Sitting of 13 July 1971

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  LONDON TRANSPORT BILL
  Lords Amendments considered and agreed to.
  SURREY COUNTY COUNCIL BILL [Lords]
  Bill read the Third time and passed, with Amendments.
  CLYDE RIVER PURIFICATION BOARD BILL
  Bill read a Second time and committed.

  BRISTOL CORPORATION BILL [Lords] (By Order)
  Order for consideration, as amended, read.
  Bill, as amended, to be considered upon Thursday next.

ORAL ANSWERS TO QUESTIONS
  SOCIAL SERVICES

    Overseas Pensioners
    Sir G. Nabarroasked the Secretary of State for Social Services whether, having regard to complaints from pensioners living in Fiji, Canaries, Madeira, Malta, France, Italy and Australia, he will take steps to establish absolute parity for state pensions for all eligible British nationals irrespective of domicile ; what estimate he has made of the annual cost of such parity ; and if he will make a statement.
    The Under-Secretary of State for Health and Social Security (Mr. Paul Dean): Any person entitled to a British pension can receive it in any country at the rate current either when he left Britain or when he qualified while abroad. We think it right that subsequent increases should be paid only in countries which have agreed to do likewise for persons drawing their pensions here. Arrangements to this effect have been made in reciprocal agreements with 13 countries, including Malta, France and Italy. The additional annual cost of paying the proposed increased rates from September next to all persons drawing British pensions abroad is estimated at about £8 million.
    Sir G. Nabarro: Having regard to the relatively small sum involved, could not my hon. Friend pay some attention to the justice of this case? Is not inflation worldwide, often at a higher rate abroad than in this country? Have not these pensioners abroad qualified, by payments over the whole of their working lives, to become eligible? Why should domicile overseas negative what is their due right—to receive the full pension, with increases?
    Mr. Dean: I understand my hon. Friend's point. On the other hand, he will appreciate that the amount they have paid in contributions nothing like covers the cost of the pensions which they receive, and the increases must, of course, be met by the existing working population and taxpayers in this country.
    Sir G. Nabarro: On a point of order, Mr. Speaker. In view of that unsatisfactory reply, I beg to give notice that I shall raise this matter at the earliest possible moment on the Adjournment.

    National Health Service Charges
    Mr. Skinnerasked the Secretary of State for Social Services how many letters he has now received on the subject of increased charges for spectacles, &c. ; and what replies he has given.
    The Secretary of State for Social Services (Sir Keith Joseph): Up to 1st July, about 90 ; but a small number of letters on other subjects also mentioned optical charges. Replies have explained that the increased charges have shifted the burden of cost from the taxpayer to those users who can afford it, and have been accompanied by more liberal arrangements for helping people with limited means.
    Mr. Skinner: Is the right hon. Gentleman aware that one of the letters which he has received is from the Derbyshire Local Optical Committee which describes the imposition of these new charges as Mafia-like cuts on people who, through no fault of their own, have poor vision? As he subscribes to the policy that higher charges lead to greater individual care and attention, may I ask him to explain how people born with poor sight will have their problem solved?
    Sir K. Joseph: I do not think I have expressed a policy judgment such as the hon. Gentleman ascribes to me. I have said that this is an increase only for those who can afford it and that the exemptions have been increased sharply.
    Mr. Scott-Hopkins: Does my right hon. Friend feel that the number of spectacles dispensed will diminish as a result of these charges?
    Sir K. Joseph: It is difficult to be sure of future trends. General experience is that there is a fall after an increase in charges followed shortly by a resumption of the normal trend ; and that I expect to happen in this case.
    Mr. Bob Brown: Does the right hon. Gentleman still hold to the point of view he expressed some months ago from the Government Front Bench, that increased
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    charges for dental treatment are an incentive to people to take care of their teeth?
    Sir K. Joseph: That is a different question on which there is a later Question.
    Mr. Frank Allaunasked the Secretary of State for Social Services why he is reducing the age limit for exemption from dental charges, except for dentures, from 21 years of age to 18 years of age ; when he proposes to introduce legislation ; and what representations he has received on the matter.
    Sir K. Joseph: In the absence of compelling clinical reasons for retaining the present age limit, I propose to bring it into line with the current age of majority. This has been explained in reply to representations I have received from a number of individuals and bodies. I cannot yet say when the necessary legislation will be introduced.
    Mr. Allaun: Is it not an anomaly that if one breaks a leg or has appendicitis one receives free treatment but if one breaks a tooth or has a tooth infection one has to pay half the cost of the treatment? Are not dentists saying that, far from the age being reduced from 21, it should be raised to 25, because otherwise it will discourage regular dental treatment?
    Sir K. Joseph: Both parties have thought it made sense to ask about half the population—
    Mr. Orme: Both Front Benches.
    Sir K. Joseph: —that is, the adults, to pay something towards their dental treatment. Subject to legislation, I am proposing to reduce the exemption age, because there seems to be no clinical reason for keeping it at 21 as opposed to 18.
    Sir G. Nabarro: Does my right hon. Friend recall that it is now six months since he promised me that he would step along the corridor to see the Chancellor of the Exchequer and demand an abolition of the purchase tax on toothpaste in order to encourage children to clean their teeth properly? Has he noted that this was omitted from the last Budget? Will he now double along the corridor to get something done?
    Sir K. Joseph: My right hon. and learned Friend and I do not behave in that way in demanding things of each other.
    Sir G. Nabarro: I wish you would.
    Sir K. Joseph: Children are, have been and will be exempted from dental charges.
    Dr. Summerskill: Is there not a clinical reason for needing more dental treatment between the ages of 21 and 18 than later in life? It is not a question of the age of majority but a question of dental fact. As dentists have strongly deplored this proposed legislation, should not the Government forthwith abandon it?
    Sir K. Joseph: I will read with interest any evidence that the hon. Lady cares to send me to justify her assertion.

    Supplementary Benefit (Strikers' and Prisoners' Dependants)
    Mr. Ashtonasked the Secretary of State for Social Services what is the total amount of social security benefits paid to dependants of strikers in 1970–71 ; and how this compares with benefits paid to dependants of men in prison.
    Mr. Dean: Supplementary benefit payments during trade disputes to the dependants of persons disqualified on account of the dispute for receiving benefit for themselves totalled £4,882,284 in the 12 months ending 23rd March, 1971. I regret that details of payments to dependants of persons in custody are not kept.
    Mr. Ashton: Since the Minister cut benefits to strikers' families, do we not now have a situation in which if a man goes to prison for doing something highly illegal, his family is likely to get more benefit than the family of a man on strike, who is doing something legal? Is not this total discrimination against people taking part in industrial disputes? Should not the benefits to strikers' families be level at least with those of the family of a man who is in prison?
    Mr. Dean: No, sir. In the case of prisoners, their wives are treated like other women who are on their own. In the case of strikers this is a voluntary act on the part of the individual concerned.
    Mr. Bruce-Gardyne: Is it not utter nonsense to make a comparison between the position of those who are deprived of the ability to earn their living by the community and the position of those who voluntarily decide to withdraw their labour from employment, usually for material gain to themselves?
    Hon. Members: Oh !
    Mr. Dean: I am obliged to my hon. Friend. What is being said from the other side of the House is that we should change what has been the traditional system in this country for many years ; namely, that public funds should not be used for strikers themselves.

    Supplementary Benefit (Separated Wives)
    Mr. Leadbitterasked the Secretary of State for Social Services how many separated wives are drawing social security allowances ; what is the total value ; and what proportion this represents of uncollected maintenance orders.
    Mr. Dean: I assume the hon. Member's Question is directed to payments of supplementary benefit. From the latest information available it is estimated that in 1970 supplementary benefit amounting to about £53 million was paid to about 129,000 separated wives where it was necessary to pursue a question of liability to maintain. It is not possible to make a reliable estimate of how much of this was in respect of unpaid maintenance orders.
    Mr. Leadbitter: Will the Under-Secretary recognise that these figures are very serious? He will recall my representations to him and those of the members of the Hartlepools Lone Parents Association. Will he now accept that this is a very serious problem involving severe hardship, suffering and, in far too many cases, very serious mental illness? In those circumstances, will he seek to introduce legislation to bring about some social justice in this area?
    Mr. Dean: I accept that this is a serious problem. The hon. Gentleman will remember the meeting which we had some time ago. Only today I have written to the chairman to give her a progress report. The House knows that the machinery for enforcement is being speeded up and improved to try to ensure continuity of

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    payment and that the Government are taking other measures, and, in addition to that, this whole problem is within the remit of the Finer Committee.
    Sir B. Rhys Williams: Is my hon. Friend considering the possibility of enforcing payment of maintenance allowances by making use of the Pay-As-You-Earn system?
    Mr. Dean: My hon. Friend knows that that is not a matter for me, but I understand that there are considerable difficulties in such suggestions.
    Mrs. Shirley Williams: As these families constitute one of the most impoverished groups in the community, would the Minister consider placing on the Supplementary Benefits Commission a responsibility for pursuing orders for maintenance and the attachment of earnings, because many wives are quite incapable of doing this for themselves?
    Mr. Dean: I am grateful to the hon. Lady for that suggestion, which I will certainly pursue. I remind the House that women who are getting their payments made by the Supplementary Benefits Commission are not themselves suffering because they are getting regular payments week by week.

    Family Income Supplement
    Mr. Meacherasked the Secretary of State for Social Services what is the latest figure for the total number of successful claims for the family income supplement.
    Mr. Marksasked the Secretary of State for Social Services how many applications for family income supplement have so far been received ; how many approved ; and what is the estimated payment on those so far approved.
    Mr. Dalyellasked the Secretary of State for Social Services if he will give the total number of successful claims since the family income supplement was introduced.
    Sir K. Joseph: By 6th July 43,792 claims for family income supplements had been received : of the decisions so far given 16,844 were favourable and 17,517 unfavourable. It is estimated that the average award is in the region of £1·50 a week.
    Mr. Heffer: Swindle !
    Mr. Meacher: Will the right hon. Gentleman confirm that, despite a massive advertising campaign costing more than one third of a million pounds, the total take-up of this benefit, with only three weeks to go to the first day of receipt, is still only 10 per cent. of those eligible, which is ridiculously far short of the right hon. Gentleman's declared objective of 85 per cent. and since this illustrious showpiece of Tory social policy—
    Mr. Speaker: Order. The hon. Member must not make a speech.
    Mr. Meacher: In view of the apparent failure of this policy, will the right hon. Gentleman state what alternative plans he have to remedy family poverty, on which so far he has made very little impact?
    Sir K. Joseph: The hon. Gentleman gives the impression that he does not want the extra money to be received by the poorest families.
    Mr. William Price: That is untrue.
    Sir K. Joseph: That is the impression that the hon. Gentleman gives, and that is true. The amount of money devoted to the advertising campaign has been £60,000, and not a quarter of a million pounds. My objective to obtain a very high take-up remains. Hon. Gentlemen will judge by the developing result over the rest of the year, and I hope that the whole House hopes with me that we shall have success.
    Mr. Marks: Is this figure higher or lower than the right hon. Gentleman anticipated at this stage? Would it not have been far better to increase family allowances, as the Conservative Party promised in its election manifesto?
    Sir K. Joseph: No proposal to increase family allowances that would be practical politics would put in the hands of those families, especially those with only one child, a sum as big as £1.50 a week on average. As for the first part of the question, I confess that I had hoped that the take-up at this stage would be bigger. But my experienced advisers warned me that the take-up of a brand-new benefit would tend to be slow, particularly in the period before any money had been distributed.
    Mr. Dalyell: On what general grounds were the 17,517 declared unfavourable? This seems to be fairly important.
    Sir K. Joseph: The question is a very good one. For two-thirds it was because their income exceeded the test limit, and for one-third it was because they were not in what has been defined as full-time work.
    Mr. O'Malley: Why did the Secretary of State not explain to the House when the Bill was going through that his advisers were saying that the take-up would be low?
    Sir K. Joseph: Slow.
    Mr. O'Malley: Either slow or low. Does not this scheme demonstrate once again the undesirability of a massive increase in means-tested benefits that the Government are proposing? Is not the present scheme little but a fraud? Will the Secretary of State confer with the Under-Secretary and ask him to admit that his estimates of an 80 per cent. take-up at the time the Bill went through were absolutely wrong?
    Sir K. Joseph: No. My advisers thought that the take-up of a new benefit would be slow, not low. I ask the House to be patient over the next few months and see how this develops. It is very important that we should get this extra money into the hands of the poorest working households. I hope that the whole House will agree with that.
    Mr. Orme: The Secretary of State referred to the question of the family with one child. How many such families have qualified under this scheme? Does he recall, as the House will recall, that the late Iain Macleod gave a firm commitment from the Opposition Front Bench that, irrespective of political unpopularity, a future Tory Government would go for an increase in family allowance? Why have the Government rejected that?
    Sir K. Joseph: If the hon. Gentleman would care to table a Question, I will certainly give the House details of the distribution between families with one child and those with more than one child. I have already explained that an examination that we conducted when we assumed office revealed that a family allowance increase would have put less
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    money into the hands of the very poorest working families and no money into the hands of the family with one child for a vast increase in public expenditure and a great transfer of money from husbands to wives.

    Invalidity Benefit
    Mr. Ashleyasked the Secretary of State for Social Services what is his latest estimate of the proportion of those entitled to invalidity benefit who will be no better off because of an equivalent reduction in their supplementary benefit.
    Mr. Dean: It is not possible to give a precise estimate, but it is thought that the proportion who will not benefit from the invalidity allowance because their supplementary benefit will be reduced by an equivalent amount will probably be about one-third.
    Mr. Ashley: Is the Minister aware that he is saving six lousy million pounds at the expense of 100,000 people who are not only sick and disabled but actually living on the poverty line? Is his right hon. Friend aware, not only that he should have answered this Question, but that £6 million, which is almost chicken feed to surtax payers, is vitally needed by sick and disabled people ; and is he prepared to reconsider his priorities?
    Mr. Dean: The hon. Gentleman is being a little unfair. I think the whole House recognises that a substantial step forward is being taken to help the chronic sick and the disabled this Session. My right hon. Friend has given an assurance that the next step is now being considered, and one of the aspects of that is to consider in what way the arrangements for those on supplementary benefit can be improved.

    Retirement Pension
    Mr. George Cunninghamasked the Secretary of State for Social Services what retirement pension is payable to a person with an average of 29 contributions per year ; by how much this falls short of 29/50th of the full pension ; and what were the equivalent figures in July, 1949.
    Mr. Dean: £2·50, which is 40p less than 29/50ths of the standard rate. In July, 1949, the figures were 65p and 10½p.
    Mr. Cunningham: Does the Under-Secretary think that it is fair that people

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    receiving an already-reduced pension rate should in many cases receive less than they are entitled to on a strictly proportional basis? Does he accept that the differential, as it has of necessity risen since 1949 with the rise in pensions, now needs looking at in this respect with a view to providing an exactly proportional increase, acknowledging that that might mean in some cases a slight reduction?
    Mr. Dean: I understand the hon. Gentleman's point, but, on the other hand, there are already 12 rates of benefit and, were we to have a precise proportion, it would involve about 40 different rates, which would mean a very substantial administrative cost.
    Mr. Harold Walkerasked the Secretary of State for Social Services what increases would now be needed to restore the purchasing power of the standard retirement pensions to the level at which they stood in November, 1969, immediately after the last increase.
    Sir K. Joseph: As measured by the General Index of retail prices between November, 1969 and May, 1971, the single retirement pension rate would need to be increased by 74p to restore the November 1969 rate of purchasing power. The corresponding amount for a married couple is £1·20.
    Mr. Walker: Is not it obvious from that reply that the Government have achieved a cut in pensions at a stroke? Is it not clear that the pledged £1 pension increase for the autumn has already been pre-empted? How will pensioners fare in the subsequent two years if the right hon. Gentleman does not take immediate interim steps to prevent their standard of living being further slashed by the Government?
    Sir K. Joseph: We are confident that there will be small but useful real increases and additional increases for the very old and the chronic sick.
    Mrs. Shirley Williams: Does the right hon. Gentleman recognise that what was first decreed to be the largest increase in pensions ever has now become a small but useful increase? Will he consider introducing an annual review in the present state of inflation, which is having such a terrible effect on pensioners?
    Sir K. Joseph: We do not for a moment expect that the present rate of inflation will continue. The Opposition proposed to put into statutory form an obligation to have a two-year review of pensions.
    Dame Irene Ward: Will my right hon. Friend accept my statement : thank God that he is in office and not the Opposition?
    Mrs. Renée Short: In view of the undertaking in the White Paper on entry into the Common Market to protect the pensioners and others against the undoubted increase in the cost of living if we do go in, can the right hon. Gentleman say how much thought has been given to estimating what that will cost in due course?
    Sir K. Joseph: No, Sir. The White Paper says that there would normally be a review due in 1973, and that we shall, of course, take any possible increase due to the Common Market into account.

    Unemployment Benefit (Industrial Disputes)
    Mr. Bidwellasked the Secretary of State for Social Services if he is satisfied with the working of the National Insurance Act, 1965, in so far as it relates to procedure to determine the payment of unemployment benefit arising from industrial disputes ; and if he will make a statement.
    Sir K. Joseph: Yes, Sir : I consider the procedures normally work satisfactorily.
    Mr. Bidwell: Will the right hon. Gentleman undertake to confer with the Secretary of State for Employment, with whom I have had correspondence concerning a stoppage of work at the A.E.C. factory at Southall in a single workshop which resulted in lay-off of a much larger number of workers who have not yet had their cases heard, in spite of the fact that this was at the end of April, because of the cumbersome machinery? Does not this challenge the Tory concept of individual liberty and freedom? These workers are all entitled to have their cases heard singly. If that be so under the 1965 Act, it will take a considerable time under the present machinery.
    Sir K. Joseph: Yes. The normal way to make the machinery less cumbersome is by a test case in agreement with the trade unions. On this occasion the trade union did not co-operate with that machinery.

    Electrically-Assisted Pushchairs
    Mr. Farrasked the Secretary of State for Social Services if he will make fresh arrangements for the supply of electrically-assisted pushchairs to disabled persons in need.
    The Under-Secretary of State for Health and Social Security (Mr. Michael Alison): No, Sir. The initial difficulties have been overcome and the arrangements are now satisfactory.
    Mr. Farr: Is my right hon. Friend aware that there is a lot that needs looking at in this problem? First, outdoor electrically - operated patient - controlled chairs are not available under the National Health Service. Second, there has been a considerable hold-up in the supply of indoor electrically-assisted pushchairs. Will my right hon. Friend inquire into this matter, because many people have been waiting for many months due to supply hold-ups?
    Mr. Alison: The first part of my hon. Friend's supplementary question is a separate question from the Question on the Order Paper. As to the second part, I admit that there were difficulties, particularly supply difficulties, but we believe that these have now been overcome and that the supply position has been improved.
    Mr. Alfred Morris: Is the Secretary of State aware that the supply difficulties cause very serious inconvenience to many severely disabled people? What progress is being made now in giving severely disabled people powered wheelchairs that can be used on the pavement, as envisaged in Section 20 of the Chronically Sick and Disabled Persons Act?
    Mr. Alison: I readily concede that some inconvenience and difficulty were cause by the component hold-ups, which were due to matters beyond the control of any of those concerned. The second part of the hon. Gentleman's question is a separate matter. If he would care
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    to table a Question specifically on that point I should be happy to answer it.

    Consultant Gynaecologists
    Mrs. Renée Shortasked the Secretary of State for Social Services if he is satisfied wih the number of consultant gynaecologists in posts in each regional hospital board ; and if he will make a statement.
    Sir K. Joseph: It is for individual boards to consider how many consultants are necessary in any specialty, in the light of local needs and facilities, but I have already informed boards that more rapid expansion of the consultant grade as a whole is necessary : they will take account of the particular needs in this specialty where there are long waiting lists, and I have advised them that there should be no shortage of candidates for consultant posts in obstetrics and gynaecology.
    Mrs. Short: I thank the right hon. Gentleman for that reply. If he will look at the figures that he was good enough to give me in a Written Answer not long ago he will see that in some regions there are only six or seven consultant gynaecologists per million of population. Those are the areas where the ratio is worst. To get continuity all over the country, is it not necessary to improve this ratio and bring it into line with the better areas where the ratio is about nine per million?
    Sir K. Joseph: Yes ; the facts are as the hon. Lady has stated them, and I am sure that boards, in response to the information which I have given them, are taking these into account.
    Dr. Summerskill: How many of these consultant posts are now vacant, and what steps is the Secretary of State taking to fill them?
    Sir K. Joseph: I cannot tell the hon. Lady that now, but I should be glad to give that information in answer to a specific Question. I am discussing with the profession arrangements for joint forward planning of consultant medical staffing with a view to remedying disparities between different regions and different specialties.

    Scientology (Foster Report)
    Mr. John Hallasked the Secretary of State for Social Services when he

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    expects to decide whether to publish the Foster Report on Scientology.
    Sir K. Joseph: I have not yet completed my consideration of the report.
    Mr. Hall: What special considerations are making it difficult for my right hon. Friend to announce a decision? As it is nearly 18 months since the committee was set up, should not the general public as well as the scientologists themselves know whether there is any justification for the criticisms and accusations that have been made against the scientologists?
    Sir K. Joseph: It was not a committee that was set up. My predecessor took the relatively unusual step of appointing one man, a very distinguished hon. and learned Friend of myself and my hon. Friend—the Member for Northwich (Sir J. Foster)—and the result is a lengthy document which I must have time to consider.
    Mr. William Price: Will the Secretary of State give an assurance that he will not take as long to make up his mind about publishing the report as the hon. and learned Member for Northwich (Sir J. Foster) did to prepare it without ever having called any oral evidence? Is it not strange that four years after the Ministerial allegations were made against this group of people, whatever the rights or wrongs of it they still to this day do not know the allegations made against them?
    Sir K. Joseph: It is for a number of considerations, including some of those, that I think I am right to take time to consider the report.

    Pathologists (Lung Disease Postmortems)
    Mr. Eadieasked the Secretary of State for Social Services what progress he has made in his production of advice to pathologists concerning their procedure when undertaking postmortems where lung disease is suspected.
    Mr. Dean: My right hon. Friend has no direct responsibility for advising pathologists on the conduct of postmortem examinations. As regards the industrial lung disease pneumoconiosis, I understand that the Association of Clinical Pathologists has advised its members of the advantages of perfusing lungs in which the presence of this disease is suspected.
    Mr. Eadie: I thank the hon. Gentleman for his reply, but he gave a specific undertaking during the Committee stage of a Private Member's Bill, and I hope he is not going back on it. Is he aware that we are rather concerned, particularly in the mining industry, that far too much illness is being caused by chest diseases, some of them diagnosed and some not? Is it not a rather sad comment that some of the people who are suffering from diseases not diagnosed are wondering whether, if they die, there will be proper pathological investigation to determine precisely the nature of their disease and whether it would make their cases eligible for industrial injury benefit?
    Mr. Dean: I am glad that the hon. Gentleman has asked this Question because it may help to give publicity to the answer which I have been able to give. I assure the hon. Gentleman and the House that there is no question of the Government going back on what I said in Committee. The Advisory Council is considering this whole matter at present, but it is a complicated subject and it will inevitably take time.

    Retirement Pensioners (Free Prescriptions)
    Mr. Scott-Hopkinsasked the Secretary of State for Social Services whether he will take steps to lower the age for free prescriptions for retirement pensioners from 65 to 60 years of age.
    Mr. Alison: No, Sir. The existing arrangements already ensure that help can be given where it is needed.
    Mr. Scott-Hopkins: That is not really a satisfactory reply. Does not my hon. Friend realise that many women between the ages of 60 and 65 have special need for prescriptions but they are outside the scope of the answer which he has given? Will he, therefore, look at the matter again and see whether the age could be reduced to 60, in particular for women?
    Mr. Alison: There is no evidence that women or men between the ages of 60 and 65 have a special requirement for extra medicine arising simply from that age range. Where income difficulties arise, there are exemption provisions.
    Mr. Molloy: But will not the hon. Gentleman acknowledge that his reply will be most disappointing to many people

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    between 60 and 65 years of age? As successive Governments have invaded the fundamental principle of a free National Health Service, will he not accept that all the labour and administrative paraphernalia involved in charging for prescriptions makes it not worth the candle, and the quicker we get back to the basic principle of a free National Health Service the better it will be for everyone?
    Mr. Alison: I note what the hon. Gentleman says. The age exemption provisions are generous, and we cannot overlook the substantial savings which accrue for other benefits in the National Health Service which arise from this source.

    Adoption of Children
    Mr. Peter Archerasked the Secretary of State for Social Services if, pending the final proposals of the Departmental Committee on Adoption, he will encourage local authorities to make more use of their present powers under Section 2 of the Children Act, 1948.
    Mr. Alison: I am not clear how Section 2 could appropriately be used more widely in these distressing situations. I am sure that the right course is to await the Departmental Committee's final proposals.
    Mr. Archer: I appreciate the argument for awaiting the Departmental Committee's report before introducing amending legislation, but does not the hon. Gentleman realise that heartbreak could be ameliorated in many cases if local authorities were a little more robust in assuming parental powers, and will he not give them just a little encouragement?
    Mr. Alison: I admit that there is a genuine difference of opinion on whether the powers are adequate. But I take the hon. and learned Gentleman's point that a more robust use of existing powers by local authorities might solve a lot of the problems which we face.

    Elderly People, Newcastle-upon-Tyne (Supplementary Benefits)
    Mr. Bob Brownasked the Secretary of State for Social Services what investigations he undertook in order to satisfy himself that there are no elderly people in Newcastle-upon-Tyne eligible
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    for supplementary benefits who are not receiving them.
    Mr. Dean: No investigations have been undertaken for this purpose. Continuous efforts are made to ensure that elderly people throughout the country receive the supplementary pensions to which they are entitled.
    Mr. Brown: That is an extremely disappointing reply. The Secretary of State is reported in the Newcastle Evening Chronicle as having publicly said in the city that he was satisfied that there were no old people in Newcastle who needed supplementary benefit and who were not receiving it. Is the hon. Gentleman aware that all thinking people in Newcastle-upon-Tyne, including the principal officer for social services, regard that as a lot of codswallop, and will he prevail upon his right hon. Friend to do much more than he is doing now to persuade elderly people that there is no stigma in seeking supplementary benefit and that it is theirs as of right?
    Mr. Dean: I am sure that my right hon. Friend did not say that, because no right hon. or hon. Member is keener than he is to see that those who are entitled to benefits receive them.

    Family Planning Association Conference
    Mr. Huntasked the Secretary of State for Social Services whether his Department is to be represented at the National Conference of the Family Planning Association to be held at the Royal Festival Hall from 20th to 22nd July on the rôle of family limitation, responsible parenthood and sex education.
    Sir K. Joseph: Yes, Sir. Members of my Department will be present ; my chief medical officer will be participating ; and I shall address the conference myself.
    Mr. Hunt: I warmly welcome my right hon. Friend's support for this conference, but is he aware that there has been a somewhat disappointing response from a number of local health authorities and hospital management committees, and will he agree that it is most desirable that public bodies such as these should identify themselves with the important work and aims of this conference?
    Sir K. Joseph: I was not aware of a disappointing response. I hope that local authorities and hospital authorities are busily carrying out the enlarged programme which the Government are helping them to put into practice.

    Ambulance Accidents (Compensation to Patients)
    Mr. Wallaceasked the Secretary of State for Social Services under what circumstances are National Health Service patients entitled to compensation for injury or death arising from the public service ambulance in which they were conveyed being involved in a road crash.
    Mr. Alison: This would be a matter for the local authority concerned in the particular case or for the court if legal action were taken. I understand that it is normally the practice of local authorities to insure against claims in respect of injury to or death of ambulance passengers.
    Mr. Wallace: Is the hon. Gentleman aware that if an ambulance driver who collapsed and thereby caused a crash was suspected of suffering some heart trouble, and the coroner's verdict so indicated, the individuals injured or the relatives of persons killed in such an accident would have extreme difficulty in obtaining compensation?
    Mr. Alison: Normally, the insurance arrangements which ambulance authorities make would cover such a case, but I shall study the particular contingency which the hon. Gentleman has specified.

    Rubber and Plastic Foam (Fire Risk)
    Mr. Alec Jonesasked the Secretary of State for Social Services whether he will issue guidance to health authorities over the use of furniture containing rubber or plastic foam in view of their potential fire risk.
    Mr. Alison: We are continuing investigation of this question, and health authorities will be kept informed of developments.
    Mr. Jones: Does not the hon. Gentleman understand that there is evidence to suggest that fires involving the use of
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    these foam and rubber compounds, present serious smoke and fume hazards, and that such smoke and fume present in considerable volume in a hospital fire could well prevent the escape of patients?
    Mr. Alison: I am grateful to the hon. Gentleman for writing to us in detail about this matter and for the concern which he shows. We have a problem here in combining in comfortable material, which is essential for hospital patients, the qualities of flame resistance. We are trying to develop a fabric for mattress covers which will be more flame-resistant. We are pressing ahead with developments as rapidly as possible. There is a balance of advantage in both directions here to be considered.

    Single Homeless Persons
    Mr. O'Halloranasked the Secretary of State for Social Services when he expects to announce a decision on the working party dealing with single homeless persons ; and if he will make a statement.
    Mr. Dean: I am not yet able to forecast a date.
    Mr. O'Halloran: Will the hon. Gentleman bear in mind the great work which is being done by the Simon and St. Mungo Communities and, perhaps, give them some financial assistance?
    Mr. Dean: I am grateful to the hon. Gentleman for mentioning those two voluntary organisations ; there are others working in this field which do excellent work. We are anxious to help them in every way we can with financial and other assistance, and that is one of the ways in which we are tackling this serious problem.
    Mr. Alfred Morris: Can the hon. Gentleman say how the total number of hostel places compares with the total number of single homeless people today?
    Mr. Dean: The number of lodging houses is tending to decline owing to redevelopment schemes, and one of the projects which the Government have in hand now, in co-operation with voluntary bodies, is a survey of these places to see how many there are and how many more are needed.

    Shotley Bridge General Hospital, Consett (Accident Department)
    Mr. David Watkinsasked the Secretary of State for Social Services if he is aware that the accident department at Shotley Bridge General Hospital, Consett, has had to be partially closed because of shortage of medical staff, thereby depriving the area of a vital service during certain periods ; and what measures he proposes to restore a full accident service.
    Mr. Alison: I am aware of the partial closure. The management committee is seeking to recruit more staff, but the difficulty of staffing accident and emergency departments is a general problem which my Department is currently discussing with the medical profession.
    Mr. Watkins: I thank the hon. Gentleman for that reply. I can confirm the local efforts to which he has referred. Is he aware that it is an area of round-the-clock working in heavy industry, such as steel-making and coal-mining, where accidents are only too tragically likely to occur? Does he therefore realise the seriousness of that deprivation, and will he take urgent measures to seek to remedy it?
    Mr. Alison: The hospital management committee expects to appoint a locum senior house officer, which should improve the service, as from 1st August.

    Over-70 Employees (National Insurance Contribution)
    Mr. Liptonasked the Secretary of State for Social Services what weekly national insurance contribution is payable by a male employee over 70 years of age and his employer ; to what funds are such contributions' credited ; and what benefits accrue to the employee.
    Mr. Dean: As the reply contains a number of figures, I will, if I may, circulate them in the OFFICIAL REPORT.
    Mr. Lipton: The reply does not contain such a large number of figures that the answer cannot be given now. Is not it a fact that a large sum is paid out in such cases for which there is no substantial return to the employee concerned, and that this deters employers from employing such people?
    Mr. Dean: The employee in this case pays only 4p for the industrial injury scheme, which gives him cover whatever his age—even the 70-year old.
    Following is the information :
    A male employee over 70 pays £0·04 and his employer £2·15. The employee's contribution goes to the Industrial Injuries Fund and of the employer's contribution £0·754 is credited to the National Insurance Fund, £0·05 to the Industrial Injuries Fund, £0·083 towards the National Health Service, £0·063 to the Redundancy Fund and £1·20 is Selective Employment Tax. The employee normally draws retirement pension and may qualify for benefit under the Industrial Injuries Act for an accident at work ; and he also, of course, comes within the National Health Service, though this does not accrue from the payment of contributions.

    Walsall General Hospital (Children's Admissions)
    Mr. William Wellsasked the Secretary of State for Social Services what is the average delay in admitting children for surgical treatment, other than in emergency, at the Walsall General Hospital ; and how this period compares with the average in the area of the West Midlands Regional Hospital Board as a whole.
    Mr. Alison: This information is not available since separate waiting lists are not maintained for children.
    Mr. Wells: Does the Minister realise that for the gynaecological services the delay in Walsall is double that in the rest of the area of the regional hospital board? Will he make further inquiries to find out whether the delay to children is the same? Will he do all in his power to bring the Walsall standard at least up to the standard of the rest of the region?
    Mr. Alison: I note the hon. and learned Gentleman's point. I understand that at the Walsall General Hospital last December 643 patients of all ages were awaiting admission for general and orthopaedic surgery, a decrease of 66 on the figure for 1969.

    Construction Industry (Self-Employed Persons)
    Mr. Costainasked the Secretary of State for Social Services what progress he has made in his review of possible reclassification for national insurance purposes of self-employed persons in the construction industry ; and whether he will

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    give an assurance that he will consult fully with the industry on this matter.
    Mr. Dean: Officers of my Department have met representatives of the C.B.I. and employers in the industry and of the T.U.C. Consultations are continuing.
    Mr. Costain: My hon. Friend's action is fully accepted by the industry. Will he continue his negotiations?
    Mr. Dean: I am much obliged to my hon. Friend, and I gladly give him that assurance.

  RHODESIA
  Sir G. Nabarroasked the Prime Minister whether he will arrange an official meeting with Mr. Ian Smith shortly, having regard to the Goodman consultations.
  The Prime Minister (Mr. Edward Heath): I have no plans to do so.
  Sir G. Nabarro: Does my right hon. Friend recognise that yesterday's answer by my right hon. Friend the Foreign and Commonwealth Secretary was stodgy and indigestible? As the policy of sanctions is now seen to be a total failure, will not my right hon. Friend consider holding out an olive branch by at least withdrawing naval patrols that serve no further useful purpose?
  The Prime Minister: No, Sir. I cannot accede to my hon. Friend's request. My right hon. Friend repeated yesterday that the discussions have been going on to find out whether it is possible to reach a basis for negotiation. I am sure that that is the right way of dealing with this difficult problem. At the same time, the existing measures will remain in force.
  Mr. Harold Wilson: The right hon. Gentleman will have seen or read the script of Mr. Ian Smith's broadcast on "Panorama" last night, and will form his own views on the immediate prospects. Will he consider a proposal which he put to me when our rôles were reversed, and which received a favourable answer, that if there were any substantial change in the Rhodesian situation during the Summer Recess Parliament would be recalled? Will he give the same assurance to me as I then gave to him?
  The Prime Minister: Of course, I would consider that. If there were any major change in the Rhodesian situation, I would give the right hon. Gentleman the same reply as he gave me. I have read the script of last night's programme, but I do not propose to comment on it. It is better for us to rely on the discussions which have been taking place.
  Mr. Wilson: I agree with the Prime Minister's last remarks, but, just to clear up any doubt, since he said that he would consider such a situation and then said that he would give me the same reply as I gave him, and since that reply was that Parliament would be recalled, can I interpret the last part of his answer as meaning that if there is a substantial change in the Rhodesian situation Parliament will be recalled, and that its recall will not merely be considered?
  The Prime Minister: Yes, Sir. As the right hon. Gentleman has always said, the exact nature of the change, if any were to come about, would be a proper subject for discussions between him and me in the usual way as to whether Parliament should be recalled. Obviously, if there were any major change Parliament would have to be recalled.
  Mr. Thorpe: Contrary to the view of the hon. Member for Worcestershire, South (Sir G. Nabarro), is the Prime Minister aware that in referring to the five principles the Foreign and Commonwealth Secretary made it quite plain—and this carries a degree of support throughout the House—that in his view principles mean principles?
  The Prime Minister: Yes, Sir, and in the script I read of Mr. Smith's television appearance last night he himself said that the five principles were a matter of principle for the present British Government.

  EUROPEAN ECONOMIC COMMUNITY
  Mr. Skinnerasked the Prime Minister whether, following the Luxembourg Agreement, he will seek a further meeting with President Pompidou.
  The Prime Minister: I have at present no plans for a further meeting with President Pompidou.
  Mr. Skinner: Is the Prime Minister aware that if he does go to see his French master again he could take advantage of a tutorial? He could also take his latest essay, Cmnd. 4715. I am sure that President Pompidou would give it top marks for its abstract generalisations. Perhaps the right hon. Gentleman will first tell the British people why regional policy is dismissed in six sentences in the White Paper, and, more important still, what will be the real cost to the balance of payments.
  The Prime Minister: Regional policy does not exist in a Community form in the Community. Therefore, individual countries follow their own regional policy. The Commission is only at the earliest stages of formulating a regional policy. If any progress is made before the end of the negotiations, we can discuss it in the negotiations, and after that it can be discussed under the general arrangements for consultation during the interim period before the transitional period begins. As I have already told the House, we do not discriminate against other countries in the implementation of our own arrangements for regional policy. Any firm from another country which wants to come to a special development area or a development area receives exactly the same treatment and inducements as a British firm. Therefore, the policy is not against the principles of the Community.
  Mr. Gardner: Could my right hon. Friend, from all his experience of past meetings with representatives of the Common Market countries, tell this House—because it would be of great assistance, no doubt, for the forthcoming debate—whether he has met anyone from any one of the Six countries who has expressed regret that his country joined the Common Market, or anyone who has expressed a wish that his country should apply to leave it?
  The Prime Minister: I would obviously begin by making the stipulation that the number of people that any one person, Minister or otherwise, can meet is limited. But my experience, and that of many other right hon. and hon. Gentlemen, is that I have not met any organised body or member of a political party opposed to his own country's membership of the E.E.C. Indeed, one of the notable things
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  is that even the Communist parties in Europe have been notably reluctant to criticise their countries' membership of the E.E.C.
  Mr. Heffer: May I come back to the question of regional policy? Is the Prime Minister aware that a proposal is being made by the Commission suggesting that in a broad central belt investment schemes should be abolished and replaced by investment grants but with a ceiling of 20 per cent? Is the right hon. Gentleman aware that for areas like Merseyside and the North-East coast, which could well be included in that broad belt, such a system would be disastrous from the point of view of development?
  The Prime Minister: I have already told the House that the Commission is in the early stages of formulating a policy It has not yet come to the Council of Ministers. I have explained the arrangements under which we would be able to influence that policy if Parliament agreed that we should join the E.E.C. The objective of the E.E.C. in this matter seems reasonable, because it is the same objective as we have through our export credits guarantee scheme. It is to stop individual countries trying to outbid each other for investment. That would be to our advantage in the same way as the general arrangement for export credits, since we have created greater attractions for firms to invest in this country, and I do not see why we should have our arrangements outbid by other members of the Community.
  Mr. Roy Jenkins: While I accept that the policy is at the very early stage of formulation, may I ask whether it would not be unacceptable to many people if it were to prevent the North-East coast and Merseyside being assisted in a way that is desirable? Will the right hon. Gentleman assure us that if at the end of the day it appears that the investment policy of the Labour Government towards the development areas is more acceptable in Brussels than that of the Conservative Government, he will not be inhibited by any party dogma from producing the most effective policy from the point of view of the development areas?
  The Prime Minister: The right hon. Gentleman has, naturally, got more

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  speedily to the point than his hon. Friend. I could not understand why the hon. Member for Liverpool, Walton (Mr. Heffer) was complaining about the E.E.C. proposing a system of cash grants for investment. If we felt that it was in the interests of the Community, that it was an acceptable arrangement, no doubt we would express our agreement. It is obviously far too early to discuss individual areas with the Community, for the simple reason that the Commission and the Council of Ministers have not yet reached a policy. So far as we are concerned, obviously the areas mentioned by the right hon. Gentleman and also Scotland and Wales are of vital importance to us.
  Mr. Leadbitterasked the Prime Minister if the statement made by the Minister of Agriculture, Fisheries and Food on the television programme, Farming Outlook, on 27th June, 1971, referring to price increases in steps to meet European Economic Community levels, represents the policy of Her Majesty's Government.
  The Prime Minister: Yes, Sir.
  Mr. Leadbitter: Does the Prime Minister know that the answer to Question No. 34, put to the Secretary of State for Social Services earlier today by my hon. Friend the Member for Don-caster (Mr. Harold Walker), indicated that the rise in pensions to be introduced on 20th September is now eroded and that, at the present level of price increases, it will be eroded further? Is the right hon. Gentleman aware that further price increases in order to reach Common Market levels will introduce excessive hardship in this country, particularly for those with average incomes and below and those on social security allowances and retirement pensions?
  The Prime Minister: Perhaps the hon. Gentleman will listen to the answer to a Question and not merely to the Question itself. If he does in this case, he will see that the situation was explained by my right hon. Friend. There is an undertaking in the White Paper—and a similar undertaking was given by my predecessor when the point was raised with the last Government—that the two-yearly review of all social service benefits, to which we are pledged, will take note of
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  any changes as a result of entry into the E.E.C. As the first increase in food prices is expected to take place between April and June, 1973, and we are also pledged to a review in 1973, that review can take note of those increases.
  Mr. John Wells: Is my right hon. Friend aware that both he and my right hon. Friend the Minister of Agriculture, Fisheries and Food have from time to time implied, perhaps unwittingly, that the price of fruit and vegetables will fall to the housewife if we go into the E.E.C. whereas this, in truth, is perhaps not so? The cash received by the growers will be less but the price actually paid by the housewife will probably be about the same. Could he look at those statements again very closely before they are reiterated?
  The Prime Minister: I am prepared to examine any statements, but they are not made unwittingly. The fact is that this country has a better distribution system than most of the existing members of the Community. That is why the statement appears in the White Paper—on the best advice that we have been able to get.

  WAR PENSIONS
  Mr. Onslowasked the Prime Minister if he is satisfied with the co-ordination between the Department of Health and Social Security and the Ministry of Defence on the up-rating of war pensions ; and if he will make a statement.
  The Prime Minister: Yes, Sir. Arrangements are now well under way to pay the largest cash increases ever proposed to the nation's half million war disablement pensioners and war widows. Arrangements are also in hand to introduce the new invalidity allowance for unemployable war pensioners ; to provide a war widow's pension, irrespective of cause of death, where a war disabled husband had been receiving the constant attendance allowance at the normal maximum rate or above ; and to pay age allowance for war widows at age 65.
  Mr. Onslow: That reply will be most welcome to all who take an interest in the welfare of war pensioners. Is my right hon. Friend satisfied that the preferential treatment which war pensioners

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  have always, rightly, been able to get from the community in the past will be fully maintained?
  The Prime Minister: Yes, Sir. As I understand it, preferential treatment has been given by Administrations of both parties, and it is our intention to maintain that situation.
  Mr. Merlyn Rees: Since the number of war pensioners is getting smaller, just as those left are getting older all the time, has the time not come to have a full-scale inquiry into the whole nature of war pensions, since we have, happily, not had a world war for more than 25 years? From my experience, I believe that it is time to look at the whole subject again.
  The Prime Minister: The hon. Gentleman has great experience in these matters and I will consider his suggestion. It has not hitherto been put to me. My right hon. Friend the Secretary of State for Social Services has been trying to improve the situation in regard to the special requirements which have been pointed out to him. I will consider the hon. Gentleman's suggestion that there should be an overall review.
  Mrs. Shirley Williams: Will the right hon. Gentleman confirm that the invalidity allowance will be paid to war pensioners, even those drawing supplementary benefit, unlike the case of the rather mean deduction to be made from civilian pensioners? Will he also confirm that war pensioners will be protected against rising inflation in a way not being done for civilian pensioners?
  The Prime Minister: I do not accept the latter point made by the hon. Lady. I would like notice of the first part of her supplementary question, since it is a detailed point and I wish to give an accurate answer.

  AUSTRIAN FEDERAL CHANCELLOR (VISIT)
  Mr. Deakinsasked the Prime Minister if he will invite the Prime Minister of Austria to pay an official visit to the United Kingdom.
  The Prime Minister: The Federal Chancellor would always be welcome in this country, but there are at present no plans for a visit.
  Mr. Deakins: Would not such a visit be apposite at present since the White Paper does not make any mention of the fact that when we made our application in 1967 we were going to support the interests of our E.F.T.A. partners, who did not seek full membership, and there is no sign in the White Paper that we are intent on doing this before we become members ourselves?
  The Prime Minister: It has always been accepted that each individual E.F.T.A. country will negotiate itself for whatever form of arrangement it wants with the Community. This has always been the wish of the E.F.T.A. countries over the last 10 years, and that is still their position. It is up to them to choose what form of arrangement they want and to negotiate it, if possible, with the Community. Originally, in 1961, there was an undertaking from the then Conservative Government that the E.F.T.A. countries would all enter the Community at the same lime and would be responsible for safeguarding each other's infests. That undertaking was abandoned in 1967 with the second application and has not been renewed.
  Mr. Jeffrey Archer: Does my right hon. Friend realise that there are many of us on this side of the House who are full of admiration for the courageous stand made by the right hon. Members for Fulham (Mr. Michael Stewart) and Dundee, East (Mr. George Thomson) and that some of us look to the Leader of the Opposition to make the same courageous stand and put the country before his party?
  The Prime Minister: My hon. Friend is perfectly entitled to express his view, but I would not wish in any way to cause embarrassment to those who are supporting a cause which I sponsor.

HOUSING FINANCE
The Secretary of State for the Environment (Mr. Peter Walker): Mr. Speaker, with permission, I wish to make a statement on the reform of housing finance in England and Wales.
In my statement of 3rd November, I informed the House of the broad principles of our reform of housing finance. We have discussed the details of our

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plans with the local authority associations and the voluntary housing movement. The proposals which we have formulated in the light of these discussions are set out in a White Paper—Command No. 4728—which my right hon. and learned Friend the Secretary of State for Wales and I are presenting to the House. Copies are now available in the Vote Office.
For the first time in our history, there will be a national rent rebate scheme for all unfurnished tenants under which a rent rebate or allowance will be available to those tenants who need help to pay a fair rent for the house that they occupy. This will mean that 2½ million tenants in the private sector will for the first time have a rebate scheme available. It will mean also that council house tenants in authorities which do not at present have rent rebate schemes—that is, almost 40 per cent. of all authorities—will now be covered by a scheme.
Let me give an example. Take a council house tenant with a wife and two children who lives in a house with a fair rent of £4 a week. If his gross income is £25 a week, he will then get a rebate that will reduce his rent from £4 to about £2·70 a week. For those on very low incomes in relation to their family responsibilities, the scheme will provide a full rebate of rent so that they will pay no rent at all. When the scheme is introduced, many council and private tenants will meet less of the rent of their dwelling than before.
The White Paper proposes the replacement of the existing subsidy system by a new system to give a fresh stimulus to housing authorities and associations which need to go on building and to clear slums. If an authority incurs a deficit on its housing revenue account because it builds new houses for people now living in slums, Exchequer subsidies will meet about 75 per cent. of the deficit. In addition, if the authority makes a loss on the slum clearance operations itself, an entirely new slum clearance subsidy will meet 75 per cent. of that loss. In order to give an immediate momentum to slum clearance, we have decided that this new subsidy should be retrospective to the beginning of the present financial year.
I have already announced in my statement of 3rd November that the fair rent
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principle will be applied to local authority dwellings and extended more rapidly to private controlled tenancies. The White Paper now makes it clear that the rent increase for council dwellings which are now below the fair rent will be phased in annual steps. The average annual increase will be 50 pence a week, subject to transitional arrangements for the period up to 31st March, 1973, which are explained in the White Paper. When a private tenancy passes out of rent control and the registered fair rent is substantially higher, the increases in the rent of the tenancy will be phased in three equal annual instalments.
The Government intend to introduce a Bill early in the next Session of Parliament to give effect to the proposals in the White Paper. These proposals will create a system of housing finance which is fair to all concerned and which concentrates help on people and areas in need.
My right hon. Friend the Secretary of State for Scotland will be presenting a White Paper tomorrow which will contain his proposals for the reform of housing finance in Scotland.
Mr. Crosland: We shall want to study the White Paper and we shall want a debate at the earliest possible moment, and in Government time. Many of the implications of this statement are profoundly reactionary and will affect the level of inflation, the rate of house building and the distribution of income. I have these specific questions to put to the right hon. Gentleman.
First, will the Secretary of State confirm that at the end of three years the average rise in rents will be £1·50? What does he think will be the social and economic consequences of such a huge rise in so short a period? Secondly, will he estimate what proportion of tenants, under fair rents, will be eligible for rent rebates? Is it, as many outside commentators have suggested, half or more than half—in other words, means testing on a mass scale for the first time? What effect does he think this will have on incentives about which his party is always talking? Thirdly, what does he estimate the effect of this will be on the rate of council house building at a moment when, despite all the constant, misleading and optimistic statements of the Government, council

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house building faces a bleaker future than for a long time?
Lastly, while I am strongly in favour of owner-occupation—[HON. MEMBERS : "Oh."] It was the Labour Government who introduced the option mortgage scheme, and it was under a Labour Government that for the first time 50 per cent. of householders became owner-occupiers. Therefore, I repeat, while I am strongly in favour of owner-occupation, can the right hon. Gentleman in equity defend a system under which owner-occupiers alone receive open-ended and non-means-tested help at a time when millions of council tenants will be subject to a means test for the first time and at the same time face an increase in their rent of so large a character, if not at one stroke, at any rate three strokes?
Mr. Walker: As to the suggestion about our proposals being reactionary, there are 2½ million tenants in the private sector who will not consider that making a rebate scheme available to them for the first time is particularly reactionary. As to rent increases, I remind the right hon. Gentleman that during the period of the last Government rents in the public sector rose by 65 per cent. But I hope that the right hon. Gentleman will make clear to the country the proposals which his Government were preparing concerning the rent structure. They were not published before the election, but perhaps the right hon. Gentleman would tell us what they were.
As to the means testing of large numbers of council house tenants, I remind the right hon. Gentleman that under the previous Government 1,350,000 tenants were either obtaining subsidies through social security, means tested, or were in existing rent rebate schemes, means tested. So what the right hon. Gentleman has said is complete hypocrisy.
As for council house building, my announcement that the slum clearance subsidy will be retrospective to the beginning of this year will give a considerable momentum to tackling slum clearance, whereas the subsidy system operated by the Labour Government resulted in large numbers of towns and cities, particularly in some of the older industrial parts, almost stopping their slum clearance programmes. This will now change. [HON.
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MEMBERS : "Answer."] Socialist councils—
Hon. Members: Answer.
Mr. Speaker: Order. Hon. Members have repeatedly shouted "Answer". The Minister should be allowed to answer.
Mr. Walker: Councils of all complexions will welcome the very substantial slum clearance subsidy in these proposals which will stimulate the right type of council building. We know the position of the Labour Party on home ownership. It is very much in line with that of a party which slashed council mortgages to the extent that it did.
Mr. Longden: Whilst congratulating my right hon. Friend upon introducing this revolutionary system whereby those who can pay for what they need and those who cannot are helped by their fellow citizens, may I ask whether the White Paper will include a provision whereby those small investors who have put their money into real property rather than stocks and shares will at long last be able to get a return which will enable them not only to keep their properties in repair but also to get a fair return for their money?
Mr. Walker: It certainly will mean, with the phasing over to fair rents, that many of these people will obtain a fair rent at long last, but not at the expense of poorer tenants, because a rent rebate scheme will be available.
Mr. Charles Morris: The White Paper has just been made available to hon. Members in the Vote Office, and paragraph 52 in regard to rent rebate says :
"The allowance will be based on only a proportion of the fair rent if the dwelling is much larger than the tenant requires or is situated in an area of high property values.…"
Does the Minister accept that this paragraph will bear heavily on elderly council house tenants?
Mr. Walker: No, the limitation is a total ceiling at the very top of the scale to stop absurd abuses of the rebate system. I can assure the hon. Gentleman that it has no such effect as he suggests.
Sir R. Turton: I congratulate my right hon. Friend on his far-sighted plan, but will he give an assurance that the working of housing associations will be encouraged, bearing in mind that the

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houses which they are providing are chiefly for the elderly, who are in great need of houses?
Mr. Walker: My right hon. Friend will be pleased to know that there is a special section on housing associations. We intend to make the rent rebate scheme available to them, and, in order to encourage responsible and successful housing associations, under the proposals a new subsidy will meet for ten years up to 90 per cent. of the deposit for new building schemes when expenditure exceeds income from fair rents in the first four years. In total, we believe that this will give considerable encouragement to housing associations.
Mr. Pardoe: Although I welcome almost any statement which may sweep away the excuses which many local authorities have used for not building houses over the last few years, is the Minister aware that the net result of his earlier statement in November was a complete collapse of optimism throughout the construction industry? Is he further aware that, in view of recent estimates about public sector housing, many hon. Members on both sides of the House would think that his proposals today fall far short of the level necessary to restore optimism?
Mr. Walker: I hope the hon. Gentleman will have noticed that in the first few months of this year we have been clearing slums at the rate of 700 a month faster than last year. Only yesterday it was announced by the building industry that new starts in the owner-occupied sector for the first six months of this year were 30 per cent. up on last year.
Mr. Raison: I congratulate my right hon. Friend on his excellent statement, but will he give an assurance that he has closely consulted the Secretary of State for Social Services to make sure that the concentration of rebates and benefits on those with very low incomes is not such as to have a disincentive effect on them earning more?
Mr. Walker: Yes, Sir. These proposals are on the basis of a 17 per cent. tapering effect, which produces a minimum disincentive. I have been in close consultation with my right hon. Friend.
Mr. Hugh Jenkins: Will the right hon. Gentleman look again at mortgages? As one who is buying his house on mortgage, I am conscious that under his proposals there will be no means test for me or for any member of his party. One prominent member of his party has a mortgage of £26,000 on a very large house, which means that he is, and will continue to be, largely subsidised by the State. Will the right hon. Gentleman look into this gross unfairness and recognise that the scheme he has put before the House is divisive of the nation.
Mr. Walker: It is the intention on this side of the House to encourage home ownership, and I hope that all local authorities will give freedom to their tenants of council houses to take advantage of the incentives to owner-occupation.
Mr. Biggs-Davison: Will my right hon. Friend tell me by how much on an average council house rents were increased under the last Administration?
Mr. Walker: By 65 per cent.
Mr. Heffer: Will the right hon. Gentleman tell us exactly how the rent rebate will be calculated? Will it be based on the income of the tenant, or will the calculation include the earnings of everyone in the household, including teenagers?
Mr. Walker: There is a complicated formula for this. I refer the hon. Gentleman to the White Paper, where he will find that the rebate scheme is far more generous than the one recommended to local authorities by the previous Government.
Mr. Evelyn King: Will my right hon. Friend confirm, as I think must be the case, that at the end of three years the proportion of gross income paid in rent is likely to be far less than it was two or three years ago?
Mr. Walker: I have not done the calculations on this.
Mr. Frank Allaun: Does this mean that all rent control for private landlords' houses is now ended? Secondly, does not this mean more than doubling the rent for a vast number of houses? Is not this a deliberate increase in a major item in the cost of living? Lastly, is

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this not just a redistribution of subsidy but a net reduction which amounts to a substantial rent increase?
Mr. Walker: On the first point, control will continue of rents controlled under the fair rent formula devised by the last Government, and also security of tenure remains complete in this section. On the second point as to the increase in rents, many tenants, particularly in places like Salford, will probably as a result of these proposals, with their rebates, be paying lower rents than before. It is therefore completely wrong to suggest that there will be an increase in rents. The redistribution means that instead of having £200 million of subsidies only £1 in £10 of which goes directly to help those in need, we are having £200 million of subsidies the whole of which will go to help people in need.
Mr. Kenneth Baker: I congratulate the Secretary of State on one particular aspect of the White Paper, and that is the substantial increase in slum clearance grants which will be of great benefit to inner London boroughs. I ask my right hon. Friend to redouble the efforts he is presently undertaking to speed up slum clearance within the Inner London boroughs and to bring to their attention the generous grants mentioned in the White Paper.
Mr. Walker: Yes, Sir. I hope that my announcement today that the slum clearance subsidy will be made retrospective will result in local authorities immediately going ahead with substantial programmes.
Mr. Carter: Is the Minister aware that, far from being welcomed in the country, his statement today will be received as a barbaric and savage attack on the principle of public sector housing? Is he not aware that in the country as a whole this new principle of a national rent rebate scheme will be interpreted as the poor keeping the poor?
Mr. Walker: It is, if I may say so, not something that will be greeted in that way by people in the private sector who have never previously been entitled to a rebate, or by people living in the areas of the 40 per cent. of local authorities who have no rebate scheme. The hon. Gentleman's remarks come ill from a party which, when in government, sent
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round a circular urging local authorities to adopt a rent rebate scheme far less generous than the one I have announced today.
Mr. Chapman: As one who believes sincerely that had these policies been introduced 20 years ago there would not have been slums, obsolescence and overcrowding today, may I ask how many families my right hon. Friend estimates will receive rent rebates under his scheme, compared with those who would have received rent rebates under the scheme of the previous Government?
Mr. Walker: It is difficult to estimate this accurately, but quite certainly very substantially more, because 2½ million tenants in the private sector, which include many of the poorer households in the country, will receive benefit.
Mr. Marks: Who will provide the funds for rent rebates for private tenants? Will fair rents be assessed by rent officers or by reference to gross rateable value?
Mr. Walker: In regard to the second point, rent officers ; the answer to the first point is 100 per cent. by the Exchequer.
Mr. Costain: Could my right hon. Friend explain why it is that whenever any scheme is put forward to enable people to live in decent houses and to get a rent rebate the Opposition scream "means test", when in fact each time an income tax form is filled in it amounts to the same thing?
Mr. Walker: I think my hon. Friend will find that when right hon. Gentlemen opposite publish the proposals which they had in mind before the election it will be seen that their policies will not be all that much different.
Mr. Freeson: Could the right hon. Gentleman clarify one or two points which have become a little obscure in the course of some of his replies? In answer to a request for information about the cut in the total ceiling, he referred to a figure of £200 million. Is it still the Government's intention, as announced by the Chancellor of the Exchequer last year, to reduce by the middle-1970s the total projected expenditure on regional spending from £370 million to about £200 million and to hold it at that level rather than to expand it? On the question of

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the total global figure, could the right hon. Gentleman say what estimates he or his Department have made of the total surplus or "profit" which will accrue to the housing revenue accounts throughout the country as a result of the new policies he has proposed in the White Paper?
Mr. Walker: On the first point, the figure will be kept at present levels and will not increase to the levels originally estimated under the old subsidy scheme ; but as the previous Government were carrying out a review of housing finance, presumably they had something like this in mind too.—[HON. MEMBERS : "No."] The right hon. Gentleman is free to publish his party's policy on rents, and the sooner he does so the better we shall be pleased. On the second point, I cannot give the estimated total so far as subsidies are concerned.
Mr. Julius Silverman: The Minister makes much of the question of rebates in the private sector. Has he examined the experience of the city of Birmingham which alone so far promoted a Private Bill to provide for rebates to private tenants, but which has discovered that the number of rebates which have been given, out of a total of about 60,000 estimated private tenants, amounts in all to a few hundred. Is he not grossly overestimating the benefits which this scheme will give to tenants in the private sector?
Mr. Walker: No, Sir. The rent scheme in Birmingham was an interesting and important experiment, but it was very different from the rent rebate scheme which we are introducing.
Mr. Blenkinsop: Why does not the Secretary of State answer the question put to him as to how many tenants will pay excessively high increases in rent following his proposals, and why does he intend to cause local authorities to undertake rent rebate schemes whether or not they wish to do so?
Mr. Walker: It is vital to provide a rent rebate scheme for everybody concerned in the country. If the hon. Gentleman is suggesting that the rents are outrageous. I will point out that they are the rents agreed by the previous Government as being proper.
Mr. Harold Wilson: The right hon. Gentleman has three times made accusa-
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tions about the previous Government's policy, contrary to the usual convention of proprieties as to what papers were available to a previous Government. [HON. MEMBERS : "Oh."] Will he produce his evidence that any right hon. Member on this side of the House when a Minister had approved any such policies? Is he aware that I can categorically state that all my right hon. and hon. Friends in the right hon. Gentleman's former Department will confirm that no policy whatever was decided by those former Ministers on the lines of what has now been put forward? [Interruption.] Hon. Members opposite may laugh, but this is a serious matter of housing and of governmental proprieties. Would the right hon. Gentleman now produce the sources of his evidence? Will he take it from my right hon. and hon. Friends that there have been no such decisions, but that where proposals were put up—he cannot know this, but I will tell him—on the lines of his White Paper, they were rejected by the former Government?
Mr. Walker: The previous Government announced that they were carrying out a review of housing finance. They gave a reason for that review, namely, that they wanted to see that help went to those concerned. They spent many months on that review and, surprisingly, they did not come to any publishable conclusions before the date of the General Election. In spite of constant pressure from our side of the House at the time when we were in Opposition seeking an announcement about the conclusions resulting from those many months of work, the previous Government were unable to come to those conclusions. It is remarkable that the previous Government spent months in not coming to conclusions and that the present Government have taken two months to analyse the situation.
Mr. Harold Wilson: The right hon. Gentleman is now talking a very different language from when he began. Three times he said that we had come to conclusions and did not announce them. The right hon. Gentleman is now sliding back to the position that what we did was to spend some time examining the situation—and so we did. We rejected the facile and reactionary proposals he has accepted. Will he now withdraw?
Mr. Walker: I stated and I repeat—
Mr. Carter: Spiv.
Mr. Walker: I categorically state that I know of no conclusions reached by the previous Government. [Interruption.] I was stating my belief as to the conclusion they would come to. But now at last the right hon. Gentleman has the unique opportunity to tell the country and Parliament what his conclusions are.
Mr. Harold Wilson: I take the opportunity to tell Parliament that what the right hon. Gentleman said was a total misrepresentation of the position and he should withdraw it. The right hon. Gentleman should further recognise that matters of housing, which affect millions of people, are not matters for the slick approach he has shown today. I hope that when the right hon. Gentleman studies HANSARD tomorrow he will consider making a personal statement to the House. I will not press him this afternoon. But will he now answer the question put at the outset by my right hon. Friend? Could the House have a debate in Government time before the recess—this White Paper has been produced only two or three weeks before the recess—in which we do not merely have to accept the policy which he has outlined this afternoon but in which the whole House concerned with different points of view on housing may examine the Tightness or wrongness of the right hon. Gentleman's proposals? Could we have an answer to that question?
Mr. Walker: This is a question for my right hon. Friend the Leader of the House. But as far as I am concerned, I would welcome a debate, because I am dying to hear the right hon. Gentleman's views.

NEW MEMBER
Nicholas Guy Barnett, Esquire, Member for Greenwich, made the Affirmation required by Law.

DRUGS AND POISONS (CHILD-RESISTANT CONTAINERS)
4.0 p.m.
Mr. Greville Janner: I beg to move,
That leave be given to bring in a Bill to make it unlawful to supply drugs or poisonous substances otherwise than in child-resistant containers.
It is estimated that about 25,000 children under five will be accidentally poisoned in the coming year in this country. Although perhaps less than 100 will actually die, no one knows how many of the rest will suffer permanent injury to the liver, the kidneys or the mind. This is an important and growing problem which has not been dealt with properly by any Administration. Over half the children who will be poisoned will in fact suffer as a result of swallowing medicines and drugs which were not in child-resistant containers. These are only the figures of admissions to hospital and there is still perhaps the same number treated by general practitioners or their parents who form no part of this unpleasant and largely unnecessary statistic.
The number of poisoned children is growing. In Leicester, in the whole of last year, there were 145 admissions of poisoned children aged under 5 to hospital. By the end of June this year there were already 139. In the circumstances, there is no substitute for parents or those in charge of children keeping these dangerous objects away from them, preferably locked up, but we must face the fact that people are careless and we must make carelessness more difficult.
Many of today's containers can open simply by being shaken. Pills may empty into a mother's handbag without her being careless. In some cases it is not possible to buy child-resistant containers from chemists even if one wants them. So even the parent who wishes pills to be kept in a child-resistant container may have no means of getting one.
So far as there is an answer, it lies partially in the compulsory provision of child-resistant containers. There is no perfect container, but I have a collection of various objects which some adults—some sitting beside me—have found not at all easy to open. Some are very

227
cheap and cost a fraction of a penny more than the ordinary containers available today. Others cost several shillings, but in either event, if they save lives and prevent the poisoning of children, their enforced use is surely elementary.
The cost to the National Health Service has been given as the main reason for non-introduction. We are told that this cost may be about £500,000 per annum. If we take even 10,000 children going to hospital for even 48 hours each at £10 a day, we have a figure of £200,000. If we add the number of days lost from work by anguished parents, we reach a sum likely to be far in excess of £500,000.
In any event, this cost should not be totted up in terms of money. Where children's lives are involved, even if this Measure saved 50 lives, 10 lives or only one life, it is worth putting on the Statute Book. With some 10,000 children a year being poisoned through the failure to supply pills in child-resistant containers—and with the increase in poisoning growing at the present rate, this is very likely—this Measure will, I hope, commend itself to the House.
There is no reasonable alternative to these containers. We know that they are not perfect ; some are not moisture-proof. Research is going on. In Leicester, Dr. Matheson, consultant pediatrician at the Leicester Royal Infirmary, is to publish a paper. But we cannot wait, and parents who see their children poisoned see no good reason why we should wait.
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Also, those parents are often too ashamed of their carelessness to apply public pressure, but pressure is coming—from the medical profession, pharmacists, chemists and their trade paper and from hon. Members on both sides of the House.
I appreciate that, in the present state of Parliamentary time, this Measure is likely to have a short life, but at least I hope that it may be born alive. If it is, it will show the concern of the House about a serious and growing national problem. If I am given leave, parents will know that this is a matter which concerns us all. It will show that hon. Members are not prepared to let it rest until there is this minimal legislation for the expenditure of this comparatively trifling sum to save money and children's lives and, for far greater numbers, children's health, and to prevent anxiety and unnecessary strain and illness affecting so many thousands of our constituents.
Question put and agreed to.
Bill ordered to be brought in by Mr. Janner, Dr. Vaughan, Dr. Dickson Mabon, Mr. David Steel, Dr. Shirley Summerskill, Mr. Arthur Davidson, Mr. Goodhart, Mr. Bradley, Dr. Miller and Mr. Dykes.

DRUGS AND POISONS (CHILD-RESISTANT CONTAINERS)
  DRUGS AND POISONS (CHILD-RESISTANT CONTAINERS)
  Bill to make it unlawful to supply drugs or poisonous substances otherwise than in child-resistant containers, presented accordingly and read the First time ; to be read a Second time Tomorrow and to be printed. [Bill 213.]
ORDERS OF THE DAY
  SUPPLY
  [26TH ALLOTTED DAY],—considered

  SCOTLAND (ECONOMIC SITUATION)
  Mr. Speaker: Before I call the right hon. Member for Kilmarnock (Mr. Ross), I would inform the House that I have selected the Amendment standing in the names of the Prime Minister and his right hon. Friends.
  4.8 p.m.
  Mr. William Ross: I beg to move,
  That this House condemns Her Majesty's Government for the failure of its economic policies, which have led to the highest level of unemployment in Scotland in post-war years and increasing hardship for the people of Scotland.
  It is nearly 13 months since the people of Scotland decisively rejected the policies of the party opposite, and, at every democratic opportunity which they have had since then to express a political view, they have demonstrated that they have not changed their minds. In these intervening months, virtually an unbridgeable gap has been created between the people of Scotland and this Tory Government. Their credibility with the people of Scotland has gone. I do not blame just the Secretary of State, although he must accept his part of the responsibility for the deeds and misdeeds of his Government, but I see that it has been said that the present Government have effectively dug the grave of the Tory Party in Scotland.
  We condemn this Government for their indifference, their neglect, their callous disregard for the needs of Scotland and their complete mishandling of the situation. The facts are beyond dispute. In the month of June, we had the highest unemployment figure for any June month in the post-war years. The fact is that unemployment in Scotland always rises between June and July. There is a reason for it. But we face a worsening situation, not just next winter, but next summer. We shall have the latest unemployment figures next Thursday. It may be that the Secretary of State is in a position to give
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  us an estimate of what the figures are likely to be. I think that they will shock the whole of Scotland.
  The situation is worsening month by month compared with the position a year ago, and we have no effective action from the Government. We have no indication from them that they are seriously concerned, although I notice that in the Amendment they propose to move, they talk about the figures being "regrettably high".
  Comparing January of this year with January of the previous year, unemployment in Scotland showed an increase of 19,000. In February, the increase compared with the year before rose to 27,000, in March to 31,000, in April to 34,000, in May to 35,000, and in June to a figure which was 37,500 higher than it had been the year before. That is a staggering increase, and it is worsening month by month, with the Government totally inactive.
  Right hon. and hon. Gentlemen opposite will say that they inherited the situation. That is what we were told in February. They said that they inherited a situation of 80,000 unemployed in summer time. What will the right hon. Gentleman say now when, as a result of his racing round Scotland like a frightened rabbit, the figure is 121,000 and likely to rise still further?
  Hon. Members have to appreciate that, in Scotland, between 76,000 and 80,000 children leave school each session. They do not all leave at the end of the session which, this year, closed at some time between 23rd and the end of June. Many of those children will be registering as unemployed. Of those who leave during the year, probably about 40,000 or 50,000 will do so at the end of the summer session. Many of them will appear on the register in the month of July and in the figures that we are to be given next Thursday.
  In Scotland, we face the prospect of 130,000 unemployed in the month of July. Anyone who has studied the relationship between winter and summer unemployment figures can guess easily what will happen. It is too late for any action, even any action that is likely to follow the announcements which I have no doubt that the Secretary of State will be making today. Inevitably, the unemployment

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  figure will rise to at least 150,000 in the month of February next year, and the chances are that it will be very much higher.
  All that the Government can say is, "Please, Sir, it was not us." They have now been in office for 13 months. For four of those months they said nothing ; they went into hibernation. However, they were aware of the problem. They were wringing their hands in despair when unemployment was half what it is today and saying that something should be done. For four months, they said nothing. Then, on 27th October, we had a statement from the Chancellor of the Exchequer.
  Some people seem to have forgotten about that statement. We had an echo of it today in the Government's statement on their housing policy. That was foreshadowed in the statement on 27th October when they suggested that by the middle 1970s they would save between £100 million and £200 million on housing subsidies, and that the figure for Scotland would be between £10 million and £20 million.
  What were the important things done for Scotland then? We were told that investment grants, which were almost the lynchpin of development in Scotland, were to end. R.E.P. was to be not tapered off or phased out but brought to an end in 1974. For Scotland, investment grants in the previous year had meant £75 million, cash. R.E.P. had meant £60 million.
  Mr. Ian MacArthur: How much in S.E.T.?
  Mr. Ross: The hon. Gentleman will be able to talk about S.E.T. in a few weeks' time, when he sees exactly how prices tumble. I am always surprised how people forget the way in which S.E.T. was taken off Highlands hotels and other hotels in different parts of Scotland. There was no drop in prices. If the Gentleman wishes to take comfort from what is likely to happen to S.E.T., let him look at what was said in the Glasgow Herald last week—
  Mr. MacArthur Mr. MacArthur rose—
  Mr. Ross: No, I shall not give way. The hon. Gentleman is good at interrupting everyone else's speech—
  Hon. Members: Give way.
  Mr. Ross: No. The hon. Gentleman no doubt will have an opportunity to make his own speech later on. We have plenty of time.
  So there we have the position, with investment grants finished and with R.E.P. to go—
  Mr. MacArthur: And S.E.T. halved.
  Mr. Ross: But that was not all. There was the slashing of the nationalised industries' programmes by £43 million, starting this year, and rising in three years' time to a cut of £73 million. A closing date was put into the programme for building new hotels. Then there was the menace threatened, which has now become reality, of the slash in housing subsidies which local authorities have been discussing with the Secretary of State for many months. Every single item was guaranteed to have an effect upon the Scottish economy and upon investment.
  I am sure that the right hon. Gentleman remembers what he said at the time. On 28th October, the day following, The Scotsman said this :
  "Mr. Gordon Campbell, Secretary of State for Scotland, insisted last night in a statement that the refashioning of incentives for regional development without any reduction of the money for development areas would be an impetus for Scottish development. The new methods would be more effective."
  That was October. The Secretary of State must be in despair about the position of the Scottish economy today. No doubt the right hon. Gentleman has had a copy of the magazine Scotland sent to him. He should read the business page, which says :
  "It is a long time since the outlook for the economy looked bleaker. At the risk of being boringly repetitious, action by the Government is long overdue if we are not to drift helplessly into recession and crisis … Of all the manifestations of our economic ills none is more worrying than the chronic low level of investment."
  That is not the only publication to confirm the pessimism of right hon. and hon. Gentlemen on this side of the House. On the same day, The Scotsman said :
  "… it seems that if the economy ceases to stagnate, the resulting benefits for Scotland could be substantial, but if economic inertia continues, then she could well be worse off."
  We are worse off. Generally speaking, the responsibility for this situation lies

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  not just with the Secretary of State but with those who are in command of the whole economy. Inertia has continued despite what the Government did in October and despite what they did in the Budget.
  The Secretary of State can point to special development areas and all the rest, he can have all the local Employment Acts and special development areas he likes—indeed, he can have all the incentives he likes, although the present ones are pretty poor compared with the direct incentives which we gave—but if there is no mobile industry and no confidence in the country, he will not get the development, the movement or the expansion of industry.
  Todays Financial Times, under the heading,
  "No signs of upturn in U.K. production",
  goes on to say :
  "There are no signs of an upturn in U.K. industrial output. The May production figures which became available yesterday, show a fall from April's, and in the three months March-May production was lower than in December-February."
  So far from advancing, we are going down
  If right hon. and hon. Gentlemen opposite do not like that newspaper, I refer them to The Times of today, which says :
  "… the Treasury's mid-year economic assessment should now have served that purpose. It will have painted a picture of stagnation in both current expenditure and investment. … The measures that the Government did adopt either failed to have any discernible impact on demand, such as the reduction in income tax, or were actually deflationary in their immediate effect, such as "—
  mark these words—
  "the shift from investment grants to investment allowances."
  Everyone in Scotland, from Lord Clydesmuir to the S.T.U.C., is saying exactly what we told the Government in October would happen : that they would dry up the impetus to development in Scotland by the change from investment grants to allowances. It must have made good reading for the Secretary of State if he read The Guardian leader this morning, which says :
  "Scotland's winter wind… Unemployment is already as bad as it could possibly be."
  The writer of that article does not know the Tories, because there is worse to come. When the English used to talk
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  about going back 40 years to find their worst unemployment figures, we used to be able to say that we had only to go back to 1963 when a certain right hon. Gentleman was the President of the Board of Trade. That right hon. Gentleman is now the Prime Minister, and he has not lost his touch when it comes to Scotland. The first six months of 1971 have proved the most disastrous period that Scotland has had. Right hon. and hon. Gentlemen opposite cannot get away from the fact that this is the result of their misled and misguided but calculated policies. The Prime Minister himself on Scottish television, when attacking the incentives which we gave, said that they were over-generous. But they were effective. He was saying that we did not need them. What did we want? A soup kitchen economy in a soup kitchen country?
  We had another indication today of the madness of right hon. and hon. Gentlemen opposite. They have means test madness : means tests for rents for council houses, means tests for rents for private houses, means tests for school meals and school milk, means tests for welfare services, for rent rebates and for rates rent rebates. It is means tests, means tests, means tests. Scotland's economy is drifting towards ruin, and right hon. and hon. Gentlemen opposite know it. It is not just the lame ducks. Redundancies in Scotland were being declared at the rate of 6,500 in the months of April and May, despite this great new impetus towards development.
  What did we get in I.D.C's? In April and May jobs prospects from I.D.C's granted under the great new system amounted to 754. Yet nearly 12 times that number of redundancies were being declared as new jobs were being created. But new jobs being created—
  Mr. James Hamilton: Cremated.
  Mr. Ross: —have a habit of disappearing in the pipeline. I nearly said "cremated". I probably would have been right. There is no doubt about the redundancy notice. Workers receive redundancy notices and on the same day their place of work is closed.
  Into this situation we have the hacking policies of the Government relating to

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  the steel industry. They held up an announcement, which was made and authorised in January, 1970, that the Ravenscraig development was going ahead ; but, with the interference of this disengaging Government, we got the announcement last week after 18 months of delay. The hacking of the industries connected with the steel industry has created gloom and despondency throughout industry generally.
  Let us consider the activities of the Secretary of State for Trade and Industry, not the Minister for Trade, who, I understand, is winding up the debate today. However, I welcome his return to the scene of, dare I say it, his former triumphs with the Scottish economy. The Secretary of State for Trade and Industry ought to be here, because that industrial anatomist has been very busy. He has had the enthusiastic assistance of the hon. Members for Cirencester and Tewkesbury (Mr. Ridley) and for Bournemouth, West (Sir J. Eden), the like of which we have not witnessed since a celebrated anatomist in Edinburgh engaged the services of Burke and Hare.
  It was into this situation that U.C.S. fell. I will not rehearse that sad story. We have already, through questions and the answers we have received, built up an interesting dossier of comings and goings and of information being sent. Indeed, we know from the report which was prepared on 9th December by the hon. Member for Cirencester and Tewkesbury just how all that was done concerning U.C.S. was calculated, planned and laid down in December 1969. This is one of the saddest and most disgraceful stories that has ever come out about a Government Department's activities. I hope that my hon. Friend the Member for Glasgow, Craigton (Mr. Millan) will add one more date to that dossier : that just after that statement made by the Secretary of State for Trade and Industry on, I think, 4th November the credits for U.C.S. were held up. In other words, the lame duck policy was put into operation.
  Mr. T. G. D. Galbraith: The right hon. Gentleman complains about what he calls the "lame duck" policy. Will he explain to the House the criteria on which he would give help to ailing companies? Would
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  it be to all companies, or just specially favoured companies?
  Mr. Ross: That is a very good question. I am sure that the attitude which the Secretary of State adopted when the Cabinet discussed U.C.S. was the same as mine. What is involved is not just the 8,500 jobs at U.C.S., but 20,000 jobs elsewhere, because nowadays most of the work of a shipyard is assembly work, while the main work is done by outside suppliers. Every effort should therefore be made to ensure that U.C.S. is kept in existence. We should remember the statements about U.C.S. being on the road to viability and the improvements in its launchings and contracts. It could have been saved. If one balances any question of doubt against social consequences, one realises what should be done. It has rightly been said that U.C.S.
  "is fast becoming a symbol of Scotland's economic plight …"
  There is no doubt that U.C.S. should be saved, but hon. Gentlemen opposite took the decision to butcher the company before they became the Government.
  Mr. MacArthur: Rubbish.
  Mr. Ross: That was the advice given by the hon. Member for Cirencester and Tewkesbury, and the existence of that report has never been denied. The hon. Gentleman drew up the report. The Secretary of State said that he never saw it. Perhaps I may tell him that his name was on the circulation list. He was one of two Scottish Members to whom the report was to be sent. It may well be what the right hon. Gentleman did not receive it or did not read it. Or it may be that even as a member of the Shadow Cabinet he was not brought into these consultations on the future of the shipbuilding industry. If that is so, that is even worse than admitting that he had seen the document. It is an indictment of the right hon. Gentleman's position in the Conservative Party.
  We are now faced with the position that the whole of Scotland is in uproar about U.C.S. I have never before seen a march such as that which I saw in London of unemployed workers and people whose jobs were threatened. There were men from the shipyards. There were ministers from the Church of Scotland, priests from the Roman Catholic Church and men from local authorities. When the march was repeated in Glasgow it proved to be

  237
  the most disciplined demonstration that we had ever seen against a Government decision.
  Mr. Galbraith: What about Greenock Dry Dock?
  Mr. Ross: The hon. Gentleman should appreciate that the financing of that dock was done by his Government. If he wants to know anything about it, he should read the report of the Public Accounts Committee. The hon. Gentleman should realise that Greenock Dry Dock is still in existence and is being used. Let us hope that after the four wise men have finished and the recommendations have been made to the Government the whole of U.C.S. will be fully employed. If that is going to be the outcome of U.C.S., they should never have embarked on these proceedings. I have said before, and it is true, that the Government will spend far more on U.C.S. than it would have taken to obviate the whole position. The action was the result not of policy but of dogma. It is only one facet of the Government's policy which has created this gulf between them and the people of Scotland.
  Not very far from U.C.S. there is a place called Alexandria, which we fought to save when the Ministry of Defence decided that it had to give up the work that was being done there. I can remember the weeks of work put in by officials of the Scottish Office, by Ministers, and by officials from the Ministry of Technology and the Ministry of Defence. I remember how we managed to get Plessey to take over that factory. One deciding factor in that decision was the ability to use the machinery and the people who were there. About 18 months ago there was talk of increasing the number employed there to 2,000. Today that factory is being closed.
  I think that there is room for two inquiries in Scotland. There should be an inquiry into what happened about that factory. It is time that we had a public reply to my hon. Friend the Member for Dunbartonshire, West (Mr. Ian Campbell), who has asked some pointed questions about this matter. This factory itself is important to the area in which it is situated, but it has become even more important following the considerable improvements in the road pattern of the area, thanks to the work of the Labour Government.
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  I should like to know what the Secretary of State did about that. When we have a Government who do not believe in intervening, a Government who are actively engaged in disengagement and in leaving everything to private enterprise, we realise that the outlook for the people of Scotland is dismal, bleak and grim. What did the Government do about Plessey, and what are they going to do about this factory?
  The excuse given by Plessey was that it had to safeguard its industries in the south. Are we to understand that that is to be the pattern in future, and that all regional policy has been thrown overboard? Regional policy does not begin and end with local employment Acts. It must be seen in every sphere of Government influence. It must be seen in what the Government do about the nationalised industries to ensure that the special bias that is required is given to the development areas. One of the sad things is that the Government have not used their power, through the nationalised industries, either to reflate the economy or to give discriminatory reflation where it is required. That is certainly something that they could do.
  There is also the problem of Hunterston. The hon. Member for Bute and North Ayrshire (Sir F. Maclean) may have been pleased with what happened at Hunterston, but the deep-water facilities there are unique in this country and they must be used for the advantage of the people of Scotland. There was a time when the Clyde was a rural river, but we have seen the changes that have occurred in the whole pattern of trade, both incoming and outgoing.
  I remember how when the idea was first mooted elaborate proposals were put forward by Glasgow University and the Scottish Council—Oceanspan. The development of Hunterston was first suggested in relation to the steel industry. The ore terminal was urgently required because of the expansion of the industry and the future of the general terminus quay at Glasgow. Following the inquiry we waited for months and months, but we heard nothing at all from the Secretary of State. The right hon. Gentleman says "No" by instalments. He says that he has zoned the area, but he refused Chevron for the purpose of industrial development. It is not to be left to the

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  local planning authority to decide who shall go to an area. If the right hon. Gentleman cannot agree to Chevron, what can he agree to?
  Sir Fitzroy Maclean: The right hon. Gentleman has accused my right hon. Friend of being negative in his attitude. All that he has said "No" to so far is an American oil company which would have brought few jobs but done a great deal of damage to amenities. I remind the right hon. Gentleman that he did the same thing, and I think quite rightly, in respect of Murco.
  Mr. Ross: The hon. Gentleman is entitled to his opinion. I would rather that he did not impute opinions to me.
  Sir F. Maclean: I did not.
  Mr. Ross: The hon. Gentleman said that I had done the same thing in respect of Murco. That is not true. Let him read the reports and he will find that they do not compare. [Interruption.] I can assure "Mr. Europe"—
  An Hon. Member: Who is he?
  Mr. Ross: The right hon. Gentleman went to Bonn once and the Scottish Press said : "Here is Mr. Europe". Instead of going to Bonn the right hon. Gentleman ought to go to Bonhill and see what sort of reception he meets there. I can assure hon. Gentlemen that if the two decisions are compared they will be found to be entirely different. What will happen about Hunterston? When will we get an approach from the British Steel Corporation and the Clyde Port Authority about the ore terminal? Is this something else which is being delayed by the cutting down of the grants foreshadowed in the statement of 27th October about port modernisation?
  We are anxious to hear about this, because a terminal would be the first step. I hope it is one of the things that the right hon. Gentleman will announce today. We want to hear him say that he will give the go-ahead for the construction of an ore terminal at Hunters-ton. If we do not get that terminal we shall never get a steel complex there. One of the most engaging things about the right hon. Gentleman is that he endowed his shadow interventions with an aura of Eastern prophecy. About 1963
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  he suddenly discovered the existence of Hunterston and its unique facilities. Indeed, he claims to be a pioneer about this. He talked about the steel complex there, instancing what was being done elsewhere and seemed to think that there should be a speed-up of decision-making. We think so too.
  There was no indication of that from the Secretary of State for Trade and Industry the other day. Many fears are being expressed in Scotland today that the new growth point in Britain is not to be Hunterston but Foulness, Shoeburyness and Southend-on-Sea. It is interesting to note that while Scotland is being fobbed off with an experimental rifle range from Shoeburyness which Wales refused to have, the Shoeburyness area is being developed with the construction at Foulness of an airport which will cost £150 million more than if the airport had been sited elsewhere.
  We know that the V.A.T. office is not going to Wigtownshire or Glasgow, or Edinburgh, or any development area. It will go to within a few miles of Shoeburyness. Is this the new development area policy of the Tory Government? We have seen the easing up of I.D.C. policy—and there will need to be a considerable easing up to allow that kind of development. It is depressing that we spend years and years, pressing Governments and Cabinet colleagues, getting accepted the idea that priority should be given to the regions and then suddenly within a few months of a new Government all is lost and the regional policies come virtually to a halt.
  The right hon. Gentleman takes a pride in saying, "We created the special development area policy"—
  Mr. Galbraith: On a point of order, Mr. Deputy Speaker. Could you ask the right hon. Gentleman to address you because it is difficult to hear what he is saying.
  Mr. Deputy Speaker (Miss Harvie Anderson): I do not think the right hon. Gentleman means any discourtesy, but it is rather difficult to hear him.
  Mr. Ross: It was not calculated. I am sure that the hon. Gentleman would be the last person to accuse me of that discourtesy. I have a high regard for him.

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  He was the only Member with the courage to support the Government over U.C.S. The rest of the troops fled the field—he was the only Scottish Tory who spoke.
  Mr. MacArthur: Typical distortion.
  Mr. Ross: The position of the Scottish economy is serious ; the army of the unemployed grows daily. I do not say that hon. Gentlemen opposite are inhuman ; they are simply blind to the hardships caused by certain decisions they take. There are many people in Scotland who have forgone their holiday this year. On Clydebank they went on holiday on 2nd July for three weeks ; the men in the Govan, Linthouse and Fairfield Yards will go on holiday at the end of this week. None of them knows what will happen after 4th August.
  Will the right hon. Gentleman tell us whether he has so far had meetings with the Four Wise Men, and with the Liquidator? Can he cheer us up with a statement that the Government have changed their mind about the annihilation of U.C.S. and the selling-off of what they have, if necessary at a pittance, to quote a celebrated document? Can they tell us anything about the S.D.A. beyond what we already know?
  The right hon. Gentleman knows that I have been seeking an interview with him about the position of Kilmarnock, Ayr and South Ayrshire. My hon. Friend the Member for South Ayreshire (Mr. Sillars) has been discussing this with me too. The people of Livingston are concerned about it, as are the people of Dundee and Glenrothes. If I were a member of the Highland Board, I would be concerned about it too. It has become nonsensical. [Interruption.] I am not against the special area development policy ; I am against unfair discrimination in areas worse off than those accorded special development area status.
  Will the Under-Secretary tell me how the unemployment in Irvine compares with that in Kilmarnock, or that in Ayr with Paisley? I will tell him. It is very much worse in those areas left out of the special development area scheme. Administrations should be fair in giving help to areas but let us not delude ourselves that a special development area,
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  whether or not it covers the whole of Scotland, would be of any use unless the economy is right. This is what the Government have failed to do. They are getting plenty of advice from everyone about that. The hon. Gentleman should turn his mind to a general reflation in the country. In Scotland there should be massive reflation.
  I am not talking about £8 million to be spent over two years an the maintenance of trunk, principal and unclassified roads. That is the sort of joy we got this morning in Committee upstairs from the right hon. Gentleman. And what does it mean? It is less than £4 million a year, and we spent more than that on winter works in 1968. That is all we were offered this morning by the right hon. Gentleman.
  A considerable part of even that sum must be paid by local authorities, because the right hon. Gentleman said that 75 per cent. would be the grant for maintenance of principal roads, with a 50 per cent. grant for unclassified roads. I trust that the right hon. Gentleman recalls the cut made in the rate support grant for local authorities of £1 million this year and £2 million next year. What is the net benefit of all this to Scotland? Will it cure unemployment? Of course not, and I hope that the right hon. Gentleman will not rest on this ludicrous position.
  We require a massive improvement, and the Government must consider pouring orders into these areas, particularly in relation to the nationalised industries. We did this when we were in power through the Post Office and the steel industry. Only by this means can we ensure that the jobs in the factories that supply the national industries are boosted.
  The Government must turn their mind away from what they have done in respect of, for example, investment grants. Lord Clydesmuir recently gave the Government some good advice and his words are quoted in today's Guardian. He is the mildest of men, and when he gets angry with a Tory Government something must indeed be wrong. There is no indication that his words are being heeded.
  The whole question of confidence is at issue. The people of Scotland have a Government for whom they did not and would not vote. Hon. Gentlemen opposite dislike the people of Scotland for

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  their political loyalty to the Labour Party. [Interruption.] The Times said this morning :
  "The position in Britain today may well be one where the forces of recession are so deeply entrenched that traditional reflationary measures on their own are powerless to remove them ".
  We have reached the stage in Scotland when we have become so deeply embedded in unemployment that it will be difficult to get out of it. The Times went on to say that the Government's measures lacked
  "that economic catalyst blithely described as the confidence factor without which no sustainable economic growth is possible".
  It added :
  "It is within the Chancellor's power to help fill up industry's order books by stimulating demand. His real problem is to convince industry that they will remain full in the lifetime of future fixed investments".
  Confidence in this Government has gone. It is not a change of policy we need, but a change of Government.
  4.54 p.m.
  The Secretary of State for Scotland (Mr. Gordon Campbell): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof :
  'recognising the special problems that have arisen in Scotland and the regrettably high unemployment accompanying them, which has resulted from the inflationary policies pursued by the last Government, endorses the measures introduced by Her Majesty's Government, including the creation of a special development area covering West Central Scotland and other powerful incentives for regional development, as relevant and effective for dealing with this situation'.
  The upward unemployment trend when we arrived in office last year was a depressing fact. In every month since October, 1969, unemployment had been higher than in the corresponding month of the previous year, and the gap was increasing all the time. That was the position from October, 1969. We could, therefore, see what the trend was before we came to office.
  Even more depressing was the prospect that the raging inflation at that time would make it difficult to alleviate and put matters right. The high rates of unemployment in Scotland in recent months would not have happened if this inflation
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  had not been rife in 1970 and if there had been some reasonable growth in the economy. But because of rising costs, resulting mainly from unexpectedly high wage settlements, firms have felt impelled to reduce their labour forces and have been understandably cautious about launching into new investment and expansion.
  Mr. Donald Stewart: How can the right hon. Gentleman maintain that inflationary wage settlements were the cause when he knows that average wages in Scotland have been lower than in England?
  Mr. Campbell: I will come to that shortly.
  During the past year the Government, for this and other reasons, have made it one of their main tasks to do all within their power to curb inflation and its effects on costs and prices by tackling this at its source—inflationary wage settlements. [Interruption] There are some welcome signs that we are succeeding, but the inflationary situation which we inherited cannot be put right overnight.
  Mr. John Robertson: Fifteen months is a long night.
  Mr. Campbell: As the House knows, I deplore the current high levels of unemployment in Scotland. They are painful in human terms and wasteful because our resources are not fully used. The Government are determined to put this right and the policies and measures which we have introduced, some of which are only now beginning to have effect, are designed to promote soundly based growth, with special emphasis on regional development.
  Let us examine the situation in the middle of last year, when inflationary wage settlements were threatening to cripple trade and industry. [Interruption.] There had been a period of compulsory squeeze, which many hon. Gentlemen opposite, among others, opposed and criticised. When the freeze came to an end, the flood from the thaw was allowed to pour over the dam. The result at the end of the day was a situation which was worse than if there had been no freeze.
  Moreover, the consequent rise in prices was inevitable, though naturally later in

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  its impact. This has nowhere been more neatly described than in these words :
  "The main fact is that we won the 1966 election by choosing the moment of wage inflation before the prices had really been felt to rise ; and obviously we were seeking to do it again in this election in 1970."
  That was said in a radio broadcast on 15th April by the right hon. Member for Coventry, East (Mr. Crossman). There is no doubt that the decision to let wages rip in the first part of last year, and to let the inevitable later price rises look after themselves after the election, was a political decision which had most damaging effects on Scotland.
  Mr. George Lawson: My hon. Friends and I do not base ourselves on the words of a journalist. Is the right hon. Gentleman aware that he has simply quoted the words of another journalist?
  Mr. Campbell: He was a member of the Labour Cabinet. One is inclined to take account of the statements made, within a year of leaving office, by such a right hon. Gentleman.
  Besides grappling with this inflationary situation, the new Conservative Government worked out, without delay, changes to improve the combination of regional development measures ; and on 3rd February I announced that the major part of West Central Scotland was to be designated a special development area, including nearly half the working population of Scotland. We have extended to the whole of the Edinburgh area the intermediate status, which the Labour Government had, on a highly arbitrary and unrealistic basis, given only to Leith. No part of Scotland is now without assistance for industrial development.
  The new incentives for development areas include a system of free depreciation which can be carried forward to future years or back to previous years where profits are not made at the beginning ; increases in the rates of building grant ; greater use of the local employment Acts ; and continuance of the 40 per cent. initial allowance for new industrial buildings, which was due to have ended in 1972.
  The new taxation allowance for service industries is especially helpful in Scotland, where service industries have, in recent years, felt acutely the discrimina
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  tion against them. Similarly, the halving of S.E.T. this month is likely to have a more favourable effect in Scotland than in any other part of the country.
  For the new and very large special development area in West Central Scotland, there are additional incentives for new industry. There is the operational grant for eligible wage and salary costs for the first three years for incoming projects. This grant is being increased from 20 per cent. to 30 per cent. Also, rent-free factories can be made available for five years, instead of two years as in the development areas generally. The combination of incentives related directly to employment is more powerful than at any other time.
  I know that some hon. Members opposite hanker for the old investment grants. But they have apparently forgotten that the Estimates Committee, containing a majority of Labour Members, called over two years ago for an investigation into the effectiveness of investment grants, and that the Labour Government of that day duly started such an investigation. The point I ask the House to consider is that, under the previous system, a huge investment grant could be given for a project which had the effect of reducing jobs. The grant was not related to employment and could have haphazard and anomalous effects of that kind.
  Mr. Bruce Millan: Why do not the Government publish the results of the inquiry?
  Mr. Campbell: The inquiry was started under the previous Government. What they did was their affair, but they announced to the House that they had started an inquiry. We came into office having already stated that we would make this change, because we had made our inquiry before we came into office.
  Dr. J. Dickson Mabon: Let us get this absolutely clear. Such a study was commissioned, but it was not published although present Ministers, when they came into office, had this study, and they made this decision before they read the study. Is not that true?
  Mr. Campbell: Naturally, in Opposition, we were not just sitting about waiting until we came into office to see the

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  results of the studies of right hon. and hon. Gentlemen opposite. We had been doing our own work and we stated beforehand that on the information and studies which we had made, we thought that the money for development areas could be used more effectively and tied to jobs by other methods. Having said that before we came to office, we went into it very quickly in our review and announced at the end of October new measures and changes which were in principle on the lines of what was the intention before we came into office.
  Mr. William Hamilton: I was Chairman of the Estimates Committee which made that recommendation. It is true that no research had been done into the effects of investment grants. That recommendation was implemented by the Department which made the inquiry. We would like to know how far the Government's policy has been influenced by the recommendation made by that inquiry and whether the Minister will now publish the results of the inquiry.
  Mr. Campbell: That is an interesting point which I will certainly look into. I have the report of the Estimates Committee. I found it most interesting reading on this point. I have taken my extract from it.
  Mr. Hamilton: It is in the right hon. Gentleman's brief, that is all.
  Mr. Campbell: Not at all. This is something on which I have been working for nearly two years. It has nothing to do with the brief. It is something that I have prepared entirely myself. I remember very well that the hon. Gentleman was Chairman of the Estimates Committee. We have discussed this matter before, across the Floor of the House. He and I are especially interested in this subject. I will follow up what he has asked, but I cannot spend the rest of my speech on that matter.
  There are now powerful and attractive incentives for industry to develop in Scotland, but they will be fully effective only when there is more mobile industry looking for places in which to settle or expand. The incentives must be accompanied by investment confidence and growth. I agreed with the right hon. Gentleman when he said that. The
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  Government's economic policies as a whole are designed to achieve that situation.
  During the past year there has been a limited amount of mobile industry in Britain. At the same time, employers, because of rising costs and falling profit margins, in many cases have been reducing the numbers employed on existing work. This shedding of labour and the lack of growth of the economy have together contributed to the present situation. Without a healthy and expanding national economy it is difficult for the regional economies to grow.
  Besides the general measures which I have mentioned, we have taken a number of specific measures nationally to establish a sound framework for growth. We have made two successive cuts in corporation tax, amounting in all to 5 per cent.; after cutting S.E.T. by half, we shall abolish it altogether by 1973 ; and Bank Rate has been cut. All these measures constitute a strong stimulus to firms throughout the country. As business confidence returns, these measures will be seen to encourage and help to finance industrial expansion.
  Mr. Tam Dalyell: Has the Scottish Office made any serious estimate of what has happened as a result of halving S.E.T.? Are there any figures for that?
  Mr. Campbell: There are a number of factors. A very important factor is that the cost of an average house is likely to be reduced by £50. A number of other factors, for example, inflationary wage settlements, could have the opposite effect. But the cutting of S.E.T., we are told, is the equivalent of £50 off the average price of a house. [HON. MEMBERS : "Who told you?"]. The industry, as well as others.
  One important way in which more growth in our economy can be achieved is by the dynamic effect of entry into the European Economic Community. This is one of the main reasons why the Government are seeking access to that huge market. This can be of immense significance to Scotland in promoting—
  Mr. Alex Eadie Mr. Alex Eadie (Midlothian) rose—
  Mr. Campbell: If the hon. Member will forgive me, I have given way a lot.

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  I will give way to him after I have dealt with the passage about the E.E.C.
  This can be of immense significance to Scotland in promoting the additional investment we need and in producing more mobile industry looking for areas in which to expand. The removal of tariff barriers between the United Kingdom and the Common Market countries would create more favourable conditions for overseas countries to invest in Scotland.
  With the support of industry in Scotland, and through the agency of the Scottish Council, a considerable effort is being made, with Government help, to concentrate and co-ordinate Scottish promotional work abroad. Over recent years one thing has become quite clear and it is more apparent than ever now. That is that many foreign companies, especially American companies are interested in settling in Scotland if we are to be part of the Common Market. But if we do not join, they may decide to settle on the other side of the North Sea in order to be inside that vast consumer market. The stimulus to the British economy as a whole which is likely to accompany membership of the E.E.C. could be of great benefit to Scotland.
  Our regional development measures for attracting new investment to Scotland are in full accord with one of the major objectives of the E.E.C. as stated in the Preamble to its Treaty, namely, to ensure harmonious economic development within member States by reducing the existing disparities between the various regions of those States.
  Moreover, regional policies of the kind which we have for Scotland are being pursued by present members of the E.E.C.—for example, Italy and France. I have myself made a tour of the new steel works at Taranto in the south of Italy ; and further steel works development is now being carried out in that region.
  When considering in the coming weeks the momentous decision to be taken by Britain we should have in mind that the effect of the industrial dynamic is likely to be beneficial to Scotland as it will be to other parts of the country. It is not surprising that the Scottish Council—the right hon. Gentleman was quoting Lord Clydesmuir a good deal earlier this afternoon—supports British entry. So did the
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  Study Group which was set up by the Scottish C.B.I.
  Indeed, the right hon. Member for Kilmarnock (Mr. Ross) himself, when he was Secretary of State two years ago, seemed to be of the same view. In a Written Answer he made this statement :
  "A detailed analysis of the consequences of membership for particular parts of Great Britain is not practicable but the Government are confident that in the long run membership will be of economic advantage to all parts of the United Kingdom."—[OFFICIAL REPORT, 16th July, 1969; Vol. 787, c. 113.]
  Mr. Eadie: Was the right hon. Gentleman in the House earlier this afternoon when the Prime Minister confessed that no regional policies had as yet been worked out by the E.E.C.? Therefore, does he not agree that this has flung open to a considerable extent the question of regional policies inasmuch as, if we pay too high a price to enter, the Government, in allocating financial resources, will not be able to pursue financial policies in the way that the right hon. Gentleman is suggesting to the House?
  Mr. Campbell: I was here earlier and heard that exchange. I was referring to what members of the Community are doing now individually. The fact that they have not finalised their own regional policies as a group together means that we as members can take part in the discussion on and eventual formulation of those policies. I only wish that they had left their fishing policies to be dealt with after our entry, because life would have been made a little easier for us if those policies had been left open until we and others were members and could have done something about them.
  Mr. James Hamilton: The Secretary of State referred to the Scottish Development Council and the C.B.I. Will he tell us now whether both of those bodies are in tune with the Government's policy as regards the departure from investment grants and the move towards free depreciation?
  Mr. Campbell: As I have said before, different industries have different views. There are some industries that have preferred the investment grant system. Obviously capital-intensive industries in some cases benefit from them. Other industries prefer the new system. I have

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  taken account of the different views, but I am not aware of a particular view being stated by either of these bodies as a whole to me. These bodies have been concerned with the major questions of unemployment, what can be done to improve investment confidence, and the measures to be taken to use fully the resources of Scotland.
  I turn now to the question of Upper Clyde Shipbuilders which the right hon. Gentleman mentioned.
  Mr. Robert Maclennan Mr. Robert Maclennan (Caithness and Sutherland) rose—
  Mr. Campbell: I have given way a great deal and I must move on, otherwise I shall take up too much time. [HON. MEMBERS : "Give way."] If the hon. Gentleman wants to talk about the Common Market before I leave that subject, I will give way.
  Mr. Maclennan: The right hon. Gentleman said in his remarks on the subject of the Common Market, quoting my right hon. Friend the Member for Kilmarnock (Mr. Ross), that it was expected that in the long term it would be for the benefit of Scotland. Many people would not dissent from that. What we are concerned about is the short term. Has the right hon. Gentleman noticed today that the investment intentions of industry show the most depressing downturn and the level of production is falling? Is the right hon. Gentleman making the strongest representations to the Chancellor to reflate quickly, because, if he does not, Scotland will not be in a healthy state to withstand any further strains?
  Mr. Campbell: As regards the short term, I believe that if Britain decides to enter the Common Market, and when this becomes clear, this in itself will start the confidence in investment which we look to, because firms which are now waiting to see which way we are to go will start making their plans. So I think that there are good short-term prospects in this. The measures which we have taken already since we have been in government are intended to and are now beginning to have their effect in creating—
  Mr. Lawson: They are not.
  Mr. Campbell: As I explained, it takes time for all measures to come into effect. For example, some of the Budget measures are starting to have effect only this month. Therefore, unfortunately, there is a time lag before such measures can become effective.
  I must turn now to the question of U.C.S., which the right hon. Gentleman mentioned, because the right hon. Gentleman has again made the ludicrous proposition that U.C.S. has gone into liquidation as a result of a deliberate Government plan over several months. The right hon. Gentleman is talking utter nonsense. I want to make that quite clear. I am glad to note that the Press realise now that the suggestion is ludicrous.
  That U.C.S. should have gone into liquidation now could only add to the troubles and burdens of the Government. It is the last thing that we could have wished. It is happening in an area which has special problems, as we have recognised by designating it as a special development area.
  Since U.C.S. was brought into existence by the right hon. Member for Bristol, South-East (Mr. Benn), whom I am glad to see here, when he was Minister of Technology, it has been in difficulties. It has had a succession of crises when it has come to the Government for financial help. Between November and February last such a crisis occurred, but it did not receive publicity, and publicity would not have helped U.C.S. The Government were able to assist U.C.S. at that time with the detachment of Yarrow's and by agreeing to a substantial writing down of its capital.
  Mr. Dick Douglas: Never completed.
  Mr. Campbell: It was agreed at that time. U.C.S. then said that it was out of the wood and could see a viable future.
  I have with me the U.C.S. magazine of March of this year. It carries optimistic comments such as those we were also reading in the Press in March and April. I was glad that all seemed to be well again. There was in that magazine the following passage written by its managing director :
  "The last Government made it quite clear that we could expect no further aid, and the present Government have made it equally clear.

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  We must stand on our own feet, and through our own efforts go forward."
  That was last March.
  Later, when he was asked in a television interview what had gone wrong, the managing director said this :
  "I think it is inherent from the formation of the group. The group was formed really with insufficient working capital."
  When the last crisis blew up so quickly early last month, it was clearly a shock to the board of U.C.S. themselves. As I stated in the debate on 15th June, it was the result of an urgent financial review which they had arranged. The board clearly did not themselves know their true financial position until they received the report of their special review on 7th June.
  It has been suggested that the Government should have known, even if U.C.S. did not, because of the S.I.B. director on the board. Let me here quote from the evidence given by the right hon. Member for Bristol, South-East before the Select Committee on Scottish Affairs on 24th June, 1969. The right hon. Gentleman was dealing with the question of communication between U.C.S. and the Government. He said this :
  "In the case of Mr. McKenzie, he has been the S.I.B. director dealing with the S.I.B. But it has never been our objective that we should deal with the company through the government directors. The government directors are directors of the company. They have special responsibilities which are understood. But I think it would completely undermine the authority of the Chairman if he felt that one member of his Board was dealing with the Government or with the S.I.B. without his being consulted. Therefore, we have always dealt, in so far as it was necessary to do so, directly with the Chairman."
  Mr. Anthony Wedgwood Benn: The right hon. Gentleman quotes from an answer which I gave to the Committee in response to a question about whether I dealt with the company through the Government director. I gave the absolutely correct answer, and that is what he read. What the right hon. Gentleman has not dealt with in that connection is whether it is the duty of the Government director to inform the Government of circumstances which arise. Of course, Mr. Mckenzie so informed me at earlier stages. It is inconceivable that the Government did not know what was happening, and they were, in fact, following a plan worked out by the hon.
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  Member for Cirencester and Tewkesbury (Mr. Ridley) in December, 1969.
  Mr. Campbell: I was quoting the right hon. Gentleman simply to show that he had stated to the Select Committee the normal means of communication, which were the normal means of communication also for this Government—Minister to chairman and board. I agree, also, that there was nothing to prevent the S.I.B. director expressing his personal view if he had to. But what I am pointing out is that it was perfectly clear that the board of U.C.S. itself was not aware of its financial position. It instituted the financial review, at the instigation of the S.I.B. director, and it was not until the result of that was produced that it suddenly realised what the company's position was. I think that the board was making its optimistic remarks in all good faith in March, April and May. I believe that it really thought that it was out of the wood, until it suddenly had the further review and found that the company was in deeper trouble than before.
  Mr. Douglas: I realise that there have been a number of interruptions, but there is an important point to be made here. The essence of the association between the S.I.B. director and the Government has not fully been unfolded, because the initial impetus to go into liquidation goes back to October, 1970, when the S.I.B. director communicated directly with the Department and gave a very pessimistic impression to the Department of the company's future. In so far as that led the present Government to withhold the underwriting of credit, that precipitated the crisis. The Government are responsible for directly communicating with the S.I.B. director and, indeed, for overruling and over-riding the views of the S.I.B. on credits at that time.
  Mr. Campbell: The S.I.B. director was then doing exactly what the right hon. Member for Bristol, South-East (Mr. Benn) said he was free to do, and the crisis which I have just described was overcome. The Government were able to help by the detachment of Yarrow and by the substantial writing down of capital. Upper Clyde Shipbuilders was itself quite satisfied that it was out of the crisis and out of the wood ; it thought that it was in a better position than ever.

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  I am glad to correct that misapprehension, and I must now get on.
  In the same proceedings of the Select Committee, on the question of the future possible liquidation of U.C.S., the right hon. Member for Bristol, South-East said, on 24th June. 1969 :
  "… we have never taken the view—it would be quite wrong to take the view—that at whatever price U.C.S. or any other company in the shipbuilding industry would be kept alive ".
  I quote that because it is on the record, it is quite understandable, and the Select Committee heard the right hon. Gentleman say it. In the light of what he has done and said two years later, I think it right that the right hon. Gentleman should recall what he said at that time.
  Mr. Benn: The right hon. Gentleman quite properly quotes what I said, that at no stage were we prepared to support any company regardless of its prospects of viability. The criticism which he has to face is that at higher cost than the cost of support he is letting U.C.S. go into liquidation. He is paying a higher price for it than giving the company the resources to allow it to move into viability. That is the charge which he must face, and he has made no attempt to answer it.
  Mr. Campbell: That is the point to which I am now coming, and I am obliged to the right hon. Gentleman for raising it. I must make clear again that, last month, it was not just a loan of £6 million which was needed. The board of U.C.S. said that it hoped that the company could become solvent again if the Government were prepared to provide £5 million to £6 million as grant or equity, not as loan, and if its creditors would accept 33p in the £, which would have meant a further £5 million or so to it. But even then there was, unfortunately, no clear prospect of when the company could become solvent again, if at all. A great deal more than £6 million was involved.
  I have said that before, but there was so much noise in the Chamber at the time that, unless hon. Members looked at HANSARD the next day—and some of it may have been missed—they might not have had the point clear, and I am glad to make it absolutely clear now. It was not just a matter of £6 million.
  Mr. Benn: How does the right hon. Gentleman define solvency? The definition given by the Secretary of State for Trade and Industry was not one which has ever been applied in business in any similar circumstances.
  Mr. Campbell: I think that the chairman of U.C.S. and my right hon. Friend were themselves in doubt about what they were meaning by that. But I cannot pursue the details of it now. I think that the right hon. Gentleman has got my point. The £6 million has been bandied about as though that was all that was required. Unfortunately, it was a great deal more than that.
  The Government are determined to bring about a successful reconstruction on the Upper Clyde. They are providing funds now to cover pay, including holiday pay. I am myself meeting the group of advisers for discussions later this week. Last week, I had the benefit of discussions with the provisional liquidator, Mr. Robert Courtney Smith, who, I believe, has the confidence of everyone concerned. It is important now to concentrate on the future.
  I turn now to Hunterston, and the question raised by the right hon. Member for Kilmarnock, to draw attention again to its importance for the development of the West of Scotland. It is true, as he said, that, over two years ago, on 7th July, 1969, I initiated a debate in the House in Supply time on the importance of the Firth of Clyde and the unique facility of deep-water sheltered berths there. My hon. Friends and I drew attention to these and other assets, and their particular importance for the steel industry, besides providing a basis for a new industrial complex in Ayrshire.
  I supported the interim report of the group working on Oceanspan during that debate, before the Oceanspan Report itself had come out. Sir William Lithgow and Professor Nicoll were working on the matter but had not yet produced a report, but they put out an interim report which received my full support. Soon after I came into office, I was presented with the report of a public planning inquiry. My main decisions were affirmative, not negative. I lost no time in taking the planning decisions to allow a deep-water port and an ore terminal and, by zoning the land for industry, to leave the way open

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  for a modern integrated steel works in due course.
  These decisions were announced last December, and thus the potential and availability were proclaimed in due time. The bodies and the corporations concerned are now working out the proposals.
  We should not overlook, either, the way in which defence establishments can use our resources in Scotland. Besides contributing towards our country's defence, these establishments provide a considerable number of jobs of different kinds. The rocket range in the Hebrides and other establishments, such as the Faslane base, have shown that these establishments can usefully contribute to our Scottish economy.
  I have some experience of this myself as there are two Service airfields in my own constituency which play an important part there. Although one of them has had what were at the time the noisiest, indeed, the most deafening aircraft in the world, my constituents were wise enough not to object, since they knew what was good for the area's economy. The complaints have come only recently and stem from anxiety that one of the stations may be somewhat reduced.
  Mr. John Brewis: My right hon. Friend will be aware that in my constituency we have considerable experience of defence establishments extending over about 30 years, and he will know that some establishments are much worse than others.
  Mr. Campbell: I am aware of that, but I think that right hon. and hon. Members on boh sides recognise that there is practically no establishment, industrial or defence, which does not, when it arrives, cause damage to someone, whether through smell, noise or visual effect. Unfortunately, there are such disadvantages. What we must do is try to steer what will be helpful and useful developments to the most appropriate places and the places where they are needed.
  I believe that all informed observers of the siutation which I have described agree that, besides economic measures, including regional development incentives, a public works programme could make a significant contribution towards alleviating unemployment in the coming months. The Government have been con-
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  sidering this, and we have been able to identify such work, over a variety of fields, which can usefully be undertaken.
  I can now announce a major new programme in this field, which can be divided into two schemes, to increase expenditure on public works in Scotland up to March, 1973. The first is the one about which I informed the Scottish Grand Committee this morning. I propose to authorise a special roads scheme for Scotland amounting to £8 million in the current financial year and the next. It will consist of £2 million of additional expenditure on trunk roads and £6 million on other roads, towards which special grants will be available in Scotland only.
  Second, there are works which can be carried out wihout any special grant arrangements. My Departments will consider with the local authorities and other bodies directly responsible further work of a capital nature, beyond what is already programmed, which they could undertake and substantially complete by March, 1973. This could include work on schools and other educational buildings, on hospitals, in agriculture and fisheries, and for social work, police, fire, environmental and other local authority services. I have provisionally estimated that all the possibilities from the two schemes could between them yield a total of about £33 million of additional work.
  I intend to stimulate the maximum possible amount of work to be done in the remainder of the current financial year, so consultations will be pressed ahead with all possible speed. We hope to get some work approved and started even before those consultations are finished. For example, in education we can give immediate approval to a substantial number of improvement and replacement projects which could not be accommodated within normal programmes.
  Mr. Galbraith: I am very interested in my right hon. Friend's helpful announcement, but he left out a very important aspect. Since industry pollutes, could not the grants be given particularly for anti-pollution work, and thus give us the best of both worlds?
  Mr. Campbell: I will certainly bear my hon. Friend's point in mind in the consultations.
  In addition, where we can provide a direct stimulus to the Scottish economy

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  we have not hesitated to do so. The special house improvement grants for the next few years, proposed in legislation now before the House, are intended to encourage more work of a kind which, in addition to its value in providing better housing conditions, will provide work quickly for the construction industry.
  We have been looking very carefully at housing finance. The Government's housing policies were fully discussed in the Scottish Grand Committee recently. Our proposals for housing finance for Scotland will be set out in a White Paper to be published tomorrow. The reforms proposed are somewhat different from those proposed for England and Wales in the White Paper published today. The Scottish White Paper will end some unavoidable uncertainty, and provide for progress in housing in both the private and the public sector.
  Dr. Dickson Mabon: The right hon. Gentleman has referred to house improvement grants. Let us get the figure of £33 million clear—the £8 million on roads and the other £25 million. Does it include the house improvement grants scheme? Is it entirely additional to programmes already announced?
  Mr. Campbell: It is entirely additional to the programme I have announced, to the special grants included in the Bill which is being discussed on the Floor of the House.
  Dr. Mabon: Do I take it that £8 million is on roads, and is divided into two sections, part of which is financed by the local authorities, and that £25 million goes to local authorities? May we have more detail on how that will be allocated between central and local government expenditure?
  Mr. Campbell: I cannot give further details now. We are going into consultions with the local authorities on how it can be used, and we will provide the House with the information at the earliest opportunity. I wanted today to announce the broad lines of the programme.
  We have also recently made arrangements to assist Glasgow to tackle some very real problems. These will produce further work for the construction industry. First, we are proceeding to
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  establish a new community at Stonehouse in Lanarkshire, with an initial target of about 10,000 houses. Second, the Scottish Special Housing Association is to undertake the construction of about 7,000 additional houses for families coming out of Glasgow. Third, up to £1 million a year will be provided for five years to assist the Glasgow Corporation to improve the general environment.
  In economic matters there is always a considerable time gap between the introduction of measures and their showing results. But there are some encouraging signs. Industrial development certificate approvals, both for the West Central Scotland S.D.A. and for Scotland as a whole, have turned upwards in the first six months of this year. Though this is too short a period for any firm judgment to be made, this is encouraging after the downward trend in recent years.
  Another very significant and encouraging factor is that there are indications that the discovery of oil in the North Sea off the Scottish coast will prove a commercial proposition.
  Mr. Ross: Could the right hon. Gentleman give us the figures for the I.D.C.s?
  Mr. Campbell: My right hon. Friend the Minister for Trade will provide figures later when he winds up the debate. I said that there were encouraging signs, and in a speech that is already too long, I am giving general indications. The particular points raised will be dealt with later.
  If B.P.'s tentative plans for bringing oil ashore from its Forties field materialise, Scotland could benefit considerably. If the flow of oil is up to expectations, it could provide a secure base for the planned expansion of the Grangemouth refinery to 18 million tons a year, making it one of the largest in Europe.
  Already there are signs that the exploration activity off the North-East coast is generating activity in that area of Scotland, where shore installations, pipeline construction, servicing facilities, housing and other provision for oil industry personel would be required. The North-East Scotland Development Authority has shown admirable initiative in bringing together the oil companies and the local interests concerned at an early stage.

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  It is also encouraging to note that Scottish capital is beginning to participate in the groups applying for licences. The recent Government announcement inviting applications for licences for the exploration of large new areas included for the first time 16 blocks in very promising areas, including Scottish waters, for which competitive tenders are invited. This is expected to stimulate exploration activities still further. My Department will be actively engaged in support of these promising developments.
  I have made it clear that we have been facing a difficult situation in Scotland. In the relatively short time we have been in office, we have taken a number of major steps to put the situation right, both centrally and regionally. My announcement today of a large new public works programme is another measure to help, and is designed for the immediate future. But putting the situation right will take time. It is essential to discern the opportunities available in Scotland and for Scotland, as well as the special problems which we face. It is our firm purpose as a Government to see Scotland clearly in her traditional place among the leading industrial nations.
  Several Hon. Members Several Hon. Members rose—
  Mr. Speaker: Order. The debate began at seven minutes past four. We have had two speeches in about an hour and a half. I am stating a fact and not making a complaint. Over 20 hon. Members wish to speak and we have about 3½ hours before the Front Benches will want to intervene again.
  5.39 p.m.
  Mrs. Judith Hart: The first thing to be said in commenting on the Secretary of State's speech is that he seems to under-estimate the degree to which he is in considerable political trouble. I have never heard a more complacent speech in a situation like the present from the Government benches. We see that the right hon. Gentleman is in the more serious trouble when we look back at his predecessors. I recall the period during the 1950s and early 1960s when his predecessors, including the present Minister for Trade, were in office, and the worst unemployment situation that arose during that time, when in the middle of a rather difficult winter
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  Scotland had a figure of unemployed which reached the 120,000 mark. We remember the tremendous distress which even the Government of that time were feeling and which they talked about.
  The right hon. Gentleman may refer in the Amendment to "regrettably high unemployment", but we have heard hardly a word of regret from him today. On the contrary, we have heard a good deal of complacency and the kind of promises that we cannot take seriously any more in the light of a year's experience of this Government. We have heard little of any real sense of regret or of any real sense of the urgency which has arisen in the Scottish economic situation in the 13 months that he has been Secretary of State.
  The period of the 1959–64 Conservative Government was bad enough for Scotland—a time of Conservative fuel policy and pit closures, of Conservative transport policy and Beeching rail closures—but it was a time of Conservative innocence compared with what has been deliberately inflicted on the Scottish economy in the past year. We are all fully aware of the figures. The right hon. Gentleman, the Government and the people of Scotland are facing the present level of unemployment against the prospect of much more to come and of unknown risks to come which we cannot calculate. Rolls-Royce and U.C.S. are still at risk. More redundancies have been announced and more are in the pipeline every week. Soon the school leavers will be added to the ranks of the unemployed. And there is next winter to come.
  In his Amendment and in his speech today, the right hon. Gentleman not only admits but takes some pride in recognising that the "regrettable unemployment" is a direct consequence of the Government's deflationary policies. That is the factor which we have never heard coming from a Conservative Government before. They admit that it is not just their failure to take necessary action but a deliberate act of policy to create deflation, whatever its effect upon those parts of Britain which urgently need more employment rather than a taste of Tory deflation. He regrets the consequences, but what we want to know—and he has not told us—is what kind of an argument he is putting up in the Cabinet. Is he

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  arguing for or against deflationary policies? Is he arguing that reflation is overdue? I suspect, from what he said today, which went a little beyond the natural Cabinet loyalty of a Secretary of State for Scotland towards his economic colleagues in the Cabinet, that he is one of the firm believers that deflation has not gone far enough, that he is not arguing inside the Cabinet for the economic policies which are essential if we are to have any kind of upturn in employment in Scotland.
  The right hon. Gentleman seems to be limiting himself to fighting for his programme of public works. Of course, it is splendid to hear that at least he is converted to Keynesianism, even if he is not converted yet to anything which takes us beyond that point. He is at least ready to admit that there can be Government intervention, even if it is only in the Keynesian sense of putting men to work on roads and building. He suggested that this programme will be a massive contribution to resolving the Scottish problem of unemployment this winter.
  He should remember, however, that in a public works or building programme two kinds of people are required. First, highly skilled building workers are needed. That will be a good thing for the building industry and to the extent that there are skilled building workers out of work, this will be good enough. Secondly, large numbers of unskilled workers are unemployed, and they are needed in such a programme. But a high proportion of highly skilled craftsmen from other industries are unemployed and the right hon. Gentleman's public works programme can offer little to them. The latest figures from the area of my constituency—Lanark—show that 47 per cent. of the unemployed in the Lanark employment exchange area are in the skilled category, and public works programmes are not the kind of thing which they are either anxious to take or which they should be offered by a responsible Government seeking to use in the community the resources of skill which they possess.
  The trouble with the right hon. Gentleman and his Cabinet colleagues is that they are prisoners of their own political philosophy in this matter. In their elec-
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  tion manifesto, on the general principle governing these matters, the Conservatives said that they rejected the detailed interventionism of Socialism. But what Scotland is proving goes beyond this, with 121,000 unemployed and the prospects of having more next winter, and goes beyond even the fact that, in the last year or two of the Labour Government, we did not reduce unemployment as much as we would have liked. What is being proved is the total failure of a free market economy to exploit resources and provide full employment, even assisted by the financial incentives of regional policies—certainly those of the present Government.
  The right hon. Gentleman implied—and, indeed, said when he offered us his remarks about entry into the E.E.C.—that growth is an essential precondition of economic health in Scotland. Of course that is so. But I question his assumption that entry is a recipe for that kind of economic growth. We can more properly debate this matter next week, but the belief is growing that the possible cost to our balance of payments will be so great that entry into the E.E.C. will be a recipe for minus growth rather than higher growth. But that is a matter on which there are differing opinions. The essential difference between the rate of growth of the last two or three years of the Labour Government, which was not as high as anyone would have liked to see, and the rate of growth today, which is even lower and may this year even be minus growth, judging by investment trends, is that we were establishing a sound balance of payments surplus as a basis for growth. The present Government inherited that sound basis and they have no excuse for lack of growth. Nevertheless, they make the excuse that they have to keep wages down.
  When the right hon. Gentleman talks about the inflationary process of a year ago, what he is saying is that the Government decided on low growth, even if it means stagnation and minus growth, in order to keep the standard of living of the working people lower, because to do otherwise would be incompatible with their other economic and social objectives. Scotland is suffering from deliberate deflation caused by a political philosophy which takes that point of view.

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  It is no good the Secretary of State talking about "special measures" and "creating a sound framework for dynamic growth" if he is not prepared to pursue the kind of policies which are the only answer in this situation. The first essential for Scotland, therefore, is a programme of reflation, with the recognition that, in order to prevent the spiral of wages and prices, a prices and incomes policy is necessary. If that is to be achieved, it can be done only on the basis of a contract with the trade unions, and that will be achieved only on the basis of their understanding that the Government, pursuing a prices and incomes policy, are also pursuing social objectives that they wish to see accomplished. I do not think that the Conservative Government—and this is their dilemma—can ever enter into that kind of social contract with the unions.
  Within the context of growth, there are special regional factors required which need to go far beyond anything which we have developed over the last 10 or 20 years. We need the right kind of incentives. I endorse everything that my right hon. Friend the Member for Kilmarnock (Mr. Ross) said about the desirability of investment grants rather than allowances and about the regional employment premium. We need the right kind of financial incentives, and very tough and effective industrial development certificate control. One question which the Government will have to answer in next week's debate is how they can reconcile a tough I.D.C. policy, which is a pre-condition of regional development, with the free flow of capital involved in the Treaty of Rome if we go into the Common Market. Much more stress should be laid on preferential lending rates and preferential bank rates. We have had those from time to time in the Scottish economy. They can be one of the most effective measures in providing finance for industrial development within Scotland.
  We also need new emphases in public ownership, and again they go in exactly the reverse direction to that which the Government are likely to pursue. Far from hiving off and preventing the diversification of nationalised industies, we need a deliberate policy of not only encouraging but directing them to diversify into the regions where employment
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  is needed. This is the one sector where Government intervention can be guaranteed to work because the Government control the financial and marketing forces involved. I fear that the Conservative Government will never be able to find the right answer within their philosophy. For example, I should like the National Coal Board in Scotland to go into system building. This matter was under discussion when I was in the Scottish Office. This would be perfectly logical. We could have done with a sound, Scottish-based system building firm in Scotland. The Coal Board could have filled this rôle. I should like new public enterprises to be created—and this has been mooted in a number of Labour Party policy statements—in other directions as well as by diversifying the nationalised industries. All of these developments are possible only within a framework of growth.
  I should have liked to make a number of constituency points. I will merely mention that, as the Secretary of State knows, I have been having discussions with the Secretary of State for Trade and Industry about the exclusion of Lanark from the special development area policy. I still have hopes that we shall reach a satisfactory conclusion on that matter, so I will not burden the House with it.
  The Secretary of State for Scotland does not seem to realise the degree of his own political difficulty. He does not seem to understand that he is creating for himself the reputation of a Secretary of State who has done more damage to Scotland than any other since the war. The right answers are so diametrically opposed to the policies which he and his colleagues are pursuing that the question is not how long must we bear the burden of increasing unemployment in Scotland but how long must we bear the burden of the Secretary of State and his colleagues?
  5.55 p.m.
  Mr. Michael Clark Hutchison: There is no doubt that at present and for some years past unemployment in Scotland has been greater than it should have been and that prosperity has not been all that it should have been. Since I have been a Member of the House, Governments have attempted various remedies, but they have never had final and lasting success.

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  I find it difficult to pinpoint what is wrong and why we should not and have not done better over the years. I do not think it is anything to do with the national character. We are an able people with plenty of skills. I do not think it is anything to do with the political set-up or political beliefs. It is nothing to do with being workshy. If anything, the Scots are more hardworking than most people in the world. I do not think the education system can be blamed. We do not lack basic self-confidence.
  Fortunately, many areas are reasonably prosperous and many firms are doing quite well, particularly those dealing with finance and insurance and the banks ; they should not be overlooked. I am inclined to think that the root cause in some industries and firms has been bad management. The story of Upper Clyde Shipbuilders is very sad, and there have been faults on both sides. I do not think that the management can be entirely acquitted. However, this does not provide us with an answer or with a line of action for the future.
  I have not had a great deal to do with Scottish industry over the years as my work before I became a Member lay elsewhere. But not long ago—and here I must declare my interest—I became an outside director of General Time Ltd., the makers of Westclox and other brands of clock, whose factory is in Dumbarton. The factory is a subsidiary of an American organisation, but we work entirely on our own and employ 900 people, half of whom are women. The executive management is first class and the workpeople are excellent. We export on a considerable scale to South Africa, Australia and elsewhere. The Americans have such confidence in this company that they have given up operating the sales to Europe, including the Common Market, and given the responsibility to us in Scotland. The firm is expanding.
  I do not know what lessons can be drawn from that. It has nothing to do with me because I have been with the company for only a short time. But if this organisation can do the job, why cannot others? Incidentally, the Americans decided that we should sell to Europe long before any decision on the Common Market was made. We are not interested
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  in the Common Market. We can beat the Common Market countries, whatever they do.
  If I were asked why this company was in a reasonably happy position, I should say that it was because people have confidence in its management. If the workpeople have complaints or grouses, they know that they will get a square deal. The technical management is highly intelligent, and great care is taken to tell all employees exactly why things happen and what is proposed. People like to know what is going on in an organisation, and I think that in that respect relations are often very poor.
  I am sure that there are many companies in Scotland which are equally good or perhaps better than the company to which I have referred. I hope that managements will always try to be imaginative and efficient.
  Mr. James Hamilton: This is an important point which I have made several times. Does the hon. Gentleman agree that, where there are good industrial relations, there are good communications from boardroom level to shop floor level? Does he further agree that the Industrial Relations Bill could prove to be a handicap to companies of that kind?
  Mr. Clark Hutchison: I do not know enough about the Industrial Relations Bill to know all its provisions or how it will work. I know only that in the company in which I am interested we have good relations from the board to the lowest rung on the ladder.
  I commend my right hon. Friend the Secretary of State for the measures he has taken for the well-being of our country. He has not been sparing in his hard work and devotion to this job. Throughout the years we have been playing about with all sorts of remedies and devices to improve the position of Scotland. We have had depreciation allowances, Local Employment Acts, development area status, and so on. Attempts have been made to meet the difficulties and to recognise our geographical position and our distance from large markets. But I often wonder whether we should not scrap the whole lot and go over to an entirely new system of tax differentials.
  For a long time I have believed that if Scotland had a lower rate of income

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  tax and company tax than the rest of the Kingdom she would prosper. This would not be difficult to administer. I know the Treasury would bristle at the idea, but surely the Treasury can be overruled. I have in mind that people who are genuinely resident in Scotland for the major part of the year, and companies which produce 80 per cent. of their production in Scotland, should pay a lower rate of tax. I commend this system, which would give a tremendous boost to Scotland, would be easy to operate and would be easy to defend.
  I suspect that my right hon. Friend the Member for Argyll (Mr. Noble) is not averse to this idea, but whether my right hon. Friend the Secretary of State will be able to carry the day, I do not know. I may be told that this system would not be possible if we went into the E.E.C.
  Mr. James Hamilton: Hear, hear.
  Mr. Clark Hutchison: My reply to that is that I do not want to go into the E.E.C. Such action in my view would be detrimental to industry in Scotland and to agriculture and fisheries. In any event, I much prefer that we should wrestle with our own problems in our own way and have them under our own control. Entering the Market would take away our freedom of manoeuvre and power of decision, and so from Scotland's angle, quite apart from the United Kingdom's angle, I would oppose it.
  I have endeavoured briefly to put forward some ideas which I hope my right hon. Friend will look at seriously.
  6.4 p.m.
  Mr. Ian Campbell: I perhaps go with the hon. Member for Edinburgh, South (Mr. Clark Hutchison) on the Common Market, and I entirely endorse the remarks he has directed to the Westclox factory which is in my constituency. I know of the excellent relationship that exists. The factory has a 100 per cent. union shop, and this is perhaps relevant to the intervention of my hon. Friend the Member for Bothwell (Mr. James Hamilton).
  I should like to speak about the closure of the Plessey factory in Alexandria. The hon. Member for Edinburgh, South was speaking about the good industrial relations in the Westclox factory, but just
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  across the way in the Plessey factory the shop stewards were called together two hours before they went on their summer holidays and told that the place would close at the end of August. This is not the best way to conduct industrial relations. I want to speak of Plessey not because of the high unemployment—rising to one in eight males unemployed—which will increase because of the closure, but because people of all shades of political and industrial opinion are worried about the way in which the Plessey closure came about.
  Six months ago the factory was a Government factory. My right hon. Friend the Member for Kilmarnock (Mr. Ross) explained the trouble to which the Labour Government went when he was in office to try to get new work into this Royal Naval torpedo factory. It is looked upon locally as a public scandal that a firm which was given many incentives to come into the area should, within six months, disappear. We know that the Government's policy is non-interference in industry, but during the last year there has been interference with Rolls-Royce, which was said to be because of defence. Not long ago there was the hiving-off of Yarrow from U.C.S.—this, again, is the defence section of U.C.S. Had it not been for the reaction of the work people, public opinion and Parliament to the announcement of the liquidation of U.C.S., the Government would not have stepped in so quickly to do something about it.
  Plessey was born of Government involvement, but the previous Government's baby is being treated by this Government very much like a step-bairn. I will briefly run over the history of the firm and how the tax-over came about. About 20 months ago the R.N.T.F. was being set up to produce an under-water missile. A large new clean area had been established in the factory—one of the finest in the country—and new machine tools had been ordered. Unfortunately, there were some bugs in the design of the torpedo which could not be ironed out, so work had to be stopped. The Government found the firm Plessey, which was prepared to take over this large factory. It fitted the specification of a growth-type firm, able to take over the machining side, use existing labour in the large machine shops within the factory. It set up a numerical control section, which

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  was taken over from Ferranti of Dalkeith, together with many of the Dalkeith technical people. Now we see what has happened to this Scottish product in a new growth industry.
  An interesting point about the start of the operation in Alexandria was that the Plessey operation was going on hand-in-hand with the run-down of the torpedo work. The torpedo work came under the restrictions of the Official Secrets Act, but the factory was divided into units with different firms working within the same building.
  On 20th July, 1970 the Under-Secretary of State for Trade and Industry, in reply to a Question I asked about Plessey and the employment situation, said that the firm intended by the end of 1970 to employ 500 people and at the end of 1971 to employ 1,000 people. The company advertised locally for labour and said that its ultimate aim was to have 2,000 to 3,000 people employed. It will be realised what a blow it has been to the area that this factory is to be closed.
  The company's Press release on the closure mentioned three significant facts. First, it said :
  "This reduction in demand—which has occurred rapidly since the end of 1970—is due to the effects on industrial investment of cost inflation and the general economy, both in the United Kingdom and internationally."
  We on this side of the House feel that one of the reasons for the fall-off in the machine tool industry has been the change in Government policy and investment grants. Anybody with any connections with industry will realise that this is very much the case. Because of this change in Government policy, people are not buying equipment.
  The Press release also stated :
  "… Plessey has reluctantly decided that it is no longer possible to support on an economically viable basis the supplementary numerical control operations which were started in Scotland last year, when market forecasts still indicated a possibility of expansion."
  The hon. Member for Banff (Mr. W. H. K. Baker) said in the Scottish Grand Committee this morning that it was impossible that the change in Government could have led to a changed situation in industry since the present Government have been in office for only a year. But
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  the Press release shows that Plessey at the end of 1970 thought that its economic trends were on the right lines, but its production has fallen so quickly since then that the company has had to close the business.
  My right hon. Friend the Member for Kilmarnock (Mr. Ross) has reminded us that the company has been sending work south. On that point the Press release said :
  "The company, therefore, very much regrets it has no alternative but to cease operations at the Argyll Works. Alexandria, Scotland, in order to maximise and safeguard its main resources in numerical control which have been firmly established in the South of England …"
  This is all too often the story when a firm has establishments in areas other than Scotland.
  When the closure was announced, I wrote to the Secretary of State for Trade and Industry and put certain points to him. I should like to put those matters on record since they are worrying the unions and other people in the area. Inducements were offered to the firm to go to Alexandria. The normal inducements could not be offered because the equipment was already in existence. One point that should be made clear relates to the terms of sale and the inducements which were offered to Messrs. Plessey by the previous Government.
  In lieu of grants for equipment, what was the price paid by Plessey? This was a Government asset which was being set aside, and the job was being offered to this firm on the cheap. I should like to know what is the situation now that the firm has decided not to carry out its obligations. Certain Government contracts for torpedo work were being carried out in Alexandria, and I should also like to know what steps are being taken to transfer this work elsewhere, and whether it is to go south of the border.
  A most important point on which we should like a clear answer relates to the decision about reacquiring these premises. It is not just a matter of negotiating a price with Plessey. It must be made clear that the Government should take over this asset on the terms of sale which were offered to the firm ; otherwise this Government asset will be lost and the firm may make a profit out of a situation which has arisen because a

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  defence project involving the R.N.T.F. has been ended.
  I have already raised the point with the Government on a previous occasion when part of the Plessey works was being closed. I received a reply from the Under-Secretary of State for Development at the Scottish Office, the hon. Member for Ayr (Mr. Younger), who I find very helpful in giving advice on these matters. The hon. Gentleman said in his reply that the Government were not prepared to take over these premises mainly because three advance factories are being constructed in Clydebank at this moment. I hope that when these factories are completed they will soon find tenants, but the people in Alexandria in the Vale of Leven will now have to find work in the area.
  This is a close-knit industrial community and the people feel that they should be able to find work in the vicinity. Even though many workers travel to Singer's and John Brown's premises in Clydebank, work is needed in Alexandria itself. The Government should look again at acquiring these premises so that they can let them, with all the benefits of the special development area which the Government stress in their Amendments. It may be said that this large factory does not need to be re-occupied. I would point out that it is a factory of some 500,000 square feet, and it would be a blot on the landscape if this large industrial complex were left unused in the middle of the Vale of Leven.
  Governments do not change very much in their attitudes. I remember some years ago when the firm of Denny in Dumbarton was to be closed and we took a deputation to see the then Minister of State, Lord Craigton. Lord Craigton told the deputation "Why worry about having industry in Dumbarton? Dumbarton is a pleasant little place—why not just become a commuter community?" This advice was firmly rejected because obviously an industrial community would never wish to become a purely commuter community.
  Last week at Question Time the Prime Minister said that his Ministers went out of their way to see deputations. I wish to point out that on 27th May I wrote to the Secretary of State for Trade and
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  Industry to ask whether he would see a deputation. The answer I received was as follows :
  "… I do not think there would be anything to be gained by seeing a deputation to go over the ground again."
  We had not even been over any ground on that occasion and we feel that in the present circumstances, since this is a Government factory, we have a stronger case than ever to meet the Minister.
  The hon. Gentleman's last sentence was :
  "We shall be keeping a close watch on developments."
  That letter was dated 30th June, 1971. On 1st July, I received a phone call from the Provost of Dumbarton saying that the factory was closing. It is small wonder that the people of Scotland are so anxious about our trading and industrial situation, when Government Departments keep that kind of close watch on developments such as this.
  6.20 p.m.
  Mr. Patrick Wolrige-Gordon: The situation we are debating today is extremely serious. The present unemployment position is the worst in Scotland since the war. That is true in terms of numbers. But numbers are not the whole point. Unemployment is bad for those unemployed, be they 9, 90 or 900, and in my view we want a national mobilisation for unemployment on the same scale and carried out with the same individual care as a regiment at war gives to those who need to be taken to a place of safety.
  Certainly the Government have announced a major contribution today, with £8 million to be spent on an extended road programme, £33 million on additional works, special house improvement grants and special assistance to Glasgow. But there is a limit to what the Government can do, and I say that without regret because if the Government were able to solve the unemployment problem on their own they would be all powerful, and all the evidence suggests that the more powerful that a Government gets the more inadequate they become, irrevocably limited by the slenderness of their own human resources. Moreover, the limit on their activity imposed by a mixed economy helps to underline the fact that unemployment is everyone's problem and

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  not just that of the unemployed or of the Government alone.
  I have been very struck by the number of people discussing the situation, especially in this House, who seem to think that the Scottish problem is immutable. I do not believe that. I have the greatest faith in the Scottish people. However, in many areas of British life there is a kind of prejudice that somehow, somewhere, someone else owes us a living. It has become almost an article of faith in Britain that one should live on the "get" and not on the "give", and that if one tries to live on the "give" one will be knocked out. I understand that feeling. However, with that philosophy, unemployment is inevitable, since no one cares about what happens to the next person in the queue.
  Conversely, if we decided to live on the "give" and really shifted our production, our services and our way of operating, a new lift would be given to the country, to the economy and to our people. We in this House should try to encourage that kind of approach, because it is all too often a factor which is sadly missing. Often in this House, inevitably, events are interpreted in the narrow terms of party advantage, and one is liable to be told that any kind of change of the sort that I have suggested is impossible while the party opposite pursue its reactionary policies, whether they are to the Left or to the Right.
  I disagree entirely. The great advantage of a free country is that the individual does not need to wait for the Government. There are a great many Scotsmen and women who have formed and are running successful enterprises which, to a greater or less degree, provide employment. There are people who take responsibility and try to make a practical contribution to solving the problem. Obviously the need is to multiply the number of such people. Public works are a necessary palliative of the present crisis, but the future strength of the Scottish economy depends on the extent, variety and number of its roots.
  Mr. James Hamilton: The hon. Gentleman talks about the Scottish economy and about Scottish investment. Is not it true that there is a reluctance on the part of Scottish investors to invest
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  in Scotland? Then the hon. Gentleman talks about the workers of this country. However, even in his own constituency General Motors are operating, and that company will tell the hon. Gentleman about the finest workers in the country.
  Mr. Wolrige-Gordon: I agree with the hon. Gentleman. What I have said applies to investment just as much as it does to everything else. We are told that it takes something like £2,000 of capital investment to employ one man. I should like to see some of the people employed in that way getting the chance of that money as capital loans so that they can get started themselves and possibly employ others later.
  I also think that we should look very much more carefully at the suggestions of Sir John Toothill and others about a differential fiscal policy in Scotland for the sake of development. It is an idea which has been put forward already in this debate. I do not believe that we need to be too proud in Scotland.
  There has been much talk already about the Common Market. One obvious effect of British entry inevitably will be an intensification of what is called the "Golden Triangle". Scotland is outside it. Therefore, development policies will be even more important if we go into the Common Market. In view of that, why should not Scotland be made a pilot example of the virtues as well as the most effective methods of diversification and regional development? At the moment, there is no other part of Western Europe which could provide such an opportunity.
  I wish to say a special word about oil. My right hon. Friend the Secretary of State referred to it in his speech. In our position today, we must direct careful attention at anything which provides a real cause for optimism in the future. Is Scotland to become a booming oil country? If so, how long will the boom last? What plans can be made to see that the investment therefrom will be solidly based? I recognise that oil does not have a direct effect on employment to any great extent, but there is no question of the wealth involved, and it could affect my own part of the country in the North-East of Scotland. As my right hon. Friend said, B.P. is considering

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  landing oil from its Forties oil field in the North Sea, 110 miles from the coast, at Peterhead in my constituency. Peterhead is ideally suited for this kind of enterprise. I should like an assurance from my right hon. Friend that the Government will give every assistance that they can to this laudable enterprise.
  B.P. is one company. There are now 400 blocks in the North Sea open for licence. The majority of those blocks are off Scotland. As my right hon. Friend has said, there are four major oil investment companies with predominantly Scottish capital. Will my right hon. Friend be able to ensure that Scottish interests are taken into account fully in dealing with these natural resources? Again, when some of the blocks are auctioned, can we be sure that Scotland gets the value of the money spent and its fair share of the oil royalties? I do not think that we are being selfish when we make a strong point of this.
  England has always been a comparatively richer country, by the accidents of geography and size. In this matter of oil, it is just possible that the balance may be redressed somewhat. I believe that Scotland should have the benefit of the riches in her sea and that the Government should ensure this.
  I conclude with a brief word about boat building. Not all the boat building in Scotland is done on the Clyde. In recent months, I have tried to make it plain to the Government that boat building in the smaller yards round the coast needs reconsideration.
  In the North-East two leaders of the industry have given tongue to their concern about lack of orders. In earlier debates and in correspondence my hon. Friend the Under-Secretary of State for Home Affairs and Agriculture gave me to understand that if this situation persisted he was prepared to receive a deputation from these boatyards later in the year. Has he any proposals yet for such a meeting?
  Mr. John Robertson: Would it not be wise for the hon. Gentleman to make sure that he received a deputation right away? Otherwise, the ferry ships being built for the Shetland-Orkney-Aberdeen run will have been built in the Faroes,
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  outside British shipyards, with British Government subsidies.
  Mr. Wolrige-Gordon: I am aware of that. I am also concerned as a matter of policy. I do not blame any man considering investment in an inshore fishing boat, which would be built in one of the yards I have in mind, being very careful about pursuing his investment plan. I very much hope that account has been taken of the considerable advance which has been made in the Common Market negotiations as a result of my right hon. and learned Friend's discussions there last Monday. But, even so, I read in the Press at the weekend that the Highlands and Islands Development Board is being very careful about its investment plans for the industry during this difficult stage. I am sorry about that, but I fully understand the reasons for it. Nevertheless, this matter will presumably be resolved by October. I hope that my right hon. Friend will bring this debate to the attention of his right hon. and learned Friend so that the position of these yards, which in many cases is potentially critical, can be reconsidered in time.
  A minor point concerns the credit facilities to enable the yards to compete with countries like France, Norway and Poland in supplying fishing boats to Southern Ireland. This industry is in almost the same state of suspension as the negotiations go on. However, I think that we should be in a position to compete with other countries in supplying these boats. Our own yards are highly competitive. This has so far been a matter of negotiation between the Department of Trade and Industry and the Scottish Office. Will my right hon. Friend tell us the result of these negotiations at the end of the debate?
  6.33 p.m.
  Mr. Russell Johnston: It is not only the rate of employment which is so distressing, but its spread throughout Scotland. The Highlands has a higher rate of unemployment now than for 20 years, despite the existence of the Development Board for over six years. There is a high unemployment rate in the small burghs in the east in Banff, Arbroath and cities like Dundee. Even in the Borders there is an unemployment problem for the first time since the war. In Glasgow, in the centre of Scotland, we see it at its worst with the tragedy of

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  U.C.S. and the problems of Plessey, and so forth.
  Matters in Scotland are pretty grim, as the right hon. Member for Lanark (Mrs. Hart) said. I think that they are likely to get grimmer, despite the measures which the Secretary of State has announced, as we enter the winter.
  It is not only the immediate future which I find worrying, but, far more serious, the long term future of balanced growth in Scotland, standing, as we are, at the door of Europe. That is important, and it worries me considerably.
  We need immediate expansion in public works and the release of capital in the private sector. Houses are required to be built and roads to be constructed. I welcome the announcement made by the Secretary of State in this regard.
  I am perhaps more attached to Keynes that the right hon. Member for Lanark. I have always believed that it is better to create work than to allow men to rot on the dole. Although our social security system makes unemployment less horrible, the misery remains as real and the waste as tangible.
  It is important to look beyond the question of the expedient. Unless there is some vision there can be no hope and unless there is a plan there can be no defined progress. That is a criticism of this Government, frequently made by the Opposition Front Bench, which I accept. We cannot measure progress unless the Government say what they hope to do and in what time they hope to do it.
  I want briefly to try to present in outline a Liberal answer to a major part of Scotland's problems, the kind of answer which a Scottish Parliament, if we had one, in a British federal system would be pursuing. I was interested to note the remarks of the hon. Member for Edinburgh, South (Mr. Clark Hutchison) who was talking about differential taxation. I welcome this kind of conversion.
  Mr. Clark Hutchison indicated dissent.
  Mr. Johnston: The hon. Gentleman shakes his head.
  Mr. Clark Hutchison Mr. Clark Hutchison rose—
  Mr. Johnston: Incidentally I admired the hon. Gentleman's courage. Knowing
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  his view on the Common Market, I visualised him waiting out the dreadful doomwatch sitting in his clock factory. That was quite a thought.
  Mr. Clark Hutchison: I should like to correct the hon. Gentleman. It is not a conversion. I have been nattering about differential taxation for years.
  Mr. Johnston: The trouble is that we need more than nattering. We need some firm commitment.
  Mr. John Rankin: What is wrong with "nattering"? It is a common expression.
  Mr. Speaker: Order. There is a great deal wrong with sedentary nattering in this House.
  Mr. Johnston: I entirely agree, Mr. Speaker.
  There are certain things which are, as it were, going for Scotland. I want to list them and try to fit them together.
  As I said in the last debate on 3rd February, and as has been mentioned already, there is, off our shores, an unmeasured wealth of oil and gas from which we could benefit and which equally could pass us by. It was significant that the Secretary of State mentioned it. When I raised it in the last debate there was no mention of it from the Front Bench. Indeed, the hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) has apparently discovered it, though he made a long speech on 3rd February without referring to it.
  There is in the Clyde an unequalled asset—Scottish, British, European, call it what we like—as a deep water port, and related to it there are the skills of shipbuilding, which are now at risk, the opportunities to produce steel competitively with the world at Hunterston, the ore terminal, and the concept of Ocean-span linking Europe to the Americas.
  There is in the Highlands and Islands Development Board, for all its limited activity, a body with powers and evolving expertise both to refashion the Highlands and also to be the prototype for similar exercises in the other regions of Scotland, perhaps fitting into the pattern of local government reform which may eventually come forth. Liberals have argued this for a long time. Indeed, my right hon. Friend the Member for Orkney

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  and Shetland (Mr. Grimond) mentioned a Highland Development Board in his maiden speech in 1950. My hon. Friend the Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) introduced a Bill for a Border Development Board.
  On 6th December, 1967, I asked the then Secretary of State for Scotland what forecast he could make
  "of a reduction in the number of jobs in Scotland in coalmining, heavy engineering and shipbuilding respectively, over the next 10 years ; and what related provision he proposes to enable those who are displaced to be retrained in other skills".
  He replied :
  "it is impracticable to make firm forecasts for individual industries so far ahead, but measures to deal with training and retraining needs have been greatly advanced since the problems of structural change in Scottish industry were fully identified in the White Paper on the Scottish Economy."—[OFFICIAL REPORT, 6th December 1967 ; Vol. 755, c. 302.]
  The Liberal Party found that an unsatisfactory answer. It is not that I am particularly chiding the right hon. Gentleman in retrospect for that answer ; I think that he deserves great credit for producing the White Paper and trying to make a forecast. The failure has been to try to make subsequent revised forecasts.
  The Scottish Liberal Party set up a Committee under the chairmanship of Mr. R. A. Robertson, the Chairman of Hutchison Engineering. It reported in February 1968, and projected redundancies in shipbuilding, which have been justified, and argued for a super yard on the greenfield site. Events since then, and thinking since then, have led us to link this idea to other proposals to form a considered plan.
  First, we would bridge the Upper Clyde position for two or three years, or perhaps a little more, thus saving the skills and the valuable equipment that is there, because much of the yard has been refurbished. Second, we would use that time and the confidence it would create to construct a new super yard on the greenfield site, making it a joint effort between the Government and the private sector. Third, and this the Secretary of State must do, we would go ahead with Hunterston, because a steel works only makes real sense in Scotland if it is linked to shipbuilding.
  Mr. Brewis: Has the Liberal Party costed all these developments? Can the hon. Gentleman give us any idea of what they would cost?
  Mr. Johnston: I shall come to that in a moment. The hon. Gentleman is right to be concerned about the cost. His Government are not profligate with money. That is one thing of which they cannot be accused.
  Japanese steelyards can produce about 250 tons a year, and aim to produce about 700 tons. Those are the figures for individual plants. The British figure is 150 tons. It has been estimated that Hunterston could produce up to 800 tons. The fourth thing is Oceanspan. I mentioned this in the debate on 3rd February. It cannot be left to the Clyde Port Authority. It is something which the Government must take up.
  If those things were fitted together, they could represent a considerable industrial revolution in Scotland. This all costs money, and I now return to the question of oil, because this is not merely the meanderings of a Liberal. I am not alone in holding the view which I expressed during the debate on 3rd February. The magazine Scotland, issued by the Scottish Council for the Development of Industry, this month poses the same questions which I posed during the debate, and to which I received no answers from the Minister.
  First, what will be the revenue from the granting of franchises? Will it be £20 million, £50 million, or £100 million? Where will the money go? Will it go straight to the United Kingdom Treasury? I suppose the answer is "Yes". Will Scotland get any allowance for it? I fear that the answer is "No".
  Second, what will the royalties yield? The magazine Scotland estimated the yield at about £100 million, which is quite a lot of money.
  Mr. Douglas: The line of thought which the hon. Gentleman might like to pursue is who will get the rates for the rigs?
  Mr. Johnston: That is a good question. Where will the work go that will be involved, both in the drilling and on shore? The magazine to which I have referred asks whether Aberdeen, which

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  is ideally situated, will derive any benefit.
  Money is there, not only for the Clyde, but for related development in the East and to provide backing for regional development elsewhere. The Highlands and Islands Development Board has had £8 million—that is about 1¼ miles of motorway a year—over the period of its existence, and one cannot expect to make any fundamental change in an area the size of the Highlands with that kind of money.
  The Robertson Plan is an integrated plan which could offer a viable future and, as I said on 3rd February :
  "If our problems are to be solved, more urgent and radical measures will be necessary than have so far been taken."—[OFFICIAL REPORT, 3rd February, 1971 ; Vol. 810, c. 1774.]
  I repeat that, and I do it, as I believe a Liberal always should, having made constructive suggestions which can be criticised, because these debates ought to be used as constructive occasions rather than as opportunities for mutual recrimination.
  6.45 p.m.
  Mr. Ian MacArthur: I was interested to hear the speech of the hon. Member for Inverness (Mr. Russell Johnston). I was glad that he, too, referred to the enormous excitement over the discovery of oil off Scotland. We know that the oil is there. The indications are that large strikes could be made, and I believe that these could result in a flow of wealth into our country to an extent which we can hardly begin to grasp.
  Mr. Rankin: But not into Scotland.
  Mr. MacArthur: The choice of this subject for today's debate was not unexpected. The unemployment rate in Scotland is alarmingly high, and the industrial scene has been darkened latterly by the agonies of Rolls-Royce and U.C.S. There have been other blows, too, such as that described by the hon. Member for Dunbartonshire, West (Mr. Ian Campbell), in whose constituency the Plessey factory lies.
  It is natural that the Opposition should have selected unemployment as the subject for debate on this Scottish Supply Day, and it is right that we should debate
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  this problem which, directly or indirectly, affects every person in Scotland. As my hon. Friend the Member for Aberdeenshire, East (Mr. Wolrige-Gordon) said, unemployment is everyone's problem, whether unemployed or not, and the growth of unemployment in Scotland has certainly stripped too many people of their jobs.
  But it is wrong of the right hon. Member for Kilmarnock (Mr. Ross)—and I am glad that he is back in his place—to have mounted his assault on the Government in the way that he did. His speech will not bring much comfort or hope to the army of unemployed to which he referred. It is an army of unemployed, and I believe that the quality which we need to restore in Scotland, and which the army of unemployed needs, is that of confidence. There was nothing at all in the right hon. Gentleman's speech to build confidence or to point to those areas in which we can justifiably say there is confidence. I think that the right hon. Gentleman did no service to his constituents, or to the people of Scotland, by blackening the outlook for Scottish industry in the way that he did.
  We are used to this sort of dreary dissertation from the right hon. Gentleman, and I make no complaint about that, but it is curious to hear him berating the Government for the situation that we face. What, one may ask, was the right hon. Gentleman doing during those long, long years between 1964–1970 when he was presiding over Scotland? I remember one thing that he did. He published his notorious White Paper, to which I refer often, and—
  Mr. Douglas: Not again !
  Mr. MacArthur: —I shall go on referring to it. I recommend right hon. and hon. Gentlemen opposite to read it every day and, when they go to bed to read it there. If they do, they will have nightmares when they realise the extent to which they muddled the economy, fiddled the election and misled the people of Scotland.
  In January, 1966 the right hon. Gen-leman published his great White Paper on the economy. He set as his target the creation of between 50,000 and 60,000 extra jobs. That was the main theme of the document, and I remember the Press release which the right hon. Gentleman

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  put out to all the newspapers in Britain. It had as its opening words "More jobs". That was his promise to the people of Scotland. They were to get 50,000 or 60,000 more jobs. Of course we did not get any more jobs at all.
  What happened was that by the end of the period we had lost 82,000 jobs. The right hon. Gentleman missed his target by a total of 142,000 jobs—the 60,000 that we did not get and the 82,000 that we lost. Yet right through his period of office the right hon. Gentle-clung obstinately to his discredited White Paper and treated our constant questions with constant contempt.
  Mr. Ross: Hear, hear.
  Mr. MacArthur: It is also strange to hear the right hon. Gentleman claiming credit for removing S.E.T. from some hotels in Scotland. He pointed to this in reply to an intervention of mine.
  He may take pride in that if he wishes, but who was it who imposed selective employment tax on the hotels in Scotland? It was the right hon. Gentleman himself. In January, 1966, in the notorious White Paper which I have mentioned, just before the election, the right hon. Gentleman wrote that special attention would be given to tourism. Special attention is what tourism got—the special attention of the selective employment tax—in May, four months later.
  The right hon. Gentleman, who accused the Highlands of whining about selective employment tax, applauded to increases in selective employment tax and then realised too late the harm it was doing, and he and his right hon. Friend the then Chancellor of the Exchequer at last and belatedly removed the tax from one of the most sensitive areas in Scotland, the Highlands, but restricted the removal to hotels alone. To hear the right hon. Gentleman take credit for that is to be reminded of the parent who claims to be kind when he stops bashing the baby. When the right hon. Gentleman was in office and looked to the future, he failed miserably on every count. On that record, no one in Scotland will pay much attention to what yesterday's man has to say about tomorrow.
  If we look through and beyond the extremely discouraging unemployment
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  figures in Scotland, we find that there is some evidence to give us encouragement for the future. Since the war, under successive Governments, the structure of our industry has changed fundamentally, much more so than people generally realise, As the older industries have declined, so the newer industries have advanced. The pace of advance has certainly not been enough to replace each lost old job by one new gained job, but the modernising change in the nature of employment in Scotland has been progressing for 20 years or more.
  A visitor returning to Scotland today after a long absence would hardly recognise the scene, certainly in the industrial belt. It is a new Scotland in which we live. Certainly the shadow of unemployment hangs over the industrial belt and beyond, not least in my constituency, but that shadow should not be allowed to obscure the fact that we have a healthy modern base of opportunity from which to expand and it is expansion which we need now.
  We need above all to exploit that opportunity to provide new modern jobs, to bring to an end the chronic gap between employment levels in the North and the South. My right hon. Friend will agree that some of the Budget measures earlier this year are only now beginning to have effect, because they took effect only a week or two ago, and we can expect that they will contribute to an upturn in the economy soon. I trust that the likely extent of that upturn will be considered by my right hon. Friends with the utmost care, because it may not be enough to produce the resumption of growth which we need. There are other measures which the Chancellor could take, and I am certain that there will be no hesitation about taking those further steps if they can be taken without the risk of swinging the country back into a renewed burst of inflation.
  We were told today by my right hon. Friend of a welcome range of actions, £33 million worth, to inject additional employment into Scotland, and I warmly congratulate my right hon. Friend on this initiative.
  Mr. Ross: It was £35 million. I know because I have had the advantage of reading it in the Evening Standard.
  Mr. MacArthur: I am obliged to the right hon. Gentleman. I understood it to be £33 million. It is a very substantial and welcome sum. These measures will bring great relief at the very time when relief will be sorely needed.
  My right hon. Friend will agree, however, I am sure, that, excellent chough these measures are, they are essentially short-term measures and in themselves will not meet our longer-term need, which is the provision of securely based long-term employment.
  We have often discussed the relative merits of investment grants and investment allowances as a means of encouraging industrial development in Scotland. I have no doubt that the present system is likely to be more beneficial, but any incentive to encourage industries to move and develop can be effective only if industry is in a mood to move and develop. There is not enough of that mood today, but I suspect that a relatively small change in the economic climate would transform the position and spur on the confidence which we need for investment and expansion. It requires relatively little to tilt the balance so that we may enter a period of growth.
  Contrary to what has been said by hon. Members opposite the position is not entirely that of stagnation. In the six months from December, 1970, to May, 1971, the number of I.D.C.s approved represented 6,170 jobs. Certainly that is not enough, but that compares with an increase of 4,260 jobs in the equivalent period a year previously, when the right hon. Gentleman was in power. It is an increase of 45 per cent. and it is worth pointing to that figure. It is not enough, but it is certainly much more than a drop in the ocean of need.
  We urgently need more expansion. I suggest that it is the state of the total United Kingdom economy which matters most. What Scotland needs for growth is growth in the total economy, because it is only then that the incenives to move and develop can have any real effect. The prospect for Scottish growth must be set in the United Kingdom context, certainly in the short and mid-term. If that is right, and I believe that it is, it must be right also to set the Scottish economy in the European context.
  In the longer term, our manufacturers in Scotland would have direct access to
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  a vast European home market, and foreign investors would see Scotland not only as part of the United Kingdom, but as part of Europe and so as a base for serving Europe. It is worth remembering that in the years after the last war American industry saw Scotland as a base from which to gain access to the Commonwealth and the sterling area, and there were many American developments in Scotland, accounting for some 10 per cent. of our employment. This was welcome employment and it was a most important development in the Scottish economy. In much the same way, and perhaps much sooner than we expect, expanding industry on the Continent will look to Scotland as a base for expansion.
  Entry into the E.E.C. will produce an additional stimulus to development of the economy in Scotland, and I am sorry that the right hon. Gentleman made his silly remark about the visit to Germany by my right hon. Friend the Minister for Development. That visit and his discussions were looking ahead constructively, but that, I appreciate, is an approach which the right hon. Gentleman is unlikely to comprehend.
  My right hon. Friend did the House a service by reminding us of what the right hon. Gentleman had to say about the E.E.C. two years ago, but since then the right hon. Gentleman has been playing "follow my leader".
  Mr. J. Bruce-Gardyne: A difficult task.
  Mr. MacArthur: It tends to make one giddy.
  According to the Sunday Mail, two days ago, in a clarion call to the people of Scotland, the right hon. Gentleman said :
  "There's nothing much you can say about my view until we can have our various conferences".
  That was in answer to a question about the E.E.C. That is the quality of leadership which the right hon. Gentleman offers to us and his alleged followers in Scotland—he will do what the various conferences tell him to do.
  On this crucial question he leads his regiment from behind. Like the Duke of Plaza Toro he may find this more exciting, but it is a curious form of leadership for the right hon. Gentleman to display

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  to those in Scotland who he claims follow him.
  Mr. Alexander Wilson: Is the hon. Gentleman suggesting that the ordinary citizen has no right to say whether or not we should join the E.E.C? In other words, is he suggesting that hon. Members should not listen to their constituents, to the voters and their organisations, on this issue? What is his idea of democracy?
  Mr. MacArthur: My idea of democracy is that an hon. Member should say what is in his mind. He must, of course, discuss this and all problems with his constituents. It seems odd that the leader of a once great party in Scotland, having declared his view two years ago, should suddenly dodge the issue and sit on the fence at the crucial moment when people are supposedly looking to him for guidance and leadership. That is what the right hon. Gentleman has been doing over this issue.
  There are three stages of opportunity in Scotland. First, in the short-term, the further and massive injection of funds announced today, coming on top of the measures which my right hon. Friend announced recently, will provide more jobs, and do so quickly, but these are essentially short-term measures.
  Second, in the short to mid-term, the resumption of growth in the United Kingdom will act as a spur to growth in Scotland, where we have a healthy industrial base from which to expand. However, I remind my right hon. Friend that unless there are indications of growth in the total economy soon, we will not stimulate investment and get the expansion we need.
  Third, in the mid to long-term, we have the great opportunity which our entry into the E.E.C. will provide for Scotland. The immediate scene is grave. As the Government Amendment states, unemployment is regrettably high. I would call it intolerably high. Yet there are grounds for confidence and, far from it being complacent to point to them, I believe that it is irresponsible and damaging not to point to them. Beyond the present gloom there is reason for confidence because there are large new opportunities for Scotland, and a strengthening base from which to grasp them.
  Several Hon. Members Several Hon. Members rose—
  Mr. Deputy Speaker (Sir Robert Grant-Ferris): It is just after seven o'clock. This might be a convenient point for me to point out that I have been informed that many hon. Members wish to speak in this debate. I calculate that if each speaker takes not more than ten minutes, nearly all, if not all, those wishing to take part will be able to speak.
  7.04 p.m.
  Mr. Robert Hughes: I will not follow the hon. Member for Perth and East Perthshire (Mr. MacArthur) in his peregrination around the Common Market. I hope that I will be fortunate to catch Mr. Speaker's eye when we debate that subject next week.
  It is clear that the injection by the Secretary of State and hon. Gentlemen opposite of the whole subject of the E.E.C into this economic debate has simply been a smokescreen to cover up the ills of the past 13 months of Tory rule.
  We seem always to be dealing with a gloomy situation in Scotland. The picture is always dull. It is understandable that my hon. Friend should be pessimistic rather than optimistic because many of us have been through redundancy or the fear of it and the closures or the fear of them. We have lived through these things in the firms which employed us before we came here.
  For the last 20 years or more we have debated the decline of the Scottish economy. We have a dream that one day we ill discuss Scottish economic affairs and they will be in a healthy condition—that we will have the same kind of overheating problems that seem to occur with unfailing regularity in the South-East of England.
  For a while under Labour there was a degree of confidence in the future. There was a glimmer of hope that the Scottish economy was beginnin gto up-turn a little. Six years of Labour Government produced considerable expansion of the infrastructure. New modern industries were beginning to establish themselves in Scotland and we had high hopes of great expansion. But, unfortunately, the pace of progress has not been contnued.
  When I spoke in the debate on the Gracious Speech on 9th July I welcomed the prospect of a computer memory manufacturer coming to Aberdeen. Sadly, this

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  prospect is no longer as certain as it was. The company concerned decided that it had to postpone the building of a new factory, and I understand that a final decision whether or not to come to Aberdeen will not be made until the end of this year. The reason for this change of heart is that the general economic situation of the country does not warrant the firm going ahead with its expansion plans. I am pleased to note, however, that the company does not have a closed mind to expanding in this way, but I must admit to being a great deal more pessimistic than I was some time ago.
  Industries with growth potential are, of course, welcomed because they have financial backing. However, they are hesitant to commit themselves. Even more damaging, of course, is the picture of new industries closing down and leaving Scotland to return south of the Border.
  The Government's regional policy has definitely changed for the worse. The change to tax incentives away from the cash grants that were available under the Labour Government have made a big difference. I accept that hon. Gentlement opposite, being loyal Conservatives, will not accept what I say, and I therefore draw to their attention an article which appeared in the Aberdeen Press and Journal of 8th July last under the heading :
  "No Ross Smelter but for Labour Grant".
  The report was of a statement to hon. Members made by the chairman of the British Aluminium Company who, when giving evidence to the Select Committee, said according to the report :
  "We were strongly influenced by the investment grant and its availability on this scale. We would not have gone ahead without it."
  In other words, the chairman of one of the biggest capital-intensive industries in the country was making it clear that under the present system he did not believe that his company would have gone north. Capital-intensive industries are important, although the kind of industries we want in Scotland are labour-intensive.
  What other items of policy do the Government have to help alleviate hardship in Scotland and overcome some of our problems? There was an interest-
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  ing interchange at Question Time on 8th July, and although it was in relation to Southend—it was about the dispersal of Government personnel from London—the answer given by the Prime Minister, who had been charged with indifference, was interesting. He said :
  "As to indifference, it was under Conservative Governments that both the main initiatives for dispersal of Government personnel from London were taken. They were taken in 1963 by a Conservative Government, and by myself in this Conservative Government."—[OFFICIAL REPORT, 8th July, 1971 ; Vol. 175, c. 1518.]
  HANSARD, of course reported accurately the words uttered by the Prime Minister, but neither our OFFICIAL REPORT nor any other report could possibly reveal the flavour and tone of the right hon. Gentleman's remarks. The words do not savour the mood in which the Prime Minister was that day. The right hon. Gentleman was in his most arrogant mood, pointing out how on both occasions the Conservatives had done something to disperse Government personnel from London.
  I advise the right hon. Gentleman to look at the record. He will see what happened as a result of that famous dispersal policy of 1963. The Scottish unemployment total was 105,000 and the total net migration that year was 40,000. The only other year in which unemployment approached that record figure was 1959, when the average for the year was 95,000 unemployed, with an annual net migration total of 25,000.
  In the first year of Tory Administration we are again over the 100,000 mark. The House and country will have noticed the strange coincidence that in years of Conservative Administration we have extremely high unemployment figures. It is no use hon. Gentlemen opposite calling this a coincidence. The previous occasion was after 13 unlucky years of Tory rule—unlucky for the country in general and for Scotland in particular. Instead of boasting, the Prime Minister should have approached the Dispatch Box with some shame for the damage which he and his Administration have continually done to Scotland.
  On the dispersal of Government personnel, if the Prime Minister wishes to live up to his words about producing some diversification and dispersal, he

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  should take up the suggestion made in this month's magazine Scotland, which suggests that Aberdeen could become a major oil centre. This is possibly the only thing which the hon. Member for Aberdeen, South (Mr. Sproat) and I have in common. We both wish to see a great expansion of the oil industry in Aberdeen and the North-East. The magazine suggests :
  "North Sea activity has pushed London to the fore, because it is there that the international companies can contact the Government—in this case the Department of Trade and Industry, Petroleum Division. This could equally well be sited at Aberdeen and would act as a magnet for the companies who at the moment set up their European bases in London."
  I hope that the Government will act on this proposal and do us the service of providing the magnet to attract all kinds of new industry to Aberdeen.
  By their hag-ridden dogma the Government have allowed U.C.S. to go to the wall. Despite the consequences to the Scottish economy, they have done nothing to prevent U.C.S. landing in difficulty. For the shipyards the difficulty is not confined to the Upper Clyde. Many people in my constituency work in the small shipyard of John Lewis and Company, which strives hard to expand the order book and to try to modernise and slough off its extremely bad history of bad industrial relations and antiunion managements. None of these things is possible without firm order books on which to base the future. People cannot spend money on new machinery unless the future prospects justify it. It cannot inspire the workers to be more flexible unless there is a very firm order book.
  The John Lewis shipyard tendered for four ferries for the Shetland Islands, worth £500,000, on an extremely competitive basis. All of us in Aberdeen were extremely concerned when this order, which has Scottish Office approval—I understand that about 75 per cent. of the cost is to be met by the Scottish Office—went to the Torshvn shipyard in the Faroes. The Aberdeen Press and Journal again mentions this :
  "Four car ferries costing more than £500,000,.. are to be built in a foreign yardd because the price is 'considerably less' than any British yard can offer."
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  It goes on to say :
  "Representatives of the council and our consultants visited Faroe and were satisfied the yard was capable of producing a first-class job. And the Faroese Government are guaranteing that the vessels will be delivered at the stated price."
  It has been suggested that the guarantee goes much further than the Faroese Government giving a guarantee regarding the stated price for delivery. It is suggested very seriously that the Danish Government has guaranteed this shipyard against all loss appertaining to this order. If this is the case, there can be no competition on the order.
  It is the duty of the Scottish Office, especially where development areas are concerned, to make absolutely certain, first, that tenders are competitive, and, second, that there should be a direct channelling of work towards the development areas. It is no use waiting until companies get into distress and are almost closing before weeping crocodile tears and trying to do something about it. The time to do something about it is now, when the company is trying to expand. The Government have been sadly lacking in this respect.
  The Government's attitude on unemployment is best typified by the psychology of the statements made in the past by leading members of the Government. None of us in Scotland will ever forget the occasion on which the Prime Minister, then Leader of the Opposition, was interviewed on Scottish Television about tax incentives and investment policy. He received a reasonably hostile interview because the interviewers were concerned about the cuts he was promising to make if he obtained office—which, in the unfortunate event, he did—and the kind of damage which this would do to the Scottish economy. His attitude to Scotland was, "Do you want a soup-kitchen country in a soup-kitchen economy? "This kind of grotesque insult to the people of Scotland hits hard and he will not be forgiven for it.
  Our forebears outside and inside the House know the soup-kitchen as the reality of every-day life, the reality of the unemployed. The Government have conjured up out of the nightmare of the past the reality that perhaps not too far in the future the soup-kitchen will be with

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  the people of Scotland. We can almost forgive the Government for not knowing of the unemployment and hardship or to what extent they affect us. But what we can never forgive is that they do not care a damn about the people and the unemployment in Scotland.
  7.16 p.m.
  Mr. John Brewis: For at least 10 years I have been taking part in debates about the Scottish economy. I assure the hon. Member for Aberdeen, North (Mr. Robert Hughes) that the ills of the Scottish economy have certainly not started in the last 13 months. It is wrong to suggest that all was well under the previous Labour Government. My hon. Friend the Member for Perth and East Perthshire (Mr. MacArthur) pointed out the loss of 82,000 jobs, which was very bad compared with the performance of the previous Conservative Government, when there was a net gain, in a very difficult time, of 76,000 jobs. On top of this, in 1966 there was the highest rate of emigration from Scotland of 47,000 people.
  The right hon. Member for Kilmarnock (Mr. Ross) presided over a very rapid rundown in the coalmining and shipbuilding industries. I notice that the right hon. Lady the Member for Lanark (Mrs. Hart), who graced our debate for a short time and has now left the Chamber, mentioned the possibility of public ownership and of diversifying employment opportunities. It is interesting to consider what the National Coal Board did in Scotland in the five or six years of Labour Government. Forty-nine collieries were closed and 4,532 jobs were lost. Fifteen of these collieries were in the right hon. Gentleman's county of Ayrshire, in which there was a loss of 1,193 jobs. In Sanquhar, for example, the rate of unemployment rose at one time to 25 per cent. But now, with the introduction of a new industry, Century Aluminium, in which my hon. Friend the Member for Dumfries (Mr. Monro) had some part, unemployment is falling.
  Mr. Alexander Wilson: Why did each one of these collieries close? Was it through seam exhaustion or on economic grounds? What were the reasons for closure?
  Mr. Brewis: Largely because coal priced itself out of the market.
  Mr. Ross: I know a lot about Sanquhar, and one of the reasons why the colliery there closed was complete exhaustion. The hon. Gentleman mentioned what his hon. Friend the Member for Dumfries had done, but he did not mention what the Labour Government did. We made it a special development area. We introduced Templeton's Carpets, Trends Carpets and aluminium—at least three new industries. The hon. Gentleman should say how many have closed under his Government.
  Mr. Brewis: Would the right hon. Gentleman like to say how many industries came to Galloway, my constituency, under his Government? I am very happy to agree with him that there have been new industries introduced into Sanquhar and that his Government made it a special development area.
  The Scottish economy is very dependent on the United Kingdom economy because we rely so much on the local employment policy inducing industry to go to development areas.
  The hon. Member for Aberdeen, North complained about the inducement system for getting industries to development areas. It is a good package of inducements now and it was a good package of positive inducements before. At present the only negative inducement is the I.D.C. system. I do not say for one moment that the I.D.C. system should be abolished ; because it has the effect of bringing to the attention of industrialists the attractions of a development area. However, in view of the number of I.D.C.s granted in non-development areas I wonder how effective the system is. In 1960–64, for example, 91·5 per cent. of all I.D.C.s were granted in non-development areas. In 1965 the proportion fell slightly to 90 per cent.—virtually no change. In 1969 it was up again to 92 per cent.
  We need a stronger form of negative inducement to get industry to move from over-heated areas to development areas. When I journey by train through England I am surprised to see how much industrial building is going on. Sometimes there is an obvious reason for the location of a factory in a particular place. Obviously grand pianos cannot be made in the Western Isles, for example. However,

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  on going to London Airport by bus one wonders whether it is necessary to have a Cherry Blossom boot polish factory at Chiswick, more or less in central London. Going a little further afield, speculative developers are erecting industrial factories at Iver, near Slough. There is a toothpaste factory at Taplow. Even in Banbury they make instant coffee, employing about 2,000 people. All these are developments which have taken place in the last 10 years or so.
  There is a case for looking into the problems of congestion in non-development areas. We in the Select Committee on Scottish Affairs asked some questions about this of the Board of Trade. It then seemed that little study had been done on this subject under the last Government or the one before that. I hope that this Government will look into this position, because far more needs to be done to induce industries to go to development areas.
  Much has been said about the opportunities Scotland will have when we join the Common Market. I do not wish to say much about it. Undoubtedly the E.E.C. is sucking in labour from many outside countries like Yugoslavia, Turkey and Greece, and there is industry which needs to be exported from the E.E.C. to areas of high unemployment. In view of the way that German industry has developed in Southern Ireland, I think that we have missed out in the past in looking for the developments we have got from America, because we could probably have got developments from parts of Europe. I therefore congratulate my hon. Friend the Member for Ayr (Mr. Younger), the Under-Secretary, on looking into this, and I wish him all success.
  I turn to a constituency point, though I think that the principle of the matter is relevant to much of rural Scotland and particularly to the subject of land use, which subject we are now considering in the Select Committee on Scottish Affairs.
  For years Wigtownshire has suffered from high unemployment and high migration. Although it has been a development area for many years, no factory employing men has been attracted to the area nor, in view of the higher grants now available in Central Scotland, is it likely that such a factory will come there.
  When it became clear that the Shoeburyness gun-proving establishment would
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  have to move from Foulness because of the new airport, I know that my right hon. Friend the Secretary of State for Scotland worked very hard in the Cabinet to get it to come to Wigtownshire, because it meant a net increase of about 350 jobs, mainly for men, over those at present employed by the Royal Aircraft Establishment at West Freugh. Whatever one's views may be locally about this problem, one should thank the Secretary of State for his efforts on our behalf.
  As I said in an intervention, we in my part of the world are used to defence establishments : there has been an R.A.F. bombing range in Luce Bay for at least 30 years. During the war there were many other establishments, including a gunnery range at Burrow Head, and there is still a tank firing range at Kirkcudbright. We are used to the R.A.F. occasionally dropping bombs on its bombing range in Luce Bay. We are used to the test flights of Concorde going overhead. These are intermittent noises.
  The gunnery range is in a completely separate category. Some hon. Members may know that the noise from a gun is about three times as bad in front of the muzzle as behind it. At Foulness there is a straight coast and most human habitation is behind. But firing into a bay means that many people along the coast are living in front of the guns.
  When an experimental gun fired about 60 rounds on 25th June, there was a moderate wind from the South-West which protected the Mull of Galloway. However, on the east coast of Luce Bay the sound was excruciating. At Stairhaven the ground shook from the noise of the gun, and I am told that pig lamps were broken by the vibration. All along the coast, doors and windows rattled. It was many times worse than the biggest bombs the R.A.F. has dropped. Such a level of sound might be tolerable occasionally, but the gun position is scheduled to fire on 225 days a year a total of 20,000 rounds—that is, every working day Monday to Friday about a round every five minutes or so.
  I do not think that anyone could go about his business in Stairhaven without wearing ear mufflers. We know that the guns will kill tourism all along the coast from Glenluce to Port William and probably in a wider area. Tourism is a

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  tender plant. There are only two little areas in Northern Ireland where there is any trouble and they are not areas where tourists normally go, yet the tourist trade in Northern Ireland has withered since the trouble started. Yesterday a bank manager told me that his branch at Stranraer alone had taken £1 million in tourism every year. Therefore, the money from tourism is by no means chickenfeed.
  I do not think that it is equitable that people who have established caravan parks or made improvements to their hotels or property should suddenly have their work ruined by the noise coming from a gun range, and there is no possibility of their getting any compensation.
  Yesterday the county council voted by one vote in favour of a gun range but by a much larger majority in favour of a public inquiry. I hope that my right hon. Friend will be able to give us this and tell us so tonight, because it is a very unpleasant atmosphere when people start questioning each other's motives. One side says that the other side is not interested in unemployment. The other side says that the other people are not interested in amenity. It would be the fairest thing possible if there could be a public inquiry presided over by somebody of the status of a judge of the Court of Session, and thereafter we would be prepared to accept his decision.
  I want to raise two other small points which could not be taken into account in the county council's deliberations. Even taking over 2,500 acres of good arable ground there is not room to get more than eight of the 14 Shoeburyness gun facilities into the site there. This is utterly uneconomic and not sensible. Would it not be much better to find a bigger site on which the whole establishment could be set up all together?
  Second, millions of pounds have been spent on the R.A.E. station at West Freugh. For example, there has been the extension of the runway, only just completed. If that establishment has to move, more millions will have to be spent re-establishing it somewhere else. Would it not be much better to settle for an increase in experimental work and, possibly, more employment at West Freugh, even though it might mean more
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  bombing in the bay? I feel sure that the local people would accept that with gladness rather than have the proposed gunnery range.
  7.31 p.m.
  Mr. William Small: On the question of defence establishments, the hon. Member for Galloway (Mr. Brewis) made his case, and his attitude is clear. On the question of joining the E.E.C., I find that a smoke-screen is raised all the time. I am always interested to see the man who becomes a 100 per cent. European, and I am watching the performance of right hon. and hon. Members opposite with close attention. At one time the great cry was for the abolition of British Standard Time. Here was a move for synchronisation between ourselves and Europe, but then came the great cry—it appeared in election addresses too—"Let us do away with British Standard Time"—bash the Labour Government, and bash B.S.T. I am waiting to see what hon. Members opposite do about reintroducing the principle of synchronisation with Europe as a first indication of their faith. It will be interesting to see what the Scottish Tories do.
  My purpose is to deal with unemployment, and in the context of what is happening in Glasgow, in particular. Never have there been such scenes within living memory—at least, I have never known them—as the great demonstrations which have recently come down to London. What is happening to our communities in Scotland today? I have to speak up for the unemployed. I have been one of them in my time. I walked the streets for a long while, and I know something about it.
  There is a great sense of concern in the community now. In George Square already, a petition has attracted 100,000 signatures. What is the concern about? First, there will be children weeping at home this weekend because their parents are not taking them on holiday this year. What can their fathers and mothers say? There is a dethronement of the authority of the parents because the children feel that they cannot provide them with the amenities which other children can have at this time.
  The children who are leaving school have been cheated. In the old days, the

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  idea was that the workers would be educated beyond their station by our public education service. Now, people know their rights, they know their anticipations, and they know their true station. Under both Governments, a great education prospectus was launched. Our children are going through the schools and colleges, and passing out with flying colours, but at the end of the day they are cheated and robbed of their prospects of employment.
  Nothing could be worse. Wherever one looks about the world—never mind about Tupamaros and people like that—a sense of deprivation is the incubator of crime, and that is no help to the cause of freedom and good order in our society. People feel that they have no objective when they have no job and no prospect of getting one.
  I say these things out of great concern and a sense of duty. I am not talking about economic man. I am talking about what unemployment means in terms of deprivation and humiliation for men and women and for their children at school. When children see that their parents cannot provide them with the generality of things which give them a sense of status in this country—there are those, for example, who can have a car, even though a second-hand one—they have a real sense of deprivation.
  To adopt what the Duke of Edinburgh once said, it is time this Government got their finger out and did something about it.
  7.34 p.m.
  Mr. Iain Sproat: The hon. Member for Aberdeen, North (Mr. Robert Hughes) raised the question of the Shetland ferries being built in the Faroes. He will not be surprised to know that I entirely share his concern in this matter, and I have already raised it with the Secretary of State for Scotland. I ask the Minister to tell us tonight whether, even if these ships cannot be built, as I should like them to be, in Scottish yards, we can be certain, at least, that the repairs, when they come up, will be done in Scottish yards. That would go some way to allay people's fears, particularly among the trade unions, a delegation from which came to see me last week.
  We have heard a lot of gloom and despondency from the Opposition today.
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  I do not disagree that there is a lot to be gloomy and despondent about—the U.C.S. affair, the Plessey affair, the totally unacceptable high level of unemployment, which concerns us just as much as it concerns hon. Members opposite—but I wish to present the other side of the picture, too. It is this other side of the picture which makes me profoundly confident about the medium and long-term future for Scotland.
  Moreover, today's announcement by my right hon. Friend of the short-term injections of capital which we are to have will go a long way to alleviate much of the short-term distress in Scotland today, I congratulate my right hon. Friend on the sums involved, which, I suppose, must approach about £40 million, including the house improvement grants which he announced earlier this month.
  I have considerable confidence in Scotland's economic future. First, we now have an excellent investment incentive package. It is a package which is generous, comprehensive and flexible. In spite of what was said by the hon. Member for Aberdeen, North, I entirely support the switch from grants to allowances because I believe that, in the long term, this cannot but create jobs and create viable industry. It is no use just creating industry which cannot go on providing jobs. So I entirely agree with the switch from grants to allowances. We can still have grants and loans, when we need them, under the Local Employment Act, which, as the very name suggests, is operated by reference to the amount of employment which can be given.
  Edinburgh and Portobello have been given intermediate area status. We have created a special development area in the West of Scotland, with improvements and advances in building grants, rent-free factories for up to five years, 30 per cent. operational grants, free depreciation, training grants, removal expenses grants, infrastructure improvement grants, and regional employment premiums until 1974.
  The only point—I put this to the Under-Secretary, my hon. Friend the Member for Ayr (Mr. Younger)—at which I should like to see an improvement is that in the special development area it should be possible to give some of the benefits to companies already there.

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  What we are looking for is increased production and more jobs. It does not matter whether a company comes in from outside, from further than 30 miles, or is there already. I ask my hon. Friend to consider that improvement, although I emphasise again that, overall, we have an excellent investment package in Scotland.
  My right hon. Friend, in opening the debate today, mentioned the subject of housing reform. I very much welcome what he said. This is all tied up with the whole question of Scotland's economic future. In Scotland today, we hold, alas, three wretched records in housing. We have the most houses in public ownership in the whole of the United Kingdom, we have the most overcrowding in slums in the whole of the United Kingdom, and we have the most absurd level of rents in the whole of the United Kingdom.
  I do not believe that it is coincidence that we have all those three factors together. It is obvious that the housing situation in Scotland deters companies which would otherwise be keen to take up the advantages which we can offer. They are put off by the appalling housing which, all too often, is to be found in Scotland today.
  Dr. M. S. Miller: Can the hon. Gentleman tell me what is absurd about a rent of £4 a week for a Scottish family whose main wage-earner is earning less than £20 a week, and when there is heavy unemployment in Scotland?
  Mr. Sproat: My point is that the level of rents in Scotland is roughly half the average in England, which leads to a situation in which there is not enough money to plough back into improving the housing. Cases such as the hon. Gentleman raises will be covered under our scheme, because we shall give rebates to those who do not have the income to pay the fair level of rent.
  Apart from the question of executives being put off coming to Scotland to new industry, I should be very interested to know whether any estimates have ever been made of the impetus to emigration from Scotland which the bad housing there over the years has given. I hope that the position will be greatly improved
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  by my right hon. Friend's proposal for housing reform.
  I agree that we have an excellent investment package for Scotland, but, as many hon. Members have said, until we can activate it by overall United Kingdom growth we shall not see the full advantages which it could bring. Therefore, we must consider what the Government are doing with regard not only to Scotland but to the economy of the United Kingdom. We are going through hard times, but I have faith in what the Government are doing to regenerate the economy as a whole. We are cutting taxation. We have already cut it by £1,000 million within our first year in office. We are slowly de-escalating huge and unjustified wage claims, which more than anything else have resulted in the high unemployment and high prices. Until they are de-escalated we shall not be able to stop that high unemployment and the big price rises. The main plank in the programme for regenerating the economy is putting some sense back into industrial relations.
  Those three points—the cutting of taxation, the de-escalating of huge and unjustified wage claims, and putting sense into industrial relations—are producing results, even though the Bill has not yet been passed. They are not great results yet, but the halving of S.E.T. and the reduction of corporation tax by 5 per cent. must give extra liquidity to companies in Scotland. It will be interesting to see, come September, when we have all the pension increases, the increase in the retail trade as a result of more money jingling in pockets. This will be a minor inflationary injection for Scotland. [Interruption.] It is no use the hon. Member for Kilmarnock (Mr. Ross) laughing. It is the greatest single pension rise the old-age pensioners have ever had.
  The de-escalation of wage claims is succeeding. The hourly wage rate for the last six months of 1970 was rising at 8·1 per cent. a year. In the first five months of this year, the latest figures I could obtain, it is rising at 3·5 per cent. Such a cut is a good indication of our success, slow but definite, in cutting back high and unjustified wage claims.
  Mr. John Smith Mr. John Smith (Lanarkshire. North) rose—
  Mr. Sproat: I will give way when I have finished this passage.
  I believe that we now have fewer strikes in progress in Scotland than at any time in the past 20 years. That is a result of the Government's firm attitude over industrial relations. It is beginning to show results. They are small so far, but I believe that the effect of that attitude in regenerating the economy will grow.
  Mr. John Smith: I am grateful to the hon. Gentleman for allowing me to interrupt the passage from the Conservative campaign guide to which we have been treated. Does he agree that the only discernible result of those policies for Scotland is that we have the highest rate of unemployment since we last had a Conservative Government?
  Mr. Sproat: I do not agree. What I have said shows that that is not true.
  I turn from the short-term prospect to the longer-term prospect, and here I want to say something about the Common Market. One hon. Gentleman said that he did not think that it should be discussed in this debate because we shall debate the subject next week. I do not agree. For Scotland's economic prospects, the Common Market is a vital element, and should be discussed today. The point raised by the hon. Member for Glasgow, Scotstoun (Mr. Small) about British Standard Time shows a basic ignorance. He thinks that just because something happens in Europe it must happen here, but, of course, it does not. We can go on abolishing things like B.S.T. for as long as we like when we are in the Common Market ; there is no need to harmonise everything. I would go on rejecting B.S.T. for as long as I was in the House, even when we were in the Common Market.
  I believe that Scotland will benefit, as the economy of the United Kingdom as a whole will benefit, from our entry into the E.E.C., and that Scotland will enjoy a higher standard of living, as will the whole United Kingdom. The Common Market countries have enjoyed a higher standard over the last decade than they had before. Indeed, they have overtaken this country.
  I was glad that my right hon. Friend mentioned the question of fishing. That is separate from the overall economic
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  development of Scotland. I am very glad that he made the reservations he did. which I entirely share.
  Many firms and companies in Scotland are hanging back on their investment plans until they know for sure whether we shall go into Europe. When we know for certain, we shall see a welcome increase in investment.
  My hon. Friend the Member for Galloway (Mr. Brewis) mentioned Southern Ireland and German investment. It is perhaps even more instructive to look at the level of German investment in Belgium over the past 10 years since the Common Market got going.
  Mr. Donald Stewart: How does the hon. Gentleman conclude that entry into the E.E.C. will benefit Scotland, when there have been numerous occasions in the United Kingdom context when the South-East of England has had an affluent society while Scotland has not?
  Mr. Sproat: It is generally accepted that when England was affluent Scotland might not be so affluent, but it was more affluent than before, and that when the United Kingdom as a whole hit hard times, Scotland hit appalling times. Whatever century the hon. Gentleman may be living in, we are irredeemably bound up with the economy of England and Wales today.
  I also welcome entry into the E.E.C. on the whole question of regional policy, because I believe that the European Investment Bank would be another source of funds for further Scottish development. The Social Fund of the Community would also help retraining in Scotland, which is another important factor. I believe that not a single mandatory change in regional policy as it affects Scotland would be necessary because of entry into the Common Market. We could go on exactly as we wanted in our regional policy, or change it as the House might decide. I see the hon. Member for Western Isles (Mr. Donald Stewart) shaking his head. Does he realise that France and Italy have larger development areas, not only by geographic area but by population? We shall be able to go on with our development area policy for Scotland even if we join the Common Market. One of the main objects of the

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  Community is to reduce economic differences between regions. Therefore, we in Scotland need have no fear of entry but should welcome it as a great chance to expand our economy.
  Therefore, when I consider the excellent investment incentive package we have, the possibilities of Oceanspan and North Sea oil, the overall strategy of growth that the Government are applying to the country as a whole, and the prospects that the Common Market opens up, I have every confidence in the economic future of Scotland.
  7.50 p.m.
  Mr. Dick Douglas: There were certain elements of the analysis of the hon. Member for Aberdeen, South (Mr. Sproat) which I could not share. The Secretary of State indicated that he foresaw a high level of unemployment when he came to office. I want him to look searchingly at the unemployment figures. From January to June this year, the monthly average of unemployment has been 27,000 higher than the monthly average of 1970. What are the prospects for the Scottish economy and the Scottish people in the winter of 1971–72? We should be grateful if the right hon. Gentleman could tell us that we are likely in that winter, or even in 1972, to get back to the 1970 monthly average. But we have had no such indication from the Government and unemployment in Scotland is now averaging 120,000. Can the right hon. Gentleman, in terms of post-war recorded figures, tell us of any six-monthly period when unemployment has been running at 120,000 in Scotland?
  Hon. Members opposite have put a persuasive case that the growth of the Scottish economy must be closely linked with the growth of the United Kingdom economy. I am always interested in the type of economic advice given by the right hon. Gentleman's economic advisers. I wonder how much he listens to them. Professor A. D. Campbell, professor of economics at Dundee University, writing in the Investors Chronicle on 26th May in relation to a particular regional study—and I hope I am not quoting out of context—said :
  "There is, however, no Government commitment to the expansions considered in the
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  Tayside Study so that recovery in Tayside will depend, as in most other areas, on the general recovery of the U.K. economy."
  What have we in prospect for that? The Chancellor of the Exchequer's budgetary forecast is not on tap. We are still awaiting the result of his survey. His budgetary strategy is a failure. There is no point in hon. Members opposite talking about the cut in corporation tax. Let them point out at this time the balance sheet of any Scottish company—or of any United Kingdom company for that matter—which shows cash flows capable of giving sustained investment in future. Company liquidity is still very tight. There is no indication that industry is willingly going to undertake purposeful investment, and that is regardless of whether we enter the E.E.C., because the Government in three tragic instances have sapped the confidence of industry. They have done so by their actions over Rolls-Royce, U.C.S. and the Mersey Docks and Harbour Board.
  The right hon. Gentleman pleaded, "I was there first." He is always there first. Let him go, for instance, to the Clyde Port Authority and ask those in charge whether they could raise money on the public market just now at any rate of interest, and they will tell him that the result of the Government's action over the Mersey Docks and Harbour Board has eroded the possibilities of public concerns going to the market. That is a fact. It has nothing to do with the Labour Government but is the direct result of 13 distasteful months of Conservative Government.
  We have not got growth prospects. The fires of economic growth have not been lit, and the fires of inflation have not been stilled. We have the worst of all possible worlds and the only business in which people are willing to invest is the money business. Very few people are willing to turn their money into fixed assets. That is one of the troubles with Government policy. They have eroded confidence. One can speak with a great deal of sympathy about trying to get foreign capital and foreign fixed investment into the country, but there are dangers in this and one should be alive to them. Part of the recession in the Scottish economy, although not entirely, results clearly from the fact that there has been a recession in the United States,

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  and the multi-national companies set up in Scotland during the last 10 years or so have found it expedient to curtail growth there.
  What are the Government going to do not just to get foreign investment in Scotland but to create indigenous growth? The young people who are coming on to the labour market are highly trained and highly skilled. One of the tragedies of this summer is that a lot of highly-trained personnel will be coming on to the labour market at a time of high unemployment. We have invested considerably in the past and will do so in future in training skilled personnel. What for? To be thrown on to the scrap heap of unemployment? It is a tragedy. What do the Government propose to do about that?
  There has been the erosion of regional policy as exemplified by the process of raising the level for industrial development certificates. This, too, is a tragedy. The siting of the value-added tax centre at Southend is yet another tragedy. Did the right hon. Gentleman agree to that? It was a Cabinet decision. It is not so much the number of jobs that is important, but the psychology of the decision in that the Government, when they can make a decision, choose to site a Government enterprise in an already congested area.
  Mr. Gordon Campbell: The point, as explained by my right hon. Friend the Chancellor of the Exchequer, was that the Customs and Excise is already at Southend and that if the value-added tax is to be brought in in two years' time it is convenient to use the Customs and Excise people already there. But three-quarters of the personnel are going to be dispersed throughout the United Kingdom and the figure of 10,000 which some hon. Members have produced is completely out of proportion.
  Mr. Douglas: The right hon. Gentleman has answered my question. He agreed to this decision and he has not taken into consideration the psychological effect.
  We are already paying dearly, to the tune of £150 million, for the decision to site the third London airport at Foulness. If that is linked with a port and further industrial development in order to suit
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  the powerful industrial interests trying to promote that type of project, and the right hon. Gentleman acquiesces or complies with that decision, the people of Scotland will not take kindly to it.
  Mr. Gordon Campbell: What I agreed to was that about three-quarters of the personnel are going to be dispersed throughout the United Kingdom.
  Mr. Douglas: I do not welcome the right hon. Gentleman's interjection because I have moved on from that point. Great public companies are bringing pressure to bear and are knocking on the Government's door. The people of Scotland will not forgive the right hon. Gentleman if he acquiesces to this decision.
  I take the point about the switch from investment grants to tax-based incentives. Again, I quote from the same article by one of the right hon. Gentleman's economic advisers :
  "The switch from investment grants to free depreciation has reduced the Region's attractions relative to areas without Development Area status ; and vast new areas, competitive with Tayside for new industry, have been given the greater advantages of S.D.A. status …".
  This clearly indicates that the differentials between development areas and non-development areas have been eroded. The right hon. Gentleman should bear this important consideration in mind.
  I turn to a point about a matter which is very dear to me concerning U.C.S. The Secretary of State raised this issue ; I did not intend to raise it. But I say unequivocally that the views of the S.I.B. director fell on very receptive ears on 14th October. He made recommendations to the Government concerning credits for shipowners who had ordered ships with U.C.S. I want written into the record the Answer given to me on 2nd July by the Secretary of State for Trade and Industry :
  "The Shipbuilding Industry Board Director discussed the position of the company with officials of my Department on 14th October. In the course of that discussion, he expressed doubts about whether the company should continue trading. No written communication passed between Mr. Mackenzie and the Department."—[OFFICIAL REPORT, 2nd July, 1971 : Vol. 820, c. 222.]
  I do not want to impugn anyone's professional status, but it should be clearly pointed out that there was a distinct possibility that Mr. Mackenzie, in

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  evaluating the position, would be faced with a conflict of interests. In a Written Answer given to me today, the companies in which Mr. Mackenzie held directorships were set out and included among them was Yarrow and Co. Ltd. In view of this, the Department should at least have called for documentary evidence of the background in detail.
  I may seek the indulgence and good grace of the House to raise this matter further, but I wish to put it on record that Mr. Mackenzie might have had a conflict of interest. I ask the Minister who winds up the debate to say whether the possibility of a conflict of interest was put to the S.I.B. director and whether he was asked to resign from the U.C.S. Board or from Yarrow and Co. Ltd. because it is passing strange that the only part of U.C.S. which we could be sure of saving was Yarrow Shipbuilders, which is wholly owned by Yarrow and Co. Ltd.
  8.4 p.m.
  Sir John Gilmour: One of the main points raised in this debate is whether the method of supporting industry followed by the Opposition was better than the method which my right hon. Friends are following. For the Opposition to prove their claim, they would have to show that at the end of the Labour Government's period of office, when an election was called very unexpectedly, a large inflow of jobs was being created in Scotland by the means employed by the Labour Government. I do not think that that was happening. If the jobs had been in the pipeline, they would have been coming out now. My right hon. Friend the Secretary of State is right in saying that he inherited a very difficult situation.
  We have been having debates about the all-too-high level of unemployment in Scotland since about 1958. Neither party has been able to find the answer. It is a very good thing in these debates to be a bit critical, not only of the Opposition, but of ourselves, and I hope to do this in a constructive way.
  One of the troubles is that when we give a big grant to an incoming industry which puts up a new factory there is immediately a flow of labour from established industries to it. There is also wage escalation, because the Government are
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  paying money to help pay higher wages to attract industry. In the intervening period before we go into the Common Market—and the opportunities which arise from the Common Market will certainly come, but not for some time—there is a great deal to be said for a programme for modernising and helping existing industry in Scotland. I am interested in the future and prospects for what I have. Although I should like to have enough money to buy, say, another bull, I wish to tend and foster the cattle I have. I think that the Government would be well advised to foster and improve existing industries in the period immediately ahead. This is particularly necessary because in a very short time the regional employment premium, which is bringing quite large sums into existing industries in Scotland, will be phased out.
  What can Scotland cash in on in particular? We must cash in on the deep water in the west of our country and the bridge which can be created through the port on the Clyde for industrial Scotland. How can we best set about doing this? I think that the solution lies in an injection of capital into the steel industry. One of the things which I find slightly worrying about the C.B.I. report on the steel industry—and my right hon. Friend the Secretary of State said that he had been to see the steel works at Taranto—is that by joining the E.E.C. we shall be taking part in a pricing policy whereby the steel is priced at the works and the consumer, who is at a distance from the works, will have to pay for the transport. I take it that the purpose of the steel works in Italy which my right hon. Friend visited was to attract and expand steel-using industries in the area. This is what we would have to do in Scotland.
  Another problem which I see arising from our entry to the Common Market is that if we greatly depend on an I.D.C. policy it is one thing, in an United Kingdom context, to refuse an I.D.C. for growth in the South or South-East, but what will be the position if, having refused it, the company says, "We will go to Brittany or Normandy"?
  There are some immediate and possibly short-term steps which my right hon. Friend the Secretary of State can take to help foster existing industries. One of them concerns the whisky-producing industry which will be faced with a

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  challenging situation arising from our entry to the Common Market, because the price of its raw material—cereals—will increase. Another difficulty is that countries will be very much guided by what we charge when it comes to setting their own spirit duty. This would be a very appropriate time to reduce the duty on whisky, and I hope that my right hon. Friend will give this point serious consideration. [HON. MEMBERS : "Hear hear."] I am glad that there is a certain amount of support for that. I should perhaps have declared an interest before I made that statement.
  The paper-making industry, which affects so much the East of Scotland, can look forward to a better future if we go into Europe but, on the other hand, it is facing serious difficulties at present. One gets the impression that some Scandinavians are trying by unfair competition to get the mills in this country out of production before our advent into the E.E.C., and we therefore need help there. Other hon. Members have mentioned the fishing industry. Here we have a prosperous industry right round the coast of Scotland which should not be neglected in the negotiations.
  We must have a bit of imagination. The Highlands and Islands suffer greatly from the high cost of transport, and I see no reason why the Chancellor of the Exchequer should not reduce petrol duty on all islands. No one who lives on an island has free access to the road system of this country. An islander has to pay a heavy charge to come over on a ferry before he has access to the road system. Since the people living on islands do not get full value from the road system they should not be charged the full pertol duty. If we do this the people in the Highlands and Islands will feel that the Government have some imagination, and do not have the civil servant's "same all over the country" attitude which most Governments of the past have had.
  A matter which concerns my constituency is the sugar beet factory in Cupar. This is a hardy annual which I have brought up many times. There has been a feasibility study into the possibility of someone other than the British Sugar Corporation running this factory. We know that on entry into the E.E.C., after the Commonwealth Sugar Agreement ends, 400,000 tons of sugar will either
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  not come in or will come in after payment of a higher duty which will adversely affect our balance of payments. This is equivalent to 200,000 acres of sugar beet grown either in Europe or elsewhere, and the farmers in Fife and the East of Scotland have agreed to support the factory if a change can be made so as to allow private enterprise to take part in this essential industry.
  With higher cereal prices if we go into the Common Market there will be a greater need for a break crop in Scottish agriculture. I remember my hon. Friend the Parliamentary Secretary to the Ministry of Agriculture, saying that the price of wheat would be such that people would be growing it on the top of Ben Nevis. If this happens and there is increased cereal production the need for the growing of sugar beet will be all the greater.
  I am fairly certain that our economic difficulties will not quickly be overcome. We read in the newspapers about Pan-American and T.W.A. having to merge, and the possibility of continuing the RB211 seems to be fading every day. Perhaps it is wrong to cry woe but, on the other hand, it is better to face the dangers and difficulties and be prepared for them. I suggest that something could be done in the short term between the Department of Social Security, my right hon. Friend and the Minister of Defence. I cannot believe that there are not some items of defence which normally the Exchequer says there is not enough money to buy. If we have to pay out huge sums in social security to skilled men for doing nothing, would it not be better to calculate whether, as a bridging operation until new industry is brought in, some useful equipment for the State could be procured? By doing this we should be utilising the labour and creating a useful asset.
  8.14 p.m.
  Mr. John Rankin: I agree largely with what the hon. Member for Fife, East (Sir J. Gilmour) said but I remind him of the need to provide movement and jobs for people. There is a continuing movement of people from the Western Islands over to the mainland. If we do not satisfy the economic and social needs of the people who live in these less attractive parts of the country, those people will

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  not wait, because the attractions are too few and the transport arrangements, whether by surface or by air, are in sufficient. I hope that the Secretary of State is taking note of these matters. He has heard of them already. If we are to preserve the distribution of population more equitably throughout Scotland we must provide jobs, attractions and all the other amenities of life to keep people living in the areas which tend to be depopulated.
  Sir J. Gilmour: On this transport question, does not the hon. Gentleman agree that one can buy a fortnight's holiday in Majorca more cheaply than a return ticket to Stornoway?
  Mr. Rankin: That is an even stronger criticism from a supporter of the Government than I as a critic of the Government have made, and I trust the right hon. Gentleman the Secretary of State will pay close attention to that.
  The hon. Member for Aberdeen, South (Mr. Sproat) said that he was a supporter of entry into the Common Market. I, too, am a supporter, because I think Scotland has a better chance of economic freedom in the Common Market than she has at present. Scotland is too much under the control of the wealthier and more powerful country with which she is allied. On the flight from Glasgow to London, from the time one leaves the Lake District there is scarcely a single bit of England that is uncultivated and scarcely a big town which is not very close to another big town. So here we have a mass of people, a mass of work and a mass of wealth that Scotland cannot equal because she has not the physical backing to create that wealth. Consequently, in parts of England such as Coventry and the Midlands we have established great Scottish populations, Coventry is almost a Scottish city. Our workers have gone to that city from Scotland seeking better homes and better wages than they can get in their home country, and what is happening is that they are dissociating themselves almost completely from Scotland. Scottish communities are being established in England because Scotland has not been able to provide her own people with a sufficiently attractive livelihood.
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  Our Scottish business men have been seeking to break this English control—I say this without wishing to be offensive—by establishing their own business contacts with the Continent. Those business men have been in direct contact with customers in Europe and have sought to ease the situation by trying to get air services started so that the various business representatives can fly between Europe and Scotland to sell Scottish goods and promote Scottish industry in Europe. They have been doing this for quite a while. I have raised this matter on two or three occasions and have had absolutely no encouragement, because every bit of business that leaves Glasgow and Edinburgh to go into Europe in order to promote Scottish industries must go through London. Nothing can be done as between Glasgow and Western Europe without first getting the permission of London. That is one powerful reason in my view why we should support the Common Market—[Interruption.]
  Mr. Deputy Speaker (Sir R. Grant-Ferris): Order.
  Mr. Rankin: Mr. Deputy Speaker, I am not aware that it is an offence to give a reason for one's views. I have given only one reason.
  Mr. Deputy Speaker: I am seeking to put to the House that the hon. Gentleman should be allowed to make his points in his own way.
  Mr. John Robertson: On a point of order, Mr. Deputy Speaker. Surely a Member of the House is allowed to make known his reaction to a comment by one of his hon. Friends. It is surely not an offence to make that comment.
  Mr. Deputy Speaker: It is perfectly correct that an hon. Member should be allowed to make his comment, but I hope that the hon. Member for Glasgow, Govan (Mr. Rankin) will not be diverted by any other comments.
  Mr. Rankin: I apologise, Mr. Deputy Speaker. I accept the comment of my hon. Friend the Member for Paisley (Mr. John Robertson) in the same spirit as I hope he will accept my comments. It is because I feel that it is necessary to try to get direct Scottish connections with European countries that I and many other people favour the Common Market.

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  I hope that this will succeed in giving us a certain amount of liberation for which we have waited so long and which we so badly need. Every one of us, whatever our views on the Common Market, knows that Scotland has not advanced as rapidly as it should in filling up its empty spaces. We all know from our service in the Scottish Grand Committee the problems facing the Scottish economy, and this is one of the basic reasons for the continuing exodus of our young people from Scotland. We must do all we can to keep those young people in Scotland so that they may help to develop their own country and so increase the prosperity of the United Kingdom as a whole.
  8.24 p.m.
  Mr. Hamish Gray: I go a long way with certain comments made by the hon. Member for Glasgow, Govan (Mr. Rankin), and I hope to deal with some of them a little later in my speech.
  Somewhat unusually, I disagree with some the the remarks which were made by my hon. Friend the Member for Perth and East Perthshire (Mr. MacArthur). I do not agree that the future prosperity of Scotland necessarily depends entirely on the prosperity of the United Kingdom. It is a pity that this has always been regarded as a foregone conclusion. What happens in times of prosperity is that in Scotland the prosperity is a little less marked than in other parts of the United Kingdom. Conversely, in times of depression the effects are infinitely worse in Scotland than elsewhere.
  I agree with those who have suggested that the balance could be rectified if further oil strikes are made off our shores. A tremendous future lies ahead for our country if such oilfields are developed, and I hope that royalties from these finds will be more evenly distributed than has been the case in the past.
  The ailments of our economy are not easily diagnosed. I do not agree with those who suggest that all our troubles emanate from the period 1964 to 1970; they go back a good deal earlier than that. However, I suggest that the previous Government's policy instead of rectifying the situation only accentuated the deficiencies.
  The system of investment grants has been discussed at length and my only criticism
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  of grants is that so often they were given to companies which were expanding from elsewhere. Therefore, in hard times the first places to be closed down are those in the furthermost parts away from the original company, and consequently Scotland has been the sufferer.
  I do not intend to deal at length with unemployment since it has been fully covered by hon. Members on both sides of the House. Since there are still many hon. Members who wish to take part in this debate, I do not want to be drawn too widely on that subject. I am sorry that the right hon. Lady the Member for Lanary (Mrs. Hart) is not present at the moment since she made one or two accusations against the Government which should be investigated. She referred to the transport system being pursued by the present Government, but omitted to point out that the transport policies pursued by the Labour Government did nothing to help the situation in Scotland. I can think of few occasions when a Bill created more disquiet in Scotland than did the Transport Bill introduced by the previous Government.
  I agree with the right hon. Lady that the situation in regard to regional policies is extremely worrying. In spite of assurances given from both sides of the House, people are still gravely worried about the effect on regional policies if we join the E.E.C. There are few comments on regional policies in the White Paper. While I do not want to be distracted by the subject of the E.E.C. at this stage, many of us will want to ask questions about the regional policy when the appropriate time comes next week and in the months ahead.
  Since becoming a Member of this House, I have been somewhat depressed by the perpetual attacking of each other's past policies that takes place. It does not seem to matter which department is taking part in a debate. A great deal of time is spent from both Front Benches lashing the policies of the other side. Il is purely as a means of defence that it occurs so often, and one side is as guilty as the other. But, at a time when we should be combining in the interests of Scotland to try to solve the problems of our economy, it is a pity that we spend so much time hammering one another.
  I believe that the Government are trying seriously to control the cost inflation

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  which has hit industry in the past years. Certain hon. Gentlemen opposite would be well advised to support the Government in their efforts instead of trying to stir up matters in places outside this House. That needs to be said, and I have no hesitation in saying it.
  Mr. James Sillars: Members of the Conservative Party really must stop this nonsense. The people who began the argument that wages were chasing up prices were the leaders of the Conservative Party, and they did it in page 11 of their manifesto under the heading, "Steadier Prices".
  Mr. Gray: The problem of prices has been gone into fully today, and my hon. Friend the Member for Aberdeen, South (Mr. Sproat) made a very interesting comparison in figures showing how the Government already have started to get on top of the problem. We appreciate that it cannot be solved overnight—[Interruption.] The hon. Member for South Ayrshire (Mr. Sillars) is entitled to his opinion, of course.
  The new policies that the Government are pursuing will take time. The Government accept that they are bound to take time. We cannot expect miracles overnight, but we are confident that these policies will succeed, As time goes on, hon. Members opposite may have a fair amount of word-chewing to do.
  S.E.T. already has been halved, and it will be abolished altogether in 1973. Considerable encouragement has been given to the steel industry recently with the announcement about Ravenscraig and the close co-operation now going on between the board and the Government will be to the benefit of the industry.
  The subject of Hunterston has been dealt with thoroughly. One of the disadvantages of speaking in the later stages of a debate is that much of what one wanted to say has been said already by other hon. Members. A number of hon. Members have referred to special development areas, and the announcement about increases in road programmes and housing grants will be received with delight throughout Scotland.
  The problem is not as simple as that, however. Until such time as we can attract investment, whether it be foreign
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  investment or from within the United Kingdom, Scotland will still be up against it. I do not agree with the hon. Member for East Stirlingshire (Mr. Douglas) that this Government have damped out any hope of investment taking place in Scotland. It is fair to say that investment had been very slow for a number of years before my right hon. and hon. Friends came to office. There was a great deal of apprehension, and right hon. and hon. Gentlemen opposite must accept their share of the blame.
  I believe that Scotland has a very great future. I am not despondent about it. But it requires the maximum co-operation on both sides of the House to create in Scotland the will to succeed and the knowledge that success can be ours. I hope that all parties will contribute to this in due course.
  8.34 p.m.
  Mr. Donald Stewart: The hon. Member for Ross and Cromarty (Mr. Gray) made one or two valuable points, although I did not agree with all of them. He brought out the fact that Scotland has not automatically come into line with improvements in the economic situation in England. We have seen many occasions of that in the past.
  I was quite unable to follow the reasoning of the hon. Member for Aberdeen, South (Mr. Sproat), to whom I am grateful for giving way on one occasion. I am sorry that he did not give way to me the second time. If he had done so, I should have raised with him the point about assistance to development areas in the Common Market. Recently, I raised with the Chancellor of the Duchy of Lancaster the fact that the Brussels Commissioners had ordered the Belgian Government to desist from giving assistance to a development area in Belgium. The right hon. and learned Gentleman has confirmed in a letter to me that they cannot do it without the approval of the Brussels Commissioners. This seems ominous for Scotland, which has already suffered enough from remote control in the present set-up. We shall be much more remote if and when we enter the European Economic Community.
  It is correct, as the hon. Member for Fife, East (Sir J. Gilmour) said, that it does not behove hon. Members on

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  this side to make the case for the prosecution against the Government. I am in general agreement with the Motion, that the Government have failed and are failing, but I do not think that the Opposition have any great grounds on which to attack them.
  The right hon. Member for Kilmarnock (Mr. Ross) during his period of office as Secretary of State for Scotland, and the right hon. Member for Argyll (Mr. Noble) before him, talked about jobs in the pipeline for Scotland. Alas, as usual, it turned out not to be a pipeline taking jobs in, but a drainpipe draining jobs away. A well-known editor in the North of Scotland has said that for Scotland it is always better news tomorrow, and tomorrow never comes.
  Although the Labour Government did not sent out the signal "Every man for himself", the fact is that at the end of their term in office Scotland had 82,000 jobs fewer than at the start. The Scottish unemployment figure is 45 per cent. up on the position a year ago. In passing, I point out that the current rate in England is 2·9 per cent. It is five years since Scotland has had an unemployment figure as low as that.
  Both the Labour and the Conservative Governments have put forward policies which have damaged Scotland. However sensible or rational these policies may have been for England, they were disastrous for Scotland. We have on many occasions recently had to take unpleasant medicine for what was primarily an English disease. We never came in on the affluent society ; we never suffered from too much employment. We knew nothing about these problems.
  I was sorry that the Secretary of State for Scotland mentioned, with approval, that we were getting various defence installations in the West of Scotland. We have far too many of these now. We have the Polaris base which Norway, although a member of N.A.T.O., refused to accept. It is time that this was taken out of Scotland, particularly from a heavily populated area. [An HON. MEMBER : "Send it to Foulness."] That is a very good idea, but I do not think that it would be accepted by Foulness. We have a rocket and gunnery range in Galloway. To regard these matters as a solution for unemployment seems a dread-
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  fully anti-social policy. It is almost like saying, "Let the crime wave expand so that there will be plenty of work for the police." Is that the kind of work we want in Scotland? Certainly not.
  The hon. Member for Edinburgh, South (Mr. Clark Hutchison) asked some very pertinent questions. He asked : Why is Scotland suffering in this way? Is it that our people are work-shy? Do we lack the financial acumen? The hon. Gentleman answered all these questions satisfactorily, but he left out the most important answer of all : namely, that we are suffering in this way because we lack a native Government to look after Scottish interests. That is why those who have mentioned oil are wrong. Without any claim to second sight, I can tell the House that the oil will flow south and that Scotland's share will be very small indeed.
  I appeal to the Government, in the short term, to adopt the five-point Toot-hill plan. This would help to get over the immediate situation. I also ask them to give the go-ahead for the Hunterston programme. Nothing would do more to restore confidence in Scotland and the Scottish economy.
  8.40 p.m.
  Mr. Alexander Wilson: Having listened to the debate from its commencement I can only say that speeches from the Government benches constitute nothing but a huge smokescreen, designed to divert the attention of anybody who cares to look at the words of the Motion.
  I do not want, and my constituents are not keen, to listen to airy-fairy notions, however great they may turn out to be in the future, about getting oil from the North Sea. This is essentially a censure Motion on the Government who have gone into stagnation since June of last year. They have not only stagnated in their policies, but they have allowed themselves to slip back to such an extent that there has been an increase in unemployment in Scotland which is un-precented since the end of the last war. This smokescreen is no longer effective against the people of Scotland, as results in national and local elections have shown, and will continue to show until we get rid of this Tory Government.

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  In my constituency a fear is developing about something that I warned would happen when Rolls-Royce collapsed. There is fear about huge increases in the unemployment rate. When I refer to unemployment I am talking, not about figures, but about people. I am talking about men, women and children who have the right to work and the right to live in some dignity.
  In Hamilton, in my constituency, in one year the male unemployment figure has risen to 1,290. In Blantyre it is 491, and in Larkhall it is 410. The same sort of picture is being created by the Government in other areas. The figures are the result of the Rolls-Royce collapse, and yet the Secretary of State this morning blandly announced an extra £8 million for road building.
  Will the right hon. Gentleman tell the Rolls-Royce workers that this great public works programme is available to them? These are men with skills that have been gained over a lifetime of service to this country. In Hamilton there is 37 per cent. unemployment among skilled workers. In Blantyre the figure is 33 per cent., while in Larkhall it is 44 per cent. The figures do not lie. The figure for the long-term unemployed has increased in this short period of 12 months to such an extent that it is now 23 per cent. in Hamilton, 24 per cent. in Blantyre, and 20 per cent. in Larkhall.
  Of course this censure Motion is essential. When the Government were elected last June they were supposed to be ready to rejuvenate the economy. They were supposed to be ready to cut unemployment at a stroke. They were supposed to be ready to cut prices at a stroke. Of course the Government should stand condemned, and any hon. Gentlemen opposite who supports the Amendment shows very little feeling for the people about whom we are talking, the unemployed. They find themselves unemployed, not through any fault of their own, but because of the sheer apathy of a bad Government.
  I listened, in the Secretary of State's opening speech, for some expression of compassion for the people, but failed to find it. In my constituency in particular, the picture now developing can be compared with the 1930s. That picture shows
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  a soulless Government, who are deliberately legislating to show direct profit to their ever-narrowing circle of friends.
  They are legislating for insecurity among the people who made the wealth of this country, but who, alas, have never had the opportunity to share in that wealth. The past 12 months have shown a decline in the growth of investment. In Lanarkshire alone we talked about £4 million or £5 million worth of investment. Only £6 million of this sum came from Scottish industrialists. The remainder came from overseas. Industrial development certificates are almost forgotten by industrialists. There is stagnation in the economy ; there is a feeling of despair among the workpeople, a hopelessness at not being able to obtain employment. It is important that we should understand the feelings of those people.
  In about six or seven days' time most of the workpeople in my constituency will be on holiday. I wonder if anyone on the Government Front Bench has ever been in the position of having to explain to his children that there would be no holiday for them. How is a child told that there will be no holiday? How does a mother explain to her children that they cannot have the little treats to which a child is normally entitled? How does a father explain that he cannot provide for his own family, through no fault of his own? The biggest blow to working men and women is deliberate legislation by which they lose their dignity If there is one thing that we on this side of the House will defend with everything we have it is our dignity, our right to work and provide for our families. The Government stand condemned in the words of the Motion. Every vote against the Motion at ten o'clock tonight will be reversed the first opportunity the Scottish people have, the first opportunity the English people have and the first opportunity the Welsh people have. We shall return a Labour Government which will believe in people and not profit.
  8.50 p.m.
  Mr. W. H. K. Baker: In a debate of this type one naturally likes to refer to conditions in one's own constituency, and this has been so today. I

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  should like to refer to the three main industries in my constituency, fishing, agriculture, and, a notable industry, whisky.
  The country faces the prospect of going into the Common Market quite shortly. The farmers are content. Whether hill farmers or lowland farmers, there is a big opportunity for them, and we have been assured by the Government—and this is in the White Paper—that conditions for hill farmers will certainly be protected, and that is a cause for great satisfaction.
  But question marks hang over the distilling industry. There are more distillers in my constituency per acre than in any other constituency in the United Kingdom. The distillers have many doubts about the possible adverse effect of V.A.T. In recent years there has been an upsurge in distilling, with vast exports of whisky to the United States of America. Without that valuable market the distillers would be in bad trouble. I hope that tonight my right hon. Friend will make some comments on the application of V.A.T. to whisky, or at least let me know when that information is available.
  The third main industry, fishing, has been doing pretty well of late because of the action of the Conservative Government in 1964 when it extended the fishing limits. I refer to the inshore industry. It is largely due to the economic measures by the previous Conservative Government that this happy state of affairs has come about.
  But fishermen are worried about the future. Where there is a fishing industry there are ancillary industries, such as boat building, and for various reasons, not least the imminent application of Common Market rules and regulations, there is anxiety about the future. Unhappily, the result is that order books in the four boatyards in my constituency are thinly occupied, if order books can be thinly occupied. I hope that within the next two or three months we shall be able to get satisfactory negotiations in Brussels so that the future of this immensely important industry is assured, because until we have stability in the industry, we shall have uncertainty in the boatyards and in the industry itself.
  In a supplementary question. I suggested to my right hon. Friend the Foreign Secretary yesterday that the Government
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  should reconvene the 1964 Fisheries Convention, together with Norway, which was not a signatory. If we could get the Convention reconvened, away from the Brussels negotiating table and outside the atmosphere of the present negotiations, it might be possible to obtain a solution which would be equitable to all United Kingdom fishermen, and not least to the inshore industry. There is uncertainty at the moment and the sooner we can get stability in this respect the better.
  The economic situation in my constituency, because things are going well in the fishing industry and agriculture, is not too bad. In other words, the rate of unemployment is not desperately high. I hope, however, that there will be an improvement from the fishing point of view so that the crews will be forthcoming We will then be able to continue to have a prosperous fishing industry.
  8.57 p.m.
  Mr. John Robertson: Today I heard the most dreary, dull and irrelevant speech that it has ever been my misfortune to hear from a Secretary of State for Scotland. Faced with a serious crisis of unemployment, short-time working and redundancy—in other words, a crisis of confidence right across industry in Scotland—the right hon. Gentleman stood at the Dispatch Box with a silly grin on his face and tried to assure us that everything would be all right once we were in the E.E.C.
  I do not know what that has to do with the immediate problems that we in Scotland face or how they will be solved quickly. I want to hear about the Scottish steel industry and shipbuilding north of the Border. Six months ago we were being told all sorts of things about industry being attracted to Scotland. Where are these expanding industries? At present we see electronics and computer firms closing down. Where are the industries that were to take us into the space-age?
  The Secretary of State said that he deplored the high rate of unemployment. One might be forgiven for believing that he was trying to kid us. Either the right hon. Gentleman who is a Minister of Cabinet rank is not privy to the decisions of this Government—that he knows nothing about them and is not consulted—or he disbelieves the briefs that are put in his hands. I believe it is the

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  former. I do not think the Secretary of State for Scotland counts any more. I have concluded that he is not listened to and that the case for Scotland is not heard where the decisions are made.
  The logic is—and hon. Members who are arguing in favour of the E.E.C. should heed this—that Scotland must have its own Parliament. If things continue as they are the Scottish people will make this demand because it will seem the only solution. A lot of monkeying about with regional policies will not solve anything. Hon. Members on both sides must beware, in any event, about using the word "region" to describe this nation that is Scotland. How can one argue on behalf of the Scottish economy and in the same breath talk about a regional policy? The two are contradictory.
  I wanted to hear about the steel industry. I wonder if the right hon. Gentleman the Secretary of State has been to Scotland to inquire about it. We do not know from his speech today. But we know that he has been to Southern Italy, as a great many of us have, on what my hon. Friend the Member for Glasgow, Scotstoun (Mr. Small) calls the gravy train, taking free rides, free drinks and free eats, to see this marvel of the Common Market, the steel works, away in a desert, and enjoying it very well. With the sun shining and with time off, that is lovely.
  I wonder how many right hon. and hon. Gentlemen opposite took the trouble of not only looking at the steel works but going to Brindisi and having a look at some of the slums and seeing the low standard of living. It is shameful to see the dreadfully shocking condition of the people in that area. This single steel works is put up as the salvor of all the people in southern Italy. We all know that it is not. They live in shameful poverty that is a disgrace to any nation and to Europe. Is that what the right hon. Gentleman offers as a solution to Scotland's problems? He says, "We shall be all right, boys, if we join the Common Market. American firms are running about looking for a place to build a factory. They will come to Scotland. "One wonders, why not Southern Italy, where they have built the steel works? Why build in Scotland
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  when they have the steel works in Italy? They cannot get anyone else to go near the steel works in Italy. Perhaps they melt the products down and re-roll them. It is a wonderful prospect. We suggested the solution to the problem in Scotland some time ago. One could build the ships at John Brown's, break them up at Gare Loch and start building again at John Browns. That is the kind of solution being presented by the right hon. Gentleman.
  For goodness sake, let us get down to an appraisal of the problem. The hon. Member for Edinburgh, South (Mr. Clark Hutchison) tells us how he has wondered over the years why it was that this intractable problem we have all tried to solve for so long has never been capable of solution. It has to do with the centre of Government, or, at least, with the modern phenomenon, which is true of all countries, that once one builds up very large conurbations of people and industry, of their own free will and their dynamic, they seem to keep growing and to draw in people and industry from the peripheries. That is true of this country, of America and of the Continent. This has happened within Scotland and is happening with Scotland in relation to London and the rest of Great Britain. The population of Ireland, North and South, has been sucked in, as has that of the North and the South-West of England and that of Scotland.
  But if we join the Common Market a new magnet will be created, a new concentration of industry and population, and the process will begin again. Not only will it be difficult to deal with Scotland's problems in relation to the rest of the United Kingdom, but, if we are a member of the E.E.C. it will be infinitely more difficult to deal with Scotland's problems in relation to the concentration of population and industry in the Paris-Milan complex.
  It is not a problem that we shall attract American capital and we can go into Europe and sell our goods. Has it ever struck anyone that this means that the industrialists from Europe can sell goods in Scotland? So often we have been told that they are better at it than we are. What chance do we stand then?
  Give us a solution to the problems of unemployment in Scotland, and not a lot of excuses that my right hon. Friend the

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  Member for Kilmarnock (Mr. Ross) is responsible for all the ills and that the Government have only had a year to cure them. What a dreadful thing it is for the Minister to come to the Dispatch Box to say that.
  I hope that the Minister for Trade will have a little more cheering news to give us. He should at least try to convince us that he knows what he is talking about.
  Mr. Speaker: It was at 22 minutes to six that back bench Members first had a chance of joining in the debate. Since then, in just under 3½ hours we have had 18 back bench speeches, an average of under 12 minutes each. I thank hon. Members very much indeed for their cooperation.
  9.5 p.m.
  Dr. J. Dickson Mabon: I think that we would wish to congratulate you, Mr. Speaker, on the way in which you have regulated our proceedings.
  This has been a very useful debate. As Scots we can congratulate ourselves on having £25 million more than we had when we started the debate. If we had not had the debate perhaps the programme would not have been announced. Today we had a short debate in the Scottish Grand Committee when more work was announced, adding up to £33 million. Not bad for an Opposition in one day. Undoubtedly, without pressure of this kind on the irresponsible Government that we have we would get nothing at all.
  I must congratulate Mr. Innis Macbeath of The Times. What prescience!. He told us several days ago that the Government were about to announce programmes of, not £33 million, but £100 million, but that was for the whole country, and the Scots would get one-third. He was right. Mr. Macbeath said also that the estimate of jobs that might be expected from that would be about 16,000.
  It is in that context that we are discussing what the Government have announced, which is part of their defence against this Motion of censure, because that is what we are debating. The Government have tabled an Amendment which says, "This is not fair. We have done two great things. We have set up
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  the S.D.A. and we have given other strong regional incentives since we came to power. So you cannot vote against us because of these two things."
  If ever there were an action which proved the Motion of censure, it is the Government's concession of a £33 million injection into the economy. It is a self-confession that all is not well. The Government know that they are in very great trouble. So, despite the Amendment, the announcement of a substantial public works programme has had to be made. We do not know how substantial it is because Conservative Governments have bad habits of losing the way with these programmes. So we must all monitor the Government and ensure that this programme comes into full reality and that it is a valid programme.
  At best the programme will give us 16,000 jobs or so. At the moment the figure of unemployment is 37,000 higher than it was last year. So no question arises that this is the solution and that the Opposition should withdraw the Motion of censure. It is not good enough.
  Therefore, we have to carry on with the debate and look at the Amendment. The Amendment seeks to defend the Government's position by maintaining two propositions that one can identify—first, the S.D.A. and, second, the other regional incentives. In a few days, by the way, we shall have the July figures, as my right hon. Friend the Member for Kilmarnock (Mr. Ross) said. Maybe the figure of unemployed will not be 37,000 more ; may be it will be even more. I hope not, but one must measure that against the 16,000 jobs which this £33 million programme means.
  I wonder how many of the 7,885 carpenters, builders, joiners, and so on, out of work since the Conservatives were elected will get some share of these jobs. I wonder how many of the 13,000 unemployed in the civil engineering construction industry—one-sixth of the entire labour force—will scramble for these 16,000 jobs.
  It is not good enough to be satisfied with this. The hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) said that it was a palliative. The hon. Gentleman is right on the ball there. That is all that it is—a palliative to deal with

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  a situation symptomatically—not radically, not fundamentally, but symptomatically. It is not adequate to the needs.
  Tonight the right hon. Member for Argyll (Mr. Noble), whom we welcome once again to our debates, returns to the scenes of his old crimes. We remember him very well when he was Secretary of State for Scotland. On 26th October, 1962 the right hon. Gentleman said this at Strachur :
  "I do not see the problems of Scotland being settled in a couple of months, but during the next year or so."
  The right hon. Gentleman was right. Not from that right hon. Gentleman any of the overnight nonsense that we get from the present Secretary of State. After all, a night to him is not even 13 months. All nights are long for the Tory Party. Perhaps it has something to do with British Standard Time. I do not know. But the right hon. Member for Argyll was right. He took up office in 1962, he made that statement at Strachur, and by October, 1963, he was presiding over a Scotland with 100,000 unemployed. Then, with that panache which we all associate with him, with his yellow silk waitcoat, striding over Scotland—
  The Minister of Trade (Mr. Michael Noble)The Minister of Trade (Mr. Michael Noble) indicated dissent.
  Dr. Mabon: I correct that then—he announced his White Paper for Central Scotland. There was no mention of the Highland, of the North-East or Tayside. He was very much like the present Secretary of State who, in two major economic debates, in February and today, never mentioned the Highlands once. That programme for Scotland in 1963 was about Central Scotland, not about North.
  Now, the right hon. Member for Argyll comes on the scene to defend the Amendment. He has to defend the success of the special development area. That is what we are told—that it has been a great success. In fact, 20 men in that area are chasing every Clydeside vacancy. That is the proportion of men out of work and trying to find work. We have never had its like since the war. My constituents, who have long memories of unemployment, tell me that they cannot recall such a time, unless they go back
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  to 1935, 1936 and 1937. It is as bad as that.
  Some hon. Members have complained that their constituencies are outside the S.D.A. My right hon. Friend the Member for Kilmarnock talked about Irvine, Ayr and so on. I say this is consolation to those who are outside the S.D.A. and who feel out in the cold : it is freezing inside the S.D.A. There is no need to be jealous. Nothing is happening. Industry is not on the move. That is why the S.D.A. is not working. In itself, the S.D.A. is a good concept, but it is not working because industry is not on the move. However one may try to frame regional incentives, as they are called—or national incentives, to take the point made by my hon. Friend the Member for Paisley (Mr. John Robertson)—and however one may describe them, they do not work under any Government, with any system, unless there is growth in the economy as a whole. Whether it be the economy of a country or the economy of a continent, it still turns basically on the question of growth, and that is where the Government have failed.
  I am helping the right hon. Member for Argyll. He must defend the success of the S.D.A., and he will, no doubt, tell us of the upturn in the I.D.C. figures. The Secretary of State almost pre-empted the argument by saying that one cannot judge on six months. He is right, but that is the point at which poor Argyll has been asked to defend the Government's performance tonight. [Interruption.] Yes, poor Argyll, certainly, for I should not like to have to defend such an impossible case.
  Mr. Gordon Campbell: I must remind the hon. Gentleman that the S.D.A. has been in existence for only four months. He talks about six months.
  Dr. Mabon: But the right hon. Gentleman was most anxious to impress upon us that there was an upturn. The number of industrial development certificates, he said, was showing it. He has to produce some evidence to the credit of the Government to show that their policies are working.
  One hon. Member said that a Budget is helping. It takes a while to work its way through, we were told, I think, by the hon. Member for Aberdeen, South

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  (Mr. Sproat). Which budget is he talking about?—yesterday's budget, today's budget or tomorrow's budget? Is it October's Budget, yesterday's Budget, which we had some talk about earlier today? Is it today's Budget, the one which we have just voted on, or is it the budget which we shall hear about shortly when the Chancellor finishes the July review?
  In the October Budget, we had a housing cut of £10 million, rising perhaps to £20 million. We shall hear about that tomorrow. We were also told in the October Budget that quite a substantial amount of money—nearly £60 million—for various activities in industry was to be struck out from the Government's programme. We now learn from the announcement today that some of the housing cuts of the October Budget are cancelled. After all that chopping and changing we are back where we started, except that the Labour Government are out of office and the unemployment figures are substantially higher. The same programmes are adopted at the last minute, but they cannot have the same effect because it takes time for these changes to make their way through the economy.
  A number of hon. Members referred to the treatment of U.C.S. I represent a constituency which has a shipbuilding group of enormous reputation and great success. There is no question about its viability. It has a first-class labour force, and there is no doubt about its management, which is very sound and aggressive. It is building one of the largest yards in the United Kingdom, and it has a tremendous future. We are very sad about the position of Upper Clyde, and take no joy in it at all. The men made redundant will shortly be coming down for the jobs that my men have, so there is an economic threat as a result. The Government have done an incredible amount of damage to the name of Scotland and the name of the Clyde.
  Mr. MacArthur: No.
  Dr. Mabon: Yes. When my managers and men go abroad to get orders they are not asked, "Are you from the Upper Clyde or the Lower Clyde?" People overseas know only about the Clyde. I am telling the Government to stop knocking them, and the hon. Gentleman should
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  do so as well. I will come to the Secretary of State's involvement in a moment. The knocking must stop, and U.C.S. must be taken out of its present predicament. It must be put back into solvency and activity without further damage to the name of Clydeside or Scotland. The whole U.C.S. affair has been extremely badly handled from the point of view of our country, our industry and reputation.
  As a matter of personal honour, the Secretary of State has an obligation to answer this question and not dodge it : did he or did he not see the so-called Ridley Plan? If he did not—and I suspect that he did not—he should say so.
  Mr. Campbell: I have already said so in answer to a question. The hon. Gentleman must be deaf or blind. According to the Press, it came out when we were in Opposition—it was produced by my hon. Friend, if he produced it, long before we came to Government, and as far as I know I have never seen it.
  Dr. Mabon: Now we have it clearly at last. The right hon. Gentleman revels in all his plans. For example, when in Opposition he could say that the Conservatives would have not investment grants but investment allowances. He admitted today that when they came to power they abolished investment grants without examining our report and seeing what the officials thought. [Interruption.] This is in HANSARD ; I ask the House to look at HANSARD tomorrow. The fact is that he did abolish investment grants. All the evidence from the Continent, from those countries which employ regional development instruments, shows that they prefer grants to allowances. Again, I appeal to HANSARD. I ask hon. Members to look at the Prime Minister's answer today when, pressed on whether he would accept grants rather than allowances, he said that in certain circumstances he might. The right hon. Gentleman was privy to a plan about allowances and grants. Is he now telling us that he was not privy to the Ridley Plan?—[An HON. MEMBER : "He is too unimportant."]—Maybe he is. The right hon. Gentleman must make up his mind. Either he was involved or he was not. Whether or not the Ridley Plan was an article of policy by the Conservative Opposition equal to that of investment allowances and grants, it has had the same effect as if it were

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  an article of policy. When we read the plan we see that everything has happened precisely as it said it would—what the Conservatives were to do in office, how they were to achieve it, the stages by which it was to be achieved, how various parts were to be broken off and how the labour force was to be rationalised. It is all there in black and white. The right hon. Gentleman does not have to go to the crystal. It is in the book. It is perfectly clear.
  We are still in the middle of the U.C.S. crisis. As one who has recently been in the United States and has discussed the matter with members of Congress, I can assure the Government that we are facing a tough proposition on the question of the RB211 engine and the future of Rolls-Royce in Scotland and in Britain as a whole. Where are the 16,000 jobs announced today when one considers the position in Scotland and what the demands are?
  Mr. MacArthur: Would the hon. Gentleman recall some significant words used by the right hon. Member for Bristol, South-East (Mr. Benn) in evidence about U.C.S. to the Select Committee on Scottish Affairs in 1969? He said :
  "My own view is that if we had at any stage even now said 'We will give you whatever you need' we should have deferred the vital decisions that had to be taken by the company to staunch the losses and we should have begun a permanent subsidy of a company that would then ultimately have collapsed in conditions of great tragedy for those involved, at the expense meanwhile of the viability of other shipbuilding groups."
  Will the hon. Gentleman read that and think again?
  Dr. Mabon: If the hon. Gentleman had attended our debates and listened to my right hon. Friend the Member for Bristol, South-East (Mr. Benn), he would know that my right hon. Friend answered that and has done so time and again.
  Mr. MacArthur: I was here.
  Dr. Mabon: Then the hon. Gentleman should have listened. Again I appeal to HANSARD. Three times I have appealed to HANSARD and I hope they are listening. The record will be right and the hon. Gentleman will see that these things were said.
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  The right hon. Gentleman and his colleagues cannot escape the fact that, however large the problem was, their handling of it has been disastrous to the name of Scotland and the name of the Clyde and they have got now to make amends. I want to suggest a number of things that should be done in the Government's new frame of mind in trying to salvage a very difficult situation.
  First, they should stimulate the economy. I hope that that will come in the third budget this year. So much for management by business men ! We have had three Budgets in one year. Secondly, I hope, in the light of what the Prime Minister said today, and with all the evidence before our eyes in our own constituencies and among the business men we talk to, that the restoration of investment grants will be recognised as an absolute necessity. The third need is to look at the housing programme, which has fallen by 14 per cent. It should be increased dramatically. House improvement grants are no substitute. We should get back to the 44,000 figure we were achieving in our final years of office.
  Fourthly, the training centres are not being properly recruited and filled. A big effort should be made to get the men who are unemployed into the centres to get new skills. But, of course, let us match those skills with jobs. That brings us back to the fundamental point, and my fifth suggestion is that it is high time to initiate better training for management in Scotland, which is not of the best. We should seek to extend, in Scotland at least, if not in the whole of the United Kingdom, the kind of plan which my right hon. Friend the Member for Kilmarnock (Mr. Ross) worked so well with my right hon. Friend the Member for Grimsby (Mr. Crosland), when they managed a pilot scheme for better training of management, some years ago. It was a good scheme which was fully taken up, and many people profited by it.
  This is the kind of activity in which the Government should be indulging as well as introducing a public works programme dealing with water, sewerage and other things. Better management is as important as better labour relations and investment in infrastructure and work. It is an aspect that we tend to forget.

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  My sixth point concerns something which we in the last Government considered but never firmly decided upon. The right hon. Gentleman may have a tough time with his colleagues over it. It is the question of rehousing industry in Scotland. Most of Scottish industry operates in Victorian premises which are hopelessly out of date. This does not give Scottish industry a decent start against competitors. I think that the rehousing of Scottish industry by the State is something which must be taken on reasonably soon. We could do this if we were willing to use Scottish Industrial Estates and the corporations for the job instead of just concentrating on the housing of new industry.
  Someone said in the debate that one of the defects of the S.D.A. policy is the absurdity of the so-called 30-mile limit. I have four instances of it in my constituency and the surrounding area. People cannot move from one point to another because they are within the 30-mile radius, and yet they could create employment or better conditions for the workers which could lead to more employment. These administrative shackles should be cut away.
  The Under-Secretary of State for Development, Scottish Office (Mr. George Younger): I wish to correct something which the hon. Gentleman inadvertently said or an impression he gave unintentionally. No doubt there are some factory premises in Scotland which are out of date, but I am sure that the hon. Gentleman would not wish it to be thought that all of them were out of date. There are some very fine and modern factory facilities in Scotland, and I hope that the hon. Gentleman will confirm that.
  Dr. Mabon: The trouble with being critical and honest is that one is misrepresented, unintentionally. If half the premises in Scotland are Victorian, the other half must be good premises. The figure has been given to me in confidence by someone who should know. I am sorry that I am being so constructive, because obviously it does not appeal to hon. Members opposite.
  My seventh point is this : the Government should realise that Hunterston and its potentiality represents the greatest single chance which Scotland has of being a trading bridge between Europe and America. According to the Economist
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  last week, Krupps has made a survey of the potentiality of this site for a steel plant able to load on to large ore vessels steel which could account for as much as 80 per cent. of the plant's production. I would prefer the British Steel Corporation to do this job rather than Krupps. That is not unreasonable. But whoever does it there is no doubt that it would be a new focus of industry in Scotland. It would be a steel works able to supply our friends in Europe and America and to form the basis for the consumption of larger quantities of steel in Scotland. This is the greatest single development which the Government could authorise this year or in any year in the next five.
  Mr. Alexander Wilson: Apart from resigning.
  Dr. Mabon: There is a better chance of getting a steel mill than of getting this lot to resign.
  I take issue on the question of Clyde-port. It cannot develop without the steel works being a focus of activity. To go into the economics of building a large iron ore port such as Clydeport without a steel works is foolish. It is not my opinion which counts, but the opinion of those who would sponsor it. I do not visualise Clydeport asking for this money unless it is clear that the Government intend to build this large steel works in Scotland.
  In the absence of a national ports authority and nationalisation of the ports, let us face this fact : it is far better for the State directly to invest in Clydeport than to seek to saddle it with loans in trying to build up a great port at Hunterston. Let us have some ambitious thoughts about this section of Scotland which offers the same opportunity as was offered in Victorian times when Central Scotland became the cradle of the industrial revolution in our part of the United Kingdom.
  That is the kind of positive programme which the Government should be adopting. They are doing none of these things. They have failed in their objectives in the last 15 months. While we may know the song of distress, the extent of the Government's failure is eloquently put in the Conservative Party's manifesto on Scotland. The opening paragraph says :
  "Scotland will get moving again. No part of Britain has more to gain from Tory policies ".

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  If ever a Motion of censure were carried in a Tory manifesto, it is carried in this one.
  9.30 p.m.
  The Minister for Trade (Mr. Michael Noble): It is like old times to come back to the Box at the end of a Scottish debate, and I am grateful to the right hon. Member for Kilmarnock (Mr. Ross) and to the hon. Member for Greenock (Dr. Dickson Mabon) for welcoming me back again. The hon. Member for Greenock said that this was to some extent a self-confession that all is not well, and every hon. Member representing a Scottish constituency on either side of the House feels that it is hard because the situation today in Scotland is deplorable. I am sorry that certain hon. Members said that my right hon. Friend made no reference to the human suffering caused by unemployment at this level. But my right hon. Friend did. He said it was regrettable not only from the human aspect but because of the tremendous waste of resources that unemployment brought about.
  I was interested in a number of constructive points made by the hon. Member for Greenock which need much careful thought. I am delighted that he now supports, as we have for a long time, the training of people in new skills and in management. He will remember that not so long ago the main attack from the Scottish Council on his own Government's policies was that they were not considering this problem.
  Dr. Dickson Mabon: That is not true.
  Mr. Noble: I cannot remind the hon. Gentleman to look up HANSARD, but if he reads the Scottish Council reports of about three years ago he will find that was the main charge. The hon. Gentleman asked me to defend the policy of S.D.A.s. His Government invented S.D.A.s. and, because this was a convenient method of getting help quickly, we are following the course that his Government thought was wise.
  Unlike our experience in some earlier debates, we have heard a great many constructive and useful speeches, and my right hon. Friend will be thinking seriously about a number of points. He has a considerable problem, which we all
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  realise, of trying to get the situation in Scotland back again on to a good footing It was lamentable that the hon. Member for Hamilton (Mr. Alexander Wilson) should revert to the worst tradition of the old Scottish debates. It was rather remarkable that this speech should have come from Hamilton where, if he has a reasonably long memory, the hon. Gentleman will remember his right hon. Friend was totally rejected in a by-election not very long ago.
  Mr. Alexander Wilson Mr. Alexander Wilson rose—
  Mr. Noble: There are very serious problems, and we all know them, but his speech did not contain a single constructive idea from beginning to end. This is what is often wrong about speeches which are made in these debates—and I have attended many of them—
  Dr. Miller: It was a good speech.
  Mr. Noble: Every one is entitled to his opinion. It is a free House—[Laughter.]—and we are all entitled to express our opinions and stand by them, but we are equally entitled to deplore rubbish when it is spoken from either side.
  The most depressing aspect of the speech of the right hon. Member for Kilmarnock is that he did not for one single second—
  Mr. Alexander Wilson Mr. Alexander Wilson rose—
  Mr. Noble: I am sorry—
  Mr. William Hamilton Mr. William Hamilton rose—
  Mr. Speaker: Order.
  Dr. Miller: It is a free House—give him a drink.
  Mr. Speaker: It is a free House, but it is tied to certain rules of order. The right hon. Gentleman has not given way.
  Mr. Norman Buchan: If an hon. Member is attacked, is he not entitled to reply?
  Mr. Noble: The hon. Gentleman well knows that in our debates one is perfectly entitled to say what one thinks about a speech. It has been said often enough about me and people would never give way. The right hon. Member for Kilmarnock never gave way once in four years.
  Mr. Ross: That is not true.
  Mr. Noble: Unfortunately it is true, and I would ask the right hon. Gentleman to look at HANSARD.
  The depressing aspect of the right hon. Gentleman's speech was that he did not for one moment contemplate that anything he had done in the six years that he was Secretary of State could possibly have contributed to the problems which we inherited. The situation today is extremely grave, and I do not hesitate to say so, but it is a fact that in 1966, when the right hon. Gentleman's plans could reasonably have been expected to come to fruition and when the right hon. Gentleman was in his own way leading forward the position of Scotland, unemployment was 55,000.
  Mr. Douglas: It is now 120,000.
  Mr. Noble: In July 1970, the unemployment figure was 93,400. We all know that this was not only the situation in Scotland but that it affected the United Kingdom as a whole. When we came into office in the summer of last year there were some particularly worrying features in Scotland, and everybody who had to study the figures could see them.
  First, we could see that Scotland was securing a lower proportion of the new industrial projects than it had in the past. During the period from mid-1966 to mid-1970, total employment in Scotland had declined by some 65,000 jobs. These figures exclude the construction industry because the employment figure for that industry, after S.E.T., became a little more difficult to analyse because so many people became self-employed.
  The figure was bad enough, but the total includes a loss of 20,000 jobs in the manufacturing industry at a time when employment in the manufacturing sectors of Wales and in the northern region increased by over 40,000 jobs. Therefore, I find it a little difficult to see from what basis of success in his own period of office the former Secretary of State seeks to say that it is all our fault and that he was doing a splendid job. He was losing manufacturing jobs in Scotland at the same time as his colleagues in Wales and the northern region were gaining them fast. This was
  342
  a very difficult and worrying problem to put right.
  Secondly, there was the problem of the particularly heavy incidence of unemployment in West Central Scotland. For a considerable time now half of Scotland's unemployment has been on Clydeside and in the surrounding areas of West Central Scotland. The right hon. Lady, the Member for Lanark (Mrs. Hart) and the right hon. Member for Kilmarnock indignantly demanded that the Government had done nothing about rising unemployment in Scotland. I wonder why the Labour Party did not stop the rising tide when they were in office. The signs were clearly there and the picture was one of steadily increasing unemployment.
  I would not mind if only they said, "This was a problem which we were trying to tackle and which we found exceedingly difficult. We tried these methods, some worked and some did not". But not at all. They try to pretend that in some curious way the whole problem has developed suddenly since June of last year. I find that quite nauseating. Certainly the position has worsened. However, something which rapidly is going downhill takes even longer to put right than the sort of situation that the right hon. Gentleman inherited, which was on a steeply upward graph. It is because the policies of the previous Administration had failed totally to deal with the situation that it was right for this Government to see whether new policies should not be introduced which would have a good deal better effect.
  My right hon. Friend made clear today the reasons why the new policies were adopted, what they were, and how he expected them to develop once we had the economy as a whole going as well.
  I agree with the hon. Member for Greenock that it does not matter how good the incentives are or how big the S.D.A.s are, unless the economy can be got on the move upwards, there is no chance of attracting industry to Scotland and little chance of getting the industry which is in Scotland working at anywhere near its full potential.
  To my mind, there are two separate but very important points. We have to get the economy of Britain moving. Once

  343
  that happens, we have to have the right parcel of incentives in order to attract our share or more than our share—
  Mr. Douglas: I am intrigued by the right hon. Gentleman's analysis. Will he concede that what we really need is a third Budget? Following it, we might get some other incentives to see whether the third Budget is in harmony with the new incentives, because clearly the present incentives are in harmony neither with the Government's budgetary policy nor with the anticipated growth in the United Kingdom economy.
  Mr. Noble: When I sat on that side of the House, we were becoming perfectly used to three or four Budgets a year. However, I agree that to deal with special problems from time to time special Measures have to be taken and not confined just to a single time in the year, in order to put the required remedies into operation.
  The difficulty in which the right hon. Gentleman and many of his hon. Friends find themselves is that it is not sufficient simply to say that we want investment in Scotland irrespective of what it may be. In the past four or five years, we have seen a very great deal of money going into Scotland through investment grants, but the number of jobs has dropped steadily.
  Mr. Ross Mr. Ross rose—
  Mr. Noble: I should love to allow the right hon. Gentleman to intervene. However, as he would never give way to me, I think that it would be terribly good for his soul, for once, if an hon. Member refused to give way to him.
  Mr. Ross Mr. Ross rose—
  Mr. Noble: No, I shall not give way.
  Mr. Ross: It is quite untrue to say that I never gave way—
  Mr. Noble: I think that he did on one occasion. The right hon. Gentleman knows that generally I am extremely courteous. However, as he refused to give way to me in debate after debate, just once in his life it would be very good for him if an hon. Member did not give way to him.
  344
  I now turn to the various points which were made in the debate to see whether I can either encourage or discourage some of the suggestions which were put forward.
  Dr. Dickson Mabon Dr. Dickson Mabon rose—
  Mr. Noble: I think I heard something which passed between the hon. Gentleman and his right hon. Friend. There was a little collusion going on.
  Dr. Mabon: Will the right hon. Gentleman give way?
  Mr. Noble: I will give way to the hon. Gentleman, but not at this moment because I know that he is doing a little fiddle with his right hon. Friend.
  The right hon. Member for Kilmarnock asked why the office dealing with V.A.T. was to be in Southend. The answer, which I suspect he already knows, is perfectly simple. The Customs and Excise duties office in Southend will be used in the beginning stages for dealing with V.A.T. About three-quarters of the jobs which will be created—I think that is the right word—for V.A.T. will be scattered throughout the rest of the country. It is not, as it were, a post office which is being set up in Southend. The staff there will be used, but the great bulk of the extra jobs will be scattered throughout the rest of the country.
  My right hon. Friend was asked and spoke about I.D.C.s, and the hon. Member for Greenock also mentioned them. My right hon. Friend very properly said that the signs of improvement were slight, but that it is always dangerous to try to base firm calculations on a short period. However, I can give some figures to the House. In the period January—June, 1970, 79 I.D.C.s were issued ; in the same period in 1971 there were 88. The area covered was 3·8 million sq. ft. in 1970 and 4·2 million sq. ft. in 1971. For West Central Scotland, under the S.D.A. policy, one can take only the March—June figures. In March—June, 1970, the number of I.D.C.s issued for that part of Scotland was 17 and in March—June, 1971, the number was 27. I do not ask hon. Members to cheer desperately about that, because I know that they will not. However, as I was asked for the figures, I have given them.
  The right hon. Member for Lanark asked what would be the position of

  345
  I.D.C.s if we went into the European Economic Community.
  Mrs. Hart: No, I did not.
  Mr. Noble: I shall check HANSARD tomorrow, but I wrote it down as the right hon. Lady said it.
  Mrs. Hart: I should like to give the right hon. Gentleman a little longer to deal with the fundamentals of the situation. I did not ask what the I.D.C. position would be. I said that I found it impossible to believe that one could operate a successful I.D.C. policy with the free flow of capital under the Treaty of Rome.
  Mr. Noble: The right hon. Lady can certainly find out what the position is by asking her right hon. Friend the Member for Dundee, East (Mr. George Thomson), but I.D.C. policy is being operated by the French in Paris, and there is no information, either from the capital point of view or I.D.Cs., that we need to change our particular policy.
  Mr. Buchan Mr. Buchan rose—
  Mr. Noble: I am sorry, but there are many points still to be covered. I understood what was said, and I have given the right hon. Lady the answer.
  The right hon. Lady—and I took this one down, too—talked about her Government when she was a member of the Cabinet and said, "We had not reduced the unemployment figures as much as we would have liked". That is a fairly good description of doubling the unemployment figure in four years. The right hon. Lady went on to say, with great pride, that her Government had solved the balance of payments problems and so could not at the same time have any growth. She did not mention that they had very largely increased the short-term indebtedness of Britain, which somebody else had to repay.
  Mr. James Hamilton Mr. James Hamilton rose—
  Mr. Noble: I am sorry, but I have only 10 minutes in which to wind up a long debate.
  I thought that my hon. Friend the Member for Edinburgh, South (Mr. Clark Hutchison) spoke very sensibly about the problems of Scotland from the point of view of a Scotsman who knows that we
  346
  have considerable skills, considerable inventive genius, and considerable ability to work, and who finds it depressing and difficult to understand why we are continually in this sort of position. I have great sympathy with what he said. I believe that this is not endemic in Scotland, but there are moments—and this debate almost annually is one of them—when we do our best to tear ourselves to pieces for the benefit of nobody.
  I know my hon. Friend's passionate desire to keep out of the Common Market. He proudly said that his factory in West Dunbartonshire could beat the Common Market, whatever it does, but just to encourage his shareholders may I tell him that, if we succeed in getting into the Common Market as the tariff on clocks from this country is about 10 per cent. he will be able greatly to increase the employment in his area, and make a great many more clocks.
  My hon. Friend the Member for Aberdeenshire, East (Mr. Wolrige-Gordon) asked two questions. First, whether, if the oil which we all hope will be found off his coast is to come into Peterhead, the Government will be able to help in any reasonable way to establish the necessary facilities in his area. I am certain that all the help that is provided for D.A.s will be available for this purpose, and I think we all hope that this area will benefit from the rather fortunate discovery of oil.
  As regards the small shipyards, I think that a meeting, which I believe has been discussed with the Scottish Office, might be of use, and I hope that my hon. Friend will be able to attend such a meeting to consider what is the right solution to the problem.
  I should like to be able to answer the questions asked by the hon. Member for Inverness (Mr. Russell Johnston) about exactly what will happen with regard to the grant of franchises and royalties. I think that we should wait until we see what we get before we decide how we are going to spend it. That may not be a very liberal approach, but it is a practical one, and I think that there may be more than his party and mine trying to see that we get the maximum amount for Scotland.
  My hon. Friend the Member for Perth and West Perthshire (Mr. MacArthur) spoke about the American investment

  347
  that had come to Scotland in the past. I should merely like to add to what he said that this investment did not come in only to get into the Commonwealth area. It came in, particularly in the early 'sixties, not only to get the benefits of proximity to Europe, but to the E.F.T.A. market as well.
  I have great hopes that if we succeed in our Common Market endeavours there will be great potential for new industry in Scotland, not only from America but also from Europe. My hon. Friend the Member for Fife, East (Sir J. Gilmour) seemed to strike a cheerful note by asking for the reduction of the whisky duty and the abolition of petrol duty on the Islands. I shall have the greatest possible pleasure in submitting both suggestions to the Chancellor of the Exchequer on his behalf.
  My hon. Friend the Member for Ross and Cromarty (Mr. Gray) and the hon. Member for the Western Isles (Mr. Donald Stewart) both asked about regional policies if we go into Europe. As I have said about the I.D.C. policy, there is at the moment no visible sign that anything we are doing by way of regional policy would not be allowed in Europe. I cannot say that I agree with the hon. Member for the Western Isles in his views about either the rocket bases, the Polaris bases or the gunnery range. We may approach these things from different ends. I do find it a little distressing that someone should complain bitterly about unemployment in his area and yet feel so strongly about rockets that he should want to turn away jobs. He should consult his constituents before making that sort of statement on their behalf, although I appreciate that he may have strong personal feelings about it.
  My hon. Friend the Member for Galloway (Mr. Brewis) asked whether, if the gunnery range came to his area, there would be a public inquiry. My right hon. Friend says that it is early days to decide whether this is the way he would deal with that matter. My hon. Friend the Member for Banff (Mr. W. H. H. Baker) raised a number of points on the Common Market. I cannot answer these today, but I have no doubt that he will take part in the very long debate on the subject later on.
  In conclusion—[HON. MEMBERS : "Hear, hear."] I think it is fair to say that we have had a serious debate. It has finished up in the usual Scottish way with Minister being shouted at on all sides. I have seen it all too often.
  I finish on one serious note. This is a problem which affects every one of us who lives or works in Scotland. We all have a considerable part to play in creating the right atmosphere for business to come to Scotland and for people to work in the factories under reasonable conditions. This is not something just for the trade unions, neither is it for industrialists alone. It is something in which all of us in the House can help. If we do that the future of Scotland will be a great deal better than if we spend the time barking at each other about who did what when—
  Mr. Walter Harrison Mr. Walter Harrison (Wakefield) rose in his place and claimed to move. That the Question be now put.
  Question, That the Question be now put, put and agreed to.
  Question put accordingly, That the the Amendment be made :—
  The House divided : Ayes 305, Noes 272.

  Division No. 423.]

  AYES

  [10.0 p.m.

  Adley, Robert

  Bennett, Sir Frederic (Torquay)

  Brewis, John

  Alison, Michael (Barkston Ash)

  Bennett, Dr. Reginald (Gosport)

  Brinton, Sir Tatton

  Allason, James (Hemel Hempstead)

  Benyon, W.

  Brocklebank-Fowler, Christopher

  Amery, Rt. Hn. Julian

  Berry, Hn. Anthony

  Brown, Sir Edward (Bath)

  Archer, Jeffrey (Louth)

  Biffen, John

  Bruce-Gardyne, J.

  Astor, John

  Biggs-Davison, John

  Bryan, Paul

  Atkins, Humphrey

  Blaker, Peter

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

  Awdry, Daniel

  Boardman, Tom (Leicester, S.W.)

  Buck, Antony

  Baker, Kenneth (St. Marylebone)

  Body, Richard

  Bullus, Sir Eric

  Baker, W. H. K. (Banff)

  Boscawen, Robert

  Burden, F. A.

  Balniel, Lord

  Bossom, Sir Clive

  Butler, Adam (Bosworth)

  Barber, Rt. Hn. Anthony

  Bowden, Andrew

  Campbell, Rt. Hn. G.(Moray&Nairn)

  Batsford, Brian

  Boyd-Carpenter, Rt. Hn. John

  Carlisle, Mark

  Beamish, Col. Sir Tufton

  Braine, Bernard

  Carr, Rt. Hn. Robert

  Bell, Ronald

  Bray, Ronald

  Channon, Paul

  Chapman, Sydney

  Hiley, Joseph

  Owen, Idris (Stockport, N.)

  Chataway, Rt. Hn. Christopher

  Hill, James (Southampton, Test)

  Page, Graham (Crosby)

  Churchill, W. S.

  Holland, Philip

  Page, John (Harrow, W.)

  Clark, William (Surrey, E.)

  Holt, Miss Mary

  Parkinson, Cecil (Enfield, W.)

  Clarke, Kenneth (Rushcliffe)

  Hordern, Peter

  Peel, John

  Clegg, Walter

  Hornby, Richard

  Percival, Ian

  Cockeram, Eric

  Hornsby-Smith, Rt. Hn. Dame Patricia

  Peyton, Rt. Hn. John

  Cooke, Robert

  Howe, Hn. Sir Geoffrey (Reigate)

  Pike, Miss Mervyn

  Coombs, Derek

  Howell, David (Guildford)

  Pink, R. Bonner

  Cooper, A. E.

  Howell, Ralph (Norfolk, N.)

  Pounder, Rafton

  Cordle, John

  Hunt, John

  Powell, Rt. Hn. J. Enoch

  Corfield, Rt. Hn. Frederick

  Hutchison, Michael Clark

  Price, David (Eastleigh)

  Cormack, Patrick

  Iremonger, T. L.

  Proudfoot, Wilfred

  Costain, A. P.

  Irvine, Bryant Godman (Rye)

  Pym, Rt. Hn. Francis

  Critchley, Julian

  James, David

  Quennell, Miss J. M.

  Crouch, David

  Jenkin, Patrick (Woodford)

  Rawlinson, Rt. Hn. Sir Peter

  Crowder, F. P.

  Jennings, J. C. (Burton)

  Redmond, Robert

  Curran, Charles

  Jessel, Toby

  Reed, Laurance (Bolton, E.)

  Davies, Rt. Hn. John (Knutsford)

  Johnson Smith. G. (E. Grinstead)

  Rees, Peter (Dover)

  d'Avigdor-Goldsmid, Sir Henry

  Jones, Arthur (Northants, S.)

  Rees-Davies, W. R.

  d'Avigdor-Goldsmid. Maj.-Gen. James

  Jopling, Michael

  Renton, Rt. Hn. Sir David

  Dean, Paul

  Joseph, Rt. Hn. Sir Keith

  Rhys Williams, Sir Brandon

  Deedes, Rt. Hn. W. F.

  Kershaw, Anthony

  Ridley, Hn. Nicholas

  Digby, Simon Wingfield

  Kilfedder, James

  Ridsdale, Julian

  Dixon, Piers

  Kimball, Marcus

  Rippon, Rt. Hn. Geoffrey

  Dodds-Parker, Douglas

  King, Evelyn (Dorset, S.)

  Roberts, Michael (Cardiff, N.)

  Douglas-Home, Rt, Hn. Sir Alec

  King, Tom (Bridgwater)

  Rodgers, Sir John (Sevenoaks)

  Drayson, G. B.

  Kinsey, J. R.

  Rossi, Hugh (Hornsey)

  Rost, Peter

  du Cann, Rt. Hn. Edward

  Kitson, Timothy

  Russell, Sir Ronald

  Dykes, Hugh

  Knox, David

  St. John-Stevas, Norman

  Eden, Sir John

  Lambton, Antony

  Sandys, Rt. Hn. D.

  Edwards, Nicholas (Pembroke)

  Lane, David

  Scott, Nicholas

  Elliot, Capt. Walter (Carshalton)

  Langford-Holt, Sir John

  Scott-Hopkins, James

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

  Legge-Bourke, Sir Harry

  Sharples, Richard

  Emery, Peter

  Le Marchant, Spencer

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

  Farr, John

  Lewis, Kenneth (Rutland)

  Shelton, William (Clapham)

  Fell, Anthony

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

  Simeons, Charles

  Fenner, Mrs. Peggy

  Longden, Gilbert

  Sinclair, Sir George

  Fidler, Michael

  Loveridge, John

  Skeet, T. H. H.

  Finsberg, Geoffrey (Hampstead)

  Luce, R. N.

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

  Fisher, Nigel (Surbiton)

  McAdden, Sir Stephen

  Soref, Harold

  Fookes, Miss Janet

  MacArthur, Ian

  Speed, Keith

  Fortescue, Tim

  McCrindle, R. A.

  Spence, John

  Foster, Sir John

  McLaren, Martin

  Sproat, Iain

  Fowler, Norman

  Maclean, Sir Fitzroy

  Stainton, Keith

  Fox, Marcus

  McMaster, Stanley

  Stanbrook, Ivor

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

  Macmillan, Maurice (Farnham)

  Stewart-Smith. D. G. (Belper)

  Fry, Peter

  McNair-Wilson, Michael

  Stodart, Anthony (Edinburgh, W.)

  Galbraith, Hn. T. G.

  McNair-Wilson, Patrick (NewForest)

  Stoddart-Scott, Col. Sir M.

  Gardner, Edward

  Maddan, Martin

  Stokes, John

  Gibson-Watt, David

  Madel, David

  Stuttaford, Dr. Tom

  Gilmour, Ian (Norfolk, C.)

  Marten, Neil

  Sutcliffe, John

  Gilmour, Sir John (Fife, E.)

  Mather, Carol

  Tapsell, Peter

  Glyn, Dr. Alan

  Maude, Angus

  Taylor, Sir Charles (Eastbourne)

  Godber, Rt. Hn. J. B.

  Maudling, Rt. Hn. Reginald

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

  Goodhart, Philip

  Mawby, Ray

  Taylor, Frank (Moss Side)

  Goodhew, Victor

  Maxwell-Hyslop, R. J.

  Taylor, Robert (Croydon, N. W.)

  Gorst, John

  Meyer, Sir Anthony

  Tebbit, Norman

  Gower, Raymond

  Mills, Peter (Torrington)

  Temple, John M.

  Grant, Anthony (Harrow, C.)

  Mills, Stratton (Belfast, N.)

  Thatcher, Rt. Hn. Mrs. Margaret

  Gray, Hamish

  Miscampbell, Norman

  Thomas, John Stradling (Monmouth)

  Green, Alan

  Mitchell, Lt.-Col. C.(Aberdeenshire, W.)

  Thomas, Rt. Hn. Peter (Hendon, S.)

  Grieve, Percy

  Mitchell, David (Basingstoke)

  Thompson, Sir Richard (Croydon, S.)

  Griffiths, Eldon (Bury St. Edmunds)

  Moate, Roger

  Tilney, John

  Grylls, Michael

  Molyneaux, James

  Gummer, Selwyn

  Money, Ernle

  Trafford, Dr. Anthony

  Gurden, Harold

  Monks, Mrs. Connie

  Trew, Peter

  Hall, Miss Joan (Keighley)

  Monro, Hector

  Tugendhat, Christopher

  Hall, John (Wycombe)

  Montgomery, Fergus

  Turton, Rt Hn. Sir Robin

  Hall-Davis, A. G. F.

  Morgan, Geraint (Denbigh)

  van Straubenzee, W. R.

  Hamilton, Michael (Salisbury)

  Morgan-Giles, Rear-Adm.

  Vaughan, Dr. Gerard

  Hannam, John (Exeter)

  Morrison, Charles (Devizes)

  Vickers, Dame Joan

  Mudd, David

  Waddington, David

  Harrison, Brian (Maldon)

  Murton, Oscar

  Walder, David (Clitheroe)

  Harrison, Col. Sir Harwood (Eye)

  Nabarro, Sir Gerald

  Walker, Rt. Hn. Peter (Worcester)

  Haselhurst, Alan

  Neave, Airey

  Walker-Smith, Rt. Hn. Sir Derek

  Hastings, Stephen

  Nicholls, Sir Harmar

  Wall, Patrick

  Havers, Michael

  Noble, Rt. Hn. Michael

  Walters, Dennis

  Hawkins, Paul

  Normanton, Tom

  Ward, Dame Irene

  Hay, John

  Nott, John

  Warren, Kenneth

  Hayhoe, Barney

  Onslow, Cranley

  Weatherill, Bernard

  Heseltine, Michael

  Oppenheim, Mrs. Sally

  Wells, John (Maidstone)

  Hicks, Robert

  Orr, Capt. L. P. S.

  White, Roger (Gravesend)

  Higgins, Terence L.

  Osborn, John

  Whitelaw, Rt. Hn. William

  350

  351

  Wiggin, Jerry

  Woodnutt, Mark

  Wilkinson, John

  Worsley, Marcus

  TELLERS FOR THE AYES :

  Wolrige-Gordon, Patrick

  Wylie, Rt. Hn. N. R.

  Mr. Reginald Eyre and

  Wood, Rt. Hn. Richard

  Younger, Hn. George

  Mr. Jasper More.

  Woodhouse, Hn. Christopher

  NOES

  Abse, Leo

  Fitch, Alan (Wigan)

  Lyon, Alexander W. (York)

  Albu, Austen

  Fitt, Gerard (Belfast, W.)

  Lyons, Edward (Bradford, E.)

  Allaun, Frank (Salford, E.)

  Fletcher, Ted (Darlington)

  Mabon, Dr. J. Dickson

  Allen, Scholefield

  Foley, Maurice

  McBride, Neil

  Archer, Peter (Rowley Regis)

  Foot, Michael

  McCann, John

  Armstrong, Ernest

  Ford, Ben

  McCartney, Hugh

  Ashley, Jack

  Forrester, John

  McElhone, Frank

  Ashton, Joe

  Fraser, John (Norwood)

  McGuire, Michael

  Atkinson, Norman

  Freeson, Reginald

  Mackenzie, Gregor

  Bagier, Gordon A. T.

  Galpern, Sir Myer

  Mackie, John

  Barnett, Guy (Greenwich)

  Garrett, W. E.

  Maclennan, Robert

  Barnett, Joel

  Gilbert, Dr. John

  McMillan, Tom (Glasgow, C.)

  Benn, Rt. Hn. Anthony Wedgwood

  Ginsburg, David

  McNamara, J. Kevin

  Bennett, James (Glasgow, Bridgeton)

  Golding, John

  Mahon, Simon (Bootle)

  Bidwell, Sydney

  Gordon Walker, Rt& Hn. P. C.

  Mallalieu, E. L. (Brigg)

  Bishop, E. S.

  Gourlay, Harry

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

  Blenkinsop, Arthur

  Grant, George (Morpeth)

  Marks, Kenneth

  Boardman, H. (Leigh)

  Grant, John D. (Islington, E.)

  Marquand, David

  Booth, Albert

  Griffiths, Eddie (Brightside)

  Marsden, F.

  Bottomley, Rt. Hn. Arthur

  Griffiths, Will (Exchange)

  Marshall, Dr. Edward

  Boyden, James (Bishop Auckland)

  Grimond, Rt. Hn. J.

  Mason, Rt. Hn. Roy

  Bradley, Tom

  Gunter, Rt. Hn. R. J.

  Mayhew, Christopher

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

  Hamilton, James (Bothwell)

  Mellish, Rt. Hn. Robert

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

  Hamilton, William (Fife, W.)

  Mendelson, John

  Brown, Ronald (Shoreditch & F'bury)

  Hamling, William

  Mikardo, Ian

  Buchan, Norman

  Hannan, William (G'gow, Maryhill)

  Millan, Bruce

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

  Hardy, Peter

  Miller, Dr. M. S.

  Butler, Mrs. Joyce (Wood Green)

  Harrison, Walter (Wakefield)

  Milne, Edward (Blyth)

  Callaghan, Rt. Hn. James

  Hart, Rt. Hn. Judith

  Mitchell, R. C. (S'hampton, Itchen)

  Campbell, I. (Dunbartonshire, W.)

  Hattersley, Roy

  Molloy, William

  Cant, R. B.

  Healey, Rt. Hn. Denis

  Morgan, Elystan (Cardiganshire)

  Carmichael, Neil

  Heffer, Eric S.

  Morris, Alfred (Wythenshawe)

  Carter, Ray (Birmingh'm, Northfield)

  Hilton, W. S.

  Morris, Charles R. (Openshaw)

  Carter-Jones, Lewis (Eccles)

  Hooson, Emlyn

  Morris, Rt. Hn. John (Aberavon)

  Castle, Rt. Hn, Barbara

  Horam, John

  Moyle, Roland

  Clark, David (Colne Valley)

  Houghton. Rt. Hn. Douglas

  Murray, Ronald King

  Cocks, Michael (Bristol, S.)

  Howell, Denis (Small Heath)

  Ogden, Eric

  Cohen, Stanley

  Huckfield, Leslie

  O'Halloran, Michael

  Concannon, J. D.

  Hughes, Rt. Hn. Cledwyn (Anglesey)

  O'Malley, Brian

  Conlan, Bernard

  Hughes, Mark (Durham)

  Oram, Bert

  Corbet, Mrs. Freda

  Hughes, Robert (Aberdeen, N.)

  Orme, Stanley

  Cox, Thomas (Wandsworth, C.)

  Hunter, Adam

  Oswald, Thomas

  Crawshaw, Richard

  Irvine, Rt. Hn. SirArthur (Edge Hill)

  Owen, Dr. David (Plymouth, Sutton)

  Cronin, John

  Janner, Greville

  Padley, Walter

  Crosland, Rt. Hn. Anthony

  Jay, Rt. Hn. Douglas

  Paget, R. T.

  Crossman, Rt. Hn. Richard

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

  Palmer, Arthur

  Cunningham, G. (Islington, S. W.)

  Jenkins, Hugh (Putney)

  Pannell, Rt. Hn. Charles

  Dalyell, Tam

  Jenkins, Rt. Hn. Roy (Stechford)

  Pardoe, John

  Darling, Rt. Hn. George

  John, Brynmor

  Parker, John (Dagenham)

  Davidson, Arthur

  Johnson, Carol (Lewisham, S.)

  Parry, Robert (Liverpool, Exchange)

  Davies, Denzil (Llanelly)

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

  Peart, Rt. Hn. Fred

  Pendry, Tom

  Davies, G. Elfed (Rhondda, E.)

  Johnson, Walter (Derby, S.)

  Pentland, Norman

  Davies, Ifor (Gower)

  Johnston, Russell (Inverness)

  Perry, Ernest G.

  Davies, S. O. (Merthyr Tydvil)

  Jones, Barry (Flint, E.)

  Prentice, Rt. Hn. Reg.

  Davis, Clinton (Hackney, C.)

  Jones, Dan (Burnley)

  Prescott, John

  Davis, Terry (Bromsgrove)

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

  Price, J. T. (Westhoughton)

  Dcakins, Eric

  Jones, Gwynoro (Carmarthen)

  Price, William (Rugby)

  de Freitas, Rt. Hn. Sir Geoffrey

  Jones, T. Alec (Rhondda, W.)

  Probert, Arthur

  Delargy, H. J.

  Judd, Frank

  Rankin, John

  Dell, Rt. Hn. Edmund

  Kaufman, Gerald

  Reed, D. (Sedgefield)

  Dempsey, James

  Kelley, Richard

  Rees, Merlyn (Leeds, S.)

  Doig, Peter

  Kerr, Russell

  Rhodes, Geoffrey

  Dormand, J. D.

  Kinnock, Neil

  Richard, Ivor

  Douglas, Dick (Stirlingshire, E.)

  Lambie, David

  Roberts, Alhert (Normanton)

  Douglas-Mann, Bruce

  Lamond, James

  Roberts, Rt. Hn. Goronwy (Caernarvon)

  Duffy, A. E. P.

  Latham, Arthur

  Robertson, John (Paisley)

  Dunn, James A.

  Lawson, George

  Roderick, CaerwynE. (Br'c'n&R'dnor)

  Dunnett, Jack

  Leadbitter, Ted

  Rodgers, William (Stockton-on-Tees)

  Eadie, Alex

  Lee, Rt. Hn. Frederick

  Roper, John

  Edelman, Maurice

  Leonard, Dick

  Ross, Rt. Hn. William (Kilmarnock)

  Ellis, Tom

  Lever, Rt. Hn. Harold

  Sandelson, Neville

  English, Michael

  Lewis, Arthur (W. Ham N.)

  Sheldon, Robert (Ashton-under-Lyne)

  Evans, Fred

  Lewis, Ron (Carlisle)

  Shore, Rt. Hn. Peter (Stepney)

  Faulds, Andrew

  Lipton, Marcus

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

  Fernyhough, Rt. Hn. E.

  Lomas, Kenneth

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

  Fisher, Mrs. Doris (B'ham, Ladywood)

  Loughlin, Charles

  Silkin, Rt. Hn. John (Deptford)

  352

  353

  Silkin, Hn. S. C. (Dulwich)

  Taverne, Dick

  Wellbeloved, James

  Sillars, James

  Thomas, Rt. Hn. George (Cardiff, W.)

  Wells, William (Walsall, N.)

  Silverman, Julius

  Thomas, Jeffrey (Abertillery)

  White, James (Glasgow, Pollok)

  Skinner, Dermis

  Thomson, Rt. Hn. G. (Dundee, E.)

  Whitehead, Phillip

  Small, William

  Thorpe, Rt. Hn. Jeremy

  Whitlock, William

  Smith, John (Lancashire, N.)

  Tinn, James

  Willey, Rt. Hn. Frederick

  Spearing, Nigel

  Tomney, Frank

  Williams, Mrs. Shirley (Hitchin)

  Spriggs, Leslie

  Torney, Tom

  Wilson, Alexander (Hamilton)

  Stallard, A. W.

  Tuck, Raphael

  Wilson, Rt. Hn. Harold (Huyton)

  Steel, David

  Urwin, T. W.

  Wilson, William (Coventry, S.)

  Stewart, Donald (Western Isles)

  Varley, Eric G.

  Woof, Robert

  Stoddart, David (Swindon)

  Wainwright, Edwin

  Stonehouse, Rt. Hn. John

  Walden, Brian (B'm'ham, All Saints)

  TELLERS FOR THE NOES :

  Strang, Cavin

  Wallace, George

  Mr. Donald Coleman and

  Strauss, Rt. Hn. G. R.

  Watkins, David

  Mr. Joseph Harper.

  Summerskill, Hn. Dr. Shirley

  Weitzman, David

  Main Question, as amended, put :—
  The house divided: Ayes 305, Noes 272.

  Division No. 424.]

  AYES

  [10.13 p.m.

  Adley, Robert

  Critchley, Julian

  Harrison, Col. Sir Harwood (Eye)

  Alison, Michael (Barkston Ash)

  Crouch, David

  Haselhurst, Alan

  Allason, James (Hemel Hempstead)

  Crowder, F. P.

  Hastings, Stephen

  Amery, Rt. Hn. Julian

  Curran, Charles

  Havers, Michael

  Archer, Jeffrey (Louth)

  Davies, Rt. Hn. John (Knutsford)

  Hawkins, Paul

  Astor, John

  d'Avigdor-Goldsmid, Sir Henry

  Hay, John

  Atkins, Humphrey

  d'Avigdor-Goldsmid, Maj.-Gen. James

  Hayhoe, Barney

  Awdry, Daniel

  Dean, Paul

  Heseltine, Michael

  Baker, Kenneth (St. Marylebone)

  Deedes, Rt. Hn. W. F.

  Hicks, Robert

  Baker, w. H. K. (Banff)

  Digby, Simon Wingfield

  Higgins, Terence L.

  Balniel, Lord

  Dixon, Piers

  Hiley, Joseph

  Barber, Rt. Hn. Anthony

  Dodds-Parker, Douglas

  Hill, James (Southampton, Test)

  Batsford, Brian

  Douglas-Home, Rt. Hn. Sir Alec

  Holland, Philip

  Beamish, Col. Sir Tufton

  Drayson, G. B.

  Holt, Miss Mary

  Bell, Ronald

  du Cann, Rt. Hn. Edward

  Hordern, Peter

  Bennett, Sir Frederic (Torquay)

  Dykes, Hugh

  Hornby, Richard

  Bennett, Dr. Reginald (Gosport)

  Eden, Sir John

  Hornsby-Smith, Rt. Hn. Dame Patricia

  Benyon, W.

  Edwards, Nicholas (Pembroke)

  Howe, Hn. Sir Geoffrey (Reigate)

  Berry, Hn. Anthony

  Elliot, Capt. Walter (Carshalton)

  Howell, David (Guildford)

  Biffen, John

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

  Howell, Ralph (Norfolk, N.)

  Biggs-Davison, John

  Emery, Peter

  Hunt, John

  Blaker, Peter

  Farr, John

  Hutchison, Michael Clark

  Boardman, Tom (Leicester, S. W.)

  Fell, Anthony

  Iremonger, T. L.

  Body, Richard

  Fenner, Mrs. Peggy

  Irvine, Bryant Godman (Rye)

  Boscawen, Robert

  Fidler, Michael

  James, David

  Bossom, Sir Clive

  Finsberg, Geoffrey (Hampstead)

  Jenkin, Patrick (Woodford)

  Bowden, Andrew

  Fisher, Nigel (Surbiton)

  Jennings, J. C. (Burton)

  Boyd-Carpenter, Rt. Hn. John

  Fookes, Miss Janet

  Jessel, Toby

  Braine, Bernard

  Fortescue, Tim

  Johnson Smith, G. (E. Grinstead)

  Bray, Ronald

  Foster, Sir John

  Jones, Arthur (Northants, S.)

  Brewis, John

  Fowler, Norman

  Jopling, Michael

  Brinton, Sir Tatton

  Fox, Marcus

  Joseph, Rt. Hn. Sir Keith

  Brocklebank-Fowler, Christopher

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

  Kershaw, Anthony

  Brown, Sir Edward (Bath)

  Fry, Peter

  Kilfedder, James

  Bruce-Gardyne, J.

  Galbraith, Hn. T. G.

  Kimball, Marcus

  Bryan, Paul

  Gardner, Edward

  King, Evelyn (Dorset, S.)

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

  Gibson-Watt. David

  King, Tom (Bridgwater)

  Buck, Antony

  Gilmour, Ian (Norfolk, C.)

  Kinsey, J. R.

  Bullus, Sir Eric

  Gilmour, Sir John (Fife, E.)

  Kitson, Timothy

  Burden, F. A.

  Glyn, Dr. Alan

  Knox, David

  Lambton, Antony

  Butler, Adam (Bosworth)

  Godber, Rt. Hn. J. B.

  Lane, David

  Campbell, Rt. Hn. G. (Moray&Nairn)

  Goodhart, Philip

  Langford-Holt, Sir John

  Carlisle, Mark

  Goodhew, Victor

  Legge-Bourke, Sir Harry

  Carr, Rt. Hn. Robert

  Gorst, John

  Le Marchant, Spencer

  Channon, Paul

  Gower, Raymond

  Lewis, Kenneth (Rutland)

  Chapman, Sydney

  Grant, Anthony (Harrow, C.)

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

  Chataway, Rt. Hon. Christopher

  Cray, Hamish

  Longden, Gilbert

  Churchill, W. S.

  Green, Alan

  Loveridge, John

  Clark, William (Surrey, E.)

  Grieve, Percy

  Luce, R. N.

  Clarke, Kenneth (Rushcliffe)

  Griffiths, Eldon (Bury St. Edmunds)

  McAdden, Sir Stephen

  Clegg, Walter

  Grylls, Michael

  MacArthur, Ian

  Cockeram, Eric

  Gummer, Selwyn

  McCrindle, R. A.

  Cooke, Robert

  Curden, Harold

  McLaren, Martin

  Coombs, Derek

  Hall, Miss Joan (Keighley)

  Maclean, Sir Fitzroy

  Cooper, A. E.

  Hall, John (Wycombe)

  McMaster, Stanley

  Cordle, John

  Hall-Davis, A. G. F.

  Macmillan, Maurice (Farnham)

  Corfield, Rt. Hn. Frederick

  Hamilton, Michael (Salisbury)

  McNair-Wilson, Michael

  Cormack, Patrick

  Hannam, John (Exeter)

  McNair-Wilson, Patrick (NewForest)

  Costain, A. P.

  Harrison, Brian (Maldon)

  Maddan, Martin

  Madel, David

  Powell, Rt. Hn. J. Enoch

  Taylor, Sir Charles (Eastbourne)

  Marten, Neil

  Price, David (Eastleigh)

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

  Mather, Carol

  Proudfoot, Wilfred

  Taylor, Frank (Moss Side)

  Maude, Angus

  Pym, Rt. Hn. Francis

  Taylor, Robert (Croydon, N, W.)

  Maudling, Rt. Hn. Reginald

  Quennell, Miss J. M.

  Tebbit, Norman

  Mawby, Ray

  Rawlinson, Rt. Hn. Sir Peter

  Temple, John M.

  Maxwell-Hyslop, R. J.

  Redmond, Robert

  Thatcher, Rt. Hn. Mrs. Margaret

  Meyer, Sir Anthony

  Reed, Laurance (Bolton, E.)

  Thomas, John Stradling (Monmouth)

  Mills, Peter (Torrington)

  Rees, Peter (Dover)

  Thomas, Rt. Hn. Peter (Hendon, S.)

  Mills, Stratton (Belfast, N.)

  Rees-Davies, W. R.

  Thompson, Sir Richard (Croydon, S.)

  Miscampbell, Norman

  Renton, Rt. Hn. Sir David

  Tilney, John

  Mitchell, Lt.-Col. C. (Aberdeenshire, W)

  Rhys Williams, Sir Brandon

  Trafford, Dr Anthony

  Mitchell, David (Basingstoke)

  Ridley, Hn. Nicholas

  Trew, Peter

  Moate, Roger

  Ridsdale, Julian

  Tugendhat, Christopher

  Molyneaux, James

  Rippon, Rt. Hn. Geoffrey

  Turton, Rt. Hn. Sir Robin

  Money, Ernle

  Roberts, Michael (Cardiff, N.)

  van Straubenzee, W. R.

  Monks, Mrs. Connie

  Rodgers, Sir John (Sevenoaks)

  Vaughan, Dr. Gerard

  Monro, Hector

  Rossi, Hugh (Hornsey)

  Vickers, Dame Joan

  Montgomery, Fergus

  Rost, Peter

  Waddington, David

  Morgan, Geraint (Denbigh)

  Russell, Sir Ronald

  Walder, David (Clitheroe)

  Morgan-Giles, Rear-Adm.

  St. John-Stevas, Norman

  Walker, Rt. Hn. Peter (Worcester)

  Morrison, Charles (Devizes)

  Sandys, Rt. Hn. D.

  Walker-Smith, Rt. Hn. Sir Derek

  Mudd, David

  Scott, Nicholas

  Wall, Patrick

  Murton, Oscar

  Scott-Hopkins, James

  Walters, Dennis

  Nabarro, Sir Gerald

  Sharples, Richard

  Ward, Dame Irene

  Neave, Airey

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

  Warren, Kenneth

  Nicholls, Sir Harmar

  Shelton, William (Clapham)

  Weatherill, Bernard

  Noble, Rt. Hn. Michael

  Simeons, Charles

  Wells, John (Maidstone)

  Normanton, Tom

  Sinclair, Sir George

  White, Roger (Cravesend)

  Nott, John

  Skeet, T. H. H.

  Whitelaw, Rt. Hn. William

  Onslow, Cranley

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

  Wiggin, Jerry

  Oppenheim, Mrs. Sally

  Soref, Harold

  Wilkinson, John

  Orr, Capt. L. P. S.

  Speed, Keith

  Wolrige-Gordon, Patrick

  Osborn, John

  Spence, John

  Wood, Rt. Hn. Richard

  Owen, Idris (Stockport, N.)

  Sproat, lain

  Woodhouse, Hn. Christopher

  Page, Graham (Crosby)

  Stainton, Keith

  Woodnutt, Mark

  Page, John (Harrow, W.)

  Stanbrook, Ivor

  Worsley, Marcus

  Parkinson, Cecil (Enfield, W.)

  Stewart-Smith, D. G. (Belper)

  Wylie, Rt. Hn. N. R.

  Peel, John

  Stodart, Anthony (Edinburgh, W.)

  Younger, Hn. George

  Percival, Ian

  Stoddart-Scott, Col. Sir M.

  Peyton, Rt. Hn. John

  Stokes, John

  TELLERS FOR THE AYES :

  Pike, Miss Mervyn

  Stuttaford, Dr. Tom

  Mr. Reginald Eyre and

  Pink, R. Bonner

  Sutcliffe, John

  Mr. Jasper More.

  Pounder, Rafton

  Tapsell, Peter

  NOES

  Abse, Leo

  Cocks, Michael (Bristol, S.)

  English, Michael

  Albu, Austen

  Cohen, Stanley

  Evans, Fred

  Allaun, Frank (Salford, E.)

  Coleman, Donald

  Faulds, Andrew

  Allen, Scholefield

  Concannon, J. D.

  Fernyhough, Rt. Hn. E.

  Archer, Peter (Rowley Regis)

  Conlan, Bernard

  Fisher, Mrs. Doris (B'ham, Ladywood)

  Armstrong, Ernest

  Corbet, Mrs. Freda

  Fitch, Alan (Wigan)

  Ashley, Jack

  Cox, Thomas (Wandsworth, C.)

  Fitt, Gerard (Belfast, W.)

  Ashton, Joe

  Crawshaw, Richard

  Fletcher, Ted (Darlington)

  Atkinson, Norman

  Cronin, John

  Foley, Maurice

  Bagier, Gordon A. T.

  Crosland, Rt. Hn. Anthony

  Foot, Michael

  Barnett, Guy (Greenwich)

  Crossman, Rt. Hn. Richard

  Ford, Ben

  Barnett, Joel

  Cunningham, G. (Islington, S. W.)

  Forrester, John

  Benn, Rt. Hn. Anthony Wedgwood

  Dalyell, Tam

  Fraser, John (Norwood)

  Bennett, James (Glasgow, Bridgeton)

  Darling, Rt. Hn. George

  Freeson, Reginald

  Bidwell, Sydney

  Davidson, Arthur

  Galpern, Sir Myer

  Bishop, E. S.

  Davies, Denzil (Llanelly)

  Garrett, W. E.

  Blenkinsop, Arthur

  Davies, G. Elfed (Rhondda, E.)

  Gilbert, Dr. John

  Boardman, H. (Leigh)

  Davies, Ifor (Gower)

  Ginsburg, David

  Booth, Albert

  Davies, S. O. (Merthyr Tydvil)

  Golding, John

  Bottomley, Rt. Hn. Arthur

  Davis, Clinton (Hackney, C.)

  Gordon Walker, Rt. Hn. P. C.

  Boyten, James (Bishop Auckland)

  Davis, Terry (Bromsgrove)

  Gourlay, Harry

  Bradley, Tom

  Deakins, Eric

  Grant, George (Morpeth)

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

  de Freitas, Rt. Hn. Sir Geoffrey

  Grant, John D. (Islington, E.)

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

  Defargy, H J.

  Griffiths, Eddie (Brightside)

  Brown, Ronald (Shoreditch & F'bury)

  Dell, Rt. Hn. Edmund

  Griffiths, Will (Exchange)

  Buchan, Norman

  Dempsey, James

  Grimond, Rt. Hn. J.

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

  Doig, Peter

  Gunter, Rt. Hn. R. J.

  Butler, Mrs. Joyce (Wood Green)

  Dormand, J. D.

  Hamilton, William (Fife, W.)

  Callaghan, Rt. Hn. James

  Douglas, Dick (Stirlingshire, E.)

  Hamling, William

  Campbell, I. (Dunbartonshire, W.)

  Douglas-Mann, Bruce

  Hannan, Wiliam (G'gow, Maryhill)

  Cant, R. B.

  Duffy, A. E. P.

  Hardy, Peter

  Carmichael, Neil

  Dunn, James A.

  Harrison, Walter (Wakefield)

  Carter, Ray (Birmingh'm, Northfield)

  Dunnett, Jack

  Hart, Rt. Hn. Judith

  Carter-Jones, Lewis (Eccles)

  Eadie, Alex

  Hattersley, Roy

  Castle, Rt. Hn. Barbara

  Edelman, Maurice

  Healey, Rt. Hn, Denis

  Clark, David (Colne Valley)

  Ellis, Tom

  Heffer, Eric S.

  356

  357

  Hilton, W. S.

  McNamara, J. Kevin

  Rodgers, William (Stockton-on-Tees)

  Hooson, Emlyn

  Mahon, Simon (Bootle)

  Roper, John

  Horam, John

  Mallalieu, E. L. (Brigg)

  Ross, Rt. Hn. William (Kilmarnock)

  Houghton, Rt. Hn. Douglas

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

  Sandelson, Neville

  Howell, Denis (Small Heath)

  Marks, Kenneth

  Sheldon, Robert (Ashton-under-Lyne)

  Huckfield, Leslie

  Marquand, David

  Shore, Rt. Hn. Peter (Stepney)

  Hughes, Rt. Hn. Cledwyn (Anglesey)

  Marsden, F.

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

  Hughes, Mark (Durham)

  Marshall, Dr. Edmund

  Short, Mrs. Renée (W'hampton, N.E.)

  Hughes, Robert (Aberdeen, N.)

  Mason, Rt. Hn. Roy

  Silkin, Rt. Hn. John (Deptford)

  Hunter, Adam

  Mayhew, Christopher

  Silkin, Hn. S. C. (Dulwich)

  Irvine, Rt. Hn. SirArthur (Edge Hill)

  Mellish, Rt. Hn. Robert

  Sillars, James

  Janner, Greville

  Mendelson, John

  Silverman, Julius

  Jay, Rt. Hn. Douglas

  Mikardo, Ian

  Skinner, Dennis

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

  Millan, Bruce

  Small, William

  Jenkins, Hugh (Putney)

  Miller, Dr. M. S.

  Smith, John (Lanarkshire, N.)

  Jenkins, Rt. Hn. Roy (Stechford)

  Milne, Edward (Blyth)

  Spearing, Nigel

  John, Brynmor

  Mitchell, R. C. (S'hampton, Itchen)

  Spriggs, Leslie

  Johnson, Carol (Lewisham, S.)

  Molloy, William

  Stallard, A. W.

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

  Morgan, Elystan (Cardiganshire)

  Steel, David

  Johnson, Walter (Derby, S.)

  Morris, Alfred (Wythenshawe)

  Stewart, Donald (Western Isles)

  Johnston, Russell (Inverness)

  Morris, Charles R. (Openshaw)

  Stoddart, David (Swindon)

  Jones, Barry (Flint, E.)

  Morris, Rt. Hn. John (Aberavon)

  Stonehouse, Rt. Hn. John

  Jones, Dan (Burnley)

  Moyle, Roland

  Strang, Gavin

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

  Murray, Ronald King

  Strauss, Rt. Hn. G. R.

  Jones, Gwynoro (Carmarthen)

  Ogden, Eric

  Summerskill, Hn. Dr. Shirley

  Jones, T. Alec (Rhondda, W.)

  O'Halloran, Michael

  Taverne, Dick

  Judd, Frank

  O'Malley, Brian

  Thomas, Rt. Hn. George (Cardiff, W.)

  Kaufman, Gerald

  Oram, Bert

  Thomas, Jeffrey (Abertillery)

  Kelley, Richard

  Orme, Stanley

  Thomson, Rt. Hn. G. (Dundee, E.)

  Kerr, Russell

  Oswald, Thomas

  Thorpe, Rt. Hn. Jeremy

  Kinnock, Neil

  Owen, Dr. David (Plymouth, Sutton)

  Tinn, James

  Lambie, David

  Padley, Walter

  Tomney, Frank

  Lamond, James

  Paget, R. T.

  Torney, Tom

  Latham, Arthur

  Palmer, Arthur

  Tuck, Raphael

  Lawson, George

  Pannell, Rt. Hn. Charles

  Urwin, T. W.

  Leadbitter, Ted

  Pardoe, John

  Varley, Eric G.

  Lee, Rt. Hn. Frederick

  Parker, John (Dagenham)

  Wainwright, Edwin

  Leonard, Dick

  Parry, Robert (Liverpool, Exchange)

  Walden, Brian (B'm'ham, All Saints)

  Lever, Rt. Hn. Harold

  Peart, Rt. Hn. Fred

  Wallace, George

  Lewis, Arthur (W. Ham, N.)

  Pendry, Tom

  Watkins, David

  Lewis, Ron (Carlisle)

  Pentland, Norman

  Weitzman, David

  Lipton, Marcus

  Perry, Ernest G.

  Wellbeloved, James

  Lomas, Kenneth

  Prentice, Rt. Hn. Reg.

  Wells, William (Walsall, N.)

  Loughlin, Charles

  Prescott, John

  White, James (Glasgow, Pollok)

  Lyon, Alexander W. (York)

  Price, J. T. (Westhoughton)

  Whitehead, Phillip

  Lyons, Edward (Bradford, E.)

  Price, William (Rugby)

  Whitlock, William

  Mahon, Dr. J. Dickson

  Probert, Arthur

  Willey, Rt. Hn. Frederick

  McBride, Neil

  Rankin, John

  Williams, Mrs. Shirley (Hitchin)

  McCann, John

  Reed, D. (Sedgefield)

  Wilson, Alexander (Hamilton)

  McCartney, Hugh

  Rees, Merlyn (Leeds, S.)

  Wilson, Rt. Hn. Harold (Huyton)

  McElhone, Frank

  Rhodes, Geoffrey

  Wilson, William (Coventry, S.)

  McGuire, Michael

  Richard, Ivor

  Woof, Robert

  Mackenzie, Gregor

  Roberts, Albert (Normanton)

  Mackie, John

  Roberts, Rt. Hn. Goronwy (Caernarvon)

  TELLERS FOR THE NOES :

  Maclennan, Robert

  Robertson, John (Paisley)

  Mr. Joseph Harper and

  McMillan, Tom (Glasgow, C.)

  Roderick, Caerwyn E.(Br'c'n&R'dnor)

  Mr. James Hamilton.

  Resolved,
  That this House, recognising the special problems that have arisen in Scotland and the regrettably high unemployment accompanying them, which has resulted from the inflationary policies pursued by the last Government, endorses the measures introduced by Her Majesty's Government, including the creation of a special development area covering West Central Scotland and other powerful incentives for regional development, as relevant and effective for dealing with this situation.

BUSINESS OF THE HOUSE
Ordered,
That at this day's Sitting the Motion relating to Education (Scotland) may be proceeded with, though opposed, until half-past Eleven o'clock, and that the Housing Bill, and the Mineral Workings (Offshore Installations) Bill [Lords], may be proceeded with. though opposed, until any hour.—[Mr. Monro.]

SCOTLAND (GRANT-AIDED SECONDARY SCHOOLS)
10.24 p.m.
Mr. Norman Buchan: I beg to move,
That the Grant-Aided Secondary Schools (Scotland) Grant (Amendment) Regulations 1971 (S.I., 1971, No. 558) be withdrawn.
This short debate is taking place against a background different from the usual. It has been the custom in the past that discussions on Regulations of this sort have centred upon the amounts of grant to be paid and the question whether the figures should be increased or reduced. Today, however, we face a rather different situation.
I want to put the figures into the perspective of what the Government have done over the past 12 months, particularly in education. There are 29 grant-aided schools in Scotland. We sometimes hear more about the grant-aided and independent schools from hon. Members opposite than about the basic structure of education. The Regulations apply to about 20,000 pupils.
I find the Regulations very strange. The total amount in the Schedule comes to £1,550,990, exactly the same figure as was in the Regulations of 1969. That is strange, because when we introduced those those similar Regulations they came under a particularly vicious attack. For example, the Under-Secretary of State for Development said that the Order was :
"economic nonsense and educational eyewash, and that is why it should be opposed."
Even more important, the Under-Secretary in charge of education said this about those same figures :
"They are spiteful little Regulations.. This is a silly, unnecessarily spiteful move …"
In case we did not get the point, he said one paragraph later :
"an unnecessarily spiteful crack at these schools and all that they stand for."—[OFFICIAL REPORT, 1st July, 1969; Vol. 786, c. 374–376.]
That was said two years ago when costs were not so high as they are under the present, benighted Government. Therefore, we look with some care at the Regulations, as we always do at Tory measures.
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If the figures then were spiteful, do the figures in the Schedule really represent the amount the Government intend to give to the fee-paying, grant-aided sector? If they were petty then, the figures they have produced for their friends in those privileged schools must be even pettier and meaner. We are accustomed to petty and mean things from them, but not towards their friends.
Therefore, we must look at some of the small print, where the Regulations say that when
"… an increase has taken place since October 1969 in the levels of prices, costs or remuneration …"
the Secretary of State may give such increase in the grant as he may determine. The figures are either meaningful, in which case everything the Minister said two years ago was hypocritical nonsense, or they are to mean nothing, and we are getting an open-ended commitment.
I should like to know just what ceiling the Minister has in mind, or whether he has any ceiling in mind for the amount of assistance he will give those fee-paying schools.
We see the Regulations against a double background. During the last discussion there was a big attack on us for having set up the Public Schools Commission. The first aspect of the background is the question of what was to be done with the grant-aided schools. The Commission has reported, and what a devastating Report it is! For example, it said on page 73 of the Second Report, Volume III :
"We believe that public feeling and educational opinion is now clearly opposed to selection for secondary education, and few would wish a return to the old selective system, …"
The few who would wish a return include the present members of the Tory Administration, cutting right across all educational progress in the past quarter of a century. The Report continues :
"… Britain allows a larger proportion of her young people to drop out of school than her neighbours and major competitors, and is already severely handicapped by this waste of talent."
The Commission puts it down to the divisive nature of our school education.

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The Report says :
"An educational system which enables a fortunate minority of children to take their education a long way while permitting the rest to leave school for the labour market at the minimum leaving age is obsolete."
This Government are not only trying to turn the clock back and ensure again that the minority are brought up and educated in a divisive structure. They cannot even guarantee any longer that the jobs will be there for the children when they leave school. That is the first background against which we are discussing the Regulations.
The Report continues :
"There is no time to be lost in creating the new system we need …"
We might have looked forward, in view of the publication of this devastating Report, to some understanding of this in the Regulations.
"Fee-paying would effectively exert a selective influence—both socially and educationally …"
The Report spells out above all the need for a move towards a one-nation type of education—comprehensive education. It says :
"We therefore recommend that no school in a comprehensive system should charge fees since fee-paying is inconsistent with its objectives.
To attempt to operate a 'mixed economy' of selective and comprehensive and secondary schools is, as experience has shown, to create two different types of schools, differing in status, esteem and morale … this seems to us to be well illustrated in the evidence we received about the present Edinburgh situation. In our view, therefore, all schools in the public system of education should fulfil comprehensive roles in local schemes of reorganisation."
We have now had the Report and there is not one flicker of understanding, one iota of proof, in these Regulations that the Government have even read the Report. Yet they could have taken cognisance of it in order to move towards the wise findings of this high-powered Commission.
The other background of these Regulations is what the Government have done in their social and education policies since they came to power. There is the question of the return of fee-paying in local authority schools.
Mr. Ian MacArthur: Hear, hear.
Mr. Buchan: But not content with the entire privileged sector of the grant-aided schools, and not content with the privileged sector of the independent and public schools, they are attempting—and it is no more than an attempt—to restore local authority fee-paying schools.
Mr. MacArthur: Hear, hear.
Mr. Buchan: What an image of privilege and élitism this Government show in Scotland. That was not the only thing. Consider their treatment of the children within the State sector, those whom they have left out of their worries about the independent and fee-paying local authority schools, the ordinary kids of Scotland, against a background of 121,000 unemployed, with the number of school meals being taken dropping because parents can no longer afford them in their increasing poverty.
Mr. MacArthur Mr. MacArthur rose—
Mr. Buchan: Take your time. This is the background against which these Regulations are designed to perpetuate the small, privileged sector of 29 schools.
Mr. MacArthur: If the hon. Gentleman wishes to refer to school meals, I am sure he will be fair about events in Scotland. The figures show that where 15 children took school meals previously 14 take them now. Against that, where 15 children had free school meals before 19 children have them now. This demonstrates that help is being concentrated where help is really needed. Those are the Scottish figures.
Mr. Buchan: The Scottish figures were published today. As my hon. Friend the Member for Greenock (Dr. Mabon) said earlier, "Look at HANSARD and find out for yourself." The number of school meals has been dropping. It has dropped already by about one-fifth. The number of free school meals has been increasing—up to something like 41 per cent. of the total ; it is probably more with each week that passes. The point is that this increase indicates an increase in poverty. If hon. Members opposite do not understand that, they understand nothing and should take their hands off the social services before they do any more damage.
Mr. MacArthur: The hon. Gentleman will surely concede that it is above all

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an indication of the increasing band of income within which free school meals are permitted by the Government.
Mr. Buchan: That is not so.
Mr. MacArthur: It is so.
Mr. Buchan: Many of the measures introduced are not yet biting. The other point is that we have seen the statistics of the increasing poverty. They are there to see every month in the Department of Employment's figures. The increase in poverty is coming from the increase in the unemployment. Most of the increases in social benefits have already been eroded by rampant inflation. Poverty is increasing within our ordinary State schools—that is one background against which this privilege must be looked at.
The other background is the financial policies and political dogmas of the Government. What have the three budgets been about? First, they have been in order to cut down public expenditure.
Mr. T. G. D. Galbraith: Hear, hear.
Mr. Buchan: Secondly, they have been to reduce taxation.
Mr. MacArthur: Hear, hear.
Mr. Galbraith: Hear, hear.
Mr. Buchan: Thirdly, they have been to make sure that all the beneficial effects of cutting public expenditure are borne by ordinary people so that tax cuts for the wealthy are paid for by the poor.
Mr. MacArthur: Rubbish.
Mr. Galbraith: Come off it.
Mr. Buchan: Yet the Government, dedicated to cutting public expenditure, produce an open-ended commitment to increasing public expenditure for these grant-aided schools. Where is the cut in public expenditure here? In other words, they are prepared to cut expenditure on school meals ; they are prepared to cut public expenditure by depriving primary school children between the ages of seven and 12 of free school milk. But they are not prepared to cut public expenditure which keeps 20,000 children in a privileged sector of education. They have a curious view of what constitutes social priorities.
Mr. MacArthur: I am grateful to the hon. Member for his courtesy in giving way again. Surely he will recognise that what the Government have done is to direct far greater expenditure to a priority area of need, which is in the State primary schools, which were so grievously neglected by the last Government. That is where the need exists and that is where the money is going—to help young children on the threshhold of education in State primary schools. Cut out all this bunkum!
Mr. Buchan: The hon. Gentleman is wrong again. Is he really saying—
Mr. MacArthur: Yes, I am.
Mr. Buchan: —that the money to be saved by cutting down school meals is to be used for increased building for primary education? That is what he is saying. He should listen to his right hon. Friend the Secretary of State for Education and Science. She said the same thing, but when challenged she said, "Well, when one is stuck for something else to do it is a useful thing to run what is an intellectual exercise." That is all it was. It had nothing to do with expansion of primary schools. The hon. Gentleman should read what members of his Government say before springing to their defence so quickly.
Mr. MacArthur: Total distortion.
Mr. Buchan: We are dealing with a situation in which £1½ million, as a beginning—we do not know how much more is to come—is to be given in the form of grants for these 29 schools while £1 million is being saved by taking away free school milk. Are these the hon. Gentleman's priorities for the children on the threshold of education?
Mr. MacArthur: I am obliged to the hon. Gentleman for his constant courtesy. He is bandying figures around. Does he not recognise that the Government have already put £4½ million more into primary school building in Scotland, which is only the beginning of the increase in the priority area of need?
Mr. Buchan: We have not yet seen the buildings. The sum of £1½ million is to be spent by a Government pledged to cutting public expenditure in order to keep a privileged sector in being while at the same time they are withdrawing £1

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million for free milk for children in the free sector of education to pay for it.
Mr. John Brewis Mr. John Brewis (Galloway) rose—
Mr. Buchan: I will not give way ; I have given way five times. The one person I will give way to is the Under-Secretary of State. When asked about the Common Market on Sunday, he said for the first time in his life that he had no comment. When asked to comment on the no comment, he said that he had no comment on the no comment.
The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor): The hon. Gentleman has made very great play of the £1½ million which the Government will give to the grant-aided schools this year which he thinks is outrageous. May I ask the hon. Gentleman, with his great knowledge of education, how much the Labour Government gave grant-aided schools in Scotland last year? I think he will find that the answer is £1½ million.
Mr. Buchan: The hon. Gentleman does not even listen. I started by making precisely that point. I even added up the figures. I did not merely say that the figure was £1½ million ; I said that it was £1,550,000 and gave the odd digits. I wish the hon. Gentleman would listen. That is one thing we want of a Minister responsible for education.
It is astonishing that after the protestations of two years ago the Government have not increased the amendment officially but have left an open-ended formula. I believe that this is an open-ended formula. I want to know the ceiling which the Government propose.
Why do I criticise this amount when it is exactly the same as the amount when we were in office? The answer is that we have had the Report of the Public Schools Commission and we now know what we should be doing with the grant-aided schools. We should be moving them into the general public sector. What is criminal about the Government's proposals is that they are cutting public expenditure for the poor and continuing it for the rich—in fact, since it is open-ended, they are increasing it for the rich—and at the same time are failing to respond to the needs of education.
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The Secretary of State for Trade and Industry, in his famous "lame ducks" speech, said :
"The vast majority lives and thrives in a bracing climate and not in a soft, sodden morass of subsidised incompetence."—[OFFICIAL REPORT, 4th November, 1970 ; Vol. 805, c. 1212.]
But the same Government who are horror-stricken at the thought of subsidising Upper Clyde Shipbuilders are not against subsidy when it is for their own people.
Mr. MacArthur: Nonsense.
Mr. Buchan: This is exactly what it is. They are not against subsidy when it is for their own people. They welcome this kind of expenditure but oppose every other kind. We are back to the same problem : they are for the rich, the poor they cut. They want subsidy as long as—
Mr. Galbraith Mr. Galbraith rose—
Mr. Buchan: I will deal with the hon. Gentleman in a moment.
Secondly, there is the problem of written-in selection. Not long ago the Minister said that he was not worried about fee-paying in schools. He said that that was not the problem. He is not worried about perpetuating fee-paying as long as he can abolish selection. This is the bargain he offered two years ago. He was prepared to come to an agreement that as long as he could achieve selection fees could go. Is not that so? Can he not even answer this? If he does not want to answer let him look at column 190 of the 1969 Bill Committee proceedings.
This Government have not only brought back the right of selection but have under-pinned it by giving the right to bring back the local authority fee-paying school, so that privileged parents can buy selection. They are also repeating the same framework in the Regulations for grant-aided schools ; not only can parents get selection but they can buy selection. I will give way to the hon. Member for Perth and East Perthshire (Mr. MacArthur) voluntarily if he wants to tell me what is wrong with this argument. He does not ; so they want to buy selection.
There is a difference from England. It is £1½ million in Scotland, more in

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England, but we were told of the virtues of the 25 per cent. intake of free pupils into English grant-aided schools. Without any problem for their dogmas, the Government could have done the same in these Regulations. There is no extension here of the 25 per cent. increase in free places, so they cannot even hold true to that. We are back once more to the question of two nations in education, where school meals, school milk and educational opportunities have been cut and, on the other hand, fee-paying schools have been strengthened.
The effect of this is most clearly seen in Edinburgh. Throughout discussions on local authority fee-paying schools, we pointed out that with the continuation of the grant aided local authority and independent schools, 60 per cent. of the pupils in the fifth year, and 75 per cent. of the pupils in the sixth year of Edinburgh secondary schools were in the fee-paying sector. The result is to create a narrow top to the state sector schools and to cream off staffing resources from the state sector schools into fee-paying schools, creating the very anomaly and bad effect upon the State sector that the Public Schools Commission proved. There is not an atom of response to that report here. The same grant-aided schools will continue at a minimum to receive the same grant. Therefore, it is clear, from the report, the actions of the Government and the Regulations that the whole position is incompatible. We accept and are considering how best to implement the recommendations of the Public Schools Commission. In 1971 we can no longer continue to have two nations and an educational system designed to create two nations.
Mr. Galbraith: Does this mean that the hon. Gentleman does not believe in variety in education and would stop parents having the right to choose the school?
Mr. Buchan: Of course we believe in variety. The only kind of variety the hon. Gentleman can see is that which is paid for or that which is not paid for. What a blinkered vision! Why cannot we have a hundred different types of school? Is a grant-aided school necessary, is exclusiveness of education necessary, to achieve this? The hon. Gentleman is talking about privilege
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under the guise of variety. No variety for his children ; no experimental schools there ; but a good fee-paying Scottish traditional school.
Mr. Galbraith: Quite right.
Mr. Buchan: No variety. We have had enough of this throughout the last twelve months from the Government and their supporters, and we want no more of it.
Mr. Brewis Mr. Brewis rose—
Mr. Buchan: This is the ninth intervention in a short speech.
Mr. Brewis: In view of what the hon. Member has said, will he say specifically that his party intends to abolish both grant-aided and independent schools?
Mr. Buchan: I said that we accept the recommendations of the Public Schools Commission that the grant-aided schools should be phased towards absorption in the State sector, and we are considering how best to do this. I emphasise the word "phasing" for the simple reason that some parents have sent their children in good faith to these schools and therefore it should be done gradually over a period of years.
Mr. MacArthur: What should be done gradually?
Mr. Buchan: I have told the hon. Gentleman. We have made successive statements on this at last year's Labour Party conference, and now from me.
Mr. MacArthur: Come clean.
Mr. Buchan: I have come clean, absolutely clean. We are going to work this through, and this is what will happen. Hon. Gentlemen had better start counting their coppers ; they may have to pay more for their fees.
Mr. MacArthur: What is to happen?
Mr. Buchan: You had better make up your mind.
Mr. William Ross: Tell him to read the report.
Mr. Buchan: Yes, I would ask the hon. Member for Perth and East Perthshire (Mr. MacArthur) to read the report. He must make up his mind that no longer are we to continue a system where half of the privileges are to be paid for by the; taxpayer.
Mr. MacArthur Mr. MacArthur rose—
Mr. Buchan: If hon. Gentlemen want snobbery and privilege, they should be prepared to pay for them.
Our attitude has been hardened and reinforced by the behaviour of the present Government. The line they have taken throughout all our debates on the social services, education and everything else from the beginning has been the creation of two nations.
Mr. MacArthur Mr. MacArthur rose—
Mr. Buchan: The hon. Member for Perth and East Perthshire has tried to interrupt me about seven times, and he still wants privilege. Well, I will give him the privilege this time by giving way.
Mr. MacArthur: The hon. Gentleman has given me much more than my fair share of interventions, but I am confused as to what it is he will do gradually over a period of years. Will he come clean and say whether it is his party's intention to abolish grant-aided schools in Scotland? This is what we want to know—will he tell us?
Mr. Buchan: This has been made very clear twice—most recently by my right hon. Friend the Member for Newcastle-upon-Tyne. Central (Mr. Edward Short)—for England and Wales.
Mr. MacArthur: Yes or no?
Mr. Buchan: We have the problem of working this out for Scotland. I am saying that over a period of years this is the way I would do it. [Interruption.] I will continue if hon. Gentlemen opposite will show an atom of politeness. The last Minister who spoke from the Government benches refused to give way, even after insulting my hon. Friend.
Mr. MacArthur: Be generous.
Mr. Buchan: It is not a question of being generous. Do not be so patronising. The gentlemen's party opposite fight for privilege and want to keep that privilege, but they now want other people to pay for it. [Interruption.] They sometimes have the manners of the farmyard.
Mr. MacArthur: Answer.
Mr. Buchan: I have said what will happen. The recommendation of the report was a successive phasing out—
Mr. MacArthur: What will the hon. Gentleman do?
Mr. Buchan: Shut up for a moment and I will tell you.
Mr. Deputy Speaker (Sir R. Grant-Ferris): Order. We must try to be a little quieter than we are. I am sure the hon. Member for Renfrew, West (Mr. Buchan) wants to give time for some other hon. Members to speak, and the more interventions there are the less chance of an opportunity for other hon. Members to participate.
Mr. Buchan: The recommendation has been made in the Report of the Public Schools Commission and we are now working out how best to carry it into effect. If hon. Gentlemen opposite want privilege, then they will have to be prepared to pay for it—and it is about time.
10.54 p.m.
Mr. Hugh D. Brown: It might be for the benefit of the House if a different voice is heard on educational matters.
Hon. Members: Hear, hear.
Mr. Brown: Hon. Gentlemen opposite had better relax because this does not mean that I am on their side. It is just that I thought my remarks might make the debate a little more interesting than were the continuous and protracted debates that took place on this subject earlier in the year.
I wish to ask the Minister one or two pertinent questions to which we are entitled to receive replies. I shall not go into the argument about who gave what and whether this is the same or less than the Labour Government gave. The general principle is that, as this is the first opportunity that the Under-Secretary has had in his official capacity, he will try to justify the present system. I am not arguing whether it is £1½ million or £2 million.
I should like to know what percentage of the pupils at the schools listed in the Regulations leave at 15 years of age compared with those who leave the ordinary State scheme? Has any estimate been made, because the hon. Gentleman has been under pressure from all the teaching organisations, if and when the

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school-leaving age is raised, of the number of pupils from these schools who might be among those who go to further education centres? Has any projection been made of the impact that the raising of the school-leaving age will make on these schools? Have any of the schools in the Schedule suggested that they should have some comparable designation because they suffer from teacher shortage? Will the hon. Gentleman give us some information on the problems which they face concerning teachers?
Finally, have the Government given any consideration to the Report of the Public Schools Commission? The Minister will have plenty of time to get the information. It seems that hon. Gentlemen opposite are doing their own case a disservice. Two of the best suburban schools in or near Glasgow are Milngavie and Newton Mearns, neither of which is fee-paying. I am referring to Protestant schools. Why? Because both are modern, fully staffed, schools. This is what we should be aiming for. We should not be trying to justify a system of privilege which is quite out of date.
10.58 p.m.
Mr. Ian MacArthur: I am grateful to the hon. Member for Renfrew, West (Mr. Buchan) for his great courtesy in giving way to me so generously when I tried to interrupt him during his speech. I hope that I did not overdo it, but I was encouraged to interrupt because there were areas of uncertainty in his speech. I am sure that he will agree that it is important, in the name of democracy, that people in Scotland should know what the Labour Party has in mind concerning education.
I have been asking this question for some years now. The more answers I get the more confused I become, because the answers given by the hon. Gentleman and his colleagues are never clear. They live in muddy educational waters, and they seem muddier still with every reply that they give.
There is a great deal of uncertainty about the intentions of right hon. and hon. Gentlemen opposite for the future of the grant-aided schools. I have often spoken in debates about these schools and repeatedly asked whether the Labour Party intended to abolish them. I asked
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that same question tonight. However, I have had no answer beyond being told that over a period of years various things might happen, that they could not be revealed completely now, but that they might be in line with the recommendation of the Public Schools Commission. I did not think that the recommendation of the Commission was crystal clear. There are many who might not agree with the findings of the Commission about education. I thought that it was a tendentious and questionable Report.
The grant-aided schools in Scotland are an important part of the variety of education that we have. The independent, grant-aided and fee-paying sector in Scotland is very much smaller than the equivalent sector south of the Border, but I believe that the balance in Scotland is just about right for our needs. And because it is small and just about right for our needs I view with the gravest suspicion any assault on this sector of education by the Labour Party which, because of dogma, or something equally undesirable, constantly gives the impression that what it wants in Scotland is one system in education, with no choice whatsoever for the parents.
I remind hon. Gentlemen opposite that many children at grant-aided schools are there because their fathers' occupations take them abroad. A boarding school is necessary for them, and it is not available in any sector other than the grant-aided one, because the father is often not in a position to pay the very much higher fees which an independent school has to charge.
I believe that the grant-aided schools in Scotland meet a very important social need and that it would be educationally wrong to abolish them, as I suspect hon. Gentlemen opposite wish to do, although they have not the strength of determination to come out and say so clearly to the Scottish people. They will not say it clearly because they know that grant-aided schools have a particular place in the affections of the people of Scotland who do not want to see them abolished.
Hon. Gentlemen opposite have been waging a steadily mounting campaign against the education system in Scotland. There was their assault on the local authority fee-paying schools in 1969. Mercifully we were able to retrieve that situation just the other day. Tonight we

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have seen a resumption of their assault on the grant-aided schools.
I still ask what is the attitude of right hon. and hon. Gentlemen opposite to the independent schools in Scotland? I am sure that the hon. Gentleman is capable of giving a simple "Yes" or "No" answer to a simple question. Is it the intention of the Labour Party to abolish grant-aided schools, and soon after that to abolish the independent schools in Scotland? I often ask that question, but I am never given an answer, and I hate being in a position of uncertainty because I like giving clear answers to my constituents who ask these questions. I wish that the hon. Gentleman would help me to answer the questions that I am asked. Is it the Labour Party's intention to abolish grant-aided schools? Is it the Labour Party's intention to abolish independent schools?
I remind hon. Gentlemen opposite that a large sector of opinion in Scotland believes that the grant-aided schools contribute importantly to the pattern and variety of education in Scotland. That is a widely held view and is not confined to those whose children happen to go to these schools. I know that from my own experience. Many people feel that grant-aided schools play an important part in the Scottish education system.
The view that I have expressed about these schools is not simply mine or held only by those constituents who happen to have mentioned it to me. It is held by the Scottish Council. The hon. Gentleman knows the Scottish Council, and I am sure that he will have regard to its views. He often quotes what it says, and quite rightly, because it usually has wise things to say. One of the wisest things said by the Council was in a brochure directed at industrialists. It was a good brochure, as all these publications are, and one of the attractions to which the Council pointed for incoming industrialists was the variety and range of choice in Scottish education. If I remember aright, the Council specified the grant-aided schools and local authority fee-paying schools as particular attractions to the new, questing, zestful people whom we wish to attract to Scotland to help us to develop.
Yet these are the very schools which contribute so much to the educational scene in Scotland which the hon. Gentleman is trying to abolish. Perhaps he is
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not. We are in this great difficulty, as are the people of Scotland. They want to know. This question has been asked for many years and I wish that the hon. Gentleman would give a straight answer. Are they to be abolished or not? The question has been asked four times tonight and we have had four answers which are no answers at all. We want to know "Yes" or "No". It is right that we should know. Above all, these schools are part of the variety of Scottish education.
A large part of the strength of education in Scotland is the variety it provides. Behind this there is a large philosophical question. In education we must provide a freedom of choice for parents. This one of the areas of freedom of choice. It comes very strangely from these egalitarians opposite that the grant-aided schools must go or be absorbed over a period of years. We heard from them quite clearly, in 1969 and this year, that they abhor the local authority fee-paying schools and those are the two areas clearly under direct threat. The hon. Gentleman has come clean on this one. We know that he wants to get rid of the fee-paying local authority school and I suspect that he wants to get rid of the grant-aided school.
He has not said anything about the independent schools yet. What the hon. Gentleman and his egalitarian friends are trying to do is to remove freedom of choice from the parent who is not well off and restrict freedom of choice to the very rich parent who can afford to pay fees at the expensive public schools at which hon. Gentlemen opposite like poking fun. This seems to be a most extraordinary doctrine of Socialism—to restrict choice to the very rich. I want to spread choice as widely as possible in Scotland. In the spreading of choice the grant-aided schools have an essential rôle. That is why I welcome the Regulations.
I welcome the fact that in this proposal the grant-aided schools will be assisted in a way which will take note of inflation. That is right. I welcome the Regulations and I am sorry that hon. Gentlemen should have opposed them and obstinately refused to give us their policy in this essential sector of education which provides the freedom and variety which we need so much.
11.3 p.m.
Mr. John Smith: I listened carefully to the hon. Member for Perth and East Perthshire (Mr. Mac-Arthur) to discover the reason for the perpetuation of the grant-aided system. We had a number of arguments, one of which was that there was a great deal of affection for them. That did not seem to be a very powerful educational argument. We had the argument of variety of pattern, but it seemed to me that the needle in the gramophone got stuck at that point. The hon. Gentleman went on to develop the point a little further. He was talking about individual freedom. He said that it gives a pattern of variety and a variety of pattern and the gramophone went round and round as the hon. Member warmed to one of his favourite themes.
He seems to have two enthusiasms in this House. One is the defence of private education and the other the relief from rates for horse-breeding establishments. He holds these causes dear to his heart and lavishes on them all the skill of a part time adman. He did not come to the central point of the debate which is the challenge we are making to the perpetuation of these schools.
Before leaving that point, I will deal with the rather unfortunate method the Government are using in putting forward figures in these Regulations. They were apparently in use several years ago. There is in the Regulations power for the Secretary of State to make a substantial increase, as he thinks fit. What the Government are doing is putting a base line for their expenditure but not telling us how far they will go beyond the base line. In effect the Secretary of State is asking for a blank cheque from Parliament for the amount he may give the fee-paying schools. It would have been better if he had made a calculation going back to 1969 and come forward with actual figures that it is proposed to give to fee-paying schools. We could then have compared those statistics with the other figures he mentioned, such as the saving that will supposedly be made on school milk and so on. We might then have been able to make a true comparison.
I suspect that as soon as Parliament is misguided enough to give the Secretary of State the powers he is seeking
376
he will see to it that his friends in the grant-aided schools get more than £1½ million. If there is anything in all this talk about the need for variety, why must it always be accompanied by talk of finance? In other words, why must there be a financial barrier of this kind in the education system? Why cannot we have grant-aided schools that do not charge fees? Is Marr College not a good example? Is that the sort of pattern the hon. Member for Perth and East Perthshire has in mind? I suggest that the enthusiasm that is shown by hon. Gentlemen opposite for these schools would soon dwindle if fees were not involved.
It is interesting also to note that these schools are located, in the main, in Glasgow and Edinburgh. It seems strange that if variety is so important in this respect it has not been taken up by other areas. [Interruption.] I gather that the moans of hon. Gentlemen opposite are designed to indicate that fee-paying schools have been established in the odd other locality, but by and large they are in the central belt.
I doubt whether the hon. Member for Perth and East Perthshire goes galloping round his constituency advocating the establishment of fee-paying schools here, there and everywhere. In any event, I wonder if he advocates that in one breath and in the next discuss the relief of rates for horse breeding establishments with his constituents?
The Public Schools Commission dealt with this problem some time ago. When the hon. Member for Perth and East Perthshire was casting around for support for his case, he mentioned the Scottish Council. That caused my hon. Friends some wonderment. For example, my hon. Friend the Member for Glasgow, Wood-side (Mr. Carmichael) thought he was referring to the Scottish Council of the Labour Party.
It was a far cry from education for the hon. Gentleman to call in aid an organisation which is responsible for the development of industry. One would have imagined that he would have preferred to quote the experts who formed the Public Schools Commission. [Interruption.] They were experts, and I suspect that hon. Gentlemen opposite are interrupting without even knowing who sat on that Commission. The Chairman

377
was Mr. T. Ewan Faulkner, a former convener of Dundee Education Committee, and the Vice-Chairman was Mr. Roger Young, Headmaster of George Watson's College, Edinburgh. The other members included a former headmaster and the director of education for Midlothian, not to mention a principal of a college of education. The only person who might be said to have had any Left-wing leanings was a former hon. Member of this House. I notice that once hon. Gentlemen opposite are told the facts they interrupt no longer. The Public Schools Commission reported :
"It is easy to plead generally for variety in education, but concerned as we are about the total education system should aim to provide variety within the comprehensive system rather than attempt to reconcile what is in educational and social terms ultimately irreconcilable, the continuation of a minority of selective schools in an otherwise comprehensive pattern."
Earlier the Commission reported :
"The stratification of schools is inevitably at the expense of the comprehensive schools and of the education of the young people in them : this seems to us to be well illustrated in the evidence they received about the situation in Edinburgh."
We all know that no city has a worse educational stratification than Edinburgh. There are five different types of school in Edinburgh : comprehensive schools, local authority selective schools, local authority fee-paying schools, grant-aided schools and independent schools. It is the most elaborate pecking order that one could devise for an educational system.
As someone who lives in Edinburgh, I can say that this system causes great dismay throughout the city. I counsel the Conservative Party to be careful about what they are doing. They are the representatives of a dwindling minority of people. The majority of parents are beginning to realise the need to support the State education system. The Conservative Party ought to think a little wider than this and get out of the Perthshire syndrome of politics and think about their future, because increasingly parents are becoming less tolerant about the inequalities and absurdities existing in these direct grant schools.
One does not object to the schools themselves but to the fact that a fee has to be paid for entry to them. Why that is necessary I do not know. If we were starting from scratch, not one Member of
378
the House would argue that we should introduce fees into our education system. Hardly any Members of the House would claim that in another 15 years we will still have fees. Progress towards comprehensive education is going apace. It even has converts within the Conservative Party. Why should we have to suffer this interregnum and perpetuate, during that period, the inequalities and injustices that fall from the present system?
It is a pity that the people who do not realise the harm done by these things are trying to fight off the inevitable. I hope that we shall reach a situation when we will not have these distortions in our education system, either with fee-paying or direct grant schools, annd that the whole of Scotland will have the freedom of choice that the people of Perth have but those of Edinburgh do not have.
11.17 p.m.
The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor): This has been an astonishing debate because the Regulations are simple in their purpose and objective. As with every subject, when we hear the hon. Member for Lanarkshire, North (Mr. John Smith), and particularly the hon. Member for Renfrew, West (Mr. Buchan), I feel that if we were discussing land drainage Regulations or a hill sheep Order they would find the class war inherent in them.
But these Regulations are not about a class war. This is a simple procedure to bring up to date the Regulations introduced by the previous Administration in 1969, freezing the grants for grant-aided schools and to take account of rises in prices and costs. That is all that we are doing ; nothing more. We are taking account of the inflation which occurred under the previous Government and the inflation which is temporarily occurring under this Government.
We have heard hon. Members opposite fighting the class war. The hon. Member for Lanarkshire, North, had several rich arguments. I am afraid that the hon. Member for Renfrew, West, has had a busy day and has not even read what the Regulations are for. He asked why we have the same figure as we had in the previous Regulations. He said that this was a trick by the Tories to try to pinch money from their supporters. But what

379
we are doing is simply using this as the base and, on that base, we will have a percentage increase to take account of increased costs.
Mr. Buchan: As always, the hon. Gentleman has totally misunderstood the reason why I was surprised at the same figure being there. That is because of the hon. Gentleman's speech two years ago, when he said that the figure was spiteful. mean and inadequate. He is saying now that they are exactly the same.
Mr. Taylor: It was absolutely spiteful, mean and miserable, because what hon. Gentlemen opposite were doing was freezing the grants for good, thinking that they would create a situation in which costs would soar and fees would soar as a consequence.
The school year begins on 15th May, and we have based our calculation on the increase between October, 1969, and April, 1971, in costs incurred in such a school. The main such costs are teachers' salaries and other relevant costs such as heating, lighting and cleaning. Much of the relevant information on these is already available in connection with the calculations needed for R.S.G., and our provisional calculations suggest that relevant costs have increased by about 20 per cent.
We shall be writing to the schools shortly to inform them of the exact amount by which their grant will be increased. It would not be appropriate to set out revised amounts in Regulations, as this would again mean that we would be facing a situation which did not allow for an increase in the cost of living. We are bringing this up to date to take account of the increase in the cost of living.
Mr. Bruce Millan: Is the percentage increase to be applied to every school, or are there to be individual percentage increases for individual schools?
Mr. Taylor: I will deal with that in detail later. By and large it will take account of the increases as a whole, and we expect that 20 per cent. will be a rough figure. There is provision in the Regulations for going ahead from that.
We have had some other questions. The hon. Member for Renfrew, West said
380
that we were giving more money to the grant-aided schools and taking it from poor children. He talked about how there was an increase in the percentage of free school meals because of an increase in poverty. The hon. Gentleman must know that we have an increase in free school meals because there has been an increase in the exemption limits. In other words, we have made it possible for a wider range of people to be eligible for free school meals, which is part of the policy of this Government of ensuring that we give help where it is needed.
Mr. Buchan Mr. Buchan rose—
Mr. Taylor: This must be the last time.
Mr. Buchan: I gave way 11 times. This is on the question of exemptions. The number of free school meals remains a factor of poverty. The point about exemptions is to deal with the inflation and the rise in prices. The poverty factor remains the same. The hon. Gentleman must understand that.
Mr. Taylor: I try to understand what the hon. Gentleman says from time to time, but I regret to say that I do not always succeed, and I do not think that I am entirely alone in feeling this.
What about the justification for the Regulations? We honestly believe that there is a very real case for variety in education in Scotland. We think that excellence in education is more likely to result where there are different kinds of schools free to develop there own systems along their own lines. The hon. Member for Renfrew, West says, "Let us do away with these grants. Let us not have the Regulations." We would then have the ridiculous situation in which, as my hon. Friend the Member for Perth and East Perthshire (Mr. MacArthur) said in his excellent speech, there would not be freedom of choice for a large range of people in Scoland ; there would be freedom of choice only for the rich. It seems that this is the situation which the hon. Gentleman and his friends are trying to create.
The amending Regulations still operate on the basis of the 1969 "frozen grant" Regulations, not because we necessarily believe that these are the best and fairest way of disbursing central Government money to the schools, but because we

381
agree with the previous Government that it is sensible to give careful consideration to the future basis of grant to these schools ; and we do not intend to make any fundamental change in the present arrangements until this consideration has been completed.
We have had discussions with the governors of the schools. We are looking forward to hearing from them and at a later stage we shall be bringing forward our long-term proposals. We shall take careful account of some valuable points made by the hon. Member for Glasgow, Provan (Mr. Hugh D. Brown), who asked me a particular point about the percentage of those staying on at the various schools. The most up-to-date figures I have are those for 1968. These figures are taken from page 48 of the Second Report of the Public Schools Commission. Those who left at under 17 years of age, at 17 and 18 or over, were in the various categories 33 per cent., 55 per cent. and 12 per cent. for grant-aided schools and the corresponding figures for education authority schools are 84 per cent., 13 per cent. and 3 per cent. respectively.
Then the hon. Member for Renfrew, West presented the argument about this devasting report which condemned these schools and suggested that we should abolish them. The hon. Members for Lanarkshire, North and for Renfrew, West made several quotations from the Report, their suggestion being that here we have a splendid independent assessment by experts in education who, having approached this matter with an open mind, said. "We must do away with the schools".
I wonder whether those hon. Members, in their careful consideration of what was said, looked at the question which was put to the Commission. Was it asked to have an open mind? Was it asked to look at the whole system and say what could best be done with these schools? Not at all. The hon. Member for Lanarkshire, North knows quite well what the Commission was asked to do. Here are the terms of reference :
"To advise on the most effective method or methods"—
I emphasise those words—
"by which direct grant … schools in England and Wales and the grant-aided schools in
382
Scotland can participate in the movement towards comprehensive reorganisation …".
That was the question. The Commission was not—
Mr. John Smith: And, in the course of that consideration, the Commission came to the conclusion, in enthusiastic terms, that
"the consequent stratification of schools is inevitably at the expense of comprehensive schools and of the education of the young people in them".
It is obvious that the members of the Commission started with their remit, but they ended up as enthusiastic converts to getting rid of fees.
Mr. Taylor: If I were asked to take part in a Commission to try to encourage the consumption of alcohol in primary schools, I might well be rather reluctant to do so, being a sensible person and an office holder in the Band of Hope.
It is scandalous that the hon. Members for Renfrew, West and for Lanarkshire, North, with their other hon. Friends, have tried to mislead the public and other hon. Members who may not know the truth into thinking that we had here an independent Report in the way they described, when, in fact, the Commission was asked to look at these schools and see how they might be brought into the comprehensive system. The Commission did not come to the kind of conclusion that has been alleged, and the Opposition's attempt to make that point is an indication of the disgraceful level to which they have brought this debate.
I have been asked about the future. I have said that it is the Government's intention, because of the consultations we have had, to ensure that we give careful consideration to the future basis for grant and how it might be distributed. Hon. Members may wonder how long these interim Regulations are intended to last and when it is hoped to bring in a new long-term system of grant aid for schools. As I have said, we have had talks with representatives of the schools. We have asked them to let us have their views on, the arrangements for central Government grant for the schools, and, when they have completed their study of the matter, they will, I know, let us have their recommendations as soon as possible. The Government will then consider these recommendations most carefully in the

383
light of what is practicable. I hope that we can arrive at a satisfactory solution for the long term within, perhaps, a year.
Mr. Millan Mr. Millan rose—
Mr. Taylor: There are only two minutes left.
Mr. Millan: Has the Minister discussed this with the Scottish local education authorities?
Mr. Taylor: I hope that we can arrive at a satisfactory solution. Our aim will be to get it right. In the meantime, these Regulations, unlike the frozen grant Regulations which they replace, will genuinely hold the position, and could do so more or less indefinitely.
We are not introducing a new principle here. We are not taking £1½ million and giving it where it was not given before.
Mr. George Lawson: From what source is the Minister getting advice?
Mr. Taylor: The hon. Member for Motherwell does not understand these things. I challenge him and all his hon. Friends to let us know their views. Our views are clear, and they have been clearly stated. The Opposition want to strangle the grant-aided schools. They are trying, in effect, to create a situation in which freedom of choice is available only for the rich. That is what they stand for.
By these Regulations, we are simply holding the position. The Opposition have behaved scandalously, they have failed to say what their own policy is, and I ask the House to reject the Motion with contempt.
Question put :—
The House divided : Ayes 155, Noes 185.

Division No. 425.]

AYES

[11.30 p.m.

Archer, Peter (Rowley Regis)

Ford, Ben

McCartney, Hugh

Armstrong, Ernest

Forrester, John

McElhone, Frank

Ashton, Joe

Freeson, Reginald

McGuire, Michael

Atkinson, Norman

Garrett, W. E.

Mackenzie, Gregor

Bagier, Gordon A. T.

Gilbert, Dr. John

Maclennan, Robert

Bennett, James (Glasgow, Bridgeton)

Ginsburg, David

McMillan, Tom (Glasgow, C.)

Bishop, E. S.

Gelding, John

McNamara, J. Kevin

Blenkinsop, Arthur

Gourlay, Harry

Mahon, Simon (Bootle)

Boardman, H. (Leigh)

Grant, George (Morpoth)

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

Booth, Albert

Grant, John D. (Islington, E.)

Marsden, F,

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

Hamilton, William (Fife, W.)

Marshall, Dr. Edmund

Brown, Ronald (Shoreditch & F'bury)

Hamling, William

Mason, Rt. Hn. Roy

Buchan, Norman

Hannan, William (G'gow, Maryhill)

Mellish, Rt. Hn. Robert

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

Hardy, Peter

Millan, Bruce

Campbell, I. (Dunbartonshire, W.)

Harper, Joseph

Miller, Dr. M. S.

Cant, R. B.

Harrison, Walter (Wakefield)

Milne, Edward (Blyth)

Carmichael, Neil

Hart, Rt. Hn. Judith

Mitchell, R. C. (S'hampton, Itchen)

Carter, Ray (Birmingham, Northfield)

Healey, Rt. Hn. Denis

Molloy, William

Clark, David (Colne Valley)

Hooson, Emlyn

Morgan, Elystan (Cardiganshire)

Cocks, Michael (Bristol, S.)

Horam, John

Morris, Rt. Hn. John (Aberavon)

Cohen, Stanley

Howell, Denis (Small Heath)

Murray, Ronald King

Concannon, J. D.

Huckfield, Leslie

O'Malley, Brian

Conlan, Bernard

Hughes, Mark (Durham)

Oswald, Thomas

Cox, Thomas (Wandsworth, C.)

Hughes, Robert (Aberdeen, N.)

Owen, Dr. David (Plymouth, Sutton)

Hunter, Adam

Palmer, Arthur

Cunningham, G. (Islington, S. W.)

Irvine, Rt. Hn. Sir Arthur (Edge Hill)

Parry, Robert (Liverpool, Exchange)

Dalyell, Tam

John, Brynmor

Pendry, Tom

Davidson, Arthur

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

Pentland, Norman

Davies, Denzil (Llanelly)

Johnson, Walter (Derby, S.)

Perry, Ernest G.

Davies, G. Elfed (Rhondda, E.)

Johnston, Russell (Inverness)

Prescott, John

Davies, Ifor (Gower)

Jones, Barry (Flint, E.)

Price, William (Rugby)

Davis, Clinton (Hackney, C.)

Jones, Gwynoro (Carmarthen)

Probert, Arthur

Davis, Terry (Bromsgrove)

Jones, T. Alec (Rhondda, W.)

Reed, D. (Sedgefield)

Deakins, Eric

Kaufman, Gerald

Recs, Merlyn (Leeds, S.)

Dempsey, James

Kerr, Russell

Rhodes, Geoffrey

Dormand, J. D.

Kinnock, Neil

Roberts, Albert (Normanton)

Douglas, Dick (Stirlingshire, E.)

Lambie, David

Robertson, John (Paisley)

Duffy, A. E. P.

Lamond, James

Roderick, CaerwynE.(Br'c'n&n'dnor)

Eadie, Alex

Latham, Arthur

Roper, John

Edelman, Maurice

Lawson, George

Ross, Rt. Hn. William (Kilmarnock)

English, Michael

Leadbitter, Ted

Sillars, James

Evans, Fred

Leonard, Dick

Skinner, Dennis

Faulds, Andrew

Lewis, Ron (Carlisle)

Smith, John (Lanarkshire, N.)

Fernyhough, Rt. Hn. E.

Lomas, Kenneth

Spearing, Nigel

Fisher, Mrs. Doris (B'ham, Ladywood)

Loughlin, Charles

Spriggs, Leslie

Fletcher, Ted (Darlington)

Mabon, Dr. J. Dickson

Stallard, A. W.

Foley, Maurice

McBride, Neil

Steel, David

Stoddart, David (Swindon)

Weitzman, David

Wilson, William (Coventry, S.)

Strang, Gavin

Wells, William (Walsall, N.)

Woof, Robert

Taverne Dick

White, James (Glasgow, Pollok)

Thomson, Rt. Hn. G. (Dundee, E.)

Whitehead, Phillip

TELLERS FOR THE AYES :

Urwin, T. W.

Whitlock, William

Mr. James A. Dunn and

Varley, Eric G.

Wilson, Alexander (Hamilton)

Mr. James Hamilton.

Wainwright, Edwin

NOES

Adley, Robert

Green, Alan

Normanton, Tom

Alison, Michael (Barkston Ash)

Grylls, Michael

Nott, John

Allason, James (Hemel Hempstead)

Gummer, Selwyn

Osborn, John

Amery, Rt. Hn. Julian

Hall, Miss Joan (Keighley)

Owen, Idris (Stockport, N.)

Atkins, Humphrey

Hall, John (Wycombe)

Page, Graham (Crosby)

Awdry, Daniel

Hall-Davis, A. G. F.

Page, John (Harrow, W.)

Baker, Kenneth (St. Marylebone)

Harrison, Col. Sir Harwood (Eye)

Parkinson, Cecil (Enfield, W.)

Baker W. H. K. (Banff)

Haselhurst, Alan

Pink, R. Bonner

Benyon, W.

Havers, Michael

Pounder, Rafton

Berry, Hn. Anthony

Hay, John

Powell, Rt. Hn. J. Enoch

Biffen, John

Hayhoe, Barney

Proudfoot, Wilfred

Biggs-Davison, John

Hicks, Robert

Pym, Rt. Hn. Francis

Boardman, Tom (Leicester, S. W.)

Higgins, Terence L.

Redmond, Robert

Boscawen, Robert

Hill, James (Southampton, Test)

Reed, Laurance (Bolton, E.)

Bowden, Andrew

Holland, Philip

Rees, Peter (Dover)

Boyd-Carpenter, Rt. Hn. John

Holt, Miss Mary

Renten, Rt. Hn. Sir David

Bray, Ronald

Hornby, Richard

Rhys Williams, Sir Brandon

Brewis, John

Hornsby-Smith, Rt. Hn. Dame Patricia

Roberts, Michael (Cardiff, N.)

Brinton, Sir Tatton

Howell, David (Guildford)

Rossi, Hugh (Hornsey)

Howell, Ralph (Norfolk, N.)

Russell, Sir Ronald

Brocklebank-Fowler, Christopher

Hunt, John

Scott, Nicholas

Brown, Sir Edward (Bath)

Hutchison, Michael Clark

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

Bruce-Gardyne, J.

James, David

Shelton, William (Clapham)

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

Jenkin, Patrick (Woodford)

Simeons, Charles

Buck, Antony

Kilfedder, James

Skeet, T. H. H.

Burden, F. A.

Kimball, Marcus

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

Butler, Adam (Bosworth)

King, Tom (Bridgwater)

Soref, Harold

Carlisle, Mark

Kinsey, J. R.

Speed, Keith

Channon, Paul

Kitson, Timothy

Spence, John

Chataway, Rt. Hn. Christopher

Knox, David

Sproat, Iain

Churchill, W. S.

Lambton, Antony

Stanbrook, Ivor

Clarke, Kenneth (Ruohcliffe)

Legge-Bourke, Sir Harry

Stodart, Anthony (Edinburgh, W.)

Cooke, Robert

Le Marchant, Spencer

Stoddart-Scott, Col. Sir M.

Coombs, Derek

Longden, Gilbert

Stokes, John

Cooper, A. E.

Luce, R. N.

Sutcliffe, John

Corfield, Rt. Hn. Frederick

MacArthur, Ian

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

Cormack, Patrick

McCrindle, R. A.

Taylor, Frank (Moss Side)

Critchley, Julian

McLaren, Martin

Tebbit, Norman

Crouch, David

McNair-Wilson, Michael

Thomas, John Stradling (Monmouth)

Crowder, F. P.

McNair-Wilson, Patrick (New Forest)

Thomas, Rt. Hn. Peter (Hendon, S.)

Curran, Charles

Madel, David

Trafford, Dr. Anthony

Davies, Rt. Hn. John (Knutsford)

Mather, Carol

Trew, Peter

Dean, Paul

Mawby, Ray

Tugendhat, Christopher

Deedes, Rt. Hn. W. F.

Maxwell-Hyslop, R. J.

Turton, Rt. Hn. Sir Robert

Drayson, G. B.

Meyer, Sir Anthony

Waddington, David

Dykes, Hugh

Mills, Peter (Torrington)

Walder, David (Clitheroe)

Eden, Sir John

Miscampbell, Norman

Walker, Rt. Hn. Peter (Worcester)

Elliot, Capt. Walter (Carshalton)

Mitchell, Lt.-Col. c.(Aberdeenshire, W)

Ward, Dame Irene

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

Mitchell, David (Basingstoke)

Warren, Kenneth

Eyre, Reginald

Moate, Roger

Weatherill, Bernard

Farr, John

Molyneaux, James

Wells, John (Maidstone)

Fenner, Mrs. Peggy

Money, Ernle

Whitelaw, Rt. Hn. William

Fidler, Michael

Monks, Mrs. Connie

Wilkinson, John

Finsberg, Geoffrey (Hampstead)

Monro, Hector

Wolrige-Gordon, Patrick

Fisher, Nigel (Surbiton)

Montgomery, Fergus

Wood, Rt. Hn. Richard

Fookes, Miss Janet

More, Jasper

Woodnutt, Mark

Fortescue, Tim

Morgan, Ceraint (Denbigh)

Worsley, Marcus

Fox, Marcus

Morrison, Charles (Devizes)

Wylie, Rt. Hn. N. R.

Galbraith, Hn. T. G.

Mudd, David

Younger, Hn. George

Gilmour, Ian (Norfolk, C.)

Murton, Oscar

Gilmour, Sir John (Fife, E.)

Nabarro, Sir Gerald

TELLERS FOR THE NOES :

Goodhew, Victor

Neave, Airey

Mr. Waiter Clegg and

Cower, Raymond

Nicholls, Sir Harmar

Mr. Paul Hawkins.

Grant, Anthony (Harrow, C.)

Noble, Rt. Hn. Michael

HOUSING BILL
Considered in Committee [Progress, 9th July].
[Sir Robert Grant-Ferris in the Chair]

HOUSING BILL
  Clause 2

    INCREASE IN FINANCIAL ASSISTANCE
    Amendment proposed : No. 15, in page 2, line 35, to leave out '75' and insert '90'.—[Dr. Dickson Mabon.]
    Question again proposed, That the Amendment be made.
    11.40 p.m.
    Dr. J. Dickson Mabon: I remind hon. Members that with this Amendment we are discussing the following :
    Amendment No. 16, in page 2, line 36, at end insert—
    Section 6(2) (Limit on amount of One half improvement grant payable in advance)
    '75 per cent.'.
    Amendment No. 18, in page 2, line 37, leave out '75' and insert '90'.
    Amendment No. 19, in page 2, line 40, leave out '75' and insert '90'.
    Amendment No. 23, in page 4, line 13, leave out '75' and insert '90'.
    Amendment No. 24, in page 4, line 15, leave out '75' and insert '90'.
    Amendment No. 25, in page 4, line 24, leave out '75' and insert '90'.
    The last three are consequential.
    On Friday, I was in the middle of a most placatory passage asking the Minister to respond to our suggestions and that of his right hon. Friend the Secretary of State for the Environment.
    Today's announcement about housing policy on top of the Bill means that we have much more to debate later with the Housing Bill which is to come next year. We shall be able to take up problems which we cannot remedy now. I am sure that after a rest at the weekend the Minister feels refreshed enough to reply.
    The Minister for Housing and Construction (Mr. Julian Amery): When we concluded our debate in the rising temperature of a Friday afternoon in July, a number of hon. Members wanted me to deal with further matters relating to the Amendment. I will do my best to
    388
    meet their request for additional information as far as I can. I have studied what was said in the debate.
    The purpose of the Amendment is to raise from 75 per cent. to 90 per cent. the amount of Exchequer contribution to the cost of the discretionary grants in the improvement areas. My argument on this similarly applies to later Amendments which will deal with standard and special grants.
    I take it from what the hon. Member for Greenock (Dr. Dickson Mabon) said on Friday that this is essentially a probing Amendment. He asked whether the Government could spend all the money in the time available. I was asked how the estimate of £46 million was reached and how we expected it to be taken up. It may be useful if I explain what the figure—£31 million for England and Wales and £15 million for Scotland—represents.
    It is not an estimate of Government expenditure. The £46 million mentioned in the Financial Memorandum is a forecast—there is a difference between a forecast and an estimate—of what additional capital expenditure might be incurred by local authorities on making capital grants to private owners and by local and other public authorities carrying out improvement works on houses they own. In the words of the Financial Memorandum, the figure is the best estimate that could be made of the effect of the Bill on capital expenditure of the kind I have described, assuming a good response by public authorities and private owners to the increased inducements. We will certainly do our best to encourage a good response, but whether the increase in public capital investment reaches it, or exceeds it, is no more within the direct control of the Government than are many other forecasts of public sector capital investment on other functions discharged not by Government, but by public bodies or private persons.
    We hope that there will be an increase in improvement work to produce that level of additional investment. We shall encourage it in every way we can. We shall be happy if we have underestimated, but we cannot guarantee what the out-turn will be. I repeat, however, that we regard it as additional to the figures for public sector capital investment for housing as a whole contained in

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    the January White Paper. Nor will there be any difficulty if the take-up of grants turns out to be better than estimated and the capital investment figure correspondingly higher.
    11.45 p.m.
    In considering the estimate, I think some misunderstanding may have arisen from a reference early in our debate to the £22 million as expenditure on improvement grants over the whole country in 1970. In fact, in broad terms, the total public capital expenditure of the kind I have described for grant-aided improvement work by all agencies approved in England and Wales in 1970 was about £75 to £80 million and about £13 million in Scotland. I have gone out of my way to describe what the £46 million relates to in terms of capital expenditure by the public authorities, but, of course, there will also be additional expenditure by the Government.
    The Government contributions will increase because the grants on which they are calculated will increase ; because the proportion will increase, and because the local authorities will get higher contributions. Based on the same assumptions as to take-up of the special inducements, the extra Government vote-borne expenditure could amount to about £5 million a year by 1973–74—£3·5 million for England and Wales and £1·5 million for Scotland. That is a continuing annual payment for the period of payment of the contributions.
    It might be useful to set all these figures against a background of progress in 1970. I take up here a point raised by the hon. Member for Willesden, East (Mr. Freeson). In that year, there were about 157,000 approvals in England and Wales. About 42,000—or 27 per cent.—went to local authorities for converting and improving their own properties. About 33,400 were for improvement contributions, which are for conversions and improvements to a comparatively high standard. About 8,500 were for standard contributions to local authorities for providing the basic amenities. Local authorities have also approved about 114,000 grants to private owners—about 54,000 discretionary grants, 60,000 standard grants and 300 special grants. Out of the total of 114,000, over 4,000 were for housing associations.
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    Hon. Members have expressed interest in the breakdown of the private grants between owner-occupied houses and other houses. The answer here is that about 73,300 of the private grants approved in 1970 were for owner-occupiers and about 37,300 for rented houses—about 33 per cent. excluding the housing association houses. In Scotland, grant-aided improvements of 23,400 houses were approved in 1970. Of these, about 17,500 were for improvement of local authority houses, about 5,850 for private owners, and 46 for housing associations. Of the grants to private owners, about 4,300—or 81 per cent.—were for owner-occupied houses. Taking standard grants alone, the proportion of owner occupation was about 89 per cent.
    The hon. Member for Shoreditch and Finsbury (Mr. Ronald Brown) also asked if the increase from 50 per cent. to 75 per cent. was a straightforward financial incentive, and why we had chosen that figure. The answer is that we wanted to encourage more improvement work in the development and intermediate areas over the next two years.
    I can claim no more scientific authority for the 75 per cent. than the noble Lord, Lord Greenwood, could claim for his 50 per cent., introduced in 1969. It has no more special merit than that it is significantly higher than the present figure ; that it reduces the amount the owner has to find out of his own pocket ; but that it leaves him with a reasonable stake in the financing of the work.
    Hon. Members may also have had in mind the question, why not a differential level grant for different categories of applicant? I think the answer to this is simply that we wanted more improvement, and the whole aim of the improvement grant scheme is to improve the condition of the whole housing stock.
    From the beginning of the scheme, through successive Acts by successive Governments, grant has been determined by reference to the same maximum proportion of cost and the same cash limit, whether the house being improved was owner-occupied or rented. Equally, since standard grants were introduced in 1959, the 50 per cent. maximum proportion of cost has applied in all cases. We want more improvement by all agencies and of all categories. We certainly want to see more improvement of rented houses.

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    But we believe that an increase in grant across the board is the answer. We are offering increased inducements to landlords, owner-occupiers and public authorities alike.
    Dr. Dickson Mabon: Does the right hon. Gentleman's remark that he has no scientific evidence one way or the other mean that the Department and the Scottish Office did not carry out any samples of possible repercussions if the grant was raised to our figure instead of the Government's figure? Local authorities behave differently from private individuals and owner-occupiers behave differently from private landlords. If there is no evidence, I rest content ; I am only sorry that there is not. But if there is evidence I should like to know about it.
    Mr. Amery: As much evidence as is available to us in the housing statistics is available to the hon. Gentleman. But in arriving at the figure of 75 per cent., I do not think we had anything more scientific than the hon. Gentleman's right hon. and noble Friend, Lord Greenwood, had when he proclaimed the figure of 50 per cent. in 1969, and that was, after all, a development of housing improvements Acts which were introduced by Mr. Aneurin Bevan as far back as 1949.
    Reference was made by the hon. Member for Shoreditch and Finsbury to the rising costs of improvement and to whether the size of the grant took account of this. He also referred to what he said was an answer to a recent Parliamentary Question to the effect that the cost of building a house had risen in the last 12 months by £1,180 and to the implications of this for the estimated extra public capital expenditure of £46 million, which is, of course, calculated at present prices.
    On the best figures at present available, the average cost of construction of all dwellings in tenders approved for local authorities rose from £3,012 in the last quarter of 1969 to £3,136 in the last quarter of 1970—an increase, not of £1,100, but of £124. However, the grant is calculated as a percentage of the cost of the work, so no problem arises on this point. The amount of the cash limits is relevant but these are to be raised by
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    administrative action by £1,500 and £1,800 respectively. This can be done for particular cases or particular classes of case under Section 5(3) of the 1969 Act. The average discretionary improvement grant for applications approved for private owners during the first quarter of 1971 was only £517 compared with the maximum of £1,000.
    The hon. Member for Shoreditch and Finsbury also raised the question whether the increase in the Government contribution to the costs of environmental improvement in a general improvement area represented an incentive value or a real attempt by me to look at the environmental grant, and he made the valid point that the success of housing improvement policy depends on a successful area improvement policy. He was in fact pressing that the existing limit of £100 a house to expenditure on environmental improvement in a general improvement area on which a Government contribution may be paid should be increased. This raises a much wider general issue.
    We have not attempted in this Bill, limited to development and intermediate areas, to do more than increase the contribution to the costs of environmental improvement in parallel with the increased contribution made towards house improvement. The £100 per house cost limit is not a limit to which local authorities may spend on environmental improvement in a general improvement area ; it is in effect the formula on which the Government contribution is calculated.
    Inquiries made by the Department earlier this year do not suggest that this limit is causing any general hold-up in progress with environmental improvement. But, as the hon. Member for Shoreditch and Finsbury has pointed out, the importance of improving the environment of residential areas is an integral part of Government policy and a close watch is being kept on the point. An increase in this last limit can, if required, be made by the Secretary of State by order.
    The hon. Member for Greenock asked why, if the Government were conducting a publicity campaign about raising grants, they did not have a unit in the Department monitoring the rate at which these applications came in. The Department

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    already keeps track of progress with house improvement through the returns of applications approved and the other statistical material about house improvement grants and contributions provided in returns by local authorities and published regularly in summary form in the housing statistics.
    I shall seek to obtain separate returns from the local authorities to which the Bill applies in respect of the higher rates of grants. It is not claimed that these will show precisely the take-up, for reasons which I tried to explain at our last Sitting. They are, for example, based on numbers of applications approved and take no account of applications which are not proceeded with. But they will provide a reasonably good indication of what is happening, sufficient certainly to gauge whether the take-up in these areas has been materially increased following the provision of higher grants.
    I do not know whether I have been able in these few words to answer all the points raised by hon. Gentlemen opposite on the last occasion, but I have done my best to clarify those points which I could.
    Mr. Reginald Freeson: We appreciate the effort which has been put in by the Minister and his Department during the time lapse since our last debate in obtaining information in answer to points which were raised. There are one or two matters outstanding which I will put to the Minister to see whether it is yet possible to get the information we seek.
    Before doing so, I make the general observation that the tone in which the Minister has referred to this general figure of £46 million forecast expenditure is somewhat different from the manner in which the whole issue was presented to the public and to the Press a few weeks ago, when Press correspondents were told that the Government were giving an extra £46 million to the development of the intermediate areas. A different tone has crept in this evening, and it now becomes a question of expressing hope rather than estimating what the Government will be spending.
    The Minister has referred to the £46 million as the most accurate estimate the Government can make of the rise in
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    Government expenditure as a result of the Bill. Will this be entirely Government expenditure, or will part of the £46 million be attributable to rate expenditure by local authorities? If so, what is that figure? There has been sufficient warning of this question. I have, I think, put it in Committee but, if not, I certainly put it on Second Reading.
    I ask again a question I put on Second Reading and repeated last Friday. What is the current expenditure prior to the Bill becoming operative? When the 1969 Bill was going through Parliament the Financial Memorandum forecast that the annual public expenditure arising from that Bill would approach £40 million by 1972. We are half-way to 1972 now, and we should like to know whether this is still a realistic figure to which this £46 million spread over three years is to be added as the most accurate forecast that can be made, or is there a different figure? To what is the £46 million extra? This information is necessary if we are to be able fully to follow the effectiveness of the improvements policy. The Government have not so far published information on this matter and we are entitled to know.
    12 midnight
    My researches in the Library and elsewhere show that in 1971 the figure is expected to run at about £22 million, which is a good deal lower than the original £40 million forecast in 1969. Is this figure correct? Again we should know the answer to this question because this is the base on which the Bill is to operate.
    It is important when examining these large amounts of public expenditure to try to get clearly in mind in what way this sum is extra to existing forecast expenditure generally on housing, because improvements are only one element in the public expenditure figure. In January the White Paper forecast public expenditure on housing in all its various forms to be £1,144.4 million. That figure was not broken down into its various elements. May we be told whether current expenditure is running on this pattern, or are there any indications of a fall-back? Will we be current spending at the rate of £1,144.4 million in 1971, or will we be under-spending in the public sector of housing? Is the £46 million spread out over three years additional

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    to the £1,144.4 million, or is it part of that figure within the original ceiling?
    The Minister has said that in terms of forecasting there will be no difficulty about the share of £46 million being in addition to the January figure. But that is not the answer to my question. That only tells us what could be the position. We want to know the actual position. We do not ask this only out of idle curiosity. This question is fundamental to the whole sphere of housing policy in the public sector. It bears on whether that policy is operating effectively and whether the take-up is as planned by the Government.
    The Minister touched on the question of the general expenditure limits for grant purposes, and he said that there was no evidence that the present limits in the 1969 Act held back expenditure on improvements. He quoted an average figure of £500 on the basis of experience gained, but I do not accept an average figure of that sort as an answer to the main point. The main point is that, if the Act envisages applicants being entitled to a certain level of assistance in real terms, then from time to time we should look at the effectiveness of the figures in the Act to see whether people are benefiting as Parliament intended.
    The Minister referred to rising costs. I did not understand the figures which he gave, because they did not seem to tie up with the figures which we are receiving from the National Federation of Building Trades Employers and the Building Materials Producers' Council. They give different figures of rising costs month by month which do not tie up with the Minister's figures.
    It is clear that there is a sharp rise in costs, which means that there is a drop in real terms in the value of the grant limits. The question is not whether a person who applies for only £500 or so can come well within the Act and not suffer from it, but whether a person who wished to apply for something at the lop level is, as it were, being squeezed because of the drop in real value of the grants in the Act.
    We shall inevitably come back to that point later, but I hope that, in the light of the answers which we had to a whole series of points which were raised on Friday, the Minister will answer these
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    points, which are of central importance to our understanding of what is going on in housing in the public sector. If further time is required while inevitably information passes between the Box and the Front Bench, so be it ; but at some stage tonight—preferably now—these specific points of information on the projected financial take-up should be given to the House.
    The Under-Secretary of State for the Environment (Mr. Paul Channon): I will attempt to answer some of the questions raised by the hon. Member for Willesden, East (Mr. Freeson). If I do not answer all of them, perhaps he will remind me of any particular point and I will endeavour to answer it. If I cannot supply the answer straight away, I shall have a further opportunity on the Question, That Clause 2 stand part of the Bill.
    I will take the last point first which concerned the general limits. The short answer—we shall have a further opportunity to debate the matter when we come to the relevant Amendments—is that a general power to raise the limits exists in the Housing Act, 1969. If there were sufficient evidence, my right hon. Friend would have no hesitation in raising the top limit of grant ; but, as he endeavoured to show earlier, so far there is no evidence that a general increase is necessary and there is no evidence that improvements are being held up because the top level of grant is too low. Should such general evidence be produced, powers exist which enable my right hon. Friend to raise the limit, and in such circumstances he certainly would do so. However, there is no general evidence that that is necessary.
    The hon. Member for Willesden, East may be able to produce isolated examples I know of very few. However, if he has any evidence that the general limits are too low, we should be delighted to consider it not only during the passage of the Bill, but at any later date.
    Mr. Freeson: Perhaps I might raise two points. First, we are not concerned with the immediate past or the current position, but with projecting forward. We should learn from experience. There is clear evidence of sharply rising costs and that they are likely to continue.

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    Secondly, the hon. Gentleman repeated what his right hon. Friend said about the existence of a general power to increase the grant levels. This is not so, as we shall show when we come to new Clause 2. I must place on record that the Minister, no doubt unintentionally, misstated the position. There is no general power.
    Mr. Channon: My right hon. Friend will seek to answer the hon. Gentleman when we come to new Clause 2 and show that there is such a general power. I suspect that I shall be out of order if I try to develop that now. I assert that there is such a general power, but perhaps the hon. Gentleman will be able to convince my right hon. Friend that it does not exist. We believe that it does, and my right hon. Friend will seek to show how it is applied.
    Perhaps for the purposes of the Amendment the hon. Gentleman will accept for the time being that I am right in saying that such a power exists, and that my right hon. Friend would have no hesitation in raising the limit if there were any evidence that it was proving a handicap. The hon. Gentleman does not think that such a power exists. Perhaps I could leave the question whether it does until we come to new Clause 2, and invite the hon. Gentleman to look at Sections 5(3) and 37(5) of the 1969 Act.
    On the question of the £46 million, my right hon. Friend has tried to show that this is the most accurate forecast that we can make, but it is a forecast rather than an estimate. The Explanatory and Financial Memorandum says :
    "On the best estimate that can be made, the Bill will result in increased public capital expenditure … of the order of £46 million …"
    My right hon. Friend was careful during the Second Reading debate to make it clear that this was the best estimate that could be made. It may turn out to be an under-estimate. I hope, as I am sure the House does, that it will. It may be an over-estimate, but I hope that that will not be the case.
    The sum of £46 million represents capital grants by local authorities to owners and expenditure by local authorities on improving their own houses. It is impossible to be precise about what proportion of the £46 million will come out of the rates, and what proportion out of Exchequer expenditure, but it will
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    inevitably be a comparatively small proportion that is borne by anything other than Exchequer expenditure, because under the Bill 7½ per cent. of the grants to owner-occupiers will be borne by local authorities, and 25 per cent. of the work in their own houses, and the remainder will be borne by the Exchequer.
    I shall attempt to show what proportion of the £46 million will be spent by local authorities on their own houses as opposed to the forecast of expenditure on owner-occupiers, or rented accommodation. We can try to break it down further, but whether it will have much meaning, or be more than an informed guess, I do not know. It is a small proportion that is borne out of the rate-borne expenditure rather than the Exchequer burden, because it is 7½ per cent. of that grant, and 25 per cent. of the work on their own houses.
    The hon. Gentleman also raised, very correctly, as he did on Second Reading, the question of the whole expenditure on housing, and whether this was a substitute for, or an addition to, an existing figure. He asked how this extra £46 million was arrived at. I repeat the assurance that I gave on Second Reading, and I hope that I can satisfy the hon. Gentleman, that this is an extra amount. This figure of £46 million over this period is the extra amount that will be spent, if we can arrive at that figure. Nothing is taken out of the Housing Estimates to make up for this extra £46 million. There is no cut-back, if I dare to be controversial, in local authority mortgages. There is no cut-back of any other housing expenditure to make room for this figure of £46 million which it is our hope will be spent during this period.
    This is extra expenditure.
    12.15 a.m.
    Mr. Freeson: I was choosing my words carefully. The point that the hon. Gentleman makes is that there has been no cut-back and that implies a Government decision. This was not what I was asking. I was asking whether, not because of a Government decision, but because of the operation of the policy generally in the country, there was an under-spending indicated on current estimates for 1971–72. I do not say that it is because of a decision to cut hack but is it the case that the original figure

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    of £1,144·4 million shows an indication of being taken up during the course of the year?
    Mr. Channon: I would like to be able to give the hon. Member a conclusive answer, but I do not think that I can because it is too early to tell. The short answer is that, whether or not there is an under-spending and I have no evidence to assume that there will be—I hesitate to say either way at this point—it is irrelevant to the decision to introduce the Bill. It is not because we believe that there will be an under-spending on housing expenditure that we suddenly thought "Let us see what we can pop in."
    That is not what happened. There may be an over or under-spending or we may have it right. At the moment we see no reason to assume that there will be an over-spending or anything else. I assure the hon. Member that this is a genuine extra sum, to be added to the estimates made by my right hon. Friend.
    Since the hon. Member raised the point on Second Reading I have been advised that what I told him then is in accordance with the practice of both governments. They have not broken down expenditure in the way the hon. Member would like me to do. I am tempted to do so, but I am advised that this is the practice followed by all previous Governments. It would be extremely rash of me to try to break this practice.
    [Mr. BREWIS in the Chair]
    Mr. Freeson: I assure the hon. Gentleman that I would not consider it rash of him. I am not making a party point on this. If I may be a little rash, when I was in the position now held by the minister I held the view—maybe I had false hopes—that we should try to give a more accurate breakdown of figures of this kind within and outside the Department. May I urge the hon. Gentleman not to accept the present position just because it has always been the practice.
    No doubt there will be other opportunities to return to this, but I believe that this question of providing more accurate figures, of monitoring perhaps, is of central importance to the future evolution of housing policy. Perhaps Governments have been wrong in the past in giving these generalised figures. There is even
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    less excuse today because there has been a build-up over recent years of statistical monitoring. With modern methods there is less reason for continuing the practice of putting out this type of figure. The figure which appeared in the White Paper—and I say the same thing of previous Governments—in terms of comparing the operation of one housing policy with another is meaningless.
    The Temporary Chairman (Mr. John Brewis): We must come to a decision on this Amendment.
    Mr. Channon: The hon. Gentleman will appreciate that I am not in a position to answer the latter point.
    The Financial Memorandum to the Housing Act, 1969, made a forecast for increased expenditure of about £40 million. In the event, the figure for last year turned out to be between £75 million and £80 million. I will give an approximate breakdown, but I trust that the Committee will forgive me if my statistics are not accurate. About £11.9 million was paid out in 1970 in discretionary grants to private owners, £7 million by way of standard grants, and a further £50 million was spent by local authorities on their own properties. A sum was also provided for housing associations. This amounted to about £75 million in all.
    It is difficult to differentiate in a debate such as this between some of the items ; for example, between grants paid to owners and sums spent by local authorities on their own properties. I only hope that I have not made matters more complicated by giving this rough breakdown. If I have confused the issue or if I am wrong, I will take the opportunity later of correcting the figures.
    Having given this explanation, I hope that hon. Gentlemen opposite will not press the Amendment. We have a number of interesting aspects of the subject to debate on later Amendments, when we will do our best to give further information.
    Mr. Ronald Brown: I am grateful to the Minister for the courteous way in which he has dealt with the points I raised last Friday. However, I have been searching in the Library to find a figure which corresponds to the one he has given for

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    increased house-building costs, and I cannot find such a figure.
    He said that the cost yardstick was increasing annually by between 7 per cent. and 12 per cent. If that is the position, then the point I raised on Friday is relevant. Is there an element within the sum of £46 million which reflects this annual increase? If the yardstick is increasing by the amount he said, then there must be corresponding increases in the grant to cover it. I hope the Minister will bear in mind the need for the grant to reflect inflationary increases in the cost of repairs. Does the sum of £46 million reflect these increases?
    Mr. Amery: I wish it were possible to forecast as accurately as the hon. Gentleman asks. I do not believe that the forecast of £46 million is accurate enough to take into account the kind of considerations he has raised.
    Dr. Dickson Mabon: We are pleased with the amount of information we have been given, which it is not possible for us to digest without studying it in HANSARD.
    It might be helpful if I were to indicate how we propose to discuss later issues. We do not intend to debate later Amendments dealing with the replacement of 75 per cent. by 90 per cent. We are taking this view to facilitate the progress of the Committee. We will listen to the case that is made in relation to Amendment No. 16 and we will probably wish to debate Amendment No. 17 and Clauses 2 and 3 stand part. This will enable my hon. Friends to raise a number of points without moving what I might call fractional Amendments which probe why one figure is designed to replace another.
    Having said that, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. Channon: I beg to move, Amendment No. 16 in page 2, line 36, at end insert :

    Section 6(2) (Limit on amount of improvement grant payable in advance)

    One half

    '75 per cent'.

    Section 6(1) of the Housing Act, 1969, allows an improvement grant to be paid
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    in instalments as the works progress. The balance would then be paid on the completion of the works. Where a grant is paid by instalments, Section 6(2) of that Act provides that at no time may the aggregate of the instalments
    "… exeed one half of the aggregate cost of the works executed up to that time."
    I apologise to the Committee that the Amendment should be necessary. This should have been in the original Bill. The effect of the Amendment is to increase this limit from 50 per cent. to 75 per cent. of the total cost of the improvement works so far carried out. This means that the advance payments that may be made will reflect the increase in the proportion of improvement grant, from 50 per cent. to 75 per cent. of the approved cost, proposed in the Bill.
    The Amendment will bring the provisions in the Bill relating to England and Wales into line with those already contained in Clause 3(1) in relation to Scotland. The authority is not obliged to pay by instalments, and if it decides to pay by instalments it will not be obliged to pay as much as three quarters. Indeed, perhaps towards the end of the period, it will be cautious about going so high. All that the Amendment does is to give it the power to go up to three-quarters to pay by instalment, if it wishes.
    As the maximum grant is now three quarters, and as a number, but not an enormous number, pay by instalments, it seems only reasonable, if they wish, that they should have the power to pay by instalments up to 75 per cent. This is a very small point and I hope that the Committee will feel able to agree with it.
    Amendment agreed to.
    Mr. Freeson: I beg to move, Amendment No. 17, in page 2, line 36, at end insert :
    Section 5(2)(a) (Limit on improvement grant) £1,000 £1,250.
    Section 5(2)(b) (Limit on improvement grant) £1,200 £1,500.
    The general point of the Amendment is in pursuit of the observation made by a number of hon. Members in Committee and on Second Reading, and in pursuit of the point I made a few minutes ago, that account must be taken of rising costs in the projected operation of the Bill when it becomes an Act. It is not sufficient to

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    take the present situation and say that it is satisfactory and leave it at that.
    There is no quarrel about the improvements in percentage contribution which the Bill has at its heart. This has been quite clear during the proceedings. The effect of the Amendment would be that the increased percentage contributions which the Bill already proposes will be on a larger ceiling, should this ceiling be reached. In other words, whereas now there is an increase of up 75 per cent. contribution on a total expenditure of £2,000, instead of the present £1,000, or 50 per cent. of that £2,000 as a ceiling, to take the more general case in the first line of the Amendment, if the figure goes to £1,250, it is on the basis that the top expenditure for grant calculation purposes becomes £2,500, and not £2,000, and the 75 per cent., as proposed in the Bill, will be 75 per cent. of that.
    I have not worked out exact fractions here, but this is based broadly, first, upon the rising costs of building works and materials which we have already experienced since the 1969 Act became operative and which are currently rising at an even sharper rate, and it also allows for the fact that there will be a continuation of this rise, although at this stage we do not know for how long it will continue at the present very sharp rate of increase.
    As I indicated earlier—although it did not seem to tally with what the Minister indicated on the rising costs of completed houses—the building trades employers and the B.M.P.C., in the information which they circulate publicly and to members specifically, and no doubt to the Department, have indicated that costs are rising at a rate of about 1 per cent. per month or about 15 per cent. over the year. I believe that it is about 15 per cent. in the London area and in the South-East, and the industry calculates that it is rising by 12 per cent. annually.
    12.30 a.m.
    If this considerable rate of interest continues over the coming year—there is little indication of a slow-down in the rate of increase—we shall shortly reach a position where the real value of the grant ceilings prescribed in the 1969 Act will be about £80. If the rise in costs of building and building materials continues beyond the next 12 months at
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    about the present level, there will be an even further depreciation in the value in real terms of the figures in the 1969 Act.
    I appreciate the Minister's point that Section 5 of the 1969 Act empowers the Minister, on representations from local authorities, to agree to a higher ceiling in individual cases or in certain classes of case, but that is not the point. The Act deals with a general proposition for ceilings on grant aid, whether it be in terms of £1,000 or in terms of conversions. The fact that individual local authorities may give specific evidence in particular cases or groups of cases that there are difficulties which they have encountered or which housing associations have encountered or which private landlords have encountered does not meet the point
    My point is that for the general run of people making use of this Act costs are rising so sharply currently and as projected into the next year or so that the real value is falling. That was not the intention of the Act. I accept that when the 1969 Bill was presented and the figures were looked into by the Department a factor was probably built into the figure, though it has never been clear to me what that figure was. I do not recall that on Second Reading or during the Committee proceedings on the 1969 Bill a specific figure was quoted as being the element that had been built into the figures to allow for a recognised rise in cost for a given number of years. It is certain that since the passage of that Act, in the past year or so and as currently projected the increase in costs in building has been so much sharper than it was at the time that the Bill was being prepared that we must now take account of it. The Act could not have foreseen a rise in costs of 12 per cent. to 15 per cent. annually.
    These are the reasons why, if we are to operate the original Act and the amending Bill in the true spirit of the Act and of the Bill, we should seek to bring the figures in the Act and, by implication, those in the Bill into line with real values. Where £1,000 has become £800, we must ensure that the original value is re-established, and the only way to do that, as a general proposition, so that all people may have fair treatment, is to ensure that we increase the

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    figure in the Act by means of Amendment to the Bill to allow for it.
    Hence the proposition that the £1,000 and the £1,250 should rise to £1,250 and £1,500. The due percentage contributions which the Bill proposes in general should thereby be increased in current cash terms to match the real objectives in cash terms intended under the 1969 Act, which it is the duty of all those who are interested in this aspect of housing policy to continue over an indefinite period ahead.
    Mr. Channon: I congratulate the hon. Member for Willesden, East (Mr. Freeson) on raising this interesting point, which, I think, is well worthy of consideration by the Committee. I confess to having been slightly mystified initially as to the precise purpose of the Amendment, for reasons to which I shall come in a moment. I was interested in the figures which the hon. Gentleman had taken in the Amendment. He seeks to insert in Clause 2 further amendments to Section 5 of the Housing Act, 1969.
    Originally. I thought that the hon. Gentleman had found an ingenious way of raising the point, which is perfectly accurate, that Section 5 of the 1969 Act limits local authorities, under subsection (1)(a), to one-half of the approved expense of the works or £1,000. Therefore, were we to increase the £1,000 to £1,500 for the ordinary improvement grant, the hon. Gentleman had it in mind, I thought, that we should amend Section 5(2) also in order to put that figure up to £1,500, since otherwise, although one would not have been caught by the one-half any more, one would be caught by the monetary limit, which would not be the 75 per cent. allowed under the Bill.
    I hope that I can now meet the actual point which the hon. Gentleman has raised. Section 5(3) provides that the Minister may fix a higher amount with respect to a particular case—I agree that that would not be suitable in relation to this Bill and the generality of cases—and also, which is the important point, he is entitled to fix a higher amount with respect to a class of case.
    My right hon. Friend has it in mind, if the Bill becomes law, as, I think, the whole House hopes it will, to approve higher limits for a particular class of case to which the Bill applies, that is,
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    for improvement grants in the development and intermediate areas. He will make these limits £1,500 and £1,800 in order to meet the point I have made about the 75 per cent. as opposed to the 50 per cent. in the past. Obviously, the £1,500 is 75 per cent. of the ordinary improvement grant and £1,800 is 75 per cent. of the special grant, as the hon. Gentleman will have seen. The 1969 Act gives power to do that by administrative action. Such an approval will be included in the circular to be sent to local authorities after the Bill has been passed. I am glad to have had a chance to make that clear, because some local authorities or others interested in the Bill may wonder whether Section 5(2) imposes a limit that we had not intended.
    The hon. Gentleman based his argument largely on the question of rising costs. I see his point, that if costs rise the whole time the real value of the improvement grants will be eroded. Such rising costs, if they continue, are likely to be countrywide and not limited to development or intermediate areas. If it proves necessary to increase the general limits for improvement grants because costs go on rising, that can and will be done by Order. The Committee will agree that such an Order should apply to the country as a whole, and therefore would not be particularly relevant to the Bill. If there were to be a general Order for the whole country, the extra amounts given to development and intermediate areas could be included under the Clause, where specific power is taken to show that where more money is given to the country as a whole the differential to development and intermediate areas can be preserved. So the power to do what the hon. Gentleman would like us to do already exists. My right hon. Friend will have a chance to show him in great detail exactly how it exists under various Sections of the 1969 Act when we come to new Clause 2. As that power exists, the Amendment is unnecessary for that purpose.
    The limit imposed by Section 5(2) of the 1969 Act can be raised, as is clearly set out in Section 5(3). My right hon. Friend has it in mind to go further to meet the requirements of the Bill, from £1,000 to £1,500 for improvement grants and for special grants from £1,200 to £1,800.

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    I hope that that explanation will satisfy the hon. Gentleman. He has raised a very real point about the need to keep improvement grants up with rising costs, should they go on rising. There is no evidence that there is any need to increase them now ; there is no evidence that they are biting at the top level. Should they do so, my right hon. Friend has the power that the hon. Gentleman seeks in the Amendment. We shall bear in mind what the hon. Gentleman said, and I hope that he will feel it unnecessary to press the Amendment.
    Mr. Freeson: I do not intend to press the Amendment, but the matter should be kept very much alive in the Department and before the House. It is very difficult to establish clearly when there is firm evidence that because of rising costs or a reduction in the value of the pound a direct impact is being felt on improvements policy. There are so many factors. Between 1949 and 1969, with the introduction of standard improvement grants in the middle 1950s, which was only a marginal contribution to the solution of a big problem, there was no change in the figures for improvement under the 1949 Act.
    12.45 a.m.
    One of the reasons for the loss of impact of the improvements policy was that Parliament had been content to allow the figure to remain, although it had long since lost its value, had been halved or even worse. It is important not to allow long gaps to occur, not gaps of 20 years, but not even of two, or three, or five years. This is something which must be constantly watched to ensure that the Act builds up a modest impetus. The only way to do that is to accept the purpose of the legislation and to ensure that the purpose is maintained.
    I do not fully accept what the hon. Gentleman says, but I shall not press the Amendment. When I say that I do not fully accept what he says, I mean that it is not sufficient to wait to see what effect a reduction in the value of the pound will have on improvements policy. It must be having an effect now. If £1,000 of two years ago is now worth only £800, there is an effect on every owner-occupier and local authority wishing to undertake this work. We need
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    not go through a sophisticated exercise to reach that conclusion.
    Mr. Channon: I may have misled the hon. Gentleman at one point. I think that I referred to a special improvement grant. The sum of £1,200 is, of course, for the conversion of houses ; that is not a special improvement grant.
    Mr. Freeson: I had noted that and assumed it to be a slip of the tongue.
    We need not undertake a sophisticated exercise to see the impact of rising costs. Action needs to be prompt when the value of money is falling as it is. If our suggestion is not accepted tonight, I hope that the matter will come before the Ministry and before Parliament again within the coming year. I do not expect an undertaking now, but we shall un-doutedly be returning to this subject.
    [Mr. ARTHUR PROBERT in the Chair]
    Mr. Ronald Brown: I listened intently to the Under-Secretary and I am still not satisfied that the point we have been making has been taken. Under the provisions of the Housing Act, 1969, many items may be included in the cost of the work, including survey and legal fees. That element of the cost alone has risen and the White Paper published today recognises the rise to such an extent that a special subsidy is suggested to meet it.
    The Under-Secretary is under-estimating the increase in costs. Local authority personnel tell me that by the time they have fixed the cost of a contract and got agreement about the amount of work to be done within the two-year period, especially when additional work such as dealing with dry rot is found to be necessary, costs have risen above the original figure. I am still not satisfied, incidentally, that the Minister has agreed that when additional work is found to be necessary, for instance, during a conversion, the extra work will rank for grant to meet rising costs.
    Mr. Channon: I will take careful note of all the points made by the hon. Member for Shoreditch and Finsbury (Mr. Ronald Brown). My right hon. Friend has often made it clear that we shall keep the closest watch on the limits of the system, and if there is evidence that they are proving too low, he will not hesitate to raise them.
    Mr. Freeson: That is not the point.
    Mr. Channon: I thought that it was ; I am sorry if I have misunderstood.
    Mr. Freeson: Semantics are important in this. The Under-Secretary keeps saying that if there is evidence to show that the rising cost is having an impact on the level of house improvements, the Minister will take action immediately. That does not mean very much. There is no need for further evidence than that the £ is worth only 90p after one year and that it will fall to 80p in real terms at the end of another year. Translate that into the Bill and we know that people will get less done for their money and less done within the grant ceilings.
    We do not need to wait for the evidence that, instead of 156,000 improvement grants rising to a projected 170,000, they have risen to only 165,000 or 167,000, to take action on rising costs. There is a real and sharp difference in costs, not just a marginal one. All the evidence is that this will continue for some time and that in itself is evidence enough for the Government to act, if not tonight then within a very short time.
    Mr. Channon: I see the point. It was hoped that the £1,000 figure fixed in 1969 would last for some time and that it was a generous sum. It probably was generous. But there is no evidence that the difference in the value of money is having any deleterious effect on the improvement grant scheme.
    We will keep the figures up to date and if necessary we will increase the improvement grants. My right hon. Friend has shown that he is extremely anxious to keep up the impetus of improvement grants. The figures have been extremely good and we hope this will continue because the grants meet a social and economic need.
    I hope hon. Members will not have to chide us for not having lived up to our responsibilities. We shall keep the limits and the working of the scheme carefully, urgently and constantly under consideration. I cannot go any further than that but I welcome the debate because it shows how important this matter is and the keen interest that all hon. Members have shown in keeping up the momentum of the scheme. We shall do all we can to maintain that momentum.
    Mr. Freeson: Whatever the differences of emphasis, sharp or otherwise, that there
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    may have been on this point, I accept that the Minister has gone as far as he can in the assurances he has given about the general intentions. As I have given for our part an undertaking that we propose to return to this as the opportunity arises, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    The Temporary Chairman (Mr. Probert): I understand that the hon. Member for Willesden, East (Mr. Free-son is not proceeding with Amendment No. 18, in page 2, line 37, leave out '75' and insert '90', and Amendment No. 19, in line 40, leave out '75' and insert '90'.—both standing in his name and the name of the hon. Member for Greenock (Dr. Dickson Mabon).
    Mr. Freeson: That is so, Mr. Probert, for reasons which my hon. Friend mentioned earlier.
    Mr. Frank Allaun: I beg to move Amendment No. 21, in page 3, line 41, at end insert :
    (3A) Where assistance has been given to a private landlord by the making of a grant specified in this section, the rent officer in determining what rent is or would be a fair rent shall have regard to the fact that the increase in the value of the property has resulted primarily from the use of public funds and not from the funds of the landlord.
    Hon. Members from constituencies all over the country are being approached by tenants in great trouble—tenants whose rents are being trebled or more because they possess a bathroom or because one is being installed. This results from the 1969 Act. I remind the Committee that several of us voted against the appropriate Clause in the Standing Committee which considered that Measure because we foresaw precisely what would happen.
    These tenants dearly want a bathroom, lavatory and hot water but they cannot afford such a drastic increase in their rent to pay for them. Therefore, they are now attempting to resist these improvements, but they cannot resist them because, under the Act, they can be compelled to have them done and their rents increased. There are exceptions for people on such low incomes that they are to get these improvements on supplementary benefit and those under £10 a week income or £12·25p if married.

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    I am afraid that this situation will lead—and I am as concerned as anyone about improvements—to a widespread tenants' resistence movement, which is the last thing we want to see. Under this Bill, landlords are being give a fourfold bonanza. First, they already get a grant of 50 per cent. of the cost of improving their houses under the 1969 Act ; secondly, they get a greatly increased value on their property in consequence ; thirdly and most profitable of all, they are allowed to take their houses out of the present rent control, which roughly increases rents 2.6 times—these are Ministry figures—even before the added improvement is allowed for in the form of the further increases ; fourthly, now the grant is to be raised to 75 per cent.
    The landlords are going to enjoy this bonanza. What about the tenants? Have they no rights, except the right to have their rents sharply increased? Surely it is reasonable that, if the landlord is to be so greatly helped out of public funds, the tenant should not be forced to pay for it, or not to this extent. It may be argued that this is not the case, since it is the taxpayers who stand 75 per cent. of the cost. If the tenant's rent remained the same, that would be so, but it will not. It will be increased, not 2.6 times, but between 3.6 and 4 times in many cases. Therefore, my hon. Friends and I urge that the very least protection should be that the rent officer and the rent assessment committee be required to consider the hand-out from public funds to the landlord when fixing the new rent.
    1.0 a.m.
    If bribing the landlords brought results, it might be acceptable ; but when accompanied by a penalty for the tenant it is insupportable. I am reported last Friday as having said that I opposed "driving" landlords to improve houses. I assure hon. Members that that is not my position. What I said was that I was opposed to "bribing" landlords to improve houses, which is very different. However, it is too late to make a correction.
    I can take hon. Members to a row of houses in Salford—"Coronation Street" land—which, before the 1969 Act, had been greatly improved. They have had
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    a bedroom or half a bedroom converted into a bathroom. It cost the tenants 8s. a week extra. They are delighted. It has turned their houses into what they call little palaces. I do not suggest that the landlord made a fortune out of this ; but he is not a philanthropist. He covered his cost with the aid of the grant, which at that time was 12½ per cent. of his share of the cost, and he did it for 8s. a week. He did not lose on it, or he would not have done it. Now I must go to the tenants and say, "Sorry, gentlemen, your rent is not going up by 8s. a week ; it will be trebled or quadrupled". What will they think of their Member of Parliament or other Members of Parliament who will have put him in that position? Now the grant is to be increased from 50 to 75 per cent. It is therefore even more imperative that tenants be protected. Without this Amendmentment, unfortunately, the improvements campaign will encounter very serious obstacles.
    If the so-called fair rents system were working equitably, I might feel less strongly than I do on this issue. But it is not. The average controlled rent is multiplied 2·6 times when it comes out of control, and this has a great bearing on another Bill referred to earlier today. When it comes out of control and into regulation through the rent fixing machinery, this is the average increase : a rent of £2 a week plus rates becomes £5 4s. plus rates. But in certain areas, such as London, the percentage increase is far higher. In addition, where a bathroom is installed, the rent officer naturally says that the value of the house has increased and adds yet again to the rent.
    I assure hon. Members that discontent is boiling over in London about rents. Last week, in a crowded room in the House, spokesmen for tenants' associations from all over London representing the thousands of people concerned met to consider what is happening. They reported how big property companies are increasing rents drastically every three years ; that the scarcity factor which accounts for high rents and which the Act says is to be ignored is clearly not being ignored ; how some rent officers are fixing widely different rents for identical flats in the same block ; how highly paid lawyers whom the tenants cannot afford are being employed for the big property companies ; of illegal

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    premiums of £1,000 being required of incoming tenants ; of tenants being forced out to provide flats for wealthy tourists ; of many rent assessment committee members being heavily biased in favour of high property values—I am thinking of chartered surveyors, lawyers, and so on ; and regulated tenants paying more than unregulated tenants.
    The tenants are meeting again this week or next week, and a dossier will be presented to the Minister of the things that are taking place under the Rent Act which are completely contrary to what most of us believed were the objectives of that Act.
    Mr. Frank McElhone: I should be failing in my duty if I did not support my hon. Friend (he Member for Salford, East (Mr. Frank Allaun). On 14th January, 1968, there was a terrible storm in Glasgow. As a result of my right hon. Friend the then Secretary of State in the Labour Government taking the initiative, Glasgow received £6 million for the renovation of thousands of tenements which had been neglected for generations by the property owners. That situation is now being exploited.
    Now that rents have been decontrolled, I know from the experience of my Saturday surgery, that factors and property owners are increasing rents at a tremendous rate. The weakness of the Rent Act is that no general principles are laid down for the guidance of rent officers. Differing rent assessments are made of similar houses in the same street, and I am at a loss to understand how the assessments are made. Perhaps they are made on a rule-of-thumb basis.
    Now that these houses have been decontrolled, real hardship is being suffered. There must be a rethinking of the whole system of fair rents, fair rent officers and the method of arbitration. It would be entirely wrong for us to give out public money as a bonanza to property owners who have for generations neglected their property.
    The cry of property owners is that the high cost of repairs has prevented them from maintaining their property. In my constituency, because of a grievous housing shortage, individual flats in tenement buildings have been sold. It is no exaggeration to say that there are few
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    tenement buildings in which two or three or perhaps more flats have not been sold at grossly inflated prices. Many houses do not have an inside toilet or even a bath. The profits from the sale of these tenement flats are often three times as much as the landlord paid for the whole property.
    Mr. Robert Hughes: I wish to emphasise what was said by my hon. Friend the Member for Glasgow, Gorbals (Mr. McElhone) about the general state of tenanted properties in Scotland. In the past landlords have been extremely reluctant to carry out repairs, modernisation and improvement of the properties they own. The excuse that is often trotted out for not ploughing back profits into these properties is the low level of rents prevailing generally in Scotland. This is only an excuse, because the general tendency of landlords has been to make a "fast buck" when the going is good and to let the property run down. If this were not the case, we would not have needed a number of Housing Acts over many years to try to get landlords to carry out some repairs.
    We have seen a number of Acts since the war. The 1957 Housing Act led to considerable decontrol of housing tenancies, and allowed landlords to increase rents if they spent a certain amount of money on the property. My evidence is that that Act did not lead to any great improvement in housing. All that happened was that wherever possible tenants were forced out to make room for uncontrolled tenancies. Many people have come to see me over the years and have told me that they have been offered a three-bedroom flat on a different floor in place of a two-bedroom flat in which they have been living only to find that the flat into which they have moved is decontrolled and that they have no protection under the Housing Acts.
    There is no evidence that the 1957 Housing Act led to any increase in the number of improvements carried out by landlords. In this Bill we see another attempt to encourage landlords to undertake improvements, and any improvements will be welcomed, but the result is bound to be that rents are likely to rise.
    The problem is that we are not dealing with this Bill in isolation. It is to be seen against the background of the White

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    Paper which was presented today and which seeks to extend rent rebates to private tenants. The result will be an upward spiral in the general level of rents. We have this whole bonanza of landlords being able to get more for properties which they have neglected in the past.
    As my hon. Friend the Member for Salford, East (Mr. Frank Allaun) pointed out, the landlord can force improvements to be carried out despite the resistance of the tenant. It is understandable that tenants are worried about improvements to conditions which have been tolerated by landlords for 30 or more years because the tenants fear that they will be unable to meet the increased rents which will result from those improvements.
    I do not know about the situation in England and Wales, but in Scotland there is a possibility that the tenant will be able to withhold his consent for improvements to be carried out. However, there is a catch in it. If the landlord wishes to proceed with improvements against the tenants's wishes the landlord can go to the sheriff court and apply for the improvements to be done and that court, in certain circumstances, will allow the matter to go forward. It would be wrong to cast any aspersions on the legal profession, and particularly those who are engaged in the courts. But it is fair to say that their outlook on these matters is not the same as mine. I have never known the law in Scotland, England or Wales to be particularly biased towards the ordinary working-class person.
    1.15 a.m.
    Many tenants have already been approached by their landlords, as a result of the 1969 Act and possibly given an impetus by this Bill, to see whether they are prepared to allow improvements to be done. If landlords are allowed to carry out improvements, they should not be entitled to a return on Government money.
    We used to hear about the poor landlord who has inherited property which he did not want and the landlord who, immediately after the war, had to buy a tenement flat to get a home for himself and found that he got a bad bargain in taking over property which needed a
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    great deal of maintenance. Now there is strong evidence that the property companies are finding it profitable to buy older houses with poor amenities, which have been neglected for generations, and to make block applications for improvement grants. I understand that the local authorities have no discretion in these matters in relation to standard. Provided that these applications meet the qualifications in terms of plans, they must go ahead and allow the grants.
    Whether a local authority would be within its rights in refusing discretionary grants on the ground that these were block applications specifically for profit making, I do not know. It may be that some local authority will have to challenge the matter by saying, "We do not believe that this is the way that the money should be spent. If property companies wish to make a killing in housing by carrying out repairs, they should put up their own money."
    If the matter went to the courts, I should hesitate to speculate on the outcome. I suggest that the courts might decide that this was a valid application under the various Acts. Certainly I cannot see anything in the Act which defines a landlord as being either an individual or a property company.
    We have heard ad nauseam about Government money being used to subsidise tenants in municipal properties who could afford to pay higher rents. This hoary old tale is hawked about the country and repeated month after month. This kind of subsidy to people to enable them to develop properties and increase rents on properties which they would not have allowed to get into such bad conditions is scandalous. I hope that the Government will accept the Amendment because it seeks to provide a very much needed and overdue protection for tenants.
    Mr. Ronald Brown: This area of the Bill is very weak. With respect to my hon. Friend the Member for Salford, East (Mr. Frank Allaun) the Amendment does not cover this problem. I should have appreciated an opportunity of discussing this matter with my hon. Friend, because I should have liked to have had incorporated the question of maintenance after the improvements have been carried out. When a landlord has carried out improvements he gets his regulated rent. It is assumed from that time on that the

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    quality of the house or flat will remain the same, because the tenant will have to pay a higher rent. However, experience has shown that landlords do not maintain properties to the standards achieved when the improvements were carried out.
    It might be said that the answer is quite simple : call in the public health inspector and get a sanitary notice put on the property, and so on. Somebody from the inspectorate comes along and tries to hurry the owner into getting the work done. The owner finally gets an estimate, and that represents starting the work. Six weeks, or six months, go by before the owner can be pushed into the next stage, which is getting a builder's estimate. Following that, another six months go by, and all the time the tenant is paying the increased rent which was agreed upon when the improvement grant was applied for.
    What my hon. Friend proposes does not reflect that situation, and I hope that somewhere in the Bill there will be a provision to protect the tenant. After all, a fair rent is described in the White Paper as
    "the likely market rent that a dwelling could command if supply and demand for rented accommodation were broadly in balance in the area concerned".
    We all know that it is an impossible assessment to make. Nevertheless, unless some restriction is imposed landlords will get their money and their tenants will be left to pursue them to try to get the necessary improvements carried out.
    I appreciate the point made by my hon. Friend about tenement buildings. The White Paper talks of a declining private rented market and the dissuasive effects of rent regulations on landlords. The extraordinary thing is that landlords are rushing in to buy tenement buildings in my constituency. One such building was purchased on the morning that the Minister was expected to announce his decision that it should be demolished. He made his announcement at 11.30 a.m., and it was found that the property had changed hands at 11 a.m.
    The result of that exercise is a High Court case, but the tenants are still living in distressing conditions. The new owners cannot afford to spend a penny on the property, and they are apparently waiting to take advantage of the pro-
    418
    visions in the Bill to make improvements to it. When that is done they will be able to get the rent they require, and they will make money hand over fist.
    I hope that if we provide landlords with money to improve their property we shall give local authorities and rent officers the opportunity to assess from time to time whether the standards of maintenance of properties in their areas are up to standards for which the grants were made.
    Mr. Channon: This is an important Amendment, and I shall try to deal with the points that have been raised. If I fail to deal adequately with the Scottish points, I am sure that hon. Gentlemen will forgive me if they are answered by my hon Friend the Member for Ayr (Mr. Younger).
    I am tempted to talk about sheriff courts, but the right hon. Member for Kilmarnock (Mr. Ross) would be—
    Mr. William Ross: Perhaps the hon. Gentleman would talk about the Procurator Fiscal
    Mr. Channon: The night is young, and I might do that. What I have to say applies to Scotland, but if I do not deal adequately with the Scottish points that have been raised perhaps my hon. Friend will be permitted to deal with them.
    The hon. Member for Shoreditch and Finsbury (Mr. Ronald Brown) has, on many occasions, raised the case to which he has just referred. The hon. Gentleman is to be commended for his diligence to his constituents, but he will not expect me to deal with the merits of the case in question because, as he said, a court action is pending.
    The hon. Member talked about maintenance of houses in disrepair. In fairness, he should look at Section 72 of the Housing Act 1969, which gives local authorities the power to require the repair of houses. This should help. A tenant can go to the rent officer if his circumstances alter, if the house falls into disrepair and so on. That is not a complete answer but the Act gives local authorities the power to insist that repairs are done and if certain statutory processes are gone through the tenant can carry out the repairs and make the landlord pay for them. That is certainly a step forward.

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    It is probably true that what the hon. Gentleman said about the working of the fair rent system and the rent officers represents a minority view. [Interruption.] That may not be so in Scotland but I think it is the case in England and Wales. I do not say that the hon. Gentleman is wrong, minorities are often right. Most people think that the fair rent system has worked reasonably well. The Francis Committee recently reported and it unanimously concluded that the system was working well. There was a minority report on certain aspects of the subject. But that was the unanimous conclusion of the Committee, and there was a Scottish member.
    Mr. Tom McMillan: He was outvoted.
    Mr. Channon: No, he was part of the majority. The Scottish and Welsh members and the English members, with one exception, were unanimous on all points. I am glad that the Scot was able to influence the Committee. Mr. McNiven was his name and he was appointed by the right hon. Member for Kilmarnock (Mr. Ross). I congratulate him on a very wise appointment.
    The hon. Member for Salford, East is well known for the strength of his views on this issue and for the battle he has waged on behalf of controlled tenants over many years. His view is not generally held in the Committee. He pointed out that he was against a Section in the 1969 Housing Act introduced by his right hon. Friends. For all I know he may have voted against the 1968 Act—he spent most of his time last Parliament voting against his right hon. Friends and I respect him for that.
    Mr. Allaun: In Standing Committee three Members on the Labour side who had pressed the improvements scheme very strongly voted against taking houses out of the existing control when they were improved.
    Mr. Channon: I recall reading that debate and I recall an earlier occasion in 1967 when the hon. Member also voted against his right hon. Friends. He is consistent in his point of view.
    Mr. Ross: Does that mean that my hon. Friend must not vote for it tonight?
    Mr. Channon: We shall have to see.
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    1.30 a.m.
    The fair rent system was largely the creation of the right hon. Member for Coventry, East (Mr. Crossman), built on by the now Lord Greenwood, and it had the support of nearly all hon. Members of the Labour Party, and at the time it perhaps did not have the enthusiastic support of some of my hon. Friends. However, it would be neither appropriate nor in order for me to discuss the whole principle of the fair rent.
    I appreciate that the hon. Gentleman has considerable doubts about the whole principle of fair rents. I understand his argument—that as landlords will receive a larger improvement grant, extra attention should be paid to that when the fair rent assessment is made—but I believe it to be a misguided one. The Bill is concerned only with a small limited item, and that is to increase the rate of grant in the intermediate areas. It does not raise wider issues, though I am sure that hon. Members would like to debate the whole issue at some time. I suspect that there will be occasions in the coming months when we shall debate rental policy, and then it will be in order to consider the fair rent system and whether it should be changed.
    Mr. Frank Allaun: The hon. Gentleman is making his case in a courteous way. He is suggesting that the Bill is confined to grants and is not concerned with rents. How can one discuss grants and ignore rents? It is like increasing the speed limit to 75 m.p.h. without taking steps to protect pedestrians. In either case the two cannot be separated.
    Mr. Channon: I accept that the two are linked, but I will try to show that this is not the time to make the sort of Amendments the hon. Gentleman wishes to make.
    As the law stands, a fair rent has no regard to the personal circumstances of the landlord or tenant. The hon. Gentleman is seeking to take into account for the first time the fact that the person has had public money and he wants that to be a criterion in assessing a fair rent. At present a fair rent is assessed, it is claimed, on objective criteria. A fair rent is defined broadly as the market rent discounting the scarcity factor. To import some other consideration would be to change the whole system.
    Mr. Robert Hughes: Perhaps the hon. Gentleman will refresh my memory. Does not the 1969 Act call on the rent officer to take into account any money spent by the tenant in improving the property? If so, cannot the same consideration apply in the case the hon. Gentleman is now answering?
    Mr. Channon: I will be dealing with this point later. If I forget to do so, I trust that the hon. Gentleman will draw it to my notice.
    Section 46(1) of the 1968 Act defines a fair rent and how it should be determined. It says :
    "In determining for the purposes of this Part of this Act what rent is or would be a fair rent under a regulated tenancy of a dwelling-house, regard shall be had, subject to the following provisions of this section, to all the circumstances (other than personal circumstances) and in particular to the age, character and locality of the dwelling-house and to its state of repair."
    On the technicalities of the Amendment, it is my belief that with the wording of the Rent Act, 1968, and the Section which I have just read, even were we to accept the Amendment, given that particular wording it would not make any difference, because even if the rent officer were to consider that public funds had been used, it would not affect any of the criteria laid down in Section 46 of the Rent Act, 1968, by which fair rents are determined.
    But that is a drafting argument rather than an argument of substance to meet the hon. Member's point. The argument of substance is that the hon. Member is seeking that a rent officer should take account of the fact that an increase in value results mainly from the 75 per cent. grant. The implication behind the Amendment is, naturally, that a lower fair rent would be set for such a dwelling. Acceptance of the Amendment would introduce a fundamental change in the detailed rules which govern private rents where there have been grant-aided improvements.
    The House may decide at some future date—I doubt it, but it is possible if one could imagine such a circumstance—that such a consideration ought to be part of the assessment of fair rents. But, if we believe that that is the case, it makes no difference in logic whether one does that with 50 per cent. or with 75
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    per cent. If it is urged that such things should be disregarded by the rent officer and that new criteria should be imported, the argument is equally strong whether one does it for 50 per cent. or for 75 per cent.
    This modest Bill merely raises the grants in certain parts of the country. What the hon. Member should do, if he is moved to try to change a criterion for fair rent is to seek an opportunity to deal with the main question as to how a fair rent is assessed and what are the criteria. I suspect that we shall have plenty of opportunities of discussing that in the not very distant future.
    I should point out some of the difficulties that would arise were the Committee to accept the Amendment. First, one would have to have different rules for assessing fair rents outside development and intermediate areas than one has inside them, and an entirely different criteria for assessing the fair rent. Within a development or an intermediate area one would also have to have two different criteria for assessing fair rents according to whether a property had received a 75 per cent. improvement grant under this Bill, or a 50 per cent. improvement grant under some previous Bill, or, indeed, after the expiry of this Bill. The Committee will agree that that would give rise to confusion and anomalies.
    There are great practical difficulties. I am not sure how rent officers would necessarily know whether a house had received a grant. If it were the will of the Committee that this should be done, I am sure that these difficulties could be overcome. However, there would be considerable difficulties. At present there is no duty on a person to tell a rent officer that he has had an improvement grant of this kind, and the rent officer would be required to find out what the fair rent is and then to reduce it by a certain proportion to take into account all the factors that the hon. Member has in mind.
    I suggest that this is not an Amendment which is appropriate to this Bill. The Amendment strikes at the whole basis of assessing fair rents in general, and the House will have to decide, in the coming months, whether fair rents are assessed equitably not only in the private

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    sector but, in view of the changes proposed by the Government, in the publict sector also. If the House decides that fair rents is an equitable way of deciding rents and the criteria that ought to be considered, that is the moment when this related question ought to be considered.
    In a limited Bill dealing with a limited problem what the hon. Gentleman suggests would, I suspect, cause more confusion and problems or anomalies than it would solve. I therefore hope that the hon. Gentleman will not find it necessary to press the Amendment.
    Mr. Freeson: Whether my hon. Friend the Member for Salford, East (Mr. Frank Allaun) wishes to press the Amendment or not and whether the Under-Secretary wishes to accept it or not, others of us will accept that my hon. Friend has raised a very important point. At the very outset of his remarks the Under-Secretary was a little provocative. No doubt he is sorry for that now, because otherwise perhaps I might not have risen to my feet.
    There is an important point here. Much of the discussion has hinged on the relationship of the Amendment and what it seeks to do to the position, not only in the 1969 Act, but also in the Rent Acts of 1965 and 1968 where the proposal for fair rents was first set down. When the 1965 Rent Bill was before the House, in the early stages there was a great deal of discussion, both in the House and publicly in many quarters, about the difficult problem of definition, of which the Under-Secretary has made heavy weather, but I do not say that necessarily critically. There was a good deal of discussion about the merits or demerits of leaving the definition of "fair rent" in the form in which it remained in the Bill as enacted. A number of hon. Members, of whom I was one, had serious doubts about that.
    When the Francis Committee was set up to examine and review the operations of the Act it was hoped by a number of hon. Members, including myself when I was in the position which the Under-Secretary now holds, that this aspect, too, would be taken account of. Views were not expressed, because it would have been wrong for any member of the Government to have done so while a committee to which he was a party was investigating
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    the matter independently. Some of us expected or hoped that this aspect would be dealt with. A number of views to this effect were expressed in serious articles in the Press, not only by people in the Labour Party, not only by people working in the social services and in welfare, but also by people in development. Some of the bigger private developers were concerned about getting a more sensible and rational approach.
    One of the points which was revived in public discussion before Francis reported was precisely the point about re-considering the criteria of fair rent to take a closer account of actual cost involved on the part of the owner of a property in purchasing, in maintaining, in modernising—whether under improvement grant procedure or otherwise. Although I have not reached any firm or detailed view on this I am generally of the view, or I have come back to the view which I expressed on the original Rent Bill, that there is much to be said for being more specific about the criteria to be set by way of wording in the legislation or in guidance to rent officers.
    We have not heard the last word on this. "Fair rents", which begs to question as a phrase, must always be defined. I doubt whether we should continue to define them solely as market rents less scarcity value, although that may have served a very useful purpose in the initial stages of the operation of the 1965 and 1968 Acts. I am inclined to the view that we should seek to relate the establishment of rents to basic costs and a fair return. In other words, we should return to the principle first enunciated in the 1949 Act in relation to improvements and which my hon. Friend has resurrected tonight—that is, a percentage return on outlay by an owner.
    1.45 a.m.
    In the White Paper, "Fair Deal for Housing", published today, this issue is raised once more along lines which will create even further difficulties. In paragraph 13, in the section on house improvement, it is said :
    "The landlord will still be allowed to charge, as soon as the improvement works have been carried out, a rent increase whose annual rate is 12½ per cent. of the amount (net of grant) spent on the improvements. But charging this increase will no longer interfere with the landlord's right to apply for a fair rent"
    that is, market rent less scarcity value. If it be wrong to pursue the principle

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    of a given return—10 per cent., 12½ per cent., or, as it was in 1949, I think, 8 per cent.—one wonders whether it is right and proper to continue the policy enunciated once more, in a very conditional way, in paragraph 13 of the White Paper. Why is it considered wrong to establish rents basically on the principle of a fair return on the capital and running costs of private property?
    This is a limited debate, and the point will not be pressed, but I give general support to the case which my hon. Friend has advanced. The time has come, since the whole issue of rent policy in the public sector and, to some extent, the private sector is under debate again, to reconsider this question. We shall have to look far more closely at it.
    I hope that the Minister, in the liberal and considerate spirit in which he answered my hon. Friend, will not close his mind to a careful re-examination of the criteria upon which fair rents, where labelled as such, are determined. The question must be reoponed. Let him and his colleagues consider whether a fairer basis can be established than just market rent less scarcity value. I think that the House will wish to do that, as we proceed in the months ahead, to use the hon. Gentleman's phrase.
    If we can move in that direction and make the Rent Acts more effective and more fair, we shall at the same time help to restrain inflation. There is no doubt that, where there is a big jump between actual costs and a given percentage return, such as my hon. Friend proposed in a limited sense in his Amendment, and market rents way above the actual costs in which the owner is involved in running property, and we continue to legislate in those terms, we encourage inflation, and we encourage the continuance of unfair burdens on the ordinary householders who live in rented property.
    Amendment negatived.
    Clause 2, as amended, ordered to stand part of the Bill.

  Clause 3

    INCREASE IN FINANCIAL ASSISTANCE IN SCOTLAND
    Question proposed, That the Clause stand part of the Bill.
    Dr. J. Dickson Mabon: I do not press for specific answers to my points tonight, but merely seek from the Under-Secretary of State for Development Scottish Office, the assurance that he will consider them when we debate other matters later on today, when the White Paper for Scotland is published following that for England and Wales yesterday. I welcome the hon. Gentleman to our discussions. The Under-Secretary of State for Health and Education was here for the Second Reading, and his hon. Friend the Under-Secretary of State for Home Affairs and Agriculture has been here. It is nice to have a variety of Under-Secretaries from time to time.
    No doubt the Clause and its implications for Scotland will be reflected in the Bill that is to come before us. I have reserved my hon. Friends' position, just as my hon. Friend the Member for Willesden, East (Mr. Freeson) did on behalf of his English colleagues, on the practice in the present rent system in Scotland. We do not go along completely with what the Francis Committee says. There is evidence since the publication of its Report to show that a number of assumptions are wrong.
    The principle that if a tenant has done work on the house he may be given an amelioration in his rent by the landlord is already written into the present system. It is fair to argue that that landlord should not exact a higher rent when he has had public money. There may be other principles that we must debate, and the Under-Secretary may well promulgate a few more in the White Paper.
    I have an earnest correspondent in my constituency who was fascinated by our exchanges on Friday and wrote at once to give me other suggestions. I shall put them to the Minister, and my hon. Friends from the Glasgow constituencies will probably want to put a few more ideal into his head.
    Tenement properties are the most difficult to improve. The trouble is multiple ownership, which was one of the great

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    headaches at the time of the storm damage. It was not easy to find where the authorising responsibility lay, never mind the person who benefited. The answer to question 4 on page 3 of the hand-out encouraging people to apply for improvement grants shows that they must give a guarantee that the home has a life of at least 15 years. That cannot be done where a person does not own the common stairs and the fabric of the property above and below and does not have complete control over the plumbing—not just the existing plumbing but the extra plumbing that may be required under the new water board regulations and so on. There may not even be majority control by a combination of owner-occupiers. We must see whether there is another way of helping people who want to carry out improvements but who are in a sense vetoed because a landlord may be reluctant, or have elderly tenants who are reluctant to opt into the improvement scheme.
    In the Labour Party we do things extremely well. If I were told that the improvement grant system was 90 per cent. correct, I should be delighted. I pressed the hon. Member to say whether it was 99 per cent. correct, but I never expected him to say that it was 100 per cent. correct. It is not ; there are defects in the improvements system and this is one. There are others which I shall mention on another occasion. Perhaps I ought to send this letter to the Under-Secretary and let him reply to it.
    There is an unfair distribution of money for discretionary improvements. There ought to be a comparison between the practices of authorities to see whether some are fairer, or less unfair, than others in giving money. This is an important matter. It is rather like valuation in Scotland, although this criticism does not apply to England—we want some kind of referee to make sure that the discretionary grant system is reasonably fairly operated, even though by its nature it has a discretionary element which gives rise to variation.
    I shall content myself with those remarks. We are anxious that Clause 3 should become part of the Bill, but I assume that the practice of fair rents will be radically considered, especially if the
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    Government are to found their new policy for the private sector on the fair rent system more formidably than before. In defence of the history of this matter I remind the Government that the improvement grant legislation came after the fair rent legislation and to that extent the latter did not anticipate what the former would be. Now it is to be done the other way round and we should look at the matter again.
    If the Minister takes refuge in the argument, and I must confess that it is good argument, that the situation in England will be so diverse and fragmented because of the restriction, which we do not like, in the Bill in development and intermediate areas, let the argument stand : my hon. Friend the Member for Willesden, East (Mr. Freeson) can tackle that. But that argument cannot be used about Scotland, and it is important that the Under-Secretary should acknowledge that there is no such argument there.
    Mr. McElhone: I, too, welcome housing improvements. Speaking parochially, it is a pity that in my constituency we could not have prevented many of the concrete jungles in our new municipal housing projects, as we could have done if many years ago we had had the foresight to have housing improvements. There is some fine tenemental property in the constituency and, with some foresight and the expenditure of some cash a decade or more ago, it could have been greatly improved, thus sparing the local authority and the Government many thousands of pounds.
    What I fear about housing amenity is its sameness, the barrack type of dwelling, the monotonous type of construction which we seem to have perpetrated in our housing improvement schemes. There are reasons for this—the haste to build, the shortage of ground, the rush for housing, particularly in the post-war period.
    Will £15 million be enough for Scotland considering that housing in Scotland is much more expensive than in the rest of the country and that, because of the higher standards which we set ourselves in housing, repairs and renovations and improvements are more expensive, too.
    One of the main difficulties in implementing the scheme will be getting planning permission from local authorities.

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    If there is any major reconstruction to be done, it will certainly need planning permission. As often as not, because of the archaic system of planning controls, many months and sometimes years are taken up with getting planning permission. If we have a spate of planning proposals, the resulting delay and the fact that a scheme must be undertaken within two years of receiving planning permission will militate against people taking advantage of the money allocated to Scotland.
    Does the Minister envisage any of the £46 million being spent on the older municipal housing estates? They were built in great haste because of the pressure for new housing and a great deal could be done to improve them, particularly in the peripheral areas of Glasgow where they lack amenity and are depressing places. Could part of the money be used to make them more pleasant? As rents increase and with transport difficult and expensive, they could become municipal deserts.
    People may find it easier to purchase a home with a mortgage than live on these estates. In the older parts of my constituency people are living in tenement homes often without water and certainly without light for weeks and even months in some cases. It is not because they cannot get homes but because they are offered only houses in these peripheral areas which they are most reluctant to take. They would rather undergo these privations in the hope of getting a house which is more acceptable without the difficulties of travelling.
    Would the Minister agree to the money being spent by local authorities on prewar obsolete housing because these homes contain a great fire risk which Glasgow local authority is dealing with. Obsolete electrical wiring, installed when people had only a radio and an iron, is one of the main reasons for the danger. Glasgow has over 100,000 municipal houses built in the 1919 period. Many families have put in extra plugs for fires, refrigerators and other appliances and this throws a burden on the circuit which it was never designed to take. The large number of fires in these homes have compelled many local authorities to take action, but some are reluctant to meet the challenge. I hope the money could be used to deal with this danger.
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    Another point which comes close to my heart is the question of improving the housing of the chronically sick and disabled. As I have told the House before, I am conducting a door-to-door survey in my constituency. It is now coming to a completion and is providing useful information. It shows the need for improvements and aids for many chronically sick and disabled people living in older property. Many of them would perhaps qualify under medical priority for new housing, but just as important as new housing is the companionship and friendship they have in their neighbourhood. Because of this, many of them are reluctant to take a new house. In many cases also, the older houses can be made perfectly adequate for them by the provision of a ramp or of a certain type of toilet, for example.
    I hope that the Government will give more thought to this aspect, including perhaps the installation of warning systems which do not cause a great deal of money but allay the fears of disabled or chronically sick people living on their own and perhaps seeing only a home help for a couple of hours in the day. I would like to think that the right hon. Gentleman will have regard to the position of the chronically sick and disabled under the Bill. My survey suggests that the estimated figure of 270,000 people in Scotland with some form of disablement is a gross under-estimate by Government reports.
    Perhaps the Minister could also allude to the problem of people living on long-term socia security benefits old-age pensioners and other people with small incomes qualifying for improvements. I would like to think that people in more necessitous circumstances could enjoy a little more comfort. As they do not qualify for new housing because of overcrowding or redevelopment, they have to endure many privations in the old-type tenemental dwellings. By arrangement with the local authorities or the Department of Health and Social Security, perhaps we could provide financial assistance under the Social Work (Scotland) Act which would benefit people living in such circumstances.
    Many people will be reluctant to take advantage of this type of scheme because of their fear that their rent will go up. I do

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    not want to elaborate further on the lessons of the storm damage, but paramount in the success of a scheme like this is adequate supervision, because otherwise many unscrupulous operators could find in the system a gold mine in repair work, particularly on roofs, which is hard to estimate by the ordinary tenant or owner-occupier. I hope that there will some form of supervision so that the public money to be spent achieves everything that the Minister intends.
    To many Tory councils with many prewar and rather ancient council houses under their control, this scheme could be a get-out whereby they can improve the property and then sell. It is a distinct possibility. Local authorities are not too happy with this type of dwelling, and under this Bill could improve it to the required standard and then, under the other legislation which, I am glad to say, is not working very well, could sell it, taking them out of the public housing stock. The 1957 Act caused a great deal of hardship. I hope that this Bill, by a more sophisticated means of increasing rents, is not the 1957 Act in another form. We must rethink the question of a fair rents policy. I support my colleagues on the Front Bench who have warned the Government that, while they may accept this Bill, the legislation which we are to have very shortly will come under the closest scrutiny and we shall try to ensure that the people we represent get the maximum advantage from what I think will be disastrous legislation.
    I should like the Minister to give us assurances on this matter. I fear greatly—and it is a genuine fear which is shared by nearly all my hon. and right hon. Friends—that the statement on Scottish housing finance which we shall have later today, which will impose penal rent increases on many people, will discourage many people from taking part in any of these schemes. This Bill, involving £46 million for the whole of the United Kingdom, represents the tinsel concealing the package of real misery which future Tory housing legislation will bring.
    Mr. Tom McMillan: I believe that the Clause will be welcomed in Scotland. It is an extension of the work carried out by the previous Administration. However, where I part company from the Govern-
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    ment is that they have not looked at the working of the previous legislation. Under previous legislation, people made beautiful houses more beautiful, which did not help to solve the housing problem in Scotland, especially in the Highlands. The two-year Clause in the Bill will help those in Glasgow's public sector no end, but the Bill will do nothing about the worst housing problem in the whole of Europe. The previous Administration wanted to see how their Bill worked with a view to adapting and changing it to suit the problems of Glasgow.
    The first thing which we shall have to do in Glasgow in the private sector will be to get the people out of the huge tenement blocks. Only two-thirds of them will go back. It will take from 12 to 18 months to house them, and yet we must get the project finished in two years. What help will this be to Glasgow? We may offer people grants, but the outside structure of the buildings is such that they take a chance if they invest the Government's and their own money in them. I hope that the Minister will be able to point to some project in Glasgow where assistance has been given in two years. The Bill will not bring any relief in the sector in Scotland where it is most needed.
    The previous Administration were wrong in not accepting Glasgow Corporation's proposal that the houses which stood in house treatment areas should be counted. I am now in the horrible position of being attacked by the council and by the Press for demolishing buildings and getting people housed, and I now have to run round saying "Keep the buildings up", because I have to make a survey for the houses to be treated. This is vitally important in my sector where about 25 per cent. of the houses are condemned and cleared. I am now sorry I cleared them.
    2.15 a.m.
    Will the Minister extend the two years to four years for Glasgow? Rehabilitation in a standard tenement means evacuation of the tenants, knocking three houses into two and building bathrooms. This is a long-term job taking about two years, and it would be of great assistance if four years could be allowed.
    I do not fall out with the selling of houses, but I am concerned about the

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    rackets in Glasgow. A young couple about to be married went into the factor's office. They were offered a house for £400. On asking what its life was they were told to ring up the planning deptment of the Glasgow Corporation. They did so and were told that the house would not be redeveloped until 1980. The couple thought that they would get ten years out of the house, and they spent £300 on decorating it, only to find that it was condemned before they ever moved in. The house became dangerous, and on returning from their honeymoon they had to go to Forest Hall.
    A huge property firm is involved in this racket. As soon as a tenement building becomes empty the firm buys it for £75 and then sells it for £400, when the life of the building is nothing.
    A period of two years is useless and will do nothing to help Glasgow's housing problem. I hope the Minister will look carefully at this and, if not in this Bill, in a later Bill, bring in an extension in the private sector in Glasgow to give a longer term.
    The Under-Secretary of State for Development, Scottish Office (Mr. George Younger): We have had an interesting and short debate, which has covered rather wider ground than the Clause we are discussing. The Clause does for Scotland what previously was done in the provision for England and Wales. There are no substantial differences in the Clause which differentiates it except that it is different in slight matters which are necessary to fit in with Scottish practice. There is special treatment for the Highland counties, which has always been the case, and this is preserved in the new grants.
    The object of the Bill and of the Clause is to reinforce success. I have often in the past complimented the Labour Party on having brought in improvement grants in the 1969 Act. That Act is working extremely well and we believe that this dramatic increase in the money available will make an already good scheme work even better.
    I was asked by the hon. Member for Glasgow, Central (Mr. Tom McMillan) whether the scheme could be extended beyond two years, particularly in regard to Glasgow. I am afraid that I must
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    say that we do not intend to do so. The whole point of the Bill and indeed of the Clause is to see that the work encouraged by these higher grants is concentrated in the next two years. I take the opportunity to urge everybody concerned with housing in Scotland owners—owner-occupiers, landlords and local authorities—to move now, and move quickly, to take advantage of the special two-year system which is being brought in with the express purpose of encouraging work to be done.
    Mr. Tom McMillan: I know the hon. Gentleman means well, but possibly I did not get my point over to him. First, if we wish to rehabilitate people we have to rehouse them. Those people want corporation houses, and they want to go to particular places. This takes a long time, and by the time the people are rehoused, a year to eighteen months have gone before work has started. Two years means nothing to the people of Glasgow.
    Mr. Younger: I should have resisted the temptation to give way. I was just about to cover the point made by the hon. Gentleman in his original speech. I would be the last person to underestimate the difficulties of improving properties ; every job tackled is different from the previous job. There is also the complication of multiple ownership and the difficulties which arise because people do not want to have their houses improved and will stick out and hold back other people. But accepting these difficulties—and they are probably schemes which will take longer to do—there are many cases in the City of Glasgow where work could be put in hand fairly quickly.
    Mr. Tom McMillan: Name one.
    Mr. Younger: No. There are many individual cases involving houses all over the city where work could be gone ahead with. The corporation has set up a special department to progress the house improvements programme, and I hope that it will do well and that the corporation will press ahead. Of course, there will be many cases which may be impossible to do within the time scale, but there are also many cases where work can be done quickly. It is up to everybody to get on with the job and to try to get it done.

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    The hon. Member for Greenock (Dr. Dickson Mabon) made a number of interesting points, many of which, as he said, will come up for discussion on other legislation. I do not want to go into them now, but I assure him that when we come to discuss housing legislation in general we shall be glad to look at any suggestions he would like to make for improving the system. We are agreed that this is a particular Bill which has a particular purpose and that this is not the place to debate, for example, the basis of fair rents or any other methods of housing policy. I take the hon. Gentleman's point and we shall be happy to look at any suggestion he cares to make.
    The hon. Gentleman then raised the difficulties which are involved in improvement, which is a matter on which I have already touched. One of the main points in the 1969 Act was to give local authorities power to deal with unfit houses by improvement of the houses in an area. If a landlord refuses to improve his houses to the tolerable standard, or, indeed, if he does not co-operate with the other owner-occupiers or landlords in the area, the local authority can step in and acquire the houses for improvement if it so wishes. I recognise that this is sometimes difficult.
    The hon. Gentleman referred particularly to page 4 of the booklet which we published about house improvement which relates to the 15 years life which is expected to be required. This is the normal requirement that can be made. However, local authorities can, if they wish, give standard grants for a lesser period down to seven years, and even less, with the consent of the Secretary of State.
    Dr. Dickson Mabon: What about multiple-owned properties where one cannot say who is the owner of the stairs or the fabric above and below or the plumbing? This is important.
    Mr. Younger: Local authorities can be flexible on these matters. The normal practice is 15 years. The hon. Gentleman will find that local authorities can be flexible to a certain extent and can also get permission from the Secretary of State in particular cases.
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    The hon. Member for Glasgow, Gorbals (Mr. McElhone) asked whether the total sum of £46 million for the United Kingdom as a whole could be spent on municipal estates. It certainly can. We are encouraging local authorities to modernise their stocks of municipal houses, and a substantial number have been and are being done. The statistics show that out of a total of 17,508 houses in local authority improvement schemes in 1970, 15,429 were done to houses built with subsidy. Grant is available for putting in an adequate electrical power supply, and it has been used for this purpose in a large number of cases.
    The hon. Member for Glasgow, Gorbals also referred to houses being specially adapted for the disabled and chronic sick. We all know of his interest in these matters. If a house owned by a disabled person qualified for an improvement grant and, because of that person's particular handicap, a more expensive type of fixture was required—for instance, a recessed or sunken bath—the local authority has power to grant-aid the cost of the more expensive fixture. I hope that local authorities will do this in cases of such need, and I shall do whatever I can to encourage them to do so.
    Mr. McElhone: I mentioned modernising old municipal houses, especially in Tory-controlled local authorities, and such houses being sold. I am concerned about the principle of the matter. I think there is a great deal of sympathy for the point expressed by my hon. Friend the Member for Salford, East (Mr. Frank Allaun). Has the Minister any observations to make on that point?
    Mr. Younger: I want to be brief. This question goes much wider than the Clause. It is most unlikely that a local authority, controlled by any party, would want to go to the trouble, expense and difficulty of improving houses, for which it gets a grant in the form of a Government subsidy over many years, and then sell them for a "quick profit". In any case, the proposals which are in train for the sale of council houses apply to sales to sitting tenants, not sales of vacant houses to anyone who comes along, unless there is no waiting list in the area and then only by special permission of

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    the Secretary of State. Although it is technically possible, I think that it is a most unlikely thing to happen. This is a matter which we can look into in due course.
    I do not agree with the hon. Member for Glasgow, Central when he says that the Bill will do nothing for Glasgow. Glasgow's programme, agreed to by all the parties concerned, is to try to improve no fewer than 10,000 houses by 1980. That is a formidable task, and though it has got under way well, it is a long way from being guaranteed to achieve 1,000 houses a year, which is needed if the targets are to be met.
    I believe that the Bill will provide a splendid impetus to Glasgow's programme to improve 1,000 houses a year over the next ten years. Many people in Glasgow will look at the Bill in that way, and they will have every help to get the improvements under way. I hope that the Committee will approve the Clause, just as I hope the House will approve the Bill in due course.
    2.30 a.m.
    Mr. Ross: I rise only because of some of the comments of the hon. Gentleman about the Measure of which I was the author. I am happy that the hon. Gentleman paid tribute to what was done, because most of the improvements that have been carried out to houses have been done under the provisions of that Act. I notice that hon. Gentlemen opposite are always careful not to mention their 1964 Act, which was going to solve all these problems. I do not suppose the hon. Gentleman knows anything about it. If he is frank, he may say that he does not. It was never used. Hon. Gentlemen opposite do not have a very bright past in this matter, and it would be as well if they were to listen to some of the criticisms advanced by my hon. Friends about this Bill.
    My hon. Friend the Member for Glasgow, Central (Mr. Tom McMillan) spoke about the special position of Glasgow in relation to the limitation of the period, but he was not talking about the same kind of houses as the hon. Gentleman was. The position of these tenemental properties is unique. There is the special position of multi-ownership and of varied ownership. Some are owner-occupied, while others are tenant occupied, and it
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    is sometimes extremely difficult to get agreement to do some of the things about which my hon. Friend spoke. I think that there was a misunderstanding about the intervention of my hon. Friend the Member for Greenock (Dr. Dickson Mabon).
    It is tragic that the Bill is being debated at this hour. It should not have been taken in a Committee of the whole House. It should have been considered in Committee upstairs, followed by a Report stage in the House. I am sure that some reasonable Amendments, if not the four years for which my hon. Friend has asked, could have been accepted.
    It would have been helpful if the Bill had not contained this provision about the work having to be completed within two years. After all, it is now 14th July, and the Bill is not yet an Act, yet its provisions take effect from 23rd June. Does the Minister think that the people concerned know about the Bill? The right hon. Gentleman expresses the hope that they do, but if there had been more time in which to consider the Bill there would be no doubt about that. The Government have been late in introducing the Bill to achieve the maximum effect.
    Every city in Scotland is affected, because the whole of Scotland is either a development area or an intermediate area, and therefore the Bill covers both Edinburgh and Glasgow. Will the Minister ask local authorities how long it will take them to process some of the work that he wants them to do? I am sure that they do not have rolling plans for improvements, even though I should like to think that they have.
    The Minister is limiting the beneficial effects which we all want to achieve by limiting the period. If, instead of saying that the works had to be completed before the expiration of two years, he had said that they had to be started within that period, that would have provided a certain amount of overlap. That is a reasonable Amendment and I would be prepared to move it if the hon. Gentleman is prepared to accept it. It has been done before. I managed to achieve it during the passage of the Caravans (Site and Control of Development) Act in 1960.
    If hon. Gentlemen would come here more often they would learn how to do

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    things. These benches should be packed instead of merely Famine, Death and Pestilence in the form of the three hon. and right hon. Gentlemen on the Government Front Bench giving us the benefit of their knowledge about housing improvement in England, Scotland and Wales. I am disappointed that the Secretary of State for Wales, or his representative is not here. The hon. Gentleman has under-estimated the problems of the private sector in Scotland.
    When I was Secretary of State I was concerned about the extent to which we were spending money, not just repairing storm damage but the damage of generations. My hon. Friend the Member for Greenock, who was Minister of State then and who handled, very well, the problems of storm damage in Scotland will bear me out. I was concerned that some of the properties would be sold.
    Mr. Tom McMillan: They have been.
    Mr. Ross: I felt then that some Bill should be introduced to stop this. I do not know whether the hon. Gentleman has investigated the extent to which people have repaid Glasgow for the money spent. I was being attacked at that time by hon. Members opposite because this was not being pushed enough. I was told, "Make this a wartime effort, spare nothing". We are getting very little back from these people.
    If a local authority exercises its power to improve a house there is nothing on earth to prevent it from selling that house in the same way as any other house. It is to be hoped that it gets a better price from the sitting tenant. The hon. Gentleman spoke about the Secretary of State exercising authority if there is no waiting list in the area. I am glad to hear that. I wonder whether his right hon. Friend agrees. As far as I know they were prepared to sell any local authority property, irrespective of the sitting tenant or the waiting list. The whole idea is to sell to sitting tenants, not to empty council houses to sell them. I do not want to prolong this but the hon. Gentleman should be more careful about the words he uses, even at this time of night.
    Mr. Younger: The right hon. Gentleman has not heard correctly. The ques-
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    tion whether there was a waiting list refers to any request to sell a vacant council house and not to sell houses to a sitting tenant. That is the difference.
    Mr. Ross: I have a bad habit of writing down what hon. Members say. The hon. Gentleman did not say that. He did not get it right. I have no doubt that suitable changes will be made—I hope they will be—to ensure that nobody who reads what the Minister said will be misled by his words.
    In general, we wish the Clause well because we want to see these improvements made. I only regret that it is limited to a two-year period, with a carryover in respect of expenditure incurred. My hon. Friends and I would have liked to have spoken at length on a number of issues raised by several Amendments that we had tabled, but because of the hour and other considerations, we are having to curtail our remarks.
    We could have spent a great deal of time speaking about fair rents. What about the Francis Committee? The Lone Ranger, if I may call him that—the one Scottish member of that Committee—would certainly not have accepted every dot and comma of its Report as being applicable to the Scottish position. We could do with some more information about that, but I suppose that can wait until we debate our new Scottish tartan version tomorrow. Meanwhile, I advise my hon. Friends not to oppose the Clause, despite its shortcomings.
    Question put and agreed to.
    Clause 3 ordered to stand part of the Bill.
    Clauses 4 and 5 ordered to stand part of the Bill.

  New Clause 2

    ALTERATION OF AMOUNT OF IMPROVEMENT GRANT OR IMPROVEMENT CONTRIBUTION
    The Minister may, with the consent of the Treasury, by order substitute another amount for the amount of £1,000 mentioned in subsection (2)(a) and for the amount of £1,200 mentioned in subsection (2)(b) of section 5 of the Housing Act 1969 and a statutory instrument containing such an order shall be subject to annulment in pursuance of a resolution of the Commons House of Parliament.—[Mr. Freeson.]
    Brought up, and read the First time.
    2.45 a.m.
    Mr. Freeson: I beg to move, That the Clause be read a Second time.
    This new Clause seeks to establish in legislation a power in respect of improvement grants which is similar to that existing in Clause 37 for amenity grants to general improvement areas. I need not speak at length on this subject because the subject matter has been dealt with, at any rate to a reasonable extent, in discussing earlier parts of the Bill.
    It has been made clear that the Government feel that Section 5(3) of the 1969 Act contains the power which the new Clause wishes to establish. But that provision lays down that any increase of the upper ceiling of expenditure allowable for grant calculation purposes can be authorised by the Minister only at the request of a local authority. Do I see the Minister indicating dissent?
    Mr. Channon: No.
    Mr. Freeson: Whatever he was indicating, he will agree that his right hon. Friend would not, out of the blue, initiate an increase in the ceiling. I do not argue with that provision in the 1969 Act and I am anxious to preserve some flexibility in this legislation. But it is a flexibility which is applicable, as the subsection says, to a particular case or class of case.
    I am seeking to establish something rather more broadly based than that. I seek to establish that the Minister may have the power to do what all of us have agreed in Committee should be the position, that is, a power generally to increase the allowable ceiling for grant-aided expenditure. There is no power in the Act, or in the Bill which amends the Act, to enable such a general increase in the ceiling of grants to be introduced by the Minister on an Order placed before the House. I make that reference because earlier the Parliamentary Secretary said that the Minister could introduce an Order. Even subsection (3) as it stands makes no reference to an Order being placed before the House. It states that he may agree, on requests being made to him by a local authority in particular cases or a class of case, that there is a need for a variation in what is still the generally accepted ceiling.
    I repeat, nowhere in the Act is there a discretionary power on the part of the
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    Minister to introduce a general review. That being so, legislatively we are in the position that we were in prior to the Housing Act 1969, and this is one of the weaknesses to which my hon. Friend the Member for Greenock (Dr. Dickson Mabon) has referred. He indicated that there is a need to look at the operation of the Act and to fill it out to the extent that the Act is not as good as it should be.
    There is no way round this. The Act does not give the Minister a general power. It gives him the power to vary the position in a class of case or a particular case. We all welcome that, and I do not question it. But I seek to establish clearly and specifically in the Bill that the Minister may introduce a general variation, an increase, in the ceiling of allowable expenditure for calculation for grant purposes, instead of just having the discretionary power to vary the position in a particular case or class of case. A "particular class of case" and "particular case" cannot mean all housing improvements, and it is that power which I seek to establish.
    As my penultimate point, I put the matter this way. If it is the view of the Under-Secretary and the Minister that they do not need this power, that it is something which they would not wish to have the power to do, or that it is implicit in the Bill or is to be found somehow in an interpretation of the Act, as distinct from a specific explicit statement in legislation, there can be no argument against the new Clause. It means that the Minister and the Under-Secretary agree with the principle I am enunciating.
    On expenditure in connection with amenity improvements in general improvement areas, in Section 37 of the Act we have already a subsection which is virtually identical to the new Clause, within the context of general improvement area amenity grants. If both sides wish to have the same general power in the Minister's hands in connection with specific improvement grants as the Minister already has in connection with amenity grants in Section 37(5), there is a clear case for having it written explicitly into the Act. We all agree that there should be such a power.
    I argue that the Minister's present power is limited by Statute and that, if he

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    sought to extend Section 5(3) by a general increase in grant levels or in the ceiling on expenditure for grant calculation, this would or could be ruled to be ultra vires. If this view is sound, as I believe it to be, it becomes even more essential that the Clause be accepted. The whole basis for tabling the Clause is not merely that I think that this is a missing element from the 1969 Act, but that we have seen evidence of steeply rising costs and, if we are to accept the view, as perforce we have to, expressed by the Under-Secretary earlier that there is at present no case for increasing these figures specifically, the Minister needs the power to vary expenditure when the Government come to the conclusion that there is an urgent need to do something which there was not the power to do under the previous legislation dealing with improvement grants : hence the drop in value under the 1949 Act.
    These are my various reasons. I want to introduce into the legislation governing improvement grants on individual properties the same power as already applies on the more limited level of expenditure with regard to amenity grants for general improvement areas. There can be no argument against the principle. I look forward to hearing how it can be explained that subsection (3) gives this general power when it refers to particular cases or classes of cases.
    Mr. Amery: I take it that this is not a probing Amendment but is a genuine attempt to improve the Bill.
    Mr. Freeson: Yes.
    Mr. Amery: The objective is certainly a laudable one with which I have great sympathy. The objective is to give the Minister power to increase by Order the cash limits of improvement grants paid by local authorities to private owners under Section 5 of the Housing Act, 1969. It is true that, unless these existing limits are raised, they would have the effect of restricting the extent of the financial assistance given by the Act. For instance, an owner spending £2,000 on improving his house, and who would apparently be eligible for a 75 per cent. grant of £1,500 under the new provisions, would find himself subject to the existing limit of £1,000 on his improvement grant. The Secretary of State already has the power
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    to make Regulations, although these could apply only generally throughout the country.
    The hon. Gentleman may have overlooked Section 5(2) of the 1969 Act. Section 5(2) provides that the improvement grant limits shall be £1,000, or £1,200 in the case of properties of three or more storeys,
    "or such other amount as may be prescribed".
    Section 27 defines "prescribed" as meaning,
    "prescribed by regulations made by the Minister".
    Section 85 provides that any regulations under the Act shall be made by Statutory Instrument, in the case of regulations under Section 5(2) subject to the negative procedure.
    In order to deal selectively with the areas to which the Bill applies—this is the problem we are up against now—the Secretary of State intends to adopt the method available to him under Section 5(3) of the 1969 Act, which enables him to approve higher amounts of grant for particular cases or particular classes of case. He will in due course approve higher amounts of £1,500 instead of £1,000 in Section 5(2)(a) and £1,800 instead of £1,200 in Section 5(2)(b). The approval will be included in the Circular to be sent to local authorities as soon as the Bill has been passed.
    As the point is already covered under the existing arrangements, I hope that the hon. Gentleman will agree that there is no need to pursue his new Clause.
    Mr. Freeson: Before agreeing to his request not to press the Clause, may I put this specific question to the Minister? Should he or any future Minister wish to vary the grant levels throughout the country, not just in specific cases but generally under the Bill or in other circumstances, has he the power to do so?
    Mr. Amery: That is my understanding, under Section 5(2).
    Mr. Freeson: As this is a serious matter, and the right hon. Gentleman accepts that I have raised it in all seriousness for the purpose of clarification, may we have an undertaking that he will look at the question again between now and the time when the Bill goes to the other place, so that there will be no doubt on this score?
    Mr. Amery: I am not giving this off the cuff. In my view, there is no doubt, but we shall look again in case there is the slighest margin of doubt. As far as I am aware, there is no doubt whatever touching the assurance which I have given.
    Mr. Freeson: I beg to ask leave to withdraw the Clause.
    Motion and Clause, by leave, withdrawn.
    Bill reported, as amended ; as amended, considered.
    Mr. Deputy Speaker (Sir Robert Grant-Ferris): I have to announce that Mr. Speaker has selected the two manuscript Amendments in the name of the hon. Member for Willesden, East (Mr. Freeson).

  Clause 1

    HOUSING IMPROVEMENT IN DEVELOPMENT AND INTERMEDIATE AREAS
    3.0 a.m.
    Mr. Freeson: I beg to move, in page 1, line 14, after "works", insert "or expenditure".
    Linked with that Amendment is the second Amendment, also in page 1, line 14, after "completed", insert "or incurred".
    Our original suggestion, to replace "completed" with "approved", was not accepted as being in order. The matter has been raised in debate time and time again as a serious point. It was raised in the past 10 minutes by hon. Members representing Scottish constituencies, when we debated Clause 3.
    There can be no doubt that we cannot rely in practice simply on works being physically completed, if we are to get the effect that we all want from the Bill. In addition to the views expressed by hon. Members we have had representations from the National Federation of Building Trades Employers, which urged that we should seek to have "completed" replaced by "approved". That could not be done, but probably the phraseology of this Amendment is better and more accurate, and I should have been wiser to use it in the first place. I seek now to use the language to be found in the Money Reso-
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    lution, in which there is an either-or situation, otherwise the expression
    "completed or incurred"
    would not have been found necessary.
    I can only assume that in accepting that Resolution Parliament has agreed that public money should be spent under the terms of the Bill not only for completed works but for works which have not taken place but on which expenditure has been incurred. To make sure about my interpretation of "incur" I consulted our old friend, the Longer Oxford Dictionary. The definition that concerns us now is :
    "to render oneself liable to ; to be liable through one's own action ; to bring upon oneself …"
    If the Government accept the Amendment they will agree to the Bill's applying wherever work has been agreed to—by whatever legal or physical process, must be interpreted in law—and which results in an incurring of expenditure, and that it is not the actual completion of works which constitutes the incurring. It may seem light-hearted to look up dictionary definitions, but I thought it was well to put on record that I had checked the meaning.
    The Amendment is fully in line with what we all seek in the Bill and with the Money Resolution. Whatever other views the Government have been unable to accept, I hope that they will at least accept this Amendment so that they and the local authorities can take the start of works for the purposes of the increased grant aid. Otherwise, as hon. Members have said and as the National Federation of Building Trades Employers has represented to hon. Members, there is likely to be a slow down in work in the last six months' operation of the Bill, and local authorities and others dealing with particularly difficult circumstances in those areas of housing which are most urgently in need of help under the Bill—Glasgow, London and other big cities and some of the worst areas within the intermediate and development areas—will find that the Bill is not operative in the latter part of its life.
    I do not propose to repeat our arguments that the Bill is narrowly drawn and that there are other stress areas which should benefit as will Glasgow, for we have already discussed these matters, but it must be our job to ensure that, within

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    its present limits, the Bill makes money available to increase expenditure to achieve our purposes. We shall have been wasting our time and just playing around with the subject if the Bill can produce results on the ground for only six to twelve months.
    I say that to underline what has already been said by hon. Members on both sides of the House on Second Reading and in Committee. The Amendment is in the terms of the Money Resolution and I hope that it will be accepted so that the Bill will be operated in the spirit which we want.
    Mr. Channon: I congratulate the hon. Member for Willesden, East (Mr. Freeson) on ingeniously finding a formula for getting his Amendment within the terms of the Money Resolution and thus being able to raise the issue which he wanted to discuss. I congratulate him because the words "or incurred" occur in the Money Resolution, and we all recall the interesting debate we had on the Money Resolution on Friday.
    The words "or incurred" in the Money Resolution refer in particular to Clause 2(2)—
    "So far as expeneature eligible for assistance under the said section 37 consists of expenditure on providing land, this Act shall apply as if the expenditure were expenditure on works so eligible carried out on land and completed at the time when the expenditure was incurred, and as if the application for financial assistance had been made at that time."
    Some works necessitate local authorities acquiring land, and for the purposes of the Bill the date of the acquisition of the land, when the authority has incurred the expenditure, will be deemed to be the date when the works will have been completed, or otherwise none of this would rank for the higher grant.
    That is why the words "or incurred" appear in the Money Resolution and that is what it means when it uses the words "completed or incurred".
    Mr. Freeson: Before we get too far along this road, and we have gone far enough already, the hon. Member is misrepresenting the position. The Money Resolution cannot be restricted as he suggests. The fact that that was in the Minister's mind when the Money Resolution was drawn up—that it related to a particular point in the Bill—is not the
    448
    point now before us. The Amendment is in order and, if passed, it would mean that the Money Resolution would cover expenditure incurred on other matters. Nothing in the Money Resolution relates to expenditure incurred on the purchase of land and the hon. Gentleman is pursuing a false point. He may wish to argue substantively on the point but I hope that he will accept the arguments put on both sides of the House and from outside before we finish tonight.
    Mr. Channon: I will deal with the point the hon. Gentleman made. I was explaining the Money Resolution. Whether the Amendment, if passed, would have the effect he wishes is another question.
    There is some doubt—I put it no higher—about the effect of the Amendment if carried. No one can complain about that. It is extremely difficult to draft Amendments to Bills. I am advised, however, that the Amendment would not have the effect the hon. Gentleman desires.
    Mr. Freeson: In law?
    Mr. Channon: Yes. I do not make a particular point of it but it is important. We cannot be categorically certain that this is so, but there is doubt, and in law it may be that the point at which expenditure is incurred is the point at which the builder is paid. If the courts put that interpretation on it, then what the hon. Gentleman is seeking would not be achieved. It would probably have the opposite effect and would not help his case.
    The substantial point he is making concerns why we fixed the two-year period and why we decided on completions rather than starts or approvals.
    I am not sure I can give an answer which will satisfy the hon. Member or whether there is any statistical or logical basis on which one could defend what we have done. Whether it should have been approvals or completions is a matter for argument. We might have said it should have been approvals within 18 months or completions within two or three years. Whatever time limit was chosen, the Opposition and hon. Members on this side would have been entitled to question the logic behind it.

    449
    The Minister decided that this policy needed a short-term boost. We wanted a short, quick spurt to bring forward the maximum amount of work that could be achieved within a limited period. Only time will tell whether we have adopted the right period. But we decided to have it on completions rather than approvals because it was much more likely to get the work brought forward as quickly as possible if it were known that it had to be completed within a stated period. That was the argument which influenced my right hon. Friend.
    3.15 a.m.
    I believe that a lot can be done in this period. Wherever I have been in the development areas since this scheme was put forward, I have found great enthusiasm and a wish to get on with the job. I have not been to Scotland but my hon. Friend the Under-Secretary of State tells me that the same applies there. My right hon. Friend and I have been to a considerable proportion of the development and intermediate areas since the introduction of the Bill and, as I have said, we have found great enthusiasm. We want to get people moving now. We believe that they are beginning to move and that there is great interest. The hon. Member for Greenock (Dr. Dickson Mabon) asked earlier whether people knew about the scheme. A lot of people certainly do and I think that the arrangements for letting people know about it are satisfactory. If they are not, we shall take the necessary steps.
    I cannot say that there is any statistical or absolutely logical reason for having a two-year period rather than, say, three years, or for having completions rather than approvals. But we believe that this is a satisfactory way of tackling the problem and getting a quick, short, sharp spurt in order to achieve as quickly as possible as much work as can be achieved in these two years.
    This being so, I cannot advise acceptance of the Amendment, although I would like to do so. I could not advise it even if I wished to meet the hon. Gentleman's point because there is doubt about the legal position. I believe, however, that we have a satisfactory basis in the
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    Bill. The House will have an opportunity to judge our success when the time comes. I know that hon. Members hope the scheme will be successful. We are more likely to get on quickly if we go for completions rather than approvals within a certain period. At the meetings which my right hon. Friend and I have had, the local authorities and the builders have not complained about either the proviso on completions or the time limit. I believe that we can get a substantial amount of work done in the time scale we are laying down. I cannot meet the hon. Gentleman's case on strict statistical or logical grounds, but I hope he will see that there is sense in what we propose and will not press the Amendment.
    Mr. Freeson: We have argued this point many times and have been unable to persuade the Government. They have made up their minds not to consider the matter further. I believe that, as a result of the Government's insistence on the Bill in its present form, we shall get a very short burst of activity and that it will be well within the two years. I think that the National Federation of Building Trades Employers, the A.M.C. and we are right and the Government are wrong on this point and that the Government are undermining the purposes of the Bill by their rigid attitude. However, there is no point in arguing the matter further, since there is no sign of movement by the Government on it. But I believe that they will regret their attitude as they see its effects.
    Amendment negatived.
    Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.
    Bill accordingly read the Third time, and passed.

MINERAL WORKINGS (OFFSHORE INSTALLATIONS) BILL [Lords]
Order for consideration as amended (in the Standing Committee), read.
Bill to be considered this day.

CORSBIE HALL SCHOOL, THORNTON
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Hawkins.]
3.19 a.m.
Mr. William Hamilton: I make no apology for initiating a debate on this school in Fife at this hour of the morning. The school was first drawn to my attention in the early part of this year by a young lady investigator from Granada Television. She went there from Manchester because she had been told that children were attending the school from North-West England and that conditions were not satisfactory. She painted a lurid picture to me about it. That was my first knowledge of the existence of the school. Nobody locally seemed to know very much about it, although it is only a mile or so from the village of Thornton, which I know very well.
Subsequent to my discussion of the school with the young lady from Granada, I made an immediate request to the principal of the school, Mr. G. F. Taylor Bryant, to visit the school. My request was readily acceded to, and I visited the school, along with my agent who lives in Thornton, on Sunday, 31st January. What I saw disturbed me quite a bit.
For a long number of years the building was used as a fever isolation hospital. It was subsequently used as an institution for mental defectives and was known at that time as Strathore Hospital. In December, 1964, the mental health subcommittee of the Scottish South-East Regional Hospital Board advised that when the new hospital for mental patients became available in Dunfermline in 1967 Strathore would no longer be needed and a decision had then to be taken as to the future use of Strathore Hospital.
The regional engineer and the regional architect meantime had reported that about £150,000 would be needed to bring the buildings up to modern standards, and in a report dated June, 1965, a copy of which I have with me, the regional architect's division reported, among other things, that the general condition of
452
the buildings was good but 50 per cent. of the sanitary fittings were badly worn ; 70 per cent. of the rooms needed decoration and plaster repair ; the laundry was no longer used as such and little maintenance had been done on it for a long time ; that there was a 58-year-old hand-fired steam boiler which was inefficient and in very poor condition ; that the internal heating system was far below modern standards and
"with reasonable ventilation conditions would be quite inadequate".
Also, the internal electrical system was inadequate in design, although there had been some rewiring to the extent of 75 per cent. in the last few years for the provision of power and light. There was no incinerator. It is a remarkable comment on the way the hospital had been run by a public body for mentally retarded children.
However, the building was vacated by the South-East Regional Hospital Board and remained empty for a considerable time—no doubt the Under-Secretary of State has the exact date—I think from some time in 1967 to September, 1970. In that period, when the buildings were completely empty, the deterioration must have been considerable. Fife County Council considered using it as an agricultural college, I believe. I am not sure about that, but it does not matter for the purposes of the argument. Fife County Council rejected it on the ground of cost ; it would be much too costly to make it into anything of worthwhile use to it.
Subsequently the buildings were advertised, by whom I know not. They were purchased by Mr. Taylor Bryant of Edinburgh, agent and solicitor. I ask the Minister, by whom was the advertising done? From whom was the purchase made? Was it purchased from the regional hospital board, or was the transaction done through the Scottish Office? Did the vendor know to what use the buildings would be put? Did Fife County Council know? Was planning permission needed? Was it sought and was it given by Fife County Council.
I have never said anything personally against Mr. Taylor Bryant, the purchaser. I believe that he is interested in child care work, and I understood him to say that he had done about ten years' child

453
care work, mostly in Devon and Cambridge, but he has no qualifications whatever for the work, either academic or otherwise, and, indeed, he made no claim to them when I spoke to him. He said that he was the administrator of the business, and his plan was to run the place as a private fee-paying school for mentally and socially disturbed children. I will quote from the brochure, which the Minister might have seen—the inspectors must have seen it :
"Corsbie Hall School, Newton Stewart, Wigtownshire Corsbie Hall School, Thornton, Kirkcaldy, Fife"
That is the one in my constituency. There are ambitious and misleading statements in that brochure. The back page relates to the Fife school, and says :
"Corsbie Hall School (Fife) is an annexe to Corsbie Hall School, Newton Stewart, and provides a further 60 places for maladjusted and mentally handicapped boys from 6–16 years of age. It is run on identical lines as Newton Stewart and will in fact be the main administrative centre for the two schools. The new school will have its own psychological testing and assessment unit employing a full-time psychologist, it will also have its own social worker, and both these departments will operate between the two schools. The staff of the new school will consist of Principal, Deputy Head, Psychologist, Qualified Teachers, Matron, Houseparents, Social Worker and Domestic and Maintenance Staff. Opening date 16th September 1970. Fee : …… per annum to include school uniform."
That brochure was circulated to local education authorities throughout the United Kingdom. When I visited the school last January I saw physical improvements in the buildings. A new oil-fired central heating system had been installed. Several new showerbaths and washbasins had been installed. The old hospital wards had been divided into small dormitories each containing four single beds, which appeared to be reasonably clean. Clearly, some money had been spent, and no wonder, because the fees, although not stated in the brochure, are in fact £820 per child, payable by the local education authorities.
When I visited the school last January it had been open only since the previous September, as the brochure says, and I was told that the number of boys was 53. It may be more, or less, at the moment, I think rather less. I was told that 70 boys had been applied for from all over the United Kingdom—from Man-
454
chester, Oldham, Bolton, South Shields, the North and West Ridings of Yorkshire and most Scottish local education authorities. This information was given to me by Mr. Taylor Bryant. The fees were not mentioned in the brochure, but they are £820 a year, with the promise, or threat, of a further increase at an early date, all of which is paid by the local education authorities concerned.
I was given no clear indication of how the boys were selected or graded for the school. I was told that at least two boys were there following court orders. I do not know whether they were mentally retarded, socially maladjusted or what, but they were there. There was a mixture of all kinds of children with I.Q.s ranging from 60 to 100.
So far as teachers are concerned, when I was there I saw a Mr. Sendall, the headmaster, who had arrived about three weeks previously. I asked what qualifications he had and he said that he was a qualified teacher but with no qualifications to deal with this particular type of child. The same applied to other teachers. At least one was not qualified in any way whatever. There was little evidence, so far as I could see, of any written work and, as an ex-teacher, I had some idea of what to look for. There was little evidence of any equipment in the gymnasium, there were few visual aids ; there was no library. There was no visiting psychiatrist, though I was told that a Dr. Evan Jones, of Cupar, was the visiting psychiatrist. There was little evidence, nor is there yet, that he was or is a regular visitor. There was certainly no evidence of a psychologist or of a social worker.
At one point in our conversation I remember that Mr. Sendall, the headmaster, referred to the children as "savages"—those were his words—who engaged in brutal behaviour. He used that language as justification for their use of corporal punishment. I left that school on that Sunday with a heavy heart and with anxieties for the children in that building.
I wrote to the Scottish Department on 2nd February, having telephoned the previous day. I must admit that the Department replied very quickly on 4th February and confirmed that the school

455
had been inspected, as Mr. Taylor Bryant had told me, on Friday, 22nd January, 1970 ; although Mr. Taylor Bryant told me that that was the final inspection before official registration. The letter from the Secretary of State dated 4th February indicated that it was not the final inspection. I quote one sentence from the Secretary of State's letter :
"I do assure you that the need for urgency in dealing with cases of this kind is fully appreciated and I am asking the inspectors to let me have their report as soon as they can."
So, the right hon. Gentleman recognised the urgency of the matter as long ago as 4th February.
I asked the Secretary of State in my letter to get in touch with all the local education authorities in Scotland who had children at that school, but he refused to do that. He said that it was up to local education authorities to satisfy themselves as to the suitability of the establishments to which they were sending their handicapped children.
I wrote a further letter to the Secretary of State on 5th March, and I would draw attention to one part of his reply on 30th March :
"The reports of the inspections show that there are undoubtedly many unsatisfactory features about the school and that much will require to be done both organisationally and structurally before a satisfactory standard is achieved.… My Department has therefore now written to the proprietor setting out in detail the various aspects which should receive urgent attention, and it is intended to carry out a further round of inspections in two or three months time."
I then tabled a Question to the Prime Minister on the general question of mentally handicapped children. Following the oral exchanges in the House, I then received a letter from the Prime Minister on 23rd March. In that letter to me he gave the numbers of severely handicapped children :
"There are estimated to be about 50,000 mentally handicapped children in England and Wales, and about 5,000 in Scotland. About 63,000 children of school age have been classified as educationally subnormal in England and Wales and about 7,500 in a similar category in Scotland."
The right hon. Gentleman went on to deal with the research which had been going on, and ended by saying :
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"As with the mentally handicapped, these special studies "—
he was referring to the studies in 1966 and 1969—
"suggest that there is considerable need for special educational facilities for maladjusted school children which has not yet been met. These findings are proving very valuable in the planning of future developments."
That was helpful as far as it went. I followed that with subsequent Questions to the Secretary of State. On 24th February, 1971, the right hon. Gentleman indicated that there were nine registered independent schools in Scotland with about 430 places for mentally retarded children, one of which—I presume one of the nine, or it might have been in addition—was provisionally registered at that point.
I put a further Question on 17th March, 1971, to which the Answer was that there was still no final decision as to registration.
So, on 23rd June, 1971, I put a further Question on inspection. I was told that substantial progress has been made, that most physical improvements had been completed in the school, although there were still some weaknesses in staffing, and that there would be another inspection in three months. That was the point at which I expressed my anger at the reply, because I recalled the letter of 8th February in which the Secretary of State had said that he recognised the urgency of the case. That was four months before, and there was to be another three months delay before a subsequent inspection. That answer left me—I was going to say speechless with rage, but I am never in that state.
I had also been in touch with the Secretary of State for Education and Science. On 4th March, 1971, I specifically asked the right hon. Lady about English children at this school, Corsbie Hall, and she indicated that at that time there were three local education authorities in England—Manchester, Bolton and Oldham—which had children there with her approval. That conflicted with the information which I had been given by Mr. Taylor Bryant, the principal of Corsbie Hall school. Now, either the right hon. Lady had been misinformed, Mr. Taylor Bryant had misinformed me, or the other English local education

457
authorities had sent children there without Ministerial knowledge or approval. That is not for the Under-Secretary to answer, but I make the point that there was some misleading of somebody somewhere.
The right hon. Lady also indicated that she had sought advice from the inspectorate of the Scottish Education Department, so that Department thought that the school was sufficiently adequate for children to be sent all the way there from Manchester, Oldham and Bolton.
I tabled another Question to the English Minister on 1st April, 1971. In her reply she indicated that seven of the boys placed at the school by English local education authorities had been withdrawn by their parents—apparently the parents had visited the school, found things they did not like, and had withdrawn their children—but that four English local education authorities were still sending pupils to the school. The right hon. Lady said that she was considering the future position.
In early June, following reports that the Secretary of State for Education and Science had advised the English local education authorities to withdraw all their mentally disturbed children from Corsbie Hall School, I tabled a further Question on 10th June to the English Minister. I asked why she had advised these local education authorities to withdraw their children from this school and whether she intended such withdrawals to be permanent, or until such time as the school was brought up to minimum requirements as to premises and staff, and the right hon. Lady replied :
"I reached this conclusion after considering a report by inspectors of the Scottish Education Department. If the situation at the school changes I should naturally be prepared to reconsider the matter."—[OFFICIAL REPORT, 10th June, 1971 ; Vol. 818, c. 352–3.
I am sorry that I am taking up so much time, but I want to get these facts on the record, and if the hon. Gentleman does not have time to reply I hope that he will do me the courtesy of writing to me, because I intend to press this matter to the utmost.
It was the substance of the right hon. Lady's reply which disturbed and angered
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me when I heard the Scottish Minister's reply to my Question on 23rd June. It amounted to saying that although in the view of the English Minister for Education Corsbie Hall School was unfit for English mentally handicapped children, according to the advice given by the Scottish inspectorate it was apparently good enough for Scottish mentally handicapped children.
Presumably the Government were acting on the basis of local education authorities and local authorities having the freedom to do what they liked. Let us remember that that was the philosophy annunciated as soon as the Conservative Government took office. No doubt the Minister was seeking refuge—indeed, he said so—in his reply to my supplementary question by saying that he had no power to direct local education authorities in Scotland to withdraw their children from this school, he could only advise them to do so. He was seeking refuge in Part V of the 1962 Education (Scotland) Act dealing with independent schools.
What action has the hon. Gentleman taken in compliance with Section 112 of that Act which deals with notification to the proprietor of objections about the suitability of the premises, the efficiency and suitability of the instruction and the quality of the teaching? What steps has he taken to ascertain whether the Scottish local education authorities have satisfied themselves about the adequacy of the provision at this school?
What dissatisfied the English Minister which apparently does not dissatisfy the Scottish Education Department? I make no personal charge against the proprietor at Corsbie Hall, nor against anyone running the institution, but I charge the Scottish Education Department with almost criminal complacency in this matter.
The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor): If the hon. Member intends to make that charge, I hope that he will allow me a few minutes in which to reply.
Mr. Hamilton: I shall conclude my speech in half a minute from now. Had the hon. Member not intervened, I should have concluded it.

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I believe that the Scottish local education authorities have failed to discharge their proper responsibilities in dealing with an under-privileged, inarticulate minority in the community. I am firmly of the view that the education of mentally handicapped children must never be left in the hands of private persons who are accountable to no one. The profit motive cannot be absent from the mind of a proprietor, even though it may not be paramount. This is in the nature of a major education scandal which cannot for much longer escape the horror and disgust of the majority of Scottish people.
3.45 a.m.
The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor): In the few minutes left to me I will try to deal with some of the points raised by the hon. Member for Fife, West (Mr. William Hamilton). Dealing first with the legal position, the only statutory control over these schools arises from the requirements of Part V of the Education (Scotland) Act, 1962, that all independent schools with five or more pupils of school age on the roll must be registered with the Registrar of Independent Schools. Registration is in two stages. Before a school can open to receive pupils it must be provisionally registered. Provisional registration is granted unless the premises have already been found unsuitable or the proprietor has been disqualified from being the proprietor of a school. The school remains provisionally registered until the Secretary of State is satisfied that it can have final registration.
The hon. Member has suggested that we have not looked at this carefully. By continuing provisional registration until we are satisfied that this school comes up to the standards needed for final registration we are showing that we are watching the position carefully. The hon. Gentleman is aware that on one visit by the inspector the attention of the proprietor was drawn to certain defects, first to do with building and secondly with staff. On the following visit, some months later, there was a noticeable improvement, drawn to our attention by the inspector. There had been improvements in the arrangements in the school and
460
in the buildings. There were still staffing deficiencies and it was because of this that the final registration has so far been withheld. On the visit at the beginning of June, the inspector found that almost all the recommendations made by him in the previous report for improving accommodation had been attended to, at a fair cost.
Pupils had been divided into three family groups or "houses". Each group is in the charge of "house" parents and it is largely self-contained. In particular, the boys under 12 are in one group. They live, eat, work and play separately from the senior boys. The atmosphere of the school seems much happier and the behaviour of the boys no longer as aggressive as had appeared on the earlier visit. Organised excursions are run at weekends. All this is satisfactory, especially in view of the comparatively short time in which the improvement has been effected. Staffing weaknesses remain and the provisional registration will therefore continue for the present until a further visit by the inspector in September.
The hon. Gentleman has drawn attention to the fact that my hon. Friend the Secretary of State for Education and Science regards this school in a different light from that in which we in Scotland see it, because she has decided not to allow pupils from English local authorities to remain at the school. She has a specific duty, which we do not have, formally to approve the sending of any handicapped pupil to a school which is not either run by an education authority or recognised as efficient by the Department of Education and Science.
In Scotland, thanks to an amendment made by the Education (Scotland) Act, 1969, enacted by the previous Government, the Secretary of State no longer has any comparable power or duty. His responsibility in relation to a school like Corsbie Hall is limited to registration. My right hon. Friend has said that she will review the situation in the light of a decision by us to give the school final registration. In our view the school is still suffering from teething troubles which seem to be surmountable. It has not yet got the quality of staff which we think is needed for a school of this kind but the proprietor is clearly anxious to improve matters. He has already dealt

461
with those matters which can be dealt with quickly. He has advertised, and is advertising, for staff and is offering generous salaries. The accommodation has been greatly improved. The number of pupils is to be limited to 50 and it is intended not to admit boys who are seriously disturbed or of very low intelligence. It—
The Question having been proposed after Ten o'clock on Tuesday evening 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 eleven minutes to Four o'clock a.m.

SOCIAL SERVICES
  Departmental Review
  Departmental Review
  Maternity Grant (Deserted Wives)
  Maternity Grant (Deserted Wives)
  Pensions (Purchasing Power)
  Pensions (Purchasing Power)
  Mentally Handicapped Persons
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  Home Helps (Charges)
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  Pension Order Books
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  Food Poisoning
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  Dental Treatment (Cost)
  Dental Treatment (Cost)
  Montague Hospital, Mexborough
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  Geriatric Cases, Hull
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  Ombudsman (Appointment)
  Ombudsman (Appointment)
  Hostel (Camberwell)
  Hostel (Camberwell)
  Medical Laboratory Technicians (Salary Claim)
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  Family Expenditure Survey
  Family Expenditure Survey
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  Nursing Staff Shortage
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  Rent Allowance
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  Adult Training Unit, Corby

  Benefits (Costs and Charges)
  HEALTH AND PERSONAL SOCIAL SERVICES
  Dental Charges
  In the general dental services, charges for dental treatment (not including dentures) in the year ended 18th June, 1970, represented the whole cost subject to a maximum of £1'50. The rate of charge was reduced in 1971 to half the cost of the treatment, subject to a maximum of £10, with the result that the actual amount payable by patients can be lower or higher than in 1970. Charges for supply of dentures increased by about 25 per cent. in the year ended 18th June, 1970, but the change in charges in the subsequent year varied according to the type and cost of denture supplied : in many cases there was little change.
  Ophthalmic Charges
  In the general ophthalmic service, the charge for a single-vision lens increased by 17½p in the year ended 18th June, 1970, and by between 40p and £1·30, according to the strength of lens, in the year ended 18th June, 1971. The corresponding figures for a bifocal lens were 25p in the year ended 18th June, 1970, and between £1·20 and £2·25. The charge for the most popular National Health Service spectacle frame increased by 4p in the year ended 18th June, 1970; there was no increase during the year ended 18th June, 1971.
  Prescription Charges
  Charges for prescriptions, for elastic stockings and other elastic hosiery were not changed in the year ended 18th June, 1970. In the subsequent year they increased by 7½p, 37½p and 12½ respectively.
  Social Security
  Costs of social security benefits are not available for years ending on 18th June. As regards increases in benefits, national insurance and associated benefits were increased by about 11 per cent. and supplementary benefits by about 5 per cent. in the year ended 18th June, 1970. Supplementary benefits were increased by about 8" per cent. in the year tended 18th June, 1971. Additionally, in that year pensions were provided for the over-80s and benefits for widows were improved.

  Benefits (Costs and Charges)
  Hospital Waiting Lists
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AGRICULTURE, FISHERIES AND FOOD
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  Housing Improvement Grants
  Dilapidation Schedules
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  Leaseholders (Harassment)
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  Train Drivers
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  PRIME MINISTER (CORRESPONDENCE)
  EUROPEAN ECONOMIC COMMUNITY
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  HOSPITALS FOR THE MENTALLY HANDICAPPED
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  LIVERPOOL
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  EDUCATION (CO-ORDINATION OF DEPARTMENTS)
  EDUCATION (CO-ORDINATION OF DEPARTMENTS)
  THE NORTH-WEST
  THE NORTH-WEST
  SHOPLIFTING CASES
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FOREIGN AND COMMONWEALTH AFFAIRS
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  Hong Kong (English Langauge Schools)
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POSTS AND TELECOMMUNICATIONS
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  Price Increases
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  Gas Appliances (Conversion to Natural Gas)
  Gas Appliances (Conversion to Natural Gas)

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 Chichester):
The LORD CHANCELLOR on the Woolsack.

SELECTIVE ENTRY IN SURREY SECONDARY SCHOOLS
LORD GARNSWORTHY: 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 educational reason influenced the decision not to approve the proposal of Surrey County Council to abolish selection for admission to secondary schools in the area of Walton-on-Thames and Hersham in Surrey.]
THE PARLIAMENTARY UNDERSECRETARY OF STATE, DEPARTMENT OF EDUCATION AND SCIENCE (LORD BELSTEAD): My Lords, I apologise for the length of this reply. On June 18, 1971, my right honourable friend approved Surrey's proposal, submitted under Section 13 of the Education Act 1944, to change the character of Rydens Secondary School so that it should become comprehensive and admit pupils at age 13 without reference to ability and aptitude. The Surrey Authority had given notice of their intention of ending the 11-plus selection arrangements for children living in the area to be served by the Rydens School. The effect of this would have been to withdraw from pupils in the area any opportunity of qualifying for a place in either a maintained grammar school or a non-maintained grammar school at which Surrey take places.
My right honourable friend received complaints from parents about the Authority's decision and she concluded that their proposed arrangements were unreasonable because they had the effect of eliminating all choice of school for those children who might qualify for a grammar school place. The factors which my right honourable friend took into account
180
included the nature of the area, the schools available, the possibility of some parents wanting to send their children to denominational and single sex schools, and the fact that the Authority's arrangements made no provision for any exceptions. Accordingly my right honourable friend directed the Authority under Section 68 of the 1944 Education Act to modify their arrangements to as to enable children living in the area to be served by the Rydens School to take part at their parents' request in the Authority's arrangements for the selection of candidates for grammar school places.
LORD GARNSWORTHY: My Lords, while thanking the Minister for that lengthy reply—and since it is so lengthy I hope the House will be a little indulgent—may I ask whether he could tell the House, since the proposal to abolish selection at Walton and Hersham in 1971 was specifically set out in the declaration of intent as approved by the County Council in 1967 and accepted by the then Secretary of State, how it can now be regarded as unreasonable of the County Council to wish to implement that policy, having regard to the fact that they have already begun to implement it at Frimley and Camberley, and especially in the light of Circular 10/70, which was supposed to make authorities freer to determine the shape of secondary provision in their areas?
LORD BELSTEAD: My Lords, the proposal which the Surrey Education Authority published required approval by the Secretary of State under Section 13 of the Education Act 1944, and in fact the proposals have received approval from my right honourable friend. The special proposals by the education authority to exclude children in this area from taking any entrance examinations set for children outside the area did not form part of these proposals, and did not form part of my right honourable friend's decision under Section 13. They formed part of a direction under Section 68.
LORD JANNER: My Lords, in view of the reply that has been given to your Lordships and the attitude that has been adopted by the Secretary of State, would the noble Lord say whether the Secretary of State is in fact saying that she will not approve any proposal to end selection and eliminate separatism? Does it mean that

181
she will insist upon the retention of grammar schools whenever reorganisation proposals are submitted?
LORD BELSTEAD: My Lords, my right honourable friend will decide on Section 13 proposals on their merits in each individual case.
LORD GARNSWORTHY: My Lords, while appreciating what the Minister said in reply to my Question, may I ask him whether he is aware that the County Council has already begun the abolition of selection and separatism at Frimley and Camberley? While I am fully aware of the use that has been made of Section 68 of the Act (which is rather unusual), I wonder whether he will tell us where, under Sections 6, 17 and 57, as stated in the letter from the Department, the county are in any way at fault?
LORD BELSTEAD: My Lords, the letter which was sent to the Authority by my right honourable friend referred to Section 8 of the Education Act, which deals with providing schools "sufficient in number, character and equipment" to provide suitable education for the different ages, abilities and aptitudes of pupils. Section 17 refers to articles of government, which of course contain provisions about admission arrangements for schools, and Section 37 refers to school attendance orders. Section 6 of the 1953 Act is the section which refers to local education authorities being empowered, if they wish, to take up places at direct grant schools and also at independent schools. I leave to the judgment of your Lordships the reasons why my right honourable friend took the decision she did in the light of the extremely long Answer which I gave at the beginning of this exchange.
LORD GARNSWORTHY: My Lords, may I ask the Minister whether he will draw the attention of his right honourable friend the Secretary of State to the very bad Press she has had with regard to her decision, and in particular to The Times Educational Supplement of July 2, in which the views of the noble and learned Lord the Lord Chancellor, when he was Minister of Education in 1957, appeared to be completely at variance with the action she has now taken?
LORD BELSTEAD: My Lords, I think that if the noble Lord will look at Circular 10/70, which my right honourable friend issued soon after June of last year, it will be seen that it is felt that there should be freedom—or rather more freedom; the word used was that it should be "freer"—for people to decide on education. This includes parents as well as elected representatives.
LORD GARNSWORTHY: My Lords, this is very important, and it is a matter of national importance, not purely local. The noble Lord has just said that Circular 10/70 said that people should be freer. Paragraph 2 states—
SEVERAL NOBLE LORDS: Order!
THE LORD PRIVY SEAL (EARL JELLICOE): My Lords, I think the noble Lord has had quite his fair share of supplementaries, if I may say so. I should not wish to deny him another, but could he perhaps phrase it in an interrogatory manner?
LORD GARNSWORTHY: My Lords, I am grateful to the noble Earl the Leader of the House for drawing the point to my attention, and I apologise if, because of the involved nature of the subject, I did not follow the usual form. May I ask the Minister whether he is aware that the article in The Times Educational Supplement to which I have referred said:
"As he saw it, the Minister should not override an education authority even when he thought they were wrong, unless he is convinced that they have not fairly considered the case or that their decisions are not merely wrong but perverse."
Will he please convey that to his right honourable friend?
LORD BELSTEAD: My Lords, I have given the noble Lord references and full explanations of the sections in the Acts under which my right honourable friend felt that she must direct the education authority. I think I can do no more than that.
LORD BESWICK: My Lords, the noble Lord said that his right honourable friend would judge each case on its merits. He also said that included in the merits was the nature of the area. Would the noble Lord be good enough to tell us something about the nature of this particular

183
area which justified segregation?
LORD BELSTEAD: My Lords, the reference to the "nature of the area" was, I think, to the ease of travel in the area; and of course careful note is always taken of the number of pupils who may not go to the school, which has in this case been approved as a new comprehensive school.
BARONESS GAITSKELL: My Lords, is it not true that in the Secretary of State's own constituency the authority has not answered her clarion call for freedom but has gone ahead with its own plans for comprehensive education?
SEVERAL NOBLE LORDS: Answer!
LORD BELSTFEAD: My Lords, I should be delighted to answer that question. The House went into this matter at great length on an Unstarred Question raised by the noble Lord, Lord Silkin, nearly a year ago, when it was my pleasure to be able to point out to the House that comprehensive education, singularly successful in many areas of this country, has been divided between authorities—some Conservative, some Labour and many independent.

NORTHERN UNIVERSITIES' ENTRANCE STANDARDS
2.40 p.m.
BARONESS SUMMERSKILL: 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 why the Northern univerities ask for a higher standard for girl applicants to the medical schools than for boys, as revealed in the Leeds Medical Faculty prospectus, which states that boys will be expected to obtain three Grade "C" passes at "A" level (or better) while girls must obtain two Grade "B" passes and a "C" (or better).]
LORD BELSTEAD: My Lords, the admission of students is a matter for the individual universities. I understand that the Leeds Medical Faculty have resolved during the present session that
184
the sole criterion for selection should be suitability for the medical course, irrespective of sex.
BARONESS SUMMERSKILL: My Lords, is the noble Lord aware that he has not denied the information I have given? Is not he aware that to-day we are very short of doctors, that we are compelled to take them from Pakistan and India, where they are very much needed? Is it not a most short-sighted policy for the Government still to continue this discrimination against able girls?
LORD BELSTEAD: My Lords, I entirely appreciate both the experience and the strength of feeling from which the noble Baroness speaks. The noble Baroness knows better than I not only the extent of the shortage but the effect it has. I would not diagree with her on that. I would certainly disagree when she talks about Goverment policy. I think I answered that part of the supplementary question in my original Answer.
BARONESS SUMMERSKILL: My Lords, would not the noble Lord agree that it must surely be Government policy if we are so short of doctors that we have to take Commonwealth doctors from those countries? If he is so sympathetic will he also see to it that the London medical schools increase the number of women they are prepared to take, which at the moment is a small percentage of the whole? Is not this also most stupid, prejudiced and discriminatory?
LORD BELSTEAD: My Lords, the numbers in the London medical schools are rising. I think all your Lordships would hope, with the noble Baroness, that these figures might continue to reflect the decision which Leeds has in fact taken.
LORD GARDINER: My Lords, are not these practices in fact a breach of the Sex Disqualification (Removal) Act? If the noble Lord cannot answer that question to-day, would he be kind enough to write and let me know on what grounds they are not?
LORD BELSTEAD: My Lords, I think I can give this answer to the question which the noble and learned Lord has asked me. I would be advised, I think, that if there were any contravention of the Sex Disqualification (Removal) Act 1919, it would not be for Her Majesty's

185
Government to enforce the law, and that the remedy for any woman aggrieved would be by way of civil injunction. I know this is not quite a direct answer to the noble and learned Lord, but I am afraid it is the best I can give this afternoon.
BARONESS EMMET OF AMBERLEY: My Lords, may I ask, in support of this Question, whether in due course, when the noble Lord has had time to gather the information, we could have a report on the conditions regarding the admission of women to the medical degrees of our various services?
LORD BELSTEAD: My Lords, I have figures here, but I do not think they fully answer the noble Baroness, and if I may, I will write to her. If the noble Baroness wishes to press me, I have certain answers, but I do not think they provide the global total she is asking for.
LORD PLATT: My Lords, are Her Majesty's Government aware that, as I have said before in this House, the number of foreign doctors from India and Pakistan and other places is not a fair index of the shortage of medical men in this country? The position is greatly complicated. The majority of these doctors are holding only temporary posts, and if you were to qualify enough people to fill all those posts with British people they would be out of work for most of the rest of their lives.
LORD BELSTEAD: My Lords, I am grateful to the noble Lord for giving his expert advice in question form to the House. It might interest the noble Baroness, Lady Emmet, that the total number of medical school places has increased from 2,020 in 1961 to 2,873 last autumn, and plans have been announced in Parliament for continued expansion to over 4,000 by the late 1970s. I give that information in conjunction with what the noble Lord has just said.
BARONESS SUMMER SKILL: My Lords, can the noble Lord amplify that information? There are 2,000 places for women. How many are there for men?
LORD BELSTEAD: My Lords, that was not the figure I gave.
BARONESS EMMET OF AMBERLEY: My Lords, can the Minister make quite
186
clear whether the figure he has given is for women applicants or for total applicants?
LORD BELSTEAD: Total.
BARONESS WOOTTON OF ABINGER: My Lords, may I ask the Minister what his reaction would be if the Northern Universities set out in their prospectuses that higher entry qualifications would be required from coloured applicants than from white, and what would be the difference between that type of discrimination and this?
LORD BELSTEAD: My Lords, I think that is a little wide of the original Question.
BARONESS SUMMERSKILL: My Lords, may I ask the noble Lord why the Government feel so strongly about colour discrimination and prejudice, and why they do not feel so strongly about sex discrimination and prejudice?
LORD BELSTEAD: My Lords, I am not aware that I have given any opinion about colour discrimination and prejudice.
BARONESS SUMMERSKILL: My Lords, it is in the papers every day.
LORD SHACKLETON: My Lords, although the House thinks that the Minister is batting manfully on an impossible wicket, would he consider preparing a statement which bears on the specific point of my noble friend's Question, as to why this discrimination is acceptable and whether the Government ought not to have a view on it?
LORD BELSTEAD: My Lords, I am in the fortunate position to-day of being able to read up a Question and the answers given by the noble Baroness, Lady Phillips, for whom I have the greatest admiration, at the time of the last Government. This is why I was delighted to be able to say, at least to my noble friend, that the numbers planned for the 1970s show a considerable lightening of the situation, and to be able to assure the noble Baroness, Lady Summer-skill, that we agree with her in principle and sympathetically.
BARONESS BURTON OF COVENTRY: My Lords, would the noble Lord be equally delighted to answer a very simple

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question to which I have not heard the answer. I believe he told the noble Baroness, Lady Emmet of Amberley, that there were 2,000 vacancies for medical students this year. Could he tell us how many of those are for women?
LORD BELSTEAD: My Lords, I am sorry; I do not think I can at the moment. I have papers, but I am becoming increasingly muddled with them. If I may, I will write to the noble Baroness.
BARONESS BURTON OF COVENTRY: My Lords, could the reply to my question be circulated in the OFFICIAL REPORT?
LORD BELSTEAD: My Lords, if a Written Question is put down by the noble Baroness, most certainly. I have no wish in any way to dodge this issue. If the noble Baroness would like to table another Question, I shall of course be here to reply.
LORD SEGAL: My Lords, can the noble Lord inform the House whether many outstanding candidates, regardless of sex, are still being rejected by medical schools owing to the inadequate number of places available for entrants?
LORD BELSTEAD: My Lords, I am sorry, but I think we are getting a little wide of the original Question.
LORD SLATER: My Lords, is the noble Lord not aware that the very fact that this Question has been tabled, and has led to so many supplementaries shows that, although one was of the opinion that all major Parties believed in freedom of opportunity and equality, it seems from the action of the present Government, and of previous Governments also, that that line of approach has not been taken? Does this matter not warrant further consideration, to bring about this equality of opportunity?
LORD BELSTEAD: My Lords, I will certainly draw the attention of my right honourable friend to what has been said in the House to-day.

OVERCHARGING OF FOREIGN VISITORS
2.48 p.m.
LORD SEGAL: 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 means of redress are available for those foreign visitors who are grossly overcharged during their stay in this country.]
LORD DENHAM: My Lords, if a visitor is charged more than the provider of the goods or services is legally entitled to demand he has the same legal remedies as are available to a British subject. These include the right to refuse to pay the excess.
LORD SEGAL: My Lords, I thank the noble Lord for that reply. Is not this really a question of private enterprise gone mad? Here are the Government doing their best to get this country into Europe, while allowing private individuals to do their best to keep Europe out of this country.
LORD DENHAM: My Lords, there is of course no machinery for limiting prices, except where there is a statutory limit.
LORD BROWN: My Lords, would it not be possible to draw the attention of the British Tourist Authority to the possibility of considering setting up some channel which could be used by foreign tourists to ventilate grievances they have in this respect?
LORD DENHAM: My Lords, the British Tourist Authority is primarily a promotional organisation and is not geared for receiving complaints.
LORD SHACKLETON: My Lords, may I ask the noble Lord if he will ask the British Tourist Authority whether they consider themselves geared to help in this matter? I think he will get a different reply from the one that he gave to us.
LORD DENHAM: My Lords, I should be rather surprised if I did, but I will certainly set that line of inquiry in motion. There are one or two things that are open equally to residents in this

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country and tourists from overseas if they feel that the law has been broken in any way: they can go to the Citizens' Advice Bureaux, or they can go to the police.
LORD PEDDIE: My Lords, would the noble Lord kindly give some indication of the nature of the legal restrictions upon unduly high prices, to which he made reference in his original reply?
LORD DENHAM: Yes, my Lords. The legal restrictions would be, as I see it, about four in number. The first is where there is some agreement as to price before the actual sale takes place. If this agreement is broken, a civil action for breach of contract would be possible. Secondly, there are various statutory limitations in price, such as taxi fares in London. Thirdly, there are cases where possibly there has been a misleading description; and, fourthly, there are cases where there is some sort of deception, such as the wrong change being given.
BARONESS GAITSKELL: My Lords, would not the noble Lord agree that British visitors on the Continent of Europe are just as liable to be overcharged as foreign visitors over here?
LORD DENHAM: Yes, my Lords; I am very grateful to the noble Baroness for bringing up that point.
LORD SEGAL: My Lords, would it not be of considerable help if this information, giving also the maximum charges, were displayed on a notice in every hotel bedroom in this country, so that foreign visitors will know what remedies they have against such instances of overcharging?
LORD DENHAM: My Lords, the Development of Tourism Act 1969 makes provision for both the displaying of prices and the registration of hotels, but an Order in Council would be needed to bring the relevant sections into effect. I am advised that if they were brought into effect the registration would have to come first, and the British Tourist Authority are at the moment examining the criteria for such registration.
LORD SEGAL: My Lords, is it not high time that such an Order in Council was introduced? Is the noble Lord aware that many visitors to this country are reluctantly forced to sleep out because
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they cannot afford the high charges made to them in this capital City of London?
LORD DENHAM: My Lords, I cannot comment on the second part of the noble Lord's question, except to say that obviously all of your Lordships will agree that gross overcharging is intolerable and should not take place. But I cannot commit my right honourable friend as to whether these two sections of the Development of Tourism Act will be brought into effect, and he has not yet had any advice from the British Tourist Authority.

HOUSING FINANCE
EARL ST. ALDWYN: My Lords, with the leave of the House my noble friend Lord Sandford will be making a Statement on housing finance in England and Wales at a convenient moment after 3.30 p.m.

TRIBUNALS AND INQUIRIES BILL [H.L.]
2.54 p.m.
THE LORD CHANCELLOR (LORD HAILSHAM OF ST. MARYLEBONE): My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3a. —(The Lord Chancellor.)
On Question, Bill read 3a.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, as an Amendment to Schedule 3:
Page 22, line 18, at end insert—
("THE LAND COMPENSATION ACT 1961
(9 & 10 Eliz. 2 c. 33)
In section 21(1) of the Land Compensation Act 1961 for the words "the Tribunals and Inquiries Act 1958" there shall be substituted the words "the Tribunals and Inquiries Act 1971 (or any enactment replaced thereby)".")
The noble and learned Lord said: My Lords, I beg to move the short Amendment standing in my name. It is necessary because of a draftsman's slip. Schedule 3 to the Bill contains consequential Amendments of the kind usually found in Consolidation Bills whereby references to other Acts in the consolidating provisions are translated into references to the corresponding provisions of the Bill. Another enactment requiring translation has come to light, and this Amendment adds it to the Schedule. The

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noble and learned Lord, Lord Gardiner, has asked me about the phrase at the end of the Amendment,
"(or any enactment replaced thereby)".
The answer to that is that it is to save pending appeals. My Lords, I beg to move.
LORD GARDINER: My Lords, I wonder whether the noble and learned Lord the Lord Chancellor will be good enough to add something with reference to the words in brackets. This is an ordinary Consolidation Bill; it contains in Clause 18(1) the ordinary clause,
"The enactments specified in Schedule 3 to this Act shall have effect subject to the amendments there specified, being amendments consequential on this Act."
There are many examples in the Schedule, and what is done in every case is that where in an Act there is a reference to the former Tribunals Acts, which are now to be replaced by this Act, such reference is to be read as referring to this Act. That we all understand. One was overlooked, and I quite understand that. So far as it says,
"In section 21(1) of the Land Compensation Act 1961 for the words 'the Tribunals and Inquiries Act 1958' there shall be substituted the words 'the Tribunals and Inquiries Act 1971'",
that is what is done in every other case. The additional words,
"(or any enactment replaced thereby)"
are puzzling to understand. "Thereby" must be borne by the 1971 Act, and not by the Compensation Act. I still do not understand, whether there are pending appeals or not, why it is necessary to put into the Land Compensation Act 1961 a reference to any Act which is replaced by the Tribunals and Inquiries Act 1971.
THE LORD CHANCELLOR: My Lords, I thought I had explained that. This is not the only occasion, even in this Consolidation Bill, where there occurs the formula which the noble and learned Lord is asking about. If he will look at page 22 of the Bill he will see that the third item down between the lines 20 and 25 contains two such references. As I said, it is a device by the draftsman whereby the Act can come into force at once point of time. There are a number of pending appeals under the Act of 1958, which is what was referred to,
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and that saves the Act of 1958 for the purpose of pending appeals. I thought I had made that plain.
On Question, Amendment agreed to.
THE LORD CHANCELLOR: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill do now pass.—(The Lord Chancellor.)
On Question, Bill passed, and sent to the Commons.

PREVENTION OF OIL POLLUTION BILL [H.L.]
Read 3a, and passed, and sent to the Commons.
RURAL WATER SUPPLIES AND SEWERAGE BILL
Read 3a, and passed.
NATIONAL INSURANCE BILL
Read 3a, and passed.

INDUSTRIAL RELATIONS BILL
3.1 p.m.
THE MINISTER WITHOUT PORTFOLIO (LORD DRUMALBYN): My Lords, I beg to move that this Bill be now further considered on Report.
Moved accordingly, and, on Question, Motion agreed to.
Clause 106 [Complaint to industrial tribunal of unfair industrial practice under s.5 or s.22]:
LORD STOW HILL LORD STOW HILL moved Amendment No. 85A:
Page 81, line 7, after ("be") insert ("reinstated or").
The noble Lord said: My Lords, perhaps I may discuss with this Amendment the next Amendment, No. 85B, which goes with it. The object of this Amendment is to include, among the recommendations that the industrial tribunal can make when it is dealing with a claim for unfair dismissal, reinstatement as an alternative to re-engagement. I feel I should apologise to the House for asking

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your Lordships to consider again a question which you considered fully in Committee. I do so only because, having carefully read the Report of the speeches and having considered the arguments, I feel that the answer given from the Government Front Bench did not quite deal with the case that was made in support of this Amendment. It was a very courteous and careful answer, but I think it left the case not wholly disposed of.
I do not want to go over again the broad arguments in favour of the proposal. May I summarise them, however, by saying that I think it will be within everybody's experience that, if a man has been dismissed from his employment, it is not necessarily compensating him adequately to re-engage him. A man, or a woman, may work for years and years faithfully serving those who employ him, achieving status, attracting confidence and gaining the esteem of his fellow workers and of his employers. He is then, in the assumed circumstances, unfairly dismissed and the question arises: if he can show that he has been unfairly dismissed, how should he be treated by the tribunal which deals with his case for the purpose of reimbursing him for the loss he has sustained?
The structure of Clause 106 in which I seek to make this change is as follows. It deals with claims under Clauses 5 and 22, and Clause 22 deals with the case in which a dismissed worker brings a complaint before an industrial tribunal, complaining that he has been unfairly dismissed. Subsection (4) of Clause 106 assumes that the complaint has been made out and it then specifies what the tribunal can do. One of the powers which is vested in the tribunal is the following. The tribunal may, if it
"considers that it would be practicable, and in accordance with equity, for the complainant to be re-engaged by the employer…make a recommendation to that effect, stating the terms on which it considers that it would be reasonable for the complainant to be so re-engaged or engaged."
If one looks at Clause 115, one finds that if subsequently it is brought to the notice of the tribunal that the recommendation has for no adequate reason not been complied with by the employer, it can correspondingly increase the compensation which it would otherwise have been disposed to award. In a sense, I suppose the increase is intended as a kind of puni-
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tive increase upon the basis that the employer has acted wholly unreasonably.
I have foreshadowed the case that I seek to put before the House in support of this Amendment and, as I said, it is that the tribunal should be entitled to recommend that the worker should be either re-engaged—and by "re-engaged" I take it is meant taken into employment in some post or other, with the same employer or with a successor of the employer, but not necessarily in the same post from which he was dismissed—or reinstated that is, to be accorded again the full position from which he was dismissed, carrying with it all that he had won over the years by his loyal service in that post.
I do not think that is an argument which gains strongly from repetition or elaboration. It is a simple point; it has absolutely no Party content whatever, and I should have thought that noble Lords on both sides of the House would find that no conceivable element of doctrine could separate them in their approach to a matter of that sort. This Amendment is simply an effort by those who with me propose it, to see that full justice is done to a worker who, in the assumed circumstances, can show not only that he was dismissed but that he was unfairly dismissed. Once he can show that he has been unfairly dismissed and has established that to the satisfaction of the tribunal, surely the tribunal should be given powers completely to reimburse him for the loss not only in terms of finance, but also in terms of status and dignity, which he has undergone as a result of the assumed wrongful act of his employer. My Lords, I beg to move.
LORD PARGITER: My Lords, I have one question which can perhaps he answered at the same time. What will be the position of a person in an occupational pension scheme perhaps run by an insurance company, or alternatively in a non-contributory scheme run by the firm? If a person is dismissed, then presumably he is not entitled to anything if the scheme is a non-contributory one. If it is a contributory one, perhaps run by an insurance company, he may have his contributions returned to him. But it seems to me very doubtful that he will be reinstated in the pension scheme if he is re-engaged. This is a most important point. If a man is reinstated the position

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is perfectly clear, but if he is re-engaged the position is not so clear. The tribunal may say that a person's pension should be unaffected, but if an insurance company is involved that may not be so easy. A person ought not to be under any penalty, or implied penalty, if he has been wrongfully dismissed. So I hope that the noble Lord will give consideration to that point.
LORD SLATER: My Lords, I was interested in the case that my noble friend Lord Stow Hill put forward when moving this Amendment. He suggested that the Court should make reasonable recommendations and that those recommendations should be accepted. My reason for supporting this Amendment is that I happened to occupy a position in which I had to give every consideration to recommendations placed on my desk for dismissal of workers. This was when I was at the Post Office as a junior Minister. The recommendations used to come up through the machinery to my desk and they were not always recommendations of dismissal for something that had happened in the work of the Post Office but for something which had happened outside that employment. I remember a particular case which came before me and which went before a sheriff court in Scotland. Two individuals had committed some offence outside Post Office work for which the sheriff imposed his judgment, but he added a rider to the effect that he sincerely hoped that the Post Office would not seek to dismiss those men from its service.
The recommendation for dismissal came to me because the Department said, "We cannot have these people in the service, because they will be engaged in an office of trust." In the capacity I held at that time I came to the conclusion that the sheriff had had some specific reason for making his recommendation or he would not have made it. Therefore I could not in any circumstances accept the recommendation coming from my advisers that the men should be dismissed, and I did not dismiss them. They were kept in the service. In all probability, if I had accepted the recommendation by the Department, as has been suggested by my noble friend Lord Pargiter, those men would have gone on to the open market to seek further employment,
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but the Post Office could not have given them a reference, even if they were able to find other employment, because they had been dismissed from the service. Not only that, but, as my noble friend said, they would also have lost an amount of money which would have come to them if they had not suffered this form of dismissal affecting pension and gratuity rights. Therefore I sincerely hope that on this Amendment, proposed by my noble friend Lord Stow Hill, and supported by Lord Pargiter, the Minister will see that its acceptance could avoid a great deal of difficulty which could be caused if a man was dismissed in this way and lost his employment and then society had to keep him by means of social security benefits.
3.13 p.m.
LORD BROWN: My Lords, I am sorry to take up further time of the House, but there are many angles from which this Amendment can be supported and I see no harm in adding to the arguments in favour of what I regard as an important Amendment. One of the things I have objected to strongly about the law is that if a person is convicted of a crime and then found to be innocent of it he is pardoned, but if one has a commercial contract and breaches it, then goes to the courts which decide that it has been breached, one is not invited to write a new contract with the other party but is able to get back inside the terms of the original contract. Admittedly this Bill refers to "unfair dismissal", which involves the idea that the person has been already dismissed, but the Bill and the code of industrial relations are full of references to the contract of employment. If a man is held subsequently to have been unfairly dismissed, then the original contract stands and the word "reinstate" seems to be the appropriate word to use in those circumstances. This is a legal argument and no doubt I may be shot down by some of my noble and learned friends and I may be at risk in treading on legal issues, but I believe that there may be a point here.
While I am on my feet, may I yet again draw attention to the fact—this is not quite relevant to the Amendment—that in dealing with the question of dismissal I do not think a sufficient amount of objective thought has been brought to play on the whole issue. I believe we still stand in

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a situation in which there is no discrimination in the Bill between dismissal from a company, the total employment organisation, and dismissal from a role within the organisation, with the possibility of being transferred to another role. If the courts are not guided on this question before the cases begin to arrive, they will be in great difficulty. It is one thing to be dismissed from a company and quite another thing to be dismissed from a role and offered some other role within the company which one may or may not take. I am sorry to drag this matter in, but it has a bearing on the question of reinstatement. I hope that the Minister will consider these two Amendments on the basis of the four different sorts of argument which have been put forward in support of them.
3.16 p.m.
LORD DRUMALBYN: My Lords, the noble Lords who have spoken have all done so very persuasively and I should start by saying that we have great sympathy with what they have said. We have looked again at the subsection, but we are still, I am bound to tell noble Lords, of the view that no change is necessary. Our intention here was to provide for both reinstatement and reemployment of the employee, provided that an adequate alternative to his old job were available. We think that within the term "re-engagement" is included "reinstatement". Under the subsection, as the noble Lord, Lord Stow Hill, has said, the tribunal will be able to recommend full reinstatement where it considers the remedy both practicable and equitable. The reason for this is that under subsection (4)(b) the tribunal is required to make a recommendation and to state the terms on which it considers it would be reasonable for the employee to be re-engaged. That means, quite simply, that the tribunal is given very wide discretion between what some noble Lords think altogether full reinstatement, which probably is different from reinstatement, and the minimum of re-engagement. So it will be appropriate, in any case where a tribunal thinks it to be so, to recommend that an employee be given his old job back on such terms as if the dismissal had never taken place.
The difficulty about the word "reinstatement" is simply this: that it has not any clear sense. "Re-engagement"
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has, but "reinstatement" has no clear sense. There are several meanings that can be applied to it. It can mean re-engagement with retrospective effect to the date of dismissal; it can mean re-engagement in the position which the employee had at the date of dismissal but without retrospective effect; it can mean re-engagement in the position which the employee held at the date of dismissal, or re-engagement in that position without retrospective effect and also it can mean that if in the meantime he would have been promoted to a higher position, re-engagement at that higher position. It has all these various meanings; and the word, I am informed, is not a word that is used at the present time in legislation except in the Title of legislation or in the rubric. It does not appear, I am told, in the text of legislation at the present time. So it has no clear meaning. But what I would assure noble Lords is that what I have said is the intention, and we believe that this will be the effect. It will be within the competence of the tribunal to recommend re-engagement, using its discretion in the light of the conduct of the parties, and in the light of the practicalities of the situation to recommend all of these things: reinstatement in the very fullest possible sense of the term, or simply re-engagement in another job, which is obviously not reinstatement. So the word "re-engagement" covers reemployment in a different job all the way up to full reinstatement, and for those reasons we are entirely at one with the noble Lord in his intentions. We think they are achieved, and therefore we do not think that this word should be added. I would only add that, if it were, it would cause a good deal of redrafting difficulties right throughout the Bill. Does the noble Lord want to ask a question?
LORD SHINWELL: My Lords, I will not trouble to make a speech. Would the noble Lord agree that if he were to add a proviso to the term "re-engagement" on the lines of what he himself has said in the course of his speech—namely, that it might not mean the same job, and that kind of thing, but it would not in any way adversely affect his pension and other rights—it would make all the difference? He might consider that.
LORD DRUMALBYN: My Lords, I made a gesture as if I was going to sit down, I admit, but I then remembered

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I had not dealt with this particular point. At the Committee stage noble Lords expressed their concern that there should be full reinstatement. As I have already said, it is our advice that subsection (4) is sufficiently widely drafted in lines 10 to 13 to enable the tribunals to make recommendations on these matters. But I ought at the same time to make it clear to your Lordships that questions relating to the preservation of pension rights are in rather a different category. They will depend to a considerable extent upon the rules of a particular pension scheme, and will largely be out of the orbit of the tribunal recommendations. I would myself imagine that if, in a particular case, the tribunal desired to make the fullest reinstatement and it were possible under the pension scheme, then it might include that in the terms, but I am afraid I could not say more than that on that point.
My Lords, perhaps I should just refer, in closing, to what the noble Lord, Lord Slater, said and what the noble Lord, Lord Brown, said. The noble Lord, Lord Slater, was very interested indeed about a particular case which came to him when he was Assistant Postmaster General. But, really, it is difficult to bring what he was talking about there into line with what we are talking about here, because the essence of the case that he was talking about is that the men were in fact not dismissed. He asked, therefore, rather hypothetical questions about a different case, and I do not think I could answer those. I hope I have dealt with the point made by the noble Lord, Lord Pargiter.
LORD PARGITER: At an appropriate time, I should like to ask a question.
LORD DRUMALBYN: Then I will come back to that. So far as the noble Lord, Lord Brown, is concerned, he said—and this was really his main point—that "reinstatement" is the appropriate word to use. I hope that I have demonstrated to him that this is just not so. If it were, we would certainly have used it. Does the noble Lord, Lord Pargiter, want to come back?
LORD PARGITER: I am grateful to the noble Lord. As I appreciate, there are circumstances in regard to pension schemes which would make for difficulties, but the point I had in mind was
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that reinstatement would imply so far as the employer was concerned all the legal responsibilities of replacing a man and restoring the status quo. I appreciate that it might not be possible to do that with an insurance company. In fact, if the tribunal made an order which affected an insurance company there might be difficulties; but that would not absolve the employer from making the equivalent reinstatement of the man so far as his pension rights were concerned. That is why I am very much concerned about it.
LORD DRUMALBYN: My Lords, I can understand the noble Lord's concern, but I am afraid it is not a matter I can go into detail about here, because even although the word "reinstatement" was put in here it would not alter the situation.
LORD POPPLEWELL: I think most noble Lords will be very concerned about the reply given by the noble Lord, Lord Drumalbyn, when he states quite frankly that it is the intention of the Government that re-engagement and reinstatement, according to the Government's view, amount to the same thing.
LORD DRUMALBYN: No.
LORD POPPLEWELL: They were the noble Lord's words. He said the intention was to include both.
LORD DRUMALBYN: No, my Lords. I said that re-engagement included reinstatement and re-employment.
LORD POPPLEWELL: This adds to the confusion that is in the Bill. The noble Lord went on to say that there was no objection in principle but it would create a lot of trouble now to amend the Bill to cover these points. Surely this is an admission. If the Government feel, as we are advised, that this is a legitimate Amendment to ensure that the man gets his job back again—and this is very important—and the reason why it is not acceptable is because it is too much trouble to alter the Bill, surely this indicates a weakness which we really ought to put right. It does not matter what we say in this House; it does not matter what is said in the other place with regard to the meaning of any Bill. The ultimate decision is what is actually written down in the Bill when it comes to be operated outside.

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Most of us who have had some experience have defended people who have had their services dispensed with. Sometimes we have got them back into their old job and at other times we have not, but have got them back on a lower wage scale or with them losing the benefits, as indicated by my noble friend, Lord Pargiter—pensions and sickness benefit, and other things. If a man is proved innocent of these unjust practices, surely, now that we are passing this Bill, it is our duty to see that he does not suffer any loss at all, but that he goes back to his old job and to the old "perks" that are attached to it. This must be part of the thing that we have to put right. We must ensure that the meaning is there when this Bill becomes an Act.
THE EARL OF BALFOUR: My Lords, as the noble Lord, Lord Popplewell, has just stated, I think this is very important. Although we can get somebody back into his old employment, we cannot necessarily always guarantee getting him back his old job. I think this is where the real importance of this phrase comes in. We can put in legislation that a man must be re-engaged if it is at all possible, but we cannot put in legislation that he must be reinstated. I think, my Lords, that this is really the crux of the whole matter.
3.29 p.m.
LORD BERNSTEIN: My Lords, the noble Earl who has just spoken evidently forgets what this clause is about. It is about a complaint being considered under this clause relating to a dismissal, and the suggestion is that the complaint is well-founded. That is what we are talking about. My noble friend Lord Brown and I do not always agree, but in this case, as two employers, we do agree. The word "reinstatement" may not be used in legislation, but we are talking of a human relations problem. It is certainly used in industry by the companies with which Lord Brown is involved and by the companies in which I am involved. If I may say so, in my company no managing director has the power or desire to dismiss somebody unless he has examined the file and accepted that the reasons for dismissal are overwhelming. The word "reinstatement" means reinstatement to us. The word as used in industry means that a man is entitled to
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get his job back. Paragraph (4)(b) says: says:
"considers that it would be practicable"
Practicable to whom? If somebody else has been given the job in the three months while the complaint has been under discussion of course there are going to be difficulties; but who is responsible for the difficulties, the man or the company? As an employer, I think the Amendment should be accepted. It would be helpful not only to the people who make the complaints but to the people who have to deal with the complaints.
On the question of pensions it is stated in subsection (5), line 20:
"the tribunal shall make an award of compensation…"
No doubt the tribunal will take into account the loss which the man must have suffered if he has been dismissed and is not reinstated. That is not the same thing. No compensation will give a man back the opportunity for advancement in the company which has made the mistake. Is this clause to defend the employer about a mistake or to defend and help the man who has been unfairly dismissed?
LORD DRUMALBYN: My Lords, the noble Lord has put a question, and the answer is that the tribunal or the court will do what is just and equitable in the circumstances.
LORD BERNSTEIN: My Lords, it does not say so. It says what
"would be practicable".
I agree that
"and in accordance with equity"
follows. But if it is not practicable to the employer what are they going to do? They say you have to dismiss a man. Are they going to get involved in what is practicable with the operational company? The noble Lord, Lord Brown, and others have made a good point, and I think it would be regrettable if this Amendment is not accepted.
LORD DIAMOND: My Lords, I am sure that the noble Lord will recognise that we are in considerable difficulty about a matter which is of the utmost importance to every employee concerned, and we are very grateful that we are marching in step with the noble Lord in

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our desire to include reinstatement as an indication to the tribunal of what should be done, in contradiction to what the noble Lord indicated in his short intervention. The difficulty which the noble Lord put to us, and we are bound to take note of it, is that there is a technical drafting difficulty in that the word has never been used before in the text of a Bill. The noble Lord I am sure will forgive me if I point out to him—and I think he will find this correct in reading Hansard—that whenever in his interesting and clear and lucid speech he wanted to make his meaning clear he said "reinstate". I am only making the simple point that in conversation between us we all understand what "reinstatement" means.
The difficulty is that inasmuch as it is a word which is in such current and regular use throughout industry and in ordinary parlance, surely if it is omitted from the Bill it will be open to anybody to say that Parliament did not want us to reinstate, otherwise it would have said so. That is point No. 1. Point No. 2 is, "Why", they would go on to say, "did Parliament use a word like 're-engage', which word could be satisfied without reinstatement?" There is that difficulty. So the difficulty I see is not only that which the noble Lord has put forward but the fact that legislation as at present drafted is a clear indication, for those two reasons, not to reinstate. The noble Lord has used the word "re-engagement" as including the sense of reinstatement. That may be so, but for the two reasons I have given it is open to any tribunal to read this clause as at present drafted as meaning, "Do not reinstate but only re-engage".
I am bound to come to the technical difficulty, although my noble and learned friend Lord Stow Hill will be better equipped to deal with the legal side than I am. The word "reinstate", if it has not been used in the text of a Bill, nevertheless must have a meaning capable of being written down in English, and what it means could be written down in words which have been used in the text of a Bill, so if the noble Lord does not like the word "reinstatement" it can be broken down into what it really means and those words can be put in the Bill. The noble Lord said at one stage that
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"reinstatement" means "re-engagement in the fullest sense of that term". If that is a draftsman's phrase and is intelligible—it is intelligible to us—then put in the Bill "re-engagement in its fullest sense", or whatever words indicate to a tribunal that it should include in its review the possibility of what every noble Lord in the House would describe as "reinstatement". We must not be put in the ridiculous position that what both sides of the House want is incapable of being achieved and, worse than that, that an indication is being given to the opposite. I do not know how it is going to be drafted, but we cannot leave it in its present form.
LORD SINCLAIR OF CLEEVE: My Lords, may I say that I have great sympathy with the thought that lies behind this Amendment. From my own experience I think it is desirable that what we all recognise and think of as reinstatement should somehow be covered. But I must say that on looking at this clause as drafted it seems that the words immediately following subsection (4)(b):
"the tribunal shall make a recommendation to that effect, stating the terms on which it considers that it would be reasonable for the complainant to be so re-engaged or engaged"
give the tribunal full discretion to specify reinstatement or such degree of reinstatement as it thinks appropriate. That seems to me to be common sense.
3.38 p.m.
LORD STOW HILL: My Lords, may I press the noble Lord a little further on this matter and take some of the points he has dealt with? First of all, he feels that there is a difficulty about the word "reinstatement", and if I understood him correctly he was saying that the word "reinstatement" is not used in the text of any other Statute. With great respect to him, it was used, for example, in Clause 37 of the last Government's Bill. The words are:
"shall make an order for reinstatement".
That Bill, I take it, was drafted by the same Parliamentary counsel as drafted the present Bill. If they found no difficulty in putting it in the last Bill I should have thought there could not be any difficulty so formidable as to prevent its being put into this Bill. It seems to me that the Minister might be a little more helpful here. I do not mean to say that he

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is intending to be unhelpful—that is the last thing I would ever say of the noble Lord, Lord Drumalbyn. The noble Lord is very responsive to the mood of the House; he has always shown himself to be so. I should have thought that it was quite obvious on this occasion that there is, on both sides of the House, strong sympathy with the general purpose of this Amendment. If that is so, and if the Government, as the noble Lord has said, also sympathise with it and themselves would like to achieve precisely the objective I sought to outline in moving this Amendment, we should make a concerted effort to ensure that that objective is achieved by the language which appears in this Bill.
My Lords, I quite follow the noble Lord's argument that the phrase, "to be re-engaged on such terms as he considers reasonable" would cover all that could be included in the Bill if the word "reinstatement" were put into it. I submit that is not the case, or at least that it is doubtful whether it is the case. If it is doubtful one can remove the doubt by definition sections and other drafting devices which Parliamentary counsel master so completely. I should have thought that reinstatement could have various aspects. In the first place it could have those aspects which I have sought to describe: those which relate to status; those which relate to the position which a person has achieved after many years.
The noble Lord will say that that can be done by prescribing in the recommendation terms which go to putting the worker back in precisely the same situation as he was before. I should have thought that there was some doubt, as a matter of drafting, whether the expression "terms" did extend so far. Generally speaking, I should have thought "terms" related to the remuneration you are to receive and the type of work you are to do, and could not be said to extend to putting you back, in terms of dignity and status, into the position in which you were before. So I should have thought that is open to doubt. Secondly, as the noble Lord said, there was the question of retrospection; and as has been pointed out by many of my noble friends, particularly by the noble Lord, Lord Pargiter, that is of critical importance in this case because of the pension aspect.
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I should have thought that if one uses the word "re-engage" in a Statute, you are connoting by the word itself that there is the beginning of a new contract; that you are not seeking to wipe out a break in a contract which has taken place and putting the person back to the position that he would have been in if there had not been that break. You are excluding retrospective operations.
LORD DRUMALBYN: My Lords, if that is so, why does the noble Lord think that the Bill uses the words "re-engaged or engaged"?
LORD STOW HILL: My Lords, the expressions "re-engaged" and "engaged" both describe, I should have thought, the creating of a new contract of engagement, a new contract of employment which starts as from the time you are speaking of, and it is the opposite of wiping out a break which had occurred in the past. I should have thought it undoubtedly a question whether the object that the whole House has in view is achieved by this language. With respect to the noble Lord, is not he being perhaps a little less co-operative than he is generally in refusing even to consider that which could have the effect of removing a doubt? Would he not consider, for example, putting something in the definition clause, Clause 163, to say that the expression "re-engagement" shall be deemed to include everything connoted by the word "reinstatement", couched in proper language which Parliamentary counsel could find? Would he consider doing something of that sort? Would he consider incorporating in this clause something which would make perfectly clear that the expression "terms" could extend to putting the position back as it was before?
So far as the pension situation is concerned, will the noble Lord consider putting something in Clause 115 which, as I have said, enables the industrial tribunal to increase the compensation payable if the recommendation is not carried out? Would he not consider putting something in that clause to make clear that the compensation that may be awarded, whether or not the man is re-engaged, shall amply cover any loss that he may sustain as the result of wrongful dismissal owing to a break in the contract of employment, for the purpose of any

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pension scheme? My Lords, all those things could be done. It would need a certain amount of careful drafting, but it is not beyond the wit of the Parliamentary draftsmen to achieve that purpose or of putting it beyond all doubt if they are instructed to do so. In reply to this debate I would earnestly ask the noble Lord to say that he will take this back. He recognises the justice of the case. He recognises, and indeed in his language it was almost instinct, I though, that doubt must be removed from the language as it is at the moment. I hope he will ask Parliamentary counsel to draft something to remove that doubt in its entirety.
LORD DRUMALBYN: My Lords, the noble Lord has asked me some questions, and, with the leave of the House, I will attempt to reply. The noble Lord has rested his case on the fact, as he says, that "reinstatement" has a different meaning from "re-engagement". I said that so far as I knew "reinstatement" was not used in an Act of Parliament. "Oh", he said, "but it was used in a Bill." How was the word "reinstated" defined in that Bill? It was defined as being re-engagement by the same employer
or by a successor or associated employer. If I had any doubt (and I assure noble Lords that I went into it in exactly the same questioning spirit as they have done and probed it) about whether the draftsmen could still be mistaken after all the explanation he has given, I would take this matter back again. But I am quite satisfied, and I give this advice to the House, that the word "re-engagement" covers "reinstatement". Although noble Lords may think they know what "reinstatement" means, as I pointed out it has three clear meanings and it may have several others. Obviously, if we used it at all, it would have to be defined. It is certainly not excluded by the word "re-engagement" as the definition that I have referred to says. Really, my Lords, I would be less than honest with the House if I suggested that I would be able to get any change of opinion if I were to take this matter back. It has been very fully gone into, and I can assure noble Lords that there can be no doubt as to the construction that will be put on it.
3.47 p.m.
On Question, Whether the said Amendment (No. 85A) shall be agreed to?
Their Lordships divided: Contents, 69; Not-Contents, 102.

CONTENTS

Addison, V.

Gardiner, L.

Reay, L.

Archibald, L.

Garnsworthy, L. [Teller.]

Ritchie-Calder, L.

Ardwick, L.

Greenwood of Rosendale, L.

Royle, L.

Beaumont of Whitley, L.

Henderson, L.

Rusholme, L.

Bernstein, L.

Hilton of Upton, L.

Sainsbury, L.

Beswick, L.

Hoy, L.

St. Davids, V.

Birk, Bs.

Hughes, L.

Samuel, V.

Blyton, L.

Jacques, L.

Segal, L.

Boothby, L.

Janner, L.

Shackleton, L.

Brown, L.

Kennet, L.

Shepherd, L.

Buckinghamshire, E.

Kilbracken, L.

Shinwell, L.

Burntwood, L.

Leatherland, L.

Silkin, L.

Burton of Coventry, Bs.

Lee of Asheridge, Bs.

Slater, L.

Carnock, L.

Lindgren, L.

Soper, L.

Champion, L.

McLeavy, L.

Sorensen, L.

Collison, L.

Maelor, L.

Stocks, Bs.

Cooper of Stockton Heath, L.

Nunburnholme, L.

Stonham, L.

Crook, L.

Pargiter, L.

Stow Hill, L.

Davies of Leek, L.

Peddie, L.

Summerskill, Bs.

Delacourt-Smith, L.

Platt, L.

Taylor of Gryfe, L.

Diamond, L.

Plummer, Bs.

Taylor of Mansfield, L.

Douglass of Cleveland, L.

Popplewell, L.

Wells-Pestell, L.

Gaitskell, Bs.

Raglan, L.

White, Bs. [Teller.]

NOT-CONTENTS

Aberdare, L.

Allerton, L.

Balfour of Inchrye, L.

Aberdeen and Temair, M.

Atholl, D.

Barnby, L.

Ailwyn, L.

Balerno, L.

Belhaven and Stenton, L.

Albemarle, E.

Balfour, E.

Belstead, L.

Berkeley, Bs.

Goschen, V. [Teller.]

Mowbray and Stourton, L.

Bessborough, E.

Greenway, L.

Nelson of Stafford, L.

Boston, L.

Grenfell, L.

Nugent of Guildford, L.

Bridgeman, V.

Gridley, L.

Oakshott, L.

Brooke of Cumnor, L.

Grimston of Westbury, L.

O'Neill of the Maine, L.

Brooke of Ystradfellte, Bs.

Hacking, L.

Rankeillour, L.

Burton, L.

Hailes, L.

Robbins, L.

Caithness, E.

Hailsham of St. Marylebone,

Roberthall, L.

Camoys, L.

L. (L. Chancellor.)

Rochdale, V.

Carrington, L.

Hankey, L.

Ruthven of Freeland, Ly.

Cawley, L.

Hanworth, V.

St. Aldwyn, E.

Clwyd, L.

Hatherton, L.

St. Helens, L.

Colgrain, L.

Hives, L.

St. Just, L.

Conesford, L.

Hood, V.

St. Oswald, L.

Cork and Orrery, E.

Hylton-Foster, Bs.

Sandford, L.

Craigavon, V.

Ilford, L.

Sempill, Ly.

Cranbrook, E.

Jellicoe, E. (L. Privy Seal.)

Sinclair of Cleeve, L.

Crathorne, L.

Kemsley, V.

Stamp, L.

Daventry, V.

Kilmany, L.

Stonehaven, V.

Denham, L.

Latymer, L.

Strang, L.

Derwent, L.

Lauderdale, E.

Strathcarron, L.

Drumalbyn, L.

Long, V.

Strathclyde, L.

Dundee, E.

Loudoun, C.

Tenby, V.

Eccles, V.

Lucas of Chilworth, L.

Teynham, L.

Effingham, E.

MacAndrew, L.

Vivian, L.

Elliot of Harwood, Bs.

Macleod of Borve, Bs.

Wakefield of Kendal, L.

Emmet of Amberley, Bs.

Mancroft, L.

Ward of Witley, V.

Ferrers, E. [Teller.]

Milverton, L.

Willingdon, M.

Ferrier, L.

Monckton of Brenchley, V.

Windlesham, L.

Fortescue, E.

Morrison, L.

Wrottesley, L.

Fraser of Lonsdale, L.

On Question, Amendment agreed to.

HOUSING FINANCE
3.55 p.m.
THE PARLIAMENTARY UNDERSECRETARY OF STATE, DEPARTMENT OF THE ENVIRONMENT (LORD SANDFORD): My Lords, with the permission of the House I should like now to repeat a Statement, which is being made in another place by my right honourable friend the Secretary of State for the Environment, on the reform of housing finance in England and Wales. The Statement is as follows:
"In my Statement of November 3 I informed the House of the broad principles of our reform of housing finance. We have discussed the details of our plans with the local authority associations and the voluntary housing movement. The proposals which we have formulated in the light of these discussions are set out in a White Paper (Command No. 4728) which my right honourable and learned friend the Secretary of State for Wales and I are presenting to the House. Copies are now available in the Vote Office."
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And they are also in the Printed Paper Office of your Lordships' House. The Statement continues:
"For the first time in our history there will be a national rent rebate scheme for all unfurnished tenants under which a rent rebate or allowance will be available to those tenants who need help to pay a fair rent for the house that they occupy. This will mean that 2½ million tenants in the private sector will for the first time have a rebate scheme available. It will mean also that council house tenants in authorities which do not at present have rent rebate schemes—that is, almost 40 per cent. of all authorities—will now be covered by a scheme.
"Let me give an example. Take a council house tenant with a wife and two children who lives in a house with a fair rent of £4 a week. If his gross income is £25 a week, he will then get a rebate that will reduce his rent from £4 to about £2·70 a week. For those on very low incomes in relation to their family responsibilities, the scheme will provide a full rebate of rent, so that they will pay no rent at all. When the scheme is introduced, many council and private tenants will meet less of the rent of their dwelling than before.

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"The White Paper proposes the replacement of the existing subsidy system by a new system to give a fresh stimulus to housing authorities and associations who need to go on building and to clear slums. If an authority incurs a deficit on its housing revenue account because it builds new houses for people now living in slums, Exchequer subsidies will meet about 75 per cent. of the deficit. In addition, if the authority makes a loss on the slum clearance operations itself, an entirely new slum clearance subsidy will meet 75 per cent. of that loss. In order to give an immediate momentum to slum clearance, we have decided that this new subsidy should be retrospective to the beginning of the present financial year.
"I have already announced in my statement of November 3 that the fair rent principle will be applied to local authority dwellings and extended more rapidly to private controlled tenancies. The White Paper now makes it clear that the rent increase for council dwellings which are now below the fair rent will be phased in annual steps. The average annual increase will be 50p a week, subject to transitional arrangements for the period up to March 31, 1973, which are explained in the White Paper. When a private tenancy passes out of rent control and the registered fair rent is substantially higher, the increases in the rent of the tenancy will be phased in three equal annual instalments.
"The Government intend to introduce a Bill early in the next Session of Parliament to give effect to the proposals in the White Paper. These proposals will create a system of housing finance which is fair to all concerned and which concentrates help on people and areas in need.
"My right honourable friend the Secretary of State for Scotland will be presenting a White Paper to-morrow which will contain his proposals for the reform of housing finance in Scotland."
My Lords, that is the end of the Statement.
LORD GREENWOOD OF ROSSENDALE: My Lords, we are all grateful
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to the noble Lord for repeating the Statement for your Lordships' consideration. I have no doubt that the Under-Secretary will agree with me that this is a highly complicated subject. It was because of the complexity of the problem that I asked for a study of housing finance to be made, but I must confess that I am rather shocked at some of the uses to which the Government are putting the work which has been done. I have no doubt that all your Lordships would agree that subsidies should be directed to those in greatest need. That, of course, was why we increased the subsidy and embarked upon a programme of priority housing areas. Although some tenants will benefit from what the noble Lord has suggested, a large number, in both the public and the private sector, will not, and the burden which falls upon them will be a good deal heavier than the Labour Government would have found tolerable. But at the moment, until we have studied the White Paper, it is difficult to quantify the effects.
I should like to ask the noble Lord three questions. First, is not this Statement rather a breach of faith with those local authorities that have embarked upon considerable housing programmes on the basis of the housing subsidies which existed at the time when they decided upon those programmes? Secondly, is not the imposition of a national rent rebate scheme a further erosion of the discretion of local authorities?—which I believe to be a clear breach of the pledges that the Conservative Party gave to the country and to local authorities at the last Election. It does, of course, mean a great extension of means testing. Lastly, is the noble Lord able to give us any indication of the effect these proposals will have on the size of the local authority house-building programme? Those are the questions that I put to the noble Lord, but perhaps I may conclude by expressing the hope that we shall have an early opportunity of debating this subject, in the hope that we may influence the Government's thinking on these matters before they embark on legislation.
LORD SANDFORD: My Lords, I am grateful for those comments from the noble Lord, and I should particularly like to pay a tribute to the work done by him and his Administration on which we are now building: because it was the

213
noble Lord's Administration that introduced fair rents; and fair rents lie at the base of the whole of this reform. The noble Lord said that heavier burdens will be laid on tenants, but I would point out to the House that, if this is so, those burdens are going to be removed from the shoulders of those least able to bear them by the introduction of rent rebates and rent allowances, which were not available to those weaker shoulders when, under the previous Administration, increases were permitted to fair rent levels.
As to the statement about a breach of faith, the total scale of subsidy will remain at about the level that it is now, but it was not possible to introduce changes as radical as this without altering its application. What has happened now is that, as a result of this reform, it will be possible for local authorities to concentrate the help on the people who need it and in the areas which need it. To that extent, I would not agree that this is an erosion of the responsibilities of local authorities. It is quite true that we have here a nationally designed scheme. But it will be administered locally and, as a result of the changes, those authorities that particularly need to accelerate the clearance of slums and to relieve overcrowding will be provided with greater resources with which to do it. I can certainly confirm that their house-building programmes will now be able to go forward at an accelerated pace. As to a future debate on this subject, this would certainly be welcome, but the arrangements will have to be made through the usual channels.
LORD GREENWOOD OF ROSSENDALE: My Lords, may we take it, from what the noble Lord has said, that he is saying that this is a breach of faith, and that the Government had no alternative but to embark on a course of action which did mean breaking faith on the promise that had been given? Is he admitting, too, that this does in fact limit the discretion of local authorities? That is the only interpretation that I think can be put upon it. If the noble Lord believes that this is going to mean an increase in the council house-building programme, can he say what figure the Government are aiming at in that field?
LORD SANDFORD: My Lords, I think the noble Lord will see when he reads the White Paper that the overall level
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of subsidies now available to local authorities will remain available but it will be possible to concentrate them on the people and the areas that need them, instead of spreading them in an indiscriminate manner.
LORD BROOKE OF CUMNOR: My Lords, I welcome my noble friend's Statement, and also Lord Greenwood's suggestion that we should debate this matter, because until we have read the White Paper it is a puzzling and complex Statement to take in. But can my noble friend think of any reason why anybody should be shocked at the extention of a right to rent subsidies or of rebates to all tenants, whether council tenants or private tenants, to be given in accordance with their needs, but not beyond their needs?
BARONESS EMMET OF AMBER LEY: My Lords, the fact that 2½ million people in the private sector are for the first time to be given a debate is extremely welcome, and it is such an important matter that I should like to ask my noble friend in what way this will be made known to them, so that they can take advantage of the reform, and also to those who are in council houses among the 40 per cent. of local authorities that do not as yet practise a rent rebate scheme. I think publicity is of immense importance.
LORD SANDFORD: My Lords, I am grateful for that question from my noble friend. There will be a statutory obligation on local authorities and private landlords to inform their tenants of their rights under these arrangements. Broadly speaking, local authorities will have to notify their tenants in writing of the circumstances in which they will be eligible for rebates. This has to be repeated once a year and in any case on a first tenancy, and on any change of rent. In the case of private landlords, the relevant information has to be inserted, within four weeks, in any rent book issued on or after January 1, 1973. I am referring to extracts from the White Paper. It is all set out more fully in the White Paper.
LORD HUGHES: My Lords, the last few words of the Statement which the noble Lord repeated made a reference to a further White Paper to-morrow from the Secretary of State for Scotland. I take it that that will be accompanied by a Statement made in another place by the

215
Secretary of State, and that that Statement will be repeated in your Lordships' House to-morrow.
LORD SANDFORD: My Lords, that would certainly be my assumption. My precise words were that:
" My right honourable friend the Secretary of State for Scotland will be presenting a White Paper tomorrow."
LORD STONIIAM: My Lords, can the noble Lord say whether any estimate of the net additional cost to the Treasury has been made of these proposals; and, if so, what it is?
LORD SANDFORD: My Lords, I think I said in answer to a question from the noble Lord, Lord Greenwood of Rossen dale, that the overall scale of subsidy remains roughly where it is. The alarming increase which was in prospect will be curbed, and, through this whole new system, the subsidies available will be concentrated on the areas where they are needed—in slum clearance, and increased house-building—and on the people who need help.
LORD STONHAM: My Lords, does that mean that there will be no additional net cost to the Government? Is it a case of robbing Peter to pay Paul?
LORD SANDFORD: No, my Lords; it is a question of concentrating the subsidy where it is most needed.

INDUSTRIAL RELATIONS BILL
4.9 p.m.
Report stage resumed.
LORD DRUMALBYN: My Lords, with the permission of the House, I should like to make a personal statement, because I am afraid that I misled the House, quite inadvertently, by something that I said. I said words to the effect that "reinstatement" was defined in the Labour Party's Bill as re-engagement of the employee either by the employer by whom he was dismissed, or by the successor of that employer, or by an associated employer. I have been able to refresh my memory from the exact text since then and I find that that is not accurate.
What I should have said was that there are two things there plainly: first, re-engagement of an employee either by the
216
employer by whom he was dismissed or by a successor of that employer, or by an associated employer; or, second, where re-engagement does not take place, then under that Labour Bill an order to be made for reinstatement in the employment from which he was dismissed either in the position he held immediately before the relevant date or in a different position which in the opinion of the tribunal would be reasonably suitable. My Lords, I apologise unreservedly to the House for having made this statement.
LORD DIAMOND: My Lords, I do not know whether it is your Lordships' practice for somebody on this side to rise and say how grateful we are to the noble Lord for what he has said, but I should like to do so.
LORD STOW HILL: My Lords, my noble friend Lord Diamond having said that, and I having wanted to say it very much but thinking I should not be in order to make an observation on a personal statement, I was going to move the next Amendment in order to give myself the opportunity of saying how very grateful I am to the noble Lord and how I honour him for having got up immediately to correct his mistake. It is extremely easy to make mistakes of that kind and, having known him for a great many years as a Member of Parliament, I may say that it is exactly what I should have expected from him.
THE LORD CHANCELLOR: My Lords, I understand that Amendment No. 85B is not moved.
LORD STOW HILL: My Lords, I did say that: I had intended to move it in order to make the observation that I made earlier regarding the noble Lord's statement, but I did not know whether, if I did so, I should be going against the rules of the House. But I said that I thought there was no useful point in moving the next Amendment.
THE LORD CHANCELLOR: They are on the same point: I thought that we were discussing them together.
4.12 p.m.
LORD DIAMOND LORD DIAMOND moved Amendment No. 85B:
Page 81, line 12, after ("so") insert ("reinstated").
The noble Lord said: My Lords, I am in your Lordships' hands. The Amendment is down in the names of Lord Diamond and Lord Stow Hill. My noble friend has explained why he was proposing to move this Amendment, which was in order to offer courtesy to the noble Lord, Lord Drumalbyn. I am proposing to move this Amendment in order to continue discussion of the substance of the matter now that a totally new situation has emerged. I hope that will be in order.
I beg to move this Amendment. There is no need for me to repeat the arguments that went on on the previous Amendment. We had reached the situation where both sides of the House were agreed that reinstatement would be a very good thing to include in the Bill if it could be so prescribed, and difficulty arose because we were informed it had never been used in a legal context. Then my noble friend Lord Stow Hill produced the legal context in which it had been used. That then was explained away, erroneously, by the noble Lord, Lord Drumalbyn.
Now let me, if I have your Lordships' patience, recite to your Lordships' House what in fact the text provided, because to every fair-minded person I think it makes absolutely clear that not only is "reinstatement" a word which has been used many times in a Bill which provides for exactly what the Government want to provide in this paragraph, but that without the word "reinstatement" it is obviously going to have a different effect. Clause 37 of the Industrial Relations Bill which received a First Reading, is the clause where this word is first used. I shall read only the part of it that is relevant. If your Lordships wish me to read it all I shall be pleased to do so. Clause 37 says:
"Where, on reference of a claim to a tribunal under this Part of this Act, the tribunal finds that the employee was unfairly dismissed…"
that is what we are considering—
"and that he has not been re-engaged as mentioned in subsection (2) of this section "—
and so on.
May I refer now to what subsection (2) says in relation to re-engagement:
"(2) In the preceding subsection the reference to the re-engagement of an employee as mentioned in this subsection is a reference to
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the re-engagement of the employee either by the employer by whom he was dismissed or by a successor of that employer or by an associated employer."
So we now get back again to the first part—
"the tribunal finds that the employee was unfairly dismissed and that he has not been re-engaged as mentioned in subsection (2) of this section, the tribunal

(a) shall make an order for reinstatement under section 38 of this Act if, in accordance with that section, reinstatement is the appropriate remedy or…"—

something else, or compensation.
We now therefore turn to Clause 38 and this describes an order for reinstatement. This clause is about 20 lines long, and with your Lordships' permission, I think I must read it in order to make the point clear:
"For the purposes of this Part of this Act reinstatement is the appropriate remedy where—

(a) the tribunal is of the opinion that in the circumstances it would be practicable for the employee, if he agreed, to be reinstated in the employment from which he was dismissed, either in the position which he held immediately before the relevant date or in a different position which in the opinion of the tribunal would be reasonably suitable to him, and

(b) the employee agrees to be so reinstated.

(2) Before determining whether it would be practicable for the employee to be reinstated as mentioned in subsection (1)(a) of this section, the tribunal shall take into account any representations relating to reinstatement of the employee which may be made to the tribunal by or on behalf of the employer at the hearing or which in accordance with industrial tribunal regulations have been made by or on behalf of the employer before the hearing.
(3) Where the tribunal is of the opinion that it would be practicable for the employee to be so reinstated, the tribunal—

(a) shall indicate to the employee whether the reinstatement would be in the position which he held immediately before the relevant date, or, if it would be in a different position, shall indicate to him the nature of that position…"

and so on.
Subsection (4) reads:
"An order for reinstatement under this section shall require the employer, on such date as may be specified…to reinstate the employee in his employment and shall indicate…the position in which the employee is to be reinstated."
My Lords, I have read practically the whole of that clause and the relevant

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part of the preceding clause. It is absolutely clear that "reinstatement" is repeatedly used in this clause to describe a situation which all of us on this side of the House are anxious to achieve and which we believe that the Government are also anxious to achieve. Therefore I have no alternative but to put the view again before the noble Lord and to ask him whether, in the light of the inadequate information which he had at his disposal when he rejected the earlier Amendment and in the light of the additional information which is now available to him, he will be good enough to reconsider the matter between now and Third Reading. Here is a really important issue. We are all trying to achieve the same thing. The noble Lord thought there was no method of doing it. We found that impossible to believe, and we found an example by which it could be fully and satisfactorily done. I hope that the noble Lord will give this matter further consideration.
THE EARL OF BALFOUR: My Lords, I wish to say only a few words. First of all, I think that the apology and explanation given by my noble friend Lord Drumalbyn made the position even more clear than it had appeared from his earlier statement. We are dealing in this clause with the unfortunate man who has been dismissed. He has then gone to the trouble of going to the courts. The counts have investigated the matter and come to the question of either trying to get that person back into employment with his previous employer or leaving the man unemployed, with his compensation. If the word "reinstatement" is to be taken to its fullest extent, it means then that the courts have the choice of either arranging for the employer to pay that man compensation or that he is reinstated in exactly the same job, making the whole position extremely difficult. If, on the other hand, the courts have the wider opportunity of encouraging the employer to re-engage that man—if necessary at the same salary, but doing a slightly less important job, or something like that—I feel that this goes a very long way towards getting that man back in employment. From what has been said by the noble Lords opposite, it appears to me that they would rather have the person either reinstated completely
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or left unemployed, with compensation. This is not the sort of thing that I should like noble Lords on this side of the House to support.
4.22 p.m.
LORD DRUMALBYN: My Lords, as I said before, I sympathise with the objectives of the noble Lord opposite, but on this occasion I do not sympathise with his logic. He will remember—in fact he read it out—that the Labour Government's Bill, which got only as far as First Reading, included the word "reinstatement". There is no difference between us here. I said that, so far as I knew, and I was told, the word had not been used in any Act of Parliament. It had been used in a title and in a rubric and it has been used in a Bill. That is the first point. The second point is that the Labour Government's Bill provided for reinstatement by order of a tribunal. The present Bill does not provide for reinstatement by order; it provides for re-engagement by recommendation, a recommendation for re-engagement. The noble Lord read out the two paragraphs concerned, and the alternatives were perfectly clear. First of all, there was the possibility that the employer would reengage or that a successor of that employer would re-engage, or that an associated employer would re-engage. Secondly, if that was not done, there could be an order for reinstatement in the same employment—that is, in the employment from which he was dismissed—either in the position which he held immediately before the relevant date or in a different position.
My Lords, is it not abundantly clear that this proves the point I was making: that, without any doubt whatsoever, reinstatement is included in "re-engagement"? Either the man could be re-engaged by the same employer or a different employer—that is an associated employer or a successor—or he would be reinstated in the employment from which he had been dismissed, either in his original position or in a different position. This shows that reinstatement has at least two meanings, even under this Bill, and can have more. So it is abundantly clear that reinstatement is included in re-engagement. I invite the House to follow that logic rather than the logic of the noble Lord in this matter.
LORD DIAMOND: My Lords, we cannot pursue this point endlessly. I regret

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that the noble Lord has not seen fit to give himself time to reconsider this matter, especially as he says it is his view, and the view of the Government, that reinstatement, as the word is used in common parlance, should be a remedy open to the tribunal. It may be reinstatement in the original position or in some other position, but certainly reinstatement. I am sorry that he has not given himself time to think about it further. I do not wish to delay progress of the Bill by dividing the House again. All we can say is that we are doing the best we can to make it clear to all concerned, and we hope the Government will co-operate to make clear that the words are intended to include reinstatement and that it is the Government's desire, as Hansard will record, that it should be so interpreted. In those circumstances I do not think my noble friend Lord Stow Hill wishes to comment further in this debate.
LORD PARGITER: My Lords, there is one point I should like to make, before we finally withdraw. I should like to be clear on the tribunal's rights with regard to compensation. Assuming that the tribunal can order an employer or recommend an employer to re-engage a person, and if it is shown that this involves a considerable loss, would the tribunal be entitled to order compensation as well as re-engagement?
LORD DRUMALBYN: My Lords, perhaps I may answer that point. The tribunal cannot order; in this case it makes a recommendation.
LORD DIAMOND: My Lords, as I was saying, I think it would be appropriate if I sought your Lordships' permission to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 85C:
Page 81, line 42, after ("and") insert ("where the organisation is a trade union or an employers' association, that it was taken against the person who presents the complaint, and (whether the organisation is a trade union or an employers' association or not) that the action specified in the complaint").
The noble Lord said: My Lords, earlier debates have demonstrated that there is a wide measure of agreement in all parts of the House that the right of complaint about breaches of rules or
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guiding principles by trade unions or employers' associations should be restricted to the complainant party, and that complaints by extraneous parties should be excluded. Amendments to Clauses 81 and 82 already accepted by the House secure that effect so far as complaints made to the Registrar are concerned. This Amendment extends the same principle to complaints brought to an industrial tribunal.
I hope that noble Lords will agree that it is unnecessary to go over those arguments again, but there is one point that I should make to your Lordships. It will not have escaped your Lordships' attention that the clause as amended, although restricting the right of complaint against a registered organisation to injured parties, imposes no such restriction on complaints against unregistered organisations. So, where the other conditions are satisfied, the complainant will not be required to show that the action of an unregistered organisation was taken against him before his complaint under this clause can be heard.
We can see no means of avoiding this distinction. We would have done so if we could. If the right of complaint were restricted to the party against whom the action was taken, certain breaches of rules by unregistered organisations could not be complained of at all. For example, it is very doubtful whether any individual member could show that the action of his organisation in improperly removing or failing to appoint an official was directed against him. Similarly, probably no individual would or could complain of a rule specifying the manner in which the rules of the organisation can be altered or revoked was breached.
I think noble Lords on all sides of the House would agree that it would be wrong to allow such a loophole to exist, and so we have reluctantly concluded that we cannot restrict the right of complaint to injured parties so far as unregistered organisations are concerned. Registered organisations do not present the same problems because in Clause 83 the Registrar has power to investigate on his own initiative breaches of rules or guiding principles, and that is a safeguard. In practice I do not think this will cause unregistered organisations undue difficulty or embarrassment. There

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must have been a breach of rules or guiding principles before there can be a complaint—or an alleged complaint, at any rate—and the tribunal will be able to award costs where frivolous or vexatious cases are brought. This should deter malcontents and dissidents who are trying to harass unregistered organisations without due and reasonable cause. I beg to move.
LORD STOW HILL: My Lords, I feel a little puzzled by what the noble Lord has just said. I cannot understand why there should be that distinction between a registered organisation and an unregistered organisation. In the case of a registered organisation the complaint under Clause 66 can only be made by a person against whom the action is directed, but not in the case of an unregistered organisation. May I now put the question to the noble Lord in this form: suppose we have a registered and an unregistered organisation and their rules are precisely the same. The only difference is the name, otherwise the words from beginning to end are precisely the same. A member of the registered organisation who wishes to complain under Clause 66 that an action has been taken against him which infringes the general principles of Clause 65 proceeds under Clause 107. A member of an unregistered organisation looking at precisely the same rules and deciding that those rules involve an infringement of the principles of Clause 66 against him presumably also uses the same clause. As I read Clause 66 it does not relate only to a registered trade union: it includes an unregistered trade union or an unregistered organisation of workers.
I am sure it is entirely my fault, but I should be grateful if the noble Lord would make the position a little clearer to me. I did not follow it, and although I cannot say that I feel violently about it I think that if we are making a change the reason for that change should be made clear. It seems to me that a member of an unregistered organisation might just as well be a person against whom an action is taken as a member of a registered organisation. I am sure it is my fault that I do not understand, and I shall be glad if the noble Lord will explain it a little more fully in his reply.
LORD DRUMALBYN: My Lords, perhaps I can try again. The difference between the member of the registered organisation and the member of the unregistered organisation is this: a member of a registered organisation has a choice; he can make his complaint either to the Registrar or to the tribunal, but in either case it must be a complaint about action taken against him. In the case of the registered organisation the Registrar himself has the power to investigate other cases, so he can investigate cases that are not taken against any particular person. But in the case of the unregistered organisation, if we were there to confine the right to complain only to actions taken against an individual, then in the case of those actions that were of a more general character, for example faults on voting procedures, and the like, there would be no means at all of their being brought to the tribunal. Therefore, so far as unregistered organisations are concerned we cannot confine such cases to actions against the person making a complaint. We have to allow it to go wider and allow complaints to be brought by persons against whom action has not been taken personally—or should I say whom action has not prejudiced in some way in their personal capacities. I hope I have made it clear.
LORD STOW HILL: I thank the noble Lord.
Clause 110 [Complaint of breach of duty under section 57]:
THE LORD CHANCELLOR: My Lords, I beg to move Amendment No. 85D, which is a purely drafting Amendment.
Amendment moved—
Page 84, line 5, leave out ("authorised") and insert ("determined").—(The Lord Chancellor.)
4.38 p.m.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved Amendment No. 85E:
After Clause 111 insert the following new clause—
Application to Industrial Court for declaration with respect to collective agreement
".—(1) Any party to a collective agreement in writing may make an application to the Industrial Court for a declaration with respect

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to any question relating to any provisions of the agreement.
(2) Any such application shall specify the question or questions on which a decision of the Industrial Court is sought and, with respect to each such question—

(a) shall indicate the provisions of the collective agreement to which it relates, and

(b) shall contain, or be accompanied by, a statement of the facts in consequence of which it is claimed that the question arises.

(3) An application under this section—

(a) shall not be entertained by the Industrial Court if it relates to a collective agreement which contains a provision (however expressed) stating that the agreement is intended not to be legally enforceable, or

(b) if it relates to a collective agreement which contains a provision (however expressed) stating that part of the agreement is intended not to be legally enforceable, shall not be entertained by the Industrial Court in so far as it relates to that part of the collective agreement.

(4) On an application under this section the Industrial Court, having regard to its findings in respect of the facts stated by the applicant and in respect of the construction and effect of the provisions of the collective agreement to which the application relates, may, if the Court considers that it would be just and equitable to do so, make such declaration with respect to any question specified in the application as the Court considers appropriate."
The noble and learned Lord said: This is a fairly substantial new clause, and the purpose and effect of it will be to give a new jurisdiction to the Industrial Court in respect of written collective agreements which are enforceable. It arises from the two speeches made by the noble and learned Lord, Lord Wilberforce, and the noble Lord, Lord Tangley, in the course of the Committee stage, and it is one of two or three Amendments which have been made in response to the criticisms they then put forward. The position under the Bill as it stands at the moment is that one can go only for a declaratory judgment declaring the rights of the parties under an agreement if one goes by way of complaint of something that the other party has done wrong. We think this is unreasonable and it ought to be possible to get a declaration of right by either one or both parties to an enforceable agreement before relations have deteriorated to the point at which the parties are at arms' length. Of course those who do not wish to invoke the aid of the Court can instead agree to voluntary arbitration arrangements of their own for the same purpose, and in some cases the wiser parties already do so. They can continue to do so under the terms of
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this Amendment. As I have said, it is limited to written collective agreements, and those which are not enforceable and those which contain disclaimer clauses are excluded under the terms of subsection (3) of the new clause, paragraph (a) applying to those where the disclaimer is general and paragraph (b) applying to the cases where the disclaimer is partial.
Subsection (4) makes it clear that the jurisdiction which is conferred by the new clause is discretionary; that is to say, the Court will make its declaration only if it is just and equitable to do so. That corresponds to the existing jurisdiction of the High Court in such cases, where the remedy by way of declaration is discretionary and the discretion is not always exercised, although in recent years parties to agreements have found it more and more convenient to utilise the power of the Court to make declarations of right in such cases where they are not hypothetical or academic or premature. It is additional to the procedure by way of complaint which already exists, and I hope it will be found convenient and useful to the parties to collective agreements where these are enforceable under the Act. I beg to move.
LORD STOW HILL: My Lords, I should have thought this was an extremely valuable new jurisdiction, and I quite agree, if I may say so, with the noble and learned Lord that it obviously will conduce to peaceful relationships, in that it will enable the parties to collective agreements to ascertain how they stand before relations become strained, and I would wholly support the Amendment. I should just like to ask one question of the noble and learned Lord. It may be that I have missed something, but the new clause is clearly designed, as the noble and learned Lord has said, to apply to collective agreements which are legally enforceable; that is to say, it excludes collective agreements which have a provision stating that the agreement is not to be legally enforceable. What I am looking for and have not yet discovered is the following. Clause 34, which relates to collective agreements which are made enforceable unless they are expressed not to be enforceable, only relates to collective agreements made in writing after the commencement of this Act. In other

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words, collective agreements made before the commencement of this Act were probably unenforceable in any event because of Section 4 of the Trade Union Act 1871, or even if they were not expressly made unenforceable by virtue of that section were unenforceable by their nature, on the ground that the parties did not intend to enter into contractual relationships.
I would have thought, therefore, that in the new clause there would be some provision limiting the application to collective agreements entered into in writing after the Act was brought into force. I looked at the definition of a collective agreement in Clause 162, to see whether there were some words which imported the provision in Clause 34 that the collective agreement must be one entered into after the commencement of the Act. I cannot find language in that new clause; it may be that there is some; I would be grateful if I might have my attention drawn to it if there is. If I am right in thinking there is not any such language in that new clause, and if I am right in assuming, as I do from what the noble and learned Lord said, that he intends the new clause to apply to collective agreements made enforceable by Clause 34, would it not be appropriate somewhere in the new clause to insert a provision that it should only have application to collective agreements in writing made after the Act comes into force? It may be I have missed something, but I make the point in case it has been overlooked.
LORD PARGITER: My Lords, there is one point I should like to be clear about. One assumes that the noble and learned Lord's reference to the Industrial Court would in effect mean that their decision would be legally enforceable. If that is so, I can see the logic of it not being applied to agreements which are not legally enforceable, because obviously if something is basically not enforceable it would be very difficult to enforce the part. I would have thought there might be some provision by which agreements not legally enforceable might be referred to the Industrial Court, or a tribunal, with a view to interpretation, with a view to avoiding difficulties that might arise in unenforceable agreements. I should like the point, whether that is so, cleared up. If the decision of the Industrial
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Court is not legally enforceable, there seems to me no reason why it should not apply to any body or person, whether it is an agreement legally enforceable or not.
THE LORD CHANCELLOR: My Lords, I will consider, if I may, the question raised by the noble Lord, Lord Stow Hill. I had assumed that because there is the presumption against retrospection in all legislation that would be enough, but the point is obviously worth considering and I will consider it. I cannot tell him what will be the outcome.
LORD STOW HILL: My Lords, I am very grateful to the noble and learned Lord.
THE LORD CHANCELLOR: My Lords, the question raised by the noble Lord, Lord Pargiter, is rather an interesting one. The new clause as drafted is clearly designed not to refer to agreements not legally enforceable. An order when made will be binding on the parties, but of course it is not directly enforceable because it will simply state what the rights of the parties are and will leave it to the parties to discharge their obligations under the rights so defined. If they break the agreement, the agreement will be interpreted in the light of the declaration, and the breach of the agreement would be a proper subject of disputatious proceedings which would yield in the end an enforceable judgment. One of the virtues of a declaratory judgment is that it does not imply necessarily an adverse order, except perhaps as to costs, between the parties disputing the rival interpretations of the agreement.
As regards the possibility, which is a slightly different one, which Lord Pargiter raised that you could refer to the Court questions as to the meaning of agreements which are not legally enforceable, clearly this is not within the terms of the new clause. I do not know of any fundamental reason why, if an agreement was capable of a precise construction—which many such agreements are not—you should not refer those matters to the courts, but at the moment I think I am right in saying the courts would decline jurisdiction. They would say that they could not entertain proceedings relating to provisions which did not give rise to legal obligations, because they are, after all, courts of law, and certainly this new

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clause does not extend the jurisdiction of the courts to cover this class of case. What it does is to extend to the Industrial Relations Court the jurisdiction at present inherent in the High Court to make declaratory judgments even though no complaint has been made of breach of contract. It is an interesting question, but the answer is that it is not designed to apply to non-enforceable agreements, and I think it might be controversial if it were so designed.
Clause 112 [Power to confer jurisdiction on industrial tribunals in respect of damages for breach of contract of employment]:
THE LORD CHANCELLOR: My Lords, I should at this stage indicate, as I have to the noble Lord, Lord Stow Hill, who I think is handling Amendment No. 85G, that I have a Manuscript Amendment in my noble friend's name designed to deal with the same point, but in the meantime I must call No. 85G.
4.50 p.m.
LORD STOW HILL LORD STOW HILL had given Notice of his intention to move Amendment No. 85G:
Page 84, line 44, at end insert—
("and
(c) in relation to claims for any payments due under a contract of employment")
The noble Lord said: My Lords, I am very grateful to the noble and learned Lord. The Manuscript Amendment which he has referred to does precisely deal with the point which I sought to raise with two Amendments, Nos. 85G and 85H. The general objective was that Clause 112, very sensibly, vests in the industrial tribunal a number of claims which might otherwise have gone to other courts, notably the county court. They are claims for damages. But there are also other claims which arise immediately under contracts of employment (holiday pay, and so on) which it was thought could very conveniently be combined with such claims for damages. The object of Amendments Nos. 85G and 85H was to include those claims in the claims which might go to an industrial tribunal. The
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noble and learned Lord, as he has said, in much more suitable and felicitous drafting, brought about precisely the result we had in mind in drafting the two Amendments. That being so, may I ask the leave of the House to not move Amendment No. 85G and, in due course, may I make a similar application in relation to Amendment 85H.
4.52 p.m.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved Manuscript Amendment No. 85J:
Page 85, line 44, at end insert—
("and for the purposes of this section a claim for payment of any sum payable under a contract of employment shall be regarded as a claim for damages for breach of the contract, and any reference in this section to damages shall be construed accordingly.")
The noble and learned Lord said: As the noble Lord, Lord Stow Hill, explained, he put down a couple of Amendments which were designed to achieve the purpose of making it clear that a claim, for instance, for arrears of wages, would be amenable to the general terms of the clause. The point really is that technically a claim, for instance, for arrears of wages, or for liquidated sum by way of damages, might not be considered to be covered by the expression "damages" in the clause. This may be right. Indeed, when I first saw the noble Lord's Amendments I was briefed, as it were, to say that the word "damages" included it. But rather respectable legal authorities take a different view, and I am not sure that I do not myself. For that reason, I asked the draftsman to draft an Amendment which would be acceptable to him to achieve the result which the noble Lord had in mind. The present Manuscript Amendment is simply the draftsman's method of expressing the thoughts that lay behind Lord Stow Hills' previous Amendments. I have no particular views about the draftsmanship but, as it has come from the professional, I would naturally prefer it. I beg to move.
LORD STOW HILL: My Lords, I only rise to express my indebtedness to the noble and learned Lord the Lord Chancellor, and I hope that the House will accept the Amendment.
Clause 115 [General principles as to assessment of compensation]:
4.55 p.m.
LORD DIAMOND LORD DIAMOND moved Amendment No. 85F:
Page 87, line 41, leave out from beginning to end of line 44.
The noble Lord said: My Lords, this Amendment arises in the clause dealing with compensation, subsection (2) of which says:
"The loss sustained by the aggrieved party,…shall be taken to include—…
(b) loss of any benefit which he might reasonably be expected to have had but for those matters ".
The four following lines, which this Amendment seeks to remove, say,
"subject, however, to the application of the same rule concerning the duty of a person to mitigate his loss as applies in relation to damages recoverable under the common law of England and Wales or of Scotland, as the case may be."
All your Lordships are familiar with that duty in relation to damages. What I am advised is, first of all, that what we are concerned with here is not damages; and the point I want to put is that if these four lines were left in, the purpose of the clause would not be achieved in certain circumstances. One of the purposes of the clause is, I imagine, to deter discriminatory dismissals. Let us suppose that there is an unfair dismissal, which is clearly discriminatory, in circumstances in which there is a strong labour market, and the employee, carrying out his duty under these four lines, moves heaven and earth to get himself another job and succeeds in doing so over the weekend, shall we say, and finds himself engaged on the following Monday at a similar remuneration. Then, I suspect, under these principles there would be no compensation payable at all. There will have been a discriminatory, unfair dismissal, but there will be no compensation. I do not think that that is intended—I am sure it should not be intended. I am sure that would do nothing to discourage, in those rare cases where it might occur, discriminatory treatment by employers getting rid of an unwanted person for improper reasons, and improper under the terms of this Bill. I think the case is a clear one. I beg to move.
THE LORD CHANCELLOR: My Lords, the ordinary rule of law is that
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whether you are seeking damages or any other form of compensation you are not to make a profit out of somebody else's wrongdoing, but that you should be put in the same position as if the wrongful act had not been done. We have been discussing re-engagement and reinstatement for a long time, and that would be one way of doing it. Another way of doing it is by looking to see what the financial loss in each case has been and making it all up.
There are, of course, exceptional cases where the law allows vindictive damages for bad behaviour, or damages to compensate for injured feelings. I think they are becoming increasingly rare. The old breach of promise action is a very good example of this. There are cases where this is done, but it is pure compensation for wrongful, unfair industrial practices here; and the object is not to put the injured party into a better position than if the injury had not been inflicted, but in as good a position as if the injury had not been inflicted.
With respect to the argument of the noble Lord, Lord Diamond, if the injured party is the employer, he must then try to mitigate the effect on the workman. If the injured party is the workman, he must try to mitigate the penalty on the employer. But the fact is that it can be either in this case. I am surprised that he has not seen this. He took the case of wrongful dismissal, which I will come to in a moment; but this clause could, after all, operate to reduce the amount of compensation awarded against a trade union when, for example, an employer had complained to the court about an unfair industrial practice by the union, in consequence of which it had sustained a restriction of output or of some service it had contracted to provide. This might well indeed be a very considerable limitation upon the amount of compensation awarded against the union.
The principle is surely a just one and one should, I think, forget whether one side in a dispute is likely to gain by it rather than the other side. It cannot be right, for instance, when a workman has been dismissed unfairly, that he should deliberately refuse one job after another in order to "whack up" the compensation payable by his former employer. It also cannot be a just action by the former employer for him to sit upon the damage

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which a trade union may have inflicted upon him by an industrial practice which was wrong, in order to "whack up" the compensation which it may be compelled to pay, when he could be taking a perfectly reasonable series of steps to reduce the damage to himself by his own action. Both are unreasonable sets of actions and they should not be compensated, either under the existing law or under any law that I would consider just. If the noble Lord had said that these words were otiose and that without them the court would give effect to the very reasonable principle which I have been trying to describe, I am not sure what I should have said in reply. But now that he proposes to omit them, not because they are otiose but because they are offensive, I find myself opposed to his Amendment.
LORD DIAMOND: My Lords, the noble and learned Lord will not expect me to regard his last statement as a very persuasive or forceful argument. I take exactly what he said and I realise his difficulties, but with the greatest respect to the noble and learned Lord he has not met the difficulty that the legislation as proposed does not carry out Chapter 9 of the Donovan Commission's Report. It goes against the whole spirit of that. It may, in fact, be necessary to have an additional paragraph dealing exclusively with the case of the employer who seeks to get rid in a discriminatory way of an unwanted employee and suffers no penalty at all for doing so.
The noble and learned Lord said that nowadays there are very few cases indeed involving more than the damage suffered. We are not putting forward this Amendment in order to enable an employee to make a profit. We are not putting it forward in order to challenge the common sense proposition that everybody should mitigate their loss and should seek to look after themselves as far as possible, whatever has happened. We are putting this Amendment forward because the legislation, as drawn, offers no discouragement to discriminatory sacking of an unwanted employee, thereby committing an unfair practice. In the circumstances I have described, an employer could get rid of an unwanted employee at no cost to himself. I do not think that that is a satisfactory way of drafting the legislation, but I do not dispute that the legislation
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as drafted suits all the other circumstances which the noble and learned Lord described. I can only hope that the Government will bear this point in mind. I do not think I can press it any further than that, and in the circumstances, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.4 p.m.
LORD STOW HILL LORD STOW HILL moved Amendment No. 86:
Page 88, line 8, at end insert—
("Provided nevertheless that this subsection shall not apply to any proceedings on a complaint based on subsections (1) and (2) of section 5 or on section 22 of this Act."
The noble Lord said: My Lords, this Amendment relates to a comparatively small point, but it is not in any sense a Party point. It is what I ventured earlier to call a civil liberties point. I think it is of some importance, and it deals with an aspect of our affairs about which we should be extremely careful. The Amendment is sought to be made to subsection (3) of Clause 115, which provides as follows. Where the Industrial Court or industrial tribunal has to deal with a complaint (and that means any complaint under the Act, as it will be) and finds that the matters complained of,
"were to any extent caused or contributed to by any action of the aggrieved party in connection with those matters".
the Court may reduce, or indeed cancel, any sum which it might otherwise have awarded in order to compensate for any loss established by the complainant.
That is not a new concept in our legislation, although it is not one which is widely applied. But it is applied in the case of contributory negligence. The ordinary case of which one knows relates to street accidents. If you step off the pavement without looking right in front of an oncoming motor car, and you then sue the driver of the motor car for damages for injuries that you have sustained, the amount which the court may otherwise be disposed to award to you if you establish that the driver was negligent can be, and is, reduced by the court by taking into account your own contribution through your own neglect in not looking before you stepped off the pavement; and as a result you may get

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a very small sum indeed. It is that concept which is embodied in subsection (3) of Clause 115, and I do not complain at all of that in a general sense. What I seek to do by the Amendment is to say that that principle shall not apply when the Court is dealing with a complaint under Clauses 5 or 22; in other words, a complaint by a worker who asserts that his rights under Clause 5 have been infringed or, under Clause 22, that he has been unfairly dismissed.
May I look for a moment at the situation apart from the worker? When industrial action takes place between management and union, it often follows as the result of a long and complicated series of transactions, disputes and negotiations. I should have thought it was perfectly acceptable in principle that in that situation the Court should be entitled, if one party complains that the other is guilty of an unfair industrial practice to look also at the conduct of the complainant and take that into account. The Court has a general equitable jurisdiction and will try to do what is fair. In ordinary circumstances, unless some error creeps in, it will reach a just result which will balance the provocative conduct, if any, of the complainant against the wrongful conduct of the respondent. The situation is not really quite the same when one is considering the case of the worker, and I ask the House to say that the principle should be excluded when a worker is the complainant under either Clause 5 or Clause 22.
This matter was debated in Committee. I raised it and the noble and learned Lord the Lord Chancellor gave an answer which I have since considered very carefully. When I raised the matter, the criticism that I made of the wording of the Bill was that it was much too general, and too wide in scope. That is not a criticism that I am making at the moment. However, I went on to sayߞand this is an argument which I respectfully ask the House to consider again—that you might well get the case of a worker who was at a very serious disadvantage. For the purpose of my argument, I took what I frankly conceded was a rather extreme case. I took the case of a worker who makes himself thoroughly unpopular by disseminating unpopular doctrines. I
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took the case of a Maoist, or somebody whose hair was too long, or who made himself unpopular because of some personal habit which other people did not like.
My Lords, that, I agree, is rather the extreme case, and the noble and learned Lord, while accepting that one has a perfect right to use extreme examples to point an argument, would say that we should rely on the courts to arrive at a common-sense view. I entirely accept that, but the courts are put in particular difficulty when they have an obligation to consider provocative conduct. What are they to do in that situation? I submit that in our democracy we should be anxious to protect the unpopular person. People can become unpopular and disliked by their associates for reasons for which they are hardly to blame, for personal characteristics or personal views; and various things can be considered wrong about them according to ordinary judgment and ordinary taste. That may over a period of time produce a feeling of strong resentment—a very unjust feeling, but nevertheless most people suffer from it.
Society cannot come to their rescue as often as perhaps it ought. One ought perhaps to try to protect a person who has the misfortune to be disliked, but it is difficult to do so because in many situations there is no way of bringing help to such a person. But I suggest that it is going rather further than is wise to enact that when we get that sort of case the Court should have to look at any evidence or argument produced on the part of a man's employer to the effect that he had received a lot of representations—for example, that the man should be dismissed, or that he was a person whom his fellow workers could not get on with and they were trying to egg on the employer to get rid of him. That is not something which should be encouraged.
I submit that that is the kind of situation against which we should strive and we should go to the rescue of a person who finds himself in that position. That is all that this Amendment seeks to do. If it depended only on the extreme, unlikely case, I would not have ventured to move it, but I submit to the noble Lord, particularly in reply to the argument which he used and which I agree

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has force in it, that when you are dealing, not with the extreme case but with cases which do not involve any exceptional quality for which other people look on an individual with disfavour, and a person is unlucky enough to be unliked and becomes the victim of a campaign—round robin letters, or something of that sort—because his fellow workers want to get rid of him, or perhaps not his fellow workers but a foreman or shop floor manager or anyone else, we should not enable—or rather require, for this is not a question of enabling but requiring—the Court to take into account the fact that other people want to get rid of him. I submit that the principles of subsection (3) of Clause 115 should not be applicable when the Court is called upon to deal with a complaint by a worker, either under Clause 5, which sets out his general rights, or Clause 22, which enables him to bring a complaint in the event of his being unfairly dismissed. I beg to move.
5.14 p.m.
THE LORD CHANCELLOR: My Lords, I yield to no one in my desire to help people who are simply unpopular, because many people are unpopular for reasons which are wholly creditable to them, but this Amendment goes far beyond that. It is not, I think, a fair analogy to introduce the question of contributory negligence in common law. If somebody were to punch me in the face and break my false teeth, I daresay, if I were eager to bring an action at law—which most lawyers are not—I could get quite considerable compensation from him. I would get the cost of my false teeth, something for my pain and suffering and possibly something for the insult. But if the evidence was that I had insulted the other man first—made fun of his religion, his race or the colour of his skin, or even his political idea—I dare-say that most reasonable juries and most reasonable judges would reduce the amount and I should probably end by getting only the cost of repairing my false teeth.
That is really the only principle involved in this clause. Provocative conduct, either by an employee or by an employer, ought to be taken into account in assessing the amount of compensation. This is the principle which is adopted, and I should have thought, leaving legal
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questions aside, that it was a very sensible general line. The noble Lord, Lord Stow Hill, says, "All right; apply it to the employer, but we will not apply it to the workman in two cases, one under Clause 5 and one in the unfair dismissal case." I do not myself see why. I think that what is sauce for the goose is sauce for the gander, and in that I am strongly fortified by powerful and independent witnesses.
I am first entitled to call the noble and learned Lord, Lord Donovan, whom I am happy to see sitting on the Cross Benches, to my aid. I quote him sometimes when I agree with him, and sometimes when I disagree with him. In paragraph 553 of the Donovan Report this very situation is referred to in the case of unfair dismissal. The noble Lord definitely came down on this side. He said:
"The labour tribunal must, in our view, be free to take into account such circumstances as the nature of the employer's business, the employee's age, seniority and opportunities for alternative employment, the circumstances and manner of the dismissal, the extent to which the employee's actions were blameworthy and the effect of the dismissal on future pension rights and any other relevant considerations."
I have even more powerful witnesses on my side, because I think one can call in aid the Labour Government Bill which had a First Reading. Clause 41 of that Bill deals with deductions from the basic amount of compensation in cases of unfair dismissal and says:
"If it appears to the tribunal that, apart from the reason by reference to which the dismissal has been found by the tribunal to have been unfair, any actual omission on the part of the employee (not being an act or omission of a kind falling within any of paragraphs (a) to (e) of Section 36(1) of this Act) was a contributory reason for the dismissal, the tribunal may deduct from the basic amount of the compensation such amount as appears to the tribunal to be appropriate in the circumstances."
In other words, the Donovan Report and the Labour Government, having considered this very point, came to much the same conclusion as we have come to. The only comment I make is that this general principle affecting provocative conduct which is genuinely provocative and not just annoying should apply right across the board. An employer, for instance, against whom a complaint is made of an industrial practice which is unfair and who has repeatedly broken the

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terms of the industrial code of practice, even though he is not himself guilty of an unfair industrial practice should have this principle applied against him. I do not see why it should not apply both ways and in all cases. My impression is that the common-sense rule that what is sauce for the goose is sauce for the gander is an adequate reason for rejecting this Amendment.
LORD STOW HILL: My Lords, that is the answer. The noble and learned Lord does not accept the case I made. May I make one or two points in reply? The noble and learned Lord says that what is sauce for the goose is sauce for the gander. But I am not complaining about the application of this particular doctrine in the case both of the employer and of the trade union. If it can be shown against the trade union that the trade union itself was guilty of conduct which was provocative, then in the event of the trade union complaining against the employer—for example, under Clause 36, that the employer was in breach of a collective agreement—then precisely the same doctrine can be prayed in aid in diminution of any compensation paid to the trade union. So it is not in the least true to say that I am simply seeking something for the worker which I am not prepared to concede to the employer. I have conceded to both sides of the table; but I seek to except the worker because he is in a particularly difficult and vulnerable position, or he may be if he is one of these unpopular people.
The second witness which the noble and learned Lord prayed in aid was Mrs. Castle and her Bill. She obviously had in mind the sort of situation with which I am dealing, because there is excepted from the kind of conduct that can be taken into account (if I am right, having quickly read it) conduct which is within Clause 36, which, if I cite it correctly, deals in general, for example, with this situation:
"that the employee (otherwise than in a case falling within subsection (c) of the next following subsection) professed or practised, or did not profess or practise, a particular religion or religious doctrine, or belonged to or otherwise upheld the aims of, or did not belong to or otherwise uphold the aims of, a particular political party, or upheld or did not uphold a particular political doctrine".
The example that I gave when I previously argued the case, which I agree
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was an extreme example, was the case of a man who was a Maoist. That would be within that clause, and I should have thought, if I correctly read the effect of the Labour Government's Bill, that that is precisely the sort of situation in which the effect of the Labour Government's Bill would be that provocative conduct consisting in upholding the doctrines of an unpopular political Party should not be taken into account against him. But the House has heard both sides of the argument. If this does not commend itself to the Government, so be it. I do not think I would be usefully taking the time of the House in pressing the matter further or in asking the House to divide upon it, and I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 116 [Limit on compensation to be awarded against trade unions]:
5.24 p.m.
LORD DIAMOND LORD DIAMOND moved Amendment No. 87:
Page 89, line 2, leave out ("£25,000") and insert ("£15,000").
The noble Lord said: My Lords, your Lordships will recollect that this is a matter we discussed at the Committee stage. The Bill refers to a series of steps in relation to the limit of compensation awarded against a trade union. The steps are: step one, £5,000; step four, £100,000. There are four steps mentioned in the Bill. What the Amendment deals with is step two, which is clearly out of line with the other steps. The Government said on the last occasion that they would give this matter consideration. I hope they will; and the Amendment has been put down both to give them an opportunity to express the results of that reconsideration and to suggest a figure which really would be in step. The present figure is grossly out of step in that one case. I beg to move.
EARL JELLICOE: My Lords, the noble Lord has moved this Amendment with his usual arithmetical skill, and, although I did not take part in the discussion of this particular clause at our Committee stage, I should like to say why, after reconsideration, we feel that, despite what the noble Lord has said, and said with considerable moderation, we feel we have got the sums right here. I think I

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should first of all very briefly recapitulate our purpose in including this clause in the Bill.
My Lords, we recognise, and I think everybody recognises, that the losses which can be sustained by a company can be very large indeed in these sort of circumstances. They can be so large that if awards of compensation were based on the actual losses sustained a union could in fact be broken by a single judgment. I should like to make it clear that we have taken the view—and it is implicit in what my right honourable friend the Secretary of State for Employment has said in his introduction to the Code of Industrial Practice—that any such result would be completely contrary to our purposes and to the purposes of the Bill, which are to develop and maintain, so far as possible, stable relationships between the two sides of industry. That is why, my Lords, we believe that we should try to establish reasonable limits which would, on the one hand, afford a deterrent against irresponsible industrial action and, on the other hand, not be a crippling blow to any union.
I should like to make it clear that the limits which are set out in subsection (2) of this clause were arrived at after very careful consideration of a whole variety of considerations—the size of the trade unions, their resources in terms of finance, the distribution of their membership and the sort of losses that they could themselves inflict upon a particular company. I should also like to underline the fact that there is nothing punitive in this aspect of the Bill. What we are here considering are limits to how much an injured party can recover of the losses which he has actually sustained. I would make it clear that we recognise that any limits which one draws here can be held, arguably, to be artificial, and that there is therefore an element (you might so call it) of rough justice. I think there are only two ways to avoid that. One would be to adopt some sort of rigid formula; for example, the average earnings of those members of a particular union who might be on strike. This would be enormously complicated. The other way would be to have no limit at all, and this would be
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open to just the sort of objections that I have suggested.
The noble Lord has to a certain extent, I think, based his argument on the fact that the steps are uneven here, and I would straightaway recognise and accept that they are uneven here. But I think there is a good and sufficient reason for that, my Lords. I have had some figures worked out for me, and I see that under the limits in Clause 116 the liability per head of average membership would be up to nearly 520 pence per person for unions under 5,000. That comes down to 205 pence for unions in the range we are discussing, 5,000 to 25,000; to 93 pence in the 25,000 to 100,000 range; and to 32 pence in the 100,000 and above. There is—and I would be the first to concede this—an uneven incidence here. I would only say that this is quite deliberate. This tapering off has been deliberately imported into the Bill because of a very important consideration, and the consideration is this. Let us take, for example, the very large unions: the T.G.W.U. or the General and Municipal Workers or the Union of Shop Distributive and Allied Workers. The membership of that latter union, for example, goes right through all the food processing and food distribution industry. Its membership is involved in thousands of firms; and, therefore, it could be simultaneously involved in a very large number of industrial situations potentially at the same time, and therefore at risk. This is what is always possible with a very large union, and this is in fact the reason for this particular form of tapering which, on the face of it, I would readily grant, might appear to be illogical. But I think there is a logic here, and I hope in view of that, and in view of what I have said by way of prior explanation, the noble Lord will agree, whether or not he assents to my arguments. But this is a matter which has engaged a good deal of Her Majesty's Government's attention since the Committee stage. It has certainly engaged mine.
LORD SHINWELL: My Lords, I should like to make a few observations on the point made by the noble Earl. He has referred to the apparently uneven amount of compensation which was required to be paid. In the clause under

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review there is something rather more uneven than the figures. It could happen that a union with 5,000 or fewer than 5,000 members might engage in what is regarded as unfair industrial practice and, as a result, create havoc not only for the industry or industries concerned but for a great many other industries and trade unions whereas a union with 100,000 members, or maybe even a million members, might engage in what may be regarded as an unfair industrial practice but of such a minor character as to create harm much less injurious than that created by a smaller union with a much lower membership.
That is where the uneven character of this provision emerges, and I should have thought, although the noble Earl did not agree with it, that on the whole it might be better not to specify the actual amount and limit of compensation but to leave the matter to be adjudged by the tribunal. The noble Earl said in that regard that it might involve a serious and adverse effect on the union or unions concerned. In matters of this sort, however, one has to judge by the nature of the offence and the relation of that offence to the position of other unions and other industries likely to be involved. I should have preferred an Amendment—if I may say so with great respect to my noble friend Lord Diamond, who has studied these matters more closely than I have—which expunged entirely the figures mentioned in the clause under review and left it entirely open to the industrial tribunal to decide.
With great respect to the noble and learned Lord the Lord Chancellor, I am putting the point to him because my knowledge of the law is uneven, and I have more often been at one end of the court than the other—though not for anything but political offences, such as obstruction at meetings. I venture to put to him the point that compensation in civil cases is not always specified in actual sums. It is left to the court to decide what should be the amount of compensation. Speaking again without any knowledge of the law or of the methods judges employ, or of how their minds work, I venture to suggest that they would determine the amount of compensation according to the nature of the offence, whether in a libel action or a
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civil case. Would it not be better, therefore, not to have a clause which specifies figures and amounts, and which is a kind of threat, a sort of shadow hanging over the trade unions, but rather to leave it to the good sense of those who will be on the industrial tribunal to come to a conclusion having regard to the nature of the offence? That is what I should have preferred, but I am in the hands of my noble friend Lord Diamond and my colleagues on the Front Bench—it is for them to decide. The uneven character of the figures does not interest me very much; I am more concerned about the uneven principle that is embodied in this clause. I would rather see that rejected than that the Bill should be rigid, and almost doctrinaire and definite, in a matter where one finds it impossible to be definite because of the possibly uneven character of the offence.
THE LORD CHANCELLOR: My Lords, though perhaps I should not do so, I shall rise to the fly cast by the noble Lord, Lord Shinwell. He is perfectly right. Of course courts award compensation in relation to the evidence, and in cases of this kind it will be in relation to the amount suffered, and this is so under the Bill. What the battle between the noble Lord, Lord Diamond, and the noble Earl, Lord Jellicoe, is about is the arbitrary limit set at various stages as a ceiling on compensation, not as a rigid yardstick by which compensation should be awarded but as a ceiling on what the courts can do. This exercise in mathematicianship is something that I will leave to the noble Lord, Lord Diamond, but it is not the sort of thing the noble Lord, Lord Shinwell, was complaining about.
LORD SLATER: My Lords, I was interested in what my noble friend Lord Shinwell had to say. I agree more or less with everything he had to say with regard to this item, although I have never looked at it in the same sense as he has done regarding the figures. As cited by my noble friend Lord Diamond in talking about the steps for the reduction from £25,000 to £18,000, the noble Earl the Leader of the House said that is not a crippling blow to trade unions. How many trade unions have we in this country recognised as such? The number of recognised trade unions, or forms of

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society with trade union standing, is anything from 200 to 300. They call themselves trade unions. The noble Earl and members of this Government ought to remember—and I have said this before this Bill was introduced—that there is the Whitley machinery inside the Civil Service in this country, and if you were to examine that Whitley machinery you would find that what I say is correct.
I can tell your Lordships that every employee works to a code principle that if he commits a misdemeanour he suffers the penalty of a loss of a day's work or two hours' work, or some such penalty. This is according to the conciliation machinery agreed between the parties. May I take it that all the conciliation machinery which has been operating within industry and the Civil Service is now to be cast out, following the introduction of this clause which relates to penalties which may now be imposed, and that trade unions will have to subject themselves to it irrespective of the forms of agreement drawn up in accordance with the Whitley machinery which have been in operation for such a long time? What has been said by my noble friend Lord Shinwell and the questions which I am posing relate to individuals whose terms of employment permit the employer to dictate the penalties for a misdemeanour or loss of production.
LORD DIAMOND: My Lords, I am grateful to my noble friends Lord Slater and Lord Shinwell for their support. I was particularly interested in what Lord Shinwell said about the recommendations he made to me. May I just explain that if I put down an Amendment to delete the parts of the Bill which I do not like, the Amendment would be one to leave out Clauses 1 to 166 (or whatever the figure is) and Schedules 1 to 9, and that would cover the matter. But at this stage, my Lords, I do not think we should make a great deal of progress by working in that way. So I have sought to put forward the most modest Amendment, and one which I felt sure the Government would be wise to accept.
I have not challenged the principle of limitation, or the principle of the steps, or the movement from step 1 of £5,000 to step 4 of £100,000. I have not challenged
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step 3, which is £50,000. I am merely saying that step 2 is absurdly out of line; and the noble Earl, who was good enough to give the matter further consideration, said that he hopes I am satisfied that lie has given the matter a great deal of further consideration. I am completely satisfied about that. I feel quite as benevolently disposed towards the noble Earl as was the schoolmaster towards the pupil to whom he had given the task of doing a sum, when the pupil came to him and said, "Not only have I done it at once, I have done it 10 times; and here are the 10 answers". I am not impressed with the noble Earl's arithmetic or the argument for the £25,000. It is clearly out of step. The figures he was good enough to add to it reinforce the extent to which it is out of step. But if the noble Earl is not prepared to move on the matter I do not think that we can do any more. I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 117 [Limit on compensation awarded under s. 103, s. 106 or s. 109]:
5.45 p.m.
LORD DIAMOND LORD DIAMOND moved Amendment No. 87C:
Page 89, line 13, after ("106") insert ("(except in the case of an award of compensation increased under the provisions of sub-paragraph (b) of subsection (4) of section 155 of this Act").
The noble Lord said: My Lords, as printed the Amendment refers to "section 155". I do not know why it refers to that clause, except that possibly it was so described in somebody's handwriting. If so, that was an error. It is perfectly obvious that the Amendment refers to Clause 115 and I hope that your Lordships will permit me to move it in that form. Clause 115(4) refers to the circumstances where on a complaint relating to dismissal an industrial tribunal has made a recommendation and that recommendation has not been complied with. It goes on to say:
"(b) if the tribunal or Court finds that the reason for which the recommendation was not complied with was that the employer in question refused or failed to make such an offer, and the tribunal or Court considers that he acted unreasonably in doing so, the tribunal or Court shall increase that assessment, to such an extent (in either case) as in the cir-

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cumstances the tribunal or Court considers just and equitable."
So we have a circumstance where a recommendation is made and an employer says, "Nothing doing". The Court or tribunal is satisfied that the employer has acted unreasonably in respect of the Court's recommendation over an unfair industrial practice and therefore the Court does the only thing it is allowed to do under the Bill; it increases the compensation or the amount payable—and I make no objection to that.
Also in the clause we are considering there are limits to the amount of compensation awarded under the various provisions. All I am proposing in this Amendment is that in respect of that circumstance—that is to say, a case of an award of compensation being increased under the provisions of the subsection I have read out—these limits should not apply. I think it right that limits should apply in other circumstances, but these are peculiar circumstances which deserve appropriate treatment. The appropriate treatment is described in the Bill and it would remove the discouragement to the kind of treatment referred to if the penalty were limited in the way described. I propose the Amendment to leave out that lightening of the burden.
THE LORD CHANCELLOR: My Lords, it is as well, I think, that we should see the context in which this Amendment is proposed. Clause 117 provides compensation for an individual workman in the case of unfair dismissal. There are two other clauses which for the sake of clarity I will ignore for the purposes of this argument as they are irrelevant in respect of this Amendment. It is the limit on the amount that an industrial tribunal can award to a workman. We were concerned to limit the amount which an industrial tribunal could award for a variety of reasons which were all canvassed in the course of the Committee stage debates. One which I think was acknowledged on both sides to be arbitrary, and equally acknowledged to be unavoidable, was that we have no idea as yet what the work load will be in the case of unfair dismissals, and we must not, therefore, leave the very largest claims to afflict the tribunal.
Another was that the tribunals are working in a new field and to give them
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an unlimited jurisdiction would be to give them jurisdiction equal to that of the High Court. They are composed of individuals perhaps not above, possibly not equal to, county court status, and it would be a step in the dark to allow them unlimited jurisdiction. These figures were arrived at on the basis of two years' pay at a figure of £40 a week. The latter figure was chosen to coincide with the limits under the Redundancy Payments Act, 1965, which is a respectable precedent and a comparatively recent one. We think that it is likely to cover all the probable cases.
The noble Lord, Lord Diamond, seeks to engraft an exception and to remove the limit in cases where an employer has been given a recommendation under the earlier clause to re-engage an employee and has failed to do so. It is common ground that compensation ought to be awarded in this case, so to that extent there is no difference between any of us. The question is whether this is a logical reason for exempting a case from the limitation which would otherwise have been imposed on the tribunal. But one can see that it is irrelevant in this case. I suppose that the justification for the noble Lord's proposal is that it is particularly bad if the employer is unwilling to comply with the recommendation. From some points of view I would agree with the noble Lord, but not from the point of view of the amount of compensation. That is awarded on the basis of actual loss. It is not a penalty.
I wish that we could avoid this idea altogether, because it is compensation for loss that is awarded, whether against a trade union in other cases or against an employer for unfair dismissal. There is no case for thinking that the actual loss to an employee is likely to exceed £4,160. Much the worst case that one can conceive of, from the point of view of actual loss, has nothing to do with moral obliquity on the part of the employer. It is the case where an employee either does not or cannot get another job. That is the case where the ceiling will come into question, and this is not more likely to happen where an employer has refused a recommendation of re-engagement than in any other class of case. It has nothing to do with the Amendment proposed. There are a good many points in this field where the two sides are not at odds with one

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another. I submit to the House that when we come to analyse the Amendment it is without merit and ought to be resisted.
6.23 p.m.
LORD SHINWELL: My Lords, attention so far has obviously not been directed to subsections (2) and (3) of the clause. Subsection (2) makes provision for the Secretary of State, presumably by issuing regulations requiring possibly an affirmative order in another place, to calculate the amount of a week's pay for the purpose of the preceding subsection. Subsection (3) makes it possible for the Secretary of State—and this applies more clearly to the Amendment proposed by my noble friend Lord Diamond—to issue regulations by order which would enable the sum mentioned in subsection (1) to be increased. It reads as follows:
"The Secretary of State may by order made by statutory instrument provide that, subject to such transitional provisions (if any) as may be contained in the order, subsection (1) of this section shall have as if, for the references to £4,160 and £40, there were substituted references to such larger sums as may be specified in the order."
So the Secretary of State has power to increase the amount from £4,160, based on a calculation of £40 a week, to a larger sum. But the point is that subsection (2) provides that the calculation should be on the basis of a week's pay, not £40 a week—£40 is the limit. A week's pay might be based on the standard rate, on basic pay; and in a variety of industries in the United Kingdom basic pay is much lower than the actual earnings that a worker receives. For example, in the engineering industry—and some of my noble friends associated with the union concerned may correct me if I am wrong—the basic pay is about £16·50 a week: my noble friend says £18. In the mining districts, it is much lower.
If the tribunal has to calculate on the basis of a week's pay in order to assess the compensation for any wrong done to a worker by an employer, then the amount of compensation would be very small indeed. As in the argument I ventured to adduce on the previous Amendment, on the amount of compensation that could be imposed on a trade union for committing an alleged unfair
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industrial practice, a great deal depends on the circumstances in each case. A worker on a lower wage may have a large family, though he may get family allowances and various fringe benefits. There may be ill health in the family. He may be paying higher rent, not affected by what has been told us to-day about the Government's proposed housing finance. Therefore, it seems to me that the figures are all irrelevant. The question of what a man should receive ought to be determined according to the circumstances—what he has been earning, not over a period of weeks but over two or three years; what his financial circumstances are; his way of living and the rest of it. I am bound to say that what is proposed is irrelevant to the situation that is likely to emerge.
Though I support my noble friend's Amendment, because in his wisdom he no doubt considers it the right thing to do, I point out that the Secretary of State can by order increase the amount but, on the other side of the coin, he can base the calculation on a much lower weekly pay, as a result of which the man concerned can be very adversely affected. I do not know why the Government have had to resort to this mathematical calculation, because it is not relevant, it does not make good sense, nor is it likely to provide good justice.
LORD DIAMOND: My Lords, again I am grateful to my noble friend for his support, and I look forward on the next Amendment to meeting his point of view even more clearly than has been possible on this Amendment. The noble and learned Lord who sits on the Woolsack has explained why he does not regard this as an exceptionally topical case. I have re-read the original terms carefully, and I can see that it need not necessarily be regarded as the worst of all cases. I still think that it should be excluded from the limit, but the noble and learned Lord is not prepared to help us. I do not think it would be proper to take up the time of the House further and, with your Lordships' permission, I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
6.2 p.m.
LORD DIAMOND LORD DIAMOND moved Amendment No. 87A:
Page 89, leave out lines 17 and 18 and insert—
("(b) £6,240 (that is to say 104 × £60 whichever is the greater.")
The noble Lord said: My Lords, I beg to move Amendment No. 87A. I hope that this Amendment will meet my noble friend Lord Shinwell's point more precisely, and that the Government will look upon it with considerable sympathy. At the moment, the limitation which is provided for the compensation payable is the amount of 104 weeks' pay or 104 times £40, whichever is the less. First of all, I want to say that £40 a week is rapidly becoming—and it looks like continuing its rake's progress—less impressive than at one time it was. Therefore, if one is going to look to the future, it is likely that £40 will increase to considerably more than £40 as an estimate of good weekly earnings. I have therefore sought to meet that point by providing for a figure, not of £40 a week but of £60 a week. The Bill will not be applied for some long time—one does not know how long yet—and it is reasonable to suppose that £60 a week will more likely be the figure that the Government will have in mind as an impressive figure than the £40 a week. So the first suggestion I want to put to your Lordships' House is that instead of having a figure of £40 a week, we should have a figure of £60 a week.
Equally, if not more important, is the proposal to remove the words "whichever is the less" and to substitute the words "whichever is the greater".
LORD BEAUMONT OF WHITLEY: Hear, hear!
LORD DIAMOND: That is really of fundamental importance, my Lords, and I am delighted to hear the distinguished representative of the Liberal Benches signifying his agreement. We have been over this case before. I do not know how the words "whichever is the less" came in. They are clearly not appropriate or just. Justice would require that there should be a figure calculated on the basis of £60 a week, but that if there was a higher figure earned, then the higher figure should be paid. It is as simple as that. There is, I realise, a provision under subsection (2) for the
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Secretary of State to calculate the amount of a week's pay, but I do not think that affects the broad point that we are making on this Amendment. I do not want to waste the time of the House in going over the arguments that we covered in Committee. I beg to move the Amendment as it stands and hope to get the support of the Liberal Party, if that support is necessary. But even more I hope—and I am sure that the Liberal Party feel the same way—that the Government will meet the Amendment, so that that support will not be necessary.
LORD BEAUMONT OF WHITLEY: My Lords, when we discussed this Amendment at the Committee stage, I made the point that I thought 104 weeks' pay was the right type of provision. I accepted that there should be a limit, but I thought, in fairness to everyone concerned, that it should be a limit related to the amount of pay which a person was earning. My noble friends and I wanted to see the removal of lines 16, 17 and 18 on page 89. But we were not successful, and so we come to this Amendment on Report stage. I still hold to my beliefs about that point. This Amendment obviously does not completely meet the point that my noble friends and I were making, but I think it goes quite a long way, particularly by substituting "whichever is the greater" for "whichever is the less". That will remove a great deal of injustice, as it seems to me, to those who earn more than £40 a week.
The noble and learned Lord on the Woolsack said that the Redundancy Payments Act 1968 provided a precedent for this particular sum of £40 a week. I follow Lord Diamond's argument, and I calculate that on compound inflation by the time this Bill comes into force £50 a week will be the equivalent weekly wage. The noble Lord, Lord Diamond, mentioned subsection (2). Subsection (3) gives the Secretary of State power to order by Statutory Instrument. But I think we should start higher than that. I think the real guts of this Amendment is in "whichever is the greater", and that this is a matter of ordinary justice between individuals. If compensation is going to be fixed, as obviously it is in some cases, on what a man's job is worth to him, then it should be based all the way through on the wages earned. Therefore we support the Amendment.
THE LORD CHANCELLOR: My Lords, listening to the two speeches that have just been delivered has led me to reflect in a melancholy manner on the inflationary effects of opposition. The Labour Party proposal for compensation for unfair dismissal relied in Clause 40 of their Bill upon a most elaborate formula which I shall not endeavour to recount. Not having done the computation myself, I have none the less able assistants who have done it for me. The maximum proposed by the Labour Bill in such cases as these was £1,920, except where a reinstatement order existed, when the maximum compensation was £2,640. Now, because we have suggested £4,160, or two years' pay, whichever is the less, they say that a great deal more is necessary in order to do justice between man and man. It leads me, I am sorry to say, to reflect, as I said, upon the inflationary effects of opposition. Of course the Liberal Party, which went much further, never having been in power at all within living memory, suffers from the complaint of the inflationary effect of opposition to an almost unlimited extent.
That really provides the short answer to this Amendment. I explained in answer to the last Amendment the general purpose of this ceiling, and once more am I surrounded like St. Paul with a cloud of witnesses. One, of course, is the previous Labour Government whose Bill I have already cited, but here again I rely upon the support of the noble and learned Lord sitting on the Cross-Benches, looking like a little cherub aloft. He said—and I am here quoting from paragraph 554:
" While we do not favour a scale of compensation, we think it desirable for practical reasons to fix a ceiling to the amount of compensation which can be awarded. This will make it easier for employers to insure against the risk of being obliged to pay compensation. It would in our view be reasonable to provide that the maximum should be an amount equal to the employee's wages or salary for two years; and that, as in the case of compensation under the Redundancy Payments Act, in the computation of this amount there should be ignored wages or salaries in excess of £40 a week—a limit the Secretary of State should have power to raise."
So the short answer is that we have done about twice as well as the Labour Party when they were in power, although not so far as the Liberal Party would be willing to go, never having
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known the realities and responsibilities of Office. Now we have gone the full length, at any rate in this modest respect, of what the noble and learned Lord recommended, and we are full of virtue and exuding unctuousness. I therefore suggest to your Lordships that the Amendment should be rejected.
LORD SHINWELL: My Lords, I am in full agreement with the rebuke of the noble and learned Lord who sits on the Woolsack to the Liberal Benches. They have no right to talk, because for many long years, as the noble and learned Lord the Lord Chancellor has just told us, they have not been responsible in any fashion for administration. So they have become completely irresponsible and whichever Amendment is accepted, any Amendment proposed by them I would reject.
LORD BEAUMONT OF WHITLEY: My Lords, may I ask the noble Lord whether he is at one with his own Front Bench, because on this matter I am at one with his Front Bench.
LORD SHINWELL: My Lords, there is one matter on which I would join issue with the noble and learned Lord the Lord Chancellor, and that is his reference to the propositions in the White Paper produced by the Labour Party and in their proposed legislation. Of course, the figures suggested by the Labour Government were much lower than the figures suggested by the Conservative Government in preparing legislation under this Bill; but when the Labour Government produced their White Paper and proposed legislation there was never a thought that after a couple of years or so a Conservative Government would be pitchforked into office and become responsible for a series of inflationary processes such as we have not witnessed so far this century. That is the position.
The Labour Government must not be blamed for the position. They were not aware that the economic position would become so serious, so transformed in such an adverse way as we are now experiencing. All the arguments adduced by the noble and learned Lord the Lord Chancellor fortified the contention that I ventured to put before your Lordships in the course of the debate on two previous Amendments; namely, the absurdity of

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being explicit and definite about figures. Of course it is impossible to foresee what the future will bring, to envisage the degree of inflation or reflation over a period of years—it is quite impossible. Who can tell? Speculation, conjecture and astrology should play no part in our calculations at all. We have to deal with the facts and what the situation is likely to be when a case comes before the industrial tribunal, as before a court of justice, and all the circumstances must be taken into account and a decision recorded. That is the sensible way of dealing with a situation of this kind. But I am bound to say that much which has been said this afternoon concerning these Amendments makes me feel the more convinced that it was unwise to introduce any figures at all. It would have been much better to have left the position open to be resolved by the good sense of those eminent people who are likely to be appointed to the industrial tribunal.
6.16 p.m.
LORD SLATER: My Lords, it is always interesting to listen to the noble and learned Lord who sits on the Woolsack, particularly when he begins to take the Labour Party to task because of the proposals which they seek to introduce. The thing which struck me very forcibly was that he keeps referring to the Donovan Commission's Report, but only when it suits his case. The Government and the Secretary of State were not prepared to accept the recommendations of that Commission in full detail, and to implement them. Why? They leave the door open because they seek to criticise what the Labour Government were prepared to do when they were in office and the proposals that they sought to bring forward for the benefit of people in this country. It is true, as my noble friend Lord Shinwell pointed out, that prices are shifting and the cost of living is going up. This has happened only because of the policies pursued by the present Government, and if they continue to pursue them prices will fluctuate even more. We talk of something in the region of £40 a week for people in industry. That figure will fluctuate, and that is why people are leaving the basic industries, such as the mining industry, and seeking an increase in wages of £9 a week at the present time. Therefore I say to the noble and
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learned Lord who sits on the Woolsack, "Yes, it is an old Parliamentary trick, and an old political method, that if you can find anything which has come from somewhere else and which you are not prepared to accept in toto, but only the parts that will advance your particular argument, then for God's sake take it and put it across." That is what the noble and learned Lord the Lord Chancellor has endeavoured to do in all our debates here when quoting the Donovan Commission's Report. I should have been very pleased if we could have got the noble and learned Chairman of that particular Commission on his feet to take the noble and learned Lord the Lord Chancellor to task, if at all possible, because of the statements that have been made.
LORD DIAMOND: My Lords, there are two issues involved in this Amendment: the minor one is the figure, and the major one is the essential element of justice. As to the figure, the noble and learned Lord who sits on the Woolsack has given us two examples of £4,160 (the figure given in the Bill) which are both dated 1968 or earlier. The Donovan Report was issued in June, 1968, and I believe that the Commission were appointed in 1965; so the recommendations speak for any time between 1965 and 1968. We know not when this Part of the Bill is likely to be implemented, but probably it will not be before 1972 or 1973. Therefore there is a considerable period of time involved. The Lord Chancellor's argument proves and proves conclusively, as all his arguments do, that the figure of £4,160 certainly cannot stand, nor can the reference to the Redundancy Payments Act, which again is an earlier reference, except in demonstrating that one thing is certain: that the figure of £1,460 is out of date. On these two conclusive arguments why do I say that the figure is of the lesser importance? Because, as has been pointed out, there is provision for this figure to be increased but we think it right that the target figure should be clearly indicated at the present time, and therefore that the figure should be based not on £40 a week but on £60.
The other argument which impressed me concerned possible injustice—and I do not want the noble and learned Lord to think I was not impressed by his

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argument about the noble Lord, Lord Donovan, looking like a cherub up aloft; I thought that was an excellent example. I was going to see whether he was suitably clad for this weather as a cherub, but perhaps that would not be quite in keeping with your Lordships' traditions. But the major point with which we are concerned is the essential injustice in having a lower figure than the real compensation based on so much a week. This was the essence of the Liberal Amendment
in the previous case. It is the greater part of our Amendment. We have had no reply to that of a satisfactory nature, and I therefore invite your Lordships to demonstrate our view on this Amendment in the usual way.
6.21 p.m.
On Question, Whether the said Amendment (No. 87A) shall be agreed to?
Their Lordships divided: Contents 56; Not-Contents 100.

CONTENTS

Addison, V.

Evans of Hungershall, L.

Popplewell, L.

Archibald, L.

Gaitskell, Bs.

Raglan, L. [Teller.]

Ardwick, L.

Gardiner, L.

Ritchic-Calder, L.

Beaumont of Whitley, L.

Garnsworthy, L. [Teller.]

Rusholme, L.

Bernstein, L.

Hall, V.

St. Davids, V.

Beswick, L.

Henderson, L.

Shackleton, L.

Blyton, L.

Heycock, L.

Shepherd, L.

Brockway, L.

Hilton of Upton, L.

Shinwell, L.

Buckinghamshire, E.

Hoy, L.

Slater, L.

Burntwood, L.

Hughes, L.

Sorensen, L.

Carnock, L.

Jacques, L.

Stocks, Bs.

Champion, L.

Janner, L.

Stonham, L.

Chorley, L.

Kennet, L.

Stow Hill, L.

Collison, L.

Kilbracken, L.

Taylor of Mansfield, L.

Davies of Leek, L.

Lindgren, L.

White, Bs.

Delacourt-Smith, L.

Lloyd of Hampstead, L.

Winterbottom, L.

Diamond, L.

Morris of Grasmere, L.

Wootton of Abinger, Bs.

Donaldson of Kingsbridge, L.

Nunburnholme, L.

Wright of Ashton under Lyne,

Douglas of Barloch, L.

Platt, L.

L.

NOT-CONTENTS

Aberdare, L.

Cullen of Ashbourne, L.

Macpherson of Drumochter,

Ailwyn, L.

Daventry, V.

Margadale, L.

Albemarle, E.

Denham, L.

Massereene and Ferrard, V.

Allerton, L.

Derwent, L.

Merrivale, L.

Alport, L.

Drumalbyn, L.

Milverton, L.

Amory, V.

Dundee, E.

Monck, V.

Balerno, L.

Ebbisham, L.

Mowbray and Stourton, L.

Balfour, E.

Eccles, V.

Napier and Ettrick, L.

Barnby, L.

Exeter, M.

Northchurch, Bs.

Belhaven and Stenton, L.

Falkland, V.

Nugent of Guildford, L.

Belstead, L.

Ferrers, E. [Teller.]

Oakshott, L.

Berkeley, Bs.

Ferrier, L.

O'Neill of the Maine, L.

Bessborough, E.

Fortescue, E.

Rankeillour, L.

Birdwood, L.

Fraser of Lonsdale, L.

Rochdale, V.

Bledisloe, V.

Goschen, V. [Teller.]

Rothermere, V.

Boston, L.

Gray, L.

Rothes, E.

Boyd of Merton, V.

Grimston of Westbury, L.

St. Aldwyn, E.

Brabazon of Tara, L.

Hailes, L.

St. Helens, L.

Brentford, V.

Hailsham of Saint Marylebone,

St. Oswald, L.

Bridgeman, V.

L. (L. Chancellor.)

Sandford, L.

Brooke of Cumnor, L.

Hankey, L.

Sinclair of Cleeve, L.

Brooke of Ystradfellte, Bs.

Hatherton, L.

Somers, L.

Brougham and Vaux, L.

Hood, V.

Stonehaven, V.

Buccleuch and Queensberry, D.

Hylton-Foster, Bs.

Strang, L.

Burton, L.

Jellicoe, E. (L. Privy Seal.)

Strange, L.

Carrington, L.

Kemsley, V.

Strathclyde, L.

Chesham, L.

Killearn, L.

Tenby, V.

Clwyd, L.

Kilmany, L.

Teviot, L.

Colgraic L.

Kilmarnock, L.

Vivian, L.

Colville of Culross, V.

Kinnoull, E.

Wakefield of Kendal, L.

Cork and Orrery, E.

Lauderdale, E.

Ward of Witley, V.

Craigavon, V.

Lloyd, L.

Windlesham, L.

Crathorne, L.

Loudoun, C.

Wrottesley, L.

Cromartie, E.

MacAndrew, L.

Resolved in the negative, and Amendment disagreed to accordingly.

Clause 118 [Contribution to compensation on complaint under s. 106]:
6.29 p.m.
LORD STOW HILL LORD STOW HILL moved Amendment No. 87B:
Page 90, line 23, at end insert (" in respect of any sum payable by way of any such compensation.")
The noble Lord said: My Lords, this Amendment relates to a very short point, and my objective really is to seek clarification and to remove possible ambiguity. Clause 118 provides for payment of a contribution at the instance of somebody who has been ordered to pay compensation for an unfair industrial practice and who claims a contribution against somebody who has induced him by pressure to embark upon that unfair industrial action. Subsection (3) of Clause 118 enables the tribunal, if it thinks that there is a case for contribution, to award such contribution as—and these are the relevant words—" to constitute a complete indemnity". I do not know whether those words are meant to include an indemnity for the costs of the proceedings. This is a small technical point. If one looks at the measure of compensation as defined in Clause 118, which enables expenses reasonably incurred by the complainant in consequence of matters to which the complaint relates to be taken into account, I should have thought that those words were not appropriate to cover the costs of proceedings. The words "to constitute a complete indemnity", read without any qualification, would include an indemnity as to the costs of proceedings. Those costs may be very heavy and one should know what is the intention of the Government with regard to this matter. Do they intend the indemnity to include the costs of the proceedings or do they not?
By this Amendment I seek to put in words which will make it perfectly clear that the indemnity will extend to the whole figure ordered to be paid by way of compensation but will not go beyond that and include any indemnity as to costs. I personally think that an indemnity as to the amount of compensation would be adequate, but I have not a very strong view about it, one way or another. I would prefer that it should not include costs. Therefore my first question to the Government would be
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this: do they intend the indemnity to be one which could include costs? If the answer to that question is "No", then I would submit that in order to make that clear beyond a misunderstanding it is necessary to include some words such as I have put on the Marshalled List, namely:
"in respect of any sum payable by way of any such compensation".
I beg to move.
THE LORD CHANCELLOR: My Lords, this matter is limited to proceedings under Clause 106; namely, proceedings before an industrial tribunal for unfair dismissal. I was not aware that it was the practice of the industrial tribunals to award costs. If it is, they are minimal, and if it is their practice, then the intention of the Government is that the indemnity, if any, should not include them. I will consider this matter further as I was given a slightly different idea of the purpose of the Amendment when I was preparing myself to meet it. I thought the noble Lord was making a different point and I was prepared to answer that point, but I will let the noble Lord have a more considered statement. The position about costs in industrial tribunals is that regulations may include provision for the award of costs or expenses, including allowances payable under Section 12(3) of the Industrial Training Act, other than allowances payable to members of industrial tribunals or assessors, but I do not fancy that these will be at all substantial. The intention is that the indemnity should not include the award of costs.
LORD STOW HILL: My Lords, I am grateful to the noble and learned Lord, first, for the intimation he has given as to the intentions of the Government and, second, for the statement he has made that he will go into the matter further. With that expression of gratitude, may I ask the leave of the House to withdraw the Amendment?
Amendment, by leave, withdrawn.
Clause 121 [Action initiated by Commission]:
LORD DIAMOND: My Lords, the purpose of putting down Amendment No. 88 is to persuade the Government of the merits of it. If one has succeeded in that,

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one should waste no more time. I beg to move.
Amendment moved—
Leave out Clause 121—(Lord Diamond.)
LORD DRUMALBYN: My Lords, I am grateful to the noble Lord for his brevity. The noble Lord put down an Amendment which we discussed on the Committee stage of the Bill, and I said that I would reconsider the clause in the light of what he had said. We have done that and we accept his Amendment.
LORD DIAMOND: My Lords, I am most grateful to the noble Lord. I had hoped that this was one of the reasons why he had added his name to the Amendment.
On Question, Amendment agreed to.
Clause 122 [Report of Commission on reference under s. 120]:
EARL FERRERS: My Lords, I beg to move this Amendment on behalf of my noble friend, and perhaps at the same time we might consider the following three Amendments, all of which are consequential upon the deletion of the last clause. I beg to move.
Amendment moved—
Page 92, line 30, leave out (" (a) ").—(Earl Ferrers.)
On Question, Amendment agreed to.
EARL FERRERS: My Lords, Amendment No. 88D is consequential upon the previous Amendment. I beg to move.
Amendment moved—
Page 92, line 33, leave out from ("Act") to end of line 36.—(Earl Ferrers.)
On Question, Amendment agreed to.
EARL FERRERS: My Lords, this Amendment No. 88E is also consequential. I beg to move.
Amendment moved—
Page 92, line 38, leave out ("or of the regulations").—(Earl Ferrers.)
On Question, Amendment agreed to.
EARL FERRERS: My Lords, I beg to move Amendment No. 88F.
Amendment moved—
Page 92, line 38, leave out from ("to") to ("and") in line 40 and insert ("that question").—(Earl Ferrers.)
On Question, Amendment agreed to.
Schedule 3 [Chief Registrar and Assistant Registrars, National Industrial Relations Court and Commission on Industrial Relations]:
6.39 p.m.
LORD STOW HILL LORD STOW HILL moved Amendment No. 88A:
Page 139, line 31, after ("of") insert ("mental or physical").
The noble Lord said: My Lords, I think I can take this matter quite shortly. On the Committee stage we had a considerable amount of discussion on the need for the Industrial Court and the members of the Industrial Court to be seen to be, and recognised as being, a completely independent tribunal and entitled to the public confidence that goes to any tribunal in this country. There was some discussion as to the power of the Lord Chancellor and the Secretary of State to remove an appointed member on the ground of incapacity or misbehaviour—a power which resides in paragraph 6 of Part II of Schedule 3. The noble and learned Lord felt that the power to remove would not really trespass upon the respect owed to an independent tribunal of that sort, upon the basis that it did not really vest in the Executive any excessive power of removing an appointed member, and his ground for so thinking was that the words "incapacity or misbehaviour" enshrined, as it were, the comparative irremovability of appointed members. Clearly, the Lord Chancellor and the Secretary of State must have a right to remove an appointed member for misbehaviour, and the question really centred upon the word "incapacity". The discussion was whether the power to remove for incapacity was in any sense open to criticism. The noble and learned Lord's view was that it was not open to criticism, upon the basis that it would be construed as meaning incapacity (may I use the expression broadly) on the ground of some physical or some mental limitation. If it is so construed, I personally would not have the least possible criticism of it. Clearly, the Lord Chancellor and the Secretary of State, in the event of an appointed member becoming incapacitated in that sense in carrying out his duties, must have the possibility of removal.
I am not arguing that that is not in fact what would be attributed as the meaning of the word "incapacity". All I am seeking to do is to put it beyond any possible doubt that the word "incapacity" is limited in that sense. In order to remove any conceivable doubt, this being a matter of important principle, I seek to add the words "mental or physical"; in other words, the power of removal would arise only on the ground of mental or physical incapacity, or misbehaviour. The addition of the words I propose would, I submit, make it perfectly obvious, so far as the appointed members are concerned, that, apart from misbehaviour, they hold their office without any possible fear of interference from the Executive unless they are physically or mentally unable to do that for which they are appointed. That, I submit, is the right result. It is the intention of the Government, as I think the noble Lord made clear, and it is an intention I would entirely endorse, if I may respectfully say so. I simply seek to put it beyond the least question that that is the only situation in which the power to remove could arise, apart from misbehaviour; namely, if it is demonstrated that the appointee has become mentally unable to do the work, owing to nervous breakdown or something of the sort, or physically unable to do the work. I beg to move.
6.44 p.m.
EARL FERRERS: My Lords, we are grateful to the noble Lord for having moved this Amendment. I should like to say at the outset that I do not think there is anything of difference between us at all. As he explained, my noble and learned friend is just as anxious as is he to see that "incapacity" covers mental and physical incapacity. The noble Lord will remember that when the Bill was first introduced the words which we had in the Bill were different from those that we have now: the words were "unfit to continue in office or incapable of performing his duties". Noble Lords opposite considered that this was not quite so specific as it should be, and it was for that reason that the Government moved an Amendment at the Committee stage to import the words now in the Bill. These particular words, "incapacity or misbehaviour", were the words which the
264
Opposition in another place had used in the Courts Act. I suggest to the noble Lord that it would be desirable that the same phraseology should be used in this Bill as in the other, in order to avoid any possibility of misrepresentation. I am quite certain that the Bill will be interpreted only as it is intended, which is that "incapacity" should refer to mental and physical incapacity. But I would suggest that it would be best for this Amendment not to be accepted, simply in order that the legal phraseology may be kept the same in different types of legislation.
BARONESS GAITSKELL: My Lords, I intervene not so much to support the Amendment as to oppose paragraph 6, which I think is absolutely ridiculous. The whole thing is really laughable. It is the kind of sentence or phrase that might be put into any contract or at the end of any kind of rules and regulations for governing boards. It is completely obvious and quite unnecessary.
LORD DONALDSON OF KINGS-BRIDGE: My Lords, without going so far as to agree with everything that my noble friend has just said, I would support this Amendment on the grounds that the word "incapable" has a perfectly clear meaning which does not necessarily involve either mental or physical, incapacity; in other words, it is perfectly possible for a Home Secretary, for political reasons, to say, "This man is incapable; I am going to sack him". That could never be proved, whereas if we limit it to mental and physical, these terms are subject to proof. I think there is substance in the Amendment, and I think it should be looked at very carefully.
LORD STOW HILL: My Lords, I am grateful to both my noble friends for their contributions and to the noble Earl for his answer. May I say to my noble friend who has just spoken that the point I was trying to make was much better expressed by him than by me. I feel that "incapable" is just conceivably susceptible of the meaning of incompetent, and whilst I think, if one is using percentages, that "incapacity" is probably about 95 per cent. safe, I was trying to make it 100 per cent. safe. On the other hand, I see the force of the argument that, as a matter of draftine, it is not desirable to

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use the word "incapacity" in the Courts Act and to use a different connotation of words in this Bill. The result of so doing is that attention is called in the course of argument, should it ever arise, to the difference of wording between the two Acts, and it is sought as a result to limit or extend one set of words or the other. Weighing those considerations, the slight uncertainty, on the one hand, and the difference in the wording, on the other, I feel convinced, on balance, and persuaded by what the noble Earl has said, that it is probably not desirable to press the Amendment, and I would ask leave to withdraw it.
Amendment, by leave, withdrawn.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 88B:
Page 140, line 46, leave out ("practicable") and insert ("appropriate").
The noble Lord said: My Lords, in the absence of my noble friend, may I move this Amendment with which my name is associated? Your Lordships will recall that in Committee the noble Earl, Lord Dudley, moved an Amendment part of which would have substituted "appropriate" for "practicable" in this paragraph. On that occasion my noble friend Lord Jellicoe said that the suggestion appealed to him and he undertook to look at it between then and Report stage. We have looked at it, and I do not think I need do more than say that we are grateful to my noble friend for having brought this matter to our attention. My noble friend Lord Jellicoe was not able to agree with everything that was said on that occasion, but he did express the feeling that in regard to the word "practicable" the appropriate word was "appropriate", and the Amendment would substitute that word for "practicable". I beg to move.
On Question, Amendment agreed to.
6.50 p.m.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No 88G:
Page 140, line 46, at end insert ("and except as provided by sections 82(7) and 146(6) of this Act, and except in proceedings on an appeal under section 113 or section 114 of this Act, the Industrial Court shall not be bound by any enactment or rule of law relating to the evidence which is admissible in proceedings in other courts.")
The noble Lord said: My Lords, the aim of this Amendment is to release the
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Industrial Court from strict adherence to the rules and laws of evidence. The Government have repeatedly indicated their intention that the Industrial Court should be a plain man's court, and that is why it has its tripartite composition, which is somewhat unusual. That is why it has the discretion it will enjoy in awarding its remedies; and that is why we intend that informality will characterise its proceedings. In order to do justice to this conception the Industrial Court must be as flexible as possible in its procedure, and that is the principal reason for the Amendment. Adherence to the rules of evidence normally observed in the courts would, for example, oblige parties to follow various Rules of Court laid down in the Civil Evidence Act 1968 before certain statements could be produced in evidence. The court would also be restricted in the types of second-hand hearsay evidence which would be admissible. In this matter we are following the practice of industrial tribunals, which are similarly free from the obligation to observe the formal rules of evidence. This follows from the regulations made under Section 46 of the Redundancy Payments Act 1965. The wording there in this respect has been carried over into Schedule 6 of this Bill. Industrial tribunals will continue to enjoy freedom from the formal rules of evidence, and the Amendment puts the issue beyond doubt in respect of the Industrial Court.
Perhaps I may say a word about the two exceptions contained in the Amendment. First, when the Industrial Court is hearing appeals from decisions of an industrial tribunal or the Registrar, such appeals will, at least in the case of tribunals, be entirely on points of law, with legal representation highly probable. The facts will generally not be in dispute. Since the proceedings are likely to consist mainly of technical argument between opposing counsel, there is little purpose in suspending the normal law of evidence. The second exception concerns information given to the Registrar or to a conciliation officer in the course of their conciliation duties. Since it is important that the relationship between the conciliator and his client should remain confidential and free from inhibition, Clauses 82(7) and 146(6) provide that what was said, or conveyed, during conciliation shall not be revealed in subsequent proceedings without the consent of

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the party concerned. The Amendment retains this protection.
I fully recognise that noble Lords opposite would prefer that this Bill did not establish the new Industrial Court at all. Given the intention of the Government that this Court shall be established, it is surely in everyone's interest that it should work effectively. By this I mean that the Court should deal flexibly, informally, and speedily with all the different types of case that come before it. This will, of course, be to the advantage of all who appear before the Court, whether as applicants, complainants, or respondents. I therefore commend the Amendment to the House as a useful means of increasing the Court's effectiveness, and I hope the House will agree.
LORD STOW HILL: My Lords, I should just like to ask a question with regard to this Amendment. I am entirely in sympathy with the spirit of it. I think that the greater freedom which this allows does conduce better to the purposes of that part of the Bill which relates to the legal proceedings, whether that part is right in principle or wrong. I cannot quite understand what the effect of the exceptions in relation to appeals under Clauses 113 and 114 of the Bill is going to result in. One is there considering an appeal to the Industrial Court. The tribunal from which the appeals come—whatever the tribunal may be, whether it is the industrial tribunal or any of the others specified in the Bill—will have been free of any limitation as to the type of evidence that it is to consider, and the rules on which that evidence is to be tendered. Then, when the matter goes on appeal to the Industrial Court, the clamp is to come down; the rules as to evidence, as they are normally understood, must then be put into operation and obeyed. I think that is right.
Not infrequently a situation arises in which, in an appellate court, even though the matter may be one strictly of law, it becomes necessary to consider some issue of fact which was not decided in the court below but upon which the issue of law depends. If that issue of fact, in the rare case, should come before the appeal tribunal and the appeal tribunal should decide that evidence must be given as to that fact, that evidence is apparently to conform to the rules of evidence. Some
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of the facts, therefore, before the appeal court will have been ascertained in the court below without the rules of evidence being applied; other facts will have been ascertained in the appellate court, the rules of evidence having been strictly applied. It seems to me that great inconvenience may result. The result of applying the rules of evidence may produce a different finding in a given situation of fact.
Perhaps I may continue while the noble Lord gains sustenance from his advisers? There probably is a simple answer to this, but if there is not I would suggest that the Government should consider this a little further, because some rather bizarre results might eventuate from the application of two systems of evidence brought into play in relation to a set of facts on which a given case depends in the appellate court.
LORD DRUMALBYN: My Lords, I am grateful to the noble Lord. I was anxious to know whether the existing jurisdiction of the industrial tribunal over the Redundancy Payments Act covered an appeal and, if so, whether the same kind of circumstances existed there as those he is talking about. I am assured that the same kind of circumstances do exist. There is, at the present time, an appeal to the High Court, and presumably in the High Court the laws of evidence apply with their full vigour. If that is so I should have thought that exactly the same thing would occur in regard to an appeal from the industrial tribunal to the Industrial Court on a matter of law. I hope that is a satisfactory answer.
LORD STOW HILL: My Lords, if the House would be so kind as to allow me to say two words, may I thank the noble Lord and sympathise with him in having this sort of thing shot at him. That is the fate of a Minister, and he is very gallant in his dealing with these points. The mere fact that there is a precedent does not ensure that it is a good precedent, but I do not take it any further.
On Question, Amendment agreed to.
6.59 p.m.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 88H:
Page 141, line 24, leave out ("(e) of section 155(1)") and insert ("(f) of subsection (1) of section 155").
The noble Lord said: My Lords, I beg to move Amendment No. 88H, and may I invite the House to consider Amendment No. 88J at the same time. These are forward-looking Amendments. They are contingent really upon the acceptance by the House of Amendment No. 93J which, as noble Lords will have seen from the Marshalled List, seeks to add to the categories of information protected from disclosure under Clause 155 an additional item; namely, any information obtained by an employer for the purpose of bringing a prosecution, or defending any legal proceedings. Of course it would be wrong for me to anticipate what the House might decide on Amendment No. 93J, but for the purpose of enabling us to have a meaningful discussion on these Amendments to Schedule 3 it would be helpful to assume its acceptance for the time being.
Where a trade union disputes an employer's claim that information it has sought under Clause 56 is protected from disclosure by Clause 155, the matter will have to be resolved by the National Industrial Relations Court. Clearly, where the purpose of the proceedings is to determine whether the information in question is protected—for example, whether it is personal or confidential information falling under subsection (1) of Clause 155—the Court should be able to hear the evidence in private, and paragraph 20 of Schedule 3 enables its rules so to provide. The purpose of these Amendments is therefore simply to enable the Court's rules to allow it to hear in private evidence consisting of legally privileged information. I hope the House will agree that such information should enjoy the protection afforded by Clause 155, when we debate Amendment No. 93J. Amendments Nos. 88H and 88J are really consequential drafting Amendments to the Schedule and this, I am afraid, is a consequence of the order in which we are taking the business. My Lords, I beg to move.
LORD STOW HILL: My Lords, I hope that the House will agree to this Amendment. Amendment No. 93J is in the name of the noble Lord, Lord Drumalbyn, my noble friend Lord Diamond and myself and, as has been said, this Amendment is consequential on that.
LORD DRUMALBYN: My Lords, I am much obliged to the noble Lord. This is the second time that we have anticipated Amendments which we are going to accept.
On Question, Amendment agreed to.
LORD DRUMALBYN: My Lords, I beg to move Amendment No. 88J.
Amendment moved—
Page 141, line 27, leave out ("the said paragraph (e)") and insert ("paragraph (e) of that subsection").—(Lord Drurnalhyn.)
On Question, Amendment agreed to.
LORD DRUMALBYN: My Lords, I suggest that this may be a convenient moment to break for an hour. I beg to move that further consideration of this Bill be adjourned, to enable the Mersey Docks and Harbour Bill to be considered on Second Reading.
Moved accordingly, and, on Question, Motion agreed to.

MERSEY DOCKS AND HARBOUR BILL
7.3 p.m.
LORD NUGENT OF GUILDFORD: My Lords, I beg to move that this Bill be now read a second time. The Mersey Docks and Harbour Board owns and manages the world-famous Port of Liver-pool and Birkenhead, and the Board is now promoting this Bill to provide for the reconstruction of the constitution and capital of the business. The need for reconstruction arises out of the very serious financial crisis which came to light last year. This has all been very fully reported in the Press, including the protracted proceedings in another place, and therefore I think it will only be necessary for me now to record the bare facts.
The facts are that in the past four years the Board has been making trading losses, culminating last year, in 1970, in a deficit of some £3 million. In addition to that, and even more serious, the Board has an obligation to redeem bonds to the amount of £6·2 million which fell due for repayment on January 1 of this year. The Board could not redeem them. A firm of independent accountants who were asked to report on the financial position of the Board showed that the net cash deficiency which the Board faced by the

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end of 1973 was some £20 million-plus. The background picture is also one of great anxiety. Over the five years, 1965 to 1969, there has been declining traffic in the port. While the total shipping tonnage of all British ports increased by about 5 per cent., that of Liverpool decreased by 16 per cent. I state these financial and economic facts to explain the gravity of the port's position and, therefore, the drastic nature of the measures needed to restore solvency.
There has been a disposition in some quarters to blame the Government for the drastic nature of the reconstruction proposed. But I suggest that a monetary consideration of the financial position of the Board which I have outlined makes it plain that nothing less than drastic measures could restore solvency in the circumstances I have indicated. In fact, it should be recorded in passing that the Minister for Transport Industries is providing the whole of the finance for the new Seaforth installation, amounting in total to some £40 million. About half of that sum has already been paid and the balance will be paid over the next year or two as the work is completed. As the port's future prosperity largely depends on the Seaforth container installation, it is evident that the Minister is playing a major part in bringing about the port's recovery.
Turning now to the Bill's proposals for modernisation of the constitution and capital structure, I should first say one word about the existing structure. The Mersey Docks and Harbour Board was set up in 1857 as a public trust authority—there have been some amendments in the interim, but it is substantially the same—with Board membership largely constituted by port users. There was clearly an underlying intention to provide safeguards against the exploitation of the monopoly position which the great Port of Liverpool had during the 19th century. Similarly, the capital structure was designed without equity capital which might have given an incentive to exploit this monopoly. So all the capital is in the form of fixed interest charges, mostly dated. It is only necessary to mention these two major features of the present Board to indicate the wildly unrealistic nature of the structure to-day. There is the port of Liverpool, which has lost 16 per cent. of its trade in five years, and
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far from having a monopoly of its shipping trade is literally fighting for its existence in a fiercely competitive world. So that the constitution is as obsolete as, I fear, is much of the port installation and reconstruction is long overdue.
Let me turn to the main proposals in the Bill for the new structure. First, the Mersey Docks and Harbour Board will be transformed into a statutory company subject to the Harbours Act 1964, and charged with the principal duty of carrying on the port of Liverpool and Birkenhead, plus port conservancy and pilotage services. Secondly, an interim board will be appointed, the majority of whom will represent the bond holders, plus a minority of Government nominees in recognition of the large-scale Government lending. I should say in passing, my Lords, that of course the old board in no way represented the bond holders and they could not have been worse placed to express their views. Thirdly, this interim board will be charged with the duty of formulating a definitive capital reorganisation scheme by June 30, 1973. I should mention, my Lords, that the Bill originally contained the date of June 30, 1974, that is, a year later, but an Amendment in another place advanced this date by one year in order to speed up the introduction of the definitive scheme. When formulated, this scheme must be submitted to the debenture holders for their approval.
Fourthly, each class of redeemable capital debt in the existing Mersey Docks and Harbour Board will be converted into a class of redeemable debenture stock of the company, with unchanged rights of interest and redemption. Similarly, the annuity will be coverted into irredeemable debenture stock with the same interest rates. Fifthly, these interest rates will be maintained only until this Bill becomes an Act. Thereafter, until the definitive scheme becomes effective, first the debenture stock falling due for redemption will not be redeemed, and secondly, interest will be paid at not less than 70 per cent.; in other words, there is an indication of a cut of up to 30 per cent. in interest rates. Loans made after November 27, 1970, that is to say new Government loans, will rank for full repayment, but the Government have waived this right in respect of some £1·2 million of loan which was promised before that date but paid after.

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Sixthly, my Lords, the receiver will be discharged so that the new statutory company can proceed to work independently; and, seventhly, there is a special provision in the Bill, in Clause 47, for the repayment of bond holders with £500 or less stock during the moratorium period. This is related to bond holders in receipt of small incomes relief. This Amendment also was added in another place to meet what could be hard cases. This is not an exhaustive account of a lengthy Bill, but I think it covers the main points which your Lordships would wish to hear about.
I should just like to make two further general points. The first is that the new chairman, Mr. Cuckney, has stated that the definitive scheme, when it is completed, is not likely to be less drastic than that outlined in his circular to shareholders of last November; that is to say, a write-down to 70 per cent. of the capital and a rolling forward of redemption dates for debentures. I have had the opportunity, my Lords, of discussing this in general terms with Mr. Cuckney and he told me that in his judgment at present the Board is seriously over-capitalised, especially in the light of the obsolescence of much of the port installations. Inevitably this implies the necessity for a substantial write-down of capital if the new company is to recover solvency and pay its way.
Mr. Cuckney told me that he is willing to consider creating equity capital in the new definitive scheme which could be allocated pro rata to the debenture holders as off-set against the write-down of the value of the debentures. This point also was mentioned in another place, and could have some importance. If and when the new company becomes profitable in the future the debenture holders would receive some compensation for their present loss. In passing, my Lords, I would like to congratulate the Mersey Docks and Harbour Board on securing Mr. Cuckney's very expert services as chairman. To be chairman of that Board at the present time is not a job for which there would be much competition, and I think that we may be very grateful to him for taking it on.
There is a second general point I should like to make, and to which I feel I should address some remarks. It is on the question of Government responsibility
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towards the bond holders of the Mersey Docks and Harbour Board. When I took up this Private Bill, my Lords, I confess that I had some feeling of anxiety on this score and therefore I have looked very carefully at it. These debentures have, as your Lordships will know, been rated as trustee stock, but it is clear to me that the Government have no legal obligation towards the stock holders. This seems to be firmly confirmed by the fact that three banks and Crown Agents joined together and petitioned on these grounds before the Committee in another place; and in substance their petition did not succeed.
The fact that the Government have four nominees on the Board and have lent money to the Board may very well have influenced the Stock Exchange in rating the stock as trustee stock; but it is quite clear that the stock is in no way comparable to Treasury stock, which of course has the unequivocal guarantee of the Government behind it. Therefore, much as I sympathise with the bond holders, I have concluded that Government would be wrong to accept this liability and to saddle the taxpayer with the cost of meeting it. I conclude by commending the Bill to your Lordships in the belief that it will initiate a new era for the great Port of Liverpool, with a modern constitution, competent leadership and substantial new Government finance for the modernisation of the port installation. My Lords, I beg to move.
Moved, That the Bill be now read 2a.—(Lord Nugent of Guildford.)
7.19 p.m.
LORD BESWICK: My Lords, we are all obliged to the noble Lord, Lord Nugent of Guildford, for explaining the genesis and purposes of this Bill. If there is any noble Lord in the House capable of persuading us that this Bill should go to a Select Committee without further comment it is the noble Lord, Lord Nugent. But I am sure that it would be quite wrong to send this Bill to a Select Committee without voicing the deep disquiet that the implications of the Bill have aroused. It is a Private Bill, my Lords, and as I have said, it is introduced into this House by one of the most respected among us. But that does not

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disguise the fact that it arises from Government decisions as the result of a situation for which the Government have some responsibility, and the Bill ought to have been brought to Parliament by a Minister of the Crown and justified by that Minister on behalf of Her Majesty's Government.
My Lords, the Mersey Docks and Harbour Board is one of the oldest public boards in this country; I think that 1857 was the date the noble Lord mentioned. Until the present Administration took over, the stock of this Board was, as the noble Lord said, trustee stock. It was thought to have all the disadvantages of Government stock, public authority stock, but the advantages of that stock as well; namely, that although there was no dynamism about it, there was no inflation proofing about nevertheless, one could think that the amount was secure.
Now we find this was all a misconception. The stockholders of Rolls-Royce thought that they were reasonably safe, but their grounds for that belief were certainly not as respectable as those of the stockholders of the Mersey Docks. The noble Lord, Lord Nugent of Guildford, said there was no legal liability resting upon the Government. One accepts this if one looks at the absolutely narrow definition of "legal liability". I cannot believe that there was not some ground for the Government being somewhat more involved, interested and, indeed, generous, than they have been.
The income of the stockholders has now been reduced by 30 per cent. Their position in the future under the proposed scheme, when it is known and applied, apparently is absolutely uncertain. The question is whether any certainty or comfort can be offered to them. I believe that one suggestion that was put forward in another place was that there should be a floor written into the Bill and that they should be guaranteed as to something like 50 per cent. of their previous income. The proposal was turned down, on the grounds that if half their previous income could not be provided then we should be back in square one and other legislation would be needed. That suggests that even 50 per cent. of their previous income cannot be expected. I noticed the noble Lord was most interesting in his explanation that the prospects
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of the new company were reasonable, that they are now under very capable direction and there is some chance that a fresh start will lead to better financial results. In that case, I wonder whether it would not be feasible to have some sort of cushion, floor or guarantee in the Bill which would give some comfort to the stockholders for whom the noble Lord expressed a good deal of sympathy.
That leads me to this question: can the noble Lord, or the Minister who will speak for the Government, tell us what opportunity will there be if we agree to this Bill going upstairs to the Unopposed Bills Committee, for evidence to be taken from stockholders or their representatives? How can the Committee assure themselves that it is not technically or financially feasible to write into the Bill something of the guarantee that I have mentioned? Will it be possible to take evidence from representatives of the stockholders? Will they be invited to give evidence? Will it be feasible for witnesses to be given the necessary assistance to enable them to appear before this Committee? I have been taught—and nothing that I have known has upset the belief that I have acquired—that the Select Committee on Private Bills in this House functions admirably. I am a little unhappy that this Bill goes to the Committee, unopposed as it is, partly because the stockholders themselves are not in a position to organise and put forward their case. I ask the noble Lord whether he can give us any assurance that their interests are going to be carefully considered by the Committee, if we agree that the Bill should go upstairs to the Committee.
7.25 p.m.
LORD SANDFORD: My Lords, this may be an appropriate point for me to make clear the Government's views on certain aspects of the Bill. When the Board were first faced with the financial crisis last autumn, they consulted my right honourable friend, the Minister of Transport, and a series of meetings took place. Having considered the situation following these, the Government were clear that it would be quite wrong, and contrary to their policy, to burden the taxpayer with the Board's liabilities to their security holders. However, they were fully aware of the problems involved and of the hardship caused to

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many of the small investors who, as my noble friend said, had considered the Board as "safe as the Bank of England". The matter was regarded nevertheless as essentially one for the Board themselves to solve and this the Board accepted. In the view of Her Majesty's Government, it was no solution to bail out the Board.
The effects of the crisis extended beyond the interests of the investors. Her Majesty's Government decided that assistance towards the financing of the new Seaforth Dock, so vital to the Port's future, should continue if at all possible, all the money for the scheme being provided by the Government through grants and loans under the Harbours Act 1964. On the understanding that the Board took all practical measures to ensure the future viability and stability of the whole Port of Liverpool, the Government undertook to make available further loans for Seaforth.
The only course open to the Board was to ask Parliament to enable them to take urgent short-term measures, including a moratorium on capital redemption and interest payments, and also to prepare for the longer term by way of a capital reconstruction. The Board's first Bill, prepared in great haste, proved unacceptable and was withdrawn—this second Bill, recently given its Third Reading in another place, has the Government's full support.
It has been suggested—and the noble Lord, Lord Beswick, has repeated the suggestion—that the Bill should have been a Government Bill. But the Board was created by private legislation. It was responsible for its own finances. In order to deal with the financial situation legislation was required. Clearly it was the Board's responsibility to promote such legislation. It does not follow that because the Board asked the Government for assistance the Government should promote the Bill.
The Government have, of course, been concerned, as the noble Lord, Lord Beswick, was concerned, that all security holders should receive equitable treatment, and they consider that this is provided by the Bill which also ensures—and this, perhaps, will go some way to meet his inquiry—that security-holders
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will have an important role in the new statutory company.
The Government are also a major secured creditor and it has been accepted that loans made or committed to the Board prior to November 27, 1970, should be treated in the same manner as all other investments made up to that time—these loans will therefore be subject to the terms of the scheme of capital reorganisation which the new Board of Directors will have to prepare under the Bill's provisions.
The Bill does, however, provide for all loans made since that date to receive priority ranking, as regards security. It is only right that loans made in the present circumstances should be afforded this measures of protection. However, as my noble friend Lord Nugent of Guildford said, the Government have already made it clear that the priority will be given up when an acceptable scheme of reorganisation has been introduced.
Faced as we are with the Board's present situation, there is nothing at all to be gained—and no noble Lord has attempted to pursue this—from rehearsing all the things that went wrong in the past. Post mortems, and attempts to apportion blame, will serve no useful purpose. The aim of the new Board and of their Chairman, Mr. Cuckney, is to put an end to the uncertainties that have been hanging over the port, and look to the future—a future in which all concerned with the port can work together to ensure its future prosperity. It is clearly essential therefore that the Board should be able to put their affairs in order as the Bill provides. The passage of this Bill without delay is the best way in which the port's future can be secured. It will enable the Government to continue with financial assistance for the Seaforth Scheme, which is vital to the future viability of the port. In that way the livelihood of those associated with the port will be protected and the best interests of the Merseyside region will be served. We believe that this Bill provides the best way of protecting the interests of those who have invested in the Board by giving them a stake in what we hope will be the successful future of this new Company, and a voice in the way in which it is to be run. I therefore ask your Lordships to give this Bill a Second Reading.
LORD BESWICK: My Lords, is not the Minister going to comment at all upon the questions I asked about the extent to which the Committee, if we agree that the Bill should go to that Committee, would be able to assure themselves on the basis of the evidence about the financial position of the Company and of the stockholders?
LORD SANDFORD: My Lords, the point I was making in response to the question asked by the noble Lord was this. I think that the interests of the stockholders are going to be better secured. The main point is that their interests will be secured by their having a voice in the running of the Company.
LORD BESWICK: My Lords, the noble Lord is saying that. What I am asking him is: How are the Committee who are due to consider this Bill going to assure themselves that what the Minister is saying is in fact the position?
LORD SANDFORD: My Lords, as the noble Lord said, this Bill will go now to the Committee on Unopposed Bills because there are no Petitions in opposition to it. We have a further stage when it comes back to us on reconsideration.
7.31 p.m.
THE EARL OF LAUDERDALE: My Lords, far be it from me to intervene in the procedural wrangle which has just occurred across the Floor of the House. Where the broad ocean does lean against the land it might be said of harbours, as it has been said of sea voyages, that they have many advantages but security is not one of them. My only wish is to be a well-wisher to the new management of a major national asset. I think others would agree that we have lately been living in an atmosphere of Greek tragedy. I personally remember visiting the Port back in 1967, and again in 1968, and one saw then signs of trade decline, notably the fall of imports from Australia, East Africa and the Mediterranean, with signs of labour trouble building up to the point of some 200,000 days lost in a single year. We saw the Mersey Docks Board burdened with an enormous capital debt, with fixed assets put at a replacement value of more than £425 million but fast obsolescent, with a capital debt which soared from something like £80 million in 1968 to £93 million
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now; and we saw that swallowing up whatever operating surplus there might be, and then we saw that disappear.
Enough has been said in another place about the past, enough at any rate to confirm the Minister of Transport's point that au fond what the harbour needs is not subsidies but management. I should like to support what has been said by the noble Lord, Lord Nugent of Guildford, and I think echoed from the other side, that we should congratulate the Mersey Board in getting Mr. Cuckney as their Chairman meantime.
Two lessons stand out and this is the opportunity to draw attention to them. The first is that advanced provision must be made during the lifetime of the profit-earning period of major assets to take care of the big terminal losses which are bound to arise at the end of their relevant useful life; that is not an easy thing to make provision for in a time of inflation, let alone in a time of inflation like this.
But the second, and I think more general, point does to some extent arise out of and, if I may say so with the greatest respect, impinges on something that was touched on by the noble Lord, Lord Beswick. I come to the question of Government policy. No doubt the Government are doing good in secret and by stealth. Of course, we should hail the Government's decision to continue supporting the Seaforth project. I cannot imagine how they could have done otherwise since much of the investment was already committed. But I am not alone; I believe many people join me in saying that we still await the emergence of a clear, intelligible, constructive, viable ports policy.
We have seen the National Ports Council reconstructed. We have seen a banker put in charge. We have seen non-port operators admitted to the Board, and operators removed from it. We can see the logic of that. But what is the Government's broad policy towards the modernisation of our ports? Do the Government now recognise that ports provision is as vital a part of our economic infrastructure as are roads and other facets of the transport service?
I am one who welcomes the latest road improvements announced by Mr. Walker a week or two back to link up the ports of the opposite coasts; and that plan

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alone suggests that the Government are thinking in a constructive way on this subject. But have the Government yet got a policy—and are they willing to declare it—towards reclaiming land suited to industrial development near deep water for the ports of tomorrow? I am one, and there are others too, who eagerly await the Government's decision on a MIDA on the Thames.
But to return to the Mersey, there are surely plenty of reasons to believe that under Mr. Cuckney and his Deputy Chairman, Sir Matthew Stevenson, the revolution of rising expectations will indeed carry the Mersey in its stride. The Sea-forth Basin, more than 500 acres with a turning circle of 900 ft. or more, will be in use on present form by 1972. This should help. Indeed, it is the key to the whole thing. Already five deep sea shipping interests have declared that they plan to use it, mainly for the Atlantic trade in grain and meat and containers. That should help—and indeed, as it were in brackets, one hopes that some of the falling Australian trade can be recaptured. The new meat berths, with something like a quarter of a million cubic feet of quayside cold store, fed by no fewer than five mobile conveyors and able to fill no fewer than 52 refrigerated trucks, should help also. The new grain silos with a capacity of 85,000 tons, able to unload from grain ships at 2,000 tons an hour, should help. And then finally there is the fast improving hinterland development. The M.62 to Yorkshire is already almost through and it will go through to the Humber by 1976. There is a great opportunity there for further container traffic. That, too, should help.
Above all, there are more hopeful signs on the labour front, and Mr. Cuckney's own report, issued last month, stating that agreement has now been reached to recruit some 700 dockers, is in itself a good sign. But, as he summed up the situation, surely we can take his words, which are these:
"Provided we can keep our costs under control, provided we avoid the damage of self-inflicted wounds, provided we do not drive traffic away by serious and arbitrary interruptions of service, provided we obtain the reliefs sought in the present Bill, we could begin to turn the corner in 1971".
My Lords, the Mersey needs this Bill now. I simply say God-speed to help
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our fertile land win out against the desert of the sea.
7.39 p.m.
LORD NUGENT OF GUILDFORD: My Lords, may I say just a brief word in answer to the noble Lord, Lord Beswick, who asked me a specific point. May I also thank my noble friend who has made such a helpful speech about the Port of Liverpool and who has so much information and enthusiasm for our ports, and has spoken so encouragingly about the prospects for the new Seaforth installation. With regard to the point which the noble Lord, Lord Beswick, put to me so persuasively about the position for the future of the bond holders and the possibility of some floor being established for them, some guarantee given to them to limit the measure of their loss or their risk, I do indeed feel my withers wrung by the noble Lord's persuasiveness; but I have to say that in my judgment it would be a handicap to the new chairman and the new Board to ask them to take on any specific commitment here.
In principle, as I see this concern and as my noble friends and right honourable friends in Government see it, it is really a trading organisation and therefore it must stand on its own feet. In my belief it is fatal for Government to be ready to come in to help trading organisations, because when Government do so it is asking the rest of the community to provide extra money. Some firms have to be willing to stand on their own feet and make a profit if we as a nation are to survive. My belief, and our belief as a Government, is that the right policy is to ask everybody to bear his share. That means that this Board, despite its strange constitution and history, must be asked to bear its share the same as everyone else. But there is this consolation for this particular Board: that the Government are, partially by grant and mainly by loan, making this massive new investment of £40 million to modernise this port, because they realise how vitally important the Port of Liverpool is to us nationally and how important it is locally in an area which has high unemployment, so that it is not left to face the wind entirely unprotected. The port is being given substantial support, and there is a prospect that in the new set-up it will

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become better and viable in the future. It has better things to look forward to. So I hope that your Lordships will feel that we should give the Bill a Second Reading and wish it well in future.
On Question, Bill read 2a, and committed to the Committee on Unopposed Bills.
7.43 p.m.
LORD SANDFORD: My Lords, I beg to move that this House do now adjourn during pleasure until 8 o'clock.
Moved accordingly and, on Question, Motion agreed to.
House adjourned during pleasure.
House resumed.

INDUSTRIAL RELATIONS BILL
8.0 p.m.
Consideration on Report resumed.
LORD STOW HILL LORD STOW HILL moved Amendment No. 89A:
Page 141, line 46, at end insert—
"(4) Where a joint application for an approved closed shop agreement has been made to the Industrial Court under the provisions of paragraph 1 of the Schedule 1 to this Act, the Industrial Court may by such an interim order, on the application of any party to such joint application as aforesaid, make an order that any closed shop agreement which immediately before the coming into effect of Part II of this Act was in operation between any two or more parties to such agreement shall continue to be in operation between the parties thereto, and shall, so far as reasonably practicable, be deemed to have remained so in operation from the date of the coming into effect of Part II of this Act until the making of such interim order, subject to such changes, it any, in the terms of such agreement as may seem to the Industrial Court to be just and equitable, and shall continue to be so in operation for any period up to and until the making by the Industrial Court of its final order on such joint application.")
The noble Lord said: My Lords, I move this Amendment with some trepidation and without very much hope that the Government will feel able to accept it. This Amendment, and also Amendment No. 89B (if the House will allow me, in order to save time, to refer to that Amendment in the same speech) are designed to afford a new approach to the much vexed question of the closed shop. The approach is new in this sense. At the moment, we have reached the point in Schedule 3 at which the Court is empowered to make interim orders. The
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Court is enabled to make by way of an interim order any order which it could have made upon a final disposing of any matter which is brought before it. That power is given by paragraph 22, and the relevant words read that the Court is empowered
"to make, as an interim order, any order which under this Act the Court could make as a final order in the proceedings".
My Lords, I am not quite sure that those words are very clear. One does not know what state of information the Court is assumed to be acting upon, and therefore it is not altogether easy to answer the question, "What is the final order that the Court could make in those proceedings?" But I take it that what is meant is that the Court could make by way of an interim order any order which it could make as a final order upon the assumption that it had the necessary evidence and material upon which to make such a final order.
The approach in Amendment No. 89A is somewhat different. As I have previously submitted to the House, there is a kind of lacuna in the arrangements made and embodied in Clause 17 of the Bill with reference to approved closed shop agreements. When the Bill becomes an Act, the situation will be that up and down the country there will be a number of closed shop agreements which are, and have been in many cases for many years back, functioning perfectly satisfactorily. We have discussed previous Amendments designed to preserve those existing closed shop agreements, but without successfully persuading the Government to agree to any of them. What the first Amendment, Amendment No. 89A, purports to do is the following. It assumes that a perfectly normal joint application for a closed shop agreement has been made to the Industrial Court under the provisions of Clause 17 and Schedule 1 to the Bill. It assumes at the same time that there is in existence a closed shop agreement complete in form, with all its terms well tried in actual experience, operating to the satisfaction of everybody and producing a state of orderly relationships and orderly negotiations in the particular sector of industry to which that closed shop agreement relates.
The Amendment is based upon the view that it really is most unfortunate if the effect of the Bill is going to be that,

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in a situation in which both parties have asked for an approved closed shop agreement and there is already in existence a perfectly satisfactory closed shop agreement, that closed shop agreement must be brought inevitably to an end; that the parties are going to be put to the necessity, after a lapse of time, of trying to pick up the pieces, of trying to put the thing together again, and embodying them in an agreement which the Industrial Court ultimately sanctions. It would, so the argument runs, be infinitely simpler, and conduce so much to the interests of the parties to the joint application, if, while their application for an approved closed shop is under consideration and is passing through the various stages which, under Clause 17 and Schedule 1, it has to pass, the existing closed shop agreement could be maintained in operation. It is purely an interim arrangement.
It is not as if I am here asking the Government to agree that the existing closed shop agreement should be sanctioned and kept in being for good and all. Not a bit of it. It is simply, if this Amendment is accepted, given an interim period of life until the Court can make an order upon the application for an approved closed shop agreement. That is what this Amendment does. The relevant provisions are that the Court can order that any closed shop agreement which, immediately before Part II of the Bill comes into effect, was in operation, shall, so far as practicable, be deemed to have remained so in operation from the date of the coming into effect of Part II of the Bill until the making of such interim order, subject to any necessary change, and thereafter it shall continue to be in operation until the final order is available from the Court on the joint application. My Lords, that is what the first Amendment does.
If I may have the agreement of the House to discuss now the second Amendment, No. 89B, as I proposed to the House a short time ago, the approach is rather different. Again, it assumes the existence of a perfectly satisfactory closed shop agreement. It would enable either party to that agreement to ask the Industrial Court to order, again by way of a purely interim measure, in order to safeguard for a period of time the existing position, that the existing closed shop agreement should continue for a period
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not in excess of a year. If the parties wish, or either party wishes, to avail themselves of that procedure, the Court is enjoined, on receiving an application for that purpose, to send the matter straight away to the Commission, and the Commission then has to say whether there is in its opinion a prima facie case that the conditions set out in paragraph 5 of Schedule 1 to the Bill (which we have discussed almost ad nauseam) are satisfied, and the Commission must report its decision on that to the Court as soon as possible. If the Commission reports in the affirmative, the Court then, as I have said, by way of an interim order, can continue the existence of the existing closed shop for one year. At the end of the year, that interim order expires, but it can be kept in being by a further application for an interim order for another year.
In other words, the interim order does not necessarily come to an end at the end of the year. Its life can be prolonged by a further application. That is the scheme in the second Amendment. The first Amendment assumes a joint application. The second Amendment permits of a unilateral application, but if there is a unilateral application it cannot proceed without the sanction of the favourable advice of the Commission. The Court refers it in that case to the Commission, and cannot make the order unless the Commission reports favourably that the conditions in paragraph 5 of Schedule 1 are shown to be present.
Those are the two alternative schemes. They are purely of an interim nature, and designed to achieve the very limited objective of keeping in being for a short time while the parties can, as it were, rearrange themselves, an existing closed shop agreement which has functioned perfectly satisfactorily over a period of time. It is based upon the submissions that it really will be a disastrous pity if all these excellent closed shop agreements tumble to the ground as soon as the Act comes into force. That is the way to chaos, and these proposals are designed to obviate that. I formally move the first of those two Amendments.
LORD DRUMALBYN: My Lords, I am grateful to the noble Lord for taking these two Amendments together and explaining them so clearly. The noble Lord has been at immense pains to try

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to devise some kind of scheme which will be acceptable to the Government. This is a difficult task he has set himself, because of the complexity of the arrangements involved. I am bound to tell the noble Lord that he has not quite succeeded yet. I think that his main premise is not right. It is that there is bound to be a lacuna, bound to be a gap.
At an earlier stage I drew attention to the fact that the Bill would be brought in by stages, and I would have liked to be able to give more details of that at the present time. Unfortunately the scheme has not yet been put in its final form, but I can at any rate tell noble Lords this. It is a matter that we have been considering very carefully indeed with a view to ensuring that the sequence of bringing into operation the various parts of the Bill will be logical, and that the transition from present arrangements to those which will be necessary under the new legislation will be such as to give industry a reasonable opportunity to adapt its agreements. Perhaps I could just say this in general terms—I think I have mentioned it before—the first stage must obviously be registration. The Registrar as soon as may be has to set up a register and so on, and then the Court has to be set up and its rules have to be written.
Until that has happened there can be no question of bringing into effect Clause 5 of the Bill and all that goes with it, so that quite an appreciable time must elapse between the time when the Bill actually passes, Royal Assent is given, and the time when this part, the material part from the point of view of the kind of agreements we are discussing here, will begin to bite. That being so, I think that the noble Lord's worst fears should be misplaced. I cannot be more positive than that until the final scheme has been made, but it is our intention that this sort of lacuna he is referring to will not exist.
But, my Lords, apart from that, supposing there is a gap, this Amendment on the face of it is a very reasonable attempt to deal with the problem. It would only apply where a joint application had been made, as the noble Lord said. It would only apply where a closed shop had been in operation prior to the
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coming into effect of Part 2 of the Bill, and it would seem therefore not unreasonable to permit that closed shop agreement to continue to operate temporarily until the Court had had a chance to consider the application. I think this is the Alb-stance of the noble Lord's suggestion.
On looking closely at the Amendment, I am bound to say that it certainly does present aspects which are not very acceptable to us. To begin with, it is not solely applicable to the initial interim period during which by some mischance a gap might occur. It is applicable at any time after Part 2 has come into effect. If there was a closed shop agreement in operation immediately before that time—and the intention is, of course, as far as possible that those who are unlikely to pass the test of an approved closed shop will make arrangements in the intervening period for acceptable agency shop agreements—that closed shop agreement, under the Amendment, could be deemed to have remained in operation until the interim order is made; and from the making of the interim order the reactivated closed shop agreement will be fully and actually in effect until the Court makes its final order on the joint application.
I must draw attention first to the fact that the closed shop agreement which will be deemed to have remained in force is described as "any", and this will include, the face of it, to pre-entry closed shop agreement. If that is the intention it could not be accepted. I think it would be void to that extent under the Bill. I should also draw attention to the duration of this revised closed shop agreement. It will remain in effect—and the words say—
"until the making by the Industrial Court of its final order on such joint application".
In cases where the Court approved the closed shop agreement under Schedule 1 that is a definite date, but the Court is not required to make a final order if the report of the Commission does not recommend approval. All that happens under Schedule 1, paragraph 7, is that
"in that case the Industrial Court shall not proceed further."
Similarly in paragraph 15, if the C.I.R. recommends the application but on a

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ballot the proposals do not secure the necessary majority
"the Industrial Court shall not approve the proposals."
This means that in the event of an approved closed shop not being approved as a result of the application, the interim order, and so the closed shop, which had existed prior to the Bill coming into operation, possibly a pre-entry closed shop, could continue in force indefinitely. This would not be acceptable. I think that the noble Lord drafted his Amendment on the assumption that a final order of the Industrial Court would be necessary to reject the application for an approved closed shop agreement as well as to approve it. That is not so.
Finally, it seems to me, on a close examination of this Amendment, that its effect could be to legitimise retrospectively any closed shop operated during the period from the implementation of Part II of the Bill until an application under Clause 17 had been made, however long that period may be. Presumably, any complaint by an employee during that period could not be heard or remedied and if it had been heard or remedied, the remedy would be cancelled or nullified when the parties concerned made their application. That looks to me to be a very serious and quite unacceptable degree of retrospection. These results, I am sure the noble Lord will appreciate (although I do not think he intended them), would be completely at variance with those that we seek to achieve by the closed shop provisions. Therefore, I could not recommend the House to accept that Amendment and I am afraid that very much the same applies to the other Amendment which he moved.
It would have very much the same kind of effect. In paraphrase it says: An application for an interim order to be made to the Industrial Court by either party to a closed shop agreement in force immediately prior to the coming into effect of Part II of the Bill. Actually I think it says, "any one or more of the parties" may make application. To continue the paraphrase: Then the Court to refer the application to the C.I.R. and they to consider whether a prima facie case is established; that the criteria of paragraph 5 are fulfilled and then to
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report; then the Court to make an interim order if the C.I.R. reports that a prima facie case has been established; and then the interim order to provide that the closed shop agreement should continue in full force and effect; and the interim order to expire after one year unless an application be made by one of the parties to the agreement when the Court may extend it indefinitely.
There is not a great deal between these two Amendments. I am afraid that the objections apply to both and not least to the concept of the apparent intention to continue the pre-entry closed shop; and so I am afraid that I cannot recommend the House to accept either of these Amendments.
LORD STOW HILL: My Lords, I am grateful to the noble Lord for his sympathetic and careful answer. I am also grateful for the information he gave in a general form as to the Government's intentions as to the bringing into operation of the successive Parts of the Bill. While I quite understand that the plans are still under consideration and the noble Lord cannot commit himself yet precisely to those plans, I think I understood him to say that, in particular, Clause 5 would not be brought into operation until the Industrial Court and the Commission, to use a loose phrase, were in being. So before Clause 5 brings the closed shop agreement to an end, there would be brought into being a court and a commission to which resort could be held. I am grateful to the noble Lord for indicating by nodding his head that I have correctly understood the intentions of the Government so far as they are precisely formulated.
LORD DRUMALBYN: My Lords, I take a slight exception to the word "precisely". They are not yet precisely formulated; they are broadly formulated.
LORD STOW HILL: My Lords, I am sorry if I misunderstood the noble Lord. There is a general plan and the noble Lord goes as far as he is justified in going in the light of the state of that plan.
LORD DIAMOND: My Lords, I hope my noble friend will forgive me for interrupting. Does he not think that he owes the Government a deeper apology for having accused them of precision in anything in this Bill.
LORD STOW HILL: My Lords, I never use the word "accuse" in relation to the noble Lord, Lord Drumalbyn. I use kinder terms to him. I think he is universally helpful and does what he can.
My Lords, I do not wish to take the time of the House further over Amendment 89B which seems to me to suffer from a characteristic which would make it unlikely that the Government would be able to accept it; namely, that it can be made at the instigation of one or more of the parties; that it does not have to be a joint application. But my hopes are raised as to the Schedule 1 and Amendment 89A. I think that I correctly recollect what the noble Lord said when I list three observations in particular that he made as to which I should like to make suggestions. I think they can be easily remedied. The first was that I think I understood him to say that he thought the expression in the last two lines, "final order on such joint application" would not in its terms apply to an order of the Court deciding not to proceed. If that was what the noble Lord intended, then that can be remedied easily. I will try to find the right language to make it apparent that the closed shop agreement must come to an end if the Court declines to grant the application. That is fairly easily disposed of.
The second criticism he made was that the interim order is unlimited in time in terms of the Amendment; that it might continue for a considerable period of time. That again I think I could easily remedy by inserting in the text of the Amendment some provision to the effect that the interim order will expire in, say, a year or something like that. The third criticism he made was that the effect of the Amendment might be to prolong the life of a closed shop for a very long period of time because there is no period of time specified in the Amendment within which after the coming into operation of Part II of the Bill the application must be made. That again is a feature of the Amendment which can easily be remedied.
If the noble Lord felt able to indicate to me that if I inserted language into the Amendment which required the application to be made by both parties, say, within a period of six months after the coming into effect of Clause 5; if I
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further provided that the interim order if made would expire at the end of one year, or some such period; and if I further chose more suitable language to describe the order of the Court upon the hearing of the application so as to make it certain that the final order to which I referred would include an order refusing the application—if I remedied those three qualities in the Amendment to which the noble Lord feels he must take exception. I do not know whether he would be able to look with less disfavour on it when we get to Third Reading. He has been most helpful and, if I may say so, very encouraging. If he thinks that these changes would make the Amendment more acceptable from the point of view of the Government, then from this side of the House I think we should be able to say that the effect of the Amendment so changed would preserve for a limited period of time a large number of existing closed shop agreements and for a time sufficiently long (though not too long) to enable the parties to make up their minds what they wanted to happen and to make a joint application for an approved closed shop agreement if they wished the existing closed shop agreement to continue and to take the form of an approved closed shop agreement.
My Lords, there is one final feature. The noble Lord will have observed that when the application is decided it can be in terms that any particular provision of the closed shop agreement can be changed in any sense in which the Court thinks it could be changed. That appears in the fourth line from the end. May I conclude by thanking the noble Lord sincerely for what he said. I do not know whether he will be able to communicate with me and let me know whether changes along the lines I have suggested may conduce to a useful result. If he could indicate by a nod that he would write to me on these lines, I would be most grateful to him. In any event, I ask leave for the Amendment to be withdrawn.
Amendment, by leave, withdrawn.
8.30 p.m.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 89:
Page 141, line 46, at end insert—
(".In so far as the rules make provision for the purposes of section (Review of ballot

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taken under Part It or Part III) of this Act, they shall include provision—

(a) as to the circumstances in which, and the parties by whom, an application can be made to the Industrial Court for an order under that section;

(b) as to any circumstances in which the Industrial Court is to be empowered to make such an order without any such application; and

(c) as to the persons who are to be, or may be made, parties to any proceedings before the Industrial Court in which (whether in pursuance of an application or otherwise) the Court considers the making of such an order.")

The noble Lord said: This Amendment has to do with the review of ballots taken under Part II and Part III. It is linked with the new clause we shall come to after Clause 156. Before we get to that, there is an Amendment in the name of the noble and learned Lord, Lord Gardiner. I have been in communication with him and indicated that what we are now doing in Schedule 3 is bound to be influenced by our decision on his Amendment, in the sense that if this Amendment is accepted, we shall have to alter Schedule 3.
LORD GARDINER: My Lords, I am quite prepared to take whatever course is most convenient to the noble Lord. I suppose that strictly, if we are dealing with Schedule 3, we cannot come back to it, and if we were to change our minds on this point, what would the position be then?
LORD DRUMALBYN: My Lords, that is a very reasonable question but I think that the answer is obvious. There is another stage of the Bill and if the noble Lord's Amendment were successful, obviously we should have to alter the Schedule on Third Reading in order to come into line with the Amendment. I think that I ought to make it clear that I do not propose to recommend the acceptance of the noble and learned Lord's Amendment. The Amendment I am moving is to enable the Industrial Court to make recommendations as to the review of ballots either under Part II or Part III. On a number of occasions on the Committee stage the noble and learned Lord, Lord Gardiner pointed out that provisions in the Bill which required ballots to be conducted by the C.I.R. or under the supervision of the C.I.R. do not afford any opportunity for appeal
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against the reported result of the ballot, or give the Industrial Court any option other than to accept the result as reported, even though it may be evident that a mistake has been made in the conduct or reporting of the ballot. The noble and learned Lord urged that there should be some statutory procedure for rectifying mistakes made by the C.I.R. or by any other body conducting a ballot under the supervision of the C.I.R.
My noble and learned friend the Lord Chancellor accepted the noble and learned Lord's view that the prerogative writ procedures would not enable a simple error of fact—for example, in the counting of ballot papers—to be corrected by way of an order in the Divisional Court. He also accepted that it would be desirable to enable mistakes made in the conduct of statutory ballots to be challenged in the Industrial Court. I would direct your Lordships' attention to the fact that the proposed Government Amendments would apply only to ballots held under the provisions of Parts II and III—these are the agency shop and recognition provisions in general. It is not intended that the new provisions should apply in respect of strike ballots under Clause 142, and therefore there would be no provision for any party to complain to the Industrial Court of a mistake made in the conduct of a strike ballot, nor, as a result, could the Court order a fresh ballot.
The new clause will enable the Industrial Court to review the reports of the C.I.R. as to the result of a ballot and if necessary to take action in two ways. If the Court finds that a simple mistake has been made, which does not invalidate the ballot and should be rectified, it may make an order amending the report. A new ballot would not then be taken. The C.I.R.'s report would be amended in accordance with the order and have effect as amended. The other course of action, ordering a fresh ballot, would be appropriate where the Court finds that rectification of the report would not be just and equitable—where, indeed, the ballot has been so misconducted that the only just course would be to declare its result to be of no effect. In these circumstances the Court may make an order quashing the ballot, whereupon action would proceed as if the ballot had never been held. The Amendment to Schedule 3 would

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enable rules of court to be made to cover such details as the circumstances in which and the parties by whom an application for review of the C.I.R.'s report may be made, the circumstances in which the Industrial Court may be empowered to institute a review without an application being made and the persons who may be made parties to the proceedings.
The provision in paragraph (c) is necessary because when the Industrial Court acts on its own initiative, interested parties should be entitled to be heard and to submit either that there was no error or misconduct or that, even if there was, it did not necessitate quashing the ballot and holding another. There may be circumstances, too, where the Industrial Court proposes to amend the C.I.R.'s report and an interested party may wish to submit that the Amendment proposed by the Court is the incorrect one. Paragraph (c) of the Amendment would enable rules to be made to provide for all these circumstances. I feel that these Amendments provide an adequate procedure for the rectification of mistakes. I should like to express our gratitude to the noble and learned Lord, Lord Gardiner, for having drawn our attention to this matter, and I commend the new clause and the Amendment to the House. I beg to move.
LORD GARDINER: My Lords, I am grateful to the Government for the consideration that they have been kind enough to give to my suggestion. There was obviously a lacuna and it was apparent that a rule would be necessary. I have no comment to make on this Amendment. The other points which may arise we can discuss later.
LORD SLATER: My Lords, I should like to know who is going to be responsible for taking these ballots and who is going to make the appointments of people to take the ballots. Three people are responsible for the jurisdiction of the Industrial Court, but I want to know who is to be responsible for conducting the ballot and for counting the ballot papers to obtain the result of the ballot. In my own trade union, when a ballot is taken it is counted not by people in the union but by some outside authority. Will there be an outside authority responsible for counting the ballot papers in the case of this Bill?
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Where is the new clause in connection with this?
LORD DRUMALBYN: My Lords, may I refer the noble Lord to Amendment No. 94, the new clause after Clause 156. So far as the noble Lord's other questions are concerned, if he will look at Clauses 12 to 16 he will see that they deal with the ballot for an agency shop. In Part II, dealing with the proposals for recognition, he will see also provisions for the ballot there, and I think he will get all the information he requires. In principle of course the C.I.R. is to be responsible for the ballot.
LORD SLATER: My Lords, I am seeking to get an answer from the noble Lord in charge of the Bill.
LORD DRUMALBYN: I am trying to answer the noble Lord. I have just said that in principle the C.I.R. is responsible for holding the ballots, and in the circumstances laid down in the Bill it can pass on that responsibility to the trade union in question if it thinks fit. But it is for the C.I.R. to make arrangements for a ballot or for somebody to hold a ballot under its arrangements, and the C.I.R. then reports to the Industrial Court the results of the ballot.
LORD TAYLOR OF MANSFIELD: My Lords, this is a little vague, so far as it concerns the question put to the noble Lord by my noble friend. The noble Lord, Lord Drumalbyn, says that the C.I.R. will be responsible for holding the ballot. So far, so good. But who will count the votes when the ballot has been held by the C.I.R.? I am not arguing merits and demerits, but I am asking for the information that my noble friend desired. Will it be an independent body that will count the votes? As my noble friend said, in the union with which we have had experience, on all important matters, particularly ballots for strike, the counting of the votes is done by an outside independent body. Would the noble Lord give some guidance on that point?
LORD DRUMALBYN: My Lords, the circumstances vary, in so far as the agency shop and the recognition ballot is concerned. This is expressed to be taken by the Commission in the case of recognition, or is to be taken under the supervision of the Commission by some other

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body. In either case the Commission determine what arrangements will best secure that the ballot will be properly conducted and that the voting in the ballot will be kept secret. This responsibility is left in the Bill to the Commission, and I think the noble Lord will have sufficient confidence in the Commission to leave it to them.
On Question, Amendment agreed to.
8.43 p.m.
EARL FERRERS EARL FERRERS moved Amendment No. 89E:
Page 142, line 8, at end insert—
("Time-limit for complaints under ss. 101 and 102
.—(1) Subject to the following provisions of this paragraph, the Industrial Court shall not entertain any complaint under section 101 or section 102 of this Act unless it is presented before the end of the period of six months beginning with the earliest date on which the action to which the complaint relates came to the knowledge of the complainant, or would have come to his knowledge if he had exercised due diligence.
The rules may provide that, in relation to complaints fulfilling such conditions as the rules may specify, the preceding sub-paragraph shall have effect as if, for the reference to a period of six months, there were substituted a reference to such shorter period as is specified in the rules.
Notwithstanding anything in the preceding provisions of this paragraph, the Industrial Court may extend the time for presenting a complaint under section 101 or section 102 of this Act to such extent as the Court may consider appropriate to make allowance for any period during which the parties have availed themselves of the services of conciliation officers or of other opportunities for conciliation with respect to the matters to which the complaint relates.")
The noble Earl said: My Lords, on behalf of my noble friend Lord Drumalbyn, I beg to move Amendment No. 89E. During the Committee stage an Amendment was moved by the noble and learned Lord, Lord Donovan, which sought to impose a time limit of six months for bringing a complaint of unfair industrial practice to the Industrial Court or a tribunal. There was wide agreement then that a time limit for complaint was necessary. But, as my noble friend Lady Tweedsmuir explained at the time, complaints which may be presented to the Court will vary considerably in their nature and importance, and we believe it desirable to be able to set different time limits for different types of complaints,
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and the best way of achieving flexibility is through the Court's rules.
Some noble Lords did express misgivings about consigning the imposition of time limits to regulations which would be subject to the Negative Resolution procedure. The noble Lord, Lord Beaumont of Whitley, proposed a solution which we think, on reflection, meets this criticism, and we have been happy to adopt it in drafting this Amendment.
The effect of the Amendment will be to allow the rules of the Court to impose varying time limits for complaints of unfair industrial practice or breach of duty, within an overall time limit of six months. The Court will also be given discretion to extend the time for complaint where the parties have attempted to resolve their differences by conciliation. There is obviously room for argument on what the overall time limit for complaint should be. Imposing too short a time limit involves the risk of requiring the injured party to start proceedings prematurely where that may not be in the best interests of resolving the dispute peacefully. On the other hand, with the passage of time, memories of events fade and witnesses become increasingly difficult to assemble.
These facts, taken together with the point made by the noble Lord, Lord Janner, also in the Committee stage, that individuals should not have the risk of proceedings hanging over their heads interminably, made us feel that these are powerful arguments against allowing a very extended period for complaint. On balance, therefore, we believe that the period of six months is the right one. I think the Amendment contains the elements to direct Parliamentary control, to which noble Lords rightly attached importance in the Committee stage, and yet it has the necessary degree of flexibility which we consider to be desirable. I beg to move.
LORD STOW HILL: My Lords, I do not criticise the period of time chosen, but I wonder whether the noble Earl can give some indication of what the precedents are with regard to prescribing time limits for bringing proceedings by subordinate legislation. I know that at one time in our Parliamentary history, certainly during the 1945 Parliament, there would have been a storm of criticism if subordinate legislation had been used for

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that purpose; that is to say, for prescribing the substantive structure of claims—namely, a period within which they had to be brought. I believe that in the more recent legislation that very salutary principle, and I say this with perhaps a rather old-fashioned echo, has been substantially departed from. I should be grateful if the noble Earl, this being a matter of some constitutional importance, can give us any indication of what the more modern precedents are. I do not think there are older precedents, although there may be, and if he has them on his brief I should like to hear them; if he has not, I shall quite understand.
LORD GARDNER: My Lords, perhaps I can raise a short point. I not only do not object to, but welcome the way that in this Bill everything is done to remind lawyers that they must not take into account anything that they already know, and that an unfair industrial practice is a new angle; it is quite right that you should not call an injunction an injunction order, and it is quite right that you should not call damages damages for compensation. An unfair industrial practice is not, as I understand it, what lawyers call a cause of action; it is something quite new. But, of course, for limitation purposes one has to be very exact, as we are in relation to the date of the issue of the writ or service of the writ and so on, because actions are started either by writ or summons. It is right that this should be something quite different. It is called "entertaining a complaint".
Then there is the expression, "when the complaint is presented". Does that mean presented in court, or does it mean sending in some document? Perhaps the noble Earl can give us some idea of what "entertaining" means. Does this mean that the Industrial Court should not hear the case in court, or does it mean that they send you back the document and say "Go away"? There is no definition. These of course are the same expressions as are to be found in Clauses 101 and 102. But there is no definition anywhere of what exactly a complaint is, of what presenting a complaint consists, or what is meant by "entertaining". If when the noble Earl comes to reply he can give us some indication about this we should be grateful.
EARL FERRERS: My Lords, the noble Lord, Lord Stow Hill, asked what precedents there were for putting in this form of legislation. The figure of six months is written into the Bill. The subordinate part of the legislation to which I think he was referring was where the Court, by its rules, is empowered to shorten this period of time. The very quick answer that I am able to give to the noble and learned Lord—and I would have preferred a little more time so as to make quite certain that my answer is correct—is that I do not know of a particular precedent where this form of subordinate legislation, as the noble and learned Lord calls it, has been used before. On the other hand, he will of course realise that the purpose of this is to give a maximum period in the Bill and only where the Court believes that it is in the interests of all concerned that the period should be less will a shorter period be provided. I would reassure the noble and learned Lord that in fact any such rules as are made by the Industrial Relations Court will have to come before Parliament for approval, and therefore his fears over that may not be quite as substantial as they may have at first appeared because in the end Parliament will have to approve the rules.
With regard to the points made by the noble and learned Lord, Lord Gardiner, I am sorry but I am bound to say that I was slightly concerned to follow exactly the points he was making. If he will be kind enough to repeat them as briefly as possible, I will try to follow them more clearly.
LORD GARDINER: My Lords, there is a time limit, and therefore we must know necessarily when the time limit begins to run and when it ends. As lawyers know, when one is dealing with "limitations" one has to be very precise as to what one is talking about. Where in our law we have limitations they run from the date of the issue of the writ or of the summons, for example. You start an action either by issuing a writ or summons and then you have the pleading saying what your case is. Then you get a date from the court and have an oral hearing. As I said, I was not objecting that the language was different; but here there is nothing like a writ or summons and you are told to "present a complaint". Does that mean presentation by

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counsel before the Court or does it envisage a little document of some kind and, if so, is it enough to write on a piece of paper and say, "I am complaining about the following"?
No doubt rules will be made to deal with the detail, but I am wondering whether, as this is an entirely new form of legal procedure, the Government would tell us what they have in mind in talking about "presenting a complaint" and what it means. Ultimately, if it is a document somebody will have to decide whether you "present" a complaint when you post it or when it is received. I am not asking for details of that kind. I should like to know whether "entertaining a complaint" means that the Court would accept or decline to hear that party, or if it means that if they get a written complaint and it is out of time the Court itself will write back to you and say, "Go away".
LORD DRUMALBYN: My Lords, I do not know whether I can be of any more help to the noble and learned Lord but, as he himself has said, we are here dealing with an entirely new form of court and I should have thought that the natural thing would be to leave it to the Lord Chancellor to make the rules and that the rules would cover this sort of thing simply because it is a new form of court. I speak without special tuition on this subject, but that is the way in which I read it and I think he himself would read it in that way also.
LORD DIAMOND: My Lords, I will not detain your Lordships very long, but I should like to say, first of all, for the benefit of the Liberal Benches—
SEVERAL NOBLE LORDS: Hear, hear!
LORD DIAMOND: —and there is no noble Lord better at timing his entry than the noble Lord who has just come in—how grateful we all are that the Government should have accepted at all events the idea that has been put forward and enshrined it in the provisions which they are at present making. I think it right to say this, because the Government have been very helpful in our proceedings to-day in accepting many Amendments stemming from proposals to your Lordships' House from these Benches and from the Liberal Benches. Those of your Lordships who at any time might have
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felt that these proceedings were not of great fruitfulness will have been delighted to know that your fears were entirely baseless and that the purpose which your Lordships' House has carried out with diligence and discipline has been to a certain extent served. I think therefore it is up to me to say how grateful I am to the Government for the number of Amendments and ideas which they have accepted, including the one which is now before us.
I wonder whether, in not such a serious mood, I might try to help my noble and learned friend Lord Gardiner who asked, in relation to subsection (3), what "presenting a complaint" was. My noble and learned friend is very experienced in presenting a play, he being a well-known "angel". This is not quite that same field of art: a complaint is something rather similar to a chamber concert where the artistes present have no musical instruments but only their easels with them, and together they produce something for presentation which is called a "complaint". I hope that I have made the subject clear to my noble and learned friend; and I repeat my question to the Government.
LORD BEAUMONT OF WHITLEY: My Lords, I should like to apologise to your Lordships' House for not being here at the beginning of this debate. I hope that I shall be forgiven for rising to my feet, seeing that the Liberal Benches were mentioned as I entered. About this particular Amendment, I too would like to add my thoughts. I am not entirely certain that in fact the Amendment produced by the Government was based on what I meant to convey at the Committee stage.
LORD DIAMOND: The noble Lord said so.
LORD BEAUMONT OF WHITLEY: I am aware, my Lords, that the Government think it is based on what they thought I meant to convey at that time, but I was not then entirely certain that they had fully understood the point I was trying to put. Nevertheless, I think that the Amendment they have put forward is a good one and I should like to join in the remarks made by the noble Lord, Lord Diamond, about the way in which the Government have taken the Amendments that have been put forward

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at various stages, which were not designed in any way to wreck the Bill or change it enormously; and when they have been clear about that, they have been most helpful. I was able to quote a large number of instances yesterday during a Press conference when I was explaining exactly how far we hope to get with the Immigration Bill in your Lordships' House; and this was one of the examples which I quoted as to how far one can get. I believe this to be a good example of the way in which your Lordships' House has been able to amend the Bill, and we are very grateful for the extreme courtesy and consideration of the noble Lord in meeting the points. I should like to repeat my apologies to your Lordships' House for any seeming discourtesy in having arrived late.
On Question, Amendment agreed to.
9.0 p.m.
EARL FERRERS EARL FERRERS moved Amendment No. 89F:
Page 144, line 1, leave out from ("may") to end of line 5 and insert ("remove a member of the Commission on the ground of incapacity or misbehaviour").
The noble Earl said: My Lords, on behalf of my noble friend Lord Drumalbyn I beg to move this Amendment which in fact fulfils an undertaking to the noble Lord, Lord Stow Hill, at the Committee stage, to bring the wording of this paragraph into line with the similar provision in paragraph 6 relating to the removal of appointed members of the Industrial Court. We have already discussed this matter. I beg to move.
On Question, Amendment agreed to.
LORD STOW HILL LORD STOW HILL moved Amendment No. 89D:
Page 144, line 30, leave out from ("meetings") to the end of line 32.
The noble Lord said: My Lords, may I first use this opportunity for doing what I should have liked to do on the last Amendment, which is to express my very sincere thanks to the Government Front Bench for having moved the last Amendment and to the noble Lord, Lord Drumalbyn, in particular for implementing his promise.
Amendment 89D deals with a slightly different subject, although it is connected
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with the last Amendment. We discussed at the Committee stage the importance of making certain that the Commission on Industrial Relations was seen to be a body independent, able to take an objective view as between the opposing sides of the table and not unduly subject to the control of the Executive. We had a discussion as to its constitutional position, and as a result of that discussion the noble Lord, Lord Drumalbyn, undertook to make the change which he made in the last Amendment which your Lordships approved.
The Amendment which I am at present seeking to move is designed to promote the objective of making sure that the Commission is universally recognised as being independent. It is designed to conduce to that objective in the following way: in Clause 34 your Lordships will see provisions as to the conduct by the Commission of its affairs, and the words which I seek to leave out in Clause 34 are
"but in doing so shall act in accordance with any general directions which may from time to time be given to them by the Secretary of State."
The submission which I make to the House is that that is an unnecessary subjection of the Commission to the Executive. I do not quite see what useful purpose is to be served by giving the Secretary of State the power to give general directions to the Commission as to how it runs its affairs. That is what it comes to. The effect of the presence of that power must be, one would submit, that perhaps not greatly but to some extent it may tend to undermine the authority and standing as an independent body of the Commission.
This is a short point. As I say, it follows very much on the previous Amendment and I beg to move it for the reasons I have given. One reason is that we should support in every way the authority and independence of the Commission, and when it is made subject to the Secretary of State's general power of giving directions that, so far as it goes at any rate, will tend to undermine the position of the Commission. I beg to move.
THE EARL OF BALFOUR: My Lords, here is it not most important for the

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Secretary of State to have power to decide what shall form a quorum? This I find is very difficult in lots of things one may come across. Even with all sorts of trust deeds and things like that there is sometimes great complication in deciding what shall form a quorum or how many people shall sit. We do not yet know how much the Commission will be involved. This gives the Secretary of State possible powers to appoint an extra few people if needed. I think this is more surely the meaning, than for the Secretary of State to have powers to ask the Commission to alter any deliberations they have or prevent them from carrying on their own procedure. This clause appears to me to deal more with the matter of a quorum.
LORD DRUMALBYN: I am grateful to the noble Lord, Lord Stow Hill, for introducing the Amendment in the way he did. I am grateful to my noble friend. I did suggest at an earlier stage that because the quorum of the Commission might vary this might be one of the occasions when a general direction should be given. I merely instanced that as a possible case, quite off the cuff; but I should like to emphasise very strongly that we do share the noble Lord's wish that the Commission should be, and should he seen to be, independent and completely free of Government control. But we are here talking of the proceedings of the Commission only, and the provision for direction by the Secretary of State is qualified very much by the word "general"—a word we are very familiar with now in the nationalised industries in "general directions"—and does not relate to day-to-day conduct of their business in any way at all. It certainly would not be aimed at any particular case or person. The Secretary of State could not, even if he wished, direct the Commission as to the conclusions they should draw and the recommendations they should make in a particular case. This could not possibly he done. There is no obligation on the Secretary of State to give directions, and the Government regard this provision merely as a necessary precaution against the possibility of a procedural deadlock which the Commission is unable to resolve by itself. I hope that the noble Lords opposite can accept that it is not in any way incompatible with the independence of the Commission, which the Government are as anxious to ensure as they are.
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This kind of reserve power is one which all Governments have retained over bodies that they set up, and I do not think that this one should be any exception.
9.8 p.m.
LORD STOW HILL: My Lords, I am grateful to the noble Lord for what he has said. If the power is so hedged around as he has described it, is it really worth while preserving at all? I listened closely to ascertain what he had in mind and he said that really the general power was designed to deal with what I think he described as a "procedural deadlock". I just do not know what that means. Does it mean that if they start hitting each other across the table the Secretary of State will say, "Do not hit each other"? It is such an unlikely thing to happen, and I submit that this power produces a bad impression.
The power clearly could not be used for the purposes of regulating their day-to-day proceedings, and the situation when it could be brought into effect is likely to arise on such rare occasions among sensible, intelligent people; and one assumes that such people will be appointed. Is it really worth while retaining? I should be glad if the noble Lord would give further thought to this at a later stage. It seems a pity to have this power included in the Bill when it will create a bad impression and will serve no useful purpose.
LORD DIAMOND: My Lords, the noble Lord—or at least those of my noble friends who come from the North—will recollect that in the earlier days of this century there was a most important official known as a "knocker-up". But the important question was who knocked up the knocker-up, and one is familiar with the song about the knocker-up's knocker-up. Your Lordships may think this a facetious remark. Not at all. It is an attempt to show how ridiculous is the refusal of the noble Lord to accept this Amendment. Here is the Commission, which is to advise some of the largest companies and the largest unions in this country as to how to regulate their proceedings. That is what the Commission is about, and it is intended that the Commission shall be peopled with individuals of great distinction who will be able, by their authority, their experience and their ability to demonstrate to those who come to seek

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advice from them, that if one really wants to know how a procedure should be worked out and carried out all one has to do is to consult the Commission. Yet here is a proposal which rests on the assumption that the Commission is not capable of working out its own procedure.
LORD BERNSTEIN: My Lords, it is not trusted.
LORD DIAMOND: My Lords, as my noble friend has said, it is not trusted. It is such a slur on their ability and such a denial of all the hopes that the Government are pinning on the Commission, that I should have thought the Government would be the last people to refuse this Amendment. I really do beg the Government to think again. It is quite absurd to suggest that of all bodies the Commission, the final resting place of all decisions as to what is proper and right in procedure-making, should have their own procedures fixed by the Secretary of State and, when they are unable to agree on such simple matters as the quorum necessary for their meetings, should have to be assisted by the Secretary of State.
Of course we accept that all Secretaries of State have endless wisdom, but sometimes they have not time to give careful thought to whether the quorum necessary for a meeting of a particular body should be two or three, or four or five. Sometimes they have other things to do. I should have thought that the Government would be impressed by the arguments put forward by my noble friend Lord Stow Hill, who has made a most magnificent contribution to our debates to-day and has shown his ability to help the Government with their Bill. I should have thought they would be impressed by his arguments and would wish to reconsider now what they have just said. I am afraid we would not be prepared to allow the Government to continue with
the kind of nonsense that is in the Bill at the moment unless they are prepared to say something helpful.
LORD DRUMALBYN: My Lords, I do not know whether the noble Lord will find it helpful, but perhaps he will allow me just to say this: when the Party opposite set up the Prices and Incomes Board under the Prices and Incomes Act they incorporated an almost exactly similar provision. In fact, so far as can be traced it has not been used, but nevertheless it was there and one can never exactly foresee the future. There are occasions when independent bodies like to be told what to do.
This is a very narrow point and I am afraid I could not concede. There is a precedent and I think there is a reasonable case for it. I certainly do not think it would be worth pressing to a Division in view of the precedent.
LORD BEAUMONT OF WHITLEY: My Lords, since it is the Minister who has just spoken, I imagine I am in order in speaking for the first time on this Amendment. I entirely agree with the noble Lord, Lord Diamond and the noble Lord, Lord Stow Hill. This is a total nonsense; it will never be used. But, honestly, I would not have thought this Amendment was worth dividing on. It may be that the noble Lord, Lord Diamond, will want to divide. The point is that this will never be used; it is one of those nonsenses which Governments of every kind, as the noble Lord, Lord Drumalbyn, almost went so far as to say, incorporate in every Bill. It is not a danger to the liberty of the subject or the liberty of the Commission. I would not have thought it was worth our while trooping through the Lobbies.
9.15 p.m.
On Question, Whether the said Amendment (No. 89D) shall be agreed to?
Their Lordships divided: Contents, 25; Not-Contents, 72.

CONTENTS

Addison, V.

Delacourt-Smith, L.

Hughes, L.

Bernstein, L.

Diamond, L.

Longford, E.

Beswick, L.

Gardiner, L.

Popplewell, L.

Brockway, L.

Garnsworthy, L. [Teller.]

Ritchie-Calder, L.

Buckinghamshire, E.

Heycock, L.

Rusholme, L.

Champion, L.

Hoy, L.

Shackleton, L.

Slater, L.

Strabolgi, L. [Teller.]

White, Bs.

Stonham, L.

Taylor of Mansfield, L.

Wootton of Abinger, Bs.

Stow Hill, L.

NOT-CONTENTS

Ailwyn, L.

Exeter, M.

Molson, L.

Albemarle, E.

Falkland, V.

Mowbray and Stourton, L.

Auckland, L.

Ferrers, E.

Napier and Ettrick, L.

Balerno, L.

Ferrier, L.

Nugent of Guildford, L.

Balfour, E.

Fortescue, E.

Oakshott, L.

Barnby, L.

Glendevon, L.

O'Neill of the Maine, L.

Belhaven and Stenton, L.

Goschen, V. [Teller.]

Rochdale, V.

Belstead, L.

Gray, L.

Ruthven of Freeland, Ly

Berkeley, Bs.

Greenway, L.

St. Aldwyn, E.

Boston, L.

Grenfell, L.

St. Helens, L.

Bridgeman, V.

Gridley, L.

St. Oswald, L.

Brooke of Cumnor, L.

Grimston of Westbury, L.

Selkirk, E.

Brooke of Ystradfellte, Bs.

Hatherton, L.

Selsdon, L.

Brougham and Vaux, L.

Inglewood, L.

Sempill, Ly.

Burton, L.

Jellicoe, E. (L. Privy Seal.)

Sinclair of Cleeve, L.

Colville of Culross, V.

Kemsley, V.

Somers, L.

Craigavon, V.

Kilmany, L.

Stonehaven, V.

Crathorne, L.

Kilmarnock, L.

Strange, L.

Cromartie, E.

Lauderdale, E.

Strathclyde, L.

Davidson, V.

Macleod of Borve, Bs.

Terrington, L.

Denham, L. [Teller.]

Macpherson of Drumochter, L.

Vivian, L.

Drumalbyn, L.

Margadale, L.

Wakefield of Kendal, L.

Dundee, E.

Merrivale, L.

Wigram, L.

Elliot of Harwood, Bs.

Mersey, V.

Wrottesley, L.

On Question, Amendment agreed to.

9.23 p.m.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 90:
Page 145, line 24, at end insert—
("(3) In making arrangements for any such ballot, the Commission may invite any person who is the employer of any workers eligible to vote in the ballot to provide premises and other facilities for enabling the ballot to be taken in accordance with the arrangements.")
The noble Lord said: My Lords, this is an Amendment standing in the names of my noble friend Lord Thorneycroft and myself. It is an Amendment of the utmost clarity. I do not think I need to explain it in any way at all. It gives effect to what has been already agreed. We should have had to put it in four times as it was originally incorporated. We do it here once, and I think it serves its purposes admirably. I beg to move.
LORD DIAMOND: My Lords, there is no need to delay your Lordships on this Amendment, which has been moved so persuasively by the noble Lord, Lord Drumalbyn, with the powerful support of his noble friend Lord Thorneycroft. It is a very acceptable Amendment to us.
LORD SLATER: My Lords, I should just like to say to my noble friend and
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noble Lords that I am not surprised at this Amendment, or at the Government's giving way and putting down this type of Amendment. After all, it is the industrialists, the big companies in this country, who are behind this Bill along with the Government, while the trade unions take a different attitude to it. They do not want it. It does not belong to them, it belongs to the industrialists, and we have the Government coming along and supporting the industrialists' request. They are the employers of labour, and they are the people who are going to provide the facilities for carrying out the ballots that have to take place on their premises. It could be that anything up to 2,000 people will be involved in a ballot. Therefore, I am not surprised that this Amendment, which has been accepted by my noble friend Lord Diamond, has been put forward for our approval.
LORD DRUMALBYN: My Lords, that sounds to me like a rather critical speech. I should have thought it was a very reasonable proposition that the Commission, if it chooses, may invite anyone who is an employer of workers to provide premises and other facilities for enabling a ballot to be taken on his premises to which the workers are accustomed to go. There is no obligation on the employer to accede if he does not want to. This

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provision is put down only as a convenient and, I should have thought, sensible way of carrying out a ballot. If the Commission does not think it either convenient or sensible, then it will not invite the employer to do it. Here, again, this is a matter which we can leave to the good sense of the Commission.
LORD SLATER: My Lords, if the employer is not prepared to allow the use of his premises for a ballot, will the Commission get to know the names of all the employees and correspond with every one of them? It is no use the Liberal Peers turning round on Labour Peers. We have had too much experience in the labour field—
SEVERAL NOBLE LORDS: Order!
LORD TAYLOR OF MANSFIELD: My Lords, what happens if the employer does not accede to the request of the Commission? I remember that a long time ago there were two rival unions in the Nottinghamshire coalfield and we had to have a ballot. The T.U.C. were anxious to ascertain the wishes of the men, and to find out which union they desired they undertook to have a ballot, to provide the money and to provide a reputable firm of solicitors in Nottingham to supervise the ballot and count the votes. But the colliery owners would not allow the ballot to be taken on their premises, so, strange to relate, it had to be taken on the public highway. If any of those taking part had put one foot on the colliery premises they might have been prosecuted. I do not say that what happened some years ago in Nottinghamshire would happen again, but it is quite possible that an employer may not accede to the request of the Commission to take a ballot on his premises. In that event, what would be alternative?
9.30 p.m.
LORD DRUMALBYN: My Lords, may I reply to the noble Lord, with the consent of the House? We have confidence that the Commission will be a responsible body and if this expedient fails they will find another. The responsibility is theirs.
LORD TAYLOR OF MANSFIELD: My Lords, I do not want to speak again—
SEVERAL NOBLE LORDS: Order!
LORD TAYLOR OF MANSFIELD: —but I would like to say that that is a very, very vague answer.
LORD SLATER: They do not let you speak, they order you down.
Schedule 6 [Provisions relating to Industrial Tribunals]:
EARL FERRERS EARL FERRERS moved Amendment No. 90B:
Page 162, line 17, leave out ("(e) of section 155(1)" and insert ("(f) of subsection (1) of section 155 ").
The noble Earl said: My Lords, this Amendment together with the next Amendment, No. 90C, are, like Amendments Nos. 88H and 88J which we have already discussed, contingent on the acceptance by the House of Amendment No. 93J which comes later. This Amendment seeks to add to the categories of information protected from disclosure by Clause 155, information obtained by an employer for the purpose of legal proceedings. The Amendment which we took earlier enabled the Industrial Court to sit in private when such information is given in evidence. These Amendments make similar provision in respect of industrial tribunals, in order that they too may hear legally privileged information in private. Although the House has not yet fully debated Amendment 96J, I hope that, with this brief explanation, your Lordships will agree to this Amendment.
EARL FERRERS: My Lords, I beg to move Amendment No. 90C.
Amendment moved—
Page 162, line 20, leave out ("the said paragraph (e)") and insert ("paragraph (e) of that subsection").—(Earl Ferrers.)
LORD BELSTEAD LORD BELSTEAD moved Amendment No. 90D:
Page 162, line 38, leave out from ("Act") to second ("the").
The noble Lord said: My Lords, I beg to move this Amendment, and would ask if we might discuss with it Amendments Nos. 90J and 90E. These three Amendments are necessary for technical reasons and it would be helpful if they could be

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taken together. They do not introduce a new principle, but they are important. Schedule 6 deals with matters which are to be covered by regulations governing proceedings before industrial tribunals, and paragraph 5 deals in particular with complaints under Clause 106. Complaints under that clause may relate either to unfair dismissal or to unfair industrial practices under Clause 5, and in both cases, of course, the employer is concerned.
As originally drafted this paragraph 5 was restricted in its application to complaints of unfair dismissal, and therefore when providing for a time limit for the presentation of such complaints it laid down a period of four weeks beginning with the effective date of termination. However, my Lords, complaints under Clause 5 may be about acts of discrimination, which could be over a period of time. The wording of this paragraph must therefore take account of this difference in the types of complaint covered by Clause 106, and this Amendment, No. 90J effects that. These Amendments will remedy the deficiencies of the original draft by providing that the period permitted for presenting complaints will be four weeks from the effective date of termination when the complaint relates to a dismissal, and in other cases four weeks from the date of the action complained of or, where the action is repeated, from the latest date on which it occurred.
May I draw the attention of your Lordships to the third Amendment, No. 90E, which is connected with Amendments which were moved by my noble friend Lord Jellicoe to Clause 32? At that time he apologised because this Amendment No. 90E was not tabled, although he spoke to the general principle of the matter. Regulations made under this paragraph 5 of Schedule 6 will be subject to any order revoking the exemption of a voluntary dismissal procedure made by the Industrial Court under Clause 32, which directs that employees dismissed during a period immediately prior to the date of such an order shall have an extended time in which to make a complaint of unfair dismissal through the statutory machinery. I hope you will take the view that this safeguards the rights of appeal of employees who are dismissed during a period in which there has been a break
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down of the exempted voluntary procedure. I beg to move.
LORD BELSTEAD: My Lords, I beg to move Amendment No. 90J, which is a consequential Amendment.
Amendment moved—
Page 162, line 41, leave out ("with the effective date of termination") and insert—
("(a) in the case of a complaint relating to dismissal, with the effective date of termination, or
(b) in any other case, with the date of the action specified in the complaint (or, if that action occurred on two or more dates, the latest of those dates)").—(Lord Belstead.)
LORD BELSTEAD: My Lords, I beg to move Amendment No. 90E, which is a consequential Amendment.
Page 162, line 42, leave out from ("termination") to end of line 43 and insert ("unless the tribunal is satisfied that in the circumstances it was not practicable for the complaint to be presented before the end of that period.
(2) Any provision made by regulations in pursuance of the preceding sub-paragraph shall have effect subject to any order of the Industrial Court under section 32 of this Act.").—(Lord Belstead.)
LORD STOW HILL: My Lords, I do not quite follow how the second paragraph of this Amendment operates. Supposing a procedure agreement is revoked under what will be Section 32 of the Act, and employees have been dismissed shortly before the order revoking it, they are to have an extended time in which to prefer a complaint. I do not see how that is achieved by language which says:
"(2) Any provision made by regulations in pursuance of the preceding sub-paragraph shall have effect subject to any order of the Industrial Court under section 32 of this Act."
What is the form of the order which is envisaged which might automatically have an effect on the regulations? Could the noble Lord give me an example? I cannot envisage how that is supposed to work.
LORD BELSTEAD: My Lords, I am afraid that I cannot give an off-the-cuff answer. I thought the noble Lord was going to ask me about the real effect of the word "subject" which, so far as I know, means waiting for an order. The order was debated by the House when Clause 32 was debated. I am sorry that

315
I cannot give the noble Lord a more satisfactory answer.
LORD DRUMALBYN: My Lords, may I draw the noble Lord's attention to Clause 32(3)(b) which has something to do with this.
LORD BELSTEAD LORD BELSTEAD moved Amendment No. 90F:
Page 162, line 43, at end insert—
(".In relation to proceedings on corn-plaints under section 107 of this Act, the regulations shall include provision precluding an industrial tribunal from entertaining such a complaint unless it is presented before the end of the period of four weeks beginning with whichever is the West of the following dates, that is to say—

(a) the date of the action specified in the complaint (or, if that action occurred on two or more dates, the latest of those dates);

(b) the earliest date on which that action came to the knowledge of the complainant;

(c) where the complaint relates to a matter in respect of which an application has been made under section 81 of this Act, the date on which the registrar gave notice of his conclusions on investigating that matter or gave notice that he had determined not to proceed with the application.")

The noble Lord said: My Lords, this Amendment also imposes a time limit for the presentation of complaints to an industrial tribunal, but this is about unfair industrial practices under Clauses 66 and 70, which are the guiding principles, and about breaches of the rules of organisations of workers and employers. It extends a principle that I have submitted to your Lordships and with which your Lordships have agreed. I have moved this Amendment as briefly as possible. I beg to move.
9.38 p.m.
LORD BELSTEAD LORD BELSTEAD moved Amendment No. 90H:
Page 162, line 45, at end insert—
(".Where in accordance with the regulations an industrial tribunal determines in the same proceedings—

(a) a question referred to it under Part I of the Redundancy Payments Act 1965, and

(b) a complaint presented under section 106 of this Act,

section 9(2)(b) of that Act (whereby a dismissal is to be presumed, unless the contrary is proved, to have been by reason of redundancy) shall not have effect for the purposes of the
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proceedings in so far as they relate to the complaint under section 106 of this Act.")
The noble Lord said: My Lords, this is a small, technical Amendment. There will no doubt be occasions when an employee, who is uncertain about the reason for his dismissal, will make a claim to a tribunal for a redundancy payment under the Redundancy Payments Act 1965 and, at the same time, a complaint of unfair dismissal under Clause 106 of this Bill. This is what, so far as we know, is open to any employee to do if he or she wishes. It is envisaged that the tribunal regulations will enable a tribunal to deal with two such claims concurrently in the same proceedings. Section 9(2)(b) of the Redundancy Payments Act provides that where a claim under that Act is referred for determination by a tribunal, for the purposes of that reference
"an employee who has been dismissed by his employer shall, unless the contrary be proved, be presumed to have been so dismissed by reason of redundancy."
Your Lordships may agree that in concurrent proceedings of the kind I have described, where an employee is bringing a complaint either under the Redundancy Payments Act or under Clause 106 of this Bill, this presumption of redundancy as the reason for dismissal really should apply only to the claim under the Redundancy Payments Act and should not apply to the complaint under Clause 106 in relation to unfair dismissal. Indeed, it strikes me that it would be extremely unfair to the employee if this were so. It is for this sole purpose that I move this Amendment. I beg to move.
Clause 128 [No compulsion to work or to take part in industrial action]:
9.41 p.m.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 90A:
Page 95, line 44, at end insert—
("( ) Any power conferred on a court by the Employers and Workmen Act 1875—

(a) to accept security for the performance of a person's contract, or

(b) having accepted such security, to order performance of the contract accordingly, shall cease to be exercisable.")

The noble Lord said: My Lords, I beg to move Amendment No. 90A. The purpose of this Amendment, together

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with the related Amendment to Schedule 9, repealing certain sections of the 1875 Employers and Workmen Act, is to remove any inconsistency in that Act with Clause 128 of the Bill which prohibits any court from making an order for specific performance of a contract so as to compel an employee to do any work. Clause 128 prevents any court from compelling an employee to do any work by an order for specific performance of a contract of employment. However, although, as I mentioned in Committee stage, that part of Section 6 of the 1875 Act which gives a court a mandatory power to order a specific performance of a contract was repealed by Section 1 I of the Family Law Reform Act in 1964, the power of a magistrates' or a county court to order performance of a contract with the consent of the parties and in the giving of security is still retained in Sections 3, 7 and 8 of that Act.
While it is true, as the noble and learned Lords, Lord Gardiner and Lord Donovan, have pointed out, that these provisions and others in the Act are rarely, if ever, invoked, we feel—and I think your Lordships will agree—that continued retention of these provisions in the Act would appear to conflict with the mandatory prohibition in Clause 128(1) against performance of a contract. The Amendment therefore sets out the principle that the powers of a magistrates' court or a county court under the 1875 Act to accept security and order performance of a contract are to cease to be exercisable. This supplements the enactment in Clause 128(1) of the equity principle that no court shall order specific performance of a contract. We think it desirable that this principle should be set out in the body of the Bill in addition to repealing these sections of the 1875 Act in Schedule 9.
Your Lordships will note that the Amendment refers to "persons" rather than to "employees". This is because the 1875 Act deals with disputes between employers and workmen, and the definition of "workman" in that Act is confined substantially to manual workers. Other types of employees would not therefore be affected by this provision. This Amendment is related purely to the proposals we intend to make to repeal the provisions I have mentioned in the 1875 Act. When we discuss Amendment
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No. 98B we can deal more fully with the reasons for retaining for the time being other provisions in that Act. My Lords, I beg to move.
9.45 p.m.
LORD GARDINER: My Lords, I hope the noble Lord, Lord Drumalbyn, may be prepared to withdraw this Amendment. I suppose that any Government which introduces an enormous Bill of this character must include in it some nonsense, but this is an enormous piece of drafting of double or treble nonsense. The Government are providing for the repeal of all the provisions by which a Court can order such security to be given. What is the point of saying that the powers of the Court shall cease to be exercisable when we are removing in the same Bill the only powers which such a Court has? On that view this Amendment is clearly unnecessary. But indeed the whole Act is a nonsense. It is a survival of employer-employee relations in the last century. In substance, what the Act does, or did, was partly to deal with apprentices. Apprentices could be ordered back to work, and the control over apprentices provided that in a dispute between an employer and employee, if for example half a dozen unofficial strikers went on strike they could be taken to the local police court and ordered to pay up to £10 every day the strike continued, or if you wanted it to be £50 a day you could go to the county court.
I have not traced any case, certainly in the last 65 years, in which the Act has ever been used. The noble and learned Lord, Lord Donovan, with all his experience as Chairman of the Royal Commission, said that he knew of no case, I think in living memory, in which the Act had ever been used. Here is what is supposed to be a very bright and comprehensive piece of legislation on industrial relations, and quite rightly it repeals the Trade Union Act 1871, the Trade Disputes Act 1966, and the Trade Disputes Act 1965. What is the point of keeping this Act on the Statute Book? Your Lordships may remember the noble and learned Lord, Lord Donovan, saying that he knew of only one possible useful purpose in keeping it on the Statute Book: that was, that in legal circles it was regarded as a well known trap question for Bar candidates. This rather melancholy

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legislative history is set out in the chronological table as follows: Section 2 repealed by the Statute Law Repeal Act (No. 2), 1893; Section 6 repealed in part by the Family Law Reform Act, 1869; Section 8 repealed in part by the Statute Law Repeal Act (No. 2), 1893 and amended by the Justices of the Peace Act, 1949; Section 9 repealed in part by the Statute Law Repeal Act (No. 2) 1893 and amended by the Justices of the Peace Act, 1949 and the Administration of Justice Act, 1956; Section 10 repealed in part by the Statute Law Repeal Act, 1893; Section 11 amended by the Factory and Workshop Act, 1.878; Section 13 repealed in part by the Merchant Seamen Act, 1880; and Section 15 repealed in part by the Statute Law Repeal Act, 1893. There is very little left of the thing now. There is Section 1 left. Section 1 says:
"This Act may be cited as the Employers and Workmen Act 1875."
What are we doing with this nonsense? Why could we not get rid of the whole thing? Certainly it is not necessary. The Amendment says that any power conferred on the Court by the Act shall cease to be exercisable. It goes on in the repeal Schedule to repeal in the Act the only provisions conferring such powers. If we are to do away with it anyhow why do we suddenly say so? I hope the noble Lord will withdraw the Amendment so that we can consider when we deal with the repeal Schedule what the noble and learned Lord, Lord Donovan, and I have suggested.
9.49 p.m.
LORD DRUMALBYN: My Lords, whatever we do we certainly would not withdraw this Amendment because to do so would conflict with the whole tenor of the Act. As I said at an earlier stage, the only things we could repeal in this Bill are matters relating to this Bill. I am advised that it is not considered generally proper in legislation to repeal things not related to that legislation. There is a provision which still relates to the Truck Acts for example and the Truck Acts, I am advised, still operate. That provision is still in this Bill and I am advised it would be not right to repeal the whole Act in this Bill. Between now and Thursday, when we expect to come to the noble Lord's Amendment on Schedule 9 and to
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our own, we shall certainly have a look at this to see to what extent the noble Lord and ourselves are in agreement, but I invite the House to approve this, which most certainly is right in the circumstances.
Clause 129 [Collective agreements]:
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 90G:
Page 96, line 5, at beginning insert (" Subject to the next following subsection ")
The noble Lord said: My Lords, this is a paving Amendment for Amendment No. 91E. The effect of 91E is to remove from Clause 129 an unintended restriction, because as drafted it precludes the Court of Appeal from hearing cases on appeal from the National Industrial Relations Court and the House of Lords from hearing such cases on further appeal should one somehow reach it. My Lords, this was not intended, of course. These appeals will be on points of law; and I would invite noble Lords to approve these two Amendments.
LORD DIAMOND: My Lords, before the noble Lord sits down, may I ask him whether he was going to invite us to consider these two at the same time?
LORD DRUMALBYN: My Lords, I was inviting noble Lords to consider Amendments Nos. 90G and 91E together. I said that 90G was a paving Amendment, and then I explained 91E. I beg to move No. 90G.
9.53 p.m.
LORD STOW HILL LORD STOW HILL moved Amendment No. 91A:
Page 96, line 5, at beginning insert—
(" No action for damages for breach of a collective agreement shall be entertained in any court, and ").
The noble Lord said: My Lords, I beg to move this Amendment, which is simply designed to introduce some clarity into a clause which at the moment, I think, is extremely obscure. It is a matter of some importance. Clause 34, as your Lordships know, makes collective agreements enforceable in some circumstances. Clause 36 deals with the question of a breach of a collective agreement. When one reads those two clauses

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it is awfully difficult to determine from them whether any action lies in the ordinary courts to claim damages for breach of a collective agreement. Certainly you can in the Industrial Court claim compensation upon the basis of an unfair industrial practice if you break a collective agreement. That is provided for in Clause 36. But I studied the Bill very closely to try to discover anywhere in the Bill some language which clearly states what I believe is the Government's intention, that no claim for damages for breach of a collective agreement can he brought in any court.
What I seek to do by the Amendment which I am now moving is to state that specifically and clearly. What I would venture to put into the beginning of Clause 129 are words which I think are perfectly clear and easy to understand:
"No action for damages for breach of a collective agreement shall be entertained in any court…"
I think I am right in saying that that is the Government's intention. We were told that when we discussed this point on Committee. I think it might be stated in terms so as to remove any doubt. I agree that if you analyse Clause 129 as it stands, and take it to pieces with great labour and try to collect its constituent elements you might draw the inference from the words, "or claim damages" that that is what is intended. It is a great pity to draft clauses in such an extremely obscure form as to put a person of moderate intelligence, such as myself, to great pains to try to discover from the terms of the clause "Aye" or "Nay" whether you can go to Queen's Bench Division and claim damages for breach of a collective agreement. I have tried to make that plainer, and I hope I shall not be told that my words produce precisely the opposite effect. I am tired of being told that and I do not think it would be true in this case. I hope that the Minister will agree either to accept that language or to undertake to put in some language to produce the result which the Government intend. Your Lordships will see that Amendment 91B is simply part of Amendment 91A which I have just moved. It seeks to leave out the words "claim damages" and to insert the words "to obtain an award of compensation". That is necessary to complete the Amendment, and I hope that the
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Government will accept both those Amendments. I beg to move the first one.
EARL BALFOUR: My Lords, may I ask one question here? Clause 129 surely is to determine that no court other than the Industrial Court shall entertain any proceedings brought under Clause 36 of this Bill, which starts off by saying—
"It shall be an unfair industrial practice for any party to a collective agreement",
and I presume it was to make it quite clear that any breach of a collective agreement could only be settled in the Industrial Court. I am asking this as a question.
LORD DRUMALBYN: My Lords, so far as the Bill is concerned I think my noble friend is correct and the answer to his question is "Yes". Dealing with the Amendments of the noble Lord, Nos. 91A and 91B, we are wholly in sympathy with what we understand is the purpose of those two Amendments. They pare designed to strengthen the drafting of Clause 129 so that, together with the Bill's other provisions in respect of proceedings in contract, the clause will more effectively express our intentions. We are grateful to the noble Lord for putting them down, and it is with considerable reluctance that I have to say that we do not think that they have yet got it quite right—any more than we did in the Bill as printed.
My Lords, the difficulty about these Amendments is that they assume that there are no other ways of enforcing a collective agreement than those specified in this clause. Thus, their wording would replace the uncertainty it removes by another of the same kind. It would leave the way open for actions in existing courts to enforce agreements in these other ways—for example, actions in existing courts for an injunction as an alternative to, or duplicating, one in the Industrial Court for an order under Clause 101(3)(c). This is a defect which also characterises our own wording as the Bill is now drawn. However, when we come to consider a later Amendment the new clause after Clause 136, No. 91H, is closely linked both with Amendment No. 90G which we have just debated, and Amendment No. 91B, and

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also to this clause. I hope to show that the wording of Amendment 91H removes this weakness. In the light of these considerations, I hope that the noble Lord will agree to withdraw his Amendments.
LORD STOW HILL: My Lords, I am grateful to the noble Lord. I have studied very closely the new clause in Amendment 91H and my only comment is that that again does not contain any language which says precisely that you cannot ask for damages in the High Court of Justice, Queen's Bench Division for breach of collective agreement or ask for any other relief such as an injunction or account or declaration in the High Court. Therefore, it seems to me that Amendment No. 91 was subject to the same criticism I ventured to make in regard to Clause 129. Perhaps I am wrong. We shall consider it more fully when we come to that new clause. I am grateful to the noble Lord for what he said about the wording I suggested. I accept the criticism that it deals only with damages and not with injunctions, accounts or declarations. But I should have thought that that could have been put right by including a reference to the other forms of relief in the words I suggested. I agree that it is difficult to get it right. I hope he will give it further consideration and I couple with that remark the observation that I do not think that Amendment 91H quite deals with the point. Having said that I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD DRUMALBYN: My Lords, Amendment No. 91E is consequential. I beg to move.
Amendment moved—
Page 96, line 12, at end insert—
("( ) The preceding subsection does not apply to any proceedings on or in consequence of an appeal from a decision or order of the Industrial Court.").—(Lord Drumalbyn.)
LORD STOW HILL LORD STOW HILL had given Notice of his intention to move Amendment No. 91C.
Page 97, line 23, leave out subsection (4).
The noble Lord said: My Lords, this Amendment relates to a point which I ventured to put at the Committee stage. Since then I have received a letter from the noble and learned Lord the Lord Chancellor. I am most indebted to him for writing me. The letter wholly satisfies me. In those circumstances, I shall not seek to move this Amendment.
LORD HUGHES LORD HUGHES had given Notice of his intention to move Amendment No. 91F:
Page 97, line 27, after ("association") insert ("joint industry board").
The noble Lord said: My Lords, this Amendment would have been consequential on another Amendment which the Government did not accept. I therefore do not move this Amendment.
10.4 p.m.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 91G:
Leave out Clause 133.
The noble Lord said: My Lords, this is a purely paving Amendment to make way for the introduction of the new clause to follow Clause 136. It may be convenient to speak to the new clause at the same time. The purpose of the new clause is to express more precisely the Clause 133 restriction of the jurisdictions of the Industrial Court so as to make clear that besides being debarred from entertaining proceedings in tort (which Clause 133 already achieves) it is also precluded from entertaining any proceedings in contract other than those arising on jurisdictions expressly conferred on it under Part VI of the Bill. The need to do this was pointed out in Committee by the noble Lord, Lord Tangley, and the noble and learned Lord, Lord Wilberforce. I should like to say how grateful we are to them for having brought these matters to our attention. The purpose of the two Amendments is to establish more effectively and clearly the demarcation between certain jurisdictions of the existing courts and those which Part VI of the Bill confers on the Industrial Court.
We should have preferred to avoid two bites of the cherry and simply to introduce an Amendment to Clause 133. Unfortunately, the structure of the Bill prevented us from doing so, because as your Lordships will have noticed, Clause 133 fits snugly into a little trio of Clauses, 130 to 133, under the cross-heading, "Proceedings in tort". That is the right place for the clause as it is now drafted. The revised version, however, covers proceedings in contract as well as those in tort. Accordingly, we now seek to remove it to a new place in the Bill, where it can precede Clause 137, under the cross-heading "Supplementary".
The new clause first of all reproduces unchanged the provisions of the clause which the present Amendment seeks to delete. Secondly, it introduces in paragraph (b) a new provision in respect of proceedings in contract. These, when read in conjunction with Clause 129, as now amended, allocate between the existing courts and the Industrial Court jurisdictions in respect of proceedings in contract more specifically and with
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greater clarity. In oilier words, paragraph (b) sets beyond doubt that the Industrial Court has no general or implied jurisdiction in contract. Its only jurisdiction in contract is in respect of matters based on Part VI of the Bill. The Amendment covers complaints and appeals for which Part VI as printed already provides. It also covers "applications", a new provision introduced in Part VI by Amendment 85E, which the House has already accepted. The words "in consequence of" are needed to cover the possibility of proceedings for contempt of court in cases of non-compliance with an order of the Industrial Court made in remedy of a complaint.
In Committee the noble and learned Lord, Lord Wilberforce, asked about actions for damages being brought before the Industrial Court. This is a rattier obscure point. The remedies which the Court may award in respect of complaints for breach of collective agreement include compensation, but not damages. The circumstances in which the Court may award damages arise under Clause 113(1)(e) on the hearing of appeals from industrial tribunals on actions under Clause 112 in respect of damages for breach of an individual contract of employment. So it is appropriate to use the word "damages" in Clause 129, both because that is a remedy available in proceedings in contract before the existing courts and because, when Clause 112 is in force, it will also be available in the circumstances I have described from the Industrial Court. I beg to move.
LORD STOW HILL: My Lords, the last reference to damages illustrates the complications of this Bill. I understand that it refers to damages which can be granted under Clauses 112 and 113 and is coupled with damages at law in large for breach of a collective agreement. Though I do not question the accuracy of the conception, I point to the complexity. I myself have no complaint about, and, on the contrary, would approve, the removal to a separate new clause of the cluster of provisions to which the noble Lord referred. The cluster refers to a particular aspect of tort which I should have thought could well stand by itself. But I think that this is a convenient arrangement, and I hope that the House will accept it.

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I have already made in advance the comment that I think ought to be made about it: that this new clause does not contain the language which it seems to me ought to be found somewhere in the Bill; namely, language with which I sought to incorporate in my Amendment No. 91A, which would say clearly and beyond peradventure that you cannot go to the Queen's Bench Division and ask for damages for a breach of, or an injunction to restrain a breach of, or an account of profits, or a declaration in respect of, a collective agreement. Though we shall he passing this new clause, that language still does not appear in the Bill. The noble Lord, Lord Drumalbyn, has recognised the difficulty, and he has agreed that this is a difficult matter of drafting. I hope that between now and the Third Reading of the Bill he will find means to introduce that language somewhere in the Bill so as to eliminate any doubt as to whether the ordinary common law remedy in damages for breach of collective agreement under Clause 36, or any other clause, exists. It is the plain intention of the Government that it should no longer exist, and I hope that this will be stated plainly, and not by implication, as it is at present—if it is stated at all—in the language of what will now be subsection (1) of Clause 129.
LORD DRUMALBYN: My Lords, I will take note of what the noble Lord has said and pass it on to those more competent than I am to judge of these matters. Perhaps I may write to the noble Lord between now and the next stage of the Bill.
10.13 p.m.
LORD BEAUMONT OF WHITLEY LORD BEAUMONT OF WHITLEY moved Amendment No. 91:
After Clause 134, insert the following new clause
Increase of penalties for breach of contract involving injury to person or property
(".Section 5 of the Conspiracy and Protection of Property Act 1874 shall be amended by the substitution of '£200' for 'twenty pounds'.")
The noble Lord said: When this subject was discussed in Committee, the
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Government said that they wished to keep Section 5 of the Conspiracy and Protection of Property Act 1874. I think there was considerable agreements in all parts of the Committee that this was the right thing to do. One of the points made was that it was important that it should go on the Record, and be seen, that breaches of contract which might involve injury to persons and property—though here I emphasise "persons"—should be seen to be legal and to carry penalties. It was stated that the penalties as they were in the Act were inadequate, but the point was put that the mere fact that they were illegal was important. I believe that we should bring our laws up to date. If we have on the Statute Book laws which we do not like, we should do away with them; but if they serve a purpose any penalties laid down should be consonant with normal standards of today. A sum of £20 is not an adequate penalty for a breach of contract involving injury to persons. There is a case for saying that this Act should not be on the Statute Book at all; but if it is to remain, there is no case for saying that the penalty should be £20. I have merely put forward £200 as a possible increase, though, as noble Lords on the Labour Front Bench have 'pointed out at one time or another tonight, possibly by the standards of present inflation it should already be going up.
I think that it probably does a disservice to the psychological effect of having a law on the Statute Book, and having a law which people care about, if the penalties are seen to be totally derisory in terms on modern money values. This is the reason why my noble friends and I have put down this Amendment. I am informed by the Government that this is an inappropriate place for it because if we carried the Amendment it would put all the other penalties in the same Act totally out of line, and it is not appropriate for us to try to alter all the other penalties in this Act. I accept what they say and therefore shall not press this Amendment. I will merely move it, in order to invite the Government to agree with the general principle that, if there comes an appropriate time, it is right that penalties should be brought into line with modern monetary values in Acts which the Government are

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specifically keeping on the Statute Book and repeating in modern Acts. I beg to move.
EARL FERRERS: My Lords, while we recognise the desire of noble Lords that the penalties of this section of the Act should reflect more adequately present-day conditions, we doubt whether this is appropriate to the Bill now before your Lordships. I would say at the outset that there is a misprint in the noble Lord's Amendment: it refers to the Conspiracy and Protection of Property Act 1874, whereas it should be 1875. But the Government have frequently made it plain that criminal provisions should not be brought into the industrial relations field other than where there is a risk of violence or injury.
In addition to our natural reluctance, which I believe is shared by many noble Lords, to delve into the justification or otherwise of criminal penalties, there are considerable practical difficulties raised by the proposed Amendment. The noble Lord, Lord Beaumont of Whitley, said he understood that one of the objections to our acceptance of this Amendment would be the need to alter other parts of the Act, which, strictly, do not come under the Industrial Relations Bill. That is perfectly true, because Section 7 would also have to be revised. But the real problem is that the 1875 Act is not restricted in its application to industrial relations matters: it covers a far wider field. For example, Section 5 applies to any person who
"wilfully and maliciously breaks a contract of service or hire, knowing or having reasonable cause to know that the probable consequences of his action will be to endanger life."
Any wilful breach of contract to hire equipment to a hospital, for example, would be actionable under Section 5 in the circumstances set out in that section; and so could other commercial contracts for hiring. We do not believe that this Bill is the right place to make the Amendments to an Act such as the noble Lord has suggested. We accept, and are sympathetic to, his view that the figure of £20 is inadequate for the present day. Whether or not that will ever be altered in the future must remain for the future, but I do not believe that it would be right to alter it in this Bill.
LORD BEAUMONT OF WHITLEY: My Lords, at the end of a speech in which I thought that the noble Earl was entirely missing my point, he very courteously said that the Government were sympathetic to the idea that the penalties should be changed. In my opening speech I said that I entirely appreciated that this was an inappropriate place to make the Amendment—and although I got the year of the Act wrong, that no doubt could have been changed on Third Reading. However, having obtained from the noble Earl the statement that if the time ever comes when the 1875 Act is amended, the Government are sympathetic to the idea that the penalties on this particular point which they have specifically retained in this Act should be made more realistic, I am at least moderately happy. I therefore beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 91:
After Clause 136, insert the following new clause—
General restriction on jurisdiction of Industrial Court
(".The Industrial Court shall not have any jurisdiction except that which is expressly conferred on it by or under this Act; and accordingly that Court—

(a) shall not entertain any proceedings in tort, and

(b) shall not entertain any proceedings brought by a party to a collective agreement or any other contract for the purpose of enforcing the contract or obtaining any remedy in respect of it, other than proceedings on or in consequence of a complaint, application or appeal under Part VI of this Act.")

The noble Lord said: my Lords, I beg to move this Amendment, the effect of which I have already described.
10.21 p.m.
LORD STOW HILL LORD STOW HILL moved Amendment No. 92:
After Clause 136, insert the following new clause—
Protection of journalists from proceedings under this Act in respect of certain oral or written reports made in exercise of their profession.
(" —(l) For the avoidance of doubt it is hereby declared that no action or other proceedings shall be brought in any court include-

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ing the Industrial Court and any industrial tribunal by virtue of any of the provisions of this Act against any person, being a person engaged whole-time or part-time in the profession of journalism, in respect of any matter to which the next subsection applies published orally or in writing by that person in the exercise of his said profession in any newspaper, magazine or other periodical publication or in the course of any broadcast or television performance.
(2) This subsection applies to any such matter as is referred to in the preceding subsection which in so far as it consists of an allegation or allegations of fact constitutes a fair and substantially accurate account or report of the whole or some part of some happening or happenings (including a speech or other declaration delivered or made publicly whether orally or in writing) which are of public concern, and in so far as it consists of comment on such happening or happenings or such part thereof as the case may be is a fair comment thereon, or is a fair comment on some subject of public concern, or is a fair comment both on such happening or happenings or such part thereof and on such subject.
(3) For the purposes of this section the proprietors of any such newspaper, magazine or other periodical as is referred to in subsection (1) of this section and any person who in the ordinary course of his employment took any part in the publication of any such matter in such newspaper, magazine or other periodical publication, and any person, including any public authority, who or which in the ordinary course of his employment or in the ordinary course of the discharge of its public duty, as the case may be, took part in the organisation or production of such television or broadcast performance, shall be deemed to be a person engaged in the profession of journalism.
(4) In any proceedings brought by virtue of any of the provisions of this Act against any person, being a person engaged whole-time or part-time in the profession of journalism within the meaning of this section, in respect of any matter published orally or in writing by that person, it shall be presumed, unless the contrary is shown, that such matter is matter to which subsection (2) of this section applies, and if and in so far as any such proeedings are based upon an allegation or allegations that any such person induced or threatened to induce another person to break a contract to which that other person was a party, the burden of proving such allegation or allegations shall he upon the plaintiff or complainant in those proceedings.
(5) In this section the word "induce" has the same meaning as it has in section 96 of this Act")
The noble Lord said: My Lords, I beg formally to move this Amendment. This is what perhaps I may describe as the second alternative journalists' Amendment, designed to give protection to journalists. We have already discussed this topic on four separate occasions
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during the course of our debate, and I do not think I should be usefully taking up the time of the House if I again asked your Lordships to examine this new attempt exhaustively. This Amendment would protect only the professional journalist. When we met last week my noble and learned friend Lord Gardiner moved an Amendment to Clause 90 which was a little more extended in scope, but the Government intimated that they were not in a position to accept it. I will say no more about the new clause at present before your Lordships than this. Although it is substantially on the same lines as the new clause which I proposed when we were at the Committee stage of our debates, it has been recast. The noble and learned Lord the Lord Chancellor criticised the drafting of the earlier clause, and made various observations with regard to it. I did not myself, as I indicated at the time, think that any of those criticisms had any substance at all, but in drafting the clause in its present form I have sought to take account of them so far as possible.
The reason why I think it would not be useful to take your Lordships' time going into the substance of this clause is that the Government and those who promote this clause are in disagreement on the basic question whether the journalist is at any risk at all. Ministers have stated that it is their clear opinion that there is no such risk. If they are right in that view, then I and those associated with me accept that logically there can be no possible need for a new clause on the lines of that which your Lordships now have before you. Unless we can persuade the Ministers of the Government that there is a risk, as I have said, there is no point in examining the clause. We have not been able to persuade them of that, and it is for that reason that I do not invite your Lordships to consider its contents in any more detail.
I think, however, the matter ought not to be left quite there. I think it would be right that I and those associated with me in putting these proposals before the House should make it perfectly clear what our own view is on the question of risk. Ministers think there is no risk. It would be wrong, and indeed irresponsible, if I (or those associated with me

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in preparing this new clause) let it be thought that in our opinion there was a grave risk. We have never said that, and we do not think it. All the same, I find it difficult to persuade myself that there is not a slight risk; indeed, I think there is a slight risk. I gave examples, and my noble and learned friend Lord Gardiner, when he was moving an Amendment to Clause 90, also referred to the question of risk. I think it is the view of all of us who have identified ourselves with this Amendment, while there is certainly no grave risk—that we do not suggest, and never have done—for reasons which we have previously given, and which we do not now repeat, we feel that there is a slight risk, and that it cannot be completely disregarded.
What we think is a matter of some slightly greater importance is this—and this is a point which has been made by us in the course of these debates. It would be unfortunate if the journalistic profession felt any anxiety about publications which might be construed as knowingly inducing workers to strike, and if, over the years, a hesitation crept into editorial offices about publishing honest opinions in favour of workers who were either striking or minded to strike. We think that is of somewhat more importance that the slight risk that on occasions, at rare intervals, a journalist might find himself in some trouble before the courts.
We have often said from this side of the House that, in any event, we think the proceedings which are outlined in the various clauses of this Bill are unlikely to result in actual complaints before a court, and we certainly think that is the case with regard to any risks that may face journalists. I have had an opportunity of discussing this with those associated with me, and particularly with my noble and learned friend Lord Gardiner, and he has authorised me to say that he concurs in the view that I have expressed. He is present in the Chamber and I say this in his presence.
May I say that we think there is a tendency, which has been creeping in over the years, for journalists to be nervous about editorials which might be construed as having the effect of inducing workers to strike. We think the risk is slight; we certainly do not suggest that there is any grave danger to the liberty
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of the Press, and we leave it there. Of course, in those circumstances it can be said that all legislation of any substance carries with it the risk of untoward consequences which are not expected, and that the slight risk which we think is present should be encountered. If we were dealing with any topic other than the freedom of the speech and the independence of the Press, that is a point of view which, speaking for myself, I would readily accept: one always has to take some risk. But in this country we are sensitive, and rightly sensitive, to anything which could conceivably be regarded as an encroachment upon the legitimate province of criticism and comment and free speech. That is absolutely sacred to us, and for that reason we feel that it is not justifiable in this context to accept the slight risk which in other contexts could be justifiably accepted.
That is the general position that I would like to make clear before parting with this new clause. That is the position as we envisage it. I think it is useless to continue the discussion because the Government have clearly made up their minds that there is no appreciable risk, and obviously at this late stage of the Bill they will not change their minds on that. Therefore it is obviously useless to discuss possible remedies to deal with such a position. I am sure the Government Front Bench and the whole House will agree with me on that. I thought it right to explain our position. As I have said, it would be wrong and irresponsible to leave our own attitude of mind in doubt about this, or to exaggerate or magnify the gravity of any peril which we think does not exist. With that, I formally move the Amendment, and would ask the view of the House, although speaking for myself I would not seek to take your Lordships into the Division Lobby upon it.
10.30 p.m.
LORD RITCHIE-CALDER: My Lords, in this dialogue of the deaf which we are having in this debate may I go on record, since we are obviously not going to make any real impression, to point out that, as someone who has been 40 years in journalism and walked the tightrope of libel and D-Notices and the rest, I know what this kind of inhibition really means. I believe this is in fact very definitely and unquestionably an

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inhibition on the freedom of the Press, not because, as my noble friend has pointed out, we think that perhaps even under this Government this measure would be used in any punitive sense, but we do know (I know, anyway) what is in fact the meaning of this kind of thing. It in fact inhibits an editor, or whoever may decide these things, not to publish a cartoon which might be so construed, or a television producer to accept that microphone which is pushed in front of Jack Dash in the docks. That sort of thing will be cut, because whatever he may do may be interpreted as condoning or encouraging somebody who is inspiring unrest in the trade unions.
I have had a great deal of experience of this, and I can think back over a great many years in which many of the things which I was capable of doing and allowed to do, and I think in the nature of social history was important to do, would not have appeared in the British Press under a suggestion of this kind of constraint. Therefore, it is not a question of whether a Government would invoke, or a tribunal would invoke, or an employer would invoke the terms of this Bill. But I know that I have lived my life with "they". It is this unknown "they", it is "they" who do not want this, "they" who do not want that, "they" who do not allow us to do so and so. I say unequivocally this will be a restraint; and it is not a restraint on people who are deliberately contriving or devising industrial unrest but an inhibition on the freedom of the Press.
BARONESS WHITE: My Lords, I should say that I am no longer a member of the National Union of Journalists, but I once was, and before I had the honour of becoming the second woman Lobby correspondent—my noble friend Lady Lee was the first—I was an industrial correspondent, and therefore have some experience, though nothing approaching the record of the noble Lord, Lord Ritchie-Calder, of working in a newspaper office on industrial topics, including the reporting of strikes. I entirely agree with what my noble friends have said, that the real danger which we apprehend is not that there will be a lot of journalists dragged before the courts—we do not think that will happen; one may have occasional cases, but
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not very often—but that what will happen, in our submission, is that, unless one has a very clear understanding about this situation, one may have in newspaper offices the sort of situation which we all know, when you get the copy back on your desk marked "check for libel". This is very common in any newspaper office. The office nearly always keeps a tame lawyer somewhere around who makes an honest guinea—it is no longer guineas, but decimal currency—by advising on libel, and he nearly always errs on the side of caution.
If this kind of attitude were to be brought into industrial reporting, it would be very inhibiting for the journalists themselves and would be against the public interest, particularly when you are dealing with strikes or the lead-up to a strike. Anyone who has done even a small amount of this sort of reporting knows that almost always in a strike situation the ostensible reason for the strike is not the real one. I was taught this lesson by the man I have always regarded as the best industrial correspondent in my lifetime, Trevor Evans of the Express. If anybody really knew what was going on in a strike situation, it was Trevor Evans. It was he who helped me to see "below the surface" reasons.
If you make it difficult for a journalist to face his editor when he hands in his copy, because he may be told, "Look, we really dare not say this. You may be absolutely right, it may be the complete truth, but we dare not say this because it may be taken that we shall be in some way inducing industrial strife", that would be very bad for the journalist professionally, and also damaging to the public interest.
I do not wish to say more. I do know that this Bill has caused anxiety to the National Union of Journalists, and I think it has been absolutely right that my noble friend should have ventilated the matter so that we can at least indicate our fears, and so that the Government can give us assurances that, in their view, there is no such danger. I hope that that assurance will at least get to the newspaper offices in the country, and particularly the local newspapers. A big national newspaper can usually take a line, if it wants to; but with the local newspaper—which is so often where we

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have the real local interest in a strike—I think you may be in very serious danger. A much smaller newspaper, without the necessary resources if anything did go wrong, would have to face possible court action and would err very much on the side of caution. In addition, very often the journalist on the staff of such a paper is much less sure of himself than someone who has a national reputation. For all these reasons, I think we have been entirely justified in ventilating a matter which has caused very considerable concern in the profession.
10.38 p.m.
LORD DRUMALBYN: My Lord, I think we have had a useful debate on this matter, but I should like to say at once that the fears—even though the noble Lord, Lord Stow Hill, made it clear that his fear was simply in regard to a slight risk—that have been echoed tonight in the House have not been widely spread, so far as I have been able to see, in the Press as a whole. I think the reason is that, quite simply, the fears are not strongly held. It would be very sad if they were. The fact is that the Bill does not give any reason for the fears to be held, as the noble and learned Lord, Lord Donovan, himself clearly discerned in his Second Reading speech, when he pointed out that, should a correspondent advise workers to come out on strike, he would still not be liable under the Bill because it could not be shown that the workers were being advised to strike in breach of their contracts of employment. The reason for that is that it is open to the workers concerned to give due notice, and thus to take strike action which would not be in breach of their contracts.
As my noble and learned friend the Lord Chancellor said, fair reporting and fair comment could not, as such, give rise to proceedings under the Bill. If one takes that in conjunction with the explanation given by the noble and learned Lord, Lord Donovan, one can see that there is really no risk at all. This was the point that my noble and learned friend made, and to seek to insert something into a Bill which is not a
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matter of doubt can give rise to unfortunate side effects. If we were to single out journalists in the way that the noble Lord has done in his very carefully worded Amendment, the corollary of that would be to create some doubt that reports and comments made other than in the profession of journalism would give rise to some special liability under the Bill, perhaps in respect of inducement as an unfair industrial practice. Such a course would be wholly misleading and, since there is no need for special protection for journalists, the Amendment, if accepted, could have an effect which is contrary to its intention.
It is for these reasons, and for these reasons alone, that we reject the Amendment. If it really were necessary to give the Press this protection in order to enable them to do their jobs with full freedom, then of course we should be the first to concede it. But after the most careful examination we have decided that this is not necessary. I think the noble Lord, Lord Stow Hill, will accept that the difference between us is very small, since he has made it quite clear that he thinks there is only a slight risk. In view of the possible side effects of legislating in this way; in view of the fact that we believe that the Press has a pretty shrewd instinct in this matter for what is fair reporting and fair comment; and in view of the very high standards that the Press of this country maintain and their desire to avoid doing anything which they ought not to do in these respects—and one must admit that it would be wrong for the Press to induce people to break their contracts when to do so is against the law, or indeed to induce them to commit an unfair industrial practice—there is only a narrow margin between us here. In those circumstances, all I can do is to express our admiration and satisfaction for the way in which a matter of the very greatest importance has been ventilated in this House with great moderation, and to say, respectfully, that if there is a difference of opinion it is a very slight difference, and we do not believe that the need for this clause exists.
On Question, Amendment negatived.

LAND REGISTRATION AND LAND CHARGES BILL [H.L.]
MERCHANT SHIPPING (OIL POLLUTION) BILL [H.L.]
RECOGNITION OF DIVORCES AND LEGAL SEPARATIONS BILL [H.L.]
Returned from the Commons, agreed to, with Amendments: the said Amendments to be printed.

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  GIBRALTAR/UNITED KINGDOM POSTAL SERVICE