said to be at fault or is being complained about. Again, the Council do not wish to take sides in any complaint until they know the rights and wrongs of the case. On the other hand, supposing there is a complaint about, say, "inertia selling", or doorstep selling, or anything else which is highly irritating to the public, if the complaint is passed on in a vacuum, with absolutely no method of pinning down who the offending seller is, what can the Council do to put it right? The position is very difficult indeed.
Unless it is possible for the complainant and the complaint to be identified, I do not think it is possible for the Consumer Council to deal with the complaint. This is one of the reasons why the present setup has not worked. It has not worked, with all good will on both sides, because if one side does not give a great deal of information, the other side has largely to work in a vacuum: and this is very difficult indeed. I think that if one is going to take up complaints one must know who the offending person is; otherwise I do not quite see how the matter is going to be dealt with.
As the noble Baroness, Lady Burton, has said, what has happened is that complaints have come only sporadically through the Citizens' Advice Bureaux, but more and more people get in touch direct with the Consumer Council office. On page 33 of the Report that I have here your Lordships will see that the number of direct contacts between the public and the office is growing every year. Whether it is done by letter, by telephone or by personal approach of some kind, this method of contact is going on all the time, and the Council are therefore able to deal directly, by letter or by telephone, with some complaints. The way in which the information from

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the Bureaux is handled, in addition to the cases which the Council handle themselves, is that it is passed on where it can be, but without any particularisation of the difficulty.
One of the ways in which we could improve on this method would be by seeing that the Consumer Council have offices in other places besides London. I realise that this would involve slightly more expense, but it would enable the Council to be much more accessible to the public, and I believe that this would be valuable from the consumer point of view. I was interested to see in the Report that the first area where the Council would like to work is in Scotland. This would be excellent. I cannot believe that it would he very expensive; not a very big office would be needed, just a small office. It would be able to keep in close touch with the other consumer organisations and would also be a centre, as the Consumer Council in England is a centre, for opinions and work. Matters could then be dealt with much nearer to the public than would be the case if the only offices were in London.
I remember that when I was on the Council we hoped to have a number of regional centres. We should have liked, for instance, to have centres not only in Scotland and in Wales, but also in either Manchester or Birmingham, the great Midlands area, and possibly in Bristol or elsewhere in the West. It seems to me that if we embark on a reorganisation of local government, as it appears we may do, both in Scotland as a result of Lord Wheatley's Report and in England as a result of the Redcliffe-Maud Report, now is the time to consider whether or not in the new regional set-up there should be some regional offices of the Consumer Council. I am quite sure that they would pay handsomely in a return to the public and also in a return to those who are interested in consumer affairs.
LORD DRUMALBYN: My Lords, will my noble friend allow me to ask her one question? I should like to know exactly what she is proposing. Is it her proposal that in future these regional offices should be able to deal with particular individual complaints from consumers, and that the terms of reference of the Consumer Council should be altered to enable them to do so?
BARONESS ELLIOT OF HARWOOD: I cannot speak for the present Council because I am not on it, but certainly when I was on the Council we did not envisage altering the constitution in order to deal with individual complaints. We thought we should be much nearer to the commercial, retail and servicing worlds and to the local authorities if we had a regional office than if we always operated from London. The noble Lord:, Lord Donaldson of Kingsbridge, may be able to answer that question better than I can, but I do not think we had actually considered altering the principle of not dealing with individual complaints, because that would mean cutting across what is done by the Citizens' Advice Bureaux to some extent, and we should not want to do that. Also I think it might entail employing too many people in the office.
The noble Baroness, Lady Burton, mentioned co-operation between the organisations dealing with consumer affairs. I do not know whether she realises how much co-operation there is. It may be three years ago now (indeed it may be four) when the membership of the Council was being reviewed—I think three people go cut every third year, although I am not quite certain what the constitution is at the moment. We took great trouble to get someone on the Council who, I notice from the annual report, is still on it at the present time. I thought it would be very useful to have him on the Council, because apart from the fact that Professor Beresford is a highly knowledgeable person in many fields, he happens to be the Chairman of the Yorkshire C.A.B.
In the other organisation, the Consumers' Association, we used to have, and I think it is still carried on, a meeting between that Association and the Consumer Council every year. The two Councils met, we had a tremendous heart to heart talk and we made plans in which we indicated to each other the lines on which we thought we could best co-operate. We were not trying to do the same things, because that would he absolutely useless, and in any case the Council has no money to do the things done by the Consumers' Association. However we had those regular meetings and I think they still continue.
In regard to Weights and Measures and local authority services I must, in those

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five years, have addressed at least eight or ten meetings of Weights and Measures inspectors. I toured the country, having general meetings with people interested in consumer affairs, and always inviting, of course, all the organisations that were interested in this subject. Those meetings grew in momentum. We started with rather small meetings, because then it was only in the initial stages. I vividly recollect the last meeting I addressed—and I may say this was not because I was the speaker. It was at Newcastle, and we thought we were going to have 200 or 300 people present. It turned out, however, that the number of people who wanted to attend was so great that we had to take a hall to accommodate the 900 people who were present. So in one area alone—the North Eastern Region —there were 900 people interested. I thought that was gratifying. I see in the annual report that this type of co-operative meeting is being continued. There are reports of two—one in Sheffield and one in Bristol—which also, I believe, were on rather a large scale. So the Weights and Measures inspectors and the local authorities are all brought in, so far as is possible.
Every time I went to a meeting I also addressed—or hoped to address—a group of the C.A.B. I remember doing that in Birmingham, Manchester, Liverpool, Bristol, Newcastle and Edinburgh—I cannot remember any more. but I vividly remember having special meetings with the workers in the C.A.B. and having as close co-operation as I possibly could. We tried to have as wide a spectrum as possible of organisations interested in and dealing with consumer work. There were also other organisations, such as the Electrical Association for Women and the Gas Council. I am sure this co-operation is still carried on.
I have here a most interesting article by Mr. Roger Diplock of the R.T.S.A. I entirely agree with the noble Baroness, Lady Burton, that nobody has done more work or been more helpful to the retail trade, or to the consumer, than Mr. Diplock. At the end of the article he says:
"When some of these questions have been discussed in depth in the House of Lords, it may perhaps be realised that the great majority of retail establishments not only pro-
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vide sound service to sensible shoppers but would be out of business very quickly if they did not."
I cannot tell your Lordships how much I agree with those sentiments. Of course, the retail trade does give wonderful service to shoppers. In all the work which the Council do, in all the publications which they distribute and, I imagine—it was certainly so in my day—in all the speeches made up and down the country, it is emphasised that there is no question of organising a build-up against the retail trade. On the contrary, I always stressed that it was in the interests of the producer, the retailer and the consumer that there should be co-operation on all sides and, above all, an educated and intelligent shopper. This is the aim; and these three elements in consumer work are in no way antagonistic.
The noble Baroness, Lady Burton, has referred to the voice of the consuming public: how can it best be heard, and what are the best methods of achieving this? I believe that it is heard to-day far more than it has ever been heard before. In all our legislation someone in every Government Department must ask himself: "What will the consumer think about this piece of legislation?" On that point I should like to pay a tribute to the noble Baroness, Lady Burton, because she was the first person to make us consumer conscious, which she did by her staunch work in another place when she was a Member of the House of Commons. To-day it is rare not to find somebody looking at the consuming end of any legislation that is brought before Parliament.
Reference has been made to the Trade Descriptions Act, in which I took an active part and which I think, with certain reservations—namely, Section 11, as the noble Baroness, Lady Burton, has said —has been a great help to shoppers. I believe that the appointment of the consultative committees, if only they had more power, is an example of the nationalised industries' desire to consult the public. Incidentally, the Consumer Council carried out an interesting study on these consultative committees and came up with some excellent suggestions. Whether or not those suggestions have been acted upon I do not know, but the very fact that in the nationalised industries consultative committees are now

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established goes some way towards ensuring that they are all the time thinking about the public. But, of course, these committees have not enough power; as I think I said before, they have no real teeth, and it is time they were given more statutory power than they have to-day.
Then again, more and more is being put on the weights and measures departments of local authorities. Consumer protection is extremely important, and the weights and measures officers and their work are very important to the consumer. So I think that, on the whole, if one looks back one can say that a lot has already been done. That a lot more could be done is, of course, obvious. But unless more money is available, so that the Council can do more and do not have to reject so much because the necessary money is not there, the Council will always be hampered. I think it is amazing that the Council do as much as they do on as little money as they have, and I should like to congratulate the noble Lord, Lord Donaldson of Kings-bridge, and the officers of the Council on what they do.
Whether anything more would be achieved by the suggested meetings, as put forward by the noble Baroness, Lady Burton, at the end of her speech, I do not know. Certainly there is no harm in trying. One can always have conversations and discussions, and see whether anything better can be done. But in the nature of things, although the co-operation is being built up over the country, there is the difficulty of passing on information from the C.A.B. to the Council because of the nature of the way in which the C.A.B. work, which I think was not appreciated by the Molony Committee when they made these proposals. I believe that the C.A.B. do a splendid job. If they had more money they would do more. Nobody is more enthusiastic in their support than I am. But this liaison between the two, although it is there, is not as successful as it ought to be, because of the nature of the way in which the C.A.B. work, never divulging any names. not enabling the Council to "get after" any particular organisation or shop or commercial interest, or whatever it may be, to follow up these complaints.
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So, my Lords, I think that, given the difficulties and the lack of funds, and the fact that there is such a huge field, the amount that has been achieved by the Council is very remarkable. I congratulate the noble Lord, Lord Donaldson, and those who have contributed to this success, and I wish them every possible good fortune in the work still ahead of them.
4.43 p.m.
LORD DONALDSON OF KINGS-BRIDGE: My Lords, I understand that a certain newspaper, not one which crosses my breakfast table, suggested yesterday that it would be improper for me to take part in this debate as I am the part-time salaried Chairman of a public body concerned in the subject. This naturally concerned me. I have taken advice by studying the Addison Rules and the other hints contained in the little red book for the proper behaviour of Peers; I have consulted the Clerk of the Parliaments and my own Chief Whip, and I have consulted the President of the Board of Trade, whose predecessor appointed me, and none of those sources have suggested that it would be anything but right and proper for me to intervene. So ultimately one has to make one's own decision. I have made it and I am speaking. I think the House was the poorer for riot hearing my noble friend Lord Aylestone and the noble Lord, Lord Hill of Luton, in the broadcasting debate, and I am not following their example.
This is not a debate on the Consumer Council; it is a debate on consumer affairs. If it were necessary to expand on the work of the Consumer Council, this has already been done amply, first by my noble friend Lady Burton, in her opening remarks, by the noble Baroness, Lady Elliot, my predecessor, whom I am always glad to follow, whether as Chairman there or speaker here, and by the noble and learned Lord, the Lord Chancellor, in his reference to the small claims investigation. Any information your Lordships may require about the Consumer Council I feel you have, one way or another, already had.
I must declare two rather conflicting interests. First of all, I am Chairman of the National Executive Committee of the Family Service Units. Here we are constantly concerned with standing up for the family which has failed to look after itself and has fallen for the blandishments of

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efficient salesmanship, so that it is swamped by claims it ought never to have incurred and is heading for disintegration. There we are concerned with individual cases, and one could describe it, I think, as consumer protection taken to the extreme. I have seen too many cases where foolish families were bulldozed in their own houses into buying things they did not need and could not afford, to have much love for the honey-tongued salesman or indeed his cold-hearted employer.
The second interest which I must declare has already been referred to: that I am Chairman of the Consumer Council. We in the Council are concerned not with the particular but with the general, not with the merely protective but with the positive. Throughout its life the Council has been acting on a number of fronts lo curb the excesses of salesmanship which lead to debt and distress. But it is not concerned, and it is not allowed to be concerned, with the individual case. Its task is prevention rather than rescue.
It is concerned essentially to try to redress the balance of size which enables modern businesses to employ, perfectly properly, large legal departments and expert lawyers and pit them against the inadequate information available to the private citizen, and to employ large sums of money in their own interests which cannot be matched by the private individual in any way. When one sees the havoc wrought among families whose worst crime is lack of resistance to the spurious charms of the salesman, one is tempted to clamp down altogether on the kind of trading which leads to it: to ban credit buying, to suppress doorstep selling. But, of course, this would be absurd. We must above all things widen the choice of goods and services available to the public; make it easier for them to shop, perhaps by removing restrictions on shopping hours; make it easier for them to buy, perhaps by making credit terms less onerous. We must work by easing restrictions and not by increasing them.
Having disclosed these somewhat conflicting interests, which sometimes pull me in different directions, let me go on to thank my noble friend Lady Burton for having opened the debate in such an illuminating way, and in particular for painting it in on such a very wide canvas.
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We are not confined in our debate to consumer protection: we are concerned with information, advice, education, and all other constructive sides of this work. My noble friend has asked me some specific questions, which I will answer in due course; but first I should like to make one or two remarks of a general kind about the problems which confront those who concern themselves with trying to redress the balance in favour of the consumer.
Since the last war there has been an enormous growth in consumer consciousness, stimulated by greater opportunity, more money and the gradual removal of war-time restrictions. The statutory existence of consumers was first recognised, I suppose, in the Acts establishing the nationalised fuel and transport industries, under which consultative committees were set up. They were followed by voluntary and, on the whole, more vigorous organisations—outbursts, one might say, of consumer zeal. The Consumer Advisory Council of the British Standards Institution, with its Shoppers' Guide, was the first in the field, followed closely by the Consumers' Association, with Which?; and their success story seems to me to epitomise the whole growth of consumer awareness, at any rate of the more sophisticated part of the population. Which? now has a circulation of 600,000, and it claims to be read by 3 million people—no mean achievement in, I think, about twelve years.
There are about 80 consumer groups throughout the country, numbering some 20,000 members. That reflects a spontaneous generation of interest in this particular subject; a rather remarkable growth. Finally, in 1963, in response to the recommendations of the Molony Committee, the Consumer Council was set up by the Government. It is not a statutory body; it has no legal powers, but it is not exactly voluntary, either. It has no members, and it does not sell its services. It is financed by the Government, but most jealously preserves its independence and its right to come out strongly against Government policy when, as I regret to say sometimes happens, it thinks that the Government are wrong.
At the same time as this proliferation of consumer organisations there has been a leap forward in consumer legislation.

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We have had fairly detailed discussion already of the Trade Descriptions Act. I should like to say here that I endorse the misgivings of my noble friend Lady Burton about Section 11. I think that few noble Lords in this House were happy about that section, and it does not appear to be working very well. Otherwise, it seems that the Trade Descriptions Act is doing more or less what it was intended to do, which is a great deal; and I think, particularly from the point of view of the Consumer Council, the added zest and force given to the weights and measures authorities has been most remarkable and satisfactory.
Earlier, I referred to the first of the two basic problems which I see in assisting the consumer; that is, keeping the balance between freedom to compete for the consumer's custom and curbing excessive zeal which leads to abuse of the customer's confidence in the trader. It is difficult to protect the gullible without protecting the rogue, and it takes very accurate drafting to legislate to protect the innocent without unduly clipping the wings of imaginative salesmanship. Every time a Bill of this kind is brought in, after a year or two one finds the holes.
The second basic problem is how to reach the shopping public at large. We know that the Consumer Council's penetration is not as deep as it ought to be. In spite of the fact that it prints and distributes pamphlets and leaflets to the tune of millions, issued free through the C.A.B., through health clinics, through shops and stores, through women's organisations and through multifarious channels, its penetration is too shallow. As the noble Baroness, Lady Elliot, pointed out—and it would be out of place for me to stress this-it simply does not have the funds to compete more prodigally. Television advertising, which is generally thought to be the one thing which really does work in this country, is right outside its range. It has to rely largely on editorial publicity in order to give the warnings and advice which it wants to give.
The noble Baroness asked me whether I could tell the House the amount of money spent by the Consumer Council on publications and publicity. I should be happy to do so. In 1968–69, it spent £58,000; in 1969–70, it expects to be able
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to spend only £53,000. This includes a miserable £20,000 for promoting its informative labelling scheme, TELTAG. For the moment that is all it can afford. That does not mean that it cannot or does not speak for consumers at large in its representations to Government Departments, to trade organisations, to particular firms and to the Press. It takes a great deal of trouble to find out the experiences, as consumers, of representative samples of the population.
My noble friend Lady Burton referred to the research projects listed in the Council's Annual Report, and asked what they cost. They cost about £7,000. And in 1969–70 it expects to spend about £6,000. This, of course, is just chicken feed. But the surveys which are carried out in this inexpensive way are respectable and statistically valid, and based on the population as a whole, not just the middle-class intellectuals, whom it is sometimes contemptuously said are its only supporters, and people represented by the Council. It is worth while remarking here that even when agitation for reforms, whether statutory or voluntary, comes only from the concerned and articulate section of consumers (which it is fair to say it usually does) it is none the worse for that, because every time an abuse is nailed, it is nailed for the harassed housewife in overcrowded conditions as well as for the people who enjoy more gracious living.
The removal of exclusion clauses, about which the noble Lord, Lord Airedale, spoke, and with whom I entirely agree, is something for which the Council has campaigned ever since it was set up, and it is most gratifying to know that the Law Commissions have now reported in its favour. This will help everybody, and not just the more sophisticated. This is a most important matter. The work which is being done on the legal system on small claims, which my noble and learned friend on the Woolsack discussed in some detail will also help. Research into small claims work is being carried out at the moment by the Consumer Council and is only half way concluded. As the noble Baroness mentioned this point particularly, I will make a brief further reference to it; but the Lord Chancellor dealt with it so fully that I shall not spend long on it. As a result of the researches not yet finished it has been discovered that about 70 per cent.

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of actions in county courts are initiated by firms against consumers for debt, for goods or services. In this particular section of research, cases brought by consumers against firms were unable to be found. Individuals do not use the courts because the process is too expensive and too daunting. The system is not geared to an ordinary individual's bringing his own case, which is the only way to keep down expense.
The noble and learned Lord on the Woolsack referred to the American small claims courts. I do not suggest that they could be imported wholesale into this country. However, I do not accept the noble and learned Lord's allegation that all forms of arbitration are as expensive as ordinary forms of litigation. I certainly do not think they need to be. No doubt if they are wrongly conducted they may be; but I think it is most important not to accept the situation of the impossibility of bringing a case for £100 without spending £100. It really will not do. If that is the best that we can do we must think again. Thinking again means doing something quite different and doing something quite different probably means doing something not altogether different from the American plan. At least the parties can tell their own story to an independent arbiter and get a judgment, albeit one with which they may not be satisfied but which at least costs them virtually nothing.
We have already been told about the difficulties which confront the Consumer Council and the C.A.B. in the co-operation which Molony anticipated. My noble friend Lady Burton was absolutely right—and the noble Baroness, Lady Elliot, has confirmed this—when she said that this is not working in the way it was supposed to work. My own view is that the Molony Committee were wrong in thinking that it ever would work. I believe that it was not the right answer, because I do not think that people who are expert at social service, which is a difficult and demanding function, are necessarily particularly good at the rather niggling side of dealing with claims, with watches that go wrong and things of that sort, which in regard to 90 per cent. of the cases they deal with satisfactorily by ringing up the firm who are quite happy to put the matter right, but when
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there is something really wrong, which is what we want to get at, they are not able to do it. Of course, the confidentiality has made the information passed to the Consumer Council almost impossible to work on.
The Council is not allowed to deal with complaints. The C.A.B. are not equipped to deal with complaints. The county courts are too expensive and nobody will use them. So you are left with a major fault in the administration of consumer affairs, which quite rightly my noble friend has raised.
It may be that with the new powers they have under the Trade Descriptions Act, the local authorities will provide the necessary point of contact. Sheffield and Bristol, as we have already been told, in rather different ways are running consumer advisory services fairly successfully, and some twenty other local authorities, in different places and in different ways, are doing something about this along the same lines. The difficulty is that the weights and measures inspector, who normally the local authority employs on this matter, finds himself acting both as policeman and as supervisor. As we know from the experience of the National Agricultural Advisory Service some years ago, this is a very unhappy association, so that the answer is not obvious at the moment. I do not know what is the right solution, but in view of the stringency which my noble and learned friend on the Woolsack has once again brought to our attention, I must say that I think we are more likely to get something done through local authorities than in any other way.
I have referred to the other problem. that of how to balance protection against enterprise. Molony said that competition was the consumer's best friend, and I think we shall all agree—at least probably everybody in this House will—with that. But inefficiency cannot be cured by legislation; and inefficiency is the great crime against the consumer. What can we do? I suppose that all we can do is to encourage people to make themselves better informed about their real wants and to demand that the people who are selling them things say what those things really are. If you get "A" equalling "B" in this way, you get a satisfactory sale. The Consumer Council does

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quite a lot in this respect. But as my noble friend Lord Hanworth, who is a specialist in this particular subject, will deal with it later, I will say no more. Anyone working in this field, it seems to me, must walk a tightrope between too much and too little interference. In trying to promote the interests of the buyer without mortally offending both the seller and the relevant Government Department, one must regard pleasing two out of the three as a bull's-eye not often achieved.
My noble friend Lady Burton of Coventry raised one other question, apart from complaints—the question of co-ordination; and of course I agree with her that a better and stronger lead could and should be given by the Consumer Council. Goodness knows! we are trying to do it. But there is already very close co-ordination in many directions. Of course it should be closer; of course it should be more effective. But the Chairman of the Consumers' Association is one of my oldest friends, and we meet and talk constantly about this question of co-ordination. We had the C.A. people in our office only last week discussing Mr. Arthur Davidson's Bill on unsolicited goods. And I think that, as a result of this discussion, he is going to widen it (at any rate, I hope he is) to cover not only unsolicited goods, which are an obvious evil but one that rarely appears, but also something which is much more difficult: I refer to some of the less attractive examples of "inertia selling" which come about as a result of the activities of book clubs and gramophone clubs, which on the whole do a very good job but sometimes go a little too far. Then we have regular meetings with the weights and measures officials; and we frequently go to and speak at the consumer groups. I think the machinery is available, though I agree that we ought to make better use of it.
My Lords, I have said all I should. It is a difficult task, because one is so apt to go too far on one side or the other. But there is such an enthusiastic movement in this country of consumer groups (we have been through them all once or twice, these various voluntary movements of which my Council is only one) that I believe that, if we all go on trying, we shall eventually make some real progress.
5.4 p.m.
VISCOUNT HANWORTH: My Lords, I should like to deal with one aspect of consumer problems, which is providing information about the goods consumers buy. But I, like the noble Lord, Lord Donaldson of Kingsbridge, must declare an interest because I am a full time working member of the Consumer Council, and the head of the labelling branch which is responsible for TELTAG. The views I am going to express this evening are, of course, my own, and I thought rather carefully whether it would be right to speak, but I propose to deal with the subject in a fairly broad way. I gather the noble Baroness, Lady Burton of Coventry, is also interested in hearing something of what we are doing on the TELTAG side.
In England to-day the need to provide consumers with reliable information on the goods they buy is, I think, a very pressing one. The range of goods available has vastly increased and the old yardsticks on which they could be judged do not any longer apply. For example, wool garments can be treated so that their characteristics are quite different from what would normally be expected. Wool garments may have as good a resistance to shrinkage as other types of fibre. Moreover, things are changing so rapidly that there simply is not time to find these things out by trial and error. By the time we have done that, probably a new and improved product will have come on the market.
I think we must also take into account the immense power of modern advertisements. The new Trade Descriptions Act will improve the reliability of the statements made, always provided that there is adequate enforcement. I think we must remember that the weights and measures authorities have a very big job to do. They are doing it very well, but they cannot be everywhere and there is, of course, a danger sometimes that it may be worth while the manufacturer, or whoever it is, just pressing ahead and saying, "Well, one is unlikely to get caught out". So we have got to think of enforcement that is adequate for the purpose. It is interesting to note that in some areas the Trade Descriptions Act has been a positive disincentive to providing even the meagre amount of information which was given before the Act came into

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force. Later on I am going to say a word about the use of Section 8, which provides compulsory powers in the Trade Descriptions Act, because if we are going to continue to get the amount of accurate information we need I believe there are areas where enforcement must be considered and must be used.
I think there is also a much longer term aspect to this matter. The success of our capitalist economy relies on consumer choice dictating the type of product firms make, and without an informed consumer it is certain that the feed-back will not operate efficiently. There is certainly a danger that if the consumer has to reply solely on the statements made by the manufacturers, the initiative will rest largely with the manufacturers and their trade associations, and these necessarily tend, in the main, to have a rather conservative approach. This would not only be to the detriment of the consumer, but to our ability to compete in overseas markets. We must sec that new products which are an improvement come on to the market as quickly as possible in order to be able to compete overseas. If the consumers are not informed they probably do not know that such products exist, and therefore we do not move into new fields as quickly as we can and should.
Apart from the information which the manufacturer provides, there are three recognised systems for helping the consumer in making a logical choice. These are: comparative testing; quality marks; and informative labelling. Comparative testing, as your Lordships all know, is represented in England by the Consumers' Association magazine Which? This fulfils a very important and useful role, particularly so for the more highly educated consumer. It cannot, however, directly provide information at the point of sale either to the buyer or to the sales assistant, and in many cases it is the sales assistant on whom the consumers rely in trying to make their choice.
We then have quality marks, and these are intended to show that goods have reached a certain standard of performance, quality or safety. Unfortunately, the vast majority of so-called quality marks are very little more than trade "puffs", or an attempt to promote the sale of a particular product. They have
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no public requirements or system of surveillance. The certification trade marks, which have to meet requirements laid down by the Board of Trade, are notable exceptions to this generalisation. They include the kite mark, which certifies compliance with a British Standard; the B.E.A.B. mark for the safety of domestic electrical appliances; and the wool mark, which requires the product to be of pure wool and to meet certain specifications. There are, of course, many more, but I have mentioned three of the ones which are particularly well known.
These marks are of real help to the consumer where there can be a clearly defined basic specification, such as for health or safety, but they provide no guide for the bulk of goods which exceed the minimum requirements or where the consumer's choice depends on sorting out the various performance characteristics of the goods to meet their own particular needs. As an example, a food mixer might be excellent for whisking eggs but simply not man enough for the Victoria sponge cake. There, of course, one is faced with a dilemma when dealing with a quality mark: do you exclude the mixer which is suitable only for whisking eggs, or what do you do? The usual answer is that it would come down on the lower side, and would therefore give no information whatsoever on the properties of the mixer for cake-mixing.
Informative labelling is a fairly wide term, and it is often used to cover care instructions such as may be given on textiles for specifying the recommended washing or cleaning procedures. I prefer to confine it to information which may be given to assist consumers in making a logical choice at the time of purchase. The aim is to give a balanced overall picture of a product with an emphasis on its performance characteristics. I think carpets are probably a particularly good example. There are two major characteristics of importance to the consumer; one being the durability and the other being retention of appearance. By "retention of appearance", I include such things as colour fastness, pile flattening and soiling. If you are a family man with, say, three children and you want a carpet in your living room, and if you cannot go out and buy the most expensive type of carpet, durability must be your first consideration. If, on the other hand, you want it in the spare room,

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which is very seldom used, then the durability problem simply does not enter into the question and you are much more concerned with its retention of appearance, the fact that it will not fade. So it is not just a simple matter of giving a quality mark. You have to give more information, perhaps combined with a quality mark, to enable the consumer to make that logical choice.
This type of labelling was started in Sweden some 16 years ago, and it has been taken up in other Scandinavian countries. Schemes have also been recently started in Germany and Holland; and it is being considered in America, too. Our own TELTAG was started just four years ago and is based on the same principles, and I should like to tell your Lordships something about it in a little more detail. Producing a TELTAG is quite a long and complicated process. First of all, we have to find out as much as we can about the product and then produce a tentative label for discussion with consumer interests; because, above all, the TELTAG is designed to be a label for consumers, so our first preoccupation is what consumers want to know and how we can give them the information in an understandable form. I should like to say here that the Consumers' Association, with all their expertise, have been particularly helpful to us. They always attend our meetings when we discuss a label, and they provide any information which they may have on the methods of test, and so on. So this has been a very happy relationship with another of the consumer bodies.
We then discuss the revised label informally with the trade, and, depending on circumstances, either ask the British Standards Institution to arrange for one of their technical committees to produce a standard laying down the test methods we need or, alternatively, hold a meeting of interested parties and then put the test methods in the certification trade mark documents. So in either case they are published within the full meaning of the word. Before any manufacturer can join the scheme and use a TELTAG label the B.S.I., acting as our agents, inspect the quality control procedures at manufacturers' works and arrange for the testing of the product to check that the statements to be made on the label are correct.
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The standard of quality control is, broadly speaking, that of a good firm in that industry. We then have continuing visits, which are made roughly on an annual basis, and periodic tests of the product, some of which products we buy through retail outlets.
Although this degree of independent surveillance is no more than has been required for the B.S.I. kite mark for some time, it represents a new conception to many manufacturers who feel that outside influence in their affairs is undesirable and who tend to resent it. But we can usually convince them that in fact this is necessary to preserve the validity of our mark against abuse. We feel, however, that this independent surveillance, and the full publication of all test methods and regulations, are one of the most important parts of the scheme, both from the consumer point of view and in making the scheme of real value in our export markets.
Our own experience has shown that firms often believe that their quality control is excellent when in fact the system has broken down at the lower managerial level. Our largest retailer of carpets, who has well over 150 shops, will shortly be using the TELTAG for all his tufted carpet ranges, and has publicly stated that one of the chief reasons for doing so is that it will no longer be necessary for the firm to make their own tests and checks on the quality of the carpets which are being manufactured for them to sell. It is also interesting to find that the information given on performance, and in particular the colour fastness of carpets, has increased the interest in this important characteristic and has led to improvements which were at one time thought impossible.
Surveillance, however, is only one of the difficulties we have had in getting the scheme accepted by manufacturers, and perhaps it goes without saying that no manufacturer has the consumers' interest so much at heart that he will join the scheme unless it is thought to be a viable commercial proposition. We ourselves have never had any doubt that the scheme had worthwhile commercial advantages—always provided that the manufacturer will use it as a selling aid and not, at this stage, simply sit back and imagine that the label will automatically sell itself. This may of course be so in the

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future, when the scheme becomes far more widely known, but it is, I am quite convinced, a very powerful selling aid for those who use it. The scheme does not in fact cost very much. If you cost it on a product basis it usually works out at something less than 1,000th of the retail selling price of the product. So this is something which the manufacturer can absorb quite easily if he feels that the scheme is going to be useful to him.
Some manufacturers also view the scheme as a further interference by the Government and as something which will upset the existing status quo or interfere with the importance of brand image, or, at the best, as a needless complication to an already complicated life. Looking at the situation as it stands to-day, I think I can say that we have succeeded in establishing the TELTAG scheme, although it has taken a good deal longer than we had hoped for when we first started. But the speed at which we can expand it and make a real impact on the consumer depends on the funds that we can get for publicity. As your Lordships have heard, the maximum amount that we could spend last year was £20,000. That does not begin to reach the consumers at all. We have found this money to be very useful in getting the retailers and others to know something about the scheme; but it simply does not touch the problem of getting the scheme moving really quickly.
I believe, for reasons which I have stated earlier, that there are areas where the Government should make use of the compulsory powers given under Section 8 of the Trade Descriptions Act, not only to establish the principle of giving more information to the consumer but because in some cases an order covering a whole product field would be better than a partially-implemented voluntary scheme. Frankly, I am doubtful whether the Board of Trade, which is responsible for implementing such compulsory legislation, has yet organised itself to take such a task. which is a very considerable one when one takes into account the amount of consultation and research that is necessary before using compulsory powers.
We hope that we can press the Board of Trade to grasp this nettle, and, incidentally, to support them in the House
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when they nave grasped it and not to ask: "Why did they not do it on something else, something which would have been so much more important? "—because I think we can rest assured that where they do it they will have considered the matter extremely carefully. It is very important that they should get started on this in the right area, which may not necessarily be the one which appears from the outside to be the most important to the consumer.
Before closing I should like a word about consumer education. Many people think, and I agree, that a good deal of consumer dissatisfaction and complaint would disappear if people knew more about the goods and services they buy and if they adopted an altogether more questioning attitude to what is displayed before them. There are two ways to tackle this: to give consumers more and better information at the point of sale (as I think TELTAG will do), which makes it easier for them to find out what they can expect from goods and services; and also to encourage consumers to be more questioning and discriminating.
This means starting with basic education. I am impressed by the way in which consumer education is being taught in school subjects. Pupils are encouraged to make visits to shops, to evaluate the comparative merits of different products, to learn how to manage the money they earn and to master the intricacies of hire-purchase and credit documents. Groups of young people in colleges of further education and in clubs are by no means passive consumers of goods and services. They take a lively interest in their rights as shoppers and want to find out as much as they can about the things that they buy. One of the problems of consumer education is reaching out to people who may not choose to use any part of the formal education system—and the Consumer Council has explored a number of possibilities of reaching consumers with basic education. This includes talks with groups of mothers at post-natal clinics, with youth clubs, with community clubs. The impression that is left by all these encounters is that people do want more information about the goods and services they use but they do not always know how to go about getting it. And

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they are emphatic that they certainly do not get it from an overwhelming number of suppliers. I feel that in the future consumer education can be one of the most important ways of overcoming our consumer problems; and from what I know of the other work of the Consumer Council, I can say that we have done a great deal in this field and have done as much as our finances could permit.
5.25 p.m.
LORD REDMAYNE: My Lords, I too must congratulate the noble Baroness. I know that the retail trade will be keenly interested in what she had to say, and indeed in this whole debate. They will be grateful to her for her acknowledgment that there are some white sheep among the black—I am also, because I am a director of two large and quite separate retail organisations. In this debate, therefore, I feel something of a lone wolf in white sheep's clothing—which the noble Viscount, Lord Han-worth, will agree that I am entitled to call "double thickness".
No scrupulous retailer takes exception to the principal objects of the Trade Descriptions Act, but since it submits him to supervision of his trading he has a right to ask that that supervision should be intelligently applied; and I doubt if this has always been so. To quote a concrete case, I doubt whether a branch of a reputable multiple chemist should be taken to court because an assistant inadvertently charged a customer (who was an inspector) the full price for a product which was marked" 9d. off retail price". Admittedly, shopkeepers are responsible for the actions of their employees; but there are limits to the possibilities of supervision of individual mistakes.
I would say, for example, that if an inspector makes a test purchase he should act in the same way as any other customer. Any other customer making that purchase would obviously say: "What about the 9d. off?" The answer to that would immediately tell the inspector whether, in fact, the cause of the complaint was an isolated act of carelessness which could be adequately dealt with by a warning to the branch manager or to the company, or whether, on the other hand, it was a wilful act which justified prosecution. Incidentally, the company of which I am talking in this
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instance was fined £100 for what I regard as a very trifling offence. The damage is that a fine of that category gives to the public at large a grossly magnified image of the nature of the offence. Indeed, one could wish that the shoplifter was treated with the same severity as the shopkeeper. But that is perhaps hardly relevant to this debate.
My Lords, the second point relating to the particular multiple company to which I am referring is in regard to errors in dispensing. I should be grateful if the noble Baroness who is to reply would give me a specific answer on this point. The dispensing error that I have in mind at this moment was the cause of a recent prosecution based on a shortage of ten pills in a bottle—trifling enough as it sounds, although dispensing errors are very important. There is no doubt of that; they are serious matters. But I put it to the noble Baroness that these are very much better dealt with by complaint to the local National Health executive committee rather than under the Trade Descriptions Act. The National Health executive is much more competent to judge a professional matter; it has full powers to reprimand and to fine, and it can even strike off an offender. So far as I know, there has never been any suggestion that the supervision of dispensing chemists by this means has been inadequate.
One tends to suspect, my Lords, that some inspectors may regard a prosecution as a feather in their cap and be forgetful that, as I have said, to the company concerned it may mean serious damage to good will out of all proportion to the gravity of the offence. Of course, it is desirable to detect and punish unscrupulous traders, but the honest do not relish being treated as dishonest. Therefore I think it fair to ask again—this question has already been put—whether local authorities have received any advice from the Board of Trade as to the policy which local authority inspectors should follow in carrying out their duties under this Act: and, if they have, what were those instructions.
I do not want to be tedious, but there are two or three anomalies that arise under Section 11 which ought again to be put on record. The noble Bareness, Lady Burton of Coventry, referred to them as loopholes in the Act; I would

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refer to them as pitfalls for the honest shopkeeper—perhaps a difference in attitude of mind. They are causing a great deal of anxiety to those who have to manage retail businesses, and I would guess that they are just as puzzling to the inspector. Why, one might ask for example, is it apparently forbidden under Section 11 to sell an article marked, "3d. off the recommended price" at less than 3d. off the recommended price? It frequently happens that the retailers regular price is lower than the recommended price and therefore he is caught between two fires. The customer expects him to take 3d. off his regular price, but, as we read it, the Act forbids that, if in fact the offer is made in relation to the recommended price. It is a terrible tangle and I do not expect the noble Lady to reply to these points. As I say, they are for consideration.
Another anomaly is the provision that a product reduced from its normal price must have been on offer at that price for not less than 28 days in the preceding six months. We all know this provision. It has two effects; one is that that offer becomes illegal if it continues longer at the lower price than approximately the six months on which it is based: thereafter it must lapse. Alternatively, of course, under the same provision it is illegal to make a further reduction in the reduced price during the period of six months unless the lower price has itself ruled for 28 days. There are other anomalies. I will not go into them in detail, but honest traders do want guidance about how this Act should be interpreted. In fact, as the noble Baroness said, Section 11 badly needs amending.
There is one other effect of the Act which is worth putting on record. It is that at a time when maintained prices of any sort were being largely abandoned, for the presumed good of the consumer, there has become apparent a strong tendency for manufacturers to return to maintained prices, recommended prices, as being the least uncertain base for a pricing policy. As a result, consumers are having to pay marginally more than the market would necessarily demand. As I say, we want a solution to these difficulties and I was grateful for the generous support of the noble Lord, Lord Donaldson of Kingsbridge, who admitted, in a way in which it has not been
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admitted before in this debate, that there are two sides to this question; that the battle is not all on the side of the consumer; that the retailer has his problems too and is doing his best to resolve them in the public interest.
A further undesirable result of the Trade Descriptions Act as a whole is the false impression which it has created under its catch-phrase name of "the Shoppers' charter". It has been accepted by the public that the Act is not only a protection against misrepresentation but provides machinery for complaint, particularly in the office of the local inspector of weights and measures. Those who have any practical knowledge of this aspect of retailing will know that customers' complaints run the whole range, from genuine, through arguable, to frivolous and downright dishonest. The shopkeeper, of course, deals with them on their merits, and with an eye on retaining the continuing goodwill of his customer. But, if I may say so, the customer will frequently get more generous compensation—a matter referred to by the noble Baroness—from the shopkeeper, interested in retaining his goodwill than from any legal decision. I think that the use of the offices of inspectors of weights and measures for this general purpose is a waste of time and money, because two-thirds of these complaints cannot be resolved in that way. By the same token, I am not very happy about proposals for increasing the machinery of Citizens' Advice Bureaux; for the provision of legal aid more easily—certainly not in respect of individual complaints to the Consumers' Council, though I gather that that is not really a runner. Possibly the obtaining of legal advice is a different matter, provided that advice, when given, is informed on particular technical points. I do not think that it is just a matter of law; it is to a great extent a matter of retail practice. If this is to be the way in which those who fight the consumers' case want the scheme to be implemented, I am certain that all these agencies will be swamped by complaints to which the shopkeeper himself could give a sensible answer.
Whether the answer would be acceptable to the customer is another matter altogether, and that is what competition in the High Street is all about. It is too easy for people to think that shopkeeping is simply a matter of buying and selling.

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In fact, it concerns itself wholly, through the agency of buying and selling, with establishing and maintaining a permanent relationship with a body of customers. Supervisory legislation is for rogues anti fly-by-nights. The great mass of retailers stay in business by the goodwill of their customers and do not lightly risk damaging that goodwill.
My Lords, apart from my present interest I have been closely concerned with the retail trade all my working life. During forty years I have seen a very significant change in consumer attitudes—and this point was referred to by the noble Lord, Lord Donaldson of Kings-bridge. In the 1930s the consumer who could find the cash—admittedly. if he could, he was lucky—spent it with very considerable caution and I think with great wisdom. On the other hand, a large part of the public which desperately needed consumer goods and had little enough cash to spend fell victim to some pretty unscrupulous trading by some sections of the retail trade.
The 1940s looked after themselves, or at least the problems were different; but by the 1950s the pattern had changed considerably. Those who had some prosperity represented an increasingly wide section of the public, but among them there were many who had little experience of spending cash in the sort of quantities in which they then found it available. They were more free to spend, and frequently they spent badly. Too often they chose what was expensive or eyecatching rather than what was. in their judgment, good value for them. The expensive or eye-catching may well be good value, but it is not on that account a good buy for a particular type of customer.
During the ten years or so after the war some customers made great mistakes. One saw them constantly if one was in the retail trade. From the sum of their regrets there grew a body of opinion which sought to protect consumers from their own unwisdom, and this is really what this debate and the legislation that has preceded it has been all about. I do not quarrel with the legislation in principle, but I am glad that the noble Lord, Lord Donaldson of Kingsbridge, and the noble Viscount. Lord Hanworth, have stressed the need for consumer education. I would ask
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that consumer education should not be based on the idea that the retailer is the enemy of all men. Let us have a bit of co-operation. Certainly the two companies, of which I am a member, and which have already been doing this for some years, will continue, if we are required, to do our utmost to provide men who can talk about the merchandise which they sell. I believe that this is a useful service and one that the retail trade as a whole would certainly support.
We must ensure that the legislation. we have is working well, and I would ask that its working be studied with the idea of amending legislation where necessary. It must work well in detail, and in its overall effect on our society. I do not believe that excessive protection of the individual can in the long run do anything but harm. By all means let us pursue the rogue, and protect the unfortunate. But I hope that we shall treat the great majority of citizens as adults capable of conducting their own affairs, and the great majority of shopkeepers as honest men.
5.42 p.m.
LORD TAYLOR OF GRYFE: My Lords, I am glad that the House has an opportunity of discussing consumer affairs and, like other speakers this afternoon, I should like to acknowledge my debt to my noble friend Lady Burton of Coventry, not only for her comprehensive review of the problem but also for her continued interest and vigilance in these matters over a long number of years. I am sure that it is some encouragement to her to see her interest shared, and the progress of legislation in this field.
Like others who have spoken this afternoon, I have to declare my interest, which arises from my close association with the Co-operative Movement. A great deal has been said to-day about new organisations which are concerned with consumer protection, such as the Consumers' Association and the Consumer Council, and it may not be inappropriate to make some reference to the Co-operative Movement as a consumer-owned organisation, embracing no fewer than 13 million consumers, with an annual volume of trade of around £1,000 million. We are inclined

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to take the Co-operative Movement for granted. It has been in existence for a hundred years, and when we look at its history we appreciate that the original justification for co-operatives was that they were organisations of consumers bound together by a common philosophy to protect the consumer. Indeed, long before legislation for consumer protection was placed on the Statute Book, co-operatives were guaranteeing correct weights and campaigning against the adulteration of foodstuffs.
When so much is being said nowadays by various parties about the importance of participation and involvement of people in community enterprise, I expected that something might have been said about the contribution of co-operatives in this field. Co-operatives are organised and owned by consumers. They are administered by consumers through local committees, and in the field of consumer education, through its educational agencies and women's guilds, the Co-operative Movement has deep roots in the community and plays a considerable role in educating the housewife in quality, design and other aspects of the goods which she buys.
Having dealt with my particular area of interest, I should like to make some general comment, because I feel that in the comprehensive debate we have had, points of detail have been thoroughly pursued. Listening to my noble friend Lord Donaldson of Kingsbridge, I found that I could not share his optimism about the growing significance of the consumer explosion in our society. In fact, when I look at economic policies in Britain in the last decade I seem to detect a deterioration in the position of the consumer in society. We are all familiar, from our television screens, with the fact that when the Government are discussing new economic policies the T.U.C. are summoned to Downing Street, and we see with equal regularity that the Government call in the C.B.I. before any major economic policy is evolved. The T.U.C. represents largely the workers in manufacturing industries, and in turn the C.B.I. represents especially those in manufacturing industries, and in the evolution of economic policy I feel that at times the general consumer interest is neglected. Perhaps that is why some strange legis-
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lation, like the selective employment tax, finds its way on to the Statute Book.
I feel that the role of the consumer in Government is a declining one. Noble Lords who are familiar with the work of John Kenneth Galbraith will appreciate that his argument, the myth that the consumer is king, no longer holds. Because of the very nature of modern mass production and the investment that is called for in research and in plant in order to put new products on to the market, the consumer is conditioned to accept those products before they are launched. No manufacturer can now risk putting a product on to the market without a considerable barrage of advertising and brainwashing to ensure that the product is accepted. So the consumer is not the man who wanders down the High Street with a free choice without any previous conditioning. I suggest to my noble friend that his conception of the place of the consumer should not he framed so optimistically as he has expressed it this afternoon.
LORD DONALDSON OF KINGS-BRIDGE: My Lords, may I comment? I certainly did not use the word" explosion"; I deny that. Galbraith's remarks apply to the United States of America and are much truer there than they are here, but I absolutely accept that there is a danger. What I do not accept is that from the point of view of the consumer the situation is different. It has always been the case, and it is intensifying, but so are the numbers of consumers and so are the consumer organisations.
LORD TAYLOR OF GRYFE: My Lords, with regard to the more specific points raised by my noble friend Lady Burton of Coventry, I think there has been general acknowledgment that the Trade Descriptions Act is a consumer's charter. I hope that some of the difficulties of operating Section 11 will be examined. When that section was being framed, I think that many of the people who were engaged in negotiations with the Board of Trade recognised the difficulty of applying it. While we may change that section in the light of experience, at the same time it contains within it a very important element of consumer protection.

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There has been an acceptance, I think, not least from my noble friend Lord Donaldson, the Chairman of the Consumer Council, that the Council has certain weaknesses. Probably the greatest of these is the fact that it has not been able to establish itself, despite its efforts, as a co-ordinating body for all consumer interests. That, as has been pointed out, was the intention of the Molony Committee Report. And the fact that it does not have grass roots is perhaps another weakness in the Consumer Council; and that has been acknowledged by the Chairman in his Report.
I am not sure that this latter difficulty will be overcome by establishing regional offices. I think that the acceptance of greater responsibility by local authorities in this field offers a much more promising possibility. I accept that it is a helpful thing in our community that, almost spontaneously, local consumer groups have been formed; but I think we must be careful about this matter. In my own experience, I have found local consumer groups full of goodwill and enthusiasm, but sometimes less than fair in making judgments and assessments of the performance of local traders. Indeed, I think it can be said that there have been cases of misrepresentation by people who seemed to be more concerned with publicity than an objective judgment. Like the noble Lord, Lord Redmayne. I think we have to see this matter in all its aspects. It is not a battle of the consumers against the traders, of the good against evil. The traders themselves have considerable problems. The distributive trade is a trade which does not pay high wages. It is carrying the full burden of the selective employment tax, and consequently traders can become vulnerable through no fault of their own.
So far as the Consumers' Association is concerned, as has begin mentioned, its main weakness is the fact that it is drawn from the middle-classes and the more intellectual and affluent sections of our community, whereas in our society real consumer protection is required by people who are much less well cared for. Citizens' Advice Bureaux, despite all the goodwill, have been ineffective in their efforts. They have been largely concerned with collecting complaints, transmitting them to the traders and returning to the original complainant the explanations of the shopkeeper.
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As I have said, the most helpful development has been the recognition by several local authorities of their responsibility in these matters, by the establishment of local consumer departments. There they can draw on the expert knowledge of Weights and Measures inspectors, public health inspectors and so on. I understand that the Institute of Weights and Measures is now preparing a diploma on consumer affairs so that their inspectors may be much more competent to exercise a wider supervision. But if this job is to be done effectively by local authorities, we must get away from the old idea that the local authority man is some kind of snooper. We must try in our consumer legislation to effect liaison between the community and co-operative societies, chambers of commerce, citizens' advice bureaux, local consumer groups and so on, to see that this consumer protective legislation is discharged with goodwill and understanding.
I think that most speakers in discussing the work of the Consumer Council this afternoon have highlighted the weakness of the lack of co-ordination. But this is true of Government Departments also. There are several Government Departments interested in this area. The Ministry of Agriculture, Fisheries and Food, the Board of Trade, the Home Office, the Department of Health and Social Security and the Ministry of Technology, all have some responsibility in this field. We have to look for co-ordination in this field not only of the bodies mentioned—the Citizens' Advice Bureaux, the Consumer Council and so on—but also of Government Departments.
My noble friend Lady Burton asked what kind of body we wish to create that will effect co-ordination. The Co-operative Movement has led evidence on occasion that it might be appropriate to consider the establishment of a Ministry of Consumer Welfare. I have no intention of creating further bureaucracy or adding to the cost of Government administration. It may be that such a Ministry could be the Government body responsible for relations with the British Standards Institute, the Consumer Council, the Consumers' Association, the Retail Standards Association, the Council of Industrial Design and similar bodies whose work is important to the consumer

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But, in addition, it should assume responsibility for weights and measures and food and drugs legislation, and should administer the Trade Descriptions Act in liaison with local authorities. It should represent consumer interest in connection with applications for import duties on foodstuffs and other consumer goods and in connection with the application of indirect taxation, such as purchase tax and selective employment tax.
It should be consulted before Government policy is declared; it should be brought into consultation perhaps by Ministers when they are making their appointments to the various consumer councils in the nationalised industries. It should be prepared in the interests of consumers to make representations to the Monopolies Commission or to the Registrar of Restrictive Trading Agreements on any aspect of restraint of trade which appears to be operating against the public interest, and so on. That would appear to be the comprehensive remit which a Ministry of Consumer Welfare might discharge. And in the last analysis, it may not add to the burden of Government expenditure. It may be a method of rationalising and streamlining the many bodies and activities which are engaged in this field.
There is one other matter to which I should like to refer, and it is the problem of consumer representation in the nationalised industries. I think we all agree that nationalisation in itself does not guarantee that the industry concerned will be sensitive to the needs of consumers. A public monopoly, like a private monopoly, removes from the consumer his basic strength—his right to choose and his ability to take his custom elsewhere if he is not satisfied. I am not arguing against nationalisation. The Nationalisation Acts themselves recognised this difficulty. But, in looking at the operation of the consumer councils within these nationalised industries, I think we should from time to time take stock as to their effectiveness.
Co-operative organisations recently gathered together people who sit on these bodies nationally and tried to make some assessment of their effectiveness. They complained of a lack of independence. These committees are frequently provided with staff and premises by the Boards of the industries concerned, and tend to
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be part of the Board rather than an independent element. They have extremely limited powers. There is a lack of public awareness of the existence of these councils within the nationalised industry. A Gallup survey showed that only 12 per cent. of the public had heard of the electricity and gas committees, and only 4 per cent. of the transport consultative committees. So I feel we must examine this important element, too.
I am well aware that this is a very difficult problem, and while we are concerned about consumer interest being expressed adequately in public monopolies, at the same time we must do nothing that inhibits these industries, or frustrates these industries, from operating as first-class business organisations, because they will be judged in the future on that basis. I think we can make some assessment of the effectiveness of these councils without disturbing the commercial viability of these undertakings.
6.1 p.m.
LORD AUCKLAND: My Lords, I should like to join those who have congratulated the noble Baroness, Lady Burton, on enabling us to have this debate to-day. Those of us on both sides of the House who have sat through a number of consumer debates on Government Bills and other Motions over the years, will know what a stalwart champion of the consumer she has been and, indeed, at times she has hurled her barbs at this Bench and her own Bench.
The first thing we have to remember is that we are all consumers. There has been a tendency in the past to regard consumers as a very limited section of the public without realising that manufacturers, retailers, sales managers, merchandisers and market researchers are themselves consumers. Therefore, in this Motion we are really looking into the future, and trying to assess how to join together the existing legislation to make it effective. This is certainly not an easy job.
I should like to declare an interest of a non-financial nature, as a Vice-President of the Royal Society for the Prevention of Accidents. I believe safety has a great deal to do with this debate. The Royal Society, I know, will be interested to read what takes place to-day, and my own particular interest here is on the 1968 Medicines Act. I should like to ask the noble

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Baroness (I have given her notice of one or two points) a question concerning consumer representation on the Medicines Commission when it is set up. As I understand it, when the Bill went through the Government would not agree to actual representation of the consumer, or any consumer group, on the Commission as a whole, but they have given an undertaking that they would be represented on some of the committees.
I wonder whether the noble Baroness could expand on this matter tonight, or on another occasion, because it is very important at a time when drugs and pharmaceutical products are becoming such emotive words. It is essential that the interests of the pharmaceutical companies and the drug manufacturers, who for the most part are extremely honest, hard-working people, should be protected. The general public as a whole are becoming more safety conscious. I noticed this particularly last week when I went as a guest to the Safety Week in the Borough of Lambeth, where I saw some of the excellent work which is going on in educating people on the matter of safety, and particularly safety in consumer products.
This brings me to the subject of labelling, and one wonders whether sufficient is being done with regard to some of the pharmaceutical capsules and other products to make quite sure that young people particularly, and old people who may be affected in their vision, can tell these products from ordinary confectionery items. This is an important point. If accidents occur, they are highlighted, perhaps in an exaggerated manner, in the Press. Retailers and manufacturers inevitably find themselves, sometimes deservedly but this is often not so, on the butt end of an enormous row.
I should like now to turn to the matter of the consumer in general. We hear a great deal about cut-price items and offers. A good deal has been said in this debate. The Molony Committee made its recommendations, and we have had the Trade Descriptions Act. We still get a certain amount—particularly in cereals—of so-called free gifts, bulbs or some other product at a cut price. One wonders whether the general public really wants them. Has market research, whether carried out by the company or elsewhere,
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proved that they are wanted? What people want is the full weight and value of the corn flakes or the washing powder. Do they get it with these free gifts, or cut-price gifts enclosed with the products? I believe there is some doubt in the minds of many people whether this is the case.
There is also the fact that all this goes well beyond the retailer. The retailer depends very much on the know-how, and sometimes the honesty, of the sales force of the company concerned. I declare an interest here as an associate director of a small firm of management consultants. Some of my colleagues run communication courses for sales managers and sales forces of consumer products, although I am not directly concerned with that side of the business.
Much is being done now in the intensive training of sales forces. It is very important to a retailer that the sales representative, or, indeed, the merchandising representative who calls, knows his job. This is particularly true of the small retailer, who may have many customers to serve. He may have accounts to make up, and does not always have time to check on the bona fides of the man's knowledge, or ability of the person concerned. Much is being done now by training companies of the organisations concerned, as a whole, and of training companies generally, to make sure that their sales and marketing forces really know their products and do not merely put over the glossy nature of them; so that they do their utmost to give the beneficial aspects of the products as well, in order that the retailer can pass the information on to the customer.
Finally, I should like to say just one word about certain second-hand products which are still being hawked around the market. This is not primarily a debate on safety, but, as I said earlier, safety and consumer protection and consumers generally go very much hand in hand. There are still fêtes and sales offering too many second-hand electric fires, which are on the market despite the Act which I believe the noble Lord, Lord Amulree, piloted through this House some years ago. One sees them on market stalls and, as I have seen them, at fetes and elsewhere. One has only to have an accident caused by one of these appliances and the bona-fide manufacturers of electric fires

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may well find themselves branded as being purveyors of danger. I know that to some this may seem an extreme statement, but I have been told on very good authority that this is the case. My Lords, I hope that, as a result of this debate, the points which have been put forward, together with the various Acts which have resulted from consumer debates in the past, will be another milestone in a really good consumer representation for this country as a whole.
6.12 p.m.
LORD DRUMALBYN: My Lords, we are now coming towards the end of what has been an extraordinarily interesting debate, and I should like to echo what has already been said by way of gratitude to the noble Baroness, Lady Burton of Coventry, for not only having introduced the debate but having made such an excellent speech. I am not absolutely certain that I agreed with her final conclusion as to the value of a "summit meeting" on this particular subject, but she certainly set out the considerations in an exemplary manner for the House to consider. We have also had the benefit of a wide range of different points of view. We have heard both the previous and the present Chairman of the Consumer Council and had the benefit of their advice—and long may we have the benefit of their advice! I certainly would not subscribe to any suggestion that they should not be allowed to speak about consumer affairs in this House; we should be very much the poorer if they were debarred from doing so. Then, we have had a spokesman from the Co-operative movement taking part, and a spokesman (if I may put it that way) from the departmental stores, so we really have had a very wide range of assistance in this debate—
A NOBLE LORD: Multiple stores.
LORD DRUMALBYN: All right, multiple stores; I thought it was "departmental". I do not propose to go into any particular question, because it struck me that this was intended to be a debate about administration in general, developments in administration, rather than on methods of dealing with particular questions such as whether we should have a sixpence and a 50p piece—I wholly agree with my noble friend's views in that connection but I will not pursue them;
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whether free gifts are a good thing and, if not, who is to say that they are not a good thing (a question which I should have thought could be left to the market), and whether contracts should contain exclusion clauses. In this connection, I think we have here complete unanimity that the sooner legislation is introduced the better, and that we need not really wait until we have possibly the same kind of additional clause as Section 14 of the Trade Descriptions Act, which was experimental so far as services are concerned. I would doubt whether we should get further than an experimental clause on services in any Bill to amend the Sale of Goods Act.
I do not propose to say anything about "inertia selling" either, the supply of unsolicited goods, except that I think we must be very careful when we go in for legislation of this kind that we do not introduce side effects which would be just as bad as the disease. If the cure is going to be as bad as the disease, it is possibly a good idea not to have it. The point is that, if we were to follow the New York State legislation and allow a person to whom goods which he had not ordered were delivered to annex those goods—to treat them as a gift—I think we should be striking at our ideas of morality; and we should be very careful about doing that. We do not want to encourage people to acquire goods which do not belong to them in that way. I would certainly say in this matter that two blacks do not make a white and, furthermore, if we had this kind of proposal it might very easily do considerable harm to transactions by word of mouth. Everybody would want everything in writing, because otherwise the customer could always say, "I did not ask for this. I am keeping it. Thank you very much." So I think we must consider difficulties of this kind when we are thinking of legislation on such a subject as this.
Having said that, I think that possibly the best way of dealing with it is this. Mr. Bernard Levin has put forward a suggestion that information should be given with all goods as to the rights of the consumer; and this would follow the hire-purchase legislation. This, I think, would in itself probably be beneficial. We will wait and see what the Bill says, but I feel that I ought to make my

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position clear on this matter in advance because the simpler the law is made, and the simpler the obligations that are laid upon people, the better for all concerned.
I noted with interest what my noble friend Lord Redmayne said about fining. May I say this, in passing. My experience of the working of the Trade Descriptions Act so far is that on the whole traders are apt to treat a summons under the Act rather as they would treat a summons for causing obstruction in the road, and say to themselves, "Well, that is finished. I've had it. I may as well plead 'guilty', and the least said the soonest mended." I do not believe that this Act will work properly if traders take that view. If they think they are right, they must plead "not guilty", and appeal if necessary. The law is not all that clear—we know that—and there are aspects of it which need to be clarified, and they will not be clarified unless people stand up for themselves and their rights, if they think they are right.
I agree very much with the spirit of this debate in the sense that it seems to me that we are all united in seeing the value of the closest co-operation and coordination all along the line. If one looks back seven years or ten years, one can say that the antagonisms between the consumer and the trader were very much greater then than they are now. A great deal of the credit for this change lies with the various bodies which have been working in the field. But, so long as consumers treat themselves only as consumers and traders treat themselves only as traders, we cannot expect to have a good relationship between the two.
The Consumer Council have done a good job, if I may say so, in bringing parties together. Sometimes I feel they could develop this work even further than they do already. For example, supposing they were to publish in their organ Focus the results of working parties designed to set up codes of practice for trades and to make suggestions for legislation and the like (as they do to some extent), if they were working parties representing all the interests rather then merely internal working parties, it might be valuable. I always read Focus with the greatest of interest and a good deal of enjoyment, but many of the articles are really just reporting jobs that could be
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done as well by the Press. If Focus were to concentrate more on the general principle of getting both voluntary organisations and traders together for the benefit of the consumer—and indeed for the benefit of the trader, because the trader depends on the consumers—this might bring still more laurels to the Consumer Council, to the general benefit of us all.
I was tremendously interested in the remarks made by the noble Baroness, Lady Burton. She dealt mainly with four principal matters: the handling of consumer civil claims; the handling of other consumer complaints; the relationships between the various organisations concerned (which I have already tried to touch on), and consumer education and all that goes with it, including the training of shop assistants which I was glad to hear my noble friend Lord Redmayne mention.
I would approach this by saying that there are essentially seven bodies dealing with consumer problems. In the first place, there are laws, almost all of which have been touched on in this debate, such as the Consumer Protection Act and the Medicines Act, designed to protect the consumer against dangers to health and safety which particular goods may involve. Secondly, there are laws designed to protect him from misleading descriptions and claims, such as the Trade Descriptions Act and parts of the Food and Drugs Act. Then there are laws designed to enable him to assert his own rights and obtain redress under the civil law. Then there are bodies and associations concerned with helping the consumer with advice and information or making representations on his behalf. There are those which actually take up cases, including newspapers and magazines, which invite readers to send in their complaints for examination. They have columns, such as the Daily Express "Action Line". There is also consumer education. Finally—I think I am echoing what my noble friend Lord Redmayne has said—there is the individual and collective conscience of traders, coupled with their recognition that they are not merely making a livelihood but giving a service, and coupled, as my noble friend so rightly said—or perhaps it would be better to say "tripled"—with their recognition that they are wholly dependent on the good will of the consumers.

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My Lords, as taxpayers we all have a common interest in ensuring that we do not unnecessarily multiply the number of people in agencies looking after our interests as consumers, and probably doing things that we could and should do for ourselves. We also have a common interest as citizens in seeing that we do not strangle our liberty with a lot of unnecessary laws and regulations, and that we are in a position to know exactly what obligations such rules and regulations as do exist lay upon us, and what rights they confer upon us, whether as consumers or traders. Of course, we must have some laws and regulations to stop the rogues. At this point I would suggest that there is a strong case for grouping all enforcement duties for which we look to local authorities under one local authority department, and I would hope that when we get a new Local Government Act this will be a requirement in that Act. I am sure that it would make for better administration once we get a clearer division of frontiers.
My Lords, it is nearly a year since the Trade Descriptions Act came into operation and it is right that we should take stock of the position. As was to be expected, in the light of the way weights and measures inspectors performed their duties under the Weights and Measures Act 1953, for the most part these officers have sought to educate traders in the requirements of the Act, only bringing prosecutions in cases where a trader deliberately sets out to deceive or is negligent in the duty to avoid deception. I would admit to my noble friend that perhaps where they particularly dislike a practice, as they dislike the "threepence off" practice, they may bring prosecutions.
LORD REDMAYNE: My Lords, I hope my noble friend will study carefully to-morrow what he has said, which if I were not his friend I would call grossly offensive to the cases which I have put.
LORD DRUMALBYN: My Lords, is the noble Lord referring to what I have just said?
LORD REDMAYNE: Yes, my Lords.
LORD DRUMALBYN: I am sorry, my Lords. Most certainly I will look at it carefully to-morrow. I hope that I have
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not been in any way offensive; I did not mean to be. If my noble friend is talking about what I have just said about the "threepence off" technique—
LORD REDMAYNE: My Lords, I was talking about gross negligence.
LORD DRUMALBYN: My Lords, I think this is what the weights and measures inspectors have been trying to do—only to bring prosecutions in cases where there was either wilful deception or gross negligence. That is what they have been trying to do as a whole, but I have made an admission to my noble friend that where there are points on which they are particularly keen they may follow these up.
Weights and measures inspectors are rightly regarded as the allies both of consumers and of honest traders, and I know that they attach great value to being regarded in this dual capacity. No doubt there are cases where they have felt it necessary to make a public example to clarify the law for the benefit of the public at large, but I am told that the total number of prosecutions notified to the Board of Trade has now passed the thousand mark. I do not know whether the noble Baroness can confirm that. That may sound a large number, but spread over some 250 weights and measures authorities it represents only an average of four cases per authority per year; so it indicates at any rate forbearance on the part of the weights and measures authorities if there were a larger number of cases that they feel they could have prosecuted.
On the other hand, weights and measures inspectors have received a great many complaints from consumers. I am told that the total may be as many as 20 or 30 times the number of prosecutions notified. In view of the publicity given to the Trade Descriptions Act I think it was inevitable that a great many consumers should bring their complaints to the weights and measures authorities. No doubt many of them thought it was the duty of the local authority to obtain redress for them. I dare say that a large proportion of the complaints revealed no offence under the Trade Descriptions Act, or any other Act, but might nevertheless have appeared to inspectors to have some merit. Then, of course, the inspectors have to decide what to do with complaints

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which involve no breach of the criminal law. Ought they in such cases to spend their time, and the ratepayers' money, in seeking redress for the complainants at a time when many weights and measures departments are understaffed? This is a problem they have to face.
As your Lordships will know, some local authorities had been experimenting with consumer advisory and information services even before the Act came into being. Some had separated, partially or completely, their consumer services from their enforcement duties; and in my personal view they were wise to do so. Consumer help and advice services can usefully be attached, for example, to a public relations department of a local authority. I say this for more than one reason. If a trader is approached by a local authority, he has a right to know whether or not the local authority is acting in the exercise of its statutory powers. If the local authority officer is merely using his good offices in a matter where no offence has been committed, he should make this absolutely clear; and I believe that in such cases enforcement officers generally do so. Nevertheless, I feel that it is better if an enforcement officer turns over a complaint involving no offence to a different department, such as a consumer help and advice department. No enforcement authority can be right all the time about the law; nor, for that matter, can the magistrates in courts. This again is a good reason why anyone who considers that the enforcement authority or magistrates' court is wrong about his case should be prepared to take it to a higher court if he is found guilty of an offence in the court of first instance.
This liability to error is also a reason why enforcement authorities should not use their weights and measures status as enforcement authorities to induce anyone to do things that the person has no legal duty to do. I regard this as an important matter of principle. Enforcement authorities are efficient; they are conscientious; they are impartial. But it seems to me wrong in principle that they should act in matters where they have no powers, because it seems to me this can only lead to confusion on the part of the public as to the limit of their duties and as to what the law really is. If a complaint comes from a person who has suffered no loss and there is no offence, the inspector can
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report to the Board of Trade, if he thinks that the law should be strengthened, and the Board of Trade can call for reports on particular points from time to time. If a person has had a loss, he or she should be advised to obtain redress in the appropriate way.
If the weights and measures authority is not to help a consumer in this kind of way, who is to do it? A good deal of discussion to-day has ranged over this point. It has to be remembered that it is reckoned to cost something between £2 and £4 or £5 to handle each consumer complaint. If a test were required, it could be very much more than that; and then who is to pay? The noble Lord, Lord Donaldson, said that he did not know the answer to this, and nor do I.
BARONESS PHILLIPS: And neither do I.
LORD DRUMALBYN: I do not think one would have expected a definite decision, but surely part of the purpose of this debate is to examine the possibilities, and I would like to put forward one or two here.
There is one point that is important: whoever is going to settle the dispute should be either a person or an organisation which does not represent either traders or consumers; it must be an impartial person or organisation. I think that is the first point that must be established. So that Citizens' Advice Bureaux and the consumer information departments of local authorities are there to give advice and not to act as referees. The weights and measures authorities are impartial but they are enforcement authorities, as the noble Baroness, Lady Burton, has said. They are not conciliation boards or arbitrators. I would egree with the noble Lord, Lord Donaldson, that separate consumer advisory committees can help, but they are not necessarily the complete answer. I have considerable sympathy with the idea that there should be some form of tribunal or arbitration, perhaps in a small claims court, similar to the one in New York State about which the noble and learned Lord the Lord Chancellor was speaking, or by recourse to an arbiter; and I would suggest that such arbiters could be drawn from a panel of arbiters appointed by the local authority and agreed between the parties.
If I may say so, the noble and learned Lord the Lord Chancellor had a rather

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quick sleight of hand at this point, because he pointed out that in New York the arbiters to whom cases are referred act voluntarily, without cost; and he then went on to say that in his experience arbitration was always just as expensive as litigation. Could not we do the same here? Could we not have voluntary arbiters, meeting in the evenings as they do in New York, to whom disputed claims could be submitted? I think the noble Baroness, Lady Burton, suggested that this should be done by trial and error. Why should not we try it in certain areas, to see how it works, and then in due course reach final conclusions?
There is another consideration. It is unreasonable for a consumer to expect to get redress entirely at public expense unless he is without means, and if the legal aid system were extended to this sort of case it would be an ideal solution. I should have thought that the noble and learned Lord the Lord Chancellor was perhaps overestimating the difficulty of extending legal aid to cases of this kind. Given that it is so difficult to provide any other solution, I should have thought we were bound to extend legal aid to cases of this sort. He himself demonstrated the difficulty of finding any other solution, and he said that this really depends on legal aid—that is what his speech amounted to. Surely, if that is so, that is the solution that must be decided upon: legal aid must be made available in these cases, so that those who can afford to get redress will pay for it and those who cannot will get it just the same.
I do not want to detain your Lordships any further on those aspects, but I want to say a word about consumer education, because I regard it as extremely important; indeed, in this debate great stress has been laid upon it. I fully agree with what has been said, that this education should start in the schools. I would suggest to the noble Baroness that, at a time when we are about to have an extension of the school-leaving age, this is just the kind of instruction that could interest children staying on from 15 to 16. The great problem is to give them in the last year things that interest them and that actually affect what they are going to do in later life. I should have thought this was a
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very good opportunity to introduce consumer education in the schools; and that means also in the teacher-training colleges. I do not know how far the Consumer Council can assist in this respect. I know that they do a great deal by way of pamphlets and so forth; but if they could be peripatetic and provide this instruction in the teacher-training colleges, I think they would be doing a very great service indeed.
I would add one comment on what seems to me to mark a very great difference between our debate on consumer services this time and last time—and here I speak with an interest. I have not heard the word "advertising" mentioned once in this debate, and as Chairman of the Advertising Standards Authority I am very glad.
Lastly, there is one suggestion that I would make to the noble Baroness who is to reply, and that is that she might find it advisable—or, rather, the President of the Board of Trade might find it desirable—to have an advisory committee. I am sure that an advisory committee of this kind would have to be nominated by the President himself from all kinds of personal advisers. They should certainly not be delegates and should certainly not give their advice in public. Considering that the President of the Board of Trade has these duties of deciding what regulations to make, and considering also that he will be getting reports from the Institute of Weights and Measures Administration and the weights and measures authorities in general on various aspects of their work, and suggesting whether the law ought to be tightened up, it seems to me that a committee of this kind might be very valuable to him. However, I fully realise that that is really a matter for the President, and I would not press him to appoint a committee if he is not going to use it or did not think that it would be valuable.
I mentioned just now the weights and measures authorities. I omitted to say something which I feel I must say here The people who are as well placed as any to give the Board of Trade advice in matters of regulations to be made and so on, are the weights and measures inspectors, and the best way of giving such advice would be through their professional organisation, the Institute of

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Weights and Measures Administration. Noble Lords may be surprised to know that the Institute has no paid staff at all, although among other things it is responsible for the training of weights and measures inspectors. The Institute is financed entirely by the voluntary subscriptions of its members, and the subscriptions have been more than doubled in this year.
As this Institute is engaged in work on behalf of the public far more than in promoting the interests of its members—it is not a trade association—surely there is a strong argument in favour of giving an annual grant in aid to the Institute. It is important that the Institute should be able, with one authoritative voice, to speak collectively to the Government, to trade associations and to consumer organisations. It is already speaking to trade associations on travel matters, on the motor trade and so forth. It is also doing good work towards overcoming what, as the noble Baroness knows, I regard as the main difficulty of the Trade Descriptions Act, the fact that there can be almost as many interpretations of the Act as there are enforcement authorities, and there is no real co-ordinating body. The Institute is doing this by acting as a centre of information about cases pending and prosecutions decided, but it is greatly handicapped by lack of resources and by lack of people to deal quickly with problems. For example, not all enforcement officers are even members of the Institute. I understand that office bearers have to pay out of their own pockets a lot of the expenses incurred in the performance of their duties as office bearers. That is not a satisfactory situation, and I am sure that there is a real need to build up the prestige and effectiveness of the Institute as the professional organisation of enforcement officers in the field of fair trading under the law, because that is what this whole debate is about: to get the best possible means of fair trading and of administering the system of fair trading in this country.
6.43 p.m.
BARONESS PHILLIPS: My Lords, it is nearly a year since the Trade Descriptions Act came into force and, with her unfailing sense of timing, the noble Baroness, Lady Burton, has enabled us to look at the way in which the Act is working. She introduced the whole sub-
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ject in a remarkably clear and logical way which was a delight to us all. I think that the way in which the noble Baroness introduced the debate has set the pattern, so that in fact we have closely followed the subject under discussion and have not strayed into further fields. I will endeavour to answer the points that she has raised. Probably she will not like all my replies, and if they do not follow in strict sequence she will know that I am at any rate attempting to come to them. It is unfortunate, in one sense, that we are a little ahead, as we are so often in this House, of a Press conference to discuss the working of the Trade Descriptions Act. I have been given various statements which I could have made had we had the debate a week later; but as the honourable lady in another place who will be conducting the Press conference is a relative of mine, I feel that it would be a little hard if I stole her thunder to-day.
I should like at once to assure the noble Lord, Lord Mowbray and Stourton, whom I congratulate on his most interesting speech, that, unlike him, I am no maiden in consumer affairs. In fact, using one of the phrases that other noble Lords have used, I might say that I am a grass roots housewife of many years standing, because as many noble Lords will know, this has been one of my interests since long before I came into this House.
The Act came effectively into force eleven months ago, and so we have had an opportunity at looking at the number of cases that have arisen. It might be interesting to noble Lords if I outlined the figures given by the professional body to which such great tribute has rightly been paid by the noble Lord, Lord Drumalbyn, the Institute of Weights and Measures Administration. Several other figures have been bandied about, but I think their figures will be the most useful of all. The number of complaints relates to the nine months from December 1, 1968, to August 31, 1969, so they do not cover precisely the period of operation of the Act, but they are near enough. In that time 25,000 complaints were filed under the Trade Descriptions Act, and, as the noble Lord has just pointed out, about 1,000 prosecutions are being dealt with. I have to put it as generally as that, because various things can happen.

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It is important to recognise that the Institute has itself made the point that these figures derive from complaints raised by members of the public and do not reveal the number of checks made by weights and measures officers during their normal and everyday working. I think this is most relevant to the fact that we are talking specifically of the Act and the effect on the consumer.
I would at once agree with those noble Lords who have said that the publicity has undoubtedly aroused interest among consumers, which may result in some complaints which are largely frivolous. But, as all noble Lords who have been concerned in any work of this kind will agree, it is equally true that this will shake down as time goes on. The provision concerning false statements about services, accommodation and facilities has also been invoked, as well as the particular provision which we all expected would come greatly to the fore. The types of cases concerned are such as one might have expected—cars, motor vehicles and accessories coming well to the fore, with the setting back of mileage recorders and so on. But I think noble Lords will agree that the figures that I have just given, both of complaints and of pending prosecutions, leave no doubt that the Act has been vigorously enforced and that its passage was amply justified.
Of course, we must not get the wrong impression. There is no widespread and systematic attempt to deceive the customer. In relation to the total number of retail transactions that take place the number of prosecutions is quite small, and in a number of cases it is fair to say that the offences arose because the shop did not observe the high standard of care which the Act rightly demands in checking the accuracy of descriptions, rather than because of deliberate misrepresentation. I think that the noble Baroness, Lady Burton, would be the first to agree with me that the true success of the Act is to be measured not in a number of prosecutions but by the extent to which it promotes greater standards of care to get right trade descriptions; and there is no doubt about its success in that respect.
The Board of Trade are well aware of the immense amount of trouble that is
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being taken by trade associations and by individual companies at all levels to ensure that the requirements of the Act are fully understood and faithfully observed; and I think we must pay tribute, as many noble Lords have done and I should like officially to do, to the enforcement officers, to the weights and measures inspectors who are, as has been rightly said, carrying a heavy burden at this time. A great deal has been said on the fact that some guidance should be given to them. I am happy to say that I have here some guidance which was issued to local weights and measures authorities before the Trade Descriptions Act came into force. Your Lordships will be happy to know that I do not intend at this point of time to read through the whole of these notes. I should like to draw the attention of those of your Lordships who took part in the debate to one or two of the headings. On the question of duplicated offences which was raised during the discussion of the Act—whether a shopkeeper, or a multiple shopkeeper, could be prosecuted a hundred times, as it were, for the same offence—there is a very wise and full instruction to the enforcement officer as to his methods of conduct. These officers are of course requested to complete returns and to send them back to the Board of Trade in order to facilitate preparation of the statistics with which we have been dealing. I think this probably highlights the point which the noble Lord, Lord Drumalbyn, has just made.
I must say that when I spoke to the Institute of Weights and Measures Administration I, like the noble Lord, was amazed to know that their own Association was a voluntary one, considering the tremendous amount of work they did. While I cannot comment on this fact, I take the noble Lord's point that this is for the information, and we hope the consideration, of the President, and I would certainly say that I would endorse all he has said about the fact that a voluntary group of this kind does this remarkable piece of work.
This circular outlines very fully the lines of conduct for the weights and measures authorities. I think your Lordships would agree, however—and this is a point which we have often debated in this House—that too much direction from the central Government may lead to

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an apparent snarling up, as it were, of law-making and law-enforcing at local level. I am thinking now as a magistrate. I have so often heard in this House a request for a direction. But, of course, the courts are made up of people who are there to look objectively at the facts presented, and I feel that if the directives were too precise we might introduce a completely new principle into English law.
LORD REDMAYNE: My Lords, may I interrupt the noble Baroness? One would imagine that it is not a public document, and one can see objections to making it public. However, would it be possible to lay it in the Library of the House, or something of the sort, so that one might study it? It would be very helpful to those of us interested in the subject to see on what lines the Act is being implemented.
BARONESS PHILLIPS: My Lords, I will look into this point. I do not think there would be any difficulty, because the document concerns general lines of conduct. I will consult the Department and see precisely what can be done about this. As I say, I should not think there would be any difficulty about allowing those who are directly interested and concerned in this matter a sight of this document.
The noble Lord, Lord Redmayne, said that he did not want a specific reply this evening, but I can at any rate, speaking generally, give him some replies to the comments he made. He criticised the prosecution of a chemist because an inspector was overcharged on a single purchase. I think it is important to remember that, although local weights and measures authorities may enforce the Act by examination of goods and prices in shops, purchases are often made because complaints have already been made by the public. I call to mind an instance that was given to me at a meeting not long ago. It concerned an incident where a wrong price was shown in a supermarket. The member of the public went back at intervals, and this particular thing was still happening; and only then, did he make a complaint. So one accepts that the innocent may well be caught occasionally—or, rather, where the complaint is genuine. But it is important to recall
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that the officer often acts following a complaint made by the public.
The noble Lord, Lord Redmayne, referred to dispensing shortages. The Board of Trade have reminded local weights and measures authorities of the desirability of using the appropriate legislation for dealing with offences. But ultimately it must be left to the discretion of the authority concerned to decide how they deal with any matter that is brought to their attention. That is the point I have tried to make before. The Act places the duty of enforcement on the local weights and measures authorities, and the Board of Trade have no powers to require that they enforce the Act in any particular way. I think I must emphasise this. There would of course be difficulties about suggesting that a warning was appropriate in one case, but that there would have to be a prosecution in another. Much must depend on the circumstances of the particular case; and the local weights and measures authorities are on the spot and in the best place to judge what is likely to be misinterpreted by the local community and be most harmful to them.
I think it was Mr. Roger Diplock who suggested that there was a great deal of flexing of muscles. Weights and measures inspectors are human beings, and there will naturally be some who are perhaps more enthusiastic than others. But, equally, since we have agreed this evening that they are a grossly overworked group in the community, it seems unlikely that they would be seeking out something willy-nilly, and that they would prefer to take the course of warning rather than that of prosecuting. Indeed, I think the figures I have quoted reveal this.
The noble Lord, Lord Mowbray and Stourton, mentioned the recruiting of the weights and measures inspectors. I cannot give him any figures on this point. We have heard, of course, that they have their own courses. I do not know that this matter of numbers is very much under discussion because, as I have said, they are under great stress. I am sorry that I cannot give him any satisfaction at all about retaining the sixpence. I think that probably the noble Lord did not expect it. Nor, of course, can I give him, or the noble Lord, Lord Airedale, any hope about the 50p piece, except to repeat the points made so well by my noble friend the Chief Whip, that a coin

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has a much longer life than a note. It may be of some satisfaction to both noble Lords to know that I myself last week actually gave one of these as a tip, thinking that I was giving two shillings—so that may well be "the biter bit". However, there is little doubt that already people are beginning to get used to the new coin: one notices that in the stores they are putting these coins in separate slots. So, while I have no doubt that the noble Lords will probably return to the attack, I cannot this evening say any more on this subject.
The noble Baroness, Lady Burton of Coventry, and the noble Lords, Lord Mowbray and Stourton and Lord Airedale, referred to the Sale of Goods Act, and to the fact that the Law Commission have published this Report. The noble Lord, Lord Airedale, very skilfully suggested what my reply might be, thus putting me in the position that I must see to it that I give another reply. I can only say that the noble Lord, Lord Airedale, will appreciate that one cannot plunge lightly into legislation of this kind because it is hedged around with all kinds of complications, despite the justice of the case which has been argued. But I can equally tell the noble Lord that this matter is—I am not quite sure what is the phrase here; but perhaps I may say in the usual channels. I did ask if 1 could say more but I cannot do so because no date or anything has been arranged. At least he will see that the Law Commission's Report is being acted on without waiting necessarily on the other points—though these are very valid and, of course, the subject of further Reports. I hope that I have not, by saying that, in any way jeopardised my own position; and if I am reshuffled tomorrow the noble Lord, Lord Airedale, will have this on his conscience.
The noble Baroness, Lady Elliot of Harwood, we are always delighted to hear from, and I should like to pay my tribute to her work for the Consumer Council. I remember having the pleasure of speaking on a platform with her at one of these large meetings she mentioned, and I thought she put up a very spirited defence for the Consumer Council. if they want a public relations officer, I think they need seek no further than the noble Baroness herself. I agree with
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the noble Baroness that the case for what they are doing is a very strong one. Their proposals, as the noble Baroness will know, are currently under review, and the noble Lord, Lord Donaldson of Kings-bridge, is discussing this. I cannot from the Box this evening make any comment on the situation vis-à-vis more money for any of the proposals that are being put up. It seems that, however we dress up our requests in this House, whether they come in an intellectual guise or whether they come in the guise of defence, they always come back to what the Yorkshire-man calls the "come-from".
I sit here waiting for, "Can we have more money?" Whatever the subject, this is always what I might call the tag line. I would only say to the noble Lord, Lord Donaldson of Kingsbridge, and to the noble Baroness, Lady Elliot of Harwood, that Molony did not see any need for the Council to have regional organisations, because they conceived the Council as a central authority working at a national level; and the Committee reached the conclusion that the C.A.B. was the best agency to provide local advisory services for consumers. I am not saying this in any other way than in the spirit of reminding the noble Baroness and the noble Lord of what Molony said at that particular time.
The noble Viscount, Lord Hanworth, mentioned the question of TELTAG, and gave us a very interesting account of it. I hope he gave my noble friend Lady Burton of Coventry the figures for which she asked, because I do not have them. I do not think he gave a complete breakdown, but at least he gave an outline of how this scheme was working. I think this links very closely with the point which my noble friend Lady Burton put to me about seals of approval. Although the Molony Committee came to the conclusion that seals of approval should be controlled in some way, they mentioned that they found little evidence that consumers had substantial cause for complaint about their use.
I am sure the noble Baroness will agree that the Trade Descriptions Act has gone a long way towards outlawing seals which are misleading. It seems that the voluntary marks—the kite mark, the British Electrical Approvals Board mark and the TELTAG mark—are gaining ground against the type of seals which Molony criticised.

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I remember sitting on a number of voluntary bodies trying to determine how to describe something like "showerproof" or "rainproof". So much so that I have never since bought a coat which has been able to compete against the rain, because nobody seemed to be able to define what was showerproof and what was rainproof. These committees went on endlessly, and as one question was solved so another seemed to be turned up. So I would say that the fact that the TELTAG label has gone so far is a great tribute to the work which must have been put into it—and here I speak from some knowledge and background.
The noble Viscount, Lord Hanworth, asked us to grasp the nettle (I think that was his phrase) and to deal with Section 8, the marking order section. I think it is very important to remind the noble Viscount that it was made clear during the passage of this Act—in fact, there were expressions of anxiety, as I recall, from among your Lordships—that the Government never intended to make prolific use of these powers. It is very important to get this on the record. They are essentially reserve powers to be used to secure necessary ends when other possible means are found to be inadequate; and at present this is not the case. In fact, the noble Viscount's own marking scheme seems to be meeting a certain point, so far as information is concerned.
VISCOUNT HANWORTH: My Lords, perhaps I might just say that there are certain areas where voluntary means have not proved successful.
BARONESS PHILLIPS: Yes, my Lords; and the Board of Trade constantly have this under review. But I think it is important to emphasise that this is a final and rather absolute power which was, of course, questioned during the passage of the Act, so it must be looked at very carefully each time.
My noble friend Lady Burton, and I think my noble friend Lord Taylor of Gryfe, referred to the possible setting up of more co-ordinating machinery, or something which would be essentially different from that which exists at the present moment. To deal first of all with the point made by my noble friend Lady Burton, she referred to the functions of the Federal Trade Commission
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in the United States, and she wondered whether in any way an organisation of this character might in fact help the administration of consumer affairs in this country. I think it is rather important to point out that when we look at the functions of the Federal Trade Committee we see that we really cover a large number of them by legislation already on the Statute Book.
BARONESS BURTON OF COVENTRY: My Lords, may I interrupt my noble friend? The point was—and I hoped the noble and learned Lord the Lord Chancellor would rise, but he did not—whether it would be possible to include a consumer protection department in the justice department, as in America.
BARONESS PHILLIPS: In that case, I am afraid I shall have to rest on the reply of the noble and learned Lord. The point made by my noble friend Lord Taylor of Gryfe dealt with a different issue, though similar in one sense. He thought there was need for bringing in the consultative committees of the nationalised industries, and so on. I would certainly go along with him in suggesting that these very worthy councils should be better known. Anything which seeks to help the consumer should certainly be better known. But so far as a wider co-ordinating department is concerned, I must refer him to the reply of my right honourable friend the Prime Minister when this question was put to him in the other place recently. He said:
"I think that consumers' interests are best served by the present arrangements, under which the Board of Trade has a general responsibility for consumer protection but the Ministry of Agriculture, Fisheries and Food, with its expert knowledge, has a special responsibility in relation to food".—[OFFICIAL REPORT, Commons, 26/6/69, col. 302.]
This is not, of course, a final reply by any means, but it is the reply at this point of time.
The noble Lord, Lord Donaldson of Kingsbridge gave us a very interesting history, I thought, of what led up to a great deal of consumer legislation, but I should like to point out to him and to the noble Lord, Lord Redmayne, and, I believe, to several other noble Lords, that here I feel I must speak up for the Citizens' Advice Bureaux. They appear to have nobody among your Lordships represented on their committees, so their

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voice has not really been heard. When not in Government, I had a very close affiliation with them; so to the noble Lord, Lord Redmayne, I would say that the Citizens' Advice Bureaux have a policy, when a complainant comes in, of always referring them first to the shopkeeper before they in fact take the complaint any further. And, of course, they had 85,000 consumer inquiries in 1968–69 compared with 59,000 in 1963; so there is little doubt that they are not wholly concerned with social service matters. I would remind your Lordships that the bureaux were set up during the war, when they certainly would not have been dealing with social services. They were dealing with practical questions and answers which related to points of law. So there is little doubt that they carry out the functions of dealing with consumer inquiries.
The noble Lord, Lord Auckland, made a point about the Medicines Act and the Committee on Advertising and Labelling. At present, the composition of the Committee has not been dealt with. I am sure that my right honourable friend will bear the noble Lord's point in mind when this is looked at, but the composition of this Committee is not immediately under discussion. Of course, we salute the noble Lord, Lord Auckland, for his work for safety; I know of this in another way. I take his point about the danger in connection with second-hand electric fires. There are, of course, various regulations, as he will well know, already on the Statute Book, and the Home Office, which is responsible for this section, is constantly looking at this. This is one subject, I see, which they have marked for further discussion.
My Lords, I hope I have attempted to reply to most of the questions raised. This has been a very interesting debate—I would say a fascinating debate—and each noble Lord who has participated has emphasised the point on which I think we would all agree: that only the educated and the informed shopper can in fact, in the end, get best value for money. I am sorry, I nearly missed Lord Drumalbyn's point about consumer education. The Consumer Council in this field have a very good record, starting, as the noble Lord emphasised, with the schools and building up. I rather took the other points that the noble Lord,
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Lord Drumalbyn, made as points which he hopes my noble friend will look at; because I am sure that he would not expect me to make a formal reply. I can only say that I rather liked some of the suggestions he put forward; although I found that at one stage when he was putting the questions I had not the answers, and it seemed to me that neither had he.
The educated and informed shopper is what we want. I have believed for many years that if people know more about products they do not buy less but more. Therefore, the interests of the consumer and the trader are running on parallel lines. Education is important and this is what we are bending our minds to at this moment. I wonder whether your Lordships ever read this little poem which I think is rather intriguing. I cannot remember its source. It says:
"Why do shops close when its time to go shopping?
Why is parking absolute hell?
Why are replacements not available instantly
And why don't folks know about things that they sell?
Why are there dogs in the delicatessen"—
not for sale, I hope—
"And doors only heavyweight boxers can pull.
Why are writers of labels such liars?
And eye-catching packages only half-full?
Why are we either neglected or bullied, refused things from window displays and high shelves
Why don't they ever stock sizes that fit us"—
and this is the point—
"Why don't we ever stick up for ourselves?"
The legislation is there for the consumer, the good will is there and I hope that this Act is going to prove that we are concerned to see that the consumer gets true value for money.
BARONESS BURTON OF COVENTRY: My Lords, the noble and learned Lord, the Lord Chancellor, said that the Government attached great importance to this subject, as was evidenced by our having two Government speakers to-day. I believe that our debate has justified this; I think it has been an excellent one. We have not had one speech which any of us would call facetious. I know that I am prejudiced in favour of this House, but I think that this House is supreme when it comes to this type of debate. I have the pleasant duty of thanking everybody very much for having taken part in it. I should like

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to join the noble Lord, Lord Drumalbyn, in saying how glad I am that my noble friend Lord Donaldson of Kingsbridge refused to be silenced. I did not see the paper to which he referred. We should have missed his contribution; and we are glad that he took part.
I should like to make just one comment on what was said by the noble Lord, Lord Redmayne. It conveyed an unfortunate impression. We could see that he had a pleasant expression when he said it; but you cannot read a pleasant expression into Hansard. The noble Lord said that referring to retailers I conceded that there were some white sheep. What I did say was this. I spoke of the relatively few black sheep who bring discredit upon retailers and industry alike. I say this only because for years I have tried to remove the word "protection" out of this subject and to talk about consumer education. I should hate to be tarred with the wrong brush.
LORD REDNIAYNE: My Lords, I am sorry I misinterpreted the noble Baroness in her remarks. Perhaps I was being facetious.
BARONESS BURTON OF COVENTRY: My Lords, we will not accuse the noble Lord of that.
My Lords, we never get the replies we should like from Ministers. What we must try to do is to pursue what the noble Baroness meant by saying that the Law Commission's Report and the dates for implementing it were "in the usual channels". I was glad that she mentioned the good work which is being done by the Citizens' Advice Bureaux. I know her experience there and I feel strongly about this matter. I should like to pay tribute to the noble Baroness, Lady Phillips, for the enormous amount of trouble she took to find out the background, long before the debate arose. I would pay her another tribute which perhaps from her point of view may be dubious. I know how difficult it sometimes is as a Minister, knowing the full background, to give the replies that one would like to give. We appreciate that and we are grateful to her for what she has said. I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave withdrawn.

POLICE BILL
Brought from the Commons, read 1a, and to be printed.

SPRINGBOKS' TOUR AND RACE RELATIONS ACTS
7.15 p.m.
LORD FERRIER LORD FERRIER rose to ask Her Majesty's Government whether, in regard to the disturbances connected with the tour of "The Springboks" Rugby Football side, they are satisfied that the provisions of the Race Relations Acts of 1965 and 1968 are being properly administered by the authorities. The noble Lord said: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. I ask it because there is a widespread feeling of anxiety and, indeed, alarm at the disturbance and violence which is taking place on the occasions of Springbok Rugby matches. The debate has begun rather later than I expected because of the interesting debate which preceded it. But one advantage of that is that the evening paper has appeared in the Library. I should like to read from it. a few words. The heading is:
"BOKS BATTLE—THE BIGGEST AND ROUGHEST"
—and "roughest" applies to the crowds. The article reads:
"It was the biggest and roughest antiapartheid demonstration of the Springboks' tour.
"Three police officers were sent by ambulance to hospital suffering from crushed ribs."
It goes on:
"More than 5,000 people—mainly university students—swarmed over barricades, fought police officers, used their banners as weapons and tried to battle their way into the rugby ground.
"Girls screamed as they were trodden underfoot. Youths yelled as they linked arms and ran and crashed into the police barricades.
"They swarmed over the roads, over walls, through the gardens of private houses.
"Terror-stricken mothers shepherded children indoors and locked themselves inside …"
And so it goes on.
Is there any wonder that there is anxiety and alarm? I feel that there is no doubt about it, especially after reading this and judging by the public reaction to the sprinkling of broken bottle-glass on playing fields even before a practice

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game. Was not this, anyway, a criminal offence under common law?
However that may be, the fact that the Motion of the noble Lord, Lord Wade, on demonstrations (December 10) appeared on the Order Paper on the same day as this Question of mine was given a date, goes to confirm that anxiety is felt by others in this House besides myself. The noble Lord, Lord Wade, and I acted quite independently of one another. I am glad that his Motion will be before your Lordships in only a fortnight, because it enables me to keep my speech to the narrower issue of the Race Relations Act—and I concentrate on Sections 6 and 7 of the 1965 Act.
I venture briefly to sketch in three personal experiences which form the background of my approach to the subject. Fifty years ago I played for a well-known Scottish Rugby side. Incidentally, I happen just now to be president of the club. Before that I had played for my school and in the 1918–19 season for a Service side in the Midlands. I particularly recall a match with the New Zealand Machine Gun Corps team which contained a number of Maoris. Incidentally, I recall the seismic experience of a collision with my noble friend Lord Wakefield in a game against an R.A.F. side.
In the mid-twenties I was Rubgy Secretary in the Bombay Gymkhana and I arranged the first match between its all-European side and the High School Old Boys Club which consisted of Anglo-Indians and Indians. This match became a regular feature which I believe continues to this day. Thirdly, I recall the Quadrangular Cricket Tournament in Bombay between four clubs, Hindoo Parsee, European and Mohammedan. The tournament was the reverse of divisive but, alas! the wiseacres thought otherwise, and it was never resumed after the last war.
So, my Lords, first, I have personal knowledge and experience of Rugby football, this superb game which, if not actually a religion, is, to many at least, a way of life; and secondly, I have played it and encouraged the playing of it in mixed communities, and my experience has been that it is not a class game—I put "class" in inverted commas—as some of the Members in another
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place seem to think. Thirdly, my Lords, I believe that inter-communal sport is the reverse of divisive. It follows, therefore, that I am in favour of the visit of a team, whoever they represent.
It also follows that I have no sympathy with the policy of apartheid, though I am satisfied that many critics of it are ignorant of South Africa and the advantages to coloured people there which stem from that policy; however much those advantages are outweighed by the disadvantages. I would add that I respect an individual who prefers to stay away from Springbok matches, or the player who chooses not to play against the side. This is, my Lords, a free country, or it used to be. There used to be freedom to demonstrate; freedom of peaceful assembly; freedom to indulge in sport; freedom to play games; freedom to watch games. Is the only freedom left to be the freedom to stay away, to keep out of the way? Or is this to become compulsory by order of a mob?
My Lords, I drafted my Question and put it on the No Day Named List on November 12, and I confess that were I drafting it to-day I would word it more narrowly still, especially in the light of the prospect of Lord Wade's debate, because a great deal has happened in the last fortnight, and a good deal more to-day.
As I have said, my principal concern is with Sections 6 and 7 of the 1965 Act. May I take Section 7 first, because that section elaborates Section 5 of the Public Order Act 1936 which was passed into law at the time of the Mosley troubles. As I wish to be brief, I think the simplest and shortest way in which to illustrate my contention would be to quote from the speech of the noble Lord, Lord Stonham, on the Second Reading of the 1965 Race Relations Bill on July 26, 1965, at column 1102. I am sure that noble Lords will agree with me that we miss the noble Lord, Lord Stonham, and wish him a speedy recovery. I imagine that nobody regrets his absence more than the noble Baroness, Lady Scrota, who is to reply.
On that occasion, in moving the Second Reading of the Bill, the noble Lord, Lord Stonham, said:
"Clause 7 of the Bill re-enacts Section 5 of the Public Order Act 1936 in extended form. This section provides that 'any person

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who in any public place or at any public meeting uses threatening, abusive or insulting words or behaviour with intent to provoke a breach of the peace or whereby a breach of the peace is likely to be occasioned shall be guilty of an offence.' Section 5 of the 1936 Act is directed primarily to securing that public meetings and demonstrations in public places take place without breach of the peace. Freedom of public speech and demonstration is of little value unless this can be assured and, at the same time, those not taking part are entitled to expect that they shall not become occasions for brawls and disorder, in which members of the public may be injured. The purpose of the section is essentially preventive—either to prevent disorder when a breach of the peace seems likely, or to limit and end disorder that has occurred. This can be effected only by immediate police action, for which Clause 6 is not designed to provide.
As Section 5 of the Public Order Act now stands, it does not state in clear terms to the man-in-the-street that it covers such conduct as the dissemination of pamphlets and waving of banners at public meetings, or the sale of offensive literature in streets. The view has been expressed, and has much to commend it, that in law the word behaviour' as it stands is sufficient to cover all these activities, and that accordingly no amendment of Section 5 of the 1936 Act is necessary. On balance, however, we have thought it right to take the opportunity to re-write Section 5 in extended form, so as to make its scope completely and unequivocally clear, particularly to those likely to be directly affected. The present penalties in Section 5 of the 1938 Act (which are, in fact, set out in the Public Order Act 1963) will continue to apply."—[OFFICIAL REPORT, 26/7/65; col. 1102.]
And so on.
I assure your Lordships that I read that lengthy extract because it saved me saying the same thing and it is put in a very much better way than I could have said it. So much for Section 7. Incidentally, the Preamble to the Public Order Act 1936 is well worth some study. Section 6(1) of the 1965 Act reads:
"A person shall be guilty of an offence under this section if, with intent to stir up hatred against any section of the public in Great Britain distinguished by colour, race, or ethnic or national origins—

(a) he publishes or distributes written matter which is threatening, abusive or insulting; or

(b) he uses in any public place or at any public meeting words which are threatening, abusive or insulting, being matter or words likely to stir up hatred against that section on grounds of colour, race, or ethnic or national origins."

Subsection (2) deals with definitions, and subsection (3) says:
"A person guilty of an offence under this section shall be liable—
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(a) on summary conviction, to imprisonment for a term not exceeding six months or to a fine not exceeding two hundred pounds, or both;

(b) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine not exceeding one thousand pounds, or both; but no prosecution for such an offence shall be instituted in England and Wales except by or with the consent of the Attorney General."

I leave your Lordships to draw your own conclusions in the light of what is happening to-day. These sections in the Act and the Minister's speech at the time—fourand-a-half years ago—of that Second Reading show a remarkable prescience of what might happen and, unfortunately, is happening now. Has the warning been disregarded? As I see it, various of these offences are being committed, not only in connection with specific matches but in general terms almost every day. Is it possible that the Government have been dragging their feet?
I pose another question. If ordinary people are beginning to get apprehensive, and even impatient, should not the authorities act now? Who promotes the "Springboks go back" banners and slogans? Who says that they will, "hound the Springboks wherever they go"? Are they not offenders under the Act? My Lords, I would quote from a speech of the noble and learned Lord the Lord Chancellor which he made on the occasion of that Second Reading. In fact, I propose to make two quotations. One is a brief one which reads:
"I am sure that we all regret that in this country it should ever have been necessary to legislate against intentional incitement to racial hatred. But in the circumstances in which we now live, the law would he detective if it did not provide against it."—(col. 1061.)
Later, the noble and learned Lord said, when dealing with a remark from the noble Lord, Lord Somers:
"Of course, it would be quite possible, under Clause 6 of the Bill. to have a prosecution of a black person for inciting to hatred against white people." (col. 1064.)
Indeed I think that a prosecution has been lodged along those lines. The Home Secretary has done well to confer with Chief Constables but has he gone far enough? I doubt it, if, indeed—and I refer to a news headline—
"Anarchists known to the police are stirring up trouble at the Springboks' matches."

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The same newspaper quotes from the Home Secretary's interview:
"The right to demonstrate, whether the demonstration is a popular one or not, is a cardinal right of the people of Britain. But there is a difference between demonstration and destruction.
"I would do nothing to interfere with traditional right. But it is a fact that a job lot of anarchists have got on to the antiapartheid demonstrations for the sole purpose of fomenting violence."
If that is the case, are they not committing offences under this Act and inciting offences against the common law? And if they are known to the police and are identifiable, should they not be brought to justice? I look forward to the reply of the noble Baroness, which will, I hope, clear this up.
At the moment a situation has developed in which ordinary people going about their affairs feel impotent in the face of disorder and violence by a comparative few. Do not the polls show that most people in this country want this tour to continue? Such feelings of anxiety can perhaps have the most disastrous effects, the very reverse of what the demonstrators seek. I commend to your Lordships a letter from a South African, a Mr. E. Webster, from Balliol College, Oxford, which appeared in The Times on Saturday, and with your Lordships' permission I will quote the last two paragraphs, in which he writes:
"But what disturbs me in particular is that the majority of that moderately tolerant group of the British public (revealed in the recent Colour and Citizenship report), will become increasingly unsympathetic to the d'Olivieras of this world and will be easily led by unscrupulous politicians along the path of race hatred.
"Furthermore, a factor which is uppermost in my mind as a South African, is that the totally irrational, negative and hysterical reaction of the South African public will find a vindication in their intransigent attitude if the protest simply ends in senseless violence. The path to racial tolerance and harmony is not an easy one, but the prejudiced personality is certainly not likely to be convinced by coercion."
To conclude, if the Government find themselves unable to do more than they are doing now, then, when the Act comes to be amended, as seems inevitable and as I hope, as a Scotsman, imminent, should not any such amendment include that the provisions of Sections 6 and 7 be strengthened or enlarged to protect law-abiding citizens from disturbance?
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Not only that, at whose charge is all the cost of the damage, the crush barriers, the minions of the law, the transport dislocation and now, as I read, the destruction of private property, not to mention the quite unreasonable demands being made on the long-suffering individual policemen, who are being faced with difficult and arduous and even dangerous duties when, admittedly under strength, they have other things to do?
If the position is not clear enough as it stands—believe it is—then let the matter be clear beyond a peradventure before the visit of the South African cricket team next summer, when disturbances in cricket grounds will be more difficult to contain than they are on the hitherto sacred turf of Twickenham or Murrayfield. There are some points which I have not mentioned and which will doubtless be dealt with by other speakers and other points which will emerge during the debate on December 10, and I shall resist the temptation to say more, unless it be to conclude by saying that, like some other noble Lords from Scotland, I attended the Annual Rededication Parliamentary Service at Crown Court Church this morning and in the course of his Prayer of Intercession, the minister prayed:
"Where there is turbulence and violence let there instead be harmony and hope."
My Lords, it is in that spirit that I ask my Question.
7.35 p.m.
THE LORD BISHOP OF CHESTER: My Lords, I am sure that the House is grateful to the noble Lord, Lord Ferrier, for asking this Question and for giving us an opportunity for a short debate upon a matter which is very much in the minds of us all. In making my contribution I must say things that I believe must be said, though I would far rather not have been compelled to do so; but I think that we must go rather more deeply into the background of the situation which has arisen.
I am confident that your Lordships will give unanimous agreement to the view that politics should have no place in sport. Games should be played for what they are, a test of skill and stamina between individuals or teams, with no other factor impinging upon the outcome than the incentive of beating one's opponents fairly by a superior display of

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expertise. But with the growth of international sport it has become more and more difficult to observe this ideal, and from time to time—for instance, in the Olympic Games—there have been reminders that the elements of national prestige and national politics are never far from the surface and all too easily break through, to vitiate the integrity of the sport and embarrass those who hold strong views about their undesirability.
Such, in my view, is the situation that has arisen over the visit of the Springboks to this country. I do not think it is denied that this team was chosen according to the application of the principles of apartheid. Politics have played their part in the selection of the team that is touring this country. I have heard it said that it is wrong for us in this country to protest against the presence of such a team in our midst because by doing so we are bringing a political judgment upon a situation that ought to be free of politics. But, my Lords, it is not we who are bringing politics into sport: it is the South African authorities who have done so. And I would hold that by playing games against a team which avowedly has been selected on grounds of racial discrimination we involve ourselves in bringing politics into sport, and that the only way we can uphold the principle that politics have no place in sport is by refusing to participate with those who openly apply racial standards in the selection of their teams.
I believe that, however acceptable may be the individuals who compose a team in a sporting event, and however innocent they may be, as individuals, of political motives, it is nevertheless undesirable to welcome to this country visiting teams in the choice of which race and colour have been a deciding factor; and I would uphold the right of those who feel strongly about the principles which are involved to make their protest known as effectively as they can do so.
How is this to be done? I think I can understand the views of many who feel that there must be some physical manifestation of their principles. They believe that this is the only kind of opportunity they have of making known their views about apartheid and they have some reason to think that, unless their protest is unmistakably seen and heard to be made, the absence of such evidence may
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well be construed in South Africa as evidence that we do not care. But I am equally sure that anything other than peaceful demonstration and protest is ill-conceived and ought to be condemned as strongly as 'we can do so. There may be some who genuinely feel that they must indulge in physical violence and must attempt to prevent matches from taking place. This I believe to be wrong in principle. I believe that such behaviour plays into the hands of less scrupulous people, who do not care a fig for racialism and whose only purpose is to seize upon any excuse for making trouble. Such attempts, moreover, deny the democratic freedom of those who wish to watch such matches. Again, violence begets violence, and its use in support of an ideal, however worthy, is likely to produce reactions the very opposite to those which the protesters would desire. So I trust that this House will unequivocally condemn the use of violence in making protests of this nature.
However, I would repeat my conviction that it is undesirable that sporting teams chosen on grounds of racial discrimination should come to this country: for by welcoming them and co-operating with them on the field we knowingly or unknowingly implicate ourselves in the political issues which have determined their selection. We defeat our object if we try to express our approval by indulging in physical violence and hooliganism. I believe that we can best express our feelings by staying away from matches; by bringing pressure to bear upon governing bodies of sport to refuse to allow teams in this country to play against those chosen on discriminatory grounds or to send teams from this country to them; and by suggesting to those responsible that facilities in this country should not be made available for such games.
It is to be hoped that by now the message will have reached South Africa, and that it will be appreciated there that many people in this country do not think it right to welcome teams until we can be assured that the standard which has been adopted in the selection of a team is that of skill, arid skill alone.
7.42 p.m.
LORD WAKEFIELD OF KENDAL: My Lords, I am sure the House is most grateful to my noble friend Lord Ferrier

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for giving us the opportunity to discuss the disturbances that have taken place and are taking place outside and within Rugby fooball grounds arising from the tour of the Springboks Rugby Football side from South Africa. Public attention has been drawn to the working of the Race Relations Acts in connection with other matters that have taken place recently quite unconnected with Rugby football. It seems to me desirable that there should be an authoritative statement in this House on the working of these Acts, and in particular on their application in respect of demonstrations that have taken place arising from this South African Rugby Football tour.
First of all, however, I should like to declare an interest, in that I am a past President of the Rugby Football Union and at the present time act as one of its trustees. Also, for a number of years I represented England on the International Board which is responsible for the control of the playing of international Rugby football and the amending, as and when desirable, of the laws of the game. Both this International Board and the Rugby Football Union have always been most concerned to keep politics out of the playing of the game of Rugby football. They have been greatly encouraged in such wishes, because in the years immediately following the First World War, when Ireland became politically divided, the Irish Rugby Football Union continued to represent both the North and the South, and politics were kept out of the game in Ireland, to the great advantage of the game and, it is hoped, of politics as well. As your Lordships will know, because of recent political disturbances in Northern Ireland the Springboks game due to be played in Belfast on Saturday has been cancelled.
When a few years ago South Africa became a Republic, that political fact in no way altered the happy and friendly relationship between the South African representation on the International Board and the rest of the Board. From time to time, when international matches are played the Rugby Football Union impartially invites members of the Government of the day and the leaders of the Opposition to watch the game, and afterwards at the dinner in the evening when the game is over, if the principal
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guest invited to speak is a politician, then he may be either a member of the Government or of the Opposition Shadow Cabinet. Therefore the disturbances that have recently been taking place on Rugby football grounds in England and Wales have been deeply regretted by the Rugby Football Union and the Welsh Union, whose only desire is to keep clear of politics and look after the playing of the game. The Rugby Football Union are solely concerned with the organising of the game in England in the best interests of the players, in the expectation that the more the players enjoy the game the better will it be for players and spectators alike.
I am making this point at some length to your Lordships because recently, prominently reported on the front page of the Daily Telegraph was the following statement by Mr. Russell Kerr, the Socialist Member of Parliament for Feltham and Chairman of the Socialist Tribune Group. This is what he said:
"I deeply regret that the Rugby Union should be engaging itself in politics in this way".
It is difficult to imagine a more distorted, biased and untruthful statement. The facts are that the four home Unions of England, Scotland, Ireland and Wales have invited a Rugby football team from South Africa to visit the British Isles to play Rugby football as they are fully entitled to do.
It is over 60 years since the first team from South Africa visited the British Isles, and more than 70 years since a touring side from these Isles first visited South Africa; and there have been many visits since then. The sole purpose of these visits is for players and spectators to enjoy themselves in watching a game of Rugby Union football played by a team from overseas. So far as the Rugby Football Union is concerned, politics has never entered into the playing of these games, nor does it now. The sole responsibility for the bringing of politics into the playing of the game of Rugby football has been with others. The players and spectators gathered together on a privately-owned Rugby football ground to enjoy themselves in playing and watching a game of Rugby Union football do not deserve this legal and peaceful enjoyment of their leisure time to be broken up and destroyed.

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Players and spectators are entitled to be protected, exactly as I should be entitled to be protected if I were giving a private party in my flat and people entered on to my property to break up my party. I am entitled to throw them out and, if necessary, to get the help of the police in doing so. The noble Lord, Lord Elton, had a letter in the Daily Telegraph a few days ago which makes the point very well. He said:
"'Police accused of aiding vigilantes'; Springboks at Swansea, your headline (November 7). If a mob invaded my garden and the police helped me to turn them out would they be 'accused'?"
That is the end of the letter.
When Oswald Mosley and his Black-shirts some thirty years ago started causing disturbances on racial grounds it became necessary to introduce the Public Order Act 1936, as my noble friend Lord Ferrier has already said. The Race Relations Acts of 1965 and 1968 are, as he has pointed out, an extension of that Act. It seems to me, and to many others as well, that people have been guilty of offence under Section 6(1) of the 1965 Act, because without any doubt numbers of people have been quite deliberately stirring up hatred on racial grounds within and outside Rugby football pitches. Many of those demonstrating have used words which are abusive and insulting, and they have been deliberately so used to stir up hatred on grounds of race and national origin. Since this is the case, the public are entitled to know what action the Government are proposing to take to prosecute people guilty of misbehaviour. The noble Lord, Lord Ferrier, has already drawn attention to Section 6(3), which concerns penalties, so there is no need for me to take up your Lordships' time by reading them again, but I think that if the Government made it known very clearly that they were not going to countenance any further scenes of disorder and violence on or outside Rugby football grounds, and that there would be prosecutions under the Act, we might well see this violence cease.
I make a strong distinction between those peacefully demonstrating in public places and others whose sole object is to stir up trouble on private property against the wishes of the great majority assembled on that private property for lawful and peaceful purposes. It is in-
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teresting to recall that it was the National Socialist leader, Hitler, who first brought politics into sport in a big way in the Berlin Olympic Games in 1936. When the War was over the Iron Curtain countries were quick off the mark in realising the importance to them of mixing politics with sport, and sport was fully exploited by the Communists for political ends. It is, I think, significant that people who have been causing these disturbances within as well as outside Rugby football grounds—and again I make the distinction between violence and disturbance, and peaceful demonstrations—are the same sort of people who are to be found protesting and demonstrating on all and every occasion, especially on Sundays, that suits Communist policy. And, of course, they avoid such occasions as when the Russians invade Czechoslovakia, or when a wall is erected in Berlin to prevent people from leaving East Germany because of the intolerable conditions in that country.
When the Springboks were playing their first match against Oxford University at Twickenham three weeks ago, your Lordships will recall seeing on television, as well as in the photographs in newspapers, an old man in shorts being led from the pitch. He had invaded the playing area at half-time. This individual was none other than 60-year old Bill Laithwaite—a leading Surrey Communist. Why did not the B.B.C. and the newspapers report this item of fact? Why do not the newspapers and the B.B.C. report that the planning and the driving force behind these disturbances and violent demonstrations come from Communist anarchy sources? These people wish to disrupt our way of life and cause anarchy in our midst.
People in our country are allowed wide freedom, as indeed they should be, to demonstrate and protest by peaceful means. If, however, this freedom is abused, as it now is, by deliberate interference intended to provoke violence of lawful and peaceful behaviour by law abiding citizens on Rugby football grounds in the United Kingdom, then just as surely as I am addressing your Lordships to-night our ancient rights and privileges will disappear. That is why it is so important for the Government immediately to take firm action under the Race Relations Acts. If the Government do not do so, then the Race

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Relations Acts are meaningless jargon; and, what is also so important, the law is brought into disrespect.
The noble Lord, Lord Ferrier, has already drawn attention to the wording of the Race Relations Act, and I must say that I find it extraordinarily difficult to understand how it comes about that a Scottish family wanting a Scottish cook to make them porridge for breakfast offend against the Race Relations Act when they advertise this employment requirement, but people who invade private property and then cause a disturbance for the sole purpose of inciting racial hatred apparently are not offending. If they are offending, then why have the Government not taken action before now? May I remind the Government of what the noble Lord, Lord Stonham, said in the debate already referred to by the noble Lord, Lord Ferrier. I quote:
"Taken together, the powers contained in Clauses 6 and 7 will enable the police to deal with the rabble-rousers in the street, and with the back-room organisers …"—[OFFICIALL REPORT, 26/7/65; Col. 1013.]
If this gives to the Government the necessary powers in the street, then surely they have the powers even more strongly to stop these rabble-rousers from creating disturbances on private property. Moreover, in the process of causing this disturbance among people gathered together for lawful and peaceful enjoyment of a leisure pursuit, these hooligans, some of whom are under the influence of drugs, use filthy and obscene language. For innocent and peaceful players and spectators to have threatening epithets and obscene abuse hurled at them, even before a game has started, such as, "You masturbating Fascist pigs" is quite intolerable.
To judge by some of the things said on the B.B.C., and reported in certain newspapers, coupled with the use of the word "vigilantes" instead of the time-honoured and well-understood word of "stewards", people might be excused for thinking that there had been encouragement by the Rugby Football Union for stewards to rough-handle these disturbers of the peace who invade the playing area, which in any case would be only what they deserve. The facts are exactly the opposite. Prior to statements which have been made during the past
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48 hours, strict directions had been issued by the Rugby Football Union to those clubs and unions responsible for organising the playing of matches against the Springboks. They have been told to instruct all stewards that they are there only to assist the police to remove demonstrators from the playing area if requested so to do by the police. Furthermore, that they should not on their own remove demonstrators by force, and that in no circumstances whatever, and no matter how great the provocation, should they retaliate in any way.
Finally, stewards when on the pitch should be clearly distinguishable to each other and to the demonstrators. Stewards give, and always have given, their services voluntarily. They have never been paid, as was suggested by the Home Secretary in another place a day or two ago. I have seen the police, assisted by stewards, in operation on two occasions recently, doing their best to preserve law and order while undergoing the most filthy abuse and deliberate provocation by people not assembled to watch Rugby football but to cause disturbance. No tribute paid to the patience and forbearance of the police in such circumstances can be too high. I hope that the Government will take the opportunity that this debate provides to commend the police for the loyal, patient and quite outstanding manner in which they discharge their difficult and exacting duties in the public interest.
Next year, to commemorate the celebration of its centenary, the Rugby Football Union have invited a team from Fiji to pay us a visit. I cannot but help wonder whether the Government would not have taken action before now if, instead of the Springboks, the Fijians had been our visitors this year and they had been subjected to the same kind of provocation, intended to arouse racial hatred, as have our present visitors.
In conclusion, your Lordships will have noted that I have made no reference at all to the arguments for and against the policy of apartheid which is being pursued in South Africa, and on which subject there are such deep feelings. What I am drawing the attention of the Government to is the fact that this touchy subject of apartheid is being used by the Communo-anarchists to stir up violence and hatred, with anarchy the ultimate

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object in view. I am sure that the Government have in their possession the necessary evidence, as I have, of the people behind these disturbances and their known Communist affiliations. In so far as the principles of apartheid are concerned, these people could not care less. What they are interested in is the fact that this subject is a convenient vehicle for the disruption of our society.
8.1 p.m.
LORD O'HAGAN: My Lords, one of the main reasons why I come to your Lordships' House is to learn, and one of the more important things I have learnt is how controversial subjects ought to be discussed-subjects such as that under discussion at the moment. The calmness and tolerance that is often found here does so much good. Race, and people's views on matters connected with race relations or discrimination, are "hot" subjects; and we have a very great responsibility when discussing them.
I do not like apartheid. I think it is indefensible; it degrades those who benefit from it, as well as those who are discriminated against. Nor do I like violence. But I feel that your Lordships ought to continue to help to provide sensible leadership when matters like that under discussion to-night are before the public eye. Yesterday the noble Lord, Lord Brooke of Cumnor, chipped away, unintentionally or not, the chances of calm discussion continuing here. To-day we have had another discussion capable of misinterpretation, and the unnecessarily violent speech of the noble Lord, Lord Wakefield of Kendal. I live in Fulham. Two streets away from my home is a big wall—I think it is the wall of the gasworks. On it, in letters about 2 ft. high, is written: "Enoch's all right. So keep Britain white."
There is a great deal of fear; there is a great deal of ignorance, and a great deal of reactionary unrealism about. However calmly the noble Lord, Lord Ferrier, made his case, I shall be sad if the message that goes out from this House, particularly to the Commonwealth, tonight is that the principle of fair treatment for all citizens takes second place to games of Rugby. My Lords, if it does, the noble Lord, Lord Ferrier, will have done infinitely more harm than good. I fear that he may have done
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so; and if he has not, the noble Lord, Lord Wakefield, has.
8.4 p.m.
LORD BROUGHAM AND VAUX: My Lords, the wind has been taken out of my sails by what has been said already. I should like first to welcome the Spring-boks here on behalf of myself, and also I feel, on behalf of the great majority of the people of this country, lovers of this sport. I should like also to wish them luck and wish them well. I do not particularly approve of apartheid, but they probably do not approve of many of the laws that we have in this country.
If one wants to discriminate against South Africans coming to this country, one has to consider which is the lesser of two evils. The Russians can come to this country—your Lordships may think that this is a red herring, but it has been slightly touched on in a different context to-night. I know that Russia is a Communist country, but if they can murder people just because they do not do as they are told, I think that what we are faced with by this visit is the lesser of two evils. If any people should not be allowed to come to this country, it is the Russians. If we stop nationals from both these countries from coming here, then that is the end of international sport.
I should like also to-night to congratulate the police on the job they are doing. I wish them all the luck, support and strength they need to carry out their duties to the best of their ability, and in their attempts to please everybody without treading on the toes of the hooligans (for that is all these demonstrators are; they are very much a minority), while, on the other hand, they are beaten and suffer internal injuries, fractures and the like.
As I have said, many of the points I was going to raise have already been mentioned, and at this hour I do not think it worth mentioning them again. I have noticed what has been said about to-day's incidents. They took place a quarter of a mile away from the ground where the match was actually being played. I do not know whether one can draw any consolation from this or not. But in this country it has always been a right to air our views through peaceful demonstrations. This right has now more

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or less disappeared, and we have come almost to the stage of bloodshed. If these hooligans want violence, then I think the police ought to be given more assistance with troops, who can give just an extra bit of weight and push them away. If that does not work, then I suppose it will have to come to the police standing there and using their truncheons. We shall then see just how close the demonstrators actually get to the police. I am sure that they would keep well away from the police, who would not have to move an inch.
My final point is that I should like the Press to give more space to the actual games of Rugger and not so much to the demonstrations, because it only blows the situation up for a bigger and more violent demonstration at the next Rugger match.
8.8 p.m.
LORD BROCKWAY: My Lords, I apologise for not having given notice that I wish to take part in this discussion. I want to do so as a Rugby football enthusiast. Sixty years ago Rugby was my religion, and Rugby is still my escapism. I regard it as the greatest sport in the world. I went to a school with only 90 boys. We regularly provided international players: Gillespie of Scotland, Fahmy of Wales, the great Gracie of Scotland. Indeed, when I left school I had no greater desire than to become a Rugby international. My devotion to Rugby was one of the reasons that made me a Socialist. On 15s. a week I could not stand the cost, the social cost, of Rugby clubs in London. Although I felt that frustration, I retained my devotion. The beauty of the passing movements across the field! The times I have watched the noble Lord, Lord Wakefield of Kendal, leading a forward attack! They are some of the highest memories of my enjoyment in life. It is because of this enthusiasm for Rugby football that I am taking part in this debate tonight.
One of the reasons for my devotion to athletics and sport is because of its internationalism. One thinks of the Olympic Games, with the great principle that neither politics nor race nor religion must deny the right of any team to be represented there. I pay my tribute at once to our Rugby Union for the contribution which they have made in Ireland, to Northern Ireland and Southern Ireland
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playing together. One thinks of great athletic meetings and the inspiration of seeing them upon television, with Negro athletes representing America; with all races and all colours, with the yellow races of Asia there, too. Anyone who has a real understanding of athletics and sport must have the understanding that a man or woman who is to be regarded as great in athletics and sport must be so because of capacity in the game and not because of the pigmentation of their skin and their birth.
My Lords, it is partly this devotion to the philosophy of athletics and sport that makes me regret so much that in South Africa this principle should be repudiated. There, no African can play with a white European. There, no coloured person can play with an African. There, no Indian can play with any member of another race. South Africa to-day is repudiating the very essence and philosophy of those of us who treasure athletics and sport, in the way that many of us do. It is not those who are protesting against this denial of the very essence of sport and athletics who have brought in politics. It is the South African Government, which denies the right of the great majority of its population to be chosen for a South African team. I know it is sometimes said that no one but a white in South Africa has the athletic quality to be chosen for their team. One would not be surprised if that were true, when one considers the football fields on which those who are not white have to train and have to play. But it is not true. With my knowledge of Rugby football I could recite many names of non-whites in South Africa, even under the conditions there, who would have won on any inter-racial basis the right to represent their country on the international field. I can think of one at this moment who has become a professional and for whom Australia has paid a large fee because of his great ability as a Rugby player. So, my Lords, it is not those who are protesting against the presence of the South African team who are introducing politics into sport. It is the South African Government which has done so, and those of us who believe so deeply in the essence of athleticism and sport are sorry that any Government in the world should have introduced this element of division.

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My Lords, I want to speak briefly but I must make some comment upon the extraordinary argument that we have heard tonight that the Race Relations Act should be applied to those who have been demonstrating against the white South African visit. I have been described—and I do not think he will mind my mentioning this—by the noble and learned Lord the Lord Chancellor as the author of the Race Relations Acts, because year after year when I was in another place I introduced Bills which ultimately found expression in the Acts. What has been the purpose of those Acts? The purpose has been to make illegal the practice of discrimination on the grounds of race or of colour in expanding spheres, beginning in public places, moving on now to housing and employment and to financial contracts. The purpose was to indicate that our nation stood against racial discrimination.
LORD FERRIER: My Lords, if I may interrupt the noble Lord, I thought I had made it perfectly clear in my opening speech that the issue as I see it is a narrow one concerning Sections 6 and 7 of the 1965 Act, and no other Section of any Act have I mentioned.
LORD BROCKWAY: My Lords, I thank the noble Lord, but I do not think what I am saying is irrelevant to his argument, to which I listened with great care. I am trying to speak with a certain absence of intensity, and this is partly because as a Rugby footballer I have appreciation both of the noble Lord who put down this Unstarred Question and the noble Lord, Lord Wakefield of Kendal. I know their contributions to the Rugby game. What I was trying to say was that the purpose of the Race Relations Acts was to declare on behalf of this nation that we are opposed to discrimination on the grounds of race and of colour, and those now opposing the coming of the South African team are opposing it exactly upon those lines. How in the world a Race Relations Act can be used against those who are demonstrating this right to human equality I do not begin to understand.
I will just add one further thing before I conclude. I am against the violence which has been shown by demonstrators. I was at Oxford at the time of the cancellation of the University match
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there. I spoke to students and I warned them of the backlash which would come if violence was shown in these demonstrations. But the great majority of the students who are protesting now are doing so from the highest motives: because they believe in human equality; because they believe that human personality is greater than any difference of race or colour; because they believe that this spirit ought to animate the international sport which we love, which Britain has done so much to contribute to the world. My Lords, in that spirit I hope that we shall reject the arguments which have been put forward tonight, and applaud those who regret the presence of the South African team, because it denies the very spirit of human equality for which this nation stands.
8.20 p.m.
EARL FERRERS: My Lords, we are grateful to my noble friend Lord Ferrier for introducing this Question, because it has enabled your Lordships to have a debate on a subject which is of very considerable public interest. I consider that anyone who takes part in a debate of this nature realises that he has a very "hot potato" and must indeed be moderate and careful in what he says. No one could have been more moderate and careful than the right reverend Prelate the Bishop of Chester, who, if I may say so, put his case, which was necessarily a fairly strong one, with the least possible cause of upset to anyone. If I could emulate that in one small iota I should be grateful, but I doubt whether I shall succeed.
We have of late had an increasing number of demonstrations, and these give the public cause for deep consideration. I am not one of those who feel that to demonstrate is to exercise democracy, albeit one may be availing oneself of a privilege of democracy. It has always seemed to me curious, when one looks back over the years and thinks how hard the pioneers have struggled to get to a state where we can call ourselves democratic, that one can sit back and reflect that the greatest sign of democracy is that people may demonstrate because their views are not accepted.
The problem will come when the Government have to decide between the undoubted right of people to demonstrate and the even more undoubted rights of

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people to go about their lawful life or pleasure without let or hindrance. I would impute no particular emphasis to either; I think that both are important. But they are necessarily conflicting, and the conflict seems to be becoming greater. I listened with immense interest, as one always does, to the right reverend Prelate, and I hesitate to comment on what he said for fear, as it were, of being taken in the wrong way. But perhaps I may just say that I think we might be on dangerous ground if we accepted his assertion that we should not play games with people who come from a country whose Governments or way of life we do not like or accept. One entirely understands his views in saying that, but I should think that this would be a dangerous precedent indeed.
THE LORD BISHOP OF CHESTER: My Lords, perhaps the noble Earl will allow me to interrupt. I did not say that we should not play games with teams coming from countries whose policies we do not approve of. What I said was that we should not play games with teams which themselves represent a policy that we cannot accept.
EARL FERRERS: My Lords, I bow to the right reverend Prelate's definition, but I should have thought there was not a significant difference. However, be that as it may, I accept what the right reverend Prelate has said. I also accept fully the views of those who feel, as indeed he did and other noble Lords did, that the Springboks side is unacceptable to them personally because it contains no coloured people. I accept the fact that if they feel the desire to express their dissatisfaction at this they may have the right to demonstrate. But I do not accept that they have the right to demonstrate in such a manner as to prevent others from going about their lawful business of enjoying a match.
But, my Lords, have these people the right to demonstrate? What are they demonstrating about? It is surely that the team is composed solely of one type of person; that the team is not composed of a mixture of races but is composed solely of white people. The essence of the demonstration must therefore necessarily be racial. If one were to imagine a situation where a team of coloured
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people were playing a match and there was a demonstration against them, this would be infringing the Race Relations Act. Surely, therefore, if there is a demonstration against a team not composed of coloured people but composed solely of white people; if this is the essence of the demonstration, this must surely offend against the Race Relations Act.
I should have thought that if anyone wished to consider this he would have need to go no further than Section 1 of the Race Relations Act 1968, which says:
"…A person discriminates against another if on the ground of colour, race or ethnic … origins he treats that other …less favourably than he treats or would treat other persons …".
Nobody likes a situation where demonstrations such as this are caused. One would hope that in the future some way will be found of making one's perfectly legitimate complaints against a régime or a society in such a manner as does not conflict with the lawful business or pleasure of other people.
I once suggested to your Lordships that I had coined a law, which I described as "Ferrers Law", which says quite simply that everything has the reverse effect of that intended. I cannot but believe that that is possibly the case with the Race Relations Act, because this is an Act which was designed to prevent racial discrimination against coloured people. In fact I should have thought that there is here an argument that it bears completely the other way round, where you have a situation in which there is discrimination against a side because of its racial make-up. I have never liked the Act because, instead of harmonising people of different ethnic backgrounds, it has had completely the reverse effect. It has tended to polarise people into different groups, each trying to find out what are their rights and duties and privileges and protections under the Act; and this I believe to be a wholly regrettable state of affairs. I do not believe that it is a unifying Act. But the fact is that we have the Act, and it should be brought to bear equally for the protection of one section of the community as for the other.
I wonder for how long we shall have to suffer policemen being injured and knocked about by these demonstrations,

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with little being done to protect them, all to allow the so-called freedom to demonstrate. Ten were injured at Swansea; another four to-day taken to hospital, as your Lordships have heard, with crushed ribs. Where is the freedom here? Where is the freedom for those who genuinely wish to watch the match, who want no truck with race relations? Where is the freedom for the mothers, as my noble friend read from the paper, who had to lock their children up in their houses for fear of the demonstrations? The Government have an Act to preserve law and order, yet they seem to be making little use of it.
I have heard a report that 200 students from Edinburgh had their fares paid to go down to Swansea to join in the demonstration. We know that the genuine demonstrator has a right to put forward his views, but surely he must also accept some liability if by airing his views he attracts a considerably larger element of rowdy people who are not concerned with expressing his views but merely want to have a punch-up. This is the danger; that if the one genuine band of demonstrators attract a large crowd of rowdy people they themselves will, in the end, prejudice the right of the genuine demonstrators to demonstrate. This is what we should guard against. So I would ask the Government this simple question: what are they doing to ensure that the rights and the privileges of those who demonstrate do not make inroads into what I consider to be the far greater right and privilege of the many who wish to live their lives and to go about their work or their pleasure in peace and quiet.
8.32 p.m.
LORD STRANGE: My Lords, I am a chalk jockey. I apologise for that, but I put my name down at the door and it has been reported to both Benches and also to the Desk. The reason I did that was that I did not know whether or not I was going to speak, because I thought that other speakers before me would have covered very much better than I could have done everything that I was likely to say. But they have not, which is most surprising. However, I can guarantee to your Lordships that I shall not keep you any longer than necessary, because I have only about three or four things to say. I may say to your Lordships that I have just received a "wire from the turf" to
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say that there are four other speakers after me. That is pretty serious but still!
I know we are most keen on teaching and preaching democracy to everybody outside the country. Why on earth do we not have democracy in this country? That is the point I am speaking on. I know quite well that there are here a number of rugger players. Lord Brockway was a rugger player. We all agree that sport is outside politics. For goodness sake, let us leave politics out of something! Let us have sport free. I am sure that everybody in this House resented the attitude of the South Africans in trying to pick the cricket team we wished to send over there last year. It is against all the interests of sport and everything else. I am sure that nearly everybody in his heart objects to these disturbances against the team that they have chosen to send over here. We do not want to go into this question of racialism in the matter of sport. For goodness sake, let us keep it clean! Lord Wakefield, Lord Brockway and myself were all keen rugger players. We never thought about whom we were playing against. I should not have minded playing against black, yellow, green or whatever colour the people were; I wanted to play, and I liked it. For goodness sake, do not dirty sport with racialism or anything else! Just forget it. They have sent over here the people that they want and we should play against them. Let us leave other things out of it.
The point that I have got up to raise is this. So far as we can, let us keep this country a democracy. People, Wat Tyler, everybody else, are entitled to collect the masses together and to march. We recognise that. We recognise that it is the British way of showing a grievance. They march along and wave banners, they shout and yell. They cannot be stepped because it is part of the British democratic way of life to do this. People are allowed free speech. But they are also allowed liberty of the individual. That is basic. The noble and learned Lord the Lord Chancellor will be able to correct me if I am wrong, but I think it comes from Magna Carta, that in time of peace people should be allowed to go about in freedom.
These marches are great fun; but they impede the traffic. They are damaging

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for the police and often to other people. They are inclined to be riotous, which we do not want. They are inclined to break up buildings; we do not want that. The point is that they hold up traffic, they sometimes damage people, they are extremely noisy and they interfere with the liberty of other individuals. That is not democracy. Other individuals should have their liberty. They should be able to go about and do what they like. They should not be stopped by people marching down the street. But the people marching down the street should not be stopped, either. They have their point in regard to democracy. They are very angry about something—in fact, furious. They wave banners. They have all sorts of weapons to throw at somebody else. They should be allowed to do that.
But what we want to achieve is fairness to other people, the nice people in this country who do not riot, who stay quietly at home. They know what they want, or what they think they want, but they do not want to get bowled over by the rioters going down the street. What we should do, therefore, is to have a circular track on which it is legal for platforms and speak, shout and yell, and forms so that they can get up on the platforms and speak, shout and yell, and throw anything they like at each other, and we should have a quite limited police force to keep them in order. We should have organising points on this circuit where these people can organise themselves to march. They should be kept at a distance apart so that they do not start a fight with each other. If they want them, we should have Members of the Houses of Parliament—yes, Members of the House of Lords, too, if they will go—to stand on those platforms to answer questions. These people like asking questions. Let them be answered. They should march round as many times as they like. if the British public want to go and look at them, let them. We should have places for them to stand. They could buy hot dogs, or fish and chips; they should sit down on the grass and should be allowed to listen. These people should be allowed to run down anybody they like—the Queen, the Royal Family, the whole Constitution, the House of Lords even.
At the end of the day they will be tired. They will have said their say.
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Then they would go to a disbanding point and go quietly on their way. But do not let us have them marching down the streets, collecting in squares, upsetting people who do not even like them and who think they are a bore. Let them attract the people who like them. There is always a Hyde Park or places such as that at which people can speak. Give them a proper route to march down with their banners. At these matches I think they should be conducted to a held where they can march round and wave their banners, but not interrupt people who want to go and see a game of Rugby football. What on earth has that to do with politics? I cannot see any connection at all between these two things. Some people want to see others playing a game.
We are a little nervous about the way in which South Africa is not run quite as a democracy. But that has nothing to do with sport. Do not let us have students coming down from Edinburgh. Perhaps we should let them come, but let them have a field on which to march, where they can shout and do anything they like other than upset the ordinary citizen who has come to see a game of Rugby football. That is all I have to say.
8.39 p.m.
LORD BURTON: My Lords, I, too, apologise for not having put down my name, but I had hoped that this point would be made by someone else. It is only one point, and it is that if these scruffy, long-haired children who make up the majority of the demonstrators were to get no publicity for their demonstrations, would they continue to demonstrate? Is it necessary for the Press and the B.B.C. to give them all the publicity that they do? It seems to me that it is this publicity which is costing the country so much money and trouble to keep law and order.
8.40 p.m.
TIIE LORD BISHOP OF DURHAM: My Lords, I, too, apologise for having been unable to give notice of speaking, and especially for being unable to be here when the noble Lord, Lord Ferrier, introduced the discussion. I entirely agree with all that has been said about the distinction we need to make between peaceful demonstrations and violent

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demonstrations; of the democratic need for the one in certain conditions of society, the justification for the one, and the lack entirety of justification for the other.
That point aside, I should like to approach from another direction, and quite briefly, a point which the noble Lord, Lord Brockway, made, and which I believe the right reverend Prelate the Lord Bishop of Chester made. My point is centred round the question: can politics and sport be kept apart on this occasion? I do not know enough about the details of the Irish situation in regard to those Irish Rugby games in the past, but the Race Relations Act apart, it would surely have been an entirely different matter if the Northern Ireland team had excluded, on a principle enunciated for everyone's knowledge, people born South of the Border, people who had not been Unionists, and people who were not members of the Orange Order. That would inevitably have made the team from Northern Ireland politically biased and politically expressive. It could not help but have done. I think that situation is closer to the one we have before us now.
The truth is that politics have in fact entered into the playing of this game, and by none of our doing. Sport and politics have now met together because they have entered into the selection of the team, and it seems to me that that fact itself makes the games occasions which stir up racial trouble. Inevitably the team becomes a symbol of racialism, though no member of the team may himself wish for that. The team cannot help but be a symbol of racialism because of the principles on which it has been selected. As I say, the Northern Ireland case would have been just the same had that team been selected on the principle of allegiance to the Unionist Party or the Orange Order, or whatever it was. They were not selected on those principles, and therefore the Irish situation was undoubtedly helped by these games occurring.
Surely we have to be very careful that sport does not have the political overtones which have in this case been given to it by a Government not our own. It is those political overtones which this team expresses which form the cause of trouble in this case; and they are overtones which, as the noble Lord, Lord Brock-
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way, said, entirely deny the philosophy of sport which we treasure in this country. That, my Lords, I submit, is the real issue behind the present disturbances.
LORD WADE: My Lords, I should like to make it clear that my only reason for not taking part in this debate is that in a fortnight's time I am due to open a debate on the subject of demonstrations. The noble Lord, Lord Ferrier, very kindly referred to this. At the same time, I should not like my silence to be implied as agreeing with the varied arguments that have been put forward in support of this Motion. I think perhaps the fairest thing I can say in one sentence is that I think it is commendable that the youngest Member of your Lordships' House who has taken part in this debate should have spoken with such wisdom, moderation, and good sense.
8.44 p.m.
THE MINISTER OF STATE, DEPARTMENT OF HEALTH AND SOCIAL SECURITY (BARONESS SEROTM: My Lords, it will be obvious to the House that I could not have had the direct experience of the game of Rugby football that many of your Lordships clearly have. My own personal involvement has been secondhand in the sense that three times a week when my son was playing Rugby football for his school, I had to wash his Rugby kit. This did not prejudice me against the game; it gave me some idea of the enthusiasm that it engenders amongst men.
When I saw the terms of the Question of the noble Lord, Lord Ferrier, which he has put tonight, and which in fact has enlarged itself into a debate, it seemed to indicate that he was concerned primarily with the very limited issue of whether the authorities concerned with administering the race relations legislation in this country are sufficiently alive to their duties and responsibilities. However, as has been shown by the very wide variety of issues and questions that have been raised by those who have spoken since him in the debate, his Question is not really as simple as all that. The right reverend Prelate the Bishop of Chester—who unfortunately has had to leave us owing to another engagement, and who has asked me to apologise for his absence to the House—I thought

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spoke with courage and with clarity, stating the wider issues that were involved and which indeed lay behind Lord Ferrier's Question. The whole of the discussion we have had goes to show that the problems that have been raised by the Springboks' tour in this country, and the demonstrations that have happened in connection with it, involve issues which are really of the essence of our traditional procedures and our democratic system of government in this country.
The noble Lord, Lord Wade, has just reminded the House that he has a Motion down on the significance of demonstrations in a modern society. But it is not surprising that many of the points that have been raised to-night have been raised in relation to this issue, which is a matter of concern in some quarters at the moment, and was debated at some length during the passage of the Race Relations Act itself in 1965.
Several Members of the House have reminded us of the longstanding tradition in this country that persons with similar opinions, whatever one's view of those opinions, should have the right to organise themselves and put their opinions forward, provided they do not go beyond the limits that have been set by the law in the interests of the community as a whole. In spite of the call for troops from the noble Lord, Lord Brougham and Vaux, the rest of the House would I think agree that we would not wish to rush into any action which could result in paying the very high price indeed of the loss of our traditional freedoms in this country. It is regrettably true that some demonstrations can lead to violence, and several speakers have deprecated this, but this occurs far less often than is supposed. I hope that the House will keep these incidents in a sense of proportion.
I take the point made by the noble Lord, Lord Burton, when he seemed to suggest that perhaps certain incidents receive too much publicity. Perhaps certain facets of certain incidents get too much publicity. I think the noble Earl, Lord Ferrers, has basic objections to demonstrations, in that he himself has never felt moved to demonstrate; but there are several Members of your Lordships' House, and I certainly am one of
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them, who have joined in many demonstrations.
LORD AUCKLAND: Peaceful.
BARONESS SEROTA: And I have often been surprised when we have read or seen the accounts of them later in the Press. My Lords, it would surely be far too extreme a step for the Government to forbid all demonstrations, because only a minority give rise to violence. It would be equally invidious to take the view that certain demonstrations, because they might interfere with some activities which some of your Lordships hold dear, ought solely on that account to be prohibited. The noble Lord who put the Question was concerned with penalties for offences such as assaulting the police, possessing weapons, and about making good damage. I think the noble Lord knows that where a demonstration does become violent the police have adequate powers to deal with offenders, but with regard to the explicit subject of the Question, namely, the application of the race relations legislation—
LORD FERRIER: My Lords, if I may interrupt the noble Baroness, I did not say anything about making good damage. I mentioned that damage seems to have ensued from the violence.
BARONESS SEROTA: My Lords, I am sorry if I misunderstood the noble Lord. I thought he was making the general point, and my reply was that this comes generally within the terms of the law and is not dealt with, nor needs to be dealt with, within the context of our race relations legislation.
The noble Lord referred in some detail to Sections 6 and 7 of the Act, and quoted at considerable length from the speeches that were made on them during the passage of the Bill, particularly from the noble Lord, Lord Stonham, and the noble and learned Lord the Lord Chancellor. But as he told us—and I do not wish to requote the sections of the Act because the hour is late—if there is any allegation of an offence under Section 6, then it is for my right honourable friend the Attorney General to consider it in the light of the details of the particular case alleged. And whilst I am clearly not competent to make any authoritative statement on a question of law,

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especially in a Chamber such as this, which has so many distinguished and learned Members, I should have thought it very doubtfully arguable that the demonstrations have so obviously involved any offence of racial incitement under Section 6.
With regard to these demonstrations, I think that many of us see them as being not dissimilar from those which have been held in recent years against the Vietnam war. The intention of those demonstrations has been to seek an end to the war; and the intention of the current demonstrations against the Springbok tour, as many noble Lords have pointed out, is to put an end to the racial policies of the South African Government. I know that several of those who have spoken tonight deeply resent what they regard as the mixing up of politics with sport; but I think that they must equally understand that there are others, who are demonstrating to bring the Springbok tour to a close—that is their declared objective—because they believe that a team which is selected by a country on the principles of apartheid is the very anathema of all they believe in. The Government do not see that this is relevant to Section 6 of the 1965 Act, which deals with racial incitement against minority groups in this country. I would urge your Lordships to look at the Act and to understand that that is its purpose: namely, to take action
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against those who incite race hatred against minority groups in this country.
With regard to Section 7 of the Act, the other point raised by the noble Lord at the outset, its original purpose, as he said, was to substitute amended provisions for those originally enacted in Section 5 of the Public Order Act 1936, which make it an offence in any public place or at any public meeting for a person to use threatening or abusive language or insulting words and behaviour; and the fact is that, out of a total of 102 arrests at matches after the present Springbok tour, 61 arrests were for offences under Section 7. I submit to the House that the problems which arise in connection with these matches are not really problems of the kind to which the race relations legislation is really directed. Indeed, as my right honourable friend the Home Secretary said in another place on November 17, they are problems of public order and fall to be dealt with as such on precisely the same basis as any other such problems. I hope it is in that light that those noble Lords who are concerned with the general issue of demonstrations and the right to demonstrate freely in a democratic society will address their minds when they take part in the debate that the noble Lord, Lord Wade, is initiating on December 10.
House adjourned at five minutes before nine o'clock.