Sitting of 3 March 1971

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

    Rolls-Royce Ltd.
    Mr. Sheldonasked the Minister of Aviation Supply if he will make a further statement on Rolls-Royce.
    Mr. Barnettasked the Minister of Aviation Supply if he will make a further statement on the proposed purchase of Rolls-Royce.
    Mr. William Rodgersasked the Minister of Aviation Supply what conditions were discussed with Rolls-Royce Limited in the course of negotiations for a further loan on or about 6th November, 1970; how far they were embodied in subsequent agreements arising from the decision to provide additional launching aid for the RB211 engine; whether he is satisfied that all parties were fully aware of the Government's position; and if he will now make a statement.
    The Minister of Aviation Supply (Mr. Frederick Corfield): I will, with permission, answer this Question and Questions Nos.4 and 46 together.
    Mr. Rodgers: On a point of order. I am reluctant to interrupt business at this stage, Mr. Speaker, but you will recall that exchanges took place last Friday about certain matters concerning the RB211 and statements which had appeared in the Press that day. As a result of those statements there was an
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    exchange between myself and the Minister, who agreed to make a statement in the House early next week on this very important matter which is still causing great concern.
    With this in mind, I put a Question down to the Attorney-General which is Question No.46, now to be taken by the right hon. Gentleman the Minister of Aviation Supply. This is a wholly unsatisfactory position and will be thought to be so not only in this House but outside. May I ask through you, although I know the difficulties of precedence, that this Question should not be answered now but should be answered at the end of Question Time so that there may be a full discussion and examination of what the Minister has to say?
    Mr. Speaker: That is not a point of order. The way in which Ministers choose to group Questions is not a matter for me.
    Mr. Corfield: I was going on to say—and thereby take the opportunity of expanding on the statement I made in the House on Friday in relation to certain allegations that appeared in The Times on that morning—that in November last the Government agreed in principle to provide more launching aid for the RB211 engine. I made clear in the House on 11th November the conditions under which this launching aid was to be provided. It was subject, inter alia, to a check by independent accountants and to satisfactory contractual arrangements. These arrangements were in negotiation, pending receipt of the accountants' report, when the company went into receivership.
    The statement I made on 11th November was absolutely clear, and I do not believe that there were any grounds either for Rolls-Royce or for any of the financial institutions concerned to misunderstand the Government's position. So far as there was a question of additional bank credit, that was a matter between Rolls-Royce and the banks concerned, and it was not for the Government to explain to the banks the terms of an agreement to which they were not party. In the event, before Messrs. Cooper Bros., the independent accountants, had completed its investigations, the Board of Rolls-Royce concluded that it could not proceed with the RB211 contract without

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    vastly greater financial assistance than was ever contemplated in November—
    Mr. Benn: On a point of order, Mr. Speaker. The right hon. Gentleman is making a major parliamentary statement in such a way as to make it impossible for the House to cross-examine him and I do ask, through you, whether the Minister would be prepared, by leave of the House, to answer these Questions at the end of Question Time.
    Mr. Speaker: This is not a matter for me.
    Several Hon. Members rose—
    Mr. Whitehead: Further to that point of order. Will it be in order for the Chair to receive supplementary questions which relate to the statement which the Minister is now making as well as to Question No.1?
    Mr. Speaker: The question of allowing supplementary questions is a matter for me, and I will rule on it when the time comes. The practice of points of order during Question Time is very much to be deprecated. [interruption.] There are a great many questions about Rolls-Royce on the Order Paper and it would be better if the House got on with the business.
    Sir G. Nabarro: On a point of order, Mr. Speaker. On three consecutive occasions complaints have been made from both sides of the House that hon. Members are not able to reach Ministers cited as beginning at, say, Question No.35, as, for example, today the Lord President of the Council. Have you observed my Question No.38, which will not be reached if the abuse of the House of which my right hon. Friend is guilty continues?
    Mr. Speaker: The hon. Gentleman's point of order has only delayed that possibility a little further.
    Mr. Corfield: I conclude by reminding the House that the Rolls-Royce board then decided that in these circumstances it could not continue trading in conformity with its obligations under Section 332 of the Companies Act, even if the additional £42 million launching aid and the extra credit facility from the banks were provided in full. No part of this money had been paid, nor did the accepting parties'
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    commitment in November to renew their facilities to Rolls-Royce after April, 1971, become operative.
    Mr. Sheldon: But is the right hon. Gentleman aware that what he said on 9th December was not precisely that? He said that the moneys available to Rolls-Royce were not dependent on the outcome of the accountants' report. If the House was misled, is it not likely that the banks and other companies were also misled? What representations has the right hon. Gentleman had from the banks about this matter?
    Mr. Corfield: The answer to the last part of the hon. Gentleman's supplementary question is "none". I think that that indicates that there is a good deal of evidence that they did not feel that they were misled by anything I said in the House.
    Mr. Barnett: Would not the hon. Gentleman agree that there has been a little confusion in the matter, to put it no higher? After the statement of 9th December. would it not be. if not the legal thing to do, the honourable thing to do to pay in full the sub-contractors and others who gave credit after that date? Would the hon. Gentleman also contradict the reports which appear to indicate that he is trying to buy the assets of Rolls-Royce on the cheap and so prevent the sub-contractors and creditors from getting an adequate return?
    Mr. Corfield: I am very anxious to contradict those reports. There is no question of the Government negotiating on anything other than the basis of a fair price. As I have explained in the House, I understand that the Receiver is entitled to the basis of a valuation most favourable to him.
    Mr. Rodgers: I make it clear that we regard the statement made by the Minister in this form as totally unsatisfactory. As my Question No.46 was tabled to the Attorney-General, it is clear that the right hon. and learned Gentleman is not prepared to fulfil his obligations in the House and answer for his part in the matter.
    In our debate on Friday the Minister of Aviation Supply said that his Department had seen the heads of agreement

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    between the banks and Rolls-Royce. I understand that this was after the meeting at which the Minister made clear, as he believes, the conditions on which the £42 million was available. Would he say now whether the heads of agreement included reference to the conditions which he put in the House on 11th November? If they did not, Why did not his Department draw attention to this matter? Will he publish all the relevant contract documents relating to that period so that we may see precisely how matters stand?
    Mr. Corfield: As I made clear on Friday, the note on the meeting which I had with Rolls-Royce made it abundantly clear that these arrangements were subject to investigation by independent accountants. The heads of agreement between the banks and Rolls-Royce were matters to which the Government were not party. I do not believe that the condition was specifically referred to, but I think that it was clear.
    Mr. McLaren: Does my hon. Friend think that the Rolls-Royce affair and the Concorde are inextricably linked, as some have suggested, or does he recommend us to treat them as separate matters?
    Mr. Corfield: In my view, they are entirely separate matters, and my information is that this is the general view in America and on the Continent.
    Mr. Leslie Huckfield: This is not satisfactory at all. Is not the Minister aware that in an internal communications memorandum submitted to the joint shop stewards of the Rolls-Royce factory at Parkside, Coventry, the shop stewards were given to understand that the £60 million had already been made available?
    Mr. Corfield: I had no idea of that, and it is not my responsibility. But what is abundantly clear to everybody who understands these things is that launching aid is always paid subject to a contract whereby the tranches are paid in relation to the stage which the engine has reached.
    Mr. Dykesasked the Minister of Aviation Supply when he expects to make the necessary valuation of the purchase cost of Rolls-Royce by the Government.
    Mr. Deakinsasked the Minister of Aviation Supply what criteria his Department has used in determining a purchase
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    price for the undertaking and assets of Rolls-Royce Limited.
    Mr. Corfield: The price to be paid for the Rolls-Royce assets acquired from the receiver by Rolls-Royce (1971) Ltd and the criteria to be employed in deciding this are essentially matters for negotiations which are currently in progress. I cannot, however, say when agreement will be reached.
    Mr. Dykes: I am grateful to my hon. Friend for that answer. There is a difficulty and natural uncertainty, but, to provide additional guidance to the House, can he say whether he feels that in the ultimate the difference between assets to be purchased by Rolls-Royce (1971) from Rolls-Royce Ltd. and the assets to be retained permanently will be negligible, substantial or as large as the original gross figure?
    Mr. Corfield: That is a matter of pure speculation, because a great deal must depend on the success or otherwise of the negotiations currently taking place, to which I am returning immediately after Question Time.
    Mr. Deakins: Does the hon. Gentleman agree that it is in the interests of the nation, the unsecured creditors of the Rolls-Royce company and its employees that the purchase price should be as generous as possible bearing in mind the worldwide reputation which Rolls-Royce enjoys and the fact that the Government are to buy those parts of the company which are a going concern?
    Mr. Corfield: That is not entirely true of all the assets. I cannot add to what I have said.
    Mr. Rost: Is my hon. Friend aware that over the past 24 hours there has been an increase in anxiety among the sub-contractors and creditors, not because they have not had any statement on whether they will get payment and, if so, how much, but simply because they do not have any official representation with the Receiver nor any way of achieving any such representation unless they themselves appoint a liquidator, which they do not want to do, although we may be getting to the point at which that will be necessary?
    Mr. Corfield: If there is any lack of liaison of that sort I will certainly

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    draw it to the attention of the Receiver, but I have not been aware of it hitherto.
    Mr. Barnett: Will the hon. Gentleman confirm that he will not rule out the possibility of saving a lot of money for unsecured creditors not by having a liquidation but by having a composition with them?
    Mr. Corfield: I made that clear on Friday.
    Mr. Dalyellasked the Minister of Aviation Supply what study he has made of the production capability, financial position, and indebtedness of firms a large part of whose output was geared to sub-contracting for Rolls-Royce.
    Mr. Scott-Hopkinsasked the Minister of Aviation Supply whether, in view of the nationalisation of the aero-engine division of Rolls-Royce, he will recommend continuance of those contracts negotiated by the former company, Rolls-Royce, with its suppliers of component parts for the aero-engines already in production, such as the Spey engine.
    Mr. Arthur Lewisasked the Minister of Aviation Supply whether he will make a further statement on the Rolls-Royce situation; whether he will publish in HANSARD a detailed list of the sub-contractors which will be affected by the Rolls-Royce disaster; and what action he has taken, or intends taking, to safeguard these sub-contracting firms.
    Mr. Corfield: As I told the House in the debate on 11th February, I put in hand at the earliest possible moment a study of the problem of the sub-contractors. This study had regard to the liabilities of Rolls-Royce to its sub-contractors as far as it was known to us and the manpower and financial position of these firms. The steps stated by the Chancellor in the debate on 8th February in respect of sub-contractors' needs for additional temporary finance have been taken, and any cases of particular difficulty have been discussed with the receiver, who has taken such measures to assist as are open to him in order to safeguard the continuity of supplies.
    While I anticipate that the new company, Rolls-Royce (1971) Ltd., would
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    wish at any rate to continue such contracts as relate to engines already in production, it will I am sure be appreciated that the detailed arrangements must be a matter between it and the individual suppliers.
    Mr. Dalyell: When is the study to be completed?
    Sir G. Nabarro: A jolly good short question.
    Mr. Corfield: As I explained on Friday, the study is really a continuing process. We have had a major study, but there are other factors.
    Mr. Scott-Hopkins: Will my hon. Friend agree that what these firms need is certain knowledge of how soon the contracts will continue and that they need to know it at the earliest possible stage, and will he do all he can to expedite this matter?
    Mr. Dalyell: Time is not on your side.
    Mr. Corfield: As I have already explained, I think it is clear that most suppliers supplying in relation to engines already in production will be required by the new company.
    Mr. Arthur Lewis: Will the Minister now answer the second part of my Question?
    Mr. Corfield: I do not think it will help sub-contractors or be a great deal of help to the House to answer this.
    Mr. Lewis: Why did not the right hon. Gentleman say that in the original answer?
    Mr. Dalyellasked the Minister of Aviation Supply what is his latest technical assessment of the RB211 engine.
    Mr. Corfield: It has been performing well in the development flight programme. Various technical problems remain; I am confident that they could be solved; it is a question of time and cost.
    Mr. Dalyell: Does the Minister recognise that Mr. Daniel Haughton, of Lockheed, without, as far as I know, seeing the report of Sir William Cook, has already said that it is an excellent engine? Does he draw his own conclusions from that remark?
    Mr. Corfield: I think there are other alternative conclusions which can be drawn, but I certainly will draw one.
    Mr. Benn: Will the right hon. Gentleman tell the House that the problem now is not the technical problem of the RB211 but simply the problem of negotiating a settlement with Lockheed and the airline customers?
    Mr. Corfield: It is a question of the time scale which is acceptable to both Lockheed and the airlines, and a question also of cost.
    Mr. Adley: Is my hon. Friend aware that the Federal Aviation Administration and the airlines in America believe that the problem of the RB211 was the problem of the original contract?
    Mr. Corfield: This, I think, has been basic to all our discussions.
    Mr. Jay: Will the Minister not at least agree that, whatever mistakes may have been made in the past, there is now an overwhelming case for renegotiating this contract if that can possibly be done?
    Mr. Corfield: If it can be done on reasonably acceptable terms.
    Mr. Willeyasked the Minister of Aviation Supply whether he will make a statement on the position of Rolls-Royce factories in Sunderland.
    The Parliamentary Secretary to the Ministry of Aviation Supply (Mr. David Price): No decision has yet been taken about which of the Rolls-Royce Ltd. factories are, or are not, to be acquired for operation by Rolls-Royce (1971) Ltd.
    Mr. Willey: Does the hon. Gentleman realise that that is not much comfort, and that the question of the future of the Sunderland factory cannot be divorced from Government policy for the development areas, nor from the fact that in Sunderland we have the highest persistent unemployment of any town in Britain? Can he assure me that these factors will be borne in mind when the future of this factory is decided?
    Mr. Price: I can assure the right hon. Gentlemen that the effect on this set of factories is not forgotten by my Department, but, clearly, I must remind him that there are a number of other Rolls-Royce factories in development districts.
    Mr. Scott-Hopkinsasked the Minister of Aviation Supply, what plans he now has for future production of the RB211 of Rolls-Royce.
    Mr. Wilkinsonasked the Minister of Aviation Supply whether he will now make a further statement on the Lockheed/Rolls-Royce RB211 contract, and on its effect on the British aero-engine and component industries.
    Mr. Croninasked the Minister of Aviation Supply if he will make a statement on his policy with regard to the supply of Rolls-Royce engines for the Lockheed TriStar aircraft.
    Mr. Rankinasked the Minister of Aviation Supply what further steps he has taken in seeking to negotiate a new contract to enable the development of the RB211 engine for the Lockheed TriStar to be completed, and with what measure of success.
    Mr. Corfield: Negotiations with Lockheed started yesterday, following a careful appraisal of the basis on which a new agreement might rest. Both parties are very conscious of the advantages that would accrue from going on with RB211, but it is too early to say whether a satisfactory means of doing so can be found.
    Mr. Scott-Hopkins: Will my hon. Friend accept that everybody hopes that these negotiations will be concluded satisfactorily and wishes him and my right hon. Friend all luck and good fortune in the negotiations? Will he accept also that it would be utterly wrong for the British taxpayer to have to subsidise or keep out of bankruptcy American companies, Lockheed and the airlines?
    Mr. Corfield: I am grateful to my hon. Friend for the first part of his remarks. Of course the second part is a factor which has to be taken into account.
    Mr. Wilkinson: Will my hon. Friend have regard to the second part of my Question, in particular that this engine has a crucial impact on sub-contractors in the Bradford area, Hepworth and Grandage, whose turbine division produces 50 per cent. of Rolls-Royce turbine blades, and that the Rolls-Royce RB211 is something like 18 per cent. to 20 per

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    cent. of that company's work, that it already stands to lose £1·6 million, and that 170 men are already out of work?
    Mr. Corfield: I appreciate that a situation such as my hon. Friend has described may well be inevitable in certain cases, but I have nothing to add to what I have said earlier.
    Mr. Cronin: Will the hon. Gentleman bear in mind that, apart from other considerations already mentioned to the House today, this contract is of crucial importance to Rolls-Royce workers, and that if Rolls-Royce workers were sufficiently exasperated as to withdraw their labour at some time in the future that would cause the grounding of most of the Royal Air Force and of a very large number of airlines throughout the world?
    Mr. Corfield: I realise that this is crucial, but I think that it is rather inappropriate to make the sort of remark which the hon. Member has made.
    Mr. Rankin: To save the RB211, are the Government prepared to come to an agreement to purchase Lockheed TriStars for that purpose?
    Mr. Corfield: No. I could not give any commitment of that sort.
    Mr. Dixonasked the Minister of Aviation Supply, in view of the involvement of Her Majesty's Government in the financial affairs of Rolls-Royce Limited, whether he has made an estimate of the average earnings of employees in that company in 1971.
    Mr. David Price: No, Sir. With the present uncertainties it is not possible to make a useful forecast for 1971.
    Mr. Dixon: Since the earnings of Rolls-Royce workers have in the last five years risen at an annual rate of about 2 per cent. higher than in British industry generally, does this not demonstrate that if they had no more than kept level with the national average Rolls-Royce would have saved about 10 per cent. of its total wage costs, about £13 million in 1970 and an even larger amount in 1971, and that all these savings would go a long way towards solving the company's problems?
    Mr. Price: In my judgment, wage inflation has not been a critical factor in the RB211 project. It lay in the nature of the contract itself.
    Mr. Orme: Will the Minister not agree that labour relations within this company have been excellent over a long period of years, that productivity has been high, and that wages have not been in excess of what has been earned generally in industry by the types of skill which these workers have?
    Mr. Price: I am sure the hon. Member is right in that there have been good relations. I would not be prepared, having been a professional industrial engineer, to make a general judgment on all Rolls-Royce workers off the cuff.
    Dr. Gilbertasked the Minister of Aviation Supply if he will make an estimate of the total penalties or damages likely to be incurred by Rolls-Royce Limited as a result of its failure to supply the RB211 engine in accordance with the terms of its contract with the Lockheed Corporation.
    Mr. Corfield: Both liquidated and unliquidated damages could be claimed under the contract. It is not possible to make an accurate assessment beyond what has been said already.
    Dr. Gilbert: Will the Minister not give us an assessment of the penalties for late delivery, as distinct from non-delivery, if the engines were either six or 12 months late? Does he realise that he is fast losing the original sympathy of the House in his difficulties by his evasive answers and, in some cases, no answers at all? In Committee on the Bill I asked him several questions which he said he would study in HANSARD and answer. That was on 12th February, and I have not heard a word from him.
    Mr. Corfield: I apologise for the delay, but, as I explained on Friday, a good deal of work is being done on these matters. I really cannot give arithmetical answers to things that are unquantifiable. The £50 million mentioned by my right hon. Friend the Chancellor of the Exchequer was in relation to a six-months' delay, but it was an estimate by Rolls-Royce of the magnitude of the claims with which it might be faced. One cannot be accurate on this.
    Dr. Gilbertasked the Minister of Aviation Supply if he will make a statement about the progress made so far in meeting the claims of the unsecured

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    creditors of Rolls-Royce Limited with respect to debts owed by that company as of 4th February, 1971.
    Mr. Corfield: No, Sir. This is a matter for the receiver.
    Dr. Gilbert: Is the right hon. Gentleman still saying that he is not prepared to take a political decision on the price he will pay for the assets based on the return he wants the unsecured creditors to get? Are any of the unsecured creditors availing themselves of the suggestion of his hon. Friend, namely, that they should try to renegotiate their contracts with Rolls-Royce (1971) Limited at a higher price than the previous contract so as to recoup some of their losses?
    Mr. Corfield: In reply to the first part of the supplementary question, one cannot take a political decision on price. It must be based on valuation. In reply to the second part of the supplementary question, I have no information, but the hon. Gentleman will bear in mind that the board of Rolls-Royce (1971) Limited has been in being for less than a week.
    Mr. Kenneth Lewis: Despite what was said earlier, does my right hon. Friend not agree that the workers and the staff of Rolls-Royce in recent weeks have done a great deal to assist the company, and, therefore, the creditors, not only by not striking but by working extra hours to try to save the company in which they are involved?
    Mr. Corfield: Yes, Sir.
    Mr. Benn: Will the right hon. Gentleman say whether the Government assume legal liability for the further money that will be owed to the component manufacturers following the decision to keep their supplies going to Rolls-Royce for the three-week interim period for the production of the RB211?
    Mr. Corfield: I thought I had made it clear that the Government had agreed to indemnify the receiver, which I think answers the right hon. Gentleman's question.
    Mr. Pavittasked the Minister of Aviation Supply if he will list in the OFFICIAL REPORT the firms in Park Royal and Alperton in the Brent, South constituency supplying parts in connec-
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    tion with orders placed by Rolls-Royce or his Department.
    Mr. David Price: The Department does not have this comprehensive information in respect of firms which are suppliers and sub-contractors to its main contractors, including Rolls-Royce. 1 am listing in the OFFICIAL REPORT those firms that can be identified as located in Park Royal and Alperton that received direct contracts from our Department in 1969–70.
    Mr. Pavitt: Is the Minister aware that in the last few years more than 40 factories have closed down in these areas because of rationalisation and that 2,000 workers were made redundant by the A.E.I.-G.E.C. merger? Will he use his influence to keep open Rotax, where 700 workers are being made redundant, by giving that firm the aircraft industry work which is available instead of having it transferred out of my area?
    Mr. Price: I am aware of the problems in the hon. Gentleman's constituency, but he will realise that I have no direct influence over how contractors of the Department decide to spread their sub-contracts.
    Following is the information:
    List of firms in Park Royal and Alperton that received Ministry of Aviation Supply contracts for various equipments in 1969–70:

    L. T. Adams Ltd.

    Amplivox Ltd.

    British Gear Grinding & Manufacturing Co. Ltd.

    Erma Ltd.

    Kaynar (U.K.) Ltd.

    La Mont Steam Generator Ltd.

    M.C.P. Electronics Ltd.

    Mining & Chemical Products Ltd.

    Park Royal Vehicles Ltd.

    Silica Gel Ltd.

    Servo Consultants Ltd.

    Sky-Lines International Ltd.

    Shawford Control Gear Co. Ltd.

    Transradio Ltd.

    Mr. Hugh Jenkinsasked the Minister of Aviation Supply whether, in his discussions on Government help for the RB211 engine, he will bear in mind that it is less noisy and likely to have a longer useful life than the Concorde Olympus engine.
    Mr. Price: It is true that RB211 is less noisy than Olympus 593. But which engie will have the longer useful life is not clear.
    Mr. Jenkins: Is it not the case, as was shown by the reception given to the right hon. Gentleman's last answer, that the Government are flogging a dead horse with the Concorde? Is it not understandable that, while hon. Members on both sides of the House with constituency interests in Concorde should continue to press the Government on this matter, in regard to the country as a whole, since we can only support one major aero-engine development, should we not transfer the Government interest away from Concorde to the RB211?
    Mr. Price: I do not regard the two things as linked. One is supersonic and the other is an engine for a subsonic aircraft. They are not the same. The use of resources is a very much wider matter and should not be discussed in exchanges in supplementary questions.
    Mr. Michael McNair-Wilsonasked the Minister of Aviation Supply whether, in view of the bankruptcy of Rolls-Royce Limited, and of Her Majesty's Government's intention to purchase the Company, he will now publish the Industrial Reorganisaiton Corporation's report on Rolls-Royce Limited.
    Mr. Corfield: No, Sir.
    Mr. McNair-Wilson: Is my hon. Friend aware that many of us are interested in this report since it could have been a base document on which we might have learnt so much more about Rolls-Royce? Was the report made only to Rolls-Royce or also to the Government? Is it an accountants' report, and, if it is not, why has there been such secrecy about its contents?
    Mr. Corfield: The situation is that these reports have always been based on the assumption that any information given would be treated in strict confidence. The right hon. Member for Bristol, South-East (Mr. Benn) is on record as having recommended this at the time of the passing of the Bill. I have always thought that we should stick to it. Once the I.R.C. or anybody else has taken advantage of that situation, it would be wrong to go against it. As to the nature of the report, it was initially handed to Rolls-Royce but parts of it were made available to my Department.
    Mr. Dalyell: If the Government stick to their attitude that this is simply a matter for the Receiver, how can Members of Parliament in good faith say to sub-contractors, "You must go on supplying"? We just cannot do this.
    Mr. Corfield: This is a question about the I.R.C. report.
    Sir G. Nabarro: Would my hon. Friend recognise that Members, irrespective of where they sit in the House of Commons, have a real interest in full employment in their respective constituencies? If he takes this obdurate view that he cannot make available information about sub-contractors' liabilities or the situation of creditors of Rolls-Royce, is he not handicapping severely men like myself who seek to secure proper employment for Joseph Lucas employees—a company which is owed some £9 million by Rolls-Royce?
    Mr. Corfield: With due respect to my hon. Friend, I have not suggested that that information is confidential. I am referring to the report by the I.R.C. which was drawn up on the basis that the information given to it was confidential.
    Mr. Benn: But is the right hon. Gentleman aware that since I gave that original answer Rolls-Royce has gone bankrupt and the I.R.C. has been wound up? This document is vital and should be made available to the House as part of the assessment of the history of the Rolls-Royce contract. I must ask him again whether he is ready to have a Select Committee to which all these documents could be made available and which could go into the whole of this story?
    Mr. Corfield: I do not believe that a Select Committee, as opposed to an inquiry by the Department of Trade and Industry, is the best way to investigate these matters. I am prepared to undertake that the document will be made available to the departmental inquiry.
    Mr. Edelmanasked the Minister of Aviation Supply whether he will move to appoint a Select Committee to inquire into the origin and circumstances of the Rolls-Royce insolvency.
    Mr. Corfield: No, Sir. The board of the company is to call a special meeting

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    to request an inquiry under the Companies Act, 1948. This, I think, is the right procedure to follow.
    Mr. Edelman: Does not this bankruptcy involve not only matters of commercial conduct but also questions of Ministerial honour? Is not a departmental inspection quite the wrong way of probing so far-reaching a national catastrophe?
    Mr. Corfield: The terms of reference of the inquiry by the Department of Trade and Industry are clearly laid down. I see no reason for treating Rolls-Royce any differently from anybody else. Where the inquiry involves the conduct of certain individuals in Rolls-Royce, investigation by a Select Committee would have certain disadvantages.
    Mr. Maxwell-Hyslop: Will my right hon. Friend bear in mind that some of the people who might wish to be interrogated in such an inquiry might, by the time the inquiry comes off, be employed somewhere else in the world and would he also bear in mind the fact that the accuracy of memory generally does not increase with the passage of time? Does this matter not need to be expedited? Many people will be surprised to learn that the directors have not yet convened a meeting to request such an inquiry.
    Mr. Corfield: I hardly think anybody would be surprised to learn that it has been impossible to convene a meeting during the postal strike.
    Mr. Dalyell: Give the hon. Member an answer!
    Mr. William Rodgers: May I ask the right hon. Gentleman to reflect carefully on the situation which we have now reached? He has failed today to give satisfactory replies on matters with which we hoped the Attorney-General would deal, and he failed on Friday to answer a whole list of questions put to him in the course of my hon. Friend's debate. If the right hon. Gentleman is unwilling to agree to a Select Committee, surely in the interests of this House the time has now come to place the facts before us in the form of a White Paper.
    Mr. Corfield: The right hon. Gentleman is being unfair. During that debate I spent the whole half hour of my wind-
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    ing-up speech answering questions. It is hardly surprising that I did not get to the end of them all.
    Mr. Walter Johnsonasked the Minister of Aviation Supply why Her Majesty's Government have not appointed to the board of Rolls-Royce (1971) Company Limited someone with experience of the organisation of workers such as a full-time trade union official.
    Mr. Corfield: In making appointments to the board of Rolls-Royce (1971) Ltd. the Government's aim was to secure the strongest possible managerial team. Those who have joined the board were invited to do so as individuals, not as representatives of particular interests.
    Mr. Johnson: Would the right hon. Gentleman agree that it is important for the new Rolls-Royce to get off to a good start, and that it is absolutely essential that it should quickly gain everybody's confidence, including that of the staff? May I assure him that one way of achieving this would be to appoint a workers' representative, since in this way he could be sure that the staff would have confidence in the company? Would the Government be willing to reconsider this point?
    Mr. Corfield: I accept that it is important to get off to a good start and restore confidence, but the hon. Gentleman and the House will agree that the main weaknesses in the old Rolls-Royce company was in management.
    Mr. Heller: Will the right hon. Gentleman accept that there is very deep feeling in various parts of the country, such as Liverpool, where there are about 1,000 Lucas workers who are threatened with dismissal because of the Rolls-Royce situation and who are now on a three-day week? Is not it clear that we must have a management at Rolls-Royce which will also be concerned with the problems of workers in other parts of the country who are affected directly as a result of the Rolls-Royce debacle?
    Mr. Corfield: I accept that.
    Mr. Millanasked the Minister of Aviation Supply if he will make a statement of his conclusions on the schemes

    1695
    that have been put to him for assisting the financial position of the unsecured creditors, particularly sub-contractors, of Rolls-Royce Limited.
    Mr. Corfield: No, Sir. I am still examining those which have been put to me, and I am awaiting further proposals.
    Mr. Milan: Is not the right hon. Gentleman aware that the creditors are beginning to lose patience with the Government? Is not it a fact that whatever the right hon. Gentleman says about continuing contracts, they are of no use to the debt position on 4th February, and that it is that position which is likely to send many unsecured creditors into bankruptcy, with further liquidations? Even if the Government have no legal obligation, in the exceptional circumstances of the collapse of Rolls-Royce will not the Government take on some kind of obligation to look at problems affecting creditors who may otherwise go into liquidation, with subsequent redundancies, and allow some financial help at least to them?
    Mr. Corfield: I cannot go further than I have gone already. I am examining these matters, and they are being considered seriously.

    Concorde
    Mr. Sheldonasked the Minister of Aviation Supply if he will now make a further statement on the progress of the Concorde aircraft.
    Mr. Barnettasked the Minister of Aviation Supply if he will make a further statement on the Concorde aircraft.
    Mr. Dykesasked the Minister of Aviation Supply if he will make a progress report on the development of Concorde and the Olympus 593 engine.
    Mr. David Price: I have nothing to add to the reply my right hon. Friend gave to the hon. Member for Ashton-under-Lyne (Mr. Sheldon) on 10th February.—[Vol. 811, c. 496–8.]
    Mr. Sheldon: What is the present estimate for the Concorde aircraft? Can the hon. Gentleman comment on the obvious reluctance of B.O.A.C. to operate this aircraft? What pressure does he intend to bring on the corporation?
    Mr. Price: There is a Question later on the Order Paper concerning the point raised in the first part of the hon. Gentleman's supplementary question, and it would be fairer to the hon. Member who tabled that Question to answer it then. I have seen the article in question in the Observer. It was, as B.O.A.C. stated, an over-simplification of a complex issue. I do not think that this kind of one-sided speculation is helpful to the project.
    Mr. Barnett: Has the hon. Gentleman seen the speech of the Prime Minister in which he pointed out that it was not Government policy to pour money away without getting an adequate economic return? Surely the Government have made a calculation of the economic return on Concorde based on various levels of sales. Does not the hon. Gentleman owe it to the House to tell us what those calculations are?
    Mr. Price: The hon. Gentleman will know that these and many other matters will be the subject of review between ourselves and our French partners later this month.
    Mr. Dykes: As this is an intergovernmental project, will the Government be considering the possibility of making their own approaches to other airlines and B.O.A.C.? That can be important to potential Concorde sales.
    Mr. Price: It has been the practice under the joint agreement for the sales approaches to be made direct by the firms concerned and not by the Government.
    Mr. Benn: When is the selling price to be agreed with the French, and when are the further production orders for aircraft seven to ten likely to be announced? Is the hon. Gentleman aware that, to my certain knowledge, at least one customer airline in the United States has declined to discuss its purchase of Concorde until the RB211 question has been settled satisfactorily?
    Mr. Price: The matters raised by the right hon. Gentleman in the first part of his supplementary question will feature prominently in the discussions with the French to take place later this month. I should be grateful for any detailed information which the right hon. Gentleman likes to let me have on the last part.
    Sir Harmar Nicholls: As the Minister of Aviation Supply said a few moments ago that the RB211 and Concorde were separate matters and should be kept separate, has my hon. Friend's Department any evidence to show that the flagrant attempts by the right hon. Member for Bristol, South-East (Mr. Benn) to link them for narrow selfish party reasons is likely to injure the Concorde project? Is there anything we can do to stop this obscene interference with important matters?
    Mr. Price: I am inclined to think that exchanges across the Floor of the House have very little relevance for potential purchasers of this aircraft.
    Mr. Cronin: Does the hon. Gentleman admit that the very unfortunate remarks of the Minister of Aviation Supply last week about the RB211 affair have had a very prejudicial effect on Concorde and the RB211 negotiations?
    Mr. Price: I have no evidence to support the hon. Gentleman's charges, and I do not think that he helps the prospects of Concorde by continuing to repeat them.
    Mr. Deakinsasked the Minister of Aviation Supply what technical and scientific advice he has received about the tail rudder of Concorde; and whether he will make a statement.
    Mr. David Price: None, Sir. There are no current development problems associated with the Concorde rudder.
    Mr. Deakins: Can the Minister assure the House that all necessary technical steps have been taken to ensure the safety and reliability of this very important part of the structure of the aircraft?
    Mr. Price: Yes, I can. Modifications were introduced over two years ago to guard against the possibility of flutter in the rudder, and I can assure the House that there is no flutter problem.
    Mr. Matherasked the Minister of Aviation Supply if he will make a statement about the latest Ministerial meeting with the French Government on the Concorde aircraft.
    Mr. David Price: The meeting with M. Chamant on 18th February was one
    1698
    of a regular series of meetings to consider the progress of the Concorde project and to prepare for our review of the project as a whole later this month.
    Mr. Mather: Will my hon. Friend give an assurance that the French aircraft industry has the capacity to deal with Concorde and the A300B without work on the Concorde project being held up?
    Mr. Price: Broadly, I can give my hon. Friend the assurance he asks for.
    Mr. Wilkinsonasked the Minister of Aviation Supply whether he will now make a further statement on production funding for Concorde.
    Mr. David Price: I have nothing to add to the answer that my right hon. Friend gave to my hon. Friend on 20th January.—[Vol. 809, c. 1040–1.]
    Mr. Wilkinson: I emphasise to my hon. Friend the point made by the hon. Member for Ashton-under-Lyne (Mr. Sheldon), that it is imperative to get production going soon. Does he realise that if he were to look at Aviation Weekly of 8th February he would see that the Americans, of all people, are describing Concorde as the strongest challenger in history to American domination of the international transport market?
    Mr. Price: My hon. Friend will appreciate that the major review at the end of this month will be the proper time to discuss and make decisions about future production.
    Mr. Rodgers: Has agreement yet been reached, either with B.A.C. or with the French Government, about the selling price of Concorde? If not, when does the Minister expect such an agreement, and what provision has he in mind in the selling price for research and development costs?
    Mr. Price: These are matters which I should prefer not to comment on today and which will be very much the subject of my right hon. Friend's discussion with M. Chamant in March.
    Mr. Leslie Huckfieldasked the Minister of Aviation Supply (1) when definite performance guarantees on Concorde will be presented to airlines holding options;

    1699
    (2) whether he will make a further statement on Concorde's options and orders now placed by airlines.
    Mr. David Price: The manufacturers are evaluating the results of flight and other trials with a view to commencing discussions with airlines in the near future.
    With regard to options placed by airlines, I have nothing to add to the answer I gave the hon. Member for Newark (Mr. Bishop) on 10th February.—[Vol. 811, c. 162.]
    Mr. Huckfle1d: Is the hon. Gentleman aware that the performance guarantees and the attitudes of the airlines towards them at this stage of Concorde are vital? Will he also bear in mind that in the minds of many American airlines there is a definite link between their attitude to Concorde and their attitude to the RB211?
    Mr. Price: I cannot honestly agree with the hon. Gentleman on his latter point. We have had an exchange on this already, and he does not help Concorde, which I know he wants to succeed, by repeating these comments.
    Mr. Adley: Does the Minister recognise, now that we are approaching the marketing period for Concorde, that the Government should accept some responsibility with the manufacturers for the promotion and sale of the aircraft? Will he give serious consideration to a campaign in this country and the United States to influence public opinion favourably towards supersonic transport?
    Mr. Price: These are all matters to be considered after the decisions of the March review.
    Mr. Dempseyasked the Minister of Aviation Supply what estimate he has made of the effect of sonic booms from the Concorde when flying over the Scottish coast on persons and property; and if he will make a statement.
    Mr. David Price: Ten supersonic test flights have taken place down the West Coast of Scotland so far. Forty-one letters of complaint have been received, and, in addition, there have been 67 claims for damage. Thirty-two of the damage claims have been accepted and £645 has been paid in compensation. Three claims have
    1700
    been rejected, and the remainder are still being investigated.
    Mr. Dempsey: Has the Minister studied carefully the effect of the sonic booms on the persons who were interviewed and on the buildings which were instrumentally monitored? Will he confirm that when Concorde becomes operational it will not fly at supersonic speeds along the West Coast of Scotland and Britain and over the mainland?
    Mr. Price: On the first group of supplementary questions, if the hon. Gentleman remembers that there were more than 400,000 people within the sonic boom carpet of these tests, the number of complaints is not excessive. The second part of his question is a matter for my right hon. Friend the Secretary of State for Trade and Industry.
    Mr. Brewis: Is my hon. Friend aware how little inconvenience seems to have been caused in my constituency by the tests, and how pleased people are to be able to contribute to the future of this excellent plane?
    Mr. Price: I am grateful for those remarks. This is a typical reaction in many parts of the country under the test path. I am sure the House will realise that many people think they are playing their part in a great national endeavour in suffering from these test flights.
    Mr. Adleyasked the Minister of Aviation Supply what assessment he has made of the effect upon the Concorde programme of the simultaneous development of the TU144; and if he will seek a meeting with his counterpart in the Government of the Union of Soviet Socialist Republics to discuss matters of mutual interest.
    Mr. David Price: On information currently available we do not expect competition from the TU144 to have a significant effect on the potential market for Concorde. In all the circumstances my right hon. Friend sees no need to arrange a meeting with the Soviet Minister of Aviation.
    Mr. Adley: Would not the hon. Gentleman agree that we have powerful allies in the Russians and in our French friends and that between us we could ensure that no unjustified political pressure is brought

    1701
    to bear on Concorde? Would he do his best to see that so far as possible the three countries involved in supersonic programmes maintain a united front?
    Mr. Price: The particular problems my hon. Friend has in mind have not yet arisen with regard to the Soviet supersonic aircraft. I am not yet aware of any intention to fly the aircraft outside the Soviet Union.
    Mr. Bean: Would the Minister take the opportunity of denying the story which appeared in the Sunday newspapers that on resource grounds the Government could only fund the RB211 or the Concorde? He made some reference to this matter a moment ago in answer to my hon. Friend the Member for Putney (Mr. Hugh Jenkins), to whose speeches we listen as part of our acceptance of a great national project.
    Mr. Price: I would prefer not to answer that question off the cuff. If the right hon. Gentleman wishes to put down a Question, I shall give him a full answer.
    Mr. Michael McNair-Wilsonasked the Minister of Aviation Supply how much financial assistance has been given to date to the British Aircraft Corporation and to Rolls-Royce Limited to cover the development costs of Concorde; and what is now the estimated total cost of the project.
    Mr. David Price: Expenditue to date at B.A.C. amounts to approximately £150 million, and at Rolls-Royce to about £120 million. The estimate of development cost is one of the questions that my right hon. Friend will be discussing with his French opposite number, M. Chamant, during the coming review of the project.
    Mr. McNair-Wilson: Could the Minister say at what stage B.A.C. takes over the production financing of Concorde? Will the corporation be buying the Olympus 593 engine directly from Rolls-Royce or from the Government? Could my hon. Friend say whether the Government intend to give any financial assistance for production financing?
    Mr. Price: The first and third supplementary questions put by my hon. Friend will be very much matters to be discussed in the review. On the second part of the
    1702
    question, I do not think that it matters now which way it is done since at present the whole project is fully funded by the Government.
    Later—
    Mr. Hugh Jenkins: On a point of order, Mr. Speaker. In view of the unsatisfactory replies which have been given from the Government Front Bench and the inadequate comment from the Opposition Front Bench on the subject of Concorde, I beg leave to give notice that I shall seek to raise the matter on the Adjournment.

    European Aerospace Industry
    Mr. Carterasked the Minister of Aviation Supply if he has initiated discussions with his Continental counterparts with a view to establishing a European aerospace industry.
    Mr. Corfield: I think we must accept that further action on the initiative referred to in my statement to the House on 2nd December, 1970, must wait until the Rolls-Royce situation is clearer.—[Vol. 807, c. 1286–94.]
    Mr. Carter: While thanking the hon. Gentleman for that reply, may I ask whether he will not agree that Britain by itself can no longer afford to support an aircraft industry which locks up one-third of all our research and development costs in one year and one-third of all our highly skilled manpower? Will he not agree that the only way Britain can play its rightful part in the aircraft industry in the world is within a European framework?
    Mr. Corfield: Yes. I do not think I dissent from anything the hon. Member has said.

  HOUSE OF COMMONS

    Blind Persons and Guide Dogs
    Mr. Hardyasked the Lord President of the Council if he will arrange for blind persons to be allowed normal access to the Central Lobby when accompanied by guide dogs.
    The Lord President of the Council and Leader of the House of Commons (Mr. William Whitelaw): This is a question which has been gone into carefully on a

    1703
    number of occasions. In so complex a building it has been found better for the blind person to be personally escorted to wherever he or she wishes to go. I can assure the hon. Member that the dogs are very well cared for.
    Mr. Hardy: While I accept that the present arrangements appear to be extremely satisfactory and possibly admirable during the busier periods, would not it be possible for access to be allowed to the Central Lobby in quieter times? Is the right hon. Gentleman aware that these dogs are exceptionally well-trained and that any concession allowed in this building would have an encouraging effect in the country?
    Mr. Whitelaw: This matter can be looked into. As I think the hon. Gentleman appreciates, the views of the public relations officer and the director of training of the Guide Dogs for the Blind Organisation have been sought. Both of them believe that our present procedure is the best. However, we are perfectly prepared to look at it again if necessary.

    Members' Interests
    Mr. William Hamiltonasked the Lord President of the Council when he intends to table resolutions concerning the Select Committee's report on Members' outside financial interests.
    Mr. Whitelaw: I have nothing to add to what I told the hon. Member on 10th February.—[Vol. 811, c. 522.]
    Mr. Hamilton: I am not surprised at that. Why is the right hon. Gentleman so coy in seeking to sweep under the carpet the implications and recommendations contained in this report? Does not he recognise that, in view of the fact that the Government are about to introduce commercial radio when we know that there are vested interests concerned with that on the benches opposite, proposing to sell off State pubs to private brewers who are also represented by interests on the benches opposite, and proposing to hive off certain profitable parts of the State-owned industries in which a number of hon. Gentlemen opposite are interested, it is increasingly important for the public to understand what those interests are?
    Mr. Whitelaw: I do not accept all the premises of the hon. Gentleman's supple-
    1704
    mentary question. Having considered this matter very carefully, I think that there is widespread support in this House for the view that it is right to rely on the general good sense of hon. Members rather than on formalised rules. That is certainly the view of the Official Opposition, and I believe that it is the view of many right hon. and hon. Members.

    Parliamentary Constituencies (Advice Centres)
    Mr. William Hamiltonasked the Lord President of the Council whether he will examine the feasibility of providing in every parliamentary constituency a publicly-financed and staffed advice centre for the use of the Member of Parliament and local councillors.
    Mr. Whitelaw: I have no evidence to suggest that such an expenditure of public funds would be justified.
    Mr. Hamilton: Does not the right hon. Gentleman recognise that the Government said that they intended to operate a system of open, honest government, in which the people would be encouraged to participate? Would it not be a great improvement on the existing situation if the Government provided such facilities in every constituency so that, in a situation like we have today with the Post Office strike, members of the public could have ready access to their Members of Parliament without having to rely on private expenditure by the Members of Parliament or their local constituency parties?
    Mr. Whitelaw: In the first instance, naturally, anything to do with the facilities of local councillors is not a matter for this House. As for the hon. Gentleman's other points, I do not think, from my own knowledge, that many right hon. and hon. Members are slow in offering all the advice that they can to their constituents.
    Sir R. Thompson: Is my right hon. Friend aware that a large number of hon. Members on both sides of the House have provided this kind of service for years and will neither need nor welcome the intervention of a horde of bureaucrats to help them?
    Mr. Whitelaw: I am interested and glad to hear what my hon. Friend says.

    Members' Salaries (Review Body)
    Sir G. Nabarroasked the Lord President of the Council whether he will now make a further statement on the review body for pay, pensions, conditions and associated matters for Members of Parliament.
    Mr. Whitelaw: I have nothing to add to the answers I gave my hon. Friend on 20th January and 11th February in reply to his Questions about the setting up of the review body.—[Vol. 809, c. 1067; Vol. 811, c. 805.]
    Sir G. Nabarro: Is my right hon. Friend aware that on 11th February—
    Mr. Speaker: Order. The hon. Gentleman must not rise until I call him. Sir Gerald Nabarro.
    Sir G. Nabarro: The noise was so great that I could not hear, Mr. Speaker. I thought that you had called me. I apologise. I will start again. Is my right hon. Friend aware that on 11 th February in answer to a similar Question, my right hon. Friend passed the buck to my right hon. Friend the Prime Minister, whereupon I tabled a Question to the Prime Minister, who passed the buck back to my right hon. Friend? There is a limit to the patience of hon. Members who, like myself, have been trying to press this matter now for over two years since the right hon. Member for Blackburn (Mrs. Castle) made her first announcement of a review body. It is about time that my right hon. Friend stirred his shanks and gave us a satisfactory answer, which I shall certainly press for, even to the extent of raising the matter on the Adjournment.
    Mr. Whitelaw: There is only one comment that I would make in the first instance. Whether I like it or not, I seem to have been stirring my shanks quite a lot in recent days. Apart from that, to take the question seriously, which I do—
    Mr. Dan Jones: Yes, indeed.
    Mr. Whitelaw: —I am very anxious that, from the point of view of Ministers' and Members' salaries, this review body should be set up at the very earliest opportunity. My responsibility relates especially to my promise that Ministers'
    1706
    and Members' salaries would be referred to it as soon as it was set up. However, there are other problems concerned with setting it up. I can promise that it will be set up as soon as possible. As soon as it is, I will undertake to fulfil the promise that I made to this House. I regret that I have not been able to do so sooner.
    Mr. Loughlin: Is the right hon. Gentleman aware that most of us are very grateful for that assurance? Having had experience as a junior Minister, I can assure him that junior Ministers have a particularly acute problem. Apart from that, I want to impress upon him that there are hon. Members on this side of the House who, unlike me, have families, and are now facing a really serious financial position. May I ask the right hon. Gentleman to say not merely that he will do it as soon as he can, but that he will look at the possibility of speeding up the process?
    Mr. Whitelaw: I am extremely sensitive to the problems and of my responsibility to this House in respect of Ministers' and Members' salaries. I am doing everything in my power to hasten the setting up of the review body. As soon as it is set up, this reference will be made to it.

    Refreshment Department
    Mr. Speaker: Mr. Arthur Lewis. Next Question. Sausages—[Laughter.]
    Mr. Arthur Lewisasked the Lord President of the Council what brand of sausage is sold in the Members' Cafeteria; on what basis he charges Members 7s. 6d. per lb for these sausages; and whether he will change his purchases to one of the retailers, details of which have been supplied to him, who are able to supply sausages at 4s. 4d. per lb to 4s. 8d. per lb and reduce the price charged in the Members' Tea Room.
    Dr. Bennett: I have been asked to reply.
    I doubt if this is a matter of wide public interest. I will write to the hon. Member with any details that he requires.
    Mr. Lewis: That is a most unsatisfactory reply. I have been trying to get proof from the Kitchen Committee, but have failed, that prices have gone up

    1707
    300 to 400 per cent. since Members of Parliament last had an increase. As the Leader of the House seems reluctant to get action going speedily on the salary question, may I ask whether he or the Government will at least take steps to control the prices charged by the Catering Department? For prices to go up 300 or 400 per cent. when country Members have no other place to eat is surely something which the Kitchen Committee could deal with. It is not the case with the Civil Service canteens. Their prices have not gone up 300 or 400 per cent.
    Dr. Bennett: I assure the hon. Gentleman that I shall be very glad to place at his disposal all the figures of the costings and selling prices which he may desire. I also assure him that the facts are not quite so alarming as they appear to be from the allegations which he has made.

    QUESTION No.36 (SUPPLEMENTARY QUESTION)
    Sir Harmar Nicholls: On a point of order. May I ask you, Mr. Speaker, to give special attention, when the OFFICIAL REPORT is printed tomorrow, to the supplementary question put by the hon. Member for Fife, West (Mr. William Hamilton) on Question No. 36. I think you will find that it contains a filthy innuendo which is damaging to Parliament if allowed to stand unanswered. The hon. Gentleman stated specifically in his supplementary question that hon. Members on one side of the House, on matters to do with commercial radio and the sale of licensed premises—[Interruption.] The hon. Gentleman's supplementary question contained the specific charge that hon. Members on one side of the House would do less than their duty because of their own selfish interests. I think it will be found that the words were specific and obscene enough to have the matter investigated by a Select Committee of this House.
    Mr. William Hamilton: I hope that no steps will be taken by anyone to delete a single word which I used in the course of that supplementary question. I suggest that the best way to resolve the matter would be to have a debate on the recommendations of the Select Committee looking into the outside financial interests of hon. Members of this House.
    1708
    I challenge the Leader of the House, through you, Mr. Speaker. to arrange for a debate on that report.
    Mr. Speaker: I am inclined to agree in part with the hon. Member for Fife, West (Mr. William Hamilton). These are not matters of order. They are matters for debate.
    Sir Harmar Nicholls: On a point of order. I put a specific request to the Chair—
    Mr. Speaker: Order. I have ruled that no matter of order arises.
    Sir Harmar Nicholls: Further to that point of order.
    Mr. Speaker: Is the hon. Gentleman-seeking to pursue the same point of order?
    Sir Harmar Nicholls: Yes.
    Mr. Speaker: I have ruled that no matter of order arises.
    Sir Harmar Nicholls rose—
    Hon. Members: Sit down.
    Mr. Speaker: Order. I have called the hon. Member for Gloucestershire, West (Mr. Loughlin).

COMMITTEE OF PRIVILEGES (REPORT)
Mr. Loughlin: I apologise to you, Mr. Speaker, and to the House in raising this point, because I wish to seek your guidance.
I want to raise a matter relating to the Second Report of the Committee of Privileges which involved an alleged assault on a doorkeeper in this House. It will be in the recollection of the House that, during a whole series of Divisions, I raised this point. The Committee sat and in the evidence which was submitted reference was made to myself as the person who had raise the whole matter. My right hon. Friend the Member for Lanark (Mrs. Hart) was also referred to as a potential witness, as well as my hon. Friend the Member for West Ham, North (Mr. Arthur Lewis). There are certain implications in some of the questions which were put at the hearing which could be construed as a criticism of me.
Mr. Speaker: Order. I apologise for interrupting the hon. Gentleman, but this cannot possible be a point of order for me. This is an expression of opinion about a report which the House may have a chance to debate. If need be, the hon. Gentleman could table a Motion dealing with the matter to which he is referring. However, the contents of the report cannot possibly be a matter for the Chair.
Mr. Loughlin: Further to that point of order. What I wanted to seek your guidance upon, Mr. Speaker—I did not want to spread it out too much—was the point that the Committee proceeding and the report were a negation of all the procedures of this House. I appreciate that I can raise the matter with the Leader of the House, but I wanted your guidance as to how I could ensure that there would be a debate on this report.
Mr. Speaker: My predecessor made some very wise remarks about the duty or the lack of duty of the Chair to give guidance. It is no part of the duty of the Chair to give guidance. The hon. Gentleman has certain means, under Standing Orders, by which he can raise this matter. There can be no question of a point of order for the Chair now.

POST OFFICE (DISPUTE)
Mrs. Castleasked the Secretary of State for Employment whether he will make a statement on what further efforts he has made to resolve the deadlock in the postal workers dispute.
The Secretary of State for Employment (Mr. Robert Carr): As the House will know, I yesterday met, at their request, representatives of the U.P.W. who put forward proposals which they asked me to convey to the Post Office. I did so, and, on my suggestion, the two sides later met under my chairmanship and agreed to resume discussions today. These discussions began just before lunch, and when I had to leave my Department they were still in progress. In the circumstances, the House will understand that I am unable to say anything further at this moment. I therefore ask the House not to press me to do so.
Mrs. Castle: Is the right hon. Gentleman aware that we welcome, as I am sure the whole country will welcome, the initiative which the union has once again taken to try to find a basis for the settlement of this dispute? As long as constructive and meaningful talks are going on, of course we would not wish to press the right hon. Gentleman for details.
First, may I ask whether the right hon. Gentleman will make a statement to the House tomorrow; and, secondly, whether he personally will dedicate himself to seeing that this time the talks, so important to the country, do not break down?
Mr. Carr: I have had to stop dedicating myself to this matter for a short time to come to answer this Question. I make no complaint about that. I assure the right hon. Lady that I shall return, just as soon as I can, to continue dedicating myself to bring these talks to a successful conclusion.
I ask the House at this juncture not to try to apportion praise or blame, initiative or lack of initiative, to either party.
Mr. David Steel: May I ask the right hon. Gentleman and his colleagues to refrain, now or in future, from using the figure of £25 as the average pay of postmen, hearing in mind that in many parts of the country, including my constituency of Roxburgh, Selkirk and Peebles, there is no opportunity for overtime, and, therefore, this figure is entirely misleading.
Mr. Carr: Averages are averages and must be used if we are talking about them.
Mr. Charles R. Morris: Hon. Members on both sides and the nation will hope that the negotiations lead to an acceptable conclusion to the strike, which has now extended over 43 days. The Post Office has lost revenue to the extent of £27 million and more than 7 million Post Office staff working days have been lost. Against that background, does the right hon. Gentleman accept that it is a matter of growing concern that the dispute should be brought to an acceptable end? Will he also bear in mind that in the discussions one of the important factors is to re-establish relationships

1711
between the management of the Post Office and that section of the staff represented by the U.P.W.?
Hon. Members: Too long.
Mr. Morris: Will the Secretary of State further accept that a step in the right direction will be a moratorium on statements and declarations on the dispute by his Minister of State, the Minister of Posts and Telecommunications and of Posts and Telecommunications, and the Chancellor of the Exchequer?
Mr. Carr: I share the hon. Gentleman's hope that the discussions will lead to the end of the dispute. I think that those who ask for moratoria should observe them.
Mrs. Castle: Will the right hon. Gentleman undertake to make a statement to the House tomorrow?
Mr. Carr: I beg the right hon. Lady's pardon for forgetting that part of her question. I will certainly make a statement at the earliest possible moment, and I hope that that may be tomorrow.

BILL PRESENTED

  CRIMINAL JUSTICE (AMENDMENT)
  Mr. Edward Lyons, supported by Mr. Michael Havers, Mr. Edward Gardner, Mr. Alexander W. Lyon, Mr. Arthur Davidson, Mr. Peter Archer, Mr. Ivor Richard, Mr. Elystan Morgan, Mr. Norman Miscampbell, Miss Mary Holt and Mr. Clinton Davis, presented a Bill to amend the law in relation to the powers of courts in respect of young offenders by repealing section 3 of the Criminal Justice Act 1961:
  And the same was read the First time; and ordered to be read a Second time upon Friday, 12th March; and to be printed [Bill 125].

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

  SUNDAY ENTERTAINMENTS
  3.42 p.m.
  Mr. John Parker: I beg to move,
  That leave be given to bring in a Bill to amend the law relating to public entertainments on Sundays.
  This is a limited Bill. It is not a Sunday trading Bill, and it excludes Scotland and Northern Ireland, which have their own laws on the subject.
  Similar Bills passed through Committee three times in the last Parliament, in 1967 through the House of Lords and in 1968 and 1969 through the House of Commons. It failed to become law because of a filibuster against it, in 1968 on Report and in 1969 at the Committee stage. In 1969 60 hours and 19 Sittings were spent on the Bill before it finally went through Committee. It got through substantially as it started despite the filibuster.
  In moving the Bill, I am seeking the views of the new House. There are over 150 new Members, largely younger Members of a new generation. I hope that they will feel that this is a worthy Bill that they can support.
  The House of Commons is behind public opinion on this matter. The latest Gallup Poll of adults over the age of 16 showed 64 per cent. of people in England in favour of the Bill, and 62 per cent. in Wales. Of those between 16 and 24, 82 per cent. were for it; of those between 25 and 44, 71 per cent., and of those between 45 and 64, 59 per cent. Only in the older age group of those over 65 was a majority against the Bill.
  The case for the Bill is that the present law is a complete mess. It is based very largely on the 1780 Act, with various exceptions for concerts and, in many areas of the country, for cinemas. The 1780 Act is enforced sporadically and sometimes abused, being got round through subterfuges of one kind or another.
  The vital Clause is that providing that people may not pay for entry to an entertainment on Sunday. That is illegal under the 1780 Act, but the law is got round in many ways, and by many reputable organisations. For example, county cricket has been saved by Sunday play. The law is got round by having payments

  1713
  for programmes or parking. The same is true of Rugby League and polo.
  Motor racing at Brands Hatch on Sundays was ruled illegal in a test case brought by the Lord's Day Observance Society against the organisation running it. By dropping payment for entry and introducing parking fees the organisation has been able to continue its activity.
  Theatre performances are illegal on Sunday. Many people think it rather ridiculous that we can see a live play on television on a Sunday but cannot see it in a theatre. But theatre clubs can be created, and members can there see a live performance on Sundays.
  The proposed change in the law is backed by all the major sports organisations, including the Football Association, the Football League, the British Amateur Athletics Board, the M.C.C., the Rugby League Authorities, the R.A.C. and many other bodies. Rugby Union games are now being played in Sundays.
  There is no proposal that theatres should be open seven days a week. If they gave performances on Sunday they would close on Monday or another day. The younger actors and actresses are almost universally in favour of such a change, as are most of the stalwarts of the theatre, like Dame Sybil Thorndike and Dame Edith Evans. They believe that in the interests of the theatre it should be possible to give performances on Sunday, when an audience is more likely to be available.
  The noise argument has been one of the main obstacles to passing such a Bill. There is a fear that noise would be connected with Sunday football. To meet that point the Home Office drew up a Clause to meet the wishes of local authorities and magistrates, which would enable objection to be taken by people living in the neighbourhood of a sports stadium to noise on Sundays, and for action to be taken to regulate Sunday activities or prevent them at a particular stadium. It is most unlikely that first-class football would be played by the same club on both Saturdays and Sundays. Local circumstances would determine whether it played on Saturday or Sunday in any area.
  The Bill is in no sense anti-religious. It is backed by leaders of most of the responsible religious organisations, which
  Vol. 812
  1714
  dislike the present hypocritical position. They feel that the present law brings law enforcement into disrepute and that it is much better to alter it and bring it into line with popular feeling than, to have subterfuges to get round it.
  The only serious opposition comes from a fanatical Sabbatarian organisation, which is very well-organised and is one of the best pressure groups in the House, the Lord's Day Observance Society and its friends. Its members have every right to whatever views they like on how to spend their Sunday, but no right to force their views on the rest of us who do not agree with them.
  In this year of grace, given that we have people in this country of all religious views and none, the right thing to do is to have a law in accord with what the majority think, a law which allows people to choose for themselves how to spend their Sundays.
  I therefore ask the House to support the Bill, to enable every one of our people to choose for themselves how they will spend their Sundays.
  3.42 p.m.
  Mr. Ron Lewis: I oppose the Motion. Over the years my hon. Friend the Member for Dagenham (Mr. Parker) has been consistent in his desire to extend the provision of Sunday entertainment, but so far without success.
  Let me make it perfectly clear that I am in no way associated with the Lord's Day Observance Society. My only connection with it is that, like other hon. Members, I receive its circulars from time to time, and many of them land up in the wastepaper basket.
  Neither am I speaking for any body of Church opinion, though it is safe to say that the majority of religious denominations in Britain are violently opposed to my hon. Friend's Bill. I hope that hon. Members who believe and feel as I do will demonstrate their opposition to the Measure in the Lobby.
  The laws governing Sunday observance have two distinct aims. The first, and most important, is to protect the distinctive character of the day—of Sunday as opposed to the other days of the week. The second is the need to defend the worker's day of rest.

  1715
  A campaign for an extension of the present laws has been going on in certain quarters, particularly in the Press. Hon. Members who dare oppose the Bill will no doubt be labelled killjoys and branded sarcastically as "do-gooders" who are seeking to curtail the pleasures of others. But we should be prepared to defend Sunday against further secularisation and commercialisation from a patriotic sense of duty as the trustees of posterity.
  If by our actions we pass on to the next generation a de-Christianised Sunday, they will pass on a de-Christianised Britain. It will be easier for us and them to defend Sunday with religion behind it than it will be for our children to defend religion without Sunday on which to practise it.
  The Church, which seeks to retain Sunday, is composed of people and not merely institutions run by parsons, important though they are. I am not, in my opposition to the Bill, simply advocating that people should go to church on Sunday, though if more did and if more children went to Sunday school we might have fewer people in the courts.
  One day of the week should be set aside from the rest, and that should be Sunday, the Sabbath day, with its restful quietude. It is a valuable asset. If this extension of Sunday entertainments is approved, the peace and quiet of Sunday will be disturbed in most towns and cities and this will be greatly resented, particularly by those who live in the vicinity of sporting events.
  Most hon. Members will be aware that in my constituency we have the most progressive football team of the last five years. I support it whenever I can. I cannot be certain, but I do not think it would be the wish of the directors of that team to upset the peace and quiet of the neighbourhood and antagonise many of my constituents by an extension of sporting facilities on Sundays.
  It is becoming almost immoral nowadays to talk about moral problems. I believe that my hon. Friend's proposals raise certain moral issues. For example, a nation which seeks to neglect its Sabbath responsibilities of rest and worship for commercial ventures is travelling along the road to seeming disaster.
  In the last few years we have seen an extension of what is now known as the permissive society. A great many people in these islands, irrespective of politics, religion and creed, are becoming restive about moral values and standards. Like me, they believe that an extension of Sunday entertainments would not help us in any way.
  I plead with hon. Members to accept that Sunday is a precious heritage of immense value. Let us value it to the full by seeking to retain the character of the day. If I am able to get a Teller to stand with me. I shall divide the House.
  Question put, pursuant to Standing Order No.13 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of Public Business):—
  The House divided: Ayes 113, Noes 116.

  Division No. 226.]

  AYES

  [3.56 p.m.

  Allason, James (Hemel Hempstead)

  Delargy, H. J.

  Griffiths, Will (Exchange)

  Allaun, Frank (Salford, E.)

  Dell, Rt. Hn. Edmund

  Grimond, Rt. Hn. J.

  Allen, Scholefield

  Doig, Peter

  Hamilton, William (Fife, W.)

  Archer, Jeffrey (Louth)

  Douglas-Mann, Bruce

  Harper, Joseph

  Bagier, Gordon A. T.

  Driberg, Tom

  Haselhurst, Alan

  Balniel, Lord

  Duffy, A. E. P.

  Healey, Rt. Hn. Denis

  Blenkinsop, Arthur

  Dykes, Hugh

  Heffer, Eric S.

  Bottomley, Rt. Hn. Arthur

  Edwards, Nicholas (Pembroke)

  Houghton, Rt. Hn. Douglas

  Brocklebank-Fowler, Christopher

  English, Michael

  Howell, Denis (Small Heath)

  Brown, Ronald (Shoreditch & F'bury)

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

  Huckfield, Leslie

  Carmichael, Neil

  Fitch, Alan (Wigan)

  Hughes, Robert (Aberdeen, N.)

  Chapman, Sydney

  Fletcher, Raymond (Ilkeston)

  Hunt, John

  Clark, David (Colne Valley)

  Fletcher, Ted (Darlington)

  Irvine,Rt.Hn.SirArthur(Edge Hill)

  Cocks, Michael (Bristol, S.)

  Foley, Maurice

  James, David

  Coombs, Derek

  Foot, Michael

  Jenkins, Rt. Hn. Roy (Stechford)

  Cooper, A. E.

  Ford, Ben

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

  Crawshaw, Richard

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

  Johnson, Walter (Derby, S.)

  Cronin, John

  Fraser, John (Norwood)

  Judd, Frank

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

  Garrett, W. E.

  Kinnock, Neil

  Dalyell, Tam

  Gilbert, Dr. John

  Kinsey, J. R.

  Davies, G. Elfed (Rhondda, E.)

  Ginsburg, David

  Lamond, James

  Davis, Clinton (Hackney, C.)

  Grant, George (Morpeth)

  Latham, Arthur

  Deakins, Eric

  Grant, John D. (Islington, E.)

  Lestor, Miss Joan

  Lewis, Arthur (W. Ham N.)

  Murray, R. K.

  Skinner, Dennis

  Lipton, Marcus

  Oram, Bert

  Spriggs, Leslie

  Lyons, Edward (Bradford, E.)

  Orbach, Maurice

  Stewart, Rt. Hn. Michael (Fulham)

  Mabon, Dr. J. Dickson

  Orme, Stanley

  Strang, Gavin

  McCartney, Hugh

  Paget, R. T.

  Strauss, Rt. Hn. G. R.

  McCrindle, R. A.

  Palmer, Arthur

  Taverne, Dick

  McGuire, Michael

  Parkinson, Cecil (Enfield, W.)

  Torney, Tom

  McMillan, Tom (Glasgow, C.)

  Pavitt, Laurie

  Varley, Eric G.

  McNamara, J. Kevin

  Peart, Rt. Hn. Fred

  Vickers, Dame Joan

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

  Prescott, John

  Wallace, George

  Marks, Kenneth

  Rodgers, William (Stockton-on-Tees)

  Watkins, David

  Meacher, Michael

  Rost, Peter

  Whitehead, Phillip

  Mellish, Rt. Hn. Robert

  Sheldon, Robert (Ashton-under-Lyne)

  Mendelson, John

  Silkin, Hn. S. C. (Dulwich)

  TELLERS FOR THE AYES:

  Morris, Alfred (Wythenshawe)

  Sillars, James

  Mr. John Parker and

  Mulley, Rt. Hn. Frederick

  Silverman, Julius

  Mr. Dick Leonard.

  NOES

  Archer, Peter (Rowley Regis)

  Hiley, Joseph

  Page, John (Harrow, W.)

  Bell, Ronald

  Hughes, Rt. Hn. Cledwyn (Anglesey)

  Pardoe, John

  Benyon, W.

  Hutchison, Michael Clark

  Percival, Ian

  Bidwell, Sydney

  Jennings, J. C. (Burton)

  Pike, Miss Mervyn

  Biggs-Davison, John

  Jessel, Toby

  Pink, R. Bonner

  Booth, Albert

  John, Brynmor

  Pounder, Rafton

  Boscawen, Robert

  Jones, Arthur (Northants, S.)

  Powell, Rt. Hn. J. Enoch

  Boyd-Carpenter, Rt. Hn. John

  Jones, Gwynoro (Carmarthen)

  Price, J. T. (Westhoughton)

  Braine, Bernard

  Kellett, Mrs. Elaine

  Probert, Arthur

  Bray, Ronald

  Kilfedder, James

  Ramsden, Rt. Hn. James

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

  Knight, Mrs. Jill

  Reed, Laurance (Bolton, E.)

  Brown, Sir Edward (Bath)

  Lane, David

  Renton, Rt. Hn. Sir David

  Burden, F. A.

  Legge-Bourke, Sir Harry

  Rhodes, Geoffrey

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

  Lewis, Kenneth (Rutland)

  Rhys Williams, Sir Brandon

  Chichester-Clark, R.

  Loughlin, Charles

  Roberts, Albert (Normanton)

  Clark, William (Surrey, E.)

  Lyon, Alexander W. (York)

  Roberts,Rt.Hn.Goronwy(Caernarvon)

  Cohen, Stanley

  McAdden, Sir Stephen

  Roberts, Wyn (Conway)

  Coleman, Donald

  McBride, Neil

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

  Cordle, John

  Maginnis, John E.

  Sandys, Rt. Hn. D.

  Costain, A. P.

  Marten, Neil

  Soref, Harold

  Davies, Denzil (Llanelly)

  Mather, Carol

  Stewart, Donald (Western Isles)

  Davies, Ifor (Gower)

  Mawby, Ray

  Stoddart-Scott, Col. Sir M.

  Davies, S. O. (Merthyr Tydvil)

  Mills, Peter (Torrington)

  Summerskill, Hn. Dr. Shirley

  Dempsey, James

  Mills, Stratton (Belfast, N.)

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

  Dodds-Parker, Douglas

  Milne, Edward (Blyth)

  Temple, John M.

  Edwards, William (Merioneth)

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

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

  Elliot, Capt. Walter (Carshalton)

  Moate, Roger

  Tinn, James

  Evans, Fred

  Molyneaux, James

  Trew, Peter

  Eyre, Reginald

  Money, Ernie

  Turton, Rt. Hn. R. H.

  Farr, John

  Monro, Hector

  Urwin, T. W.

  Ferryhough, Rt. Hn. E.

  Morgan-Giles, Rear-Adm.

  Waddington, David

  Galbraith, Hn. T. G.

  Morris, Charles R. (Openshaw)

  Wainwright, Edwin

  Galpern, Sir Myer

  Morris, Rt. Hn. John (Aberavon)

  Wall, Patrick

  Gibson-Watt, David

  Mudd, David

  Ward, Dame Irene

  Glyn, Dr. Alan

  Murton, Oscar

  Wells, John (Maidstone)

  Gray, Hamish

  Nabarro, Sir Gerald

  Wolrige-Gordon, Patrick

  Gurden, Harold

  Normanton, Tom

  Hamilton, Michael (Salisbury)

  Orr, Capt. L. P. S.

  TELLERS FOR THE NOES:

  Hardy, Peter

  Oswald, Thomas

  Mr. Ron Lewis and

  Harrison, Col, Sir Harwood (Eye)

  Owen, Idris (Stockport, N.)

  Mr. Simon Mahon.

  ORDERS OF THE DAY
    SUPPLY
    [11TH ALLOTTED DAY],—considered
    SUPPLY

      SOUTH AFRICA (SALE OF ARMS)
      Mr. Speaker: Before I call the right hon. Member for Huyton (Mr. Harold Wilson) to move his Motion, I would inform the House that I have selected the Amendment standing in the name of the Prime Minister and his right hon. Friends. I would also inform the House that I know of many right hon. and hon. Gentleman who wish to speak in this debate. Therefore, I hope that all who catch my eye will make reasonably brief speeches.
      4.4 p.m.
      Mr. Harold Wilson: I beg to move,
      That this House regrets the decision of Her Majesty's Government to authorise the sale of further Wasp helicopters to South Africa, which has caused jubilation among the supporters of apartheid and has jeopardised the Eight Power Commonwealth Study Group on the Indian Ocean; and calls on Her Majesty's Government to demonstrate that this is not the thin end of the wedge by announcing that it will supply no arms to South Africa excepting those it is legally obliged to supply.
      This Motion is in two parts. The first refers to the Government's announcement of their intentions to supply Westland Wasp helicopters to the South African Government—helicopters which they claim. on the basis of the opinion of their own Law Officers, they are legally required to supply under the terms of the Simonstown Agreement. We do not accept this argument. We were not so advised, and, as I understand it, the Government have themselves made it clear that they are not standing any longer on legal obligations.
      The Prime Minister—this has been repeated by the Foreign Secretary—clearly and deliberately told the House that they would give no undertaking to limit their arms supplies to the very restricted range set out in the Law Officers' White Paper, whatever their Amendment, which I think adds to the confusion, may I say. Our position is clear. We oppose
      1720
      arms sales to South Africa. We stopped arms sales to South Africa. We shall do so again.
      Today's debate is not about Law Officers' opinions, although I recognise that different lawyers may, with absolute honesty, take different views about the interpretation of the Simonstown Agreement. But there is a further point. If the House traces back the whole history of the Prime Minister's personal commitment on this question, hon. Members will find that the whole question of legal obligation has been rather in the nature of a vehicle, an afterthought indeed, which he has used to try to justify a decision which he had previously taken on the most dubious of political grounds.
      That decision, which they took and which they made public within three days of forming the Government, was simply, of course, a product of this new style of obsessional government, based mainly on commitments made under Right-wing pressure when they were in Opposition. The decision which they took after becoming the Government was based on a determination to carry out at any rate this pledge in their manifesto, although we have not always noticed quite the same obsessive determination to carry out other pledges—namely, those on which they won the election—[An HON. MEMBER: "You should know.") Yes, we know, and the housewife knows too.
      The House last debated these issues on 22nd July. If it is a fact that we have not, as an Opposition, pressed the Government on this in all these months in parliamentary debate, it was because we still hoped that, as a result of the Commonwealth consultations on which they belatedly embarked after taking a decision and as a result of a further assessment of the damage which their policy would create, they might change direction. Unhappily this has not proved to be the case.
      From November onwards, the right hon. Gentleman has tried to justify a policy decision taken on other grounds by reference to the putative obligation which he claimed to have found in the Simonstown Treaty. In his Guildhall speech, the Prime Minister went so far as to claim that we—that is Britain—have an obligation to supply to South Africa
      "…the maritime equipment she requires to fulfil her side of the agreement."

      1721
      This is a very wide definition of the obligation, but the implication of that has, of course, been cut right down to size on the Law Officers' opinion which was set out in the White Paper.
      I now turn to the decision announced by the Foreign and Commonwealth Secretary on 22nd February to supply an unstated number of the Wasp helicopters which were referred to in the Law Officers' White Paper. I have made it clear that we do not agree about the obligation which the Law Officers have claimed to detect. With regard to these allegedly outstanding helicopters, we did not supply them, we would not have supplied them. I repeat—on the advice which we had and the policy which we followed, we would not have supplied them, we would have adhered to the decision which we took on coming into office in October, 1964, which was in fulfilment of the decision of the Security Council of the United Nations. Even if the House were to accept the Government's interpretation of the legal requirements—and the Government's Amendment, which I understand the Foreign Secretary is to move, seems to limit their South African arms policy just to the Westland helicopters—there is still a vital issue of timing in the supply of the helicopters which I think many of our Commonwealth partners will regard as a breach of faith.
      I accept the Prime Minister's statement to the House that he reserved his position on timing and made no commitment to await the report of the Commonwealth Indian Ocean Working Party. He has told that to the House, and we accept it. But there have been suggestions in the Commonwealth that they understood differently and that they heard him say it. While not disputing the reservation he made, they assumed that he would not invoke it but would at least await completion of the Study Group's task. The Government announced their decision less than a month after the Singapore Conference. They did not wait even for the South African shopping list to materialise but anticipated it in their announcement.
      But that is not all. Even if the House is prepared to accept the Government's right—or obligation, if hon. Members put it that way—in accordance with the
      1722
      Law Officers' opinion, to supply helicopters, I must point out the situation we have reached compared with what right hon. and hon. Members opposite used to say on these matters. In the debates in the last Parliament and in the country we were treated to descriptions of a glittering Eldorado of arms orders from South Africa—£100 million, £200 million, £300 million. Now it all comes down to an order of rather less than £1 million on which to wreck the Commonwealth and cause all this dispute.
      The Prime Minister at least will not deny that this is what the Government when they were in Opposition held out as the prospect for South African arms sales. He will not deny the figures of £100 million and £200 million because, in a debate under Standing Order No.9 in December 1967, he himself quoted a figure of £200 million as the gain to this country for selling the pass on arms to South Africa. Now he is defending his glittering prize of less than £1 million. He has been prepared to disrupt the Commonwealth, to wreck the Commonwealth Conference and to stain our image in the world—because that is what he has done—all for that £1 million order for helicopters, which are to come from a production line which has ceased production and will have to be started up again. Perhaps in 1973 and 1974, if the supply has not been stopped in the interval, we shall see the trade returns showing another £1 million as an offset of the returns which will be lost on all the other trade we do with other Commonwealth nations. No one outside the Treasury Bench thinks that these helicopters will strike terror into the hearts of the Soviet Naval High Command. So much for them.
      The second part of our Motion deals with arms supplies going beyond the Law Officers' narrow list. I am glad to see that the Law Officers do not accept that there is any obligation under the Simonstown Agreement to supply any arms beyond these Wasps—none at all. But that is not what the right hon. Gentleman implied in Canada, nor what he said at Guildhall last November, when he told his audience, referring to the Simonstown Agreement:
      "Under these arrangements we have an obligation to supply to South Africa the maritime equipment she requires to fulfil her side of the Agreement."

      1723
      Was that meant to be rather less than £1 million for helicopters? If so, why did the right hon. Gentleman not say so to the Guildhall audience? They would have cheered him. Does he still maintain what he said then—that there is a legal obligation going beyond the helicopters? He referred in Canada to a legal obligation. He used the phrase, "required under the Agreement". If that did not mean legal requirement, I do not know what he meant. If it is what he meant, then he has been repudiated by his own Law Officers because paragrah 59 of their eminent publication reads:
      "In our opinion it would not be reasonable, in these circumstances, to imput to the parties an intention to include a term in the Sea Routes Agreement which would place any general and continuing legal obligation on Her Majesty's Government to permit the supply of arms to the South African Government."
      Does the right hon. Gentleman accept that? Perhaps before I finish he will stand on his own two feet and tell us. No doubt we shall learn a great deal because, if he does accept that opinion, two things follows.
      The first is that an intention to supply other arms is a political decision of grave implications and falsifying the claims on which this was related to legal requirements. Secondly, it follows that the right hon. Gentleman is prepared to subordinate a United Nations decision which, it is at least arguable—and no doubt will be argued by lawyers—overrides bilateral treaties, not to the requirements of a bilateral treaty but to a stubborn policy decision. The two sides of the House may disagree about the helicopters. I would have hoped that that would not be so and that even those who have studied the White Paper would still feel that the right hon. Gentleman has created further difficulties for the Commonwealth by announcing the decision before the Indian Ocean Working Party has even got down to the job. But whatever disagreement we have about the helicopters, it is basically the arms outside the categories set aside in the White Paper on the ipse dixit of the Attorney-General that the Motion parts company with the Government and the Prime Minister. That is the second part of the Motion.
      1724
      The Government Amendment is quite extraordinary in that it refers only to arms covered by the Law Officers' opinion as being required under the Simonstown Agreement. I do not claim that we should shorten the debate, because many right hon. and hon. Members feel strongly about this matter, but we could certainly face a different situation if the right hon. Gentleman would get up now and tell us that the Amendment, asking for the support of the House for supplying helicopters—the White Paper arms, as one might call them—means that nothing will be supplied beyond the helicopters. If he were to say that—and that must be the implication of this mealy-mouthed Amendment—I readily concede that that would be a welcome change in the Government's posture.
      But if the Government intend to go beyond the White Paper arms there is a still more fundamental split in the House—a split as deep and fundamental as the split which the right hon. Gentleman has, with his divisive obsession, created within the Commonwealth. I want to deal with the moral stance adopted by the right hon. Gentleman and what it means for our standing in the world. I do not question his good faith when he expresses his aversion to apartheid. That is not in question in the debate. But there is an ancient legal doctrine which asserts that any individual must be presumed to intend the necessary consequences of his actions.
      Last autumn, I said that South Africa's keenness to place an arms order in Britain was not so much related to its desire or need for arms as to get from Britain a certificate of respectability. I believe that the same argument has been used by a number of Commonwealth Heads of Government. Is this what the right hon. Gentleman really wants? Is that what his supporters really want? That is how it has been interpreted since the announcement of the Foreign Secretary in South Africa. There has been some difficulty in this country in getting the South African newspapers. I have made some efforts. But we have the reports, and I believe honest reports, in the British Press of what the South African newspapers were saying. The Daily Express headline was
      "South Africa Cheers `Hero' Heath".

      1725
      Hon. Members have seen the other extracts in the British Press. The Economist, summarising South African Press reactions last weekend, said that they regarded the arms announcement as
      "…a symbol of the country's acceptability as a military and diplomatic partner"—
      of the right hon. Gentleman. It cites Die Burger—if I pronounce it rightly—which
      "…switched from its normally conservative typographical style to greet the news with a huge banner of two-inch headlines announcing boldly 'Arms ban is lifted', with a large picture of Edward Heath in the centre of the page."
      Mr. William Hamilton: Grinning.
      Mr. Wilson: My hon. Friend, unusually, is wrong. The right hon. Gentleman was not grinning really. It was that Central Office picture showing him as a man of integrity.
      Last week the right hon. Gentleman celebrated 21 years in this House, and his constituency entertained him. When he came to the House as an idealistic young Conservative, did he really think that he was going to be the hero of apartheid South Africa?
      At any rate, the first response of the South African Government, basking in their new respectability, was to order a security service swoop on the homes of Christian ministers of religion in a search for seditious and disruptive documents—presumably the New Testament. On Saturday we had the testimony of an Anglican clergyman, the Rev. Colin Davidson, summarily ordered out of the country last week by Dr. Vorster after Dr. Vorster's validation by this Government. The Daily Telegraph reported him as saying on arrival in Britain that the Government's decision gave
      "…massive support to a white racialist regime."
      This clergyman was reported as saying
      "This decision gives the South African Cabinet a sense of achievement and power…. They are saying that world opinion is coming round their way, and they see this as proof that what they were saying is right."
      This encourages the Nationalist government to move much more firmly against its critics, particularly those in the churches. Are right hon. Gentlemen opposite proud of that achievement?
      1726
      Again, I quote the Daily Telegraph report of this clergyman's words:
      "The system is so evil it has the seeds of its own destruction in it."
      I ask whether any right hon. Gentleman would really stand up and say that he rejects the assertion that the South African system of apartheid is essentially evil. And if it is evil, can any hon. Gentleman support a decision which, throughout white South Africa and, above all, in the newspapers which support that system of evil, has been hailed as endorsing what they are doing there?
      There is no hon. Gentleman in any part of the House who was not revolted by Sharpeville, and certainly right hon. Gentlemen opposite, and equally my right hon. Friends, opposed it. But can they be proud that those in South Africa who defended Sharpeville are the ones who are cheering the right hon. Gentleman now?
      I wonder whether the Government have seriously considered what an assertion to supply arms to South Africa—beyond the Law Officers' list—must mean to Britain's standing abroad, for our image—to use that over-worked word. For one thing, it means that in every issue, issue after issue that comes up at the United Nations, Britain, the British vote, and the British representative will be corralled, humiliatingly confined, in a small minority—colonialist oppressive Portugal, South Africa, and Britain—hardly any more, on deep issues of international morality. Is that what hon. Gentlemen opposite want? It is what they will be voting for tonight. [An HON. MEMBER: "What about the French?"] The French usually abstain on these issues, as a matter of fact. But if hon. Gentlemen want to defend the French shipments of arms, they will no doubt have the right hon. Gentleman on their side. For our part, we protested at this.
      The Minister of State for Foreign and Commonwealth Affairs (Mr. Joseph Godber): When?
      Mr. Wilson: In June, 1967, in the Petit Trianon in Versailles, when I raised it myself with General de Gaulle.
      The right hon. Gentleman who, 1 gather, will reply to the debate, when the right hon. Gentleman the Prime

      1727
      Minister should be replying, now has several hours in which to look that up before he speaks tonight. It was in 1967.
      It means more than the United Nations question. It means that in bilateral discussions with the leaders of other countries, the right hon. Gentleman is hog-tied by the decision which he has taken. Months ago a newspaper cartoon depicted the right hon. Gentleman with the South African albatross around his neck. My hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) said in a different context a fortnight ago that it was not the only albatross with which he had burdened himself. But the nature of a man with an albatross round his neck, as we know from Samuel Taylor Coleridge, is not only that he becomes a bearer of burdens, but he also becomes a bore. Everyone he meets, nearly every speech he makes, reflects his burden.
      "It is an ancient mariner,
      And he stoppeth one of three…."
      Everywhere he went at the time he took his decision, all the comments and all the discussions were dominated by his South Africa obsession. It was not one of three that he treated to this obsession; it was the lot. He negotiated with the President of the United States; all the time this was the centre of world comment. At the United Nations, with Canada, with visiting Commonwealth statesmen—there was nothing to talk about except this. All the time there were urgent and pressing British interests, urgent bilateral questions, urgent international and Commonwealth problems, which could not be pressed on Britain's behalf, because the albatross dominated each and every conversation.
      The danger of an obsession of this kind in foreign policy is that other countries can play on it. They can ask the obsessional country for its support or its refusal to press a national interest in return for support for acquiescence in the subject of the obsession.
      For the right hon. Gentleman, South African policy became what the Hallstein doctrine became for the German Government in the late 'fifties and early 'sixties. It had to be traded. It was the subject of pressures, even blackmail, though at least the Germans could claim that a vital issue of principle was involved with the Hallstein doctrine. Not so the right hon.
      1728
      Gentleman on the subject of arms to South Africa.
      The right hon. Gentleman will say that there is more at stake here than the moral or Commonwealth issue. He will say that there are military arguments, the freedom of the seas around the Cape, British trading and economic interests. Do they seriously argue that we have to supply arms to South Africa to maintain the freedom of the seas? If that is so, why have they failed to persuade the principal maritime nations of the world, Scandinavia, Western Europe, and the United States? If the Soviet threat to the Indian Ocean threatens world and British freedom, could not the right hon. Gentleman, with all his eloquence and persuasion, have convinced the Pentagon? The Pentagon is not difficult to convince where Soviet threats are said to operate.
      There has been a reference to the closure of the canal in June, 1967. But from June, 1967, to December, 1969—the House has been told this—35,000 ships have rounded the Cape. Only 3,000 were British. Are the national Governments responsible for the remaining 32,000 regardless of the danger which the right hon. Gentleman sees? Do they agree with him about the need to maintain the freedom of the seas?
      We hear oil mentioned many times in this context. The House will have seen the words of Sir David Barran, Chairman of Shell, who was reported on 16th November last as saying that he was "rather indifferent" to having two or three British frigates floating around in the Indian Ocean. He said:
      "The flow of oil in tankers round the Cape of Good Hope is not threatened by a Russian presence there."
      The right hon. Gentleman is obviously not looking at a peace-time situation, he is looking at the dangers of war or he would not be doing all these extraordinary things. Supposing war were to come, involving a Russian naval presence. Is the right hon. Gentleman convinced after the attitudes struck in the Second World War that Dr. Vorster, a self-confessed adherent of Hitler, would be the reliable ally of Britain on whom the right hon. Gentleman would feel it right to stake his all and the all of Britain too?
      Mr. John Biggs-Davison: I am grateful to the right hon. Gentleman

      1729
      for giving way. On the moral case that he is making and on the strategic case, does he really think that it was right for the Administration of which he was the head to hold joint naval exercises with the South African Government, having regard to what he has just said about Dr. Verwoerd as a reliable partner?
      Mr. Wilson: Dr. Verwoerd and Dr. Vorster? Yes, Sir. We fulfilled the terms of the Simonstown Agreement but we did not stretch those terms to supply arms—[Interruption.]—which were not required and which right hon. Gentlemen only want to supply because of pressures from Right-wing members of the party such as the hon. Gentleman.
      I ask the right hon. Gentleman, is it not simply the fact that if the Soviet armed strength were to challenge the West, including Britain, the United States and Western Europe, in thermo-nuclear conflict, this threat would have to be met, not in the Indian Ocean on a localised basis, but worldwide and by the whole of the armoury of the West, not three or four frigates, with or without the Law Officers' helicopters?
      Defence today in a global way must be collective, it must be global not "go it alone" still less "go it with racialist South Africa". If the motive is fear of Communism in the area, and this is the argument we have been asked to accept, then the House must look at it in a different dimension, the dimension of land and not sea. Before October, 1967, the Foreign Secretary, as Prime Minister, regularly warned the House of the dangers of Communist political penetration of Africa. Some of us were not fully persuaded then as he was, but later I learned how seriously these warnings should be taken.
      Why then does he not draw the lesson from his own warnings? He may agree that the problem is not the danger of Soviet penetration of Africa countries or the danger of Chinese penetration of African countries, it is the danger of competition between Soviet and Chinese penetration because competition intensifies effort, for good or ill. All competition escalates, Communist competition escalates absolutely. The whole House would like to see a combined operation between the Western world and the Communist world for developing the nations
      1730
      living in poverty, as a combined world war on poverty.
      But until conditions exist for that to become possible there is a struggle and this struggle is taking place every day in Africa. It is a struggle for the whole of Africa and Asia and other areas of the developing world, a struggle between the contributions which Britain has led, over successive Governments, for a democratic post-imperialist world, against a Communist theory. This is a world interest but it is also a hard-headed British interest too. British arms to South Africa are in this respect calculated to play into the Communists hands.
      This is the defence argument, if it is defence we are debating. What does it profit a man—or a government—to gain control, through three or four helicopters of a few more square miles of the Indian Ocean—it is no more than that—and to lose the battle for hundreds of millions of hearts and minds on the continents washed by the ocean? I say nothing today—even in the context of hardheaded British national interests—of our economic interests, trade and investments which right hon. Gentlemen are apparently willing to set at risk. Our trade, our investment north of the Zambesi far transcends the totality of our economic interests south of the Zambesi. That must be known to right hon. Gentlemen opposite when they examine policy for South Africa or, as they may shortly be doing—and we shall be watching them on this—a policy in relation to Rhodesia.
      If hon. Gentlemen want to know the figures for the first half of last year, the total imports from "white" Africa were £161·2 million and exports £178·8 million. Total "black" Africa imports were £232·7 million and exports £187·1 million. If we take all Arab and black Africa together, and these two go together, the imports total £342·5 million and exports £227·1 million as against exports for white Africa of £175·8 million. If we want more hard-headed argument about trade let us have all the figures from the Government.
      Equally, I ask not whether the right hon. Gentleman proposes to use his new acceptability south of the Limpopo to get an undertaking from the South Africans that they will withdraw their police and other forces which are illegally deployed

      1731
      in support of an illegal régime in Rhodesia. I do not propose to do that because I regret the very basis on which he has won that acceptability. The right hon. Gentleman will know that even Mr. Smith told me that he did not want South African security forces in Rhodesia. The right hon. Gentleman as a result of his activities in South Africa is getting mixed up in some pretty ugly company, with some pretty ugly projects.
      But if the right hon. Gentleman, converted as he has long been to the harsh doctrines of cost benefit analysis, assertive as he claims of the requirements of British national interests, would submit his South African arms policy to the rigours of such analysis then in terms of hard cash, trade, investments, British economic interests he would secure an answer which demands a reversal of the policies with which he has become identified.
      Having asked the right hon. Gentleman if he will do this cost benefit analysis of his policy, because he obviously has not done so as he would only get one answer, I want to put to him a wider issue of British interest, of world interest. I want to ask him to look at this question in terms of history. What in his view does Britain stand for? If British policy and British standards in world affairs have meant anything right since the days when Clem Attlee granted independence to India in 1947, they have meant that we have presented to the newly-emerging independent world a doctrine, a philosophy, a way if life which could he set against the appeals of the Communist philosophy, be it Soviet or Maoist.
      That philosophy was our belief in democracy as a living and moral alternative. This was true in 1947–51, following independence in India, Pakistan, Burma and Ceylon; it was true in 1951–64; it was true in Mr. Macmillan's "wind of change" Government which was cheered at by hon. Members opposite. It was true in 1964–70. Successive Prime Ministers, six in all over 25 years of British and world history, have recognised, as I believe the majority of this House has always recognised—at any rate until today—that in the world struggle for ideas and ideals we are concerned in a fight for the soul of Africa and Asia and of new peoples in other parts of the world.
      1732
      I hope the right hon. Gentleman would agree with this analysis. If he does not feel this to be a moral issue in his heart then it is impossible for me or any of us to seek to convince him. This is what it is.
      The House recognises the importance of the issues we are debating. I have distinguished between the limited arms supplies for which the Government, rightly or wrongly, claim legal validation, a legal requirement, and arms supplies which, on the Government own arguments, can carry no such legal support or legal obligation. It could be that the House is confused by the Amendment of which the Government have given notice. It may be that hon. Members will conclude from this that the Government ask for their support only for the helicopters covered in the White Paper because that is what the Amendment appears to say.
      I oppose and deplore the shipment of those helicopters; I hope that I have made that clear. I oppose all arms shipments to South Africa. I support, as I insisted on supporting by our action the day after we took office, the Security Council resolution of 1963. I support it in the terms in which it was moved, disregarding the unilateral interpretation which right hon. Members opposite sought to place upon it at that time. I hope that this is the purport of the Government's Amendment.
      We welcome the intervention of the right hon. and learned Gentleman the Attorney-General in the debate. We would welcome still more the intervention of the Prime Minister. It need take no more than a minute at any time between now and ten o'clock. The right hon. Gentleman is personally and obsessively responsible for what we are debating today. If he will get up and say that his Amendment means what it appears to mean—that Her Majesty's Government will give an undertaking that there will be no arms shipments beyond the helicopters referred to in the Amendment—he will have ended a desperately unhappy and totally unnecessary chapter in Britain's history of overseas relations. He will have done more: he will have created a more hopeful basis for the future of the Commonwealth.
      We are not concerned about the votes in the House or debating points. [HON. MEMBERS: "Oh."] We are prepared to

      1733
      let those go in order to get the right answer. We have not pressed this matter in the House for eight months when we could have had excellent votes and made debating points. We are concerned with the real economic and political interests of this country, of our standing in the world and the future of the Commonwealth which, with all its faults—and the right hon. Gentleman can see only the faults, apparently—is a microcosm of the world in which we live.
      What we are concerned with is the authority of a valid United Nations decision which neither the Government of the day nor any other Government proposed and which it is in British interests to support. Above all, we are concerned with ensuring that on the issue which transcends all others on the world stage—that of racialism and human rights and the dignity of our fellow human beings, regardless of colour, and of their freedom—the voice of Britain and the leadership of Britain is clear and understood throughout the nations of the world.
      4.44 p.m.
      The Secretary of State for Foreign and Commonwealth Affairs (Sir Alec Douglas-Home): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
      "endorses Her Majesty's Government's willingness to grant licences for the supply of arms to South Africa in accordance with our legal obligations in relation to the Simonstown Agreement, as set out in Command Paper No.4589".
      This debate was originally requested to discuss the statement which I made in the House on 22nd February and to hear from my right hon. and learned Friend the Attorney-General why he felt it right to advise Parliament that to supply the limited number of helicopters fitted to frigates built under the Simonstown Agreement for the South African navy was a legal obligation on the British Government. The Opposition Motion has, perfectly properly, widened the debate, but the Government Amendment brings it back to the matter under discussion—[Interruption.] I well remember the request that we should have a debate to discuss the Attorney-General's White Paper. I will reply to the Leader of the Opposition, but I am perfectly entitled to say that what we are discussing primarily is the recommendation—
      Mr. Denis Healeyrose—
      Sir Alec Douglas-Home: May I finish the sentence? I am entitled to say that the main topic which we are discussing this afternoon is whether there is a legal obligation to sell helicopters—[HON. MEMBERS: "No."]—and, if there is, should the British Government meet it?
      Mr. Healey: The House will recall that my request for a debate was in order to discuss the Foreign Secretary's statement on 22nd February. The right hon. Gentleman, in his statement, said that the Government reserved the right to sell arms to South Africa, irrespective of legal obligations, if they felt that it was in Britain's interests to do so. That is why we tabled a Motion in the terms of today's Motion, and that Motion is the subject of today's debate.
      Sir Alec Douglas-Home: The right hon. Gentleman and his hon. Friends need not get so excited. I said that the Leader of the Opposition had, perfectly rightly, raised a wider question, and I intend to answer it.
      When my right hon. and learned Friend the Attorney-General catches your eye, Mr. Deputy Speaker, as I hope he will, of course, he will explain the law. It is better that he should give the legal interpretation. I should, however, like to get one matter out of the way.
      It is within the recollection of the House that the Leader of the Opposition made an off-the-cuff accusation against me on 22nd February that I was guilty of something improper in that I implied that the Government had seen documents not available to the Law Officers of the last Administration or had access to opinions by them. The convention, as the right hon. Gentleman understands very well, is that Ministerial documents of one Administration are not made available to Ministers of the next. I am advised, however, that formal opinions by Law Officers are regarded as exceptions to this convention.
      In this case—and I am sure that the Leader of the Opposition will be glad to hear this—the question does not arise. I could not have said anything improper even if I had wished to do so because, strange as it may seem, there was no

      1735
      formal opinion given by my right hon. and learned Friend's predecessor on this very important legal question.
      Mr. Harold Wilson: I will accept anything that the right hon. Gentleman says on this matter—and I hope that he will come to the real issue about arms for South Africa in a moment. What he said on that occasion was that my right hon. and learned Friend the Member for West Ham, South (Sir Elwyn Jones) had not asked to see certain documents. If he said that, it was an improper thing to say. But, on the question of what he has just said, most modern Governments do not have to rely on written opinions. Most modern Governments, including I am sure his own when he was Prime Minister, invite Law Officers to the meetings of the Cabinet and Cabinet Committees to set out the position in law, and this we did.
      Sir Alec Douglas-Home: This is why no formal opinion was asked by the right hon. Gentleman of his right hon. and learned Friend. It is a very extraordinary thing, when South Africa was challenging the legal view of the Government of the day, that no formal opinion was in fact asked of the Law Officers at that time. The right hon. Gentleman the Leader of the Opposition cannot complain if I answer this point. He is very apt off the cuff, in a hectoring tone, to accuse various people of making improper statements. In this case my statement was perfectly proper. I could not have said, even if I had wished to say, anything improper on this matter because no formal opinion was given.
      As to the documents, official documents emanating from officials—and in my own Department this particularly applies to correspondence with representatives of foreign Powers—are, of course, available from one Administration to another. My right hon. and learned Friend will explain why in this case—this is very important to this argument—certain correspondence between Departments of the British Government and representatives of the South African Government were shown to him in circumstances from which he inferred that his predecessor had not seen that correspondence.
      Secondly, a point which the right hon. Gentleman made much of was the fact
      1736
      that he implied that there was a tacit understanding at the Prime Ministers' meeting in Singapore that no arms would be sold beforehand to South Africa, not even those for which there was a legal obligation, and he said that certain Commonwealth countries felt that to do this before the group had met could be described as a breach of faith. Those were his words. All right. I should just like him, if he will not take my word for it, to consider what was said by the Prime Minister of Australia in his Parliament and the Foreign Minister of Canada in his Parliament.
      On 22nd February, in the Ottawa Parliament, Mr. Sharp said:
      "I should add however that the British Government never did say it would withhold action on the sale of arms to South Africa, because of the formation of the Committee."
      Mr. Harold Wilson: I said that.
      Sir Alec Douglas-Home: The right hon. Gentleman's speech is very well within the recollection of the House.
      On 25th February the Prime Minister of Australia in the Australian Parliament said:
      "Everybody should be quite clear that the Committee was not set up to consider the question of the sale of arms to South Africa…At the time that it was set up, the British Prime Minister made it abundantly and unequivocally clear that the setting up of this Committee was quite satisfactory to him, but that he would be in no way inhibited as to the timing of any action he thought he should take in British interests"—
      Mr. Harold Wilson: I said that.
      Sir Alec Douglas-Home: The Prime Minister of Australia further said:
      "There was nobody who could have left that Conference under any misapprehension as to this."
      So there could not have been a breach of faith. What is more, the Prime Minister told his colleagues at the Prime Ministers' Conference what the legal obligation, as we understood it, was. So it was quite clear in all our minds that there was no question at the Singapore Conference, or following it, of a breach of faith in this respect. Therefore, this particular criticism can be dismissed.
      I hope that the Committee will meet. I think that it will be useful to all of us to survey the problems of security and of the interests of the countries around the Indian Ocean. We shall certainly do

      1737
      our best, if the Committee meets, to make a constructive contribution to it. I hope that that will happen.
      Mr. Healey: Nobody has ever disputed that the Foreign Secretary and the Prime Minister made it clear that they would not be bound in timing by the Agreement to hold the 8th February Conference, and, indeed, my right hon. Friend made that point. The point is that a number of Commonwealth Foreign Ministers, including Mr. Singh of India, also made it clear at the time that if this country took a decision on sale of arms before the group met, that would render its work unfructious, and the Government had full warning in Singapore from representatives of a number of Commonwealth Governments that they could not expect to have this Conference held if they took this decision now.
      Sir Alec Douglas-Home: The right hon. Gentleman was not at Singapore.
      Mr. Healey: They made it clear.
      Sir Alec Douglas-Home: They did not make this clear. What is so typical of the right hon. Gentleman is that he said he accepted the Prime Minister's word on what he said at Singapore and then he accepts it when somebody else says that there was a breach of faith.
      Mr. Harold Wilson: What I said was that I accepted that the Prime Minister said this. He told us in the House of Commons, and we accepted that fact, that he reserved his position and was not bound to defer an arms decision till after the Working Party had finished its work. He said that. [Interruption.] If hon. Gentlemen were not listening, those who can read can look it up in HANSARD tomorrow. I said that. I then said that some Commonwealth countries hoped that he would not press his reservation and I thought that they regarded it as a breach of faith.
      Sir Alec Douglas-Home: I hope that the right hon. Getleman, in fairness, will read HANSARD, because he used the words "breach of faith", and they will be in HANSARD tomorrow.
      So the Government believe in keeping their legal obligations. I trust that the Opposition do, too. If the Opposition do not believe in keeping their obligations, I hope that we shall know it.
      1738
      I turn to the Simonstown Agreement as a whole. This was raised by the right hon. Gentleman. The Simonstown Agreement was conceived in 1955 as a contribution to the defence of the sea routes leading to Britain and Western Europe. It was recognised by the Conservative Government of that day that the Cape area was an area of key strategic importance in the security of the seas. If it were important then, it is far more important now. Then, we were not nearly so dependent on oil; then, the Suez Canal was open. If the Simonstown Agreement was important then, it is far more important today.
      The strategic importance of Simonstown in the context of the possible expansion of hostile navies was, therefore, foreseen. It has nothing to do with apartheid, although apartheid at that time was practised. The Simonstown Agreement, incidentally, is one of the areas where there is a modification of apartheid. But the Simonstown Agreement is concerned with and exists solely in the context of the security of the sea routes. The Socialists, in Government, constantly underlined its importance in the context of defence. It is important in the context of defence, or nothing.
      On page 46 of the White Paper it is recorded that as late as March, 1970, the late Government were saying that the Agreement was important and was still in force, and presumably at that time they were carrying out legal obligations. The right hon. Member for Leeds, East (Mr. Healey) was even more effusive—as he is—and even more explicit. He interpreted Britain's rôle as one of shared responsibility with South Africa. He sent the British Navy on shared exercises, exercises in the context of the defence of the sea routes against possible hostile interference. But now he argues that there is none. What were the exercises for? He valued joint action, but when asked by the partner in the sharing for some tools to help to do the job of sharing, he said, "No. We will accept all the advantages of Simonstown. We will continue manoeuvres. You go and get your arms from somebody else on the side." That is not a very heroic posture for the right hon. Gentleman.
      The right hon. Gentleman, as I understand from his speeches and writings, now

      1739
      discounts any development of a threat in the future from an expanded Soviet Navy in the Indian Ocean. I hope he is right, but I am entitled to remind him that lately he was wrong—and in a very big way—about the Mediterranean. Only two years ago he told us that the Soviet naval presence was so insignificant in the Mediterranean that it could be sunk in a matter of minutes. He was right, but only for 18 months. Then there were ten fighting ships in the Mediterranean, now there are 40. Then there was no air cover for the Soviet Mediterranean Fleet; now that Fleet operates under the cover of Soviet bases on United Arab Republic soil. It is no use pretending that in the Mediterranean the balance of strength has not been dramatically changed by the expansion of the Soviet Navy in a remarkably short time.
      With great respect, the argument is not whether the Soviet Union, for example, on land in Europe will launch a direct attack on Germany, nor is it an argument whether the Soviet Union can be expected to sink the ships of the British Navy. The argument is this: if a Communist Power is left in monopoly of any area, then its purpose is to close the options one by one of the West and the free. That is the Soviet purpose.
      I will give one example which will illustrate to hon. Members what I mean. Only a few months ago, in the middle of the night, the Soviet Union said that they were going to close the Berlin air corridor. Action had to be taken. Action had to be co-ordinated, at a moment's notice, between the British Government, the United States Government and France in the middle of the night. The point is that, if an option like this is closed, the peaceful countries have to make a military response and are forced to do so by the actions of the Soviet Union. I deduce from this that we in this country should never put ourselves in the position—least of all on our main trade routes—in which we can operate only by somebody else's leave. That would be a terribly dangerous situation in which to put ourselves.
      Simonstown provides the services we need. The South African Navy is a useful reinforcement in the defence of the sea routes. The Motion asks the Govern-
      1740
      ment to pledge themselves never to sell any more arms beyond the terms of the Simonstown Agreement. My answer must be twofold. No Government, in the light of the expansion of the Soviet Navy, could sacrifice the Simonstown base, or risk doing so in any circumstances. Secondly, the British Government of the day must retain the right to judge what is necessary to keep that Agreement in good repair.
      The Leader of the Opposition has sought to take a moral stance on the sale of arms—
      Mr. Healeyrose—
      Sir Alec Douglas-Home: I cannot give way. Many back-benchers wish to speak. The Leader of the Opposition has sought to take a moral stance on the sale of arms. I am glad that he accepted that we on this side of the House are against apartheid—it would have been intolerably mentally arrogant of him had he not done so. I have tried to discover what moral principle he and his Government followed in relation to the Simonstown Agreement.
      Licences were granted by the previous Administration for a whole range of military equipment. Hon. Members will find some of it on page 43 of the White Paper. They sold, for example, 4·5 inch gun ammunition. What is the moral principle there? Westlands joined with the French company Sud-Aviation to manufacture 20 per cent. of the Puma troop carrying and assault helicopter. These helicopters are being supplied to the South African market. The right hon. Gentleman and his friends entered into an agreement with the French under which they had no right to object to sales to South Africa or any other country. What is the moral principle there?
      Mr. Healey: The right hon. Gentleman has just asked me a question; am I to be allowed to reply?
      Mr. Deputy Speaker (Sir Robert Grant-Ferris): When people ask questions they do not always expect an answer.
      Sir Alec Douglas-Home: The right hon. Gentleman and his Government held joint naval manœuvres with the South African Navy after Sharpeville. I was interested in the reply given by the right

      1741
      hon. Gentleman to my hon. Friend when asked why he did this. He said:
      "We kept the Simonstown Agreement."
      Exactly. That is all we are asking the Opposition to recognise.
      The right hon. Gentleman accuses us of selling arms which we are obliged to sell, if requested, to a South African Government with police in Rhodesia. So did they, and he knows it. I can find no moral principle in the right hon. Gentleman's policy. There is none, from start to finish. I can find only expediency writ large.
      As is the right hon. Gentleman's wont, he became very personal in relation to my right hon. Friend the Prime Minister, and the effect that he said the Prime Minister was having on the Commonwealth. Curiosity got the better of me, and I looked for a few things that President Kaunda and President Nyerere had said about the right hon. Gentleman. The House will no doubt be interested to hear them.
      President Kaunda in 1967 said:
      "I have reached a state of total disillusion with the Labour Party in Britain."
      On 5th October, 1967, he said:
      "They have deceived and cheated us all."
      President Nyerere on 15th December, 1967, said:
      "If Mr. Wilson—"
      [Interruption.] The right hon. Gentleman expects us to take what he says quietly when he accuses my right hon. Friend. He should listen to my reply. I will finish by quoting President Nyerere:
      "If Mr. Wilson has some ambition to be the British Prime Minister who broke the Commonwealth, I can regret it but cannot stop him fulfilling his ambition."
      Mr. Harold Wilson: If I said any unkind words about the Prime Minister, they were his words I was quoting, not what President Kaunda said. Will the right hon. Gentleman now agree that every one of those quotations by President Kaunda and President Nyerere was made because I refused to use military force in Rhodesia? Did the right hon. Gentleman at that time press me to use force there?
      Sir Alec Douglas-Home: If I recall aright, it was in relation to the statement by the then Prime Minister that the Rhodesia question would be settled in weeks, not months. The Conservative
      1742
      Government's policy has been consistent ever since the inception of the Simonstown Agreement. When a resolution was passed in the Security Council calling upon States to ban arms to South Africa—a resolution which the Opposition always forget to say is non-mandatory—the Conservative Government of the day explicitly reserved its right to sell arms for defence.
      Miss Joan Lestor: Before or after?
      Sir Alec Douglas-Home: Later we narrowed the definition to the defence of the sea routes. That is the context in which we intend to reserve our complete freedom of action. In face of a rapid expansion of the Soviet Navy into the oceans, it would be folly to sacrifice a base which offers security of tenure. The Opposition have widened the debate as they were entitled to do; they have widened the range of parliamentary discussion, as they are entitled to do. But the issue that is before us today, after the House has heard the learned Attorney-General, is to decide whether there is a legal requirement to sell to the South African Government helicopters and whether—
      Miss Lestor: On a point of order. Would it be in order to ask—
      Hon. Members: No.
      Mr. Deputy Speaker: Order. The only question the hon. Lady could ask would be on a point of order to me. She must not ask the right hon. Gentleman a question through me.
      Miss Lestor: On a point of order. In order that the House can be absolutely clear on what the right hon. Gentleman is saying, was the reservation on arms at the time—
      Mr. Deputy Speaker: Order. That cannot possibly be a point of order. Sir Alec Douglas-Home.
      Sir Alec Douglas-Home: I want to conclude by saying that of course the right hon. Gentleman is right when he says—
      Mr. Stanley Orme: Why does not the right hon. Gentleman talk to the Motion?
      Sir Alec Douglas-Home: —that apartheid is detestable and raises great moral issues concerning human rights. Of course that is true. We debated these matters at length in Singapore. There was not one single person at the Singapore conference who did not admit that our intention to fulfil our obligations under the Simonstown Agreement had nothing to do with racialism. They said that time and again to us. Nobody, even if the right hon. Gentleman will not accept it, has accused us of following a policy of racial bias.
      When we come to the Division this evening, my right hon. Friend who winds up the debate will ask the House to reject the Motion and to accept the Amendment, since we have a legal obligation to sell helicopters to South Africa and we mean to meet it.
      5.15 p.m.
      Mr. Jeremy Thorpe: In two respects the Foreign Secretary has followed paths of great wisdom in his speech. The first was to say that he would leave the legal argument to the Attorney-General, and he certainly practised what he preached by giving us no legal justification for the position which is being taken by Her Majesty's Government. Bearing in mind the exchanges in this House on 22nd February, to which I shall refer in a moment. when the right hon. Gentleman found himself in disagreement with the Law Officers, perhaps it is a good thing that the professional man on the spot should be given the last word.
      The second point was that he could find no moral principle involved in the debate. Having heard his speech, I entirely agree. Had I been in this House 35 years ago and had the noble Lord, Lord Dunglass then been at the Despatch Box, I would not have expected to have heard a very much different speech from that which the Foreign Secretary gave us today. [HON. MEMBERS: "Cheap."] As I shall seek to show, this policy will not be "cheap", but will be likely to be very expensive for the interests of this country.
      The right lion. Gentleman raised certain criticisms that had been made of the former Prime Minister by President Kaunda and President Nyerere. I would say in passing that I would rather be a
      1744
      white face in Zambia than a black face living in South Africa. [An HON. MEMBER: "Why does not the right hon. Gentleman go and live there?"] I do not live there because there is enough racialism to combat in this country with our immigration laws. Those two Presidents were making their criticisms against the then Labour Prime Minister for policies which were then backed by the Conservative Opposition. Therefore, the right hon. Gentleman's point was somewhat facile.
      Accepting all the qualifications entered into by the present Government in Singapore, it must be remembered that they turned down the Study Group which I put to the right hon. Gentleman the Prime Minister in November last. Fortunately, the Liberal Prime Minister in Canada put forward that suggestion and it was accepted in Singapore. It was nonetheless believed that we attached some importance to this Study Group and that would not jump the gun and take a decision. If the contrary was taken, why has Nigeria already announced that she is to withdraw? There is the proof.
      I believe, unlike the Foreign Secretary, that the present Prime Minister was right on 19th December, 1967, when we had a debate on the issue of South African arms following a Standing Order No.9 Motion. He then said that it was natural that in such an issue emotions should run high and that it was also right that a large part of our discussion should be devoted to questions of morality. But, notwithstanding the Foreign Secretary's speech, I hope that the Conservative Party will feel that morality plays as great a part in this issue as legality. If they do feel that, they will accord with the spirit in which the present Prime Minister spoke on behalf of the Official Opposition when we last debated this matter in 1967.
      I have been in the House for only 1l½ years but have been in politics for 23 years. With one exception in the last 15 years, namely 1956, there has been no political issue on which I personally have felt more passionately than on the issue of the supply of arms to South Africa. I shall say why in a few moments.
      Disregarding for a moment the merits of this issue, the way in which the present Government have handled the matter has

      1745
      breached every canon of good government for which they sought to castigate their predecessors. What happened? Within days, not weeks, of the election Dr. Muller presented himself at the Foreign Office, looking, as one correspondent said, like a thirsty man waiting for opening time. Without even giving the Cabinet an opportunity to discuss and consider the matter, the right hon. Gentleman the Foreign Secretary said, "You need not worry. Arms will be supplied." So much for instant Government.
      Then we got the Law Officers' opinion in the White Paper, in paragraph 59 of which we are asked to accept:
      "In our opinion, it would not be reasonable…to impute to the parties an intention to include a term in the Sea Routes Agreement which would place any general and continuing legal obligation on Her Majesty's Government to permit the supply of arms to the South African Government."
      The Government were asked on 22nd February whether they agreed with that view; were we merely talking of the limited category of arms within the Simonstown Agreement; did they accept their Law Officers' view? They were particularly reticent in giving any answer to the question, and they have been reticent today. So much for open Government.
      Then the Foreign Secretary was asked by the former Solicitor-General, the right hon. and learned Member for Liverpool, Edge Hill (Sir A. Irvine) on 22nd February:
      "Is the right hon. Gentleman aware that there will be general agreement on both sides of the House with the conclusion set out in paragraph 59 of the Law Officers' advice in the White Paper? Does he confirm that there is no general or continuing obligation to permit the sale of arms to South Africa?"
      The Foreign Secretary replied:
      "As I understand it, there is a legal obligation to do this, but surely that is a matter for debate rather than an exchange across the Floor of the House at Question time."—[OFFICIAL REPORT, 22nd February, 1971; Vol.812, c. 40.]
      So much for united Government. The Law Officers take one view. The Foreign Secretary, perhaps not at that stage modestly declaring his lack of legal knowledge, takes a contrary view.
      Then the Government who profess to abhor apartheid are doing the one thing that brings aid and comfort to the one régime which practises it. So much for double standards. Indeed, the Prime
      1746
      Minister, who says that the Government believe in freedom, travels the world in order to convince the world that the partners whom we need for the defence of the free world are those who practise one of the most oppressive régimes in the world. So much for the sincerity of their motives.
      However, on the issue of the Commonwealth, I believe that the present Foreign Secretary has at least on one occasion been entirely right. This must be an important statement of Tory policy because it appears in their manifesto for the last election. On 9th December, 1967, the right hon. Gentleman told the Royal Commonwealth Society:
      "I believe it would be a crime to throw away an essay in practical co-operation in which until now the Commonwealth has set an example. I profoundly hope that it will continue."
      So this co-operation took the form of the Commonwealth Study Group for the Security of the Indian Ocean. I accept straight away all the qualifications, including the rights which the Government said that they must retain. But I ask the right hon. Gentleman the question that I asked him the other day. Does he believe that it was really vital to take this decision, which will not bear fruition for 18 months, before the Commonwealth Study Group even met, let alone reported? Does he believe that that will strengthen or weaken the Commonwealth? I am asking him what the Prime Minister said. I accept that, with all its qualifications. But the mere fact that he and the Prime Minister carved out for this country certain rights of initiative does not mean that they have to take what many of us believe to be a wrong decision. So much for the value of their election pledges.
      What is an extraordinary thought is that the main naval power in the Indian Ocean is not South Africa. It is India, which happens to be a member of the Commonwealth. Might not it have been a good idea perhaps to have consulted the Indian Government first, and at least to have had one meeting of the Commonwealth Study Group, before this petulant decision of the Prime Minister was taken?
      What is perfectly plain is that, since the General Election, the Prime Minister has strained every nerve to justify the sale of arms to South Africa. He has

      1747
      sought to justify it on what has been constantly shifting ground. To start with, he talked about redressing the balance of power. One more pump from that argument, and the bicycle tyre would have burst. Then the right hon. Gentleman talked about the spirit of Simonstown. But his spiritual incantations were contradicted by the view of the 100 bishops of the Communion of which he is a member, and the theological arguments went. The next argument, we were told, was that this would contain Russian imperialism. The laughter in Washington and in Ottawa put that argument out of court—
      Mr. Orme: And in Moscow.
      Mr. Thorpe: Not only in Moscow but, I suspect, amongst the Chiefs of Staff here as well.
      The Government now say that they are falling back on our legal obligations. They cannot even tell us whether they are merely speaking of our legal obligations or whether they want to go very much further and supply more than we need supply under the Simonstown Agreement. So much for open and frank Government.
      The question which has been put repeatedly to the Treasury Bench is whether the limit of the Government's intentions is under Simonstown or whether they are Simonstown, plus an open-ended commitment. To that, there has been no reply, and this House, the country and the Commonwealth are entitled to an answer to that question. I believe that the Prime Minister said that we want frank questions and frank answers. We have not had them yet.
      So we fall back on our treaty obligations. The Prime Minister is perfectly right about treaty obligations as they affect the Commonwealth. I well remember 30th January, 1962, when he was asked by the then hon. and gallant Member for Arundel and Shoreham, the late Captain Kerby, why we had not gone to the armed assistance of Portugal with whom we had a treaty obligation, when Goa was invaded by India. He said that the then Foreign Secretary had made it quite clear that there was no question of a commitment of British arms or armies because we were not prepared on this issue to have a con-
      1748
      frontation with the Commonwealth. How right the right hon. Gentleman was. At that stage, he had his priorities right.
      So now the balance of power argument has gone, the argument about containing Russian imperialism has gone, the argument about the great defence of those few people who will defend the world has gone, and we fall back on the legal obligation, the one fig-leaf covering the Prime Minister's political inadequacy.
      The Prime Minister (Mr. Edward Heath): The right hon. Gentleman was kind enough to refer with a certain amount of praise to my speech on 19th December, 1967. In that speech, I set out all the arguments on which the then Opposition based their policy. Those arguments have remained throughout our years of Opposition. They were explained at the last election. They were put before the Singapore Commonwealth Conference in detail. They remain the same.
      Mr. Thorpe: I must concede straight away that, on the issue of South Africa, the Conservative Party has always been consistent. It is a long-established tradition which has been similarly applied not by the Prime Minister but by his Foreign Secretary to other régimes of a comparable nature in the 1930s. All that I was saying to the Prime Minister—and I repeat it in case he wishes to deny the point that he made—was that, when he opened the debate for the Opposition he said that, naturally, emotions would run high and that it was inevitable that a large part of the discussions would centre round questions of morality. Does he hold to the view expressed in that speech?
      The Prime Minister: I hold to that view. I was saying that, when the right hon. Gentleman concluded his speech by suggesting that there is now only one argument being used, which is the legal obligation set out in the White Paper, he could not be more wrong. All the arguments are set out in my speech. They were held throughout our years in opposition. They were held throughout the General Election, and they were explained to the Commonwealth Conference in Singapore.
      Mr. Thorpe: First, I have bad news for the Prime Minister. That was not the conclusion of my speech. There is

      1749
      very much more to come. Secondly, the Prime Minister cannot get away from this fact. The right hon. Gentleman was perhaps not listening with the attention which we might have hoped, to his own Foreign Secretary who was saying that we were legally obliged to supply arms. Perhaps the Prime Minister has not read the Amendment tabled by his own party.
      Therefore, I come back to the premise from which, I am afraid, the Prime Minister cannot shift. The Government are now justifying their policies in regard to the supply of anus to South Africa by saying that they are under a legal obligation to supply arms. Does the right hon. Gentleman deny that? His silence is eloquent.
      The Prime Minister: The right hon. Gentleman does not seem able to grasp this point. There are certain legal obligations which are sot out in the Attorney-General's White Paper. There are a considerable number of other arguments, many of which on the counter side have been put forward by the Leader of the Opposition today, others of which have been put forward by my right hon. Friend the Foreign Secretary and myself at Singapore. They are the same arguments which have been used since December, 1967. Does the right hon. Gentleman accept that these arguments have been consistently put forward right up to the time of Singapore, and that they are still valid?
      Mr. Thorpe: The Prime Minister cannot treat us as being as naive as the South African Government treat him. The Prime Minister has consistently shifted the grounds of his arguments until now he comes before this House and asks for approval of a legal document which he has asked his Law Officers to provide to show the legal basis on which the Government say that they must supply arms to South Africa. If the Prime Minister is now saying that there are moral grounds on which we have to supply arms, we should like to hear them. If the right hon. Gentleman is saying that this will redress the balance of power in the world and that President Nixon may be wrong—the Pentagon is not always right—then we should like to hear that.
      The argument put forward by the Foreign Secretary is that the Govern-
      1750
      ment's present action is because we are legally bound under a certain agreement to supply arms to South Africa. That is why we are debating the White Paper, which is a legal document.
      It is no good the Prime Minister shaking his head. He is not in the organ loft now. That is why the Government have moved their Amendment. It is no good the Prime Minister trying to get out of it. This is the basis on which the Government say that they are going to ship arms to a Fascist régime.
      Mr. Healey: I do not think that the right hon. Gentleman has fully taken the point that the Prime Minister and the Foreign Secretary have now overthrown the basis of the carefully constructed compromise reached in the Cabinet on which they hoped to get a unanimous vote tonight. They have widened the argument and are now asking the House to approve a policy defined in 1967 with the arguments attached to it. I hope that that will be noted by all hon. Gentlemen opposite who have consistently, to their honour, rejected those arguments in that policy.
      Mr. Thorpe: I am grateful to the right hon. Member for Leeds, East (Mr. Healey). I shall make two points on that and then leave it. If I have failed to convince the Prime Minister on this issue, then I must give up on it.
      The Amendment tabled by the Government
      "endorses Her Majesty's Government's willingness to grant licences for the supply of arms to South Africa in accordance with our legal obligations in relation to the Simonstown Agreement, as set out in Command Paper No.4589".
      Command Paper No.4589 talks about the legal obligations of Her Majesty's Government arising out of the Simonstown Agreement. If they cannot read, I give up hope even for this Government. That is what we are debating and that is the basis of their argument. Therefore, I ask what is the legal basis and whether it is binding on this country.
      It is no good the Prime Minister looking at his watch. If he has to go, he has to go. This is a debate which will affect—
      An Hon. Member: The Prime Minister has gone.
      Mr. Thorpe: For which relief, much thanks.
      This debate has divided the Commonwealth ever since this Government came into power. It has dominated the Singapore Conference and it has cast charges of bad faith on this country in the eyes of the world. Whether the Tory Government like it or not, it is a matter upon which many people in Africa and Asia and in this country feel profoundly and believe that the Government are wrong.
      The Simonstown Agreement—I hope that I have the agreement of the Attorney-General—is limited as to time. Initially it was from 1955 to 1963 regarding the supply of equipment. This was extended for technical reasons. It was limited as far as arms are concerned in its objective, to the expanion of the South African navy. I am talking simply and exclusively about arms. I am not talking about the relationship of the commander-in-chief or the purpose of the Agreement. I am talking merely about the supply of arms, because that is the issue in the debate.
      Under clause 7 it was limited as to its geographical extent. It was not for the defence of the Indian Ocean; it was for what was known in the Agreement as the South African area, which ended south of Mauritius.
      I believe that the last Labour Government cannot reconcile the Harrison letter of 9th March, 1965, which said that there would be additional helicopters provided without any qualification, with the Allen statement of 31st May, 1965, which said that there would be replacements as a result of accident, but not for wear and tear.
      Mr. Healey: He did not say that there would be. He said that they would be considered.
      Mr. Thorpe: I do not accept that those two views are reconcilable. That is a matter of opinion and I merely put mine forward.
      We have to rely for expectations on what the South Africans themselves were expecting. That is contained in page 9 of the White Paper. In January, 1967, they made a specific request for four helicopters. Those four helicopters were supplied by the previous Government. Therefore, the first question I ask is
      1752
      whether the Government accept paragraph 32 of the Law Officers' opinion, that in practical terms what is involved is
      "whether Her Majesty's Government is under any obligation to permit the supply of any further Wasp helicopters."
      I think that the Attorney-General was right. That is the issue for the Government. I want to know whether the right hon. and learned Gentleman is able to carry his Administration with him. The only legal issue is whether the Government are under an obligation to supply further Wasp helicopters. I hope that the Attorney-General is able to carry his Administration with him, but so far we have not heard.
      I hope that the right hon. and learned Gentleman is able to carry his Administration with him on paragraph 59, that there is
      "any general and continuing legal obligation on Her Majesty's Government to permit the supply of arms to the South African Government."
      But again we have so far had no reply.
      The Foreign Secretary—if I misquote him no doubt he will correct me—said that we would have to reserve our liberty of action. We want to know whether we are discussing the strict legal obligations under the Simonstown Agreement. Whilst I deplore that that Agreement was ever entered into, I concede that we are legally bound. If that is the end of the matter much of the bitterness and hostility and the misunderstanding can be at an end after this debate. But if the Government are saying, "No, we are going to reserve our position; we may want to supply very much more, perhaps in dribs and drabs. We are a great sovereign Power. We will not be interfered with. We must keep our national sovereignty", then, at the least, we shall not have a straight answer from the debate and, at the worst, I believe that there will be grave consequences in the Commonwealth.
      Then my criticism is that the White Paper is what I believe international lawyers would call a partial document; it does not take into account what international lawyers would regard as mutuality. If in one's relations with a foreign Power that foreign Power is in breach of its legal obligations, at the worst one is entitled to take reprisals and

      1753
      at best to look at all one's legal obligations. Under Article 7 of the United Nations Charter any resolution of the Security Council is mandatory. South Africa has not only breached mandatory obligations in regard to Rhodesia, which is a British Colony, but, has stated in paragraphs 287, 300 and 301 of the 1966 U.N. documents, that it does not intend to be bound by those mandatory obligations. So the South Africans are in international law in breach of their legal commitments to us.
      Let us consider Simonstown itself. I read the remarks of the British Ambassador which the Foreign and Commonwealth Secretary was kind enough to put in HANSARD on 22nd February. He did not answer many of the questions. For example, was the South African Evening Post wrong when on 25th February, 1968, it pointed out that Simonstown had been declared a white group area and that a coloured community of 1,200 had been ordered to move out of the area and go to Slang Kop 10 miles away, where there were no schools, no churches, no meeting halls, no roads and no accommodation? If that is the case, it is, to quote the Prime Minister's own theological phrase, "in breach of the spirit of Simonstown". Was the Archbishop of Capetown wrong when he said how much sympathy he had with the 4,000 coloured people who had been removed from the Simonstown area because it was a white group area?
      It is a strange doctrine that at the United Nations one votes for a resolution but does not necessarily—
      Rear-Admiral Morgan-Giles: On a point of order, Mr. Deputy Speaker. Before you took the Chair, Mr. Speaker requested that all speeches this afternoon should be short. It might assist the House if you would repeat that remark, because the right hon. Gentleman apparently did not hear.
      Mr. Deputy Speaker (Sir Robert Grant-Ferris): Order. That is not a point of order. Once an hon. Member has the Floor, provided he is not tediously repetitious, he can speak for as long as he remains in order. All that the Chair can do is to assert a wish that to get as many people into the debate as possible speeches shall be of a moderate length.
      Mr. Thorpe: There is very little more I wish to say, Mr. Deputy Speaker. I apologise to the House that we have been detained by the hon. and gallant Gentleman, who has prolonged my speech.
      I want to come to a legal argument, on which I know that I shall have the close attention of the Attorney-General and Solicitor-General. It is a strange concept that one can vote for a recommendation—not admittedly a mandatory resolution—and then have certain reservations so that one is not bound by it. That is a strange concept of international law, and it is not one shared by the Foreign and Commonwealth Secretary. On 5th July, 1950, there was a recommendation of the United Nations, for which we voted, to the effect that troops should be committed to Korea to deal with an act of armed aggression. The House decided that although that was only a recommendation we were bound by it because it was a recommendation for which we had voted. One of those in the Lobby on that date, as can be seen in Vol.477 of HANSARD, was Lord Dunglass. I believe that that was a view of international and political morality and legality which was wholly correct.
      Before the Government use their sophistry, saying that we can vote for a recommendation but not be bound by it if we have reservations, perhaps they will have regard to Article 103 of the U.N. Charter, which says:
      "In the event of a conflict between the obligations of the members of the United Nations under the present Charter and their obligations under any other international agreement, their obligations under the present Charter shall prevail."
      I have not seen any move by the Government to have that Charter amended, nor to give up their membership. The argument about Sir Patrick Dean's qualification in 1963, that we voted for the recommendation but said that we were not really bound by it, is just about as creditable as an hon. Member voting for an income tax proposal but saying that it does not apply to him if the Inland Revenue asks him to pay up.
      I believe that we are bound by that United Nations Resolution as members of the United Nations. I believe that South Africa has been in breach of international law in regard to this country on Rhodesia. Our commitment to the

      1755
      United Nations is binding, and the South Africans themselves are in breach of Simonstown. I further believe that our obligations were fully discharged by the supply of the four helicopters mentioned in the aide-memoire of 5th March, 1970. Therefore, we are entitled to know from the Government whether what we are being asked to vote for tonight is the strict legal obligations of Simonstown or for an open-ended commitment.
      It is no coincidence that the Prime Minister is the toast of Pretoria. Seldom has a British Prime Minister been more popular in South Africa since the war, because the right hon. Gentleman has given the seal of respectability to an evil and vicious régime which he himself is the first to criticise and deplore. The tragedy is that he and his Government have been so naïve as to be used by the South Africans for their own purposes.
      I have always believed that if there is a third world war—and, please God, there will not be—it will not be on the clash of ideologies, that it will not be capitalist versus Marxist. It will be on a clash of colour, the white faces opposed to the others, and it will be China that has stimulated that political polarisation.
      One of the great problems of the House has been the lack of understanding of feeling in Africa. It was because the former Prime Minister did not understand the mentality of the post-war immigrant to Rhodesia, and to a very large extent some of the immigrant population, that we had U.D.I., which could have been averted. It is because the present Prime Minister does not understand the passionate feeling in Africa that he has even contemplated renewing arms sales to South Africa.
      If you have a black face, Mr. Deputy Speaker—
      Mr. Sandys: He has not.
      Mr. Thorpe: Indeed, he has not, and what a disadvantage he would be under if he had and the right hon. Gentleman were in power!
      If you are a man with a black face and you belong to a Commonwealth nation you would find that the Commonwealth is one of the few organisations in the world in which people of every colour and every creed, from every continent,
      1756
      can sit down in relative trust and complete equality, but then you see the oldest, most senior member of that Commonwealth selling arms and underpinning a régime which believes that a man's status is determined from the second of his birth. That is much worse than Marxism, because it is the colour of the skin that determines the man's status. When the Government understand the feelings of such a man they will begin to realise why people in Africa and Asia feel so passionately about the matter, and why it is much more important than the Prime Minister's stubbornness and determination to show that he will not give in on a comma, because to do so would be thought an act of weakness.
      That is why this is a profoundly wrong decision. It will imperil the chances of the continuance of a multi-racial Commonwealth, which is one of the greatest influences for peace in the world. That is why I believe that the bitterness it will set off will imperil our investments and trade with black Africa and imperil our own nationals who live in many parts of Africa and Asia.
      That is why I say to the Government with all the passion I can summon that this is a profoundly wrong decision. It is wrong morally, it is wrong legally, and it is contrary to the best interests of this country.
      5.50 p.m.
      Mr. Sandys: I do not propose to follow the somewhat sanctimonious sermonising of the right hon. Member for Devon, North (Mr. Thorpe). The Leader of the Opposition also lectured us about moral principles and received a devastating reply from my right hon. Friend.
      In earlier debates I fully explained my views on South Africa's racial policy. All I wish to say today is that, in my opinion, ostracism is not the best way to bring about a change. I am glad, therefore, that several black African leaders are now advocating a dialogue with South Africa.
      I can summarise my views on the sale of arms in a few words. The most basic duty of any Government is to defend their people and vital interests against external attack. The responsibility for deciding what action is required to discharge that duty rests on the Government,

      1757
      and the Government alone. The Government cannot in any circumstances shift that responsibility on to the shoulders of any other authority, whether it be the United Nations or a Commonwealth Study Group.
      In the opinion of Her Majesty's Government—an opinion which I fully share—the supply of certain types of naval armaments could not conceivably affect to any appreciable extent the ability of the South African Government to maintain internal order. But even if the possession of these arms were to strengthen the hands of the South African Government in resisting opponents of apartheid, this would not absolve Her Majesty's Government of their basic duty to the British people.
      The Leader of the Opposition claimed that the sale of helicopters to South Africa would drive the black African countries into the arms of the Communists. Some have gone so far as to says that Tanzania and Kenya would retaliate by providing naval bases for the Russians. I just do not believe it.
      In the case of Tanzania, after the bitter experience of Zanzibar, where the Chinese have established virtual domination, President Nyerere is not likely to risk losing control of Tanganyika as well by offering the Russians a naval base at Dar-es-Salaam.
      As for Kenya, the Government of President Kenyatta have shown the most resolute opposition to Russian and Chinese penetration, which they recognise as a grave threat to their internal security. No amount of emotional feeling is likely to deflect them from this carefully considered policy.
      Then there is the threat of certain countries to withdraw from the Commonwealth. I have no more desire than any hon. Member to see a rift in the Commonwealth. But whether or not one believes those threats to be serious, we should not respond to that sort of pressure. If Her Majesty's Government once show that they can be forced to change their policy by the threat of resignation, the same tactics can be repeated on other occasions.
      Of course we fully understand the feelings and anxieties of the black African countries about apartheid, but they. too, should try to understand our
      1758
      feelings and anxieties about the growth of Soviet military power which threatens our very existence as a free nation.
      Whether or not we have legal obligations to supply arms to South Africa, Her Majesty's Government have an inescapable obligation to take whatever measures they consider necessary to protect the vital interests of the British people, and I hope that no pressure from the Opposition or elsewhere will deter them from doing their duty.
      5.56 p.m.
      Mr. Raphael Tuck: I wish to raise a point which I felt was important some time ago. As it has so far not been mentioned today, 1 was beginning to think that perhaps I was wrong. I will raise it nevertheless, particularly as Mr. Geoffrey Byng dealt with it recently in The Times. The right hon. Gentleman the Leader of the Liberal Party alluded to it in his speech, but did not bring it to its logical conclusion.
      The point in question refers to Article 103 of the United Nations Charter. It provides:
      "In the event of a conflict between the obligations of the Members of the United Nations under the present Charter and their obligations under any other international agreement, their obligations under the present Charter shall prevail."
      That means, of course, that if there is a United Nations obligation and an international one, the United Nations one takes precedence. Paragraph 3 of the Resolution of 7th August, 1963
      "Solemnly calls upon all States to cease forthwith the sale and shipment of arms, ammunition of all types and military vehicles to South Africa."
      That was accepted on 4th December, 1963, by Sir Patrick Dean, who said:
      "Because some way foward must be found we are therefore prepared to support the draft Resolution which has now been tabled by the representative of Norway. This entails our acceptance of paragraph 5"—
      I think he must have been referring to paragraph 3, because there was no paragraph 5—
      "of the draft Resolution which '… calls upon all States to cease forthwith the sale and shipment of equipment and materials for the manufacture and maintenance of arms and ammunition in South Africa'."
      Sir Alec Douglas-Home: Would the hon. Gentleman read on, to the reservation? Sir Patrick Dean was acting on

      1759
      the instructions of Her Majesty's Government. I trust that the hon. Gentleman will tell us that the resolution was non-mandatory.
      Mr. Tuck: The right hon. Gentleman has anticipated me. Certainly the resolution was non-mandatory, but it was accepted by the United Kingdom; and if a resolution is so accepted but is afterwards declared by the United Kingdom to be non-mandatory, then in my view that is sheer hypocrisy. In any event, it was non-mandatory only until we accepted it. Once we accepted it, we were in duty bound to honour it.
      Mr. Thorpe: Is it not a fact that we refused to vote for the resolution on Gibraltar because we were not prepared to be bound by its terms? We voted for this one, but surely there is no legal justification to vote for something and then say that it is not legally binding.
      Mr. Tuck: I am grateful to the right hon. Gentleman for that intervention.
      Mr. R. T. Paget: is my hon. Friend saying that any nation can unilaterally repudiate a treaty by voting for a non-mandatory United Nations resolution? That seems an extraordinary proposition.
      Mr. Tuck: I am saying nothing of the sort. I am merely pointing out that once we accept a United Nations resolution which is non-mandatory we are, having accepted it, in duty bound to honour it. This resolution was accepted by Sir Patrick Dean, no doubt on the instructions of the Foreign Secretary. The Foreign Secretary of that day was a man by the name of Lord Home, possibly a relation, but obviously a very distant relation, of the right hon. Gentleman who now occupies that position—[An HON. MEMBER: "Ha, ha, ha."] This is no laughing matter. Sir Patrick Dean went on to say that we would comply with it in the sense that no arms would be exported to South Africa from the United Kingdom which would enable the policy of apartheid to be enforced. First, this was a legally binding obligation, and if it conflicts with the international obligation under the Simonstown Agreement, assuming that there is an obligation to sell arms to South Africa under that Agreement, it must prevail and Simons-
      1760
      town becomes nullified and of no effect because of that superior obligation under the United Nations.
      Sir Patrick did go on to say that no arms would be exported to enable the policy of apartheid to be enforced. Is it really the Government's view that these helicopters will not enable apartheid to be enforced? Are they sincere when they say that the helicopters are necessary for the defence of our sea routes? Does the Prime Minister really believe that, if Russia were to launch an all-out offensive in the Indian Ocean, the presence of what the Russians might call these Lilliputian defences would deter them from doing so?
      What these helicopters are really being used for can be seen in Vietnam. The Vietnamese call them "gun ships". They are being used in large quantities to stem the advance by the North Vietnamese and to destroy them on the ground. They are being used internally and that is how they can and will be used by South Africa, if need be.
      South Africa is very afraid. She knows that she has trampled underfoot, beaten, whipped and shamed in every possible way her coloured population. She has tortured them at times and she is afraid of the day of retribution whenever it shall arrive. She wants these helicopters so as to be able to counter that retribution and destroy her internal enemies. She knows that she can use them internally. She is only afraid of retribution not from her own coloured population but also from the coloured states around her. That is why she wants these helicopters.
      The Government must know this. They must have the intelligence to appreciate this fact. Further, is the Prime Minister so lacking in intelligence that he does not realise that, if he persists in his aim and sells arms to South Africa, he will only be driving the coloured African states into the willing arms of the Communists? Is this really what he wants?
      As for the moral issue, we have the spectacle of the Prime Minister and his Government expressing horror and indignation at the way in which South Africa is treating her coloured population, but agreeing to sell her arms at the same time to condone her acts. I seem to remember a similar case in the 1930s, when a Conservative Government expressed horror

      1761
      and indignation at the way in which Hitler was treating the Jews, but lent him money and sold him arms at the same time—[An HON. MEMBER: "And Mussolini."] Yes, but mainly to Hitler.
      I told the Prime Minister a short while ago that he would go down in history as Robin Hood in reverse, because Robin Hood robbed the rich and gave their money to the poor, whereas he robs the poor and gives their money to the rich. I wish he were here in his place now, because I have something else to tell him. He and his Government will go down as the third Conservative Government in 32 years who have done their best to besmirch the name of Britain, to drag it in the mud and to make its citizens feel truly ashamed.
      The first such occasion was when Chamberlain waved that ridiculous piece of paper in our faces when he returned from Munich in 1938. That was an affront to the intelligence of every one of us. The second occasion was the Conservative Government's action over Suez, which was condemned by every nation of the civilised world. Finally, we have this contemptible and despicable action by the Prime Minister and his Government. I hope that the Prime Minister is proud of that record.
      6.5 p.m.
      The Attorney-General (Sir Peter Rawlinson): I would start by apologising to the House and to my hon. Friends for intervening at this stage, when perhaps some other of my hon. Friends might have caught your eye, Mr. Deputy Speaker. Nevertheless, it seemed important, considering the legal issues involved here, that I should intervene when other hon. Members will be able to follow, so that they may be able to debate the submissions which I shall make.
      I appreciate that this is a subject—we have just seen the evidence in the speech of the hon. Member for Watford (Mr. Raphael Tuck)—which involves emotional and political passion. However, I think that most hon. Members would agree that that is rarely the best state of mind in which coolly to review issues of law, which is the task that I have to carry out.
      It is essential for the proper consideration of the agreement, in order that the House, whatever it does over the matters
      1762
      of policy, can face up to the matters of law, to examine the purposes and objects of that agreement, to apply the rules of international law as to the interpretation of treaties, and in so doing to examine the practice of the parties to that agreement—mainly, Her Majesty's Government and the South African Government—and especially to examine the conduct of those parties towards that agreement in the years 1961 and 1963. Without that, it is impossible to assess the full implications of that agreement and to be able to establish, are there or are there not any legal obligations under international law?
      It would be impossible, in my view, for any lawyer to be able to give comprehensive advice without precise instructions about the practice of the parties in 1961 and 1963 in respect of the requirement and the conversion of the vessels to take a particular type of helicopter, designed for a particular anti-submarine rôle.
      Before turning to some of the legal arguments, I should like to assure the House, and in particular the former Attorney-General, that I have not improperly seen, or sought to see, our predecessors' papers. I am sure that he will take that from me. The normal convention would have permitted me to see any formal opinion given by our predecessors, as it gives me the right to look at prosecutions which have previously been instituted. It is obviously for better government that there should be that convention. The only papers that I saw of the previous Government were those papers published in the White Paper. There was, as my right hon. Friend the Foreign Secretary said, no formal opinion of the Law Officers of the Crown prior to this, and so I did not see any such.
      It seemed that all the documents which were placed before me by the Foreign and Commonwealth Office were presumably seen by my predecessors, but during the consideration of the legal problem, further material became available to me in circumstances which made it apparent that our predecessors may not have seen that material. That is the only comment which I should like to make on this matter.
      I should like now to turn to the White Paper and some of the legal arguments which have been addressed—
      Sir Elwyn Jones: Would the right hon. and learned Gentleman agree that the giving of a formal opinion has become a somewhat unusual experience now in the Law Officers' Department, and that more frequently opinions and advice are given by letter, and even more frequently orally in Cabinet or Cabinet committee?
      The Attorney-General: I accept that advice is given by letter and orally in Cabinet or Cabinet committee. But there is significance attached to a formal opinion by the Law Officers, because in such a case there are formal instructions and formal consultations with lawyers of the Department and, of course, a formal written opinion is submitted. There is significance in that the opinion of the Law Officers of the Crown is recorded and looked at thereafter, particularly if it relates to the interpretation of a treaty.
      I turn now to the argument which has been foreshadowed by the right hon. and learned Member for Devon, North (Mr. Thorpe) and by the hon. Member for Watford and which has also been advanced in the newspapers. It would seem to be the only argument which has been advanced questioning the advice which the Law Officers have tendered in this matter. It is that a non-mandatory Security Council resolution constitutes a treaty obligation, that any State which accepts it comes under an obligation to the United Nations, that therefore Article 103 applies, and that this United Nations obligation prevails over other treaty obligations.
      I suggest that this doctrine has never been accepted. It is a novel argument. I do not accept that it is correct in law. In any event, the United Kingdom made clear in the Security Council the extent to which it would define each resolution and the manner in which it was intending to apply it. It did not accept the recommendations in the resolution in this case so far as they concerned the supply of arms required by the Sea Routes Agreement. There was, therefore, no disguising of the position which the United Kingdom was adopting in these terms. The doctrine was not accepted by the last Government, who continued to supply spares and other equipment and ammuni-
      1764
      tion between 1964 and 1970, presumably because of the view they took of the obligations of the Simonstown Agreement.
      I notice that The Times, in its new style journalism, asserts that the Law Officers never examined that argument. I shall explain that non-mandatory Security Council recommendations under Chapter VI, as opposed to decisions under Chapter VII, have never been accepted as imposing legal obligations. As this argument has been advanced, however, I will deal with it in some detail.
      Chapter VI is headed, "Pacific Settlement of Disputes". Chapter VII is headed:
      "Action with Respect to Threats to the Peace, Breaches of the Peace, and Acts of Aggression".
      These are both parts of the functions of the Security Council. Chapter VI deals with non-mandatory resolutions and provides for recommendations only. By contrast, Chapter VII includes provisions for binding decisions of the Security Council. Thus, Chapter VII is concerned with mandatory resolutions, and, if the Security Council so determines, under that Chapter it can make recommendations or decide what measures can be taken under Articles 41 and 43 that would equal a decision—a decision, I accept, under Article 103 of the Charter, which provides that, in the event of a conflict of obligations on members of the United Nations, their obligations under the Charter shall prevail. A decision under Chapter VII would be applied by Article 103, but a recommendation under Chapter VI would not attract Article 103 and would not be obligatory. There is a distinction between the two Chapters. So the conclusions of The Times are wrong in law, quite apart from the special facts about the United Kingdom statement about the obligations of the resolution in this case.
      Sir Arthur Irvine: The right hon. and learned Gentleman has no doubt seen the article by the right hon. and learned Member for Devon (Mr. Thorpe) and the reference to the resolution about Korea. I recognise, as we all do, the total difference between that case and this one. But does he attach importance to the fact that the House of Commons by Resolution

      1765
      chose to regard the recommendation about Korea as an obligation?
      The Attorney-General: I understand that what the House of Commons did in 1950 with regard to Korea was to express by vote its attitude to the resolution.
      Sir A. Irvine: It referred to the "obligation".
      The Attorney-General: I have just been shown the terms. It expressed the obligation but it did not express the legal obligation which I suggest is the distinction between Chapter VI and Chapter VII of the Charter.
      All the resolutions concerning South African arms were under Chapter VI. The first, No. 181, of 7th August, 1963, called upon all States to cease the sale and shipment of arms and ammunition of all types and military vehicles to South Africa. The last Government did not accept that as mandatory or that they were obliged to do so, since they continued to supply ammunition and various other things to South Africa.
      The United Kingdom abstained on the resolution and expressed its reservations in an oral statement which said:
      "In view of our arrangements of cooperation with South Africa for the protection of the sea routes, we must reserve our position in the light of the requirements regarding the supply of equipment appropriate to these purposes."
      The United Kingdom made its reservations perfectly clear at that time. Sir Patrick Dean went on to say that he had listened to the United States representative, who had made it clear that the resolution, which the Security Council had just adopted, and the measures it called for all States to take should not he regarded as being a resolution under Chapter VII. This was followed by a written communication to the Secretary-General, in which the United Kindom said:
      "With regard to the particular terms of the resolution Her Majesty's Government wish to point out that they do not regard the resolution as being of a mandatory nature within the framework of Chapter VII of the Charter or, indeed, as falling within the terms of Chapter VII at all."
      It went on again to express the distinction made by the Government between arms for internal repression and arms required by the South African Government for external defence, and in par-
      1766
      ticular in order to be able to play their part in the joint defence of the Cape routes.
      So, both oral and written reservations were expressed to the Secretary-General and to the Security Council. The oral reservations were made in August, 1963, and the written representations in September, 1963. They were followed in December, 1963, by resolution No.182, in which again the representative of the United Kingdom said:
      "In giving support to this resolution, we do so because we regard the recommendations to Governments which it contains as being consistent with the powers of the Council in Chapter VI of the Charter and within the framework of that Chapter."
      We were again reasserting the position we had taken up on resolution No. 181 and emphasising the powers being exercised in Chapter VI.
      Finally, there was resolution No. 191 in June, 1964, in which the twelfth paragraph was important. It reaffirms
      "…its call upon all States to cease forth-with the sale and shipment to South Africa of arms, ammunition of all types, military vehicles, and equipment and materials for the manufacture and maintenance of arms and ammunition in South Africa."
      The use of the word "reaffirms" indicates the reference back to resolutions 181 and 182, and again, the United Kingdom delegate reminded the Security Council that the United Kingdom abstained, in August 1963, on resolution 181, and reminded the Security Council that the United Kingdom had stated its reservations on resolution 182 in December, 1963. The United Kingdom delegate at that time repeated the position of his Government on the export of arms, as stated in the Secretary-General's report, that report being the official record of the Security Council.
      In conclusion on this matter, from the record it is wholly clear that the United Kingdom clearly intended, as she was entitled, to apply the resolution in such a way as would permit the United Kingdom to supply weapons or ammunition in pursuance of the Simonstown Agreement. Moreover, any vote cast by the United Kingdom was cast on a basis that resolutions were recommendations only.
      My advice to Parliament would be that the non-mandatory resolutions, under Chapter VI of the Security Council do not create legal obligations. That is a view which has been held for many years

      1767
      in the past. In any event, the United Kingdom made its decision on the application of the resolutions quite plain. Indeed, the last Administration obviously followed that by supplying ammunition and equipment between 1964 and 1970.
      Mr. Raphael Tuck: If a resolution is passed in September that is non-mandatory and Great Britain says that she has reservations and will not support it, and later on, in December, she says that she accepts that resolution, does that not make that resolution binding upon her? If not, what is the difference between expressing a reservation in September and expressing her acceptance of the resolution in December?
      The Attorney-General: The hon. Gentleman has misheard me. The reservations were expressed on both occasions, and they were made perfectly clear, both orally and in writing, in August and September, 1963, and repeated in December, 1963.
      What is clear is that the difference between Chapter VI and Chapter VII is that under Chapter VI the non-mandatory resolution does not attract to itself Article 103, and in Chapter VII, where there is a decision, it does. As these were resolutions under Chapter VI, there was no question of the attraction of Article 103 to these particular resolutions.
      Mr. Robert Hughes: I wonder if the right hon. and learned Gentleman will explain why one votes for the resolution at all, following the kind of curious logic we are getting, that if one votes for it with reservations it has no meaning. So why bother to vote for the resolution?
      The Attorney-General: As the hon. Gentleman appreciates, the particular resolution was of many paragraphs. There was only one paragraph to which there was a reservation. This is in the last of these resolutions. The United Kingdom was making clear that its attitude was that it would not be supplying arms for internal operations but that it would retain its rights and obligations under the treaty which it had with South Africa.
      I deal shortly with two other points which I have read about or to which
      1768
      reference has been made. One point was as to why the Vienna Convention of 1969 was quoted in the White Paper. The reason was that those paragraphs of Article 31 of that Convention are a concise, authoritative and the most up-to-date statement of the relevant rules under the customary international law. The Law Officers were well aware that it is not in force, nor in any case applicable to treaties completed before it came into force but the Convention was quoted for convenience and because it expressed what is concise, modern and up to date with regard to the interpretation of the law on the interpretation of treaties.
      On the point raised by the right hon. Gentleman the Leader of the Liberal Party with regard to employment at the base, the instructions which I have received are to the effect that South Africa is carrying out its obligations under paragraph 4 of the letter of 30th June, 1955. But in any event, that is ancillary to the bases agreement. This is not the sea routes agreement, and, for it to affect termination of the other agreement, it would have to be essential to the accomplishment of the purposes of the Treaty. In these circumstances, if it is not essential to the purposes of the treaty, then it cannot affect the legality or the obligations of the Treaty which subsist.
      The sea routes agreement is a treaty. A treaty creates rights and obligations. This treaty remains in force. The Leader of the Opposition, when Prime Minister, said
      "…the Agreement is not capable of unilateral denunciation."—[OFFICIAL REPORT, 17th November, 1964; Vol. 702, c. 201.]
      In March of this year, the Aide Memoire dispatched by the previous Government said that the previous Government did not regard
      "the Simonstown Agreement as relevant to or affected by this decision"
      to refuse to allow the licensing of helicopters. After 1964 and the embargo of that time, the previous Government were licensing the supply of spare parts and ammunition.
      The right hon. Gentleman the Member for Dundee, East (Mr. George Thomson), when Minister of State, said
      "It is an accepted principle that a contract to supply equipment carries with it an understanding that the necessary spare parts will

      1769
      normally be provided."—[OFFICIAL REPORT, 26th January, 1965; Vol. 705, c. 150.]
      Clearly that was one of the obligations which arose.
      Mr. Thorpe: I do not ask the right hon. and learned Gentleman to answer my question at this stage if it breaks the chain of his argument, but I should like an undertaking that he will try to tell us whether the Government have accepted paragraphs 32 and 59 of his White Paper, that there is no general and continuing obligation, and that we are merely legally bound. I ask whether the Attorney-General will tell us that those legal obligations are accepted as being the exclusive legal obligations by the Government?
      The Attorney-General: I can answer that by saying that the legal obligations set out in the White Paper on the advice which the Law Officers gave to Parliament and previously to the Government, were accepted by the Government as the limit of the legal obligations which they have.
      In view of what has been said by my right hon. Friends, I emphasise the legal obligation, and that is limited, as we have said in our advice to Parliament and to the Government, to the initial equipment, which, in effect, amounts to the helicopters and the replacement spare equipment, and does not involve a general obligation.
      On the supply of Wasp helicopters and the figures for that, I do not propose to recite the whole White Paper, which was presented to Parliament so that Parliament could look at the argument based upon the facts and the documents. It is impossible to do that in a speech to the House.
      May I clarify the facts? The original supply of Wasp helicopters was prior to 1964 and was six, of which two were later written off, which amounted to four helicopters. In 1966, there was a supply of four more, and so, by July of 1967, there were eight in operation. At that time, in 1966, the South African Navy had two former Royal Naval destroyers, the "Van Riebeek" and the "Van der Stel", which had been purchased between 1950 and 1952, prior to the Simonstown Agreement and wholly separate from any obligation under that Agreement. From 1962 to 1966 the South Africans converted those vessels to carry Wasp heli-
      1770
      copters. The complement for destroyers, as the right hon. Gentleman will know, is two on board plus 2·5 back-up, which equals nine helicopters for the destroyers. The eight very nearly filled the complement for those two pre-Simonstown ships.
      In 1966 when those four Wasp helicopters were supplied—as I understand it, these were subsequently prayed in aid as fulfilling the obligation under Simonstown—the conversion of the three antisubmarine frigates provided under the Simonstown Agreement, the "Kruger", the "Steyn" and the "Pretorious"—to take helicopters had not even begun, let alone been completed. The first was not completed before 1969–70.
      Therefore, looking at the Agreement as a matter of law—after all, the Agreement must be construed having regard to how the parties behaved—those four Wasps in 1966 could not have been supplied under the Simonstown Agreement. They were the complement for the frigates. The complement for the frigates is one on board plus 2·5 back-up. So the three frigates needed 11. Therefore, the provision of helicopters in 1966 was not, and could not have been, partially completed by the four Wasps which were in fact provided for the two Royal Naval destroyers. [Interruption.] The right hon. Gentleman says that that is wrong, but he will see from the document that the South Africans were making an inquiry.
      I again ask the House to recollect the purposes of the Agreement and to recollect that the Agreement must be interpreted in good faith. I ask the right hon. Gentleman to remember that the inquiry was made by the South African Government after the then Prime Minister of the United Kingdom had said that oustanding commitments would be fulfilled.
      The South African Government made an inquiry as to Wasp helicopters and asked what the British Government were going to do. As appears from head (d) on page 34 the South African Government categorically asked for
      "(i) Replacement of Westland Wasp Helicopters which may be written off strength as a result of accidents or wear and tear, or augmentation in numbers to meet S.A. Naval requirements.
      "(ii) The continued supply of the complete range of spares and anti-warfare equipment to maintain Westland Wasp Helicopters in operational service."
      That was the inquiry posed by a party to a binding obligation.

      1771
      The other party asked for time to answer that inquiry. It received time to answer the inquiry. It was in these words that Her Majesty's then Government replied to the other party to an agreement which was then subsisting—these words appear on page 37:
      "I am writing to let you know that Her Majesty's Government will be prepared to supply additional Wasp helicopters to meet South African naval requirements. In reaching this decision, Her Majesty's Government have taken account of the fact that these specialised aircraft are integral parts of a complete antisubmarine weapons system supplied to South Africa under the Simonstown Agreement."
      Mr. Healey: I shall deal with this matter in more detail when I wind up. May I just put this to the Attorney-General at this point. This statement of general principle in response to a request by the South African Government for a statement of general principle was made immediately before the South African Government, having received this statement, asked Westland if it could make a contract for the delivery of four helicopters. The contract was not even drafted for another six months. The helicopters were delivered a year later. For other reasons which I shall explain later, there is no doubt whatever that the four helicopters delivered by the Labour Government were requested as part of the Simonstown Agreement to equip the frigates supplied by Her Majesty's Government under that Agreement. I shall adduce more detailed evidence from the present Government to support that contention when I wind up.
      The Attorney-General: The right hon. Gentleman will recognise that he has prolonged my intervention by making that statement. Others will argue moved by their political passions or their emotions. I am pointing the attention of the House to the inquiry and to the reply to that inquiry. The right hon. Gentleman must be careful in his choice of language and in asking the House to accept his version of the interpretation to be put upon the Aide Memoire. The South African Government, in making the inquiry, said:
      "it is not quite clear what the United Kingdom Government considers the precise scope to be of the 'outstanding commitments by the Ministry of Defence'"
      which the then Prime Minister had stated that he would fulfil. Under "Westland
      1772
      Wasp Helicopters" the South African Government specified
      "augmentation in numbers to meet South African Naval requirements"
      and
      "The continued supply of the complete range of spares and anti-submarine warfare equipment to maintain Westland Wasp Helicopters in operational service."
      Then there came a reply from the Government of the day. The right hon. Gentleman must, in reviewing this matter, cast aside his views on the political argument. The then Government stated categorically that
      "Her Majesty's Government will be prepared to supply additional Wasp helicopters to meet South African naval requirements."
      I ask the House to note the words "naval requirements". The then Government went on to say:
      "In reaching this decision, Her Majesty's Government have taken account of the fact that these specialised aircraft are integral parts of a complete anti-submarine weapons system supplied to South Africa under the Simonstown Agreement."
      I submit to the House that, on a correct reading of this document, it can only be an answer to an inquiry as to what the future will be with regard to the supply of Westland Wasp helicopters under the Simonstown Agreement.
      Mr. Healey rose—
      The Attorney-General: No, I will not give way.
      Mr. Healey: The Attorney-General has not met my point in any way whatever.
      The Attorney-General: I am coming to the right hon. Gentleman's point. I submit that Her Majesty's Government's letter dated March, 1965, was a categorical reply to a categorical inquiry. As a categorical answer it was an answer saying," We will supply Wasp helicopters under the Simonstown Agreement". So be it. That was what they said. It was in reply to an inquiry by the South African Government themselves in which they had asked for clarification of the statement by the then Government of the United Kingdom that they would fulfil Ministry of Defence outstanding commitments.
      Mr. Healey: The right hon. and learned Gentleman has not met my point. Of course I concede that this was a reply

      1773
      to an inquiry, but a great deal of the Attorney-General's case is based on the assumption that the four helicopters which the South African Government requested immediately afterwards, and which were supplied 18 months afterwards, were not intended for the Simonstown frigates. This is not the case and this is known not to be the case at present, and I shall produce evidence to this effect.
      The Attorney-General: The right hon. Gentleman keeps talking about his evidence. Those four helicopters, which first did not meet the complement of the frigates but which, second, did meet the complement of the pre-Simonstown destroyers, were delivered at a time when those frigates were not capable of taking those Westland Wasp helicopters. They could not have been. Therefore, they were not supplied under the Simonstown Agreement.
      Mr. Healey: Absolutely wrong.
      The Attorney-General: The right hon. Gentleman keeps on saying that I am wrong. How can the four go to make up the 11 which would be required for the frigates and which could not have been delivered under Simonstown because those frigates were not even ready or converted able to take the helicopters?
      Mr. Healey: I will answer the question which the Attorney-General has asked me. It is not a question of law.
      The Attorney-General: I am not giving way.
      Mr. Speaker: Order. We cannot have two right hon. Gentlemen on their feet at the same time. I understand that the Attorney-General has not given way.
      The Attorney-General: On this occasion, no. I have already given way many times. It is not correct for the right hon. Gentleman to claim that those four helicopters were supplied under the Simonstown Agreement, because they could not have been delivered at that time for that purpose because the ships were not fitted to take them. [Interruption.] The right hon. Gentleman will have his opportunity to put his case. I have been speaking now for about 40 minutes. The argument is set out in the White Paper and I am repeating it.
      1774
      If the right hon. Gentleman seeks to rely upon letters from officials as setting out what are the legal obligations, I suggest to him that the letters that he must have received from an official certainly have no bearing upon our legal obligations unless they disclosed any new facts or documents which are relevant. These helicopters could only have been supplied under the Simonstown Agreement at a time when the ships were ready to receive them.
      Mr. Thorpe: Will the Attorney-General please read paragraph 25? This may answer his point.
      The Attorney-General: Is the right hon. Gentleman saying page 25 or paragraph 25?
      Mr. Thorpe: The right hon. and learned Gentleman is saying that the order for helicopters was on a date before conversion. I should like to refresh his memory. Perhaps he would turn to page 9, paragraph 25. South Africa asks for a final four helicopters which was the totality of those orders which were supplied.
      The Attorney-General: These were not delivered for the frigates, they were delivered for the destroyers. When the frigates were converted in 1969 and 1970 the complement was 11 but the destroyers need a complement of nine so that there is a complement of 20 helicopters. When they asked for those four it was for the Royal Navy destroyers.
      Mr. George Cunningham: The right hon and learned Gentleman said, I am sure correctly, that letters from officials cannot constitute any modification or legal obligation. It is natural that the debate should be centring around page 22 in the White Paper. That is a letter from an official, and he seems to be praying it in aid as a gloss upon the legal obligation and strenthening the legal obligations which would otherwise exist. Does he not think that there iF inconsistency there?
      The Attorney-General: The letter is quite clear. It is from Sir Geoffrey Harrison on behalf of Lord Chalfont the then Minister of State. It said:
      "When you saw Lord Chalfont on 18th February he told you that we would try to let you have a reply … we are now able to let you have a reply about one of these points,

      1775
      namely, your inquiry about Wasp helicopters. In Lord Chalfont's absence in Washington I am writing to let you know that Her Majesty's Government will be prepared to supply additional Wasp helicopters to meet South African naval requirements …"
      It was a letter expressed on behalf of the Government.
      Mr. Cunningham: But not part of the treaty.
      The Attorney-General: In the interpretation of a treaty there has to be good faith. It is also necessary to look at the practice of the parties after the execution of their obligations under the Agreement.
      My duty in this debate is to comment upon the White Paper setting out the legal obligations. I acknowledge that it is difficult to consider these issues outside the context of strongly-held political attitudes. It is necessary before going on to consider what attitude every hon. and right hon. Gentleman will decide to adopt on the wider issue. Some parts of the White Paper are unpalatable to some hon. Members. The analysis of the interpretation in the White Paper is correct, the argument presented is supported by the facts and I suggest that the principles of law have been correctly applied.
      6.45 p.m.
      Sir Elwyn Jones: I know that the House will be grateful to the Law Officers for giving it their opinion on the legal obligations arising out of the Simonstown Agreement. The precedent of setting out a Law Officer's opinion in a White Paper is perhaps new, but I have no objection to that being done. The opinion of the Law Officers considers two aspects of the problems of the obligations which arise under the Sea Routes Agreement which I will consider. The first question they ask themselves is to do with what they call the general obligations which arise from the Sea Routes Agreement. The second question, which I invite the House to consider, is the extent, if any, to which the United Kingdom still remains under any specific obligations to permit the supply of equipment for the anti-submarine frigates which were supplied to South Africa under the agreement.
      On the first question, whether the Sea Routes Agreement imposes any general
      1776
      and continuing obligation on the United Kingdom to supply arms to the South African Government, the answer of the Law Officers is a very firm "No." I entirely agree with that conclusion. In my view the considerations which led the Law Officers to that conclusion on the question whether there was a general and continuing obligation to supply arms are relevant in considering what, if any, specific obligations still arise in respect of the Wasp helicopters and the equipment of the frigates.
      The principles are set out in paragraphs 54 to 58 of the opinion. The Law Officers begin in paragraph 54 by underlining the outstanding fact that:
      "The only express obligation in relation to the supply of arms or equipment that is imposed upon Her Majesty's Government by the Sea Routes Agreement is spelt out in paragraphs 2 and 3 of the Agreement. That is, of course, confined to the naval vessels there set out. Any further legal obligation on the part of Her Majesty's Government to permit the supply of additional vessels or equipment can only arise if such an obligation could be implied as a term of the Sea Routes Agreement".
      They go on then to deal with the question of the implied term.
      "The principle to be applied in considering this question is that a term should only be implied in a treaty when it is necessary to do so in order to give effect to the intention of the parties. Applying this principle it is necessary to reach the conclusion, in the light of the treaty itself, and other surrounding circumstances, that the parties must have intended to contract on the basis of the inclusion in the treaty of a provision whose effect can he stated with reasonable precision."
      I agree. In paragraph 57 it is said:
      "… the Agreement does not require the South African Government to maintain its maritime forces at any specified level nor with any specified type of armaments, nor does it impose any obligation on the South African Government to place future orders for naval equipment in the United Kingdom. So far as the provisions made in the Agreement were concerned, both parties retained their freedom to act as they thought best in determining the size, armament and sources of supply of their fleet. The undertakings in paragraphs 2 and 3 of the Agreement contained only limited obligations to purchase and supply arms."
      Then we come to the critical paragraphs. Paragraph 58 says:
      "In face of these conflicting arguments one must face the final question. If any term of the kind now under consideration is to be implied, how is such a term to be defined? It is here that the suggestion of any general and continuing obligation appears to run into

      1777
      difficulty. To what kind of quantity of equipment would any implied term extend? Over what period? And in what circumstances?"
      I submit that those questions—which, when asked in relation to the question of a general obligation proved in the view of the Law Officers incapable of answer so that no limitation could be put on this proposed implied obligation—arise precisely when one comes to consider the quality and limitations of any implied obligation that has to be included in the interpretation of the famous paragraphs 2 and 3 of the Sea Routes Agreement. It is clear that there is certainly no express obligation in those paragraphs 2 and 3 to continue to supply specific equipment. and certainly no provision to establish or create a general and apparently continuing obligation of an open-ended character to replace equipment for those frigates which is lost, destroyed or subject to fair wear and tear. It is conceded that there is no such express obligation and it is not possible, by virtue of the impossibility of defining the extent of the limits of the obligation, to read the proposed implication into paragraphs 2 and 3.
      If some general and apparently continuing obligation of an open-ended character to supply spares and replacements exists, what are the limitations of that obligation? For instance, does the obligation extend to the replacement of the frigates themselves or of the minesweepers lost or worn out? The Attorney-General says, "Of course not". But where is the line to be drawn? Apparently it is to extend to the provision of an indefinite number of spare helicopters for an indefinite period.
      The Attorney-General: Would the right hon. and learned Gentleman explain how, as we see from page 41, the Government whom he was advising were prepared to give in unrestricted quantities all matters neccesary for the modernisation of the South African Navy ships, and how does that arise under the Simonstown obligation if it is not the obligation to maintain the anti-submarine frigates efficient for carrying out the purposes of the agreement?
      Sir Elwyn Jones: The previous Administration spelled out very clearly the limitations to which they regarded themselves as bound by the Simonstown Agreement and set out plainly what was
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      to be supplied, whereas the mischief of the advice which the Law Officers have given to the House is the character of the commitment which they imply into paragraphs 2 and 3, the open-ended nature of which one can judge very readily by looking at the Summary of Conclusions. Paragraph 60 speaks of reserves of helicopters without giving any indication of how many, and of other equipment for vessels without giving any indication of what the equipment is, save that it is
      "such other equipment…as is necessary to keep the vessels efficient for the purpose of carrying out the objects of the Agreement."
      That is a wide, open-ended commitment which cannot be read into the agreement by any kind of implication. Answers to these questions are important so that the House may know what the Government regard as their duties and the extent of their obligations under the Simonstown Agreement.
      The obligation in the agreement is on the South African Government to purchase 20 ships in the United Kingdom. It is limited to a cost of £18 million and the period which is specified in the agreement is 1955 to 1963. Are those limits to be ignored? Further, does the Attorney-General say that the South Africans are under an obligation to buy all required replacements of the frigates, minesweepers and their equipment from the United Kingdom and nowhere else? If so, what is the basis of that implication?
      The Attorney-General: As I have said, it is to supply replacements
      "to keep the vessels efficient for the purpose of carrying out …the Agreement."
      Page 33 of the White Paper shows that the Government to whom the right hon. and learned Gentleman was adviser wrote to the South African Embassy on 17th December, 1964, saying:
      "It is not the Government's intention to withhold replacement parts that are necessary to maintain the South African Navy's ability to carry out its rôle in the defence of the sea routes round Southern Africa in accordance with the Simonstown Agreement".
      Would the right hon. and learned Gentleman say whether that accords with the advice which he is now giving the House, and whether that was the view expressed by him at the time?
      Sir Elwyn Jones: I am saying that the previous Government spelled out the kind

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      of replacement parts that they contemplated supplying. A shopping list was sent and in reply there was a specific statement by the Labour Government as to which items were to be supplied, whereas there is no limitation of a similar character in the Law Officers' opinion.
      If the South African Government are not under a legal duty to purchase replacements from the United Kingdom—and I do not think they are—I cannot follow on what basis a duty of a complementary character can lie on the United Kingdom. The sole duty of the United Kingdom under the agreement is to act as agent for South Africa in South African purchases of equipment in the United Kingdom and to permit the licensing of sales of that equipment to South Africa. No United Kingdom arms-producing company is under any legal duty by virtue of the Simonstown Agreement, to sell arms to South Africa. If through the Admiralty agency a legally enforceable agreement is made between South Africa and a United Kingdom armsproducing company, it will be governed solely by the terms of the agreement and, unless that agreement says so, it will not bind either party to obtaining future replacements, still less will it bind a shipbuilding company or any other company by implication to procure helicopters for South Africa.
      Therefore, in my opinion, the Simonstown Agreement creates no legal obligation on the United Kingdom to act as agents for the South Africans in obtaining replacements, the need for which has been caused by ordinary wear and tear or accidents.
      Paragraph 43 of the Law Officers' opinion implies an open-ended duty on South Africa and on the United Kingdom which cannot be spelled out from the agreement or by implication from it. Paragraph 43 may be appropriate to a practical arrangement between allies, but it does not involve any legal obligation. The conclusions in paragraph 51 which culminate in the sentence that there is a duty to include
      "replacement of such a number of helicopters as are necessary to arm and provide a reasonable establishment of reserves for the frigates"
      is not well founded.
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      As to the precise question of what normal equipment of helicopters, for instance, should be supplied with the 20 vessels or less, as the events turned out to be, referred to in paragraph 2 of the agreement, the agreement itself specifies no normal complement. In 1966, four Wasp helicopters were supplied and it has been of the essence of the Law Officers' opinion that they were supplied not in relation to any Simonstown frigate obligation, but in respect of the two former Royal Navy destroyers. They based their contention on the fact that when the four Wasps were supplied by the Labour Government the frigates had not been converted for carrying Wasps.
      No evidence has been produced in the White Paper to suggest that any commitment was owed by the Labour Government in 1966 to supply further helicopters for the former Royal Navy destroyers. South Africa had already received six Wasps in respect of those before 1964. Still less is there any evidence that the United Kingdom recognised such a commitment, and in the circumstances it is highly unlikely that it did.
      It is even less likely that the United Kingdom Government, after announcing the arms embargo, as they did, would, in the circumstances, act in breach of the terms of that embargo and supply Wasps for destroyers in respect of which there was no kind of international duty to supply the helicopters. Prima facie, therefore, it would seem likely that the supply of four Wasps in 1966 was in fact related to the commitment to equip frigates rather than re-equip destroyers, and if my right hon. Friend the Member for Leeds, East (Mr. Healey) catches your eye, Mr. Speaker, in due course he will develop the factual basis on which it can be said that it was the Government's clear understanding, as I understand from him, that the four helicopters were supplied for the frigates which are referred to under the Simonstown obligation.
      The Solicitor-General (Sir Geoffrey Howe): Can the right hon. and learned Gentleman explain to the House why the Government of which he was a member, apparently so reluctant to supply Wasp helicopters to the South African Government, were on this occasion and in this respect apparently so enthusiastic that in 1965 they asserted their willingness to

      1781
      supply those and in 1966 to do so, three years before the frigates were ready to receive the helicopters?
      Sir Elwyn Jones: There is no reason whatever why the helicopters should not have been supplied before the frigates were re-equipped. They would be needed for training, they would he needed for experience in handling; and, though I was not in the Royal Navy myself, I gather they do not need the deck of a frigate to learn to take off and land, but, no doubt, experience in so limited a space would be valuable in due course—but I will not go on to ground I do not understand.
      In dealing with this part of the argument—and I am sorry if it is a somewhat arid part of the argument, but it has to be faced—the Law Officers rely in paragraph 38 of their opinion on the Harrison letter of 9th March, 1965, which is Appendix 22, and that concludes with the sentence:
      "In reaching this decision, Her Majesty's Government have taken account of the fact that these specialised aircraft are integral parts of a complete anti-submarine weapons system supplied to South Africa under the Simonstown Agreement."
      The explanation of the terms of that letter clearly relates to the commitment under the Simonstown Agreement and the letter itself, as I submit, must be read in the context of the announcement of the arms embargo by the then Government
      "subject to outstanding Ministry of Defence commitments."
      Those commitments were, of course, commitments under Simonstown, and the Government of the day explained that announcement in the documents No. 22 and No. 23, and it is apparent from a reading and examination of those documents, and the clarification which they contain, that the reference was to the frigates and to helicopters intended to be supplied for the frigates.
      In my submission, looking at all those documents, it is clear that the four Wasps which were supplied in 1966 were intended for the frigates and not for the destroyers, and the only possible construction in the exchange of letters, as I submit, was that the Government would permit the supply of Wasps for the Simonstown frigates whether as the original complement or as being lost in
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      accidents or through mechanical defect, in the light of the circumstances in each case, but it was made clear that the Wasps would not be supplied in respect of helicopters written off as a result of fair wear and tear.
      In my submission, it is not relevant that the frigates had not yet been converted, and I submit that the Wasps could have been, and plainly were, supplied in the knowledge of the proposed conversion and in anticipation of it. In my submission that interpretation of events is supported by the correspondence in documents 26 and 28 of the exhibits to the opinion.
      As I have said—and I apologise for taking so much of the time of the House, but it is a matter of fundamental importance—in document 27 the Government, on 5th March, said that
      "any assurances contained in that letter"—
      that is, the Harrison letter of 9th March, 1965—
      "were met by the supply thereafter of four additional Wasp helicopters"
      and that the United Kingdom obligation in respect of the three frigates had thereby been discharged. In my submission, a fair reading of the exchanges which took place support and justify that conclusion.
      The Simonstown Agreement itself, as I have said, makes no reference to the normal complement of helicopters. It is significant that the 1967 request from South Africa, which we see set out in paragraph 25 of the Law Officers' opinion, says,
      "Originally six Wasp helicopters (of which two have been written off) and recently a further four, net total 8, have been acquired. 12 AS helicopters are required. Will the additional four be supplied during the period 1971-1973."
      Mr. Healey: Long after the frigates were at sea.
      Sir Elwyn Jones: Long after the frigates were at sea, as my right hon. Friend reminds me. As the first six supplied had been allocated to the destroyers it would seem that in 1967 the South Africans themselves were claiming two Wasps for each frigate, that is to say, six in all. As I submit that four were supplied by the then British Government, it would seem, on this basis, that the whole argument turns on two helicopters,

      1783
      and it is about those that the Commonwealth has been torn asunder.
      The fact is that the United Kingdom never accepted that the claimed complement was the correct or obligatory complement, nor was it under any compulsion to do so.
      Mr. Ian Percival: The right hon. and learned Gentleman's argument in conjunction with the intervention by his right hon. Friend seems to amount to this—that the four helicopters supplied in 1966 completed all the outstanding obligations under the Simonstown Agreement.
      Sir Elwyn Jones: Yes.
      Mr. Percival: I am glad that the right hon. and learned Gentleman confirms that. I can come to my question. How does he reconcile the letter in paragraph 25 with that proposition? Because the letter referred to in paragraph 25 was written after the supply of the four helicopters and it is asking for another four helicopters.
      Mr. Healey rose—
      Mr. Percival: No, I do not think I can allow the right hon. Gentleman to interrupt me while I am interrupting his right hon. and learned Friend. Let me gather my thoughts. Four more helicopters were being asked for in the letter referred to in paragraph 25, and they were four more, in addition to those supplied in 1966. If the view of the Government then was that the obligations had been fully discharged by the supply of the previous four, why did they not write and say, "There are no more to come—"
      Mr. Healey: We did.
      Mr. Percival: —instead of what appears in paragraph 27?
      Mr. Healey: That is precisely what we did.
      Sir Elwyn Jones: That is precisely what the Labour Government did, and the reference is clear. That was done, among other things, in the letter of 5th March, 1970, where the matter is set out clearly.
      Mr. Percival: Three years later.
      Sir Elwyn Jones: I do not want to take any more time on this. There were
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      other communications before that which will be seen. My right hon. Friend who was dealing with these matters at the time will no doubt give authoritative information about them when he catches your eye, Mr. Speaker.
      There remains the question of the meaning of Document 23 which is on page 37 of the Opinion, the letter of 31st May, from Sir Roger Allen. Taken with the other documents, it is consistent with the view that the United Kingdom's legal liability under this agreement could be limited to permitting the provision of licences for a complement of four Wasps for three frigates, for the replacement of Wasps lost in accidents or through mechanical defect in the light of the circumstances of each case as it is put, that is to say, where blame could reasonably be attributed to the manufacturer, and not otherwise, but not for replacements required by normal wear and tear, and not for Royal Naval establishment standards in so far as they exceeded either the South African claim or the complement of four that was supplied.
      My conclusion from this is that the liability resting upon the United Kingdom is stated, if I may say so with respect, far too widely in paragraph 39 of the Attorney-General's Opinion, in that it first overstates the initial complement, secondly, wrongly allocates to the two ex-Royal Navy destroyers the four helicopters which were plainly supplied in pursuance of the Simonstown undertaking to equip frigates, and, finally, wrongly accepts an open-ended obligation of replacement. In my opinion, the legal obligations on the United Kingdom arising under the Simonstown Agreement are at the highest shadowy, and a strong case can be made out that they have long since been fulfilled by this country.
      I do not, of course, exclude the possibility that my opinion may be wrong. It would surprise me if the right hon. and learned Gentleman were not prepared to say the same about his opinion. In view of the importance which Her Majesty's Government attach to this legal issue, I submit with great seriousness and respect that we should be well advised to consider seeking the advice of the Privy Council upon this matter. I am not alone in expressing this view; on the limited problem of the construction of the Agreement there is distinguished support for it. This country has, happily,

      1785
      the outstanding authority, distinction and independence of the Privy Council, and in respect of this grave matter that is the least that Her Majesty's Government can do.
      7.14 p.m.
      Mr. Patrick Wall: It is not for me to follow the legal arguments adduced by the two right hon. and learned Members. I want to deal with the problem which the House faces, not only the legal obligations, which have been discussed in detail, but the moral obligations of maintaining a defence agreement with another country.
      Before doing so, may I say that many hon. Gentlemen opposite in this debate have tended, as we all do, to condemn apartheid. But they fail to realise or to say that there are in South Africa an independent Parliament, independent courts, independent newspapers and independent trade unions, although I recognise that membership of those trade unions is limited. I ask the House how many African countries can claim the same?
      My complaint is that too often in this country and sometimes in the House double standards are applied when we are talking about South Africa. I am the first to condemn apartheid. I believe it to be not only a wrong but a stupid system, but when anything happens in South Africa there are immediate condemnations in the Press and in the House. Why are there so few protests about Zanzibar? Why were there so few protests by the Government of the day when Othman Sharif, who was a member of the Zanzibar/Tanganyika Government, was sent back to Zanzibar and executed? He was a man I knew well, but I heard very few protests in the House at this futile murder of a former member of the Zanzibar Government. There were few protests about the recently reported forced marriages and about the members of the legal Government of Zanzibar who were so many years in prison.
      I do not want to labour this, because we are not discussing race relations today, but all too often when talking about South Africa we apply double standards. Let us compare like with like. Let us compare what is happening in South Africa with what happens in other parts of the African continent. There have
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      been 32 attempted revolutions in 23 countries in Africa in the past six years.
      Why is racialism always reported in this country as white v. black? What about Fiji, Ceylon, Guyana, Malaysia? What about the troubles in Nigeria. Biafra, Uganda, Chad and so on? Why is South Africa always condemned by comparison with British rather than African standards? Why these double standards?
      We are told by the leader of the Labour Party, who seems to be obsessed with race, that we are heading for a race war in South Africa. To talk of a "blood bath" is nonsense, because the situation in South Africa is changing. I say straight away that it is changing all too slowly. It used to be Baascap, which I define as the divine right of whites. Then came apartheid, which I define as first-and second-class citizens. It is moving rapidly towards separate development, which means that the races live in their own communities, which most of them prefer. The evil part of apartheid is that those who want to mix cannot.
      I believe that job reservation is breaking down. The South African Government have the chance of increasing industrial output and the standard of living by dropping job reservation. If they do not drop job reservation their industrial output will immediately decline.
      Mr. Gavin Strang: May I give a quotation from the Johannesburg Star of 27th February, the edition which carried the news of and the political comment on the Government's decision:
      "No relaxation in jobs. Continuing the anti-verligte trend the Government this week stood firm on its job reservation policies, insisting they would not only remain on the statute book but would, in fact, be implemented more strictly in the future."
      Mr. Wall: I do not know if the hon. Gentleman has been to South Africa. Those who have know that job reservation broke down several years ago and is increasingly disregarded by the authorities. In the near future it will be recognised that the better jobs can be held by white and black. This is the only way in which the economy of South Africa can continue to expand.
      I remind the hon. Gentleman that when I was in the United Nations I said:
      "Apartheid is morally abominable, intellectually grotesque and spiritually indefensible."

      1787
      I believe that, because the effects of apartheid are evil and because apartheid is based on fear. Some hon. Gentlemen opposite are stirring up this fear whenever they can. They therefore intensify apartheid, intensify fear and make the situation in South Africa so much worse. Who would gain by revolution in South Africa? Would the whites? Would the blacks? The only people who could gain are the Communist Powers.
      Mr. John Mendelson: As one who has been to the Republic, may I say that the hon. Gentleman should not make play with the fact that my hon. Friend has or has not visited that country. He knows that when he talks to leading industrialists their main complaint is that economic progress is being prevented by strict adherence to job reservation. He is not condemning apartheid. He is whitewashing it, as he does all the time.
      Mr. Wall: There was not one industrialist in South Africa who recognised that job reservation was being maintained as the law says it should be maintained. It is breaking down and the hon. Gentleman knows it. Let us encourage this to continue.
      I condemn hon. Gentlemen opposite who openly encourage guerrilla fighters in Southern Africa and who themselves by so doing are attempting to sabotage the standard of life of everybody and to destroy all races in Southern Africa by encouraging chaos. The only country which might gain from this is not so much the Soviet Union but Communion China, because Communist China wants chaos in this part of Africa. The South Africans believe that the Communist powers have plans to cut Africa in half from Zanzibar to Brazzaville. Hon. Gentlemen opposite may think that this is far-fetched, but it is fair to say that there is a considerable danger that this might happen.
      South Africa believe, and they are right to believe, that there should be a southern hemisphere defence pact. Let us recognise the vital importance for the West of the industrial areas of the southern hemisphere in South America. in South Africa and in Australia. This could be linked through Britain to N A.T.O. as for political reasons
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      N.AT.O. is unlikely to be extended to cover the Cape.
      Hon. Gentlemen opposite, particularly the Member for Penistone (Mr. John Mendelson), must appreciate that the choice in Southern Africa is between revolution and evolution. I know that the hon. Gentleman wants to see revolution. How is he to get revolution?
      Mr. John Mendelson: The hon. Member is supporting the racialists.
      Mr. Wall: There are three ways in which revolution may be carried out. The first is by internal revolution—and anybody who knows South Africa knows that that is unlikely. The security in the country is such that internal revolution is extremely unlikely. Then there are the incursions of the guerrilla fighters. I have travelled from one side of Africa to the other, along the black-white frontier from Muede to Villa Cabral, along the Rhodesian frontier from the Portuguese frontier to Kariba and also to the Caprivi Strip. I have seen this area and know how impossible a frontier it is for guerrillas to cross. I do not believe the guerrilla fighters will have any success in the south. This is shown above all in Rhodesia where they have not even the support of the other Africans who immediately report the "freedom" fighters to the authorities. If they have been so unsuccessful in Rhodesia how much less successful will they be in South Africa.
      Then there is the question of external attack, with which Dr. Banda dealt satisfactorily when he suggested that Rhodesia could take on the rest of Africa together. How much more so South Africa!
      Perhaps what the hon. Gentleman is hoping for is United Nations intervention and blockade. That is most unlikely, certainly now the present Government are in power, as I hope that any such suggestion, if it ever came before the Security Council, would be vetoed. I believe that the United States and the French would do the same.
      What we believe in, and what I believe all people of good will should believe in, is evolution rather than revolution in Southern Africa. I believe that it can happen. I have visited South Africa over a number of years, but in case any accusations are made against me, may I

      1789
      say that I have no business interests there. Each time I go there I see a slight improvement. I will not exaggerate the improvement, but it is a slight one. Things are moving gradually in the right direction.
      Mr. John Mendelson: Whitewash!
      Mr. Wall: This can be seen from the general elections and the provincial elections where the H.N.P., the extreme rightwing party, was totally defeated. My experience is that the nationalist youth is different from the previous generation. When one talks to them about apartheid they say "We cannot see any alternative at the moment, but we recognise that this situation may not last very much longer." That is different from the concept of Baascap believed in by many of the older generation.
      The evolution is slow but sure. In the Transkie there are 3,900 black civil servants and only 334 white civil servants; there are 7,000 black teachers and only 53 white. At least we have learned in our decolonisation of Africa that once one passes over the Civil Service, one passes over power. The Transkie will when it so desires be as independent as Lesotho or Swaziland. I believe that the good neighbour policy is beginning to pay great dividends both to South Africa and to her neighbours. This has been effective in relation to Malawi, Lesotho, Swaziland, Botswana, Malagasy Republic, the Ivory Coast, Gabon, Dahomey and Ghana. I believe that these independent Africa states should have our support, in their desire for a dialogue with South Africa.
      I would remind the House that the Simonstown Agreement was signed when South Africa was part of the Commonwealth. It was therefore signed between friends and allies. Perhaps it was not spelt out as much as it should have been. Certainly if one makes an agreement with a foreign country it is usually spelt out in much more detail than an agreement made as between Commonwealth partners. Perhaps this is half the difficulty in the regard to the legal arguments we have heard today.
      The South African Government made an agreement and they expect it to be implemented, not only legally but morally, by both sides. I do not believe
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      that the Labour Administration implemented the agreement as a defence agreement between two partners. Let us remember that the agreement does not only give us the use of this harbour in Simonstown, but the use of all South African ports in time of war, whether or not South Africa itself is involved. What other countries in Africa would offer us such advantages?
      I believe that there is grave danger in the Soviet maritime expansion which has been taking place in the Indian Ocean, although this has been laughed at by right hon. Gentlemen opposite. I would remind the House that only today the Chief of Naval Operations of the United States Navy was reported in the Press as saying that the Americans were worried about the increased Soviet maritime infiltration in the Indian Ocean which, he said, would outflank N.A.T.O. within a generation. Yet we are told by the Opposition that the Americans do not support my right hon. Friend the Prime Minister in his intention to implement the Simonstown Agreement. I believe the danger from the Soviet Navy is that it is the right arm of the political power of the Soviet State as has been proved in the Mediterranean. The whole of the northern seaboard of Africa, with the exception of Morocco, Tunisia, Israel and Turkey, has become potentially hostile to the West. One of the reasons for this is the activity of the Soviet Fleet in the Mediterranean. Neither side of the House wishes to see this story repeated in the Indian Ocean. That area is extremely important to us and, unlike the Mediterranean it cannot be covered by aircraft from shore bases.
      When with two of my hon. Friends I visited Southern Africa last May we were shown a maritime plot in Simonstown. We were shown photographs which illustrated the growth of movements of the Russian task force in the Indian Ocean particularly when any trouble arose. There was a task force off Somaliland when there was a revolution in that country. There was also a task force off the Natal coast when there was trouble in Lesotho. This is what I meant when I said that the Soviet Navy is the right arm of Soviet political power. This is the danger that we have to face.
      Let us not forget that political power can be exercised through a third party, through some other country in Africa

      1791
      which might be egged on by the Soviet Union. We must remember what happened in Indonesia which was armed by the Soviet Union and where President Sukarno was supported both by the Communist Party and the army. Largely due to confrontation in Malaysia, when the two sides clashed the Communist Party was defeated. If that had not happened there would have been serious consequences indeed in the area. That kind of thing should be repeated in Southern Africa.
      I sincerely believe that the Soviet Government are not looking for war, but they are looking for opportunities to expand their influence and political power in various areas. Only strength will deter the Soviet Union, as it did over Berlin, and also over Cuba. Indeed N.A.T.O. itself was set up to deter Soviet aggression at the end of the last war and has been an outstanding success.
      I believe that the Cape is the back door of N.A.T.O. and that Britain must be the link between that area and N.A.T.O. since, for obvious reasons, N.A.T.O. cannot extend its influence to the southern hemisphere. Britain lives by its seaborne trade, and by seaborne trade alone, and the West lives largely on Middle East oil. During our visit there were over 1,000 ships within 10 days' steaming from Cape Town. Some 1,250 ships called at South African ports within one month last year. Half a million tons of oil passes Cape Town each day. A short while ago, a Question was answered in this House saying that 50 per cent. of the oil imported by us, 25 per cent. of our foodstuffs and 5 per cent. of our minerals pass the Cape. That information was given in answer to a Parliamentary Question, so presumably it comes from official sources, whatever the hon. Gentleman opposite may say.
      One of the dangers of Soviet sea power is the vast nuclear submarine fleet, which is larger than those of America, Britain and France put together. For that reason, it is very important for us to have an anti-submarine base on the key trade route round the Cape. In documents released only a week or two ago, it was said that, during the last war, the British Government contemplated taking over the Southern Irish ports by force because we needed an anti-submarine base on
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      what was probably our most important trade route. Fortunately, it was not done, but it was contemplated. I think that that illustrates the importance of an anti-submarine base on a key trade route. It also underlines the fact that reinforcement of the South African Navy would be disproportionately effective. The South African Navy is after all almost wholly an anti-submarine navy designed to support the West. The Government have concluded that our legal requirement is to supply South Africa with Wasp helicopters. However, I hope that they will go much further. Above all, South Africa needs Nimrod anti-submarine aircraft, which are probably the finest in the world. The hon. Member for Penistone knows that if we do not supply them, the French will sell South Africa their Breget Atlantique, which is greatly inferior to the Nimrod. I assume that the hon. Member for Penistone would prefer to see French workmen benefiting than his own people. I disagree with him entirely, as, I am sure, do most hon. Members.
      South Africa also wants a supply of Sea Cat surface-to-air weapons. In time of war, the South Africans are bound to service our ships in Simonstown. If they have not the expertise in the use of these new missiles, they can hardly be expected to carry out this service efficiently. I hope, too, that the South African Government will want replacement frigates probably of the smaller Vosper-Thorneycroft type. Her Majesty's Government have said that they will consider requests on their merits. I hope very much that these requests will come and that they will be approved.
      I hope, too, that the Government will consider supplying more Buccaneer aircraft. In that connection, I remind my right hon. Friend the Foreign Secretary that he undertook in my constituency, where the Buccaneer is built, that when we came back into power these aircraft would be supplied to South Africa.
      The Leader of the Liberal Party quoted many remarks made by my right hon. Friend when he was Leader of the Opposition. I will point out one that he did not quote—it is probably the most significant remark on this subject made by the Prime Minister. In winding up that debate in December, 1967, my right

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      hon. Friend said about the previous Administration:
      "The Government have taken the wrong decision. They have failed entirely to justify it to the House. It is damaging to our national interests in finance, in trade and in defence, and a Conservative Administration will reverse it."—[OFFICIAL REPORT, 19th December, 1967; Vol. 756, c. 1152.]
      I believe that the Conservative Government are now fulfilling their legal obligations. I hope that they will go beyond the strict letter of the law and very soon fulfil their moral obligations, which form another part of a vitally important defence agreement. The fulfilment of those moral obligations would be enormously to the advantage of Britain, the West and the Commonwealth.
      7.35 p.m.
      Sir Arthur Irvine: Quite rightly, the hon. Member for Haltemprice (Mr. Wall) has taken this matter rather away from the quiet waters of legal discussion which occupied our attention earlier. I return to the legal aspects of this matter only because I feel that there are one or two points which can usefully be deployed. I speak in this debate as a lawyer, and I am concerned with the legal points which arise on this matter.
      I want to stress, first, the importance that I attach to the interesting fact that my right hon. and learned Friend the Member for West Ham, South (Sir Elwyn Jones) and the Attorney-General are at one on the matter of law contained in the conclusion in paragraph 59 of the White Paper. I join with them in their agreement. It is a very important one. It is excellent that lawyers on both sides of the House should be at one on this matter.
      The paragraph expresses the conclusion that
      "…it would not be reasonable …to impute to the parties an intention to include a term in the Sea Routes Agreement which would place any general and continuing legal obligation on Her Majesty's Government to permit the supply of arms to the South African Government."
      I am sure that the House will appreciate how important it is that common opinions are held on both sides about this legal effect of the Agreement.
      I turn, then, to the Summary of Conclusions contained in paragraph 60, and I desire to put forward two qualifications
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      on what is contained in that paragraph. The first is a minor qualification. The other raises somewhat wider considerations.
      The minor qualification is that I am not content with the expression "together with reserves" in subparagraph (1). It is a rather vague and open-ended expression. I mention that in passing since I feel that it would have been better to have had a clearer limitation upon the width of the effect of the paragraph.
      My wider qualification is that the Law Officers' opinion contains no reference to resolution 191 of the United Nations which was made in 1964. Let me remind the House of the content of that Security Council resolution. It called upon all States to cease forthwith the sale and shipment to South Africa of arms and ammunition of all types, military vehicles and equipment, and materials for the manufacture and maintenance of arms and ammunition in South Africa.
      I want to make it plain that I am concerned with the legal aspect of the matter. I leave aside ideological questions of how one regards the United Nations and how much or how little hope one reposes in that institution for the future. Looking at the matter as a lawyer, I suggest that it is not or should not be possible to ignore that resolution. Yet the main body of the observations and the opinions expressed in the White Paper, the value of which I acknowledge, make no reference to that resolution. The only reference to the resolution is in the annexe in the Aide Memoire dated 5th March, 1970, quoted on page 46.
      If hypothetically all supply of arms to South Africa were stopped and the point were taken in the International Court that we, by stopping the supply, were in breach of contract and of treaty, I put forward the view that, to put it at its lowest, that United Nations resolution would, as a matter of law, possess some importance and would be a relevant point to take up.
      The Attorney-General: I appreciate that it seems to be a matter of some importance in law. Perhaps the right hon. and learned Gentleman will tell the House what importance it has in law. The right hon. and learned Gentleman will recollect that resolution 191, if he

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      says that this creates an obligation, refers to calling upon all states to cease forthwith the sale and shipment, among other things, of ammunition. The right hon. and learned Gentleman was a Law Officer in the last Government, so he will appreciate that that Government licensed the supply of ammunition and other equipment during their years in office. Was that in breach of the United Nations resolution?
      Sir A. Irvine: I mean no discourtesy —I hope that that goes without saying—when I say that that is a party point.— [HON. MEMBERS: "No."]—I think that it is.
      Mr. Wall: What about torpedoes?
      Sir A. Irvine: What I am suggesting is that the resolution cannot be ignored. The Attorney-General will surely recognise that I choose my words carefully in a matter of this kind. What I said, just before the right hon. and learned Gentleman interrupted me, was that I could not believe that the fact that this resolution had been passed in the Security Council would be regarded as unimportant if the question of a breach of treaty or of contract came before the International Court. I deliberately did not go further than that. One measures one's terms carefully when making a speech of this kind on this subject.
      The importance which, as a matter of law, attaches to this point was indicated in the observations of the right hon. Member for Devon, North (Mr. Thorpe). The right hon. Gentleman reminded us of the resolution which was passed on Korea. It will be recalled that that Resolution was a recommendation. It was something less, it may be thought, than the call which is expressed in Resolution 191. The House of Commons chose to treat that recommendation as an obligation in terms in a Motion carried in this House without a Division. That afforded the very foundation of the presence of Commonwealth forces in Korea.
      It is a relevant point. I go no further than to say that. It is true that the Motion which was carried did not refer to legal obligations. I acknowledge that that is so. But I draw attention to the point that, quite gratuitously, so to speak,
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      this House took a recommendation and called it an obligation. It is fair to put it in that way.
      If this matter came for consideration before the International Court, I believe that some weight would be attached to that resolution. I have already indicated that I do not want to be caught up in the ideological issues to which the expression "the United Nations" is apt to give rise. But it is a serious matter if the point has been reached, on an issue of this kind, at which the House of Commons goes through the whole issue of obligation and liability under contract and treaty and pays literally no attention to a resolution of this kind. It is interesting and may possess some importance that the White Paper has the characteristic of ignoring the resolution to which I have referred.
      Mr. Percival: I assure the right hon. and learned Gentleman that I do not wish to get caught up in ideological or party arguments. The right hon. and learned Gentleman has drawn the attention of the House to the fact that the Korean resolution which was adopted by this House expressly by a resolution in terms which involved the acceptance of an obligation. Surely that is the difference between the two cases. In this case, this resolution was not adopted by the House by a similar Motion. On the contrary, our vote at U.N.O. was subject to express reservation.
      Sir A. Irvine: I take the point made by the hon. and learned Member for Southport (Mr. Percival). I fully recognise that in the respect which he has mentioned, and in others, there is no close parallel between the two. I am merely saying that in that instance the House took cognisance of a recommendation and chose to speak in terms of an obligation based upon it.
      Mr. Percival: But did not do so in this case.
      Sir A. Irvine: We must remember the over-riding position. If there be any content in the proposition which I have thus far put forward, we must remember the language of Article 103 of the Charter, which the hon. and learned Gentleman will remember:
      "In the event of a conflict between the obligations of Members of the United Nations under the present Charter and their obligations under any other international agreement, their

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      obligations under the present Charter shall prevail."
      I do not go further than to put before the House the possibility that, as a matter of law, the point has been reached that when considering the continuing legal obligations under the Simonstown Agreement it is not necessarily right and proper totally to ignore a resolution of the United Nations. That is putting the case, heaven knows, with moderation, and I offer it for the consideration of the House.
      7.50 p.m.
      Mr. John Boyd-Carpenter: Although I was once in chambers with the right hon. and learned Member for Liverpool, Edge Hill (Sir A. Irvine), or perhaps for that very reason, I do not propose to follow him in the legal argument which he has just addressed to the House. I do not do so not because I under-rate the importance of meticulous observance by this country of its legal international obligations but because the legal aspects of the matter have already been more than sufficiently ventilated in the debate. Nor do I believe that the debate turns on the legal aspects, important though they are. We are concerned, with all respect to the law which I once served, with matters of bigger import, the relationship of nations and the defence of the realm, with great moral issues on either side that properly raise the passions of Parliament and people. It is more on those great issues that I should like to say a word or two this evening.
      I am very glad to have caught that elusive organ, your optic, Madam Deputy Speaker, for two reasons. The first is that I was, in the Government of my right hon. Friend the present Foreign and Commonwealth Secretary and in the closing years of that of Mr. Macmillan, the Minister directly responsible, as Chairman of the appropriate committee, for licensing the export of arms, including of course arms to South Africa. The second reason is that I was very recently in that country, and only a few weeks ago had a long conversation at Simonstown with the very distinguished officer who commands the South African Navy. Therefore, I should like to offer one or two comments on the general problem.
      Up until October, 1964, under the system which it was my duty to administer,
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      exports to South Africa were licensed of arms required generally for defence against external aggression but not of arms specifically intended or probably to be used for purposes of internal repression. I know that there were marginal cases and that difficult, almost philosophic, arguments can be adduced on the uses of a particular weapon. But that was the policy which was applied for a great many years, and applied with general acceptance. Today the Leader of the Liberal Party talked of the hearts and minds of hundreds of millions in Africa, there was talk about splitting the Commonwealth, and giving a certificate of respectability to apartheid. All these issues that appear now to arise were never raised. The policy was accepted, and it operated—I think that this is of importance in this situation—without any of the dangers and difficulties which we are now told will occur if anything like that is done now.
      It seems to follow that the state of affairs we are now in, and the emotion in the House and outside which I acknowledge, are not the necessary consequences of the sale of arms for the purposes of external defence but are the direct consequence of the policy of the late Government and the deliberate emphasis which they and others outside have given to the emotional aspects of the matter. They promptly, and in a most ill-considered way, reversed the policy in the autumn of 1964 and operated instead a policy wholly devoid of logic and common sense. For they were proud to trade with South Africa. Less than a year ago the right hon. Member for Barnsley (Mr. Mason), as President of the Board of Trade, loudly acclaimed at the Dispatch Box the size of our exports to South Africa. The Opposition talk about giving a certificate of respectability to apartheid. Is not £180 million-worth of exports a rather more substantial certificate than the sale of a limited quantity of arms?
      Under the Labour Government the Royal Navy and the Royal Air Force took part regularly in joint naval exercises with the South African Navy, and they took part in mutual planning. The clear implication and inescapable impliaction was that in war we should be fighting as allies. That was apparently all right. No certificate of respectability of

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      apartheid was implied in it. But, with a complete and lamentable lack of logic, the Labour Government jibbed at supplying our partner in the exercises and our potential ally in war with the instruments necessary to enable that partner to be efficient. That is logically wholly indefensible.
      A curious lighter note is that, while the late Government refused the country with which it was undertaking exercises the ships and aircraft that would enable it to keep its forces up to date for the very purpose which the exercises were designed to test, there was no restriction on the export of handcuffs to South Africa, the plainest example of an instrument required for repression.
      The Labour Government did not deprive South Africa of many of the arms it needed. The French have been supplying submarines, yet no one regards the French as committing a morally despicable act, degrading their reputation.
      Mr. Robert Hughes: Yes, we do.
      Mr. Boyd-Carpenter: This is very new. The African countries do not appear to do so. Monsieur Pompidou has just returned from a triumphant tour of Africa, where he received the plaudits of the African countries. It is only if Britain supplies arms that it is apparently so morally perverse. If France does it, and French workmen gain the employment for which our shipyards are crying out, that is apparently all right, but it is wrong if Britain does it.
      Two things have happened since 1964 to alter the situation, and alter it enormously in favour of the then policy. One is the arrival of the Russian fleet in the Indian Ocean. Whatever the Russians are there for, they are not there for the fishing. The expense of maintaining a large fleet a long way from any base is very heavy, and that expense is undertaken only for very definite political purposes.
      My hon. Friend the Member for Haltemprice (Mr. Wall) referred to the plotting of the movements of that fleet by the South African naval and air authorities. I saw perhaps more recent plots. There is great significance in the movement of that fleet. Sometimes it lies in its anchorage north of the Seychelles, but
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      whenever there is trouble in any part of Africa a squadron moves close inshore. It is perhaps not without significance that that squadron always includes a submarine, which is the obvious vessel for landing people for subversive purposes.
      Strange things are going on in those waters. Aerial photography shows what look like merchant ships with, certainly in one case, a full-sized helicopter and a launching pad on the stern, and another carrying sea-to-air missiles. It is foolish for the House, as it would be for the country, to ignore what is going on there.
      The other change is the closure of the Suez Canal. Whether the Canal will ever reopen, I do not know. But the Cape route will remain the most important route even if the Canal reopens, because shipowners have developed very large bulk carriers for oil and other cargoes which could not use the Canal even if it were reopened. So the route is vital to us.
      Of course, we could defend it without South Africa. In an article on the matter a few weeks ago, the Economist pointed out that technically this could be done if we created a great fleet train and provided air cover with aircraft carriers, but that it would cost many scores of millions of pounds a year and great capital expenditure. Do Labour hon. Members advocate that?
      Assuming, as I must, that they do not wish, any more than we do, to see the defences of the country made precarious —that they do not want to see the Communists left with overwhelming power in a vital sea area—is their repugnance to doing anything in partnership with South Africa such that they are prepared to see our defence expenditure raised by perhaps £100 million or £150 million a year?
      If so, I would feel that they had a respectable and tolerable argument. If not, then are they not putting themselves in the position of allowing their understandable dislike of the South African system to cause them to advocate a course of action which must, in a very dangerous world, undermine some of the vital defences of this island?
      It is an attitude which I am certainly not prepared at any price to adopt. I prefer the policy which was applied before 1964—of co-operation with South Africa

      1801
      in these matters—and of course that involves, as it must logically involve, not allowing their Navy or Air Force to get out of date. It involves supplying, in due course, corvettes, which I understand they want and Nimrod aircraft for maritime reconnaissance work. It involves supplying them with these and other items not because—I hope I need not repeat this again—I have any affection for their system but on the coldly calculated basis that it serves the vital defence interests of this country.
      I must, of course, face the argument that this will disrupt the Commonwealth and will not, therefore, be in our interests. The argument is adduced that countries in Asia and Africa will flounce out of the Commonwealth in high dudgeon if we resume the policies in which they apparently acquiesced happily up to 1964. I do not believe it, and to suggest that they will do it is to cast a reflection of puerile amateurism on the leaders of those countries, which is unjustified.
      I am sure that they will protest, but the Commonwealth has existed because while we are free to protest, we nevertheless consider ourselves to be independent Members of this great organisation. After all, Pakistan and India went to war with each other a few years ago, but both remained loyal Members of the Commonwealth. India outraged feeling in this country and involved our treaty obligations when she overran Goa, but there was no question of India being driven out of the Commonwealth.
      I cannot accept that the Commonwealth is such a fragile affair as some people make out. If I am wrong, then probably it is already near being finished because sooner or later another disagreement must arise. At present we are not faced with having to weigh our national defence in this area against outraging the Commonwealth.
      I have left to the last a reference to a matter which many of us consider to be the heart of this issue, and that is the effect of this in South Africa and on South Africa's policies. There is no question but that the South African system of apartheid—which I very much disliked when I saw it, as anybody dislikes it when they see it—will not be upset by force. It will, I believe, be upset by the developing economic forces of a growing commercial and industrial economy.
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      We are, after all, talking of a country in which there is an apparent political paradox, with the extreme upholders of apartheid—or the extreme Right, if one wishes to put it that way—being the unskilled workers in the trade unions and with the multi-millionaires on the Left. This is a country which, as it develops commercially, demonstrates the complete impracticability of separate development in the modern world.
      It was possible for a pastoral society to have job reservation and restrictions on residence, but these cannot stand up to the growing forces of economic progress. As I saw for myself, one must add, I am glad to say, the strong influence of the younger generation of Afrikaaners.
      I do not want to mislead the House and I agree that this will take time—[Interruption.] perhaps many years—but there is one factor which could halt it. If there is any racial stock which is more obstinate and less willing to be browbeaten and bullied than our own, it is the Dutch, and we are dealing in the ruling races in South Africa with a mixture of both. If the world seems to gang up on them or denies contact with them, they will go into laager, as their forebears did for 300 years.
      Thus, when dealing with an issue on which the House is united—we all want to see improvement and change in their internal affairs—the argument is really the reverse of what was stated by the Leader of the Opposition. By full renewal of proper defence contacts, not on the basis of what is our precise and limited legal liability but generously and fully, we shall help the forces of change in that country, by example and by contact.
      I do not like reliance on harsh legalism. For example, one would almost have to provide each naval commander with a legal adviser who would say whether or not the firing of a particular salvo is justified in all the circumstances. One cannot have co-operation on that basis, and nobody should wish to impose it.
      If we return to the policies which worked before 1964, so far from helping the imposition of apartheid, we should be doing the precise opposite. We should be strengthening the forces—which are considerable in that country—which

      1803
      recognise the embarrassment which faces them in world opinion and we should be strengthening them by contact, example and argument.
      South Africa, though it is bedevilled by policies which are perhaps more foolish than wicked, can offer a bright future to all its races, who already enjoy the highest material standards of living in the Continent of Africa. Human history shows how often indulgence in attitudes of self-righteous moral indignation, treating whole peoples as untouchables, leads to blood, death, misery and ruin. I pray that this may not be so in this case.
      8.8 p.m.
      Mr. R. T. Paget: From the debating point of view, it is unfortunate that I found myself in agreement with so much of what the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carptenter) said.
      If I may express my own credo, it is this. The principles which have giuded me during the 25 years that I have been in this House lead me to believe that in the dangerous world in which we live, the various and different ideologies must learn to live and associate with one another.
      Living and associating with different ideologies is the first function of foreign policy. Ideological and emotional foreign policy such as that expressed by the right hon. Gentleman the Leader of the Liberal Party is far too dangerous to the world in which we live. Reform must come from within. It cannot be introduced from without. Reform comes to dynamic and not to static societies, and it comes through contact not from segregation. Attempts—this applies throughout the world, whether to China, Rhodesia or South Africa—to stop by embargo or to confine by segregation serve only the kind of policies which one wishes to see ended.
      I am not impressed by the naval argument, though I will not develop it. If Russia is showing its flag, which it undoubtedly is, then that is not something with which we can interfere. If she were to intervene in a local war, we should not dare to intervene, any more than we did when Mussolini invaded Abyssinia or when Nasser invaded the Yemen. If it were the general engagement of a great
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      Power, we should probably have the post mortem interest of a cinder. Our chances of survival would be measured inversely to our capacity to hurt the Russians.
      We are concerned with order, which is a more respectable concern—order in Southern Africa, in a great investment area, in our third biggest trading area, in the area most capable of expansion. I do not believe that this is a disreputable interest. Under international law, the community of nations is obligated to respect the right and to recognise the duty of all Governments to maintain order within their territories—[An HON. MEMBER: "And justice."] No, not justice. That is the concern of the country itself and not of the international community.
      Even when there is imposed disarmament in an armistice by a victorious Power on a defeated Power, the reservation is always made of the right of the defeated to obtain and maintain the arms necessary for internal order and the security of its frontiers.
      We are apparently asking that Her Majesty's Government should forbid the supply of such requirements of internal order by British nationals. I question whether this is legal. To enforce an embargo on the supply of police weapons to a Government with whom we are at peace, being part of a general design to assist armed rebellion and the armed violation of frontiers is unlawful, and it does not become any the less unlawful when it is promoted by the United Nations, an organisation precluded by its constitution from interfering in the internal affairs of its members.
      I hope that, at some time, the Foreign Office and the Attorney-General will consider the general proposition in international law, which is profoundly important. Certainly, this conspiracy against order to which we are parties in Southern Africa is novel in international history. In fact, we have to go back to the reign of Elizabeth I. when the Pope released Elizabeth's subjects from their allegiance, called upon them to murder their sovereign and called upon her neighbours to invade her territory.
      We have recently celebrated the canonisation of 40 martyrs whose opposition in England the Pope's policy had made treason. When we find some pressure in Southern Africa on ministers

      1805
      of religion, we have to remember also that a similar policy by the World Council of Churches has had a similar effect, although certainly the South Africans are being a good deal less rough than were the Ministers of the first Elizabeth.
      This is a conspiracy against order of which we are asked to be part—and just in Africa. We have a Fascist Government in Spain who got there in a terrible civil war. No one really suggests that we should try to reopen that civil war or have nationalist volunteers in Gibraltar to raid across the frontiers. No one suggests that we should do that sort of thing in Czechoslovakia, where much rougher things have happened. Why do we make this assault on one order, that of South Africa?
      After all, it is an order which does not require a wall to hold its citizens in It is an order which has provided services better than any African Government has. It has provided wages for Africans better than those of any other Africans. It has brought into being a population whose very survival depends on the continuation of an effective industrial order. This we are asked to conspire to destroy—to put what in its place?
      There is no African police force to put there, there are no African armed services, there is no African civil service, there is no African alternative Government. All we could put in its place is a sort of new Congo. I can understand that this might be to the taste of the liberals. Heaven knows, humanity has suffered much from liberal idealism. But what British interest would be served by this contrived anarchy I just cannot imagine.
      One interest which apparently would be served is that it would please the Commonwealth. I am in some doubt as to just what the Commonwealth is. It is certainly not an alliance. Most of it would be on the other side. We have had references to the Eight-Power Study Group. When there is a group to study how one is to defend the Indian Ocean against the Russians, it is interesting to know what side it is on. Australia and Canada are certainly on our side, but what about India, if Mrs. Gandhi has to bring the Communists into the Coalition, as seems extremely likely? This seems to be a nonsense.
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      Again, we are told that we can exert influence through consultation. Mauritius grants the Russians naval facilities: she does not consult us. Tanzania enters into armament agreements with China: she does not even tell us. Uganda decides to nationalise 65 per cent. of our investment: she does not even tell us. Yet these people claim the right, on which they insist with the hysteria of spoiled children, of interfering when we are considering our own interests.
      France does not have a Commonwealth. I believe that she is extremely wise. She supplies arms to South Africa if it suits her and there is not a word of protest. She has commonsense agreements with her ex-colonies and expects from them the civility which is due from a beneficiary to a benefactor. We have a similar arrangement with Ireland. How grateful I am that Ireland is not in the Commonwealth and does not have to parade periodically to assail us for our colonialism. Our relations would not be half so good if she did.
      Then we have the United Nations. The first speech that I ever made in the House was on the United Nations and I expressed my doubts then. I pointed out that, unlike the old League of Nations, when the many were much stronger than the one, and in which the many could give effective security to the others, neither Russia nor America had the slightest intention of being coerced. The United Nations was never really designed to be anything except the secretariat of a great Power concert to enforce the will of the great Powers among the lesser.
      It broke down, as I thought it inevitably would, when the victorious allies fell out with each other and began to compete for the favour of the defeated. It was bound to happen and, in my very first speech of 25 years ago, I said that I did not believe that this had any capacity for being a security organisation.
      Nothing since has changed my mind. We have had two phases of the United Nations. The first was when it was controlled by the Americans. Then, the Russians constantly used the veto and we screamed our indignation. Then the United Nations passed into the control of the Communists and Afro-Asians. We were inhibited by our previous screams from voting in our own interests and got ourselves involved in a lot of

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      extremely silly resolutions produced by the Communists and Afro-Asians.
      It has been an astonishing achievement. Czechoslovakia is ignored; Hungary is ignored; the genocidal war in the Sudan is ignored: the slavery in Abyssinia is ignored; the civil war in Nigeria is ignored. All that happens is that there are screams of indignation at the oppression of Gibraltar and Aden. This is the thing which we are up against. I do not think we should be influenced by it. But at any rate the great achievement of this phase of the United Nations—as a public relations exercise it has been quite astonishing—is apartheid.
      Let us think about it. Just a few years ago, until the majority changed, South Africa was a member of the Commonwealth in good repute. She was a founder-member of the United Nations. In a period of some 10 or 12 years. she has been converted into the pariah of the nations by a group of nations whose tyranny is far more severe and whose racialism is far more brutal than anything occurring in South Africa. The Jews of Russia can look with great envy upon the Africans of South Africa, who are free to go to any African country they choose. Having said this, let us look at apartheid a little without this haze of fury which has been built up and to a large degree imposed upon us. After all. South Africa has built-in means of change, and is changing. To that degree, she is a democracy. She is one of the 30 out of the 130 members of the United Nations where opposition is legal.
      The old policy was Baaskap, which was the religious conception that the black man was condemned for all eternity to be the white man's servant. Apartheid—separate development—was the idea that came into being to get away from that. I do not know whether any of my hon. Friends know who the Karl Marx of apartheid was, the originator, the person from whom it was drawn. It was Abraham Lincoln. The reformers—the anti-Baaskap people—in South Africa looked to an alternative and they found it in the writings of Abraham Lincoln. He was murdered before the could put it into operation, so premature integration and the carpet-bagger destroyed the Southern States for a century.
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      But still, as a step between the two, if it were honestly and reasonably applied, there is something to be said for separate development. The things that are wrong with separate development are the cruelty and absurdity of its application in all sorts of cases. Dr. Goebbels would have observed that even a United Nations led by the Russians could not achieve a propaganda triumph without some basis of truth inside it, and there is a great deal that is horrible in apartheid and must be objected to. But it is not comparably horrible with what happens in several Communist countries.
      Mr. Elysian Morgan rose—
      Mr. Paget: No. I do not want to give way. I am going to conclude with a personal story which illustrates what I am saying. My hon. Friend the Member for Poplar (Mr. Mikardo) came to see me one day and asked whether I could help a Jewish boy who had been convicted of taking part in a bomb outrage in which people had been killed in South Africa and had been sentenced, as he would have been anywhere, to a long term of imprisonment.
      My hon. Friend told me about the boy's childhood in the sewers of Warsaw and how terrible it had been. I said that I would do what I could. I got in touch with my right hon. Friend the Member for Cardiff, South-East (Mr. Callaghan), who was then Home Secretary, and asked him whether he would admit the boy if South Africa would release him. I wrote to Mr. Vorster and received in reply a somewhat curt letter saying that my letter had not been expressed in the terms he was accustomed to receiving from members of my party, but he would see what he could do. Within a matter of weeks, I got a green card and up to my room came this boy. Mr. Vorster had gone to see him in prison, had had a long interview with him and had then ordered his release. That sort of thing does not happen in a Communist country.
      I believe that the benefit of South Africa and of the Africans there depends, as the right hon. Gentleman said, upon the dynamism of its economy. As that economy goes forward, apartheid will break down. Those of us who have been there know that it is breaking down and

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      we have seen it breaking down. It will not work in a dynamic, developing society. But one way to keep apartheid working is to prevent that economic development.
      In making British policy, let us learn a little from the French experience. Let us firmly pursue our national interests and have a policy that is ours—not a policy that is given to us by the United Nations or by the Commonwealth. Then we shall be respected, as France is respected, in Africa, and not despised as Britain is despised.
      Several Hon. Members rose—
      Mr. Deputy Speaker (Miss Harvie Anderson): Mr. Brocklebank-Fowler.
      Mr. George Cunningham: On a point of order, Mr. Deputy Speaker. After the disgraceful contorted logic of the speech by my hon. and learned Friend the Member for Northampton (Mr. Paget), would it not be appropriate for you to call—
      Mr. Deputy Speaker: Order. I think that the hon. Gentleman has been here long enough to know that that is not a point of order. It is perhaps necessary to draw attention to the fact that I have called a maiden speaker who has been waiting all day to speak in the debate. Mr. Brocklebank-Fowler.
      Mr. Cunningham: After the speech we have just heard, would it not be appropriate for you, Mr. Deputy Speaker, to call another hon. Member on this side?
      Mr. Deputy Speaker: Order. I have already expressed myself on that matter.
      8.28 p.m.
      Mr. Christopher Brocklebank-Fowler: I rise to ask the indulgence of the House in making my maiden speech. Since the formation of the constituency in 1918, King's Lynn has usually been represented by a member of the governing party. In expressing my delight that the electorate there has continued this custom, albeit by a small majority, I must nevertheless pay tribute to my immediate predecessor, Mr. Derek Page. Hon. Members opposite at least will know that he enjoyed the considerable respect and affection of a large number of his constituents.
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      I hope that the House will also allow me on this occasion to refer briefly to another former Member, Denys Bullard, who represented South-West Norfolk from 1951 to 1955, and King's Lynn from 1959 to 1964. I am sure that the House will remember with pleasure Denys Bullard's rich contributions to agriculture debates in particular, and wish him well.
      The King's Lynn constituency has many features worthy of remark not least the town itself, with its 1,000-year old port and its medieval, Elizabethan and Georgian architecture, which reflect the wealth of the port throughout the ages. Primarily a market town, King's Lynn is now an expanding town, having an overspill agreement with the Greater London Council and offering a first-class environment for industrial expansion. The marshland area of the constituency is notable because almost all of it was reclaimed from the sea by Dutch engineers in the 17th and 18th centuries. Its unique flat landscape and fertile soils, divided by waterways and overlooked by the great wool churches, is the home of some of Britain's finest and most independent horticulturalists, fruit growers and small farmers.
      To the north of Lynn, around the coast, with its marshes and superb sand beaches, lie the resorts of Hunstanton and Brancaster which, together with numerous other coastal villages, are popular centres for family holidays, a wide range of outside recreation and, increasingly, for retirement. Inland to the north and east of Lynn are some of the huge agricultural and sporting estates where, in the 18th and 19th centuries, British agricultural systems were the envy of the world. The tradition of large-scale and scientific agriculture is still very much alive today.
      No description of the constituency would be complete without reference to the royal residence at Sandringham and to William Kent's masterpiece at Houghton, built for Sir Robert Walpole as the country home of the Cabinet of the day. Our first Prime Minister had his political critics, but few could deny that this superb building is a fine memorial and a national treasure.
      Sir Robert Walpole was first elected to represent King's Lynn in 1701, and

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      his family was the main political force in West Norfolk for many generations. Indeed, at one time there were five parliamentary seats in the family's gift in my present constituency. However, in Norfolk we prefer to remember the Walpoles for their motto, "Say what you think", which, though unfashionable in some political circles today, is the first duty of any Member of the House who represents a constituency in Norfolk.
      I am conscious that there are dangers in following that advice in speaking on the subject which we are debating today, but I hope that the House will respect my motives for doing so. I have no financial interests in Africa, but I have enjoyed the privilege of both living in Kenya and travelling widely in East and Central Africa. I still speak some Swahili and I have maintained and developed private friendships with Africans over nearly 20 years.
      I congratulate my right hon. Friend on his determination that our relationship with friends in Africa should be based upon the firm foundations of the law. I hope that this policy will lead to fewer misunderstandings.
      The terms of the Motion raise three important points—first, whether there is a legal obligation on the United Kingdom to supply certain replacements and spares under the sea routes agreement; second, whether there is a legal obligation to supply further arms; and third, whether it is now the intention of the Government at some point in the future to supply further arms to the South African Government.
      On the first two points it is clear—or at least, it was reasonably clear until we had the legal discussion earlier—that Britain's legal obligations under the Sea Routes Agreement, summarised in paragraphs 51 and 52 of the White Paper, require her to supply certain replacements and spares. But it is clear from paragraph 59 that there is no
      "… general and continuing legal obligation on Her Majesty's Government to permit the supply of arms to the South African Government."
      As a layman, I accept those views of the Law Officers in respect of this obligation. I ask my right hon. Friend, in winding up for the Government, to confirm that he accepts all the legal advice
      1812
      set out in the White Paper and that he will undertake to ensure that the South African Government meet in full her legal commitments, especially those relating to employment in the naval base agreement. Will he also ask the Attorney-General to report to the House on the legal status of the South African police presently supporting the rebellion against the Crown by the illegal régime in Rhodesia? lf, as I suspect, their presence in defiance of the wishes of Her Majesty's Government is illegal, will my right hon. Friend insist that they are withdrawn so that the legal niceties are observed in every aspect of our relationship with South Africa? If the Government will accept this advice, I am sure that it will go some way to restoring the Commonwealth's confidence in Britain's integrity and purpose.
      Turning to the third question, I shall now consider the wisdom of exceeding our legal obligations and supplying further arms to South Africa. Undoubtedly such a course of action would cause irreparable damage to the Commonwealth and would undermine our still considerable influence in the third world. The adverse effect on our short and long-term economic interests and the threat to the security of British expatriates are too awful to contemplate. Communism would gain its greatest boost since Suez. Is the marginal strengthening of our bilateral defence capability really worth all this?
      Nevertheless, the rapidly increasing presence of Soviet ships obviously is a threat to the freedom of the seas which cannot be ignored. But, can, or indeed should, Britain and South Africa together assume the total responsibility for the defence of the Indian Ocean and the South Atlantic? To accent this proposition would be to condemn the British taxpayer to paying for forces on an imperialistic scale and would be to the detriment of many of our other interests throughout the continent of Africa.
      Surely long-term and effective defence can be provided on this scale only by an alliance with the United States of America or between all the friendly nations which depend upon the sea routes through these areas and whose countries are vulnerable to attack from the sea.
      The Government have already reconised the value of multilateral cooperation in the Far East. I urge the

      1813
      Government to delay any move to increase the scale of our bilateral cooperation with South Africa until much greater thought has been given to the alternatives.
      The issues underlying the debate have serious and long-term implications for Britain's interests. Rather than reacting quite so quickly to pressure from the South African Government, surely we ought to make a more catholic assessment of where our interests really lie. We must raise our sights to consider the prospect of real partnership with Africans in their desire for equal rights and economic expansion. If we will support them, the ties of language and affection can ensure our access to a vast expanding market for both investment and trade which may yet be vital to our own economy.
      We should also remember that Communism is as alien to Islam and to the African tribal tradition as it is to us. It flourishes in Egypt, not through lack of British arms, but because Britain was slow to accommodate the aspirations of the Egyptian people. One is entitled to ask: will Britain ever learn?
      8.40 p.m.
      Mr. Michael Stewart: I have great pleasure in congratulating the hon. Member for King's Lynn (Mr. Brocklebank-Fowler) on his maiden speech. It was a speech most elegant in form and most pertinent in content to the subject of our debate. It enabled him to live fully up to the motto, "Say what you think", and if he were more loudly applauded by his hon. Friends when he stood up than when he sat down, he has at any rate the consolation of knowing that he has said what he thinks and that what he thinks is very much to the purpose.
      I share his feeling about the legal arguments which we have heard. I suppose that if any one of us were asked to pronounce a judgment, having heard the Attorney-General and my right hon. and learned Friend the Member for West Ham, South (Sir Elwyn Jones), it would be said of any one of us that our judgment was politically prejudiced. I believe that if someone who had never expressed or formed any opinion on this matter had heard that argument he would be bound at the very least to consider that if there
      1814
      were a balance of legal argument one way or the other it was extremely tenuous.
      It is on this tenuous platform, even assuming that the tenuous balance is the Government's way, which I do not admit, that the Government erect a policy involving something far more than legalism, a policy that has grave moral implications and very great political implications for this country, for the Commonwealth and for Britain's position in the world. Most remarkable of all—and we are grateful to the hon. Member for King's Lynn for rubbing this point in—it is still necessary to ask the question whether the Government's policy is to go further than their legal obligations.
      If we read the mere wording of the Amendment, the Government are resting themselves only on the legal obligation. Can we have quite expressly what the situation is? Is the Government's intention to supply arms to South Africa strictly limited to the legal obligations as defined in the White Paper? The extraordinary thing is that we still have to ask this. This ought to have been made clear long ago. The Foreign Secretary made a speech, but at the end of it the question was still unanswered. We ought to know before the debate comes to an end. If the answer is that the Government are to go no further than their legal obligations, then that is very different from the impression which the Prime Minister was giving to the South Africans some months earlier.
      Another legal point touched on by the hon. Gentleman, which if we are to argue the issue legalistically ought not to be ignored, has to do with the position in Rhodesia. Since it cannot be in dispute that the South African Government are actively supporting a régime in rebellion against the Crown, are we under a legal obligation to go on supplying arms to them? I believe I am right in saying that all contracts about the sale of arms can be interrupted for grave reasons of State.
      I should like to know whether there is a precedent for our allowing a country supporting a rebellion against the Crown to purchase arms in this country. I do not pretend to know the legal answer, but surely it is a question which ought to have been put to the Law Officers. It has not been put to them. Have the Government taken any legal advice about this

      1815
      or did they just forget the matter in their hurry to make some pronouncement about the sale of arms to South Africa?
      It is remarkable, throughout the progress of this affair, since the Government came into power, to see the extent to which they have used arid legalisms and dry expressions of principle which have no flesh and blood to hide the monstrous nature of the thing they were doing. The Prime Minister's description of the Government's policy began with a solemn assertion that each independent Commonwealth country has the right to be the judge of its own interests and to do what it feels is in its own interests. As a legal principle, that has not been disputed. The question is this: is what the Government propose to do right or wise?
      No one questions that they have a sovereign right to do it. Under the law of the country, a man has a legal right to commit suicide, but only a fool demonstrates his independence and sovereignty by doing so. The Government have confused what we have a legal right to do with what it might be wise and right to do. We are arguing about what is wise and right, and the Government try to thrust this into a legal, constitutional straitjacket. It is the same with this long argument about the exact nature of resolutions at the United Nations, ignoring the one simple fact that this country is a permanent member of the Security Council. If a resolution is going forward there which we are convinced we either cannot practically or in honour carry out, our duty is perfectly clear, namely, to use our power to prevent it from being passed, to explain why, and to bear such odium as may come from using the veto. What is not excusable is to let it go through, pretend we are keeping it and hedee it round with reservations which mean that we are dodging that responsibility. That is what the Government have done.
      My hon. and learned Friend the Member for Northampton (Mr. Paget) does not think very much of the United Nations, or, for that matter, of the Commonwealth—or, as far as I can gather, most of mankind.
      Mr. Paget: They are two not very successful organisations.
      Mr. Stewart: What my hon. and learned Friend should grasp is that an organisation whose job is to try to keep mankind at peace will not be successful in its early stages. It will probably be about as effective as this Parliament was when it was first assembled seven centuries ago. It was then no good trying to pass laws by a majority vote and expecting them to be obeyed throughout the country, but one could get the great and powerful to see a bit further than the ends of their noses where their common interests lay.
      That is what we must try to do in the political work of the United Nations. We shall not do it by dodging about and playing with the legalities of resolutions in the way in which the Government have done over the question of arms for South Africa.
      My hon. and learned Friend the Member for Northampton does not think much of the setting up of the eight-nation group. Presumably the Government do, otherwise why did they set it up? We are told, as if it were a matter of pride, that the Prime Minister gave no pledge that he would not sell arms to South Africa before the eight nation group had finished its work. Was the determination to sell arms to South Africa and making a statement to that effect before the eight nation group had finished its work a right or sensible thing to do? Why was the group formed? Presumably because the Government thought that the common counsels of these nations would be of service in framing defence in the Indian Ocean.
      Apart from any pledge which the Prime Minister did not give, anyone with common sense must have know that to announce a decision to sell arms to South Africa before the group had finished its work was an insult to it and must have known that this would be the effect. Better not to set up the group than to do it in order to palm this gratuitous insult on it. We are told, "It is all right because the Prime Minister did not promise that he would not do it", as if a refusal by the Prime Minister to promise to do good is a subsequent justification for his doing any kind of mischief that he can lay his hands on.
      But beyond that there is the great politico-moral issue to which many speeches have been addressed. We do

      1817
      not dodge it by pointing out that there are many tyrannies in the world and that we must put up with them and co-exist with them. But it is a new doctrine that because we have to co-exist with various régimes it is either logical or wise to supply arms to them. Much as we deplore many aspects of Communist tyranny, we accept that we must co-exist with Communist countries. Nobody, however, argues that because one believes in co-existence they therefore have logically a right to obtain arms from this country. Yet that has been the argument advanced by some speakers about South Africa tonight. The right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) said that because under the last Government there was a substantially peaceful trade between South Africa and this country, it was therefore logical for us to sell arms to South Africa. Would anyone accept that logic in relations between this country and the Communist world?
      Further, it is suggested that we shall somehow make the South African tyranny better if we allow the South Africans to buy arms in this country. It was argued that if they are increasingly boycotted and put in a corner they will get worse. Hon. Members opposite were putting forward that argument and at the same time saying that South Africa has been boycotted, attacked, put in a corner, and that her régime is getting better and better all the time. Both those statements, mutually contradictory, have ben advanced on the other side of the House.
      As to whether the savageness of apartheid is relaxing—well, witnesses come, witnesses of our own nation and of our own religious faith, one by one from South Africa telling us what is inevitably the story of the tyranny of a people who begin by tyrannising over another race and have to end up by tyrannising over their own race. That is what is happening in South Africa.
      It does not answer the point to say that there are worse tyrannies elsewhere, because this tyranny, and this particular form of tyranny, occupies a key position in the world at the present time. The new nations of Africa, preoccupied with their own problems, none the less cannot avoid feeling that the one great question for Africa is this: is apartheid going to
      1818
      come to an end or is it going to spread—in South Africa and the Portuguese colonies and Southern Rhodesia? That will be the greatest international question in their minds, and what the British Government, by their present policy, are saying to all Africa is, "On this great question Britain is ranging herself on the wrong side." I do not believe that there is any getting away from that.
      I visited Nigeria early this year, a country where there is great affection and regard for Britain. I remember being among a group of people, some British, some Nigerian, and the conversation turned on this question which we are debating tonight. One of the British in the company put the perfectly fair question to a Nigerian, "Why do you make so much fuss if we sell arms to South Africa when you know perfectly well that other European countries do it?" The Nigerian's answer was, "If my brother does me a wrong I feel that more than if it is done by a stranger who has no similar obligations to me." That is the feeling, the potential good will, which this Government are doing so much to outrage. They will enable every Russian, every Chinese, propagandist in Africa—and there are quite a number—to say all the time, "You may not think very much of us, but this is a vital question with which you are concerned of racial equality, and which side are the British on?"
      We have had pictures of the danger of Communism to the liberties of mankind. It has never been a danger which I have overlooked or underestimated, but what we are arguing about is this: is the British Government's action increasing or diminishing that danger? Does not the history of the year 1939, and of the years preceding it, show that if we try to hold off this danger by getting on tolerable terms with unspeakable tyranny we shall defeat our own ends? It is an extraordinary thing that in the years since the end of the First World War there have been, in my judgment, so far two major errors of British foreign policy. One we associate with the word "Munich" and the other we associate with the word "Suez".
      Both policies were intended to contain Communism and to reduce its influence in the world, but both in the end had the opposite effect. There is a further

      1819
      similarity. Both policies were pushed through by an obstinate, opinionated Prime Minister against a great weight of informed opinion and against the conscience of humanity. If the Government get through this policy, this will be the third error, resembling the others in all those respects.
      8.55 p.m.
      Sir Frederic Bennett: In the last few moments we seem to have returned to the note of Opposition high moral fervour with which the debate began, and with which I have no doubt it will end so far as the Opposition Front Bench is concerned. The right hon. Member for Fulham (Mr. Michael Stewart) seemed to be criticising us because, unlike him, we thought that co-existence meant that we should supply arms. That is precisely what his Government did, but in a more limited range. If the right hon. Gentleman thinks that it is immoral to supply arms for the sake of co-existence, does he think it moral to have joint manœoeuvres in which British sailors are put under South African admirals in the South Atlantic? Where does the line or morality go? The one message above all others that should go from the Chamber tonight is the unbelievably hypocritical effrontery of the Labour Front Bench, and most of all of the right hon. Member for Leeds, East (Mr. Healey) who is to wind up. I have time to give only two examples.
      During the period after 1965 there was a continuing supply of some arms, some directly, some under licence, and some in conjunction with the French. The arms supplied in conjunction with the French were of far more use in enforcing apartheid than anything we are now considering. Reference has been made to the unlimited number of handcuffs which have been sold to South Africa in the last few years. Are not they sometimes possibly a little more useful in a repressive State than three or four helicopters? What about the land rovers with which the police forces and armies in South Africa are equipped and for which unlimited licences were given by the Labour Government? I do not object to the Labour Party's practical outlook, but I do object to this extraordinarily shabby white sheet which they adopt.
      1820
      Then there is the arrangement for joint exercises, some of which were pending when my Government took office last June. Such exercises have taken place over and over again, often not known to back benches opposite, in which British sailors and British ships combined closely in joint naval exercises with only one purpose in mind—what we might need to do in a war against some foe, with South Africa on our side and with British sailors placed under South African command.
      Right hon. Gentlemen opposite adopt a moral attitude in which it is all right to have joint manoeuvres with the South Africans, and it is all right to put British sailors under apartheid-minded admirals, provided that they are on ships supplied by another power such as France. Where is the moral? If the sailors are in a British ship that becomes immoral, but if they are in a French ship it is all right.
      The right hon. Gentleman will not be surprised if I ask him to clear up a point that has been troubling many of us for a long time. It refers to the memoirs of his noble Friend a former Foreign Secretary. I wish I had time to read more of it.—[Laughter.] I will gladly read the whole passage if it will please hon. Gentlemen. Lord George-Brown was saying that:
      "The arms in question included Buccaneer aircraft and other items of mainly naval equipment such as frigates for South African defence and the implementation of the Simonstown Agreement between us and the South Africans. I did not see how the argument could be sustained that the sort of arms and equipment which the South African Government was anxious to obtain from Britain could really be said so to jeopardise the position of black South Africans as to make it wrong for us to be willing to supply."
      He went on to say:
      "Mr. Healey and myself, who had jointly submitted the original memorandum and recommendation, and those others who were originally in favour of supplying these limited arms, had become a pretty small minority, and we were no longer able to carry our colleagues with us."
      Will the right hon. Gentleman say once and for all tonight whether his colleague Lord George-Brown is telling the truth? If he is telling the truth, then if ever there were an example of Satan rebuking sin, it is what we are about to hear.
      Mr. Deputy Speaker: Mr. Healey.
      Mr. Healey: On a point of order. This is a Supply Day, and since the House is debating a Motion put down by the Opposition, is it not the duty of the Opposition to open and close the debate?
      Mr. Deputy Speaker: Order. This is not a matter for the Chair, as I am sure the right hon. Gentleman must realise. If the matter continues in dispute, I have no option but to put the Question.
      Mr. Peter Tapsell rose—
      9.2 p.m.
      Mr. Denis Healey: If the Government want to have the last word in this debate I shall be delighted to let them have it. In any case, the sooner I can speak the better for the House and, in particular, for Her Majesty's Opposition.
      I join with all other hon. Members in congratulating the hon. Member for King's Lynn (Mr. Brocklebank-Fowler) on his remarkable and courageous maiden speech. I say this without the slightest intention of damaging his political prospects in the future. It was noticeable that many of his hon. Friends, who must have disagreed with what he was saying, were most impressed by the manner in which he said it. I know that the whole House will welcome the combination of courage, wisdom and experience which he showed. I have no doubt that on many future occasions I shall find his views less palatable than I found them today.
      This debate has been to some extent unsatisfactory since we are still uncertain about what is the precise policy of the Government on arms to South Africa. The Opposition's Motion, whether hon. Members agree with it or not, is clear, unequivocal and wide-ranging. The Government have put down an Amendment which is extremely narrowly drawn.
      When the Foreign Secretary opened his remarks he indicated the intention of confining himself largely to his own Amendment as drafted. Yet within a short time he had been triggered off into fantasies about the Red Navy in the Indian Ocean very similar to those with which he regaled us in July. A moment or two later he was robustly asserting once again, as he had in July and on similar occasions since, the right and intention of Her Majesty's Government to supply any arms to South Africa at any time in a form
      1822
      which, in the opinion of Her Majesty's Government, would help them to carry out their part in checking the threat of the Soviet Navy to the trade routes round the Cape whether or not they were legally obliged to provide those arms. If that is the Government's policy, the Amendment which they have put down for debate is hypocritical and misleading.
      In the gratuitous interventions which the Prime Minister made in the speech of the Leader of the Liberal Party, the right hon. Gentleman went a great deal further even then the Foreign Secretary. He said that, as Prime Minister, he maintained exactly the same position as that which he had adopted when he was Leader of the Opposition in the debate in the House on 16th December, 1967. No doubt like many other right hon. and hon. Members, I have taken the trouble to refer to what the right hon. Gentleman said on that occasion. He committed himself to supporting the sale of £200 million-worth of arms to the South African Government. One of his arguments was that this would be necessary to prevent the French Navy acting in South Africa in the same way as the British Navy. I hope that the Minister of State will say tonight whether it is the policy of Her Majesty's Government to supply arms on this scale and for this purpose, among others.
      There was at least one comment that the Foreign Secretary spared us. We heard nothing of that hobgoblin of Conservative mythology, the Russian harbour master in Aden, with whom the Prime Minister has been regaling journalists and foreign politicians for the last nine months and who turns out to be an inoffensive Indian lent to the South Yemen Government by the Indian Government.
      However, we had from the Foreign Secretary—it was echoed by the hon. Member for Torquay (Sir F. Bennett)—the same story about Puma helicopters. But it was very different from that which the Foreign Secretary put to us about 10 days ago. Then, relying unwisely, as his right hon. Friend the Chancellor of the Exchequer could have warned him, on a story by Mr. Chapman Pincher in the Daily Express, the Foreign Secretary told us that the Labour Government when in power had not protested against the sale of these helicopters. He now

      1823
      knows that that is not true. He knows that, when we were consulted on the sale, we said that we were strongly against it and that it was quite contrary to the policy of the Government but that, as I told him last week, we were not in a position to prevent the sale because, under our agreement with the French Government for the production of three helicopters, we were unable to get a common consent clause about sales for a helicopter which was 80 per cent. produced by France.
      The Foreign Secretary made one point which he has made before, and it was well answered by his hon. Friend the Member for King's Lynn. Once again the right hon. Gentleman pointed out that the Soviet fleet in the Mediterranean presents more of a threat to the West today than it did four years ago because, today, the Soviet Union has military aircraft in Egypt. That is perfectly true. But why are there Soviet sailors, soldiers and airmen in Egypt? No one knows the reason better than the Foreign Secretary himself. In 1956, a Conservative Government, in the mistaken belief that they were protecting Britain's interests, acted against the advice of all our friends in the Commonwealth and all our allies except one and used force to secure those interests. With one bound, as a result, the Soviet Government were established as a major political influence in the Middle East and as a major military power. They have never looked back since that day.
      The other achievement at Suez which is relevant to the issue which we are discussing today is that, in one stroke, a Conservative Government destroyed a position of paramount influence in the Arab world which it had taken 50 years to build. That, incidentally, led directly to the assassination of Britain's best friend in the Arab world, Nuri-as-Said.
      I ask the Foreign Secretary, who knows a great deal about these matters, to consider whether there is a danger of that situation being repeated if the Government are not prepared to tell us tonight that they will not go beyond what they regard as their legal obligations in selling arms to South Africa. Nobody who followed the agony of the Singapore Conference—no one followed it more closely than the right hon. Gentleman—can have the slightest doubt about the conse-
      1824
      quences for the Commonwealth, for Africa and, as the hon. Member for King's Lynn pointed out, for British lives and property in Africa if the Government persist in their present policy.
      The Foreign Secretary was not at his best in speaking earlier this afternoon, and he has not been at his best at any stage in this long tragedy of Tory policy in South Africa. I thought that the right hon. Gentleman was at his best in Singapore, because, from many reports in the Press and many reports which I received privately, it appears that he worked like a Trojan to try to get the Prime Minister off the hook on which the Prime Minister had impaled himself.
      The right hon. Gentleman was responsible for persuading the Nigerian Government—I ask him to deny this if it is untrue—to put forward the proposal for an Eight-Power Study Group to consider security in the Indian Ocean. The right hon. Gentleman did a great deal at that Conference to limit the damage created so far by Government policy. I deeply regret that the right hon. Gentleman has not had the courage to carry his conversion through and to make it clear to his colleagues and to the House that enough is enough and that it would be disastrous for Britain's interests if we were to carry the sale of arms to South Africa one inch beyond the legal obligations as the Government have defined them.
      I must now say a word or two about the legal obligations, because much of the Government's case so far hangs on the Attorney-General's White Paper. However, from what the Prime Minister and the Foreign Secretary said this afternoon, the legal argument, as my right hon. Friend the Leader of the Opposition said, is irrelevant. It is quite clear that the Government are not standing on the legal argument; they propose to go ahead and sell whatever arms they think fit to the South African Government whether or not there is a legal obligation under the Simonstown Agreement to do so.
      There are two great merits in the Attorney-General's White Paper. First, it throws some light on the degree of candour with which the Prime Minister is prepared to treat the House, the country and the world.

      1825
      The Prime Minister, in his Guildhall speech, said:
      "Under the Simonstown arrangements we have an obligation to supply to South Africa the maritime equipment she requires to fulfil her side of the Agreement."
      The right hon. Gentleman elaborated that, when he spoke at a Press conference a month later in Ottawa, by saying:
      "Under that Agreement we have the obligation to supply arms for maritime defence to South Africa."
      The right hon. Gentleman made no attempt to qualify those statements; he gave everybody the impression—deliberately so—that there was no limitation whatever under that Agreement. Yet we now know from the White Paper, which we understand from the Attorney-General is accepted in toto by the Government, that, as paragraph 59 makes clear, there is in fact no
      "continuing legal obligation on Her Majesty's Government to permit the supply of arms to the South African Government."
      Another very valuable service has been done by the Attorney-General's White Paper. It showed, and gave chapter and verse, what scrupulous care was taken by the Labour Government to carry out the United Nations embargo, subject only to the inherited commitments which were legally binding on the Labour Government when they came into office in 1964.
      The hon. Member for Torquay and other hon. Members have tried to make out that in carrying out our minimal legal obligations under Simonstown we in some way behaved exactly as badly as the present Conservative Government plan to behave. In his speech at the Singapore Conference, which was published, President Nyerere said on this question:
      "… we are very well aware of the problems of inheritance. African states themselves inherited many Agreements which they have since regretted but have not felt able to renounce.… It would therefore be unrealistic for us to complain, in 1970 or 1971, about Britain fulfilling the minimum of engagements with South Africa which she undertook in 1955. What we do expect, however, is that a government inheriting obligations which are contrary to its interests in changed circumstances. will do the minimum it is obliged to do, and will endeavour always to lift these obligations from its back."
      Those are wise and very moderate words. That was the feeling of all the
      1826
      African Governments with which the Labour Government were in communication for the six years from 1964 to 1970. I think that members of the Government Front Bench at any rate understand that there is a basic political difference, and difference of principle, between doing the minimum that one is committed to do by inherited obligations and accepting an unlimited political commitment, irrespective of all one's legal obligations, to do a great deal more and to do things which are regarded by the African members of the Commonwealth with exactly as much repugnance as Jews in the 1930s would have felt about the supply of arms to Hitler.
      Mr. Peter Rees: Since clearly the right hon. Gentleman's Administration attached so much importance to their minimum obligations, did they ever ask their Law Officers what the precise scope of those obligations was? Will the right hon. Gentleman tell the House what advice he received?
      Mr. Healey: This was done earlier by my right hon. Friend the then Prime Minister and my right hon. and learned Friend the then Attorney-General, and I am just passing to this point.
      The whole case made by the Attorney-General boils down to his opinion that the Government are obliged to supply eleven helicopters as the complement for three frigates. He rightly said that the Labour Government admitted the need to supply Wasps for the three frigates, and they did so in 1966. But in the Labour Government's opinion that concluded their obligations under the Simonstown Agreement. The right hon. and learned Gentleman argues that that did not conclude their obligations for two reasons: first, because the four Wasps supplied in 1966 were not intended for the Simonstown frigates, and, second, because the complement for the three frigates was 3½ each, making 11 in total.
      These are matters of opinion, not of law. The right judgment here depends not on law but on knowing a little bit about the facts and about naval practice. The four Wasps supplied in 1966 were supplied for the Simonstown frigates. They would not have been supplied otherwise. I have very good authority for this. A letter, of which I was sent three

      1827
      separate drafts by the Defence Department in December and as late as last night, makes it absolutely clear. The second draft, reference MO 6/1 dated 11th December, 1970, says of the four helicopters:
      "Subsequently a letter from the Foreign Office … explained that these helicopters were being supplied because they were regarded as integral parts of the anti-submarine equipment of the frigates which had already been supplied as part of the Simonstown Agreement."
      That is the view of the Ministry of Defence under the Conservative Government. [Interruption.] I am referring to the second draft sent to me on 11th December. The Government were obviously embarrassed to know that the Ministry of Defence took a different view, so last night they sent me a further letter—[Interruption.] It was not sent in confidence. There is no inscription on it. I assure the Under-Secretary, the hon. Member for Saffron Walden (Mr. Kirk) of this and he can see the letter if he wishes. The letter I received last night put it rather differently, and said that the
      "letter of 9 March 1965 … explained that in reaching their decision … H.M.G. had taken account of the fact that these aircraft were integral parts of a complete antisubmarine weapons system supplied to South Africa under the Simonstown Agreement".
      There is no question whatever that those four helicopters were part of the Simonstown Agreement, and that was the view of the Ministry of Defence.
      When we are asked why they were supplied before all the frigates had been converted, the answer is simply that one cannot train helicopter crews and the people who must operate this sophisticated anti-submarine equipment without practice. These helicopters would have been used before the conversions were completed, and they were so used, to provide anti-submarine defence for Simonstown from land bases. The Minister could easily have checked that with the Ministry of Defence if he had bothered to do so.
      All the rest of the right hon. and learned Gentleman's case is that we were obliged to supply more than four helicopters because there was a higher complement. This is a question not of law but of naval judgment. Nevertheless, what are the facts? It is quite clear that
      1828
      the South African Government regarded the four that were supplied as the complement and the initial reserve for the three Simonstown frigates because in 1967 they asked for four more, and not eleven more, to be delivered between 1971 and 1973. Indeed, the last of those four would not have been delivered until the frigates had been at sea and operating for four years.
      What is absolutely clear is that those for which they asked, and for which they are asking now, are not the initial complement and reserve for the Simonstown frigates but are intended as replacements for helicopters which perhaps crashed or became worn out, and we have no obligation to supply replacements for those. We warned the South African Government years ago that we should not supply any helicopters to replace those which wore out. We warned them of this in 1965, and this is in the letter which is in the right hon. and learned Gentleman's White Paper. He should read his own White Paper, even if lie does not consult the Minister of Defence.
      The Attorney-General: The right hon. Gentleman said that the Labour Government had warned the South African Government. Earlier he said that some information had been given in 1967. It does not appear that anything was heard until 1970. Is he saying that it took three years for them to send such a message?
      Mr. Healey: I am saying that the right hon. and learned Gentleman did not bother to find out that when Admiral Bush went to renegotiate the Agreement at the beginning of 1967, he told the South African Government that Her Majesty's Government would not entertain their shopping list, and this was confirmed in writing at the beginning of 1968. These details do not appear in the White Paper, but I am not responsible for the document. The right hon. and learned Gentleman is responsible for that.
      I simply add my plea to that made by my right hon. and learned Friend the Attorney-General—[Interruption.] I should, of course, have called him the former Attorney-General. I am being a little premature. I support his plea, on the legal question, that if there is a genuine dispute between the two Front Benches—in so far as I could understand

      1829
      the arguments adduced by the present and former Attorney-Generals, there seems to be a dispute—cannot the matter be referred to the Judicial Committee of the Privy Council for decision? This has often been done in the past. I have no doubt that the present Attorney-General is quite as distinguished a legal luminary as Sir Reginald ManninghamBuller, but it happened to Sir Reginald Manningham-Buller, and he was found to be wrong, and I do not see why we should not try the same again.
      The Attorney-General: In fact—I do this in loyalty to Lord Dilhorne—as hon. Gentlemen might not know, Sir Reginald Manningham-Buller was in a minority of one in the Select Committee—
      Mr. William Hamilton: He always was.
      The Attorney-General: Hon. Members had better wait. When the Judicial Committee reviewed the decision it supported Sir Reginald Manningham-Buller, who was in a minority of one, and said that he was right and everyone else was wrong.
      Mr. Healey: For the right hon. and learned Gentleman's sake, I only hope that he has the same experience and that he is prepared to submit himself to the same test. This is all we ask for. Whatever may be the legal situation here, nothing can excuse the way in which the Government actually reacted to the White Paper. They had set up this Eight-Power Commonwealth Study Group. They might have waited until it had met. They might have waited for the South African Government to ask for helicopters. Instead, they sent a telegram immediately to the South African Government. They took the initiative and said, "You can have eleven helicopters. Do you want them?". Greatly to their disappointment, the South Africans said, "No, we only want seven ". So much for this complement argument.
      They did this the very week that the Church in South Africa was undergoing an all-out attack from Mr. Vorster. They did it the very week that the South African Government were conspiring in Salisbury with rebels against the British Crown to put forces into British territory against the express wishes of the British Government. And they did it as their
      1830
      first contribution to the International Year Against Racial Discrimination.
      It is not surprising that Mr. Vorster now regards the present Prime Minister with almost as much affection as he regarded Hitler 30 years ago—[HON. MEMBERS: "Withdraw."] It is not surprising either that members of the Commonwealth, Ministers who have publicly stated their view in Singapore that they would not participate in the Eight-Power Study Group if the Government took a decision before it had met, have now told the Government that they will not participate.
      But there is still some way to limit the damage. I appeal to the Minister of State, who is about to reply to the debate, to make it clear to the House and the country that the Amendment which the Government have chosen to put on the Order Paper represents the extent of the Government's present ambition as regards arms sales to South Africa. If they will do so, many of us on this side and millions throughout the world will feel that it is at least a cheap way of escaping from catastrophe.
      But if the Government are unwilling to give this pledge, if the Minister takes the line taken by the Prime Minister in those unguarded interventions this afternoon, then I fear that the consequences for Britain, for our interests in Africa, for our interests in Asia, for our good name in the world, for the lives and property of our fellow nationals, will be catastrophic. And the responsibility will lie on one man—a Prime Minister who is neurotically obsessed with the need to prove that he is a man.
      9.30 p.m.
      The Minister of State for Foreign and Commonwealth Affairs (Mr. Joseph Godber): We have had a somewhat complex debate. The right hon. Member for Leeds, South-East (Mr. Healey) chose to raise a number of scares which I shall deal with, but first I join him in paying tribute to my hon. Friend the Member for King's Lynn (Mr. Brocklebank-Fowler) on his maiden spech. It was well delivered. There may have been parts of it with which I did not wholy agree, but it was a courageous speech and I gladly acknowledge it. We look forward to his further contributions with great interest.

      1831
      The Motion uses some very extravagant language. It bears the clear stamp of the right hon. Member for Leeds, South-East. The Government Amendment, by contrast, is simple and straightforward and brings us back to the issue before the House.
      Mr. Harold Wilson: No.
      Mr. Godber: It is no good the Leader of the Opposition shouting "No". If he will exercise a little patience, I will explain to him in due course. His and other speeches ranged widely and I wish to comment on some of these matters. I want to analyse the situation as I see it and to try to clarify the issues from some of the nonsense and cant we have heard from the Opposition.
      My right hon. and learned Friend the Attorney-General has already spelt out the legal position clearly in his intervention. Hon. Members opposite have tried to cast doubt on our legal obligations but they have failed to undermine the logic either of the White Paper or of what my right hon. and learned Friend said. It is a pity that the last Government did not go to the same pains to set out their legal obligations when they were responsible. The right hon. and learned Member for West Ham, South (Sir Elwyn Jones) has said that he himself was consulted, and we accept that he was. He suggested that it was not always customary or necessary to have formal opinions. Nevertheless, the legal opinion set out by my right hon. and learned Friends has been of real help in directing people's minds to specific issues as we see them.
      Sir Elwyn Jones: Would the right hon. Gentleman mind answering a question which has always interested me? Was a formal legal opinion sought before the invasion of Suez?
      Mr. Godber: The right hon. and learned Gentleman must be very hard up for ammunition if he is trying to distort the issue in that way. It does not help towards clarification. This is not a comparable situation at all and his intervention is an indication of the barrenness of the Opposition's arguments.
      To me, as a lay man, the strong impression left, after reading various communications from the last Government
      1832
      to the South African Government, as set out in the annexe to the White Paper—
      Mr. Harold Wilson: It is not all there.
      Mr. Godber:—is that, from 1964 onwards, they sought by degrees to wriggle out of the commitment to honour undertakings under the Simonstown Agreement. Late in 1964 and in early 1965, there were attempts to reassure the South African Government that the undertakings would be honoured. In particular, the terms of a letter of 9th March, 1965, with reference to the Westland Wasps, were very specific. But after that, the position rapidly deteriorated until we come to the very negative Aide-Memoire of 5th March, 1970. That was the first statement which the right hon. and learned Gentleman was able to call in evidence in support of his claim that a declaration had been made that only these four helicopters were going to be supplied. We asked him repeatedly and he could give no earlier date. I find it difficult indeed to accept that it would take all that time to come to such a decision. It is clear that the party opposite, when in power, were seeking all the time to wriggle away from their obligations. It was only in the early months of 1970 that they really spelled them out in the form of the Aide-Memoire of 5th March, 1970. That is the position.
      Mr. Healey: I dealt with this point. One of the difficulties in which the Government have found themselves is that they appear to be totally unaware that the request for four helicopters in 1967 was refused in 1967 verbally and at the beginning of 1968 in writing. There was a further request for helicopters at the end of 1969 which was refused in 1970. That is the further request, not made until 1969, which is the one referred to here.
      Mr. Godber: I am coming to the right hon. Gentleman's point regarding his quotations and letters. I want to make clear what the position is, as I see it. In so far as his intervention was directed to the points he was trying to make during his own speech in regard to the letters from the Ministry of Defence, I found it strange when he told the House, first of all, that none of these letters was marked "Confidential". The copy which I have of the letter from which he quoted,

      1833
      dated 11 th December, says in the last paragraph
      "I should be grateful if you would treat this in confidence."
      Those are the words in the letter. However, what is much more serious and what the right hon. Gentleman cannot get away from is that in the letter last night, which he admits he received, he was told that the facts were not given correctly in the letter of 11th December, and yet he chose to quote from the letter of 11th December. If that was not an attempt to mislead the House, I do not know what is.
      Mr. Healey: The right hon. Gentleman has accused me of attempting to mislead the House. Is this in order? If it is, may I refute this terminological inexactitude?
      Mr. Godber: The right hon. Gentleman was quoting from the letter which referred specifically to four helicopters. The letter which he received last night said clearly that the word "four" should not have been there.
      Mr. Healey: I did not quote it.
      Mr. Godber: The right hon. Gentleman did not quote the word "four" but he quoted the arguments related to the word "four", because he was basing himself on the supply of four helicopters. The purpose of the letter last night was to say that the undertaking was not limited to four helicopters. It is no good—[interruption.]
      Mr. Clinton Davis: On a point of order, Mr. Speaker. Is it in order for a Government who come to the House on this issue with unclean hands to allege fraud against my right hon. Friend?
      Mr. Speaker: That is not a point of order.
      Mr. Godber: I make the point perfectly clearly that the right hon. Gentleman was quoting from a letter which he knew had been corrected and he made no attempt to tell the House that it had been corrected. He did not say that the letter he quoted from was specifically said to have given facts not accurately and was in confidence. So it is clear that the right hon. Gentleman rested his case on a false point.
      Mr. Harold Wilson: On a point of Order, Mr. Speaker. We want to hear the right hon. Gentleman's speech—[HON. MEMBERS: "Then sit down!"]—If you would now rule, Mr. Speaker, that the right hon. Gentleman, having quoted part of an official document, must lay it on the Table, we should be able to hear him.
      Mr. Speaker: I think that the right hon. Gentleman was summarising what was in the document.
      Mr. Godber: The first quotation came from the right hon. Member for Leeds, East. If he likes to lay his copy of the letter on the Table, I will be very happy to lay mine. That should clear up the position without any doubt.
      I move on to the question which has been the basis of so many speeches today, namely the question of the moral case. It has been said today that the very enactment of apartheid is such a moral outrage that any legal arrangement with South Africa should have been abandoned when apartheid was adopted and that Britain therefore is entitled to ignore legal obligations of this kind.
      I do not accept that thesis, although I can understand the feelings of those who advance it. But nor did the previous Government accept that thesis. If they had accepted it, they would have repudiated the Simonstown Agreement and they would have said that, irrespective of Britain's needs, they would have nothing more to do with South Africa in the context of defence. But the previous Government did not do that. They said that they
      "attach importance to the Simonstown Agreement and regard it as still in force."—[OFFICIAL REPORT, 6th February, 1968; Vol. 758, c. 232.]
      Those are the words of the Leader of the Opposition. I think that the previous Government were right to do that, but I think that they should have honoured their side of the bargain.
      Mr. Harold Wilson: We did.
      Mr. Godber: My point is that a moral judgment cannot afford to be selective. I yield to no one in my abhorrence of apartheid—[HON. MEMBERS: "Come off it."] Most certainly. But there are other countries whose internal activities I also find very distasteful, and I have never thought that Britain could base her

      1835
      foreign policy on her attitude to the internal politics of other States.
      In my view, the only way in which a moral judgment could be properly invoked in regard to the supply of arms to South Africa would be if those arms could be shown to be directly related to the enforcement of apartheid. There are those who have attempted from time to time to say that this is the case, even with such limited a uantities as we are now discussing, but I reject that argument as absurd. It has been argued that a helicopter supplied for one purpose can be used for another. Why on earth should the South African Government bother to do this with a few Wasp helicopters when we know that she has ample supplies of other helicopters supplied by other nations against whom the moralists either here or elsewhere have scarcely bothered to breathe a word of protest?
      The Opposition have made a great deal in this debate of the possible effect of our decision on other African countries and on other members of the Commonwealth. One of their main arguments appears to be that, whatever justification there may be for the supply of these very limited quantities of arms, we ought to have delayed announcing any decision to supply them until the Commonwealth Study Group had reported.
      In this respect no one could have been at greater pains to explain Britain's decision in this matter, particularly to Commonwealth countries, than my right hon. Friends the Prime Minister and the Foreign Secretary. I hope that all the countries, both in the Commonwealth and beyond it, which hold strong views on this matter will recognise the quite exceptional efforts that we have made to explain to them the reasons why we feel this move to be necessary.
      However, we must claim the same right as any other sovereign member of the Commonwealth claims to come to our own conclusions as to our essential interests, and no more than any other independent member of the Commonwealth could we allow others to exercise or seek to exercise any power of veto over the decisions of Her Majesty's Government.
      The Commonwealth was never conceived and has never operated in such a spirit, and other Commonwealth members
      1836
      would be the first to protest if any member of that association should seek to determine their policies for them. That I should have thought must be self-evident to every Member of this House.
      When we last debated this matter my noble Friend the Minister of State for Defence expounded in great detail the defence aspects which convinced us of the continuing need to maintain the Simonstown base. The Opposition, when in office, never denied the importance of that base. If we were not to fulfil our obligations as we see them we would have no right to expect to continue to enjoy the facilities of that base and that is something which hon. Members opposite have never faced up to.
      They must look in particular at the last Aide-Memoire of the White Paper which sets out very clearly the attitude of the South African Government in relation to that. If they look at the first paragraph of page 47 they will see the strong words used by the South African Government. Right at the end of the White Paper the last two sentences show the implications of the way in which the South African Government's mind was moving over the future of the Simonstown Agreement when right hon. Gentlemen opposite were responsible for our affairs.
      It would be very unwise for anyone to assume that we would be entitled to look for the facilities of this base if we did not honour the undertaking as we have said we will. The real balance of advantage is not, as I have heard it argued today, the balance between trade with South Africa and trade with the rest of Africa. The real balance must have regard to the danger of the loss of facilities under the Simonstown Agreement that must eventually have followed our failure to honour our undertakings under that Agreement. That is an essential aspect of this which hon. Gentlemen opposite would have done well to acknowledge.
      Mr. Alexander W. Lyon rose—
      Mr. Godber: I am not prepared to give way. From the speeches by members of the Opposition one would be led to suppose that the difference between the two sides of the House is one of unimpeachable virtue on the opposite side and complete degradation in the attitude

      1837
      of the Government. Those of us, on both sides, who have worked with the representatives of black African State at the United Nations, and I am one of those who have, known that the position is looked at very differently by the Africans. They are not satisfied, and in the nature of things they never can be satisfied, by anything so limited as the banning of the sale of arms to South Africa.
      What the African nations really want is not just the banning of arms, they want the banning of trade with South Africa; they want penal sanctions against South Africa and they want those sanctions enforced by a naval blockade. Finally, they would like to see the present régime in South Africa subjected to military invasion. Everyone who has discussed this with those representatives knows that that is the case. We can all understand that view although there are very few in this House who would go along with it. When the fact is stated it serves to show how far short the policies of both the major parties of this House fall from what many Africans would wish.
      The party opposite felt that if they made their declaration banning arms for South Africa they had gone a long way to meet the African point of view. But Lord Caradon soon found at the United Nations that the step they had taken merely led to demands to go further. Within less than a year we find him making an impassioned speech at the United Nations defending Britain's right to continue to trade with South Africa.
      If there are those on the opposite side of the House who have views on this I would like to quote one paragraph of a speech which Lord Caradon made to the Special Committee on Apartheid on 1st December, 1965. I do not think that anyone in this House will accuse Lord Caradon of extreme Right-wing views. He said:
      "First I wish to re-state the principle regarding trade. This has often been clearly declared by my Government. It is no new attitude to meet a particular situation, it is a basic principle that trade is not a weapon to used to express political detestation of a régime in a particular foreign country. We trade with many countries in which the policies pursued by the Government for the time being in power are in our opinion misguided or worse but there is nothing dishonourable in this. If trade had to be dependent on satisfying a political test … world trade would soon wither away."
      1838
      [Interruption.] Perhaps hon. Members opposite do not like it, but that is what the representative of their Government expounded at the United Nations, and it is as well that they should know it.
      I come to the point about the commitment to supply arms. The immediate cause of our debate was the announcement made on Monday last week of our readiness to supply Wasp helicopters in conformity with our legal obligations as we see them. We are being urged, however, even if we do supply them, not to provide any further supplies of arms with the exception of spare parts which, I understand, even the Opposition do not deny we should supply. My right hon. Friend the Foreign Secretary today and the Prime Minister at Singapore made absolutely clear that we must retain our right to make our decisions in the light of Britain's interest as we see it. It is important, however, to consider this within the limits which we have prescribed.
      When resolution No. 181 was before the Security Council of the United Nations in 1963, Sir Patrick Dean stated the then Government's position. He said:
      "It is the position of my Government that no arms should be exported to South Africa which would enable the policy of apartheid to be enforced."
      Later he said:
      "In view of our arrangements on co-operation with South Africa for the protection of the sea routes, we must reserve our position in the light of the requirements regarding the supply of equipment appropriate to these purposes."
      Those were the limitations imposed then, and they were repeated in slightly different form on the two later resolutions.
      There has been argument about whether the voting on the resolution was mandatory. A lot of hon. Members do not realise that the normal practice of the United Nations is to vote for a generality and to reserve one's position on certain specific aspects. Reservations were made at the time and the definition was restricted. But it is important to note that when my right hon. Friend the Foreign Secretary made his statement on 20th July last year, the words which he used were very much more restrictive. He referred to
      "…certain limited categories of arms, so long as they are for maritime defence directly related to the security of the sea routes."— [OFFICIAL REPORT, 20th July, 1970; Vol. 804. c. 49.]

      1839
      No commitment has been given at this stage for any supply beyond the terms of the statement made by my right hon. Friend on Monday last week.
      The point I am making is that even if further orders were accepted they would have to conform to the very strict limitations spelt out last July. Hon. Members opposite may attack us for retaining that right; they should not distort the position or exaggerate it in the way that some of them have tended to do today. It is this very restricted aspect which will embrace any decisions we make in future in this regard. This is the point I wish to emphasise in relation to any further commitments which are undertaken. We have said that we are willing to supply the Wasp helicopters within the terms of the White Paper, but any further consideration will be limited by the words I have read out. This is a very important restriction indeed.
      In our debates on this matter many Members have spoken with a sense of deep conviction. I respect the views of those who take an attitude which is opposite to mine, even though I cannot agree with them. But there is one Member whose views on this subject I find it very difficult to respect. I refer to the right hon. Member for Leeds, East. He may have chanced his view when he was defeated in Cabinet, but, having held so strongly previously that it was right to supply arms to South Africa, I find it difficult to accept the fervour of his present protestations.
      One of my hon. Friends has already quoted what was said by Lord George-Brown in regard to the events of 1967. It is absolutely clear. The right hon. Gentleman has never denied the fact that he was closely associated with it, and if he were, then for him to get up on the basis of moral fervour, as he tried to do, is the sheerest humbug, and he knows it. I would add that I do not think it helps him particularly when his right hon. Friend the Leader of the Opposition springs to his defence, as he did on Monday last week. I do not wish to be rude to the right hon. Gentleman—[Interruption.] Well, if I am encouraged then I will tell him that his credibility gap is such that when he makes a bald
      1840
      statement unsupported by any evidence it cuts very little ice on this side of the House; it cuts very little ice in the country—and I am not sure how much ice it cuts on the benches behind him. If he says it is true, then it is open to him to convince us by producing the documentary evidence at the time. His colleague, Lord George-Brown certainly did not take that view, and his colleague, Lord George-Brown may have certain faults but I do not think anybody accuses him of being a liar.
      Coming back to the main theme of the debate, I want to repeat that I respect the feelings of all those who feel deeply about the moral issues involved, but no Government of Britain has ever carried out a successful and viable foreign policy based primarily on the internal policies, however abhorrent, of other countries. If one looks back at history one can see, if our policy had been so based, how dangerous it would have been to Britain, just as it would be to other countries. If we were so to base our policies, we should have to revise our view of many other countries in the world. We have only to remind ourselves of what happened in Czechoslovakia not so long ago to see what I mean.
      To those who speak of the balance of advantage I say that I do beg them to be absolutely sure that they are weighing the right issues in their minds. In my judgment there can be no question that it is Britain's security, Britain's sea routes, which must weigh most heavily, and if hon. Members opposite do not accept that, I find it very strange indeed.
      To both those groups to whom I have just referred, I would say that we must be absolutely clear about what we are debating tonight. It is not so much the supply of arms to South Africa, or even whether Britain may fulfil her obligations freely entered into under the Simonstown Agreement—and maintained by the Labour Party when in power. It is our legal obligation, and our determination to honour it, that we are voting on tonight. Those who feel that, for party reasons, it is their duty to attack us, may do so, but our policy is securely, soundly based on legality, on logic, and on Britain's security and Britain's interests, and I commend it to the House.
      Question put, That the Amendment be made:—
      The House divided: Ayes 311, Noes 275.

      Division No. 227.]

      AYES

      [10.0 p.m.

      Adley, Robert

      Farr, John

      King, Tom (Bridgwater)

      Alison, Michael (Barkston Ash)

      Fell, Anthony

      Kinsey, J. R.

      Allason, James (Hemel Hempstead)

      Fenner, Mrs. Peggy

      Kirk, Peter

      Amery, Rt. Hn. Julian

      Fidler, Michael

      Kitson, Timothy

      Archer, Jeffrey (Louth)

      Finsberg, Geoffrey (Hampstead)

      Knight, Mrs. Jill

      Astor, John

      Fisher, Nigel (Surbiton)

      Knox, David

      Atkins, Humphrey

      Fletcher-Cooke, Charles

      Lambton, Antony

      Awdry, Daniel

      Fookes, Miss Janet

      Lane, David

      Baker, Kenneth (St. Marylebone)

      Fortescue, Tim

      Langford-Holt, Sir John

      Baker, W. H. K. (Banff)

      Foster, Sir John

      Legge-Bourke, Sir Harry

      Balniel, Lord

      Fowler, Norman

      Le Merchant, Spencer

      Barber, Rt. Hn. Anthony

      Fox, Marcus

      Lewis, Kenneth (Rutland)

      Batsford, Brian

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

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

      Beamish, Col. Sir Tufton

      Fry, Peter

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

      Bell, Ronald

      Galbraith, Hn. T. G.

      Longden, Gilbert

      Bennett, Sir Frederic (Torquay)

      Gardner, Edward

      Loveridge, John

      Bennett, Dr. Reginald (Gosport)

      Gibson-Watt, David

      McAdden, Sir Stephen

      Benyon, W.

      Gilmour, Ian (Norfolk, C.)

      MacArthur, Ian

      Berry, Hn. Anthony

      Gilmour, Sir John (Fife, E.)

      McCrindle, R. A.

      Biffen, John

      Glyn, Dr. Alan

      McLaren, Martin

      Biggs-Davison, John

      Godber, Rt. Hn. J. B.

      Maclean, Sir Fitzroy

      Blaker, Peter

      Goodhart, Philip

      McMaster, Stanley

      Boardman, Tom (Leicester, S.W.)

      Goodhew, Victor

      Macmillan, Maurice (Farnham)

      Body, Richard

      Gorst, John

      McNair-Wilson, Michael

      Boscawen, Robert

      Gower, Raymond

      McNair-Wilson, Patrick (NewForest)

      Bossom, Sir Clive

      Grant, Anthony (Harrow, C.)

      Madden, Martin

      Bowden, Andrew

      Gray, Hamish

      Madel, David

      Boyd-Carpenter, Rt. Hn. John

      Green, Alan

      Maginnis, John E.

      Braine, Bernard

      Grieve, Percy

      Marples, Rt. Hn. Ernest

      Bray, Ronald

      Griffiths, Eldon (Bury St. Edmunds)

      Marten, Neil

      Brewis, John

      Grylls, Michael

      Mather, Carol

      Brinton, Sir Tatton

      Gummer, Selwyn

      Maude, Angus

      Brocklebank-Fowler, Christopher

      Gurden, Harold

      Maudling, Rt. Hn. Reginald

      Brown, Sir Edward (Bath)

      Hall, Miss Joan (Keighley)

      Mawby, Ray

      Bruce-Gardyee, J.

      Hall, John (Wycombe)

      Maxwell-Hyslop, R. J.

      Bryan, Paul

      Hall-Davis, A. G. F.

      Meyer, Sir Anthony

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

      Hamilton, Michael (Salisbury)

      Mills, Peter (Torrington)

      Buck, Antony

      Hannam, John (Exeter)

      Mills, Stratton (Belfast, N.)

      Bullus, Sir Eric

      Harrison, Brian (Maldon)

      Miscampbell, Norman

      Burden, F. A.

      Harrison, Col. Sir Harwood (Eye)

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

      Butler, Adam (Bosworth)

      Haselhurst, Alan

      Mitchell, David (Basingstoke)

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

      Hastings, Stephen

      Moate, Roger

      Carlisle, Mark

      Havers, Michael

      Molyneaux, James

      Channon, Paul

      Hawkins, Paul

      Money, Ernle

      Chapman, Sydney

      Hay, John

      Monks, Mrs. Connie

      Chichester-Clark, R.

      Hayhoe, Barney

      Monro,Hector

      Churchill, W. S.

      Heath, Rt. Hn. Edward

      Montgomery, Fergus

      Clark, William (Surrey, E.)

      Heseltine, Michael

      Morgan, Geraint (Denbigh)

      Clarke, Kenneth (Rushcliffe)

      Hicks, Robert

      Morgan-Giles, Rear-Adm.

      Clegg, Walter

      Higgins, Terence L.

      Morrison, Charles (Devizes)

      Cockeram, Eric

      Hiley, Joseph

      Mudd, David

      Cooke, Robert

      Hill, John E. B. (Norfolk, S.)

      Murton, Oscar

      Coombs, Derek

      Hill, James (Southampton, Test)

      Nabarro, Sir Gerald

      Cooper, A. E.

      Holland, Philip

      Neave, Airey

      Cordle, John

      Holt, Miss Mary

      Nicholls, Sir Harmer

      Corfield, Rt. Hn. Frederick

      Hordern, Peter

      Noble, Rt. Hn. Michael

      Cormack, Patrick

      Hornby, Richard

      Normanton, Tom

      Costain, A. P.

      Hornsby-Smith,Rt.Hn.Dame Patricia

      Nott, John

      Critchley, Julian

      Howe, Hn. Sir Geoffrey (Reigate)

      Oppenheim, Mrs. Sally

      Crouch, David

      Howell, David (Guildford)

      Orr, Capt. L. P. S.

      Crowder, F. P.

      Howell, Ralph (Norfolk, N.)

      Oosborn, John

      Curran, Charles

      Hunt, John

      Owen, Idris (Stockport, N.)

      Dalkeith, Earl of

      Hutchison, Michael Clark

      Page, Graham (Crosby)

      Davies, Rt. Hn. John (Knutsford)

      Iremonger, T. L.

      Page, John (Harrow, W.)

      d'Avigdor-Goldsmid, Sir Henry

      Irvine, Bryant Godman (Rye)

      Parkinson, Cecil (Enfield, W.)

      d'Avigdor-Goldsmid, JamesMaj.-Gen.

      James, David

      Percival, Ian

      Dean, Paul

      Jenkin, Patrick (Woodford)

      Peyton, Rt. Hn. John

      Deedes, Rt. Hn. W. F.

      Jennings, J. C. (Burton)

      Pike, Miss Mervyn

      Dixon, Piers

      Jessel, Toby

      Pink, R. Bonner

      Dodds-Park, Douglas

      Jones, Arthur (Northants, S.)

      Pounder, Rafton

      Douglas-Home, Rt. Hn. Sir Alec

      Jopling, Michael

      Powell, Rt. Hn. J. Enoch

      Drayson, G. B.

      Joseph, Rt. Hn. Sir Keith

      Price, David (Eastleigh)

      du Cann, Rt. Hn. Edward

      Kaberry, Sir Donald

      Prior, Rt. Hn, J. M. L.

      Dykes, Hugh

      Kellett, Mrs. Elaine

      Proudfoot Wilfred

      Eden, Sir John

      Kershaw, Anthony

      Pym, Rt. Hn. Francis

      Edwards, Nicholas (Pembroke)

      Kilfedder, James

      Quennell, Miss J. M.

      Elliot, Capt. Walter (Carshalton)

      Kimball, Marcus

      Raison, Timothy

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

      King, Evelyn (Dorset, S.)

      Ramsden, Rt. Hn. James

      Rawlinson, Rt. Hn. Sir Peter

      Soref, Harold

      Turton, Rt. Hn. R. H.

      Redmond, Robert

      Speed, Keith

      van Straubenzee, W. R.

      Reed, Laurance (Bolton, E.)

      Spence, John

      Vaughan, Dr. Gerard

      Rees, Peter (Dover)

      Sproat, Iain

      Vickers, Dame Joan

      Rees-Davies, W. R.

      Stainton, Keith

      Waddington, David

      Renton, Rt. Hn. Sir David

      Stanbrook, Ivor

      Walker, David (Clitheroe)

      Rhys Williams, Sir Brandon

      Stewart-Smith, D. G. (Belper)

      Walker, Rt. Hn, Peter (Worcester)

      Ridley, Hn. Nicholas

      Stodart, Anthony (Edinburgh, W.)

      Wall, Patrick

      Ridsdale, Julian

      Stoddart-Scott, Col. Sir M.

      Walters, Dennis

      Rippon, Rt. Hn. Geoffrey

      Stokes, John

      Ward, Dame Irene

      Roberts, Michael (Cardiff, N.)

      Stuttaford, Dr. Tom

      Warren, Kenneth

      Roberts, Wyn (Conway)

      Sutcliffe, John

      Weatherill, Bernard

      Rossi, Hugh (Hornsey)

      Tapsell, Peter

      Wells, John (Maidstone)

      Rost, Peter

      Taylor, Sir Charles (Eastbourne)

      White, Roger, (Gravesend)

      Royle, Anthony

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

      Whitelaw, Rt. Hn. William

      Russell, Sir Ronald

      Taylor, Frank (Moss Side)

      Wiggins, Jerry

      St. John-Stevas, Norman

      Taylor, Robert (Croydon, N.W.)

      Wilkinson, John

      Sandys, Rt. Hn. D.

      Tebbit, Norman

      Wolrige-Gordon, Patrick

      Scott, Nicholas

      Temple, John M.

      Woodhouse, Hn. Christopher

      Scott-Hopkins, James

      Thatcher, Rt. Hn. Mrs. Margaret

      Woodnutt, Mark

      Sharples, Richard

      Thomas, John Stradling (Monmouth)

      Worsley, Marcus

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

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

      Wylie, Rt. Hn. N. R.

      Shelton, William (Clapham)

      Thompson, Sir Richard (Croydon, S.)

      Younger, Hn. George

      Simeons, Charles

      Tilney, John

      Sinclair, Sir George

      Trafford, Dr. Anthony

      TELLERS FOR THE AYES:

      Skeet, T. H. H.

      Trew, Peter

      Mr. Reginald Eyre and

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

      Tugendhat, Christopher

      Mr. Jasper More.

      NOES

      Albu, Austen

      Davis, Clinton (Hackney, C.)

      Hooson, Emlyn

      Allaun, Frank (Salford, E.)

      Deakins, Eric

      Horam, John

      Allen, Scholefield

      de Freitas, Rt. Hn. Sir Geoffrey

      Houghton, Rt. Hn. Douglas

      Archer, Peter (Rowley Regis)

      Delargy, H. J.

      Howell, Denis (Small Heath)

      Armstrong, Ernest

      Dell, Rt. Hn. Edmund

      Huckfield, Leslie

      Ashley, Jack

      Dempsey, James

      Hughes, Rt. Hn. Cledwyn (Anglesey)

      Ashton, Joe

      Doig, Peter

      Hughes, Mark (Durham)

      Atkinson, Norman

      Dormand, J. D.

      Hughes, Robert (Aberdeen, N.)

      Bagier, Gordon A. T.

      Douglas, Dick (Stirlingshire, E.)

      Hughes, Roy (Newport)

      Barnes, Michael

      Douglas-Mann, Bruce

      Hunter, Adam

      Barnett, Joel

      Driberg, Tom

      Irvine,Rt.Hn.SirArthur (Edge Hill)

      Beaney, Alan

      Duffy, A. E. P.

      Janner, Greville

      Benn, Rt. Hn. Anthony Wedgwood

      Dunn, James A.

      Jay, Rt. Hn. Douglas

      Bennett, James (Glasgow, Bridgeton)

      Dunnett, Jack

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

      Bidwell, Sydney

      Eadie, Alex

      Jenkins, Hugh (Putney)

      Blenkinsop, Arthur

      Edelman, Maurice

      Jenkins, Rt. Hn. Roy (Stechford)

      Boardman, H. (Leigh)

      Edwards, William (Merioneth)

      John, Brynmor

      Booth, Albert

      Ellis, Tom

      Johnson, Carol (Lewisham, S.)

      Bottomley, Rt. Hn. Arthur

      English, Michael

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

      Bradley, Tom

      Evans, Fred

      Johnson, Walter (Derby, S.)

      Broughton, Sir Alfred

      Faulds, Andrew

      Johnston, Russell (Inverness)

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

      Fernyhough, Rt. Hn. E.

      Jones, Barry (Flint, E.)

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

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

      Jones, Dan (Burnley)

      Brown, Ronald (Shoreditch & F'bury)

      Fitch, Alan (Wigan)

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

      Buchan, Norman

      Fletcher, Raymond (Ilkeston)

      Jones, Gwynoro (Carmarthen)

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

      Fletcher, Ted (Darlington)

      Jones, T. Alec (Rhondda, W.)

      Butler, Mrs. Joyce (Wood Green)

      Foley, Maurice

      Judd, Frank

      Callaghan, Rt. Hn. James

      Foot, Michael

      Kaufman, Gerald

      Campbell, I. (Dunbartonshire, W.)

      Ford, Ben

      Kelley, Richard

      Cant, R. B.

      Forrester, John

      Kerr, Russall

      Carmichael, Neil

      Fraser, John (Norwood)

      Kinnock, Neil

      Carter, Ray (Birmingh'm, Northfield)

      Freeson, Reginald

      Lambie, David

      Carter-Jones, Lewis (Eccles)

      Galpern, Sir Myer

      Lamond, James

      Castle, Rt. Hn. Barbara

      Garrett, W. E.

      Latham, Arthur

      Clark, David (Colne Valley)

      Gilbert, Dr. John

      Lawson, George

      Cocks, Michael (Bristol, S.)

      Ginsburg, David

      Leadbitter, Ted

      Cohen, Stanley

      Golding, John

      Leonard, Dick

      Coleman, Donald

      Gordon Walker, Rt. Hn. P. C.

      Lestor, Miss Joan

      Concannon, J. D.

      Gourlay, Harry

      Lever, Rt. Hn. Harold

      Conlan, Bernard

      Grant, George (Morpeth)

      Lewis, Arthur (W. Ham, N.)

      Corbet, Mrs. Freda

      Grant, John D. (Islington, E.)

      Lewis, Ron (Carlisle)

      Cox, Thomas (Wandsworth, C.)

      Griffiths, Eddie (Brightside)

      Lipton, Marcus

      Crawshaw, Richard

      Griffiths, Will (Exchange)

      Lomas, Kenneth

      Cronin, John

      Grimond, Rt. Hn. J.

      Loughlin, Charles

      Crosland, Rt. Hn. Anthony

      Gunter, Rt, Hn. R. J.

      Lyon, Alexander W. (York)

      Crossman, Rt. Hn. Richard

      Hamilton, James (Bothwell)

      Lyons, Edward (Bradford, E.)

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

      Hamilton, William (Fife, W.)

      Mabon, Dr. J. Dickson

      Dalyell, Tam

      Hannan, William (G'gow, Maryhill)

      McBride, Neil

      Darling, Rt. Hn. George

      Hardy, Peter

      McCartney, Hugh

      Davidson, Arthur

      Harrison, Walter (Wakefield)

      MacColl, James

      Davies, Denzil (Llanelly)

      Hart, Rt. Hn. Judith

      McElhone, Frank

      Davies, G. Elfed (Rhondda, E.)

      Hattersley, Roy

      McGuire, Michael

      Davies, Ifor (Gower)

      Healey, Rt. Hn. Denis

      Mackenzie, Gregor

      Davies, S. O. (Merthyr Tydvil)

      Heffer, Eric S.

      Mackie, John

      1844

      1845

      Mackintosh, John P.

      Pavitt,Laurie

      Stewart, Rt. Hn, Michael (Fulham)

      McMillan, Tom (Glasgow, C.)

      Peart, Rt. Hn. Fred

      Stoddart, David (Swindon)

      McNamara, J. Kevin

      Pendry, Tom

      Stonehouse, Rt. Hn. John

      MacPherson, Malcolm

      Pentland, Norman

      Strang, Gavin

      Mahon, Simon (Bootle)

      Perry, Ernest G.

      Strauss, Rt. Hn. G. R.

      Mallalieu, E. L. (Brigg)

      Prentice, Rt. Hn. Reg.

      Summerskill, Hn. Dr. Shirley

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

      Prescott, John

      Swain, Thomas

      Marks, Kenneth

      Price, J. T. (Westhoughton)

      Taverne, Dick

      Marquand, David

      Price, William (Rugby)

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

      Marsh, Rt. Hn. Richard

      Probert, Arthur

      Thomas, Jeffrey (Abertillery)

      Mason, Rt. Hn. Roy

      Rankin, John

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

      Mayhew, Christopher

      Reed, D. (Sedgefield)

      Thorpe, Rt. Hn. Jeremy

      Meacher, Michael

      Rees, Peter (Dover)

      Tinn, James

      Mellish, Rt. Hn. Robert

      Rhodes, Geoffrey

      Tomney, Frank

      Mendelson, John

      Richard, Ivor

      Torney, Tom

      Mikardo, Ian

      Roberts, Albert (Normanton)

      Tuck, Raphael

      Millan, Bruce

      Roberts,Rt.Hn.Goronwy(Caernarvon)

      Urwin, T. W.

      Miller, Dr. M. S.

      Robertson, John (Paisley)

      Varley, Eric G.

      Milne, Edward (Blyth)

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

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

      Molloy, William

      Rodgers, William (Stockton-on-Tees)

      Walker, Harold (Doncaster)

      Morgan, Elystan (Cardiganshire)

      Roper, John

      Wallace, George

      Morris, Alfred (Wythenshawe)

      Rose, Paul B.

      Watkins, David

      Morris, Charles R. (Openshaw)

      Ross, Rt. Hn. William (Kilmarnock)

      Weitzman, David

      Morris, Rt, Hn. John (Aberavon)

      Sheldon, Robert (Ashton-under-Lyne)

      Wellbeloved, James

      Moyle, Roland

      Shore, Rt. Hn. Peter (Stepney)

      Wells, William (Walsall, N.)

      Mulley, Rt. Hn. Frederick

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

      White, James (Glasgow, Pollok)

      Murray, R. K.

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

      Whitehead, Phillip

      O'Halloran, Michael

      Silkin, Rt. Hn. John (Deptford)

      Whitlock, William

      O'Malley, Brian

      Silkin, Hn. S. C. (Dulwich)

      Willey, Rt. Hn. Frederick

      Oran, Bert

      Sillars, James

      Williams, Alan (Swansea, W.)

      Orbach, Maurice

      Silverman, Julius

      Williams, Mrs. Shirley (Hitchin)

      Orme, Stanley

      Skinner, Dennis

      Williams, W. T. (Warrington)

      Oswald, Thomas

      Small, William

      Wilson, Alexander (Hamilton)

      Owen, Dr. David (Plymouth, Sutton)

      Smith, John (Lanarkshire, N.)

      Wilson, Rt. Hn. Harold (Huyton)

      Paget, R. T.

      Spearing, Nigel

      Wilson, William (Coventry, S.)

      Palmer, Arthur

      Spriggs, Leslie

      Pannell, Rt. Hn. Charles

      Stallard, A. W.

      TELLERS FOR THE NOES:

      Pardoe, John

      Steel, David

      Mr. William Hamline and

      Parker, John (Dagenham)

      Stewart, Donald (Western Isles)

      Mr. Joseph Harper.

      Main Question, as amended, put:—
      The House divided: Ayes 308. Noes 275.

      Division No. 228.]

      AYES

      [10.12 p.m.

      Adley, Robert

      Buck, Antony

      Eden, Sir John

      Alison, Michael (Barkston Ash)

      Bullus, Sir Eric

      Edwards, Nicholas (Pembroke)

      Allason, James (Hemel Hempstead)

      Burden, F. A.

      Elliot, Capt. Walter (Carshalton)

      Amery, Rt. Hn. Julian

      Butler, Adam (Bosworth)

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

      Archer, Jeffrey (Louth)

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

      Farr, John

      Astor, John

      Carlisle, Mark

      Fell, Anthony

      Atkins, Humphrey

      Channon, Paul

      Fenner, Mrs. Peggy

      Awdry, Daniel

      Chapman, Sydney

      Fidler, Michael

      Baker, Kenneth (St. Marylebone)

      Chichester-Clark, R.

      Finsberg, Geoffrey (Hampstead)

      Baker, W. H. K. (Banff)

      Churchill, W. S.

      Fisher, Nigel (Surbiton)

      Balniel, Lord

      Clark, William (Surrey, E.)

      Fletcher-Cooke, Charles

      Barber, Rt. Hn. Anthony

      Clarke, Kenneth (Rushcliffe)

      Fookee, Miss Janet

      Batsford, Brian

      Clegg, Walter

      Fortescue, Tim

      Beamish, Col. Sir Tufton

      Cockeram, Eric

      Foster, Sir John

      Bell, Ronald

      Cooke, Robert

      Fowler, Norman

      Bennett, Sir Frederic (Torquay)

      Coombs, Derek

      Fox, Marcus

      Bennett, Dr. Reginald (Gosport)

      Cooper, A. E.

      FraserRt.Hn.Hugh(St'fford & Stone)

      Benyon, W.

      Cordle, John

      Fry, Peter

      Berry, Hn. Anthony

      Corfield, Rt. Hn. Frederick

      Galbraith, Hn. T. G.

      Biffen, John

      Cormack, Patrick

      Gardner, Edward

      Biggs-Davison, John

      Costain, A. P.

      Gibson-Watt, David

      Blaker, Peter

      Critchley, Julian

      Gilmour, Ian (Norfolk, C.)

      Boardman, Tom (Leicester, S.W.)

      Crouch, David

      Gilmour, Sir John (Fife, E.)

      Body, Richard

      Crowder, F. P.

      Glyn, Dr. Alan

      Boscawen, Robert

      Curran, Charles

      Godber, Rt. Hn. J. B.

      Bossom, Sir Clive

      Dalkeith, Earl of

      Goodhart, Philip

      Bowden, Andrew

      Davies, Rt. Hn. John (Knutsford)

      Goodhew, Victor

      Boyd-Carpenter, Rt. Hn. John

      d'Avigdor-Goldsmid, Sir Henry

      Gorst, John

      Braine, Bernard

      d'Avigdor-Goldsmid, JamesMaj.-Gen.

      Gower, Raymond

      Bray, Ronald

      Dean, Paul

      Gray, Hamish

      Brewis, John

      Deedes, Rt. Hn. W. F.

      Green, Alan

      Brinton, Sir Tatton

      Dixon, Piers

      Grieve, Percy

      Brocklebank-Fowler, Christopher

      Dodds-Parker, Douglas

      Griffiths, Eldon (Bury St. Edmunds)

      Brown, Sir Edward (Bath)

      Douglas-Home, Rt. Hn. Sir Alec

      Grylls, Michael

      Bruce-Gardyne, J.

      Drayson, G. B.

      Gummer, Selwyn

      Bryan, Paul

      du Cann, Rt. Hn, Edward

      Gurden, Harold

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

      Dykes, Hugh

      Hall, Miss Joan (Keighley)

      Hall, John (Wycombe)

      McNair-Wilson,Patrick (New Forest)

      Royle, Anthony

      Hall-Davis, A. G. F.

      Maddan, Martin

      Russell, Sir Ronald

      Hamilton, Michael (Salisbury)

      Madel, David

      St. John-Stevas, Norman

      Hannam, John (Exeter)

      Maginnis, John E.

      Sandys, Rt. Hn. D.

      Harrison, Brian (Maldon)

      Marples, Rt. Hn. Ernest

      Scott, Nicholas

      Harrison, Col. Sir Harwood (Eye)

      Marten, Neil

      Scott-Hopkins, James

      Haselhurst, Alan

      Mather, Carol

      Sharples, Richard

      Hastings, Stephen

      Maude, Angus

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

      Havers, Michael

      Maudling, Rt. Hn. Reginald

      Shelton, William (Clapham)

      Hawkins, Paul

      Mawby, Ray

      Simeons, Charles

      Hay, John

      Meyer, Sir Anthony

      Sinclair, Sir George

      Hayhoe, Barney

      Mills, Peter (Torrington)

      Skeet, T. H. H.

      Heath, Rt. Hn. Edward

      Mills, Stratton (Belfast, N.)

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

      Heseltine, Michael

      Miscampbell, Norman

      Soref, Harold

      Hicks, Robert

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

      Speed, Keith

      Higgins, Terence L.

      Mitchell, David (Basingstoke)

      Spence, John

      Hiley, Joseph

      Moate, Roger

      Sproat, Iain

      Hill, John E. B. (Norfolk, S.)

      Molyneaux, James

      Stainton, Keith

      Hill, James (Southampton, Test)

      Money, Ernle

      Stanbrook, Ivor

      Holland, Philip

      Monks, Mrs. Connie

      Stewart-Smith, D. G. (Belper)

      Holt, Miss Mary

      Monro, Hector

      Stodart, Anthony (Edinburgh, W.)

      Hordern, Peter

      Montgomery, Fergus

      Stoddart-Scott, Col. Sir M.

      Hornby, Richard

      Morgan, Geraint (Denbigh)

      Stokes, John

      Hornsby-Smith,Rt.Hn.Dame Patricia

      Morgan-Giles, Rear-Adm.

      Stuttaford, Dr. Tom

      Howe, Hn, Sir Geoffrey (Reigate)

      Morrison, Charles (Devizes)

      Sutcliffe, John

      Howell, David (Guildford)

      Mudd, David

      Tapsell, Peter

      Howell, Ralph (Norfolk, N.)

      Murton, Oscar

      Taylor, Sir Charles (Eastbourne)

      Hunt, John

      Nabarro, Sir Gerald

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

      Hutchison, Michael Clark

      Neave, Airey

      Taylor, Frank (Moss Side)

      Iremonger, T. L.

      Nicholls, Sir Harmar

      Taylor, Robert (Croydon, N.W.)

      Irvine, Bryant Godman (Rye)

      Noble, Rt. Hn. Michael

      Tebbit, Norman

      James, David

      Normanton, Tom

      Temple, John M.

      Jenkin, Patrick (Woodford)

      Nott, John

      Thatcher, Rt. Hn. Mrs. Margaret

      Jennings, J. C. (Burton)

      Oppenheim, Mrs. Sally

      Thomas, John Stradling (Monmouth)

      Jessel, Toby

      Orr, Capt. L. P. S.

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

      Jones, Arthur (Northants, S.)

      Osborn, John

      Thompson, Sir Richard (Croydon,S.)

      Jopling, Michael

      Owen, Idris (Stockport, N.)

      Tilney, John

      Joseph, Rt. Hn. Sir Keith

      Page, Graham (Crosby)

      Trafford, Dr. Anthony

      Kaberry, Sir Donald

      Page, John (Harrow, W.)

      Trew, Peter

      Kellett, Mrs. Elaine

      Parkinson, Cecil (Enfield, W.)

      Tugendhat, Christopher

      Kershaw, Anthony

      Percival, Ian

      Turton, Rt. Hn. R. H.

      Kilfedder, James

      Peyton, Rt. Hn. John

      van Straubenzee, W. R.

      Kimball, Marcus

      Pike, Miss Mervyn

      Vaughan, Dr. Gerard

      King, Evelyn (Dorset, S.)

      Pink, R. Bonner

      Vickers, Dame Joan

      King, Tom (Bridgwater)

      Pounder, Rafton

      Waddington, David

      Kinsey, J. R.

      Powell, Rt. Hn. J. Enoch

      Walder, David (Clitheroe)

      Kirk, Peter

      Price, David (Eastleigh)

      Walker, Rt. Hn. Peter (Worcester)

      Kitson, Timothy

      Prior, Rt. Hn. J. M. L.

      Wall, Patrick

      Knight, Mrs. Jill

      Proudfoot, Wilfred

      Walters, Dennis

      Knox, David

      Pym, Rt. Hn. Francis

      Ward, Dame Irene

      Lambton, Antony

      Quennell, Miss J. M.

      Warren, Kenneth

      Lane, David

      Raison, Timothy

      Weatherill, Bernard

      Langford-Holt, Sir John

      Ramsden, Rt. Hn. James

      Wells, John (Maidstone)

      Legge-Bourke, Sir Harry

      Rawlinson, Rt. Hn. Sir Peter

      White, Roger (Gravesend)

      Le Marchant, Spencer

      Redmond, Robert

      Whitelaw, Rt. Hn. William

      Lewis, Kenneth (Rutland)

      Reed, Laurance (Bolton, E.)

      Wiggin, Jerry

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

      Rees, Peter (Dover)

      Wilkinson, John

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

      Renton, Rt. Hn. Sir David

      Wolrige-Gordon, Patrick

      Longden, Gilbert

      Rhys William, Sir Brandon

      Woodhouse, Hn. Christopher

      Loveridge, John

      Ridley, Hn. Nicholas

      Woodnutt, Mark

      McAdden, Sir Stephen

      Ridsdale, Julian

      Worsley, Marcus

      MacArthur, Ian

      Rippon, Rt. Hn. Geoffrey

      Wylie, Rt. Hn. N. R.

      McCrindle, R. A.

      Roberts, Michael (Cardiff, N.)

      Younger, Hn. George

      McLaren, Martin

      Roberts, Wyn (Conway)

      Maclean, Sir Fitzroy

      Rossi, Hugh (Hornsey)

      TELLERS FOR THE AYES:

      McMaster, Stanley

      Rost, Peter

      Mr. Reginald Eyre and

      Macmillan, Maurice (Farnham)

      Mr. Jasper More.

      McNair-Wilson, Michael

      1848

      1849

      NOES

      Albu, Austen

      Fraser, John (Norwood)

      Mackintosh, John P.

      Allaun, Frank (Salford, E.)

      Freeson, Reginald

      McMillan, Tom (Glasgow, C.)

      Allen, Scholefield

      Galpern, Sir Myer

      McNamara, J. Kevin

      Archer, Peter (Rowley Regis)

      Garrett, W. E.

      MacPherson, Malcolm

      Armstrong, Ernest

      Gilbert, Dr. John

      Mallalieu, E. L. (Brigg)

      Ashley, Jack

      Ginsberg, David

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

      Ashton, Joe

      Golding, John

      Marks, Kenneth

      Atkinson, Norman

      Gordon Walker, Rt. Hn. P. C.

      Marquand, David

      Bagier, Gordon A. T.

      Gourlay, Harry

      Marsh, Rt. Hn. Richard

      Barnes, Michael

      Grant, George (Morpeth)

      Mason, Rt. Hn. Roy

      Barnett, Joel

      Grant, John D. (Islington, E.)

      Mayhew, Christopher

      Beaney, Alan

      Foot, Michael

      Meacher, Michael

      Benn, Rt. Hn. Anthony Wedgwood

      Ford, Ben

      Mellish, Rt. Hn. Robert

      Bennett, James (Glasgow, Bridgeton)

      Forrester, John

      Mendelson, John

      Bidwell, Sydney

      Griffiths, Eddie (Brightside)

      Mikardo, Ian

      Blenkinsop, Arthur

      Griffiths, Will (Exchange)

      Millen, Bruce

      Boardman, H. (Leigh)

      Grimond, Rt. Hn. J.

      Miller, Dr. M. S.

      Booth, Albert

      Gunter, Rt. Hn. R. J.

      Milne, Edward (Blyth)

      Bottomley, Rt. Hn, Arthur

      Hamilton, James (Bothwell)

      Molloy, William

      Bradley, Tom

      Hamilton, William (Fife, W.)

      Morgan, Elysian (Cardiganshire)

      Broughton, Sir Alfred

      Hannan, William (G'gow, Maryhill)

      Morris, Alfred (Wythenshawe)

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

      Hardy, Peter

      Morris, Charles R. (Openshaw)

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

      Harrison, Walter (Wakefield)

      Morris, Rt. Hn. John (Aberavon)

      Brown, Ronald (Shoreditch&F'bury)

      Hart, Rt. Hn. Judith

      Moyle, Roland

      Buchan, Norman

      Hattersley, Roy

      Mulley, Rt. Hn. Frederick

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

      Healey, Rt. Hn. Denis

      Murray, R. K.

      Butler, Mrs. Joyce (Wood Green)

      Heffer, Eric S.

      O'Halloran, Michael

      Callaghan, Rt. Hn, James

      Hooson, Emlyn

      O'Malley, Brian

      Campbell, I. (Dunbartonshire,W.)

      Horam, John

      Oram, Bert

      Cant, R. B.

      Houghton, Rt. Hn. Douglas

      Orbach, Maurice

      Carmichael, Neil

      Howell, Denis (Small Heath)

      Orme, Stanley

      Carter, Ray (Birmingh'm, Northfield)

      Huckfield, Leslie

      Oswald, Thomas

      Carter-Jones, Lewis (Eccles)

      Hughes, Rt. Hn. Cledwyn (Anglesey)

      Owen, Dr. David (Plymouth, Sutton)

      Castle, Rt. Hn. Barbara

      Hughes, Mark (Durham)

      Paget, R. T.

      Clark, David (Colne Valley)

      Hughes, Robert (Aberdeen, N.)

      Palmer, Arthur

      Cocks, Michael (Bristol, S.)

      Hughes, Roy (Newport)

      Pannell, Rt. Hn. Charles

      Cohen, Stanley

      Hunter, Adam

      Pardoe, John

      Coleman, Donald

      Irvine,Rt.Hn.SirArthur(Edge Hill)

      Parker, John (Dagenham)

      Concannon, J. D.

      Janner, Greville

      Pavitt, Laurie

      Conlan, Bernard

      Jay, Rt. Hn. Douglas

      Peart, Rt. Hn. Fred

      Corbet, Mrs. Freda

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

      Pendry, Tom

      Cox, Thomas (Wandsworth, C.)

      Jenkins, Hugh (Putney)

      Pentland, Norman

      Crawshaw, Richard

      Jenkins, Rt. Hn. Roy (Stechford)

      Perry, Ernest G.

      Cronin, John

      John, Brynmor

      Prentice, Rt. Hn. Reg.

      Crosland, Rt. Hn. Anthony

      Johnson, Carol (Lewisham, S.)

      Prescott, John

      Crossman, Rt. Hn. Richard

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

      Price, J. T. (Westhoughton)

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

      Johnson, Walter (Derby, S.)

      Price, William (Rugby)

      Dalyell, Tam

      Johnston, Russell (Inverness)

      Probert, Arthur

      Darling, Rt. Hn. George

      Jones, Barry (Flint, E.)

      Rankin, John

      Davidson, Arthur

      Jones, Dan (Burnley)

      Reed, D. (Sedgefield)

      Davies, Denzil (Llanelly)

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

      Rees, Merlyn (Leeds, S.)

      Davies, Ifor (Gower)

      Jones, T. Alec (Rhondda, W.)

      Rhodes, Geoffrey

      Davies, S. O. (Merthyr Tydvil)

      Judd, Frank

      Richard, Ivor

      Davis, Clinton (Hackney, C.)

      Kaufman, Gerald

      Roberts, Albert (Normanton)

      Deakins, Eric

      Kelley, Richard

      Roberts,Rt.Hn.Goronwy(Caernarvon)

      de Freitas, Rt. Hn. Sir Geoffrey

      Kerr, Russell

      Robertson, John (Paisley)

      Delargy, H. J.

      Kinnock, Neil

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

      Dell, Rt. Hn. Edmund

      Lambie, David

      Rodgers, William (Stockton-on-Tees)

      Dempsey, James

      Lamond, James

      Roper, John

      Doig, Peter

      Latham, Arthur

      Rose, Paul B.

      Dormand, J. D.

      Lawson, George

      Ross, Rt. Hn. William (Kilmarnock)

      Douglas, Dick (Stirlingshire, E.)

      Leadbitter, Ted

      Sheldon, Robert (Ashton-under-Lyne)

      Douglas-Mann, Bruce

      Leonard, Dick

      Shore, Rt. Hn. Peter (Stepney)

      Driberg, Tom

      Lestor, Miss Joan

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

      Duffy, A. E. P.

      Lever, Rt. Hn. Harold

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

      Dunn, James A.

      Lewis, Arthur (W. Ham, N.)

      Silkin, Rt. Hn. John (Deptford)

      Dunnett, Jack

      Lewis, Ron (Carlisle)

      Silkin, Hn. S. C. (Dulwich)

      Eadie, Alex

      Lipton, Marcus

      Sillars, James

      Edelman, Maurice

      Lomas, Kenneth

      Silverman, Julius

      Edwards, William (Merioneth)

      Loughlin, Charles

      Skinner, Dennis

      Ellis, Tom

      Lyon, Alexander W. (York)

      Small, William

      English, Michael

      Lyons, Edward (Bradford, E.)

      Smith, John (Lanarkshire, N.)

      Evans, Fred

      Mabon, Dr. J. Dickson

      Spearing, Nigel

      Faulds, Andrew

      McBride, Neil

      Spriggs, Leslie

      Fernyhough, Rt. Hn. E.

      McCartney, Hugh

      Stallard, A. W.

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

      MacColl, James

      Steel, David

      Fitch, Alan (Wigan)

      McElhone, Frank

      Stewart, Donald (Western Isles)

      Fletcher, Raymond (Ilkeston)

      McGuire, Michael

      Stewart, Rt. Hn. Michael (Fulham)

      Fletcher, Ted (Darlington)

      Mackenzie, Gregor

      Stoddart, David (Swindon)

      Foley, Maurice

      Mackie, John

      Stonehouse, Rt. Hn, John

      1850

      1851

      Strang, Gavin

      Tuck, Raphael

      Whitlock, William

      Strauss, Rt. Hn. G. R.

      Urwin, T. W.

      Willey, Rt, Hn. Frederick

      Summerskill, Hn. Dr. Shirley

      Varley, Eric G.

      Williams, Alan (Swansea, W.)

      Swain, Thomas

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

      Williams, Mrs. Shirley (Hitchin)

      Taverne, Dick

      Walker, Harold (Doncaster)

      Williams, W. T. (Warrington)

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

      Wallace, George

      Wilson, Alexander (Hamilton)

      Thomas, Jeffrey (Abertillery)

      Watkins, David

      Wilson, Rt. Hn. Harold (Huyton)

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

      Weitzman, David

      Wilson, William (Coventry, S.)

      Thorpe, Rt. Hn. Jeremy

      Wellbeloved, James

      Tinn, James

      Wells, William (Walsall, N.)

      TELLERS FOR THE NOES:

      Tomney, Frank

      White, James (Glasgow, Pollok)

      Mr. William Hamling and

      Torney, Tom

      Whitehead, Phillip

      Mr. Joseph Harper.

      Resolved,
      That this House endorses Her Majesty's Government's willingness to grant licences for
      1852
      the supply of arms to South Africa in accordance with our legal obligations in relation to the Simonstown Agreement, as set out in Command Paper No. 4589.

      BUSINESS OF THE HOUSE
      Ordered,
      That the Proceedings on the Hydrocarbon Oil (Customs and Excise) Bill [Lords] may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Weatherill.]

      GENERAL PRACTICE FINANCE CORPORATION
      10.22 p.m.
      The Under-Secretary of State for Health and Social Security (Mr. Michael Alison): I beg to move,
      That the General Practice Finance Corporation (Increase of Borrowing Powers) Order, 1971, a draft of which was laid before this House on 8th February, be approved.
      The General Practice Finance Corporation was established by the National Health Service Act, 1966, for the purpose of making loans to National Health Service general medical practitioners for providing or improving their practice premises. Section 6(3) of the Act laid down a limit of £10 million on the aggregate of the principal borrowed by the Corporation, but also provided for the limit to be raised by Order to not more than £25 million.
      The Corporation is empowered to raise finance by issuing stock and by temporary borrowing, both of which are guaranteed by the Treasury. Since it began business in May, 1967, the Corporation has issued stock amounting to £6½ million, all of which has been placed with the National Debt Office. It is also authorised to borrow temporarily up to £1½ million. It is already, therefore, effectively committed for a total of £8 million.
      The Corporation expects to make an issue of stock within the next few months and further stock issues are likely to be necessary in the foreseeable future, so that the £10 million limit has become too restrictive. The purpose of this Order is to increase the Corporation's borrowing limit to £18 million to enable it to raise sufficient finance to meet the demand for its services.
      The raising of the limit does not automatically enable the Corporation to increase its borrowing. The conditions relating to the issue and redemption of stock are subject to approval by my right
      1854
      hon. Friends the Secretaries of State for Social Services and for Scotland and by the Treasury, who have therefore to be consulted each time the Corporation wishes to increase its borrowing.
      It gives me great pleasure to move this Order, as the need for it is a sign of the success of the Corporation in fulfilling the purpose for which it was set up. I am sure that hon. Members will wish to join me in expressing thanks to the members of the Corporation, whose valuable services have made this success possible.
      10.27 p.m.
      Dr. Shirley Summerskill: The Order is indeed welcome to my hon. Friends because it is evidence that the General Practice Finance Corporation is a success and has good prospects for the future.
      The importance of the general practitioner as the backbone of the National Health Service is now generally accepted. He is the first person a patient goes to for help, he is approachable and he is not part of an institution. The fact that general practitioners have used these loans to make their premises more attractive and efficient is an indication that they are no longer content to put up with old-fashioned and out-of-date conditions, that they are modernising and adapting their premises and that they are even obtaining loans for new purpose-built premises.
      It would be interesting to know whether younger practitioners are applying for these loans. The Corporations Annual Report for 1969–70 points out that of the 348 loans taken up, 136 were for the South-East of England, with other regions having 34 or less. The whole of Wales had only 16 and the whole of Scotland only 19. This discrepancy between the regions is serious in that general practitioners seem to be setting up in the South-East to the neglect of the rest of Britain.
      It is said that they settle near to where they are trained, and the predominence of medical schools in the South-East may account for this huge number of loans being taken up in the South-East. I hope that the Government will consider the setting up of medical schools in the rest of the country, and preferably near to industrial towns, especially in the North.

      1855
      My hon. Friends have always encouraged the development of health centres. Of the total of 348 loans, 103 were for single-handed practices, which does not indicate a large enough desire among general practitioners to come together in groups or health centres. However, a smaller number applied for single-handed practice loans than in the previous year, and it is significant that there were 131 loans for practices of three or more doctors.
      I have pleasure, on behalf of my hon. Friends, in welcoming the Order.
      Question put and agreed to.
      Resolved,
      That the General Practice Finance Corporation (Increase of Borrowing Powers) Order, 1971, a draft of which was laid before this House on 8th February, be approved.

      HYDROCARBON OIL (CUSTOMS & EXCISE) BILL [Lords]
      Considered in Committee.
      [Miss HARVIE ANDERSON in the Chair]

    Clause 1

      HYDROCARBON OIL
      10.30 p.m.
      Mr. Michael Cocks: I beg to move Amendment No. 1, in page 1, line 13, leave out 60°F' and insert 15.5 recurring degrees C'.
      The Deputy Chairman: It might be for the convenience of the Committee to discuss at the same time Amendment No. 2, in line 13, leave out '60°F' and insert '15.5 recurring degrees C (288.5°K)'.
      Amendment No. 3, in line 14, leave out '60°F' and insert '15.5 recurring degrees C'.
      Amendment No. 4, in line 14, leave out '60°F' and insert '15.5 recurring degrees C (288.5°K)'.
      Amendment No. 5, in line 18, after '210°C', insert '(483°K)'.
      Amendment No. 6, in line 20, after '23°C', insert '(296°K)'.
      1856
      Amendment No. 7, in Clause 2, page 2, line 17, leave out '60°F' and insert '15.5 recurring degrees C'.
      Amendment No. 8, in line 17, leave out '60°F' and insert '15.5 recurring degrees C (288.5°K)'.
      Amendment No. 9, in line 24, leave out '60°F' and insert '15.5 recurring degrees C'.
      Amendment No. 10, in line 24, leave out '60°F' and insert '15.5 recurring degrees C (288.5°K)'.
      Amendment No. 11, in Clause 3, page 2, line 30, leave out '60°F' and insert '15.5 recurring degrees C'.
      Amendment No. 12, in line 30, leave out '60°F' and insert '15.5 recurring degrees C (288.5°K)'.
      Mr. Cocks: That would be convenient, Miss Harvie Anderson. I hope to be able to deal with these Amendments briefly. It is with some trepidation that I step into the deep waters of trying to amend a consolidation Bill since I know the severe limitations on attempting to do so.
      There are 12 Amendments in my name, the form of each being very similar. In Clause 1 it will be seen that there are mixed units of temperature measurements, degrees Fahrenheit and degrees Centigrade.
      Hon. Members will remember that on 15th February this year we changed over to the decimal currency system. What many members of the general public do not yet fully realise is that the whole nation is committed to a total changeover from the existing Imperial system of weights and measures to a metric system of weights and measures, which is due to come into force at some time by 1975. Britain has also agreed to change over to the international system of units which is known as the S.I. system.
      I am suggesting that we should drop Fahrenheit and use Centigrade, and that in addition we should give the basic unit of temperature on the S.I. system the degree Kelvin equivalent. The use of Fahrenheit is obsolete. It seems to me absurd not to take the oportunity in consolidating this legislation to get rid of this obsolescent terminology. I understand that consolidation Bills occur only from time to time and that a substantial number of years may elapse before this

      1857
      process is gone through again, and we shall be fossilising something that has long fallen out of use.
      The Joint Committee took into account the changes which have taken place and converted the old tax rates into decimal currency. Therefore, we are entitled to ask why Fahrenheit was left. We see from the Joint Committee discussions that their reasons for not doing so are recorded. The problem which apparently was the great stumbling-block was that 60 degrees Fahrenheit when changed into Centigrade becomes 15.5 recurring. The Joint Committee felt that this was not practicable and that it was not possible to work with any great degree of accuracy with such a recurring decimal.
      I would point out that huge areas of higher mathematics are based on two numbers, pi and epsilon. As the Committee will know, pi is the ratio of circumference to diameter of a circle. Much effort was spent trying to work out its exact equivalent. In 1882 it was eventually proved that it could not be worked out exactly. But an even more important number in mathematics is epsilon, which is a transcendental number, the sum of an infinite series, and can be worked out to the approximate value required for any degree of accuracy in working. One cannot help thinking that had the Joint Committee had Aesop's famous fable posed to it, he would have cleaned up a large sum of money, because to a man, on this thinking, the Committee would have backed the tortoise as opposed to the hare every time.
      The Joint Committee did not convert to Fahrenheit, because it felt that it would be impracticable to work with this figure. This is not so in practice. The Committee said that it might cause confusion and that people might have to obtain different kinds of thermometers. When we consider the upheaval which the country has experienced in changing to decimal currency and the large sums spent on converting cash registers, those arguments seem thin.
      This opportunity will not occur again for some years. I ask the Solicitor-General to accept the Amendments, which are proposed in the spirit of trying to bring our legislation into line with modern thinking, to give a Centigrade equivalent for the Fahrenheit, and, in
      1858
      brackets after that, the international S.I. unit, the Kelvin degree equivalent.
      The Solicitor-General (Sir Geoffrey Howe): I cannot invite the Committee to accept the Amendment. Nature endowed us with the figure of pi, with which be have been bedevilled in our schooldays, and we all have to live with that, preferably in the form of 22 over 7 rather than in its indefinable decimal form. It would be taking purity and modernisation too far to fly in the face of the advice and conclusions of the Joint Committee and to write into a Statute Book the figure 15.5 recurring.
      No such thermometers exist. The trade which has been accustomed to handling these figures in this way, by reference to Fahrenheit, on the one hand, and to Centigrade, on the other hand, has not demanded this change and would not welcome it. If the occasion arose at a future time for changing to a different temperature scale, it may well be that it would be found difficult to do so in such a way as to avoid a recurring decimal, which is not something for which one feels a boundless affection, especially in an Act of Parliament.
      I suggest to the Committee that it should accept the advice of the Chairman of the Joint Consolidation Committee and agree that it does not wish to pursue this extremely complex and rather curious paradox any further, and that it is as well to consolidate this part of the law in the way in which it has been in previous Bills, unless and until a movement towards different temperature scales takes place.
      Amendment negatived.
      Clause ordered to stand part of the Bill.
      Clauses 2 to 24 ordered to stand part of the Bill.

    Clause 25

      CITATION AND COMMENCEMENT
      The Solicitor-General: I beg to move Amendment No. 13, in page 15, line 32, leave out '1st March' and insert '12th April'.
      It would be proper and convenient for the Bill to come into operation, not on last Monday, but on 12th April, a

      1859
      suitable number of days after the Royal Assent can have been obtained. I am sure that the Committee will agree that this is a sensible and acceptable course.
      Amendment agreed to.
      Clause, as amended, ordered to stand part of the Bill.
      Schedules 1 to 7 agreed to.
      Bill reported, with an Amendment; as amended, considered.
      Motion made and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 55 (Third Reading), and agreed to.
      Bill accordingly read the Third time and passed, with an Amendment.

    DENTAL HEALTH
    Motion made, and Question proposed, That this House do now adjourn.— [Mr. Clegg.]
    10.40 p.m.
    Mrs. Renée Short: I am delighted to have the opportunity to raise this very important subject. It goes far beyond the whole question of increased dental charges and affects general health as well as the health of teeth. Dental caries can cause other health problems. Pain can make people feel ill and depressed. It is an expensive matter to put right. I do not know whether the House is aware that dental caries and dental disease causes about 70,000 people a year to be off work, for which sickness benefit must be paid, and about 2 million working days are lost each year as a result of dental disease.
    The office of Health Economics has pointed out that dental disease is the second most costly disease, exceeded only by mental illness. There is very great concern about the treatment of the large numbers of people who suffer from mental illness. We should be equally concerned about those suffering from dental disease. Dental disease is more expensive to treat than heart disease or bronchitis, both of which are widespread.
    I therefore suppose that the Government might say, with their turn of philosophy, that it is a blessing that more than half the population aged over 45 have
    1860
    lost their own teeth, because they are therefore immune from dental disease: they will not make any more demands on the dental service and will not cost the National Health Service any more money.
    On April Fools' Day, which is perhaps a significant date for this Government to do anything at all, an additional charge for dental treatment is to be introduced which will make what I have described, which I consider to be a serious health hazard for the nation, much more serious and alarming. The state of the nation's teeth will become much worse.
    In my view this is a mean, niggardly, class-biased decision. If it is allowed to continue for any length of time what it will mean is that those who can afford it will have conservation and restorative treatment and the poor will have their teeth extracted. We will be putting the clock back to the situation as it was before the National Health Service was introduced in 1948. This is a very grave burden for the hon. Gentleman to shoulder. I had hoped that the Secretary of State would be here tonight because this is a very serious matter, when the Government decide to tamper with existing arrangements within the National Health Service.
    The Minister will say that these charges will not be too bad, because the charges will rise to a maximum of £10 and originally, when the White Paper was introduced, patients were to pay for half the dental treatment, with no limits. Now, because of considerable pressure from dentists and the general public, the ceiling of £10 has been introduced. It means that those who cannot afford treatment will get it free if they apply to the Supplementary Benefits Commission and, according to the Minister recently, there ae plenty of exemptions.
    When the £1 charge was introduced, again by a Conservative Government, in 1952, dentists reported that there was a drop of something like 30 per cent. in attendances at dental surgeries. This was temporary, obviously. People eventually went back. When a Labour Government, after devaluation, raised the £1 charge to 30s. there was a slight fall, although not so great as in 1952. On 2nd February I pointed out to the right hon. Gentleman that this fall had taken place in 1952 and he said that that was true but that it was only temporary.

    1861
    Does the right hon. Gentleman think that it did not matter if, for a short time, thousands of people were denied the dental treatment they needed and had to put up with dental disease and possibly pain for longer than they should and, when they were finally driven, by the pain perhaps, to see a dentist they had to have much more work done than would have been necessary if they had gone earlier?
    These proposed charges are greater than the last increase of 10s., and the right hon. Gentleman is saying that a good deal of the treatment will be free. But the number of people exempt from charges will rise. If a patient has only a scaling and a small filling he might get away with a charge of less than 30s. It depends on the size of the filling and the state of the patient's mouth. To be as fortunate as this, to get away with the minimum amount of treatment he has to be a patient who visits the dentist every six months. We know from statistics, from the hon. Gentleman's Department and from the B.D.A., that less than a quarter of all adults go to their dentists as regularly as this.
    This will create a backlog of work and a good deal of difficulty for patients and dentists. It is not necessarily neglect that creates dental caries. Many conscientious people, who look after their teeth and go to the dentist regularly, still need a large amount of work done because they have the sort of teeth that decay easily. They may well have to pay considerably more to keep their teeth in reasonable order. But anyone needing major work after the new charges will get a real kick in the teeth.
    I should like the right hon. Gentleman and the Chancellor, who is the man behind this disgraceful scheme, to bear in mind that, in the North of England where money is tight and where there is a high level of unemployment, and where families are already getting into difficulty because of the Government's policy, half the adult males have lost all their teeth by the time they are 45. I wonder what the right hon. Gentleman thinks working people in Leeds will do. Will the increased charges persuade them that they should go to the dentists more regularly? Will they choose more expensive conservative treatment? Or will they say, "Pull it out and let's have done with it"?
    1862
    That is what I am afraid will happen. Very few of these people will be able to afford the cost of having a tooth crowned. It costs a patient £5 or more, though the price which the dentist will claim will be double that. It is not surprising that when the charges were announced one dentist said, "This means the end of dentistry and back to butchery".
    On 10th November the Minister said in the House that a family with two children and an income of £1,100 a year would be exempt from dental charges. That was, of course, very generous of this Government. It means that a family with two children and earning £22 a week, well below the national average wage, will be exempt from these charges. Of course, the take-home pay from £22 a week is considerably less than £22. On the national average wage, which is £28. the take-home pay is only about £22 19s. 2d., after all deductions have been made. I wonder how the Minister thinks families of this kind can afford to go to the dentist and pay the increased charges.
    Then, of course, pensioners will have to pay, unless they are on supplementary benefit. Many pensioners are just above the supplementary benefit level, and they will have to pay the charges. There will be the cost of administration of the exemption scheme and the cost of inspection and policing of all the additional exemptions. Instead of getting £14 million out of the deal the right hon. Gentleman will find that he has much less in the end. This is just another of the literally thousands of means tests which are now being imposed on the poorer people of this country by this Government.
    Then there is the possibility that the Minister will in due course introduce legislation which will make it necessary for young people above the age of 18 to have to pay the charges. The argument of the Government is that they are old enough to be married and to vote at that age, so they can pay to have their teeth attended to. The Minister ignores the advice of the profession, which is concerned because young people, between 18 and 25, tend to have an incidence of dental disease. The Minister says there is no proof that this is so, but he ignores the advice of the dental profession. The nation will have to judge who is right, and time will show.

    1863
    The Minister says children will continue to be exempt, and that, again, is very generous of this Government. I am glad that children will be exempt from at least some of the viciousness of this Government, but they are to lose school milk when they are above the age of 7, and milk is a source of calcium which is essential to the teeth of growing children. Many children just above the poverty line will not be able to claim free school meals and will take sandwiches to school and will lose a balanced meal which for many children is the one balanced meal they get, and, besides milk, a balanced diet is important for dental health.
    These proposals which the right hon. Gentleman has put forward have been opposed and condemned not once but many times by the British Dental Association, the Socialist Medical Association, by individual dentists, by dentists in private practice, and those working in the university dental schools. Not a single voice in the dental profession or in the national or provincial Press has said a single word in support of the right hon. Gentleman's proposals. Dentists are very much afraid that people will neglect their teeth even more than they do now. The Minister claimed to me in the House about three weeks ago that the increased charges will give an added incentive to look after teeth. That is just a joke, and I think the profession sees it that way.
    Dentists have improved their techniques and their practice very considerably since the introduction of the National Health Service. They have increased their productivity as well. Individual courses of treatment are cheaper than in the early days of the National Health Service. They are genuinely conscientious people who are trying to do the best they can for their patients.
    Are the charges being introduced because the Government want to wreck the National Health Service by ignoring the basic philosophy of the Opposition, that treatment should be free to the patient at the time of need?
    I beg the hon. Gentleman to take urgent steps to save the situation before serious damage is done to the nation's teeth. He should tell his right hon. Friend that the House requires him to think again about increased charges, which will
    1864
    erect a barrier between patient and dentist. I suppose it is too much to ask him to remove charges altogether, but at least he should leave them as they are. If he wants more money for the dental service, he should ask his right hon. Friend the Chancellor of the Exchequer to swop the purchase tax on sweets and chocolates, which is 22 per cent. and the purchase tax on tooth paste and dentifrice, which is 36⅔ per cent. It is nonsense that the purchase tax on articles causing damage to teeth should be at a lower rate than purchase tax on preparations which preserve the teeth. If the dentists' arithmetic is right. the Government would get £40 million more for the dental service by swopping round this purchase tax.
    If the B.M.A. in its recent advice to married couples about marital happiness had given thought to dental matters it would probably have advised people that there is nothing more off-putting to social and sexual intercourse than a bad mouth smell arising from dental caries, tobacco or drink—they are all equally unpleasant.
    The Minister should embark on an energetic programme to educate children and adults on the care of teeth, the need to clean them regularly and to forswear the sweet-eating habit. The necessity for regular visits to the dentist should be stressed. I ask him to bear in mind that it will be difficult for him to persuade people to go to the dentist more often if he is increasing the charges. Psychologically, it is just not on.
    The Minister must also give attention to the recruitment and training of more dentists. In the whole country there are only 10,250 dentists, with an average patient load of 4,474 per dentist. In the North, including Yorkshire, there are only 536 dentists, who have 6,222 patients each. We are just as badly off in the Midlands. We have slightly more dentists but a larger population. We have more than 6,000 patients per dentist. Only in the South-East is the position satisfactory. There are more than 5,000 dentists with 3,367 patients each.
    The scale of charges of dentists needs to be examined. Dentists can claim little, if anything, for treating gum conditions. A dentist cannot claim for treating teeth with fluoride. This again is very important and needs looking at. The whole bias of the charges proposed is in favour

    1865
    of extraction rather than conservation. I hope that this will be looked at as well.
    Finally, how does the hon. Gentleman propose, if the Secretary of State is determined to push this dangerous Measure through the House, to advise all those people who are entitled to free treatment that they are so entitled? It will mean another means test, another batch of forms to fill in, another set of questions to answer in addition to the mounting number of similar hurdles which have to be got over by the poorer section of the community.
    I am sorry for the hon. Gentleman. I think that he has a rotten job defending the indefensible. If he feels that this is a rotten position and quite indefensible, I think that he should resign and tell his right hon. Friend and the House why. We think very well of him and I think that such an action on his part might well deter the Government and cause them to think again before embarking on this wretched and unwise step, which is bound to cause damage to the nation's health—damage we shall greatly regret in a few years' time.
    11.01 p.m.
    The Under-Secretary of State for Health and Social Security (Mr. Michael Alison): I am glad that the hon. Member for Wolverhampton, North-East (Mrs. Renée Short) has had an opportunity, through her success in the Ballot, to raise this important subject. I assure her that I have very great pleasure in defending the position and have no intention of resigning on this issue.
    The hon. Lady mentioned the purchase tax imbalance. This has already been drawn to the attention of my right hon. Friend the Chancellor of the Exchequer by my right hon. Friend the Secretary of State for Social Services.
    When, in the course of the review of public expenditure that we initiated on taking up office, the Government came to examine the present system of charges for general dental services, we found that most patients who took care of their teeth—and therefore rarely needed more than one or two fillings at a time, together with scaling and polishing—were paying the greater part of the cost of their treatment. The taxpayer, on the other hand, was bearing most of the burden of those who neglected their teeth, and who put off going to the dentist for as long as
    1866
    possible, secure in the knowledge that—however long they delayed, irrespective of the treatment they might need, short of dentures—the cost to them would be limited to £1.50.
    Quite apart from the fact that neglect of one's teeth can have serious consequences for general as well as oral health, any system that does nothing to encourage regular attendance must, since a good deal of dental disease is progressive, result in the taxpayer having to meet the disproportionately higher costs of delay in seeking treatment. The system of charges we are introducing seems to us to be much fairer—both to patients and to the taxpayer—because it provides a positive financial incentive to patients to keep themselves dentally fit by visiting their dentists regularly. The Government will continue to pay the full cost of up to two examinations a year, so no one need be frightened about the cost of consulting his dentist and finding out what treatment he needs for dental fitness, the Government will also pay half the cost—in some instances more than half—of any treatment necessary for dental fitness, and in no circumstances will any patient have to pay more than £10 for a complete course of treatment involving possibly several visits spread over several appointments.
    Although we cannot be sure precisely how much adult patients will have to pay for dental treatment in future, we do know that if our proposals had been in force in 1969 at least half of all non-priority patients would have paid £1.30 or less—26s. or less—and only 1 per cent. the maximum of £10. Although I do not suggest that these figures are anything more than a general guide to the probable effect of the new charges, after allowing for, first, an increase since 1969 of about 20 per cent. in dentists' fees; secondly, for some variation in the pattern of demand; and, thirdly, for the fact that many low-cost estimates—for which since the dental treatment charge was first introduced in 1952 patients have had to pay the full cost—will once again be brought within the ambit of the general dental service, I am satisfied that at least half of those who have to pay for dental treatment other than dentures will pay no more—and in many instances less—under the new system than they do today. And I would remind the House

    1867
    that only about half of all courses of treatment provided in the general dental service last year were for adults.
    Indeed it is not, I think, sufficiently widely realised that the changes we are proposing will make no difference to the arrangements for treating children and young people under 18 or expectant and nursing mothers. These alone account for about 40 per cent. of all courses of general dental service treatment provided. For the present too the changes will not affect young people between the ages of 18 and 21, though we shall later be placing before the House proposals to reduce the age limit for exemption to 18 in line with the current age of majority. There will be ample opportunity for discussion of this proposal at that time and I do not, therefore, propose to say more about it at present, other than to urge all young people who have not been to the dentist for some time to make an appointment with their dentist now so that they can be made dentally fit. Thereafter, so long as they go back regularly—at least once a year, though twice a year would be better—the cost of keeping themselves dentally fit is unlikely to be great.
    Next, the system of charges will involve no significant difference in the basis of charging for dentures. Since it was first introduced in 1951—and the hon. Lady will recall that the conception of charges was that of the Labour Government, although the delivery was that of the successor Government—the charge for dentures has been roughly equivalent to 50 per cent. of the total cost. Under our proposals it will continue at the same rate. Repairs to dentures will continue, as in the past, to be free of charge to the patient. The provision and repair of dentures accounts for about 10 per cent. of all courses of dental treatment.
    At the same time we are raising the level of income below which people who find difficulty in meeting dental charges can get help from the Supplementary Benefits Commission, so that no one will be denied treatment because he really cannot afford it.
    It has been suggested that, because the patient's charge for an expensive course of treatment will be much higher than at present, patients generally will be deterred from going to the dentist. I be-
    1868
    lieve on the contrary that a great many patients, when they realise this, will appreciate the importance of going at the right time, before they need so much treatment.
    Reference has been made to the experience of the dental profession in 1952 when charges for dental treatment were first introduced, and it has been suggested that at that time the attendance of patients at dentists' surgeries dropped by 30 per cent. The effect of the charges on demand for dental treatment was discussed at considerable length in the Annual Reports of the Ministry of Health for 1952 and 1953. The 1952 Report concluded that the real fall in the volume of conservative treatment for adults between 1951 and 1952–that is to say, before and after the charge for treatment was introduced—was in the region of 5 per cent. In the latest increase from £1 to £1·50 there was no dip. By the end of 1953 it was possible to show that the decline in the number of courses of treatment for adults had been more than balanced by an increase in the number of courses provided for children. In other words, the effect of the initial imposition of the dental treatment charge in 1952 was a temporary dip in demand, followed by a small but significant change in the pattern of treatment. The changes we are proposing are not strictly comparable with the introduction of the treatment charge and in general we do not expect the effect on the demand for dental treatment to follow the same pattern, but if in some parts of the country we find, in a year or two, that dentists are spending more of their time in treating children, I do not think any of us would find this development unwelcome.
    In short, after a temporary dip, we expect demand for dental treatment from all sections of the community to reassert itself and as more patients get into the habit of going regularly to their dentist fewer extensive courses of treatment attributable to persistent neglect.
    Another fear which has been expressed is that some patients, faced with the prospect of a substantial bill to make good the defects of long neglect, will choose to have their teeth extracted rather than conserved. We do not share these fears. Patients have for many years now been used to having various forms of conservative treatment in preference to extractions and dentures; and before any

    1869
    patient has his teeth out his dentist will have ample opportunity to explain, if this is the case, the advantages of retaining his natural teeth and looking after them by becoming a regular attender. The cost of extractions is in any case by no means negligible, especially if a general anaesthetic has to be given and if the patient also needs dentures. However, my right honourable Friend has given an undertaking to the British Dental Association to watch the treatment statistics carefully under the new system of charges.
    A good deal of criticism has been levelled at the proposal to fix the maximum charge at £10. We have given a great deal of thought to this and my right hon. Friend has discussed it with representatives of the British Dental Association. We concluded, however, that the decision must be entirely a matter of judgment. Various alternative figures have been suggested, but I know of no particular argument in favour of any of them and in general, having regard to the improved arrangements for preventing hardship which I have already mentioned, any reduction of the maximum would primarily benefit those people who have neglected their teeth and who can afford to pay the higher charges.
    In conclusion I should like to say something of what we have in mind for publicising the new arrangements. My right hon. Friend the Secretary of State for Social Services has told the House that he intends, jointly with the British Dental Association, to mount a publicity campaign to explain to people the advantages, the immunities, and the probable cost, of dental treatment under the new system. My Department is preparing a leaflet which dentists can hand to their patients during the first few weeks after
    1870
    the new system is introduced, explaining how it will operate and emphasising the financial advantages—as well as the benefit to health—of attending the dentist regularly for a check-up and for any treatment which is needed to keep them dentally fit. We are also considering what other forms of publicity it would be worth while initiating, particularly in order to reach and influence those people who have not hitherto been regular attenders. Only this afternoon my right hon. Friend and I met representatives of the British Dental Association to discuss certain ideas they have for publicising the advantages of regular attendance. Although the changes we are introducing were resisted initially by the profession, I have always believed that, in time, most dentists would come to realise that our proposals, far from undoing the good work of the past, are designed to stimulate progress towards still better dental health. That is why I was glad to read in the leading article in the British Dental Journal for 15th February these words:
    "Patients must be encouraged to go on visiting their dentists and it must be made absolutely clear to them that regular attendance will mean the truest economy and a real contribution to general well-being. They must be encouraged to pass on this advice to their relatives, their friends and their acquaintances, and the public at large must be informed again and again of the benefits of dental health in the hope that irregular attenders may be persuaded to seek treatment. The message that examination and treatment at regular intervals are best for his health and lightest on his pocket needs to be conveyed to every one of his patients that the dentist's records show to have visited him within the past few years".
    Question put and agreed to.
    Adjourned accordingly at eleven minutes past Eleven o'clock.

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Preamble
The House met at half past two of the clock: The Lord Chancellor on the Woolsack.
Prayers—Read by the Lord Bishop of Norwich.

LORD SIMON OF GLAISDALE
The Right Honourable Sir Jocelyn Edward Salis Simon, Knight, President of the Probate, Divorce and Admiralty Division of the High Court of Justice, having been created Baron Simon of Glaisdale, of Glaisdale in the North Riding of the County of York, for life—Was, in his robes, introduced between the Lord Morris of Borth-y-Gent and the Lord Diplock.

DIRECTORS OF SOCIAL SERVICES: APPOINTMENT OF WOMEN
2.48 p.m.
BARONESS WOOTTON OF ABINGER: 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 how many local authorities have appointed directors of social services, and how many of those appointed are women.]
THE MINISTER OF STATE, DEPARTMENT OF HEALTH AND SOCIAL SECURITY (LORD ABERDARE): My Lords, 150 authorities have appointed a Director of Social Services. Fourteen of these are women.
BARONESS WOOTTON OF ABINGER: My Lords, while I thank the Minister for his not very reassuring Answer, may I ask whether he is not aware that for many years the great majority of social workers have been women, mostly earning very modest salaries? Does he not think it is a matter for concern that, when at last there is a reasonable career structure in this profession, the skill and experience of these women has been so poorly
1336
utilised in the highly paid appointments at the top of the hierarchy?
LORD ABERDARE: My Lords, I certainly recognise the most important part played by women in the field of social work. However, I must point out to the noble Baroness that these appointments were made by local authorities. In every case so far they have been filled by open advertisement, and it has been up to the local authority concerned to choose the person who, in their opinion, was best fitted for the post.
BARONESS BACON: My Lords, could the noble Lord say how many of the children's officers in charge of children's departments under the old Act were women?
LORD ABERDARE: My Lords, roughly speaking, about half.
LORD AMULREE: My Lords, may I ask Her Majesty's Government how many medical officers of health have been appointed to these director of social services posts?
LORD ABERDARE: My Lords, that really is another question, and I am afraid I must ask the noble Lord to give notice of it. But in general it has been the Government's policy, as it was the policy of the previous Government, for the new directors of social services to come from the social services and not be medical officers of health; certainly that they should not cover the two jobs.
BARONESS SUMMERSKILL: My Lords, the noble Lord said that this tiny proportion of women were chosen by the local authorities. Is it not the fact that 99 per cent. of the local authorities are men?
LORD ABERDARE: My Lords, that is up to those who elected them.
LORD AMULREE: My Lords, is it not a fact that the appointment of a director of social services must receive the approval of the Department of Health and Social Security?
LORD ABERDARE: My Lords, the Secretary of State has certain rights in this matter. He can advise the authority whether any of the candidates on the list supplied by the authority is unfitted. He can judge the qualifications of people

1337
put up for this appointment, but of course he would not discriminate in any way between the sexes.
LORD INGLEWOOD: My Lords, may I ask my noble friend whether he will convey to noble Baronesses opposite that there is one enlightened county in the North of England where both the chairman and the vice-chairman of the social services committee are women?
BARONESS WOOTTON OF ABINGER: My Lords, may I point out—
SEVERAL NOBLE LORDS:No.
BARONESS WOOTTON OF ABINGER: May I remind the Minister—
SEVERAL NOBLE LORDS: No.
BARONESS WOOTTON OF ABINGER: My Lords, the Minister does not know what was going to follow. May I ask whether the Minister is not aware that, while his Department cannot make these appointments, they do, as I think he has admitted, have a right of veto on them? Is he not in a position to call attention to the very remarkable fact that the great majority of social workers are women and that fewer than one in ten have been appointed to these posts?
LORD ABERDARE: My Lords, I can only repeat that the Secretary of State has the power to object to possible persons for appointment only on the ground that they are not suitably qualified. I think the noble Baroness herself has called attention to the fact, and I do not think I need call further attention to it. But perhaps I may point out that the Secretary of State's chief adviser on social work is a woman, and so is her deputy.
BARONESS BACON: My Lords, would not the noble Lord agree that the figures he gave, which show that previously 50 per cent. of children's officers were women, indicate that, quite apart from the women's point of view, the children's services are taking second place in the new set-up?
LORD ABERDARE: My Lords, I cannot comment on that. These appointments are made by the local authorities, without any influence from the Secretary of State and the Department of Health,
1338
and it is up to them whom they appoint to these posts.
BARONESS WOOTTON OF ABINGER: My Lords, does the Minister never send circulars to local authorities calling their attention to various fields in which they might be more active and various lines of policy that they might follow?
LORD ABERDARE: My Lords, I think it would be discriminatory—sexual discrimination—if we were to do this.
BARONESS SUMMERSKILL: My Lords, may I ask the noble Lord whether he would send a circular if the great majority were women?
LORD NUGENT OF GUILDFORD: My Lords, is my noble friend aware that there are some noble Members of this House who believe that local government will work best if it is allowed a measure of independence?
LORD ABERDARE: My Lords, I am grateful to my noble friend.
LORD ILFORD: My Lords, will the Minister undertake that no undue pressure will be placed on local authorities in making these appointments?
LORD ABERDARE: Certainly, my Lords.

THE M.1 MOTORWAY
2.57 p.m.
LORD ALLERTON: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether plans have been made to make the southern end of the M.1 into a three-lane road throughout.]
LORD MOWBRAY AND STOURTON: My Lords, my right honourable friend the Secretary of State for the Environment is considering the result of a departmental study into the best means of providing additional capacity, or otherwise improving conditions for traffic, on the dual two-lane section of the M.1.
LORD ALLERTON: My Lords, while thanking my noble friend for that reply, may I ask him whether the accident rate

1339
on this particular stretch of road is higher than elsewhere on the M.1?
LORD MOWBRAY AND STOURTON: My Lords, not having had notice of that question, I shall have to write to my noble friend.
VISCOUNT DILHORNE: My Lords, can the noble Lord give any estimate of the date when anything is likely to be done about that dual-carriageway?
LORD MOWBRAY AND STOURTON: Yes, my Lords. We have the departmental study which the Secretary of State has in hand, and I would expect him to be able to reach a decision before the Summer Recess.
LORD ALLERTON: My Lords, may I further ask my noble friend whether it would be considered possible to restrict the lorries to the slow lane on the dual stretch of the carriageway?
LORD MOWBRAY AND STOURTON: My Lords, that again is a rather wider matter. We all know that occasionally there is a very slow, heavy vehicle, and to stop all commercial lorries overtaking might create a larger block.
LORD BROCKWAY: My Lords, may I ask the noble Lord whether Her Majesty's Government accept in principle that three-lane roads are desirable on these main roads? If so, will he also look at the accident rate on the two-lane road between Slough and Maidenhead on the M.4, and bear that road in mind when consideration is being given to this matter?
LORD MOWBRAY AND STOURTON: Yes, my Lords. The policy is that where it is justified three lanes are built, and in most cases where M-roads are now built three-lane dual carriageways usually are justified. The figure we use is where the flow is over 50,000 passenger car units per day; then the three-lane dual carriageway is justified. As your Lordships may know, we are already enlarging the M.4. This was a result of a study started in 1968 which will be finished this year.
LORD SLATER: My Lords, is the noble Lord aware that there is a consensus of opinion in this country that the three-lane road is the most dangerous
1340
so far as motorists are concerned, and that we ought to have more dual-carriageways?
LORD MOWBRAY AND STOURTON: No, my Lords; I would not accept that at all. Our policy is to relate roads to the amount of traffic that they need to carry.
VISCOUNT HANWORTH: My Lords, does the Minister agree that it was a grave mistake, when constructing this stretch of road, not to make the bridges big enough to allow for expansion at a later date? Furthermore, will he see that this sort of error is not repeated in future projects?
LORD MOWBRAY AND STOURTON: My Lords, it is very easy to say that with hindsight. The dual-carriageway was constructed at the time with the best traffic forecast available. We are perhaps now wiser about likely increases of traffic. By 1980 it is estimated that traffic will be some 56 per cent. higher than to-day, and this is taken into account in the construction of all new roads.
LORD SHACKLETON: My Lords, can the noble Lord tell us what is the difference between "passenger car units" and motor vehicles?
LORD MOWBRAY AND STOURTON: My Lords, I thought the noble Lord the Leader of the Opposition might bowl me something like that. A passenger car unit is basically a car, but where you have a vehicle over 30 cwt. that is equal to 3 passenger car units; in other words, the larger the vehicle the more p.c.u.s.
LORD SOMERS: My Lords, would my noble friend agree that the important point is not whether the dual-carriageway has three lanes or two lanes, but that there is the changeover from three to two lanes in coming South; that traffic formerly travelling in three lanes has suddenly to converge into two lanes, which causes accidents?
LORD MOWBRAY AND STOURTON: Yes, my Lords; I think we are well aware of that.

THE CONTRACEPTIVE PILL: ISSUE TO GIRLS
3.0 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, since the administration of the birth control pill involves:—

(i) danger to health and possibly to life;

(ii) an increased risk of venereal disease; and

(iii) the possibility of an unwanted pregnancy—

whether they will instruct birth control clinics and general practitioners to ensure that unmarried girls under the age of 18 are not issued with this product without the previous consent of their parents or guardians.]
LORD ABERDARE: No, my Lords; this is for the doctor to decide. I am advised that people of 16 or over can consent to their own medical treatment, but I should expect that doctors would obtain the prior consent of parents or guardians in the case of those under 16. Advice was given to local authorities when the Family Planning Act came into force that in so far as they provided services for those under 16 they would be well advised to seek parental consent. This advice was copied to Executive Councils and local medical committees. The Committee on Safety of Drugs, which keeps continually under review the safety of the oral contraceptives, assesses the risk to health and life as very small indeed.
BARONESS SUMMERSKILL: My Lords, in view of the fact that the noble Lord has told the House that the clinics should advise mothers in certain cases, would he not be a little more forthcoming? Does he realise that this House decided the age of majority to be 18, and that under 18 girls should be cared for by their parents and guardians? Is he aware that these girls go back to their homes with these contraceptives; that, as we know, they may develop side-effects, such as thrombosis,
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liver trouble and depression, and that they may become pregnant or may develop V.D.? Yet their parents are living with them and have no idea that the girl has been taking the contraceptive pill. Therefore, is not the word "parent" or "guardian" of the under-17s rather a misnomer, because the girl is left to care for herself? I think that the House should take a stronger line on the subject.
LORD ABERDARE: My Lords, these are very difficult and delicate personal matters which are not easy to discuss in question and answer. The fact is that in the opinion of the Government it is much better to leave it to the local family doctor who knows the family and who knows the girl concerned, rather than to lay down rigid rules. Apart from those who take the view of the noble Baroness, there are a great many others who are striving all they can, through the family planning clinics, to prevent the great increase in the number of unwanted pregnancies. I think they would have a different view from that expressed by the noble Baroness.
BARONESS SUMMERSKILL: My Lords, is the noble Lord aware that there is now a case (it is sub judice, but he has mentioned it) where a doctor did tell the mother, and that doctor is now being charged with acting in an unethical manner?
LORD ABERDARE: My Lords, as the noble Baroness says, that matter is sub judice and I should not wish to comment upon it. I did not mention the case.
BARONESS SUMMERSKILL: The noble Lord did.
BARONESS GAITSKELL: My Lords, as my noble friend's statements on the contraceptive pill become wilder and wilder, would not the Minister agree that a few relevant facts and figures would help the public to weigh up the problems involved and would allay some of the anxieties that are caused? The Minister has already dealt with my noble friend's challenge to the Family Law Reform Act 1969, under which a girl of 16 is an adult and is entitled to the right of medical secrecy—
THE LORD PRIVY SEAL (EARL JELLICOE): My Lords, I am loath to

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interrupt the noble Baroness, but I think she should put a question.
BARONESS GAITSKELL: Yes. Would not the Minister agree that the need for girls under 18 to receive medical advice about contraception is demonstrated by the number of pregnancies? Some 15,000 girls under 18 became pregnant in 1969. Is the Minister also aware that family planning clinics and Brook Advisory Centres always inform general practitioners whose patients wish to take oral contraceptives? Is he also aware—
SEVERAL NOBLE LORDS: Order!
BARONESS GAITSKELL: My Lords, there is one more question. I am sorry, but this is most important. Is the Minister also aware that the 13 Brook Advisory Centres throughout Britain see 10,000 new patients a year, and that about 1,000 of these are under 18? Of this total number—
SEVERAL NOBLE LORDS: Order!
EARL JELLICOE: My Lords, again I hesitate to intervene because of my great respect for the noble Baroness, but I think that some of her questions would more properly be put in the form of an Unstarrcd Question. I think she is taking a little time over her supplementary questions. But I appreciate the interest of the House in this important and delicate matter.
LORD ABERDARE: My Lords, in reply to the noble Baroness, Lady Gaitskell, may I say that I of course recognise much of what the noble Baroness says to be correct. For the particular reason that there are two schools of thought about it, we consider that the best way through the problem as it is at the moment is that the local family doctor should advise. The only advice that the Government give is that where a girl is under sixteen the parents' consent should first be obtained.
LORD BLYTON: My Lords, is the Minister aware that there is great anxiety among those who have daughters under the age of eighteen? Is it not outrageous that this thing should happen and that doctors should keep silent and do nothing about it? I think it is out-
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rageous. A parent is the guardian of his child until she is eighteen, and I think these things ought not to happen—
EARL JELLICOE: My Lords, again I must remind the noble Lord that he should put his question.
LORD BLYTON: My Lords, is the Minister further aware that the permissiveness in society is a result of laws which have been passed here? Can we not spend money now to bring people to the natural state of society?
LORD ABERDARE: My Lords, I am as well aware as the noble Lord of the importance of the family; but I would suggest to him that in many cases where a happy family is involved the situation need not arise, and that in all probability the daughter would have such a relationship with the rest of the family, particularly with her mother, that there would be no question of the family not knowing what she was up to.
BARONESS LLEWELYN-DAVIES OF HASTOE: My Lords, is the Minister not aware that many of us on this side warmly welcome the way in which he has answered this Question?
LORD ABERDARE: My Lords, I am extremely grateful to the noble Baroness.
LORD BURNTWOOD: My Lords, may I ask the Minister whether the original reply took full account of the particular problem of female mental in-patients and mental out-patients?
LORD ABERDARE: No, my Lords. I would ask the noble Lord if he would kindly put down another Question on that matter.
LORD SEGAL: My Lords, can the noble Lord explain how the administration of a birth control pill involves the possibility of an unwanted pregnancy? I should have thought it was intended to prevent it.
LORD ABERDARE: My Lords, I think that the noble Lord should properly address that question to his noble friend Lady Summerskill.
LORD PLATT: My Lords, are Her Majesty's Government aware that a male is necessary to cause a pregnancy, wanted or unwanted; and in so far as we are this

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afternoon apparently discussing human behaviour the male should be just as much concerned as the female?
LORD ABERDARE: Yes, my Lords; I take the noble Lord's point.

NATIONAL DEBT INTEREST
LORD BESWICK: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what is the estimated cost of each 1 per cent. of interest charged on the present National Debt; what proportion of this cost is payable to foreign holders of Government securities; and what is the estimated total of new borrowings for 1971.]
EARL JELLICOE: My Lords, at March 31, 1969, the last date for which a comprehensive analysis by sector is published, the total National Debt as usually defined was about £33,500 million expressed in nominal terms. One per cent. of this total would be £335 million, though it does not follow, of course, that a 1 par cent. change in interest rates would have anything like this effect on the current cost to the Government of servicing the debt. Approximately 19 per cent. of the total debt is known to be held by overseas residents, but a significant proportion of this takes the form of interest free notes held by international organisations. A full analysis was published in the March, 1970, issue of the Bank of England Quarterly Bulletin and a new analysis is due to be published in the Bulletin this month. I think in fact it will be to-morrow. The noble Lord will not expect me to pre-judge my right honourable friend's Budget Statement by giving any estimate of the total of new borrowings in 1971.
LORD BESWICK: My Lords, I am much obliged to the noble Earl for the Answer he has given. May I ask him whether he would not agree, in general, that it is time we looked at this matter rather more rationally? Would he not agree that the advantages of the present high interest rate are now far outweighed by the disadvantages, both to the balance of payments and to the burden on industry? Could he give some assurance that
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there will be a more rational approach to this business?
EARL JELLICOE: My Lords, this Government, like other Governments, has a rational approach to this matter. Because of the way in which the noble Lord's question was couched, I think there may be noble Lords who exaggerate the effect of the present bank rate across the exchanges. It was estimated in the Radcliffe Report, for example, that the direct cost to the balance of payments of an increase in bank rate by 1 per cent. was at a rate of about £15 million a year. Although I could not vouch for it, I think that the sums are about accurate to-day. So far as direct cost across the exchanges is concerned, it is easy to exaggerate the effect of interest rates.
LORD DAVIES OF LEEK: My Lords, is the noble Earl aware that out of this ramshackle, idiotic system of the acquisitive society, with the sins and mistakes of this generation visited on those yet unborn, we shall ultimately get the acme of the acquisitive society? The National Debt was about £400 per head in the 'thirties; it is now about £1,600. It is going up in geometrical progression. Is the noble Earl aware that ultimately, under the delightful system which he sup-ports, we shall get the acme of capitalism, a millionaire born backwards; we shall owe £1 million before we have a drop of our mamma's milk?
EARL JELLICOE: My Lords, I will try to digest that mouthful.
LORD BESWICK: My Lords, while I accept what the noble Earl has said about £15 million being rather less than most people would believe to be the effect of a 1 per cent. increase, and while I would also say that there are some people who would beg leave to look into this subject a little more closely, may I ask whether he would not agree that there is little further advantage to be obtained by attracting the volume of "hot" money that we are now winning?
EARL JELLICOE: My Lords, this is clearly a question which my right honourable friend the Chancellor of the Exchequer has under close consideration. I quite take the point which the noble Lord has made about the dangers of attracting "hot" money. On the other hand, it is the Government's view

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that high interest rates at the present time are a necessary ingredient of the Government's policy of maintaining firm control over what I think are technically called the "monetary aggregates". It is one means of controlling inflation. But there is a balance here, and it is a balance which my right honourable friend the Chancellor of the Exchequer will need to keep under careful conssideration, and he will certainly do so.
LORD ROBBINS: My Lords, would the noble Earl agree that with prices rising by at least 8 per cent. per annum, current rates of interest, expressed in real terms, are very low?
EARL JELLICOE: My Lords, I was rather afraid that the question put by the noble Lord, Lord Beswick, might attract a supplementary from the noble Lord, Lord Robbins. I shall study very carefully what he has said, but I think I agree.
LORD BESWICK: My Lords, would not the noble Earl also agree that the current rate of interest is one element in the increase in the cost of production?
LORD SHACKLETON: My Lords, since the noble Earl referred to the Radcliffe Report, may I ask him to read it again, since practically every Government has ignored the recommendations? Indeed, their references to interest rates were applied in a different sense, and to a different argument, from the one used.
EARL JELLICOE: My Lords, I will. It is constantly by my bedside.
LORD WYNNE-JONES: My Lords, would the noble Earl agree that the attempt to control the economy by financial means has so far succeeded in controlling neither inflation nor the increase in unemployment?
EARL JELLICOE: My Lords, I think the noble Lord has a point, but it is a one-sided point, because I think he is attempting to argue that the Government's policy in these matters is, as it were, one-handed. It is multi-handed.

JOHN HOLLIS TRUST FOR EMPLOYEES (AMENDMENT) BILL [H.L.]
Read 2a, and committed to the Committee on Unopposed Bills.

MINERAL WORKINGS BILL [H.L.]
THE PARLIAMENTARY UNDER-SECRETARY OF STATE, DEPARTMENT OF THE ENVIRONMENT (LORD SANDFORD): My Lords, I beg leave to introduce a Bill to make further provision in relation to contributions to and payments out of the Ironstone Restoration Fund and to abolish the Advisory Committee on Ironstone Restoration. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read 1a.—(Lord Sandford.)
On Question, Bill read 1a, and to be printed.

WILBERFORCE REPORT AND THE ECONOMIC SITUATION
3.17 p.m.
LORD SHEPHERD LORD SHEPHERD rose to call attention to the Report of the Wilberforce Court of Inquiry (Cmnd. 4594) and to consider its implications for a prices and incomes policy, unemployment and economic growth; and to move for Papers. The noble Lord said: My Lords, I beg to move the Motion that stands in my name on the Order Paper. When I put the Motion on the Order Paper, the Report of the Court of Inquiry under the noble and learned Lord, Lord Wilberforce, was fresh off the printing press, and many of my colleagues felt that the material contained in that Report was well worthy of debate.
Since our last debate on the economic situation, in November, 1970, there have been a series of disturbing developments in the national economy. Rolls-Royce and the Vehicle and General Insurance Company have collapsed; there are a record number of bankruptcies; unemployment is to-day higher than perhaps it has been for some 30 years—and this, in some respects, is only the tip of the iceberg when one considers the size of

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under-employment. Then investment is falling off—I.C.I. and Shell have announced cutbacks in investment; the stock market is at its lowest for some four years; there is deep industrial strife; prices are rising at an alarming degree; and I do not think there is any doubt at all that there is deep concern about the combination of inflation and recession—the latter appearing to-day to be imminent. Therefore a debate on the economic situation is opportune.
In my speech I intend to deal with one aspect: the field of wages and prices, and the climate in the country for cooperation. The Wilberforce Report will prove a landmark in the history of this Government's search for some sort of economic policy. It is fair, it is blunt, and it holds lessons for all. I would mention immediately one important lesson of the Report: it demonstrates that distinguished men and women entrusted with Inquiries of this kind can be bullied by no one. As the Daily Mirror rightly put it, they are not anyone's jackals, and they are certainly not the jackal of any Government.
After the Prime Minister's unfortunate (although some regard them as insulting) remarks on the findings of Sir Jack Scamp's Inquiry into the dustmen's pay, and the blatantly expressed hope that the Wilberforce Inquiry would take the Government's point of view, this utter impartiality needs reaffirming. In our society, when two sides of a dispute cannot resolve their differences, we have only arbitration or a Court of Inquiry to fall back on. An essential quality of such a body is that both sides should have complete faith in the integrity and impartiality of its members. I would say here, bearing in mind the whole atmosphere of hostility to the unions as a consequence of their go-slow and the clear call by Ministers as to what the maximum award should be, that the decision of the Court, and particularly the careful way in which the Report was written, should do much to rebuild the faith of both sides in arbitration methods.
I turn briefly to the main detailed findings of the Inquiry. They found that earnings in the electricity industry had fallen behind, particularly for craftsmen. The award was above that offered by the
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employers and championed by the Government—sornething over 10 per cent. Men accepting an incentive scheme were recommended for a lead-in payment while waiting for it to be introduced—another £1 or £2 per week. There should be extra pay for socially inconvenient shift work and some extra holiday entitlement. I do not intend to enter the argument about the exact percentage increase which this package amounts to, but it is certainly not the low figure clutched at by the Government. I content myself by agreeing with the leading article in The Times of February 11, which stated that,
"Mrs. Castle's estimate of 15 per cent. seems a more natural way of judging the award."
So, my Lords, an impartial Inquiry recommended a present day award of the order of 15 per cent. That is a significant figure, and one that will recur when I turn to foreign experience, and it is on all fours with a whole string of awards negotiated recently—including the 16 per cent. for the police. These awards may be considered fair and a basis for a settlement. But even with improved productivity agreements, if we take the state of the economy as it now is, they must be regarded as inflationary if they are to be regarded as the basis for all settlements. But, of course, the award is not 15 per cent. across the board. It had the important features of special pay for shift work, for acceptance of incentive schemes; and it included extra holidays. I shall return to these features when I come to wages policy generally.
It is significant that the Report did not limit itself to the detailed findings. Exactly as the Scamp Report on the dustmen's pay had done, it rounded on the Government on the whole issue of an incomes policy, and the lessons were hammered home in the excellent Note of Reservation by Mr. J. E. Mortimer, one of the colleagues of the noble and learned Lord, Lord Wilberforce. We are, states the Report—and I agree—in a dangerous state of inflation; one that bears hardest on those on modest incomes. The Government are bluntly told that they cannot look to individual pay settlements and individual Courts of Inquiry to provide awards that will make particular groups of workers bear the burden of starting a real de-escalation in wage demands.
It is worth quoting this part of the Report, which states:
"We … think it necessary for us to emphasise with some force, that staff in the electricity industry cannot be expected to accept settlements on the lines of previous years unless there is moderation also in other pay settlements, a slower rise in prices, and some prospects of growth in their real earnings."
The Report goes on:
"… it is not for us … to suggest the means by which these objectives are to be obtained—whether by a compulsory freeze, by some overall assessing machinery, or by some consultative procedure by which wages, prices and growth policy could be co-ordinated under a concerted strategy, or by any other means. The serious problems now existing cannot be dealt with by the scrutiny of one particular claim."
My Lords, if there is a clear message to the Government, it is that they must stop running away, stop trying to pick on individual groups of workers, and accept the responsibility of evolving a proper policy for incomes as a whole, for prices and for economic growth. I can only say how warmly I applaud Mr. Mortimer's elaboration of this theme in his Note of Reservation in the Report. The present Government's tactic appears to be crude and unfair as between public and private sector, between those who are in a strong bargaining position and those who are weak. I join with Mr. Mortimer in regretting the headstrong decision—I cannot put it otherwise—to abolish the Prices and Incomes Board, the one body whose steadily built up experience could have helped at this juncture to examine with consistency the huge stream of present-day wage claims, while keeping an eye also on prices and other incomes.
Before coming to my own suggestions for a policy for incomes, prices and growth, perhaps I may turn to examine the reasons for the present-day inflation. The first point to be clear about is that this is not some peculiarly British disease, born of the wickedness of British trade unions. It is, in fact, happening throughout the Western World. The United States, as I shall demonstrate later, is going through an exactly parallel bout of inflation.
Nearer home, we all remember the events of May, 1968, in France, ending
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with a 15 per cent. wage increase across the board and annual price rises of 5 per cent. In Holland, where unions were refused a large wage increase to keep up with inflation, there was a General Strike throughout the country three months ago, on December 7. Now the Government there have imposed a bitterly contested wage freeze for six months. Finally, in Germany the wage bill was growing. Once again there was the same figure of 15 per cent. in 1970, with productivity rising by about 5 per cent. The O.E.C.D. has shown that British wage rises are about average. But the situation here is aggravated by our own stagnant economy.
The Government seem to ignore the international nature and complicated origin of the phenomenon. They are hoping, it seems to me, to put the blame upon the union leaders. In my view, it is all part of a sinister development in our national politics—the aim of exciting division and prejudice, impatience with the real problems. To seek to lay responsibility for inflation on one part of the community and to ignore all the other factors is not only untruthful and unfair, it is downright dangerous. It creates divisions where co-operation is so vital.
The recent T.U.C. document on inflation analyses the 11½ per cent. increase in prices between the end of 1967 and the end of 1969. It shows that 3 to 4 per cent. of this total was accounted for by wage advances, with all the rest split fairly evenly between extra indirect taxes and taxes on labour (part of the process of pushing goods into exports), extra import costs—which I think were about 3 per cent.—extra capital costs, due to current high interest rates, and, of course, the under-use of capital equipment. This must indicate immediately that there is a lot more to the problem than wages, and it shows that there is a need for a total policy for prices and incomes and for the general management of the economy and the attainment of growth.
Second in the causes of inflation comes what I would call a crisis of expectation. My view is fortified by a number of studies which have appeared recently. Quite simply, it seems to be the case that workers, through their trade unions, are now insisting on a clear annual advance in their real earnings and in their

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standard of living. The T.U.C. document on inflation states quite plainly:
"The Unions are now aiming at an overall growth of 4–5 per cent. per annum in real incomes, with much of the benefit concentrated on the lower paid."
My Lords, this may have all sorts of origins. Perhaps it is the final emergence of the effects of mass television in making everyone demand the middle-class standards that the medium always portrays as natural and attainable and ever-rising. Perhaps it is a consequence of education, which opens up new horizons and standards for our people. Perhaps it is a reaction to the increasing drabness of work as a consequence of automation. Perhaps it is the realisation that some countries manage steadily to offer 5 per cent., 6 per cent., 8 per cent. advances in real wages, "so why not here at home?" Whatever the exact pattern of origins, this crisis of expectation exists and it is no good our trying to bludgeon it away. It exists in this country; it exists in Western Europe; it exists even in the developing countries.
A purely British explanation of the present inflation is that it is in part a reaction to the slow growth of real incomes in 1967, 1968 and 1969. The Labour Government, after devaluation, took the courageous decision to hold back growth so as to economise on imports and to put what growth there was into exports and the balance of payments. That structural change had to be tackled by some Government in order to ensure our national survival. It has given us the present comfortable surplus in the balance of payments, but by limiting income growth in real terms to about 1 per cent. per annum it left pent-up demands for something better, which we began to experience in early 1970 and late 1969.
The last Election was fought by the present Administration on prices. Although they were ready to close their eyes to the inflationary effect of granting a 30 per cent. increase to the doctors, which they approved because it was a consequence of an arbitration award, yet they were bitterly critical of the Scamp award, presumably because it was an award to lower-paid workers. They fought a campaign that they, by a stroke, would reduce prices; but the present Government's policy is in fact stoking up inflation.
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Workers and trade unions have not been slow to realise that last autumn's mini-Budget was clearly a benefit to the better-off, and that apparently more is to come. Had the Government been seen to tackle prices with the same energy as they exploited the issue and adopted policies that stood the test of social justice, they might have been in a position to exert greater influence on the wage claims.
But, my Lords, they adopted a different course, a new style, which perhaps was best illustrated by those remarkable comments by Mr. Davies, the Secretary of State for Trade and Industry, speaking in another place in November, when he spoke of "national decadence" and "lame ducks". I will not repeat those words, but if you were to bring that philosophy down to the practical world of industrial relations, can it mean anything other than to the worker that it is to be "every man for himself" or that we should stand on our own feet? If you believe that,
"The vast majority lives and thrives in a bracing climate and not in a soft, sodden morass of subsidised incompetence".— [OFFICIAL REPORT, Commons, 4/11/70, col. 1212.]
which Mr. Davies referred to, then where stand those who have no place in the power game? Where stand the growing number of old age pensioners, the nurses and those in the labour intensive industries? If this is to be the type of society, then no one can blame unions if they accept the challenge.
My Lords, having spoken of the urgency, the rate, the international extent and the causes of inflation, I turn finally to the weapons to be used against it. The deeply disturbing feature of our inflation here in Britain to-day, the really terrifying thing, is that it is now accompanied by massive unemployment—moving towards three-quarters of a million and perhaps destined to top the one million mark—on the disastrous scale of pre-war years. I shudder to think of what the chances of social peace in our society will be if the ugly forces which I have already mentioned are unleashed in our society and these are associated with one million unemployed. My Lords, we have at the same time economic stagnation. Economic growth is being held back. I think it would be wrong to lay all the blame for this on the unions

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and the workers. The reason why industrial stagnation and productivity remains low is the failure over very many years to recognise that labour productivity is influenced by the tools, the machines, the equipment at its disposal, and the unions have no control over this.
Investment continues to fall away. Industry is gravely disturbed by the Government's decision to abolish investment grants and to move to tax allowances. Survey after survey shows that investment plans of major industrial enterprises are being cut back. The development areas are hardest hit. They are living in fear of the Government's policy of "disengagement", as it is engagingly called—"abandonment" would be a fairer word. Just as one example, the Northern Region is in dire straits. Industrial Development Certificates have fallen by half in the last 12 months; there is fear about the threat to end the regional employment premium in 1974; inquiries for factory space are given as "weak", and actual development of new factories as "very low". An article in The Times quotes a leading shipbuilder as follows on his fears of the present Government's policy:
"… the present crisis in the North is like being in a jet airliner that has climbed painfully but steadily through mist and storm to clear skies when, within a few thousand feet of cruising altitude, the pilot switches off the engines and the plane begins to dive towards destruction".
My Lords, investment depends upon confidence in an expanding economy. All the signs are that we are heading for a major recession. If the Government, with the balance of payments strong and with under-used capacity and under-used employment, do not go for growth at the Budget, there can only be but one conclusion—and let us not mince words about it. It will be that the Government will be using the hideous weapons of fear and unemployment deliberately, in the hope that they will subdue the workers and choke off wage demands. My Lords, what is so incredible about this policy is that everyone can see how this exact approach has failed over the past three years in the United States. President Nixon, a Republican President, is adopting the Democratic Party formula for economic growth. For Britain to continue on this well-worn path is in
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my view both stupid and criminal. I would ask the noble Earl, Lord Jellicoe, what is the Government's view on the level of unemployment needed to control inflation? As I have said earlier, the human tragedy in this sort of policy may be more than our social fabric can bear. At the end of the day, inflation will continue so long as "every man for himself" is enshrined in a new social philosophy.
My Lords, I come to my alternative prescription. I make no bones about the present situation. We cannot continue with the present wage advances of 15 per cent. if we are to retain the advantages in exports that devaluation has given us and if we are to protect at home those least able to fight for themselves. I say this, even while agreeing with the T.U.C. that wage advances are only a partial cause of inflation. The Wilberforce Report, the experience of other countries and our diagnosis of the real causes of inflation all point in the same direction: that of trying to secure co-operation in a national policy for all incomes, all wages and all prices in return for an agreed policy of resumed economic growth which will allow standards of living really to rise. As I see that my noble friend Lord George-Brown will be speaking, I wonder whether it is not possible even at this late hour for the three pillars of the Establishment, the Government, the C.B.I. and the T.U.C., to go back to the Declaration of Intent of 1965.
As Mr. Harold Lever has said, it should be a "broad-brush" policy: it would not be statutory, would not be detailed and would seek to contain inflation by a steady process through time. It would be applied to all sectors. It would aim at tapering off the rise in wage demands in return for which the Government would renounce unemployment and go back to resumed economic growth. As Mr. Lever has put it,
"The heart of the problem is to persuade people to abandon fantasy in seeking to increase their standard of life by wildly escalating money wages and, in its place, to settle for real and achievable increases. They will not abandon the fantasy until they are assured of the reality."
My Lords, I know that I shall be told that all this is impossible because the Labour Government tried and failed to get a voluntary policy. I hope that I have

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already indicated why that was and why the situation is so different to-day. With disastrous balance-of-payments figures for several years prior to 1964, we had to restrict growth in order to economise on imports, and we had to push all the growth there was into exports and the balance of payments. That has to-day given us this comfortable balance. But real income growth had to be restricted to 1 per cent., which is virtually no growth at all. With hindsight, we can see that no trade union movement could keep creditability in the eyes of its members by co-operation in a situation of this kind. It was an unpleasant job which fell squarely on the shoulders of the previous Administration.
But to-day we have a massive balance-of-payments surplus. We can to-day go for growth. If there was any legacy that we left for the present Administration it was this: an opportunity of growth. In Our view there can no longer be a supreme obstacle to a voluntary agreement with the T.U.C. and the unions on a national incomes and growth policy. The T.U.C. document on inflation and its newly-published Economic Review indicate clearly to those who read it carefully that a voluntary policy could well be agreed upon provided that all incomes and prices are covered and that socially just budgetary and taxation policies are resumed. There is talk in one crucial paragraph of the need for unions to give attention to negotiating arrangements which will "contribute most effectively" to the removal of inflation and unemployment. It speaks of negotiating thresholds for price increases, with wages advancing automatically only if prices get beyond this threshold. Longer holidays and shorter hours are spoken of—perhaps on the lines of the Wilberforce Report—as a means of helping "to take some force out of the immediate wage-spiral".
My Lords, I am convinced that the time is ripe for a meeting between the Government and the T.U.C. to explore these possibilities. But unless there is willingness on the part of the Government—and, for that matter, on the part of all the parties concernd—to compromise, to learn from abroad, to stop policies of prejudice and division, then it seems to me that there is little point in the exercise. Is it not a plain fact, one that we have learned over the past few years, that
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given the new balance of power in our modern society there can be no victors, no successes, once we elevate the raw conflict of the market place as the philosophy for industrial relations? Power is now so evenly shared in our democracy that we must proceed by co-operation or we shall all be the losers by the sheer all-round destruction that is now the only outcome of naked conflict.
I have tried to be practical and yet to stress the moral aspects of the crisis we are in. Here in this Chamber, rather above the immediate Party battle there may be wise heads that will join with me in regretting deeply that our society to-day should be so deeply divided and that co-operation of approach should be so difficult to achieve. May I say to the Government that any Government worth their salt, when once in power shed many of the heady notions of panaceas that they grasped at in Opposition. They move, I hope, to the centre and try to unite the nation. As Mr. Hugo Young put it in a most remarkable article in the Sunday Times:
"There are times—most of the time—when the Government still seems to be at the stage of proving that its determination is total, its integrity complete, its manifesto unflawed by the smallest doubt since taking office."
It goes on:
"To divide the nation is, by definition, to fail in the business of governing."
My Lords, on prices and incomes and inflation the sheer unwillingness of the Government and, in particular, of the Prime Minister to listen to this sort of advice I find most dispiriting. I hope that the noble Earl saw the letter of Mr. Vic Feather in to-day's Daily Mirror. I hope the noble Earl will have seen many articles and will have heard many expressions of opinion on radio that the time has now come for the three pillars of the State to meet and to seek a solution. I hope that wiser heads inside the Government will force a return to co-operation instead of division, that good will instead of self-seeking and patient attempts to cope with the complex set of problems now facing mankind in all Western countries and here will be adopted. May I conclude with this thought: I begin to suspect that time is not on our side. I beg to move for Papers.
3.49 p.m.
LORD REAY: My Lords, I think we can all be grateful for the broad terms in which this Motion is drawn and for the opportunity it thereby gives us to go beyond a consideration of the Wilberforce Report in isolation and to discuss again that most troublesome and alarming of our political problems, the finding of a cure for inflation. The Wilberforce Inquiry was one detail in the present Government's total economic strategy. I wish to argue that this strategy as a whole should be replaced with another, and to that extent I shall be reinforcing, although from a different angle, some of the arguments put forward by the noble Lord, Lord Shepherd.
Government policy in the field of incomes is, first, to refuse to accede to increased wage demands in the public sector, both by way of an example to the private sector and by way of contributing on its own account to reducing the expectations of the unions. Secondly, its policy is to apply pressure to industry not to make higher settlements by keeping demands low and money expensive; in other words, to squeeze industry of the cash with which to make inflationary settlements. Thirdly, the Government policy is to apply pressure to the unions to reduce the level of their demands by allowing unemployment to rise ever higher; in other words, to act as if the unions' need for jobs for their members was greater than the Government's need for the use of that labour. Moreover, my Lords, the Government are apparently implying that they will not change their economic policy until there is evidence that the unions have modified their demands.
I believe that there are three major mistakes in this policy of the Government, and they are political, not economic, mistakes. In the first place it fails to appreciate a fundamental change in the structure of power as between economic groups in our society. In the second place, it fails to understand the logic of the demands made by labour and the unions at the present time. In the third place, it fails to appreciate that the maintenance of stability in a living society, with its ever-changing pattern of internal power, depends on the Government's ability to appreciate that the forms in which authority is exercised can be-
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come obsolete and intolerable; to sense when they have become obsolete, and then to search to replace them with new methods of political control. Finally, and as a consequence, the Government are making the mistake of ignoring the only possibility for a solution to the double problem of inflation and stagnation; and that is, a political co-operation with the trade unions.
The Government continue to exaggerate the relative power of industry. Industry has been, and is, subject to two increasing sources of pressure. Because of the high speed of technological change, and hence the quick turnover of capital equipment, simply to possess capital equipment has become, hour by hour, increasingly expensive. And because of the expansion of markets, both naturally and also through a lowering of tariffs and through the increasing competition to which firms are subjected as a result of the lowering of tariffs, markets have become increasingly difficult and expensive to reach. To develop a share of the market, to secure it, maintain it and expand it—which is always the first target of any firm—has now become one of the most expensive, vital and easily lost of business achievements.
Faced, then, with additional costs for labour, it has been relatively easy for firms to decide that they must first sacrifice their rate of investment (which, after all, will only give them a future problem), and then their profits, which, for the most part, do not accrue to management in any case; and to do this rather than to face the threat of extinction as a trading unit. The Government are therefore simply deluding themselves if they ever think that industry can become their partner in the dangerous game of refusing the demands of labour. The Post Office, the Electricity Board—these can become partners to the Government's policy, because the Government ensure that they will not be extinguished. They are legally protected monopolies. But it will continue to be a rarity for a firm in the private sector to risk even offering a gesture on the lines which the Government are demanding from them.
But if industry is weaker than the Government allow, the work force is also stronger. There is little doubt that the days when the work force, or the unions, could be inhibited in their demands by

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the threat of unemployment are now over. There is, possibly, more than one reason why this should be true. For one thing my Lords, some of the value of unemployment was contained in the fact that labour was essentially replaceable. Part of the unspoken threat was, "Well, if you don't take the job at this price, I will find someone else who will." But, with education and an increasingly specialised labour force, this threat has no force any more. Labour has become indispensable because its parts, essentially, are no lonlonger interchangeable.
For another thing, the fear of unemployment lay also in the uncertainty that employment could be guaranteed; that Governments had technically acquired the skill to maintain employment. Unemployment was feared in a way that only an uncontrollable phenomenon can be feared. But the last 25 years have proved that full employment can be maintained. Unemployment passed from the category of natural catastrophes to the category of deliberate acts of Government policy. The fear of unemployment became not a fear, but the idea behind an act of blackmail; and the moment when labour took the decision no longer to be scared by the threat of unemployment was the moment, two years ago, when this crisis began. It was a direct counter assertion of power by labour against the power of the Government, and from that moment things were never, and will never be, the same again.
It seems to me likely that that moment marked a turning point in the balance of power within modern societies. From that point it was irrelevant to pursue a policy of deflation in order to restrain wage demands, because labour had discovered that it was powerful enough to ignore the direct consequences. The T.U.C. is therefore quite right when it asks for a policy of expansion. What, in fact, the T.U.C. is saying to the Government is this: "Look, we know that stagnation and unemployment, and the rest of the policy, is designed to make us reduce our wage demands, but that does not work any more. We have proved, we are still proving and we will continue to prove, that that does not work any more. In the meantime we are all suffering. So let us have expansion and then we can talk."
What labour is demanding is, therefore, quite simply an acknowledgment
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of its power. There is in fact only one answer to the problem posed by this power: it is that the leaders of the labour force must be given what I believe they want; namely, a permanent, acknowledged and responsible part in the economic plans and decisions of the day, and in the implementation of those decisions, regardless of the Party in power. They must agree with the Government on economic targets and economic projections, and they must publicly assume a share of responsibility for attaining them. Metaphorically speaking, my Lords, the T.U.C. and the Treasury must occupy the same building. Until the unions are brought closer to Government, instead of being placed at a distance, irresponsible wage demands and the very considerable sacrifices that these will mean—even, in aggregate, for union members—wih continue to be the expression of a protest at this exclusion from power.
In keeping the unions at a distance, therefore, the Government are failing to appreciate that the manner in which authority can be exercised has changed. If I may introduce a domestic metaphor, I would suggest an analogy with the changes that have occurred in the field of parental authority. To-day's adolescents, richer and freer than ever before, basically loyal to the family and yet more integrated with their equals outside the family than ever before, will not accept the idea that children of a family should simply obey their parents. And if their parents assert that they can, and will, impose limits to the children's behaviour, then those children may set out to prove the impotence of such assertions by their negative and defiant activities. For example, they may decide to impoverish the family by their own extravagance. In such a case a solution can be reached only by the recognition of their independence and power and a co-operation demanded on that basis. My Lords, just as to-day it is the parent who has had to make the adjustment to the demands of the children of the modern world, so it is the Government who will have to make an adjustment to the demands of the unions of the modern world.
I do not wish to enter in any detail into the question of the specific concessions which the Government would need

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to make to the unions. Plainly, they would need to introduce price control. Possibly, at least to make a transition easier, they might need to relate wage increases to rises in the cost of living. The document on inflation that the T.U.C. produced in January was referred to in some detail by the noble Lord, Lord Shepherd. This was a document the positive points of which I thought were entirely missed by the Government, but which, while perhaps provocative in some respects was nevertheless an intelligent, responsible and explicit document. It would be an obvious point of departure for an agreement between the unions and the Government. On the basis of the demands included in that document I should have thought that a compromise over an incomes policy was quite attainable.
The arguments that the Government use publicly against an incomes policy seem to me to be weak. Past experience has certainly not proved the case against an incomes policy. And to risk at a future date a dam burst seems to me a more positive approach than to drown before then in an uncontained and rising flood. The real objection of the Government looks to me less rational. It is as if they saw something unnatural in a combination between themselves and the trade unions; as if they would be undermined in their freedom to act in support of their own special electoral interest; as if to allow the unions any closer was to threaten the basis of their own authority. But I would encourage them to be less inhibited. Politics has produced plenty of less natural alliances than that between British trade unions and a Conservative Government. I, for one, do not at all consider that the T.U.C. and the Conservative Party could not together operate an incomes policy: maybe to that extent I have more confidence in the Government than they have in themselves. Just as the Government will have to accept demands from the trade unions that they do not like, so the trade unions will have to accept that their partner has interests quite different from their own.
I have no doubt that to some traditionalists the idea of such a co-operation is deeply offensive to their idea of the dignity of government. But the simple
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fact of the matter is that the trade unions want something and the Government want something. The Government want a solution to the twin problem of inflation and stagnation, and the unions want to continue to increase real wages. Each of them knows that they cannot get what they want without the help of the other. Each of them only has the power to frustrate the other. Yet it is hardly putting it too strongly to say that together they have the power to save or to ruin the country, and at the moment they are promising to ruin it. Unless the Government wish to relinquish power even further toward the trade unions, it is up to the Government to forge that necessary alliance.
4.3 p.m.
EARL JELLICOE: My Lords, before I embark on my few words, I should like to apologise to your Lordships' House and to the right reverend Prelate the Bishop of Durham for the fact that I shall have to leave the Chamber shortly after I resume my seat because there is a meeting of one of your Lordships' Committees which I have to attend.
Having said that, I should like to thank the noble Lord, Lord Shepherd, for giving us the opportunity of discussing this afternoon the problem of inflation, although I must say that doing so on the eve of, or coming up to the eve of, a Budget slightly inhibits somebody speaking from this particular Bench. But I am grateful because of the gravity of the problem. It is a fundamental threat to our prosperity, to our prospects as a nation, and indeed to our position in the world. I am also grateful for the quiet and measured tone of the speeches of the two noble Lords who have spoken. I would have wished that the noble Lord, Lord Shepherd, had at times been a little less partial. Listening to his speech, one would have thought that inflation was a dark Tory cloud that had blown up overnight out of a clear blue sky and blanketed that fair land which until June of last year was Socialist Britain.
LORD SHEPHERD: My Lords, I can only say that the noble Earl must have been asleep, because I dealt with it as an international problem. I certainly did not attribute it to the Conservative Government.
EARL JELLICOE: My Lords, I shall be turning later to the international side. I do not wish unduly to labour this point, but it is worth remembering that in June, 1970, the present Government inherited a situation where earnings were increasing by 12 per cent., six times as fast as productivity—these are grave figures—and were accelerating, with the result that prices were increasing faster than at any time for twenty years. By June of last year the Labour Government were in fact bereft of any anti-inflationary strategy of any kind. Their only two policies—the control of incomes and the reform of industrial relations—had both been jettisoned. In the long run-up months to the General Election (they were far too long for all of us) the then Government abandoned any real attempt to curb the rise in pay settlements.
That, my Lords, was our inheritance. As I have said, when the present Government took office money earnings were increasing about six times as fast as productivity. This of course was the launching pad from which prices have taken off. But I think it was also quite clear that the main factor—and we should be clear about this—driving up prices was the rapid acceleration in wage settlements between the third quarter of 1969 and the third quarter of 1970. During this period, labour costs per unit of output in the economy as a whole rose by over 12 per cent. But, of the other components of total cost, import prices rose by under 4 per cent., company profits actually fell by 2½ per cent., and there were no increases in indirect tax rates. These figures are, I think, worth remembering.
We may differ over where the responsibility may lie, although perhaps we may not differ as much as we sometimes pretend. But none of us, I believe, can differ over the dangers which inflation presents to this country, and indeed to all of us at the present time. Externally it puts in jeopardy the balance of payments—and I give full credit for the current surplus to the Chancellor of the Exchequer in the late Government. Thereby the prospects for the growth of the economy and real earnings are put at risk. Internally it bears down heavily and arbitrarily on the more vulnerable members of our community: those on
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fixed incomes, the pensioners, the poor; above all, those in a weak bargaining position—those who, unlike the big battalions, are unable to browbeat and bludgeon their way towards excessive wage settlements: in fact, those who (to use Lord Shepherd's graphic phrase, as I thought) "have no place in the power game".
I cannot put the dangers any better or more graphically than the noble and learned Lord, Lord Wilberforce, did in the Report which we are discussing this afternoon. If I may say so in the presence of the noble and learned Lord, I thought that the Report of his Committee was a notable one, and all sections of the community are in debt to our colleague in this House. Apart from anything else the Report was beautifully written, which is a rather rare event in cases of Reports of this sort. As he said in the Report:
"The country is in a dangerous condition of spiralling inflation. By 'dangerous' we mean a state of affairs which undermines almost from the start the real benefit of wage increases sought, creates social injustice and resentments, and which if continued will threaten our balance of payments and destroy the value of money."
My Lords, I believe that those words are only too true.
We can, moreover, take no real consolation from the fact that other countries are not immune from this dread disease. I remember very well how the old spellbinder, our former Prime Minister (I must parenthetically confess that my typist has mistakenly transcribed the word as "spellbounder") used to remind us that inflation was a world-wide phenomenon from which the United Kingdom, as befitted a progressive country, could not isolate itself. Other countries have, of course, been experiencing pressure on the wages front, but the point to remember is that in most cases their productivity is growing at a far higher rate than ours, and there are already signs that with them the level of wage settlements is coming down. I hope that ours is flattening out, but there are visible signs that the level of their wage settlements is actually coming down. With us, wage costs per unit of output of manufacturing in this country—and this is the important criterion—were already 9 per cent. higher in the last quarter of 1970 than in the last quarter of 1969.

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It is true, as the noble Lord, Lord Shepherd, suggested, that Germany experienced a somewhat similar rise over the same period, although I think the experts, like the noble Lord, Lord Robbins, might be tempted to point out that in the case of Germany there may have been cyclical reasons for this. However, in Italy, Japan, France and Canada—and these are some of our fiercest competitors in international trade—the increase in that same period was probably no more than from 5½ per cent. to a maximum of 7½ per cent. In the United States, moreover, it was considerably less.
My Lords, what does this mean? The answer is only too starkly simple. If our costs and prices continue to balloon upwards while in other countries the rise falls away, there will before very long be a serious deterioration in our balance of payments. Countries abroad would stop taking our goods if prices became uncompetitively high, and our own exporters would stop selling to them if they could not get an adequate profit. There would be a direct loss of jobs in export industries and in industries competing with imports. This would have a cumulative effect upon those employed in other industries and services.
My Lords, whatever the contributory causes may be, it is surely abundantly clear that the main cause of the current inflation is excessive costs rather than excessive demand. It is surely equally clear that the rate of increase in money earnings is the main factor pushing up costs. That is why the Government's policy is directed towards bringing about a progressive and substantial reduction in the level of wage settlements to more realistic levels. We recognise, of course, that, given the wide gap, which we inherited, between earnings and productivity, the level of settlements cannot be pulled down overnight, whatever methods are used, to the theoretical ideal—the level of the rate of increase in national productivity. That is why we are aiming for a progressive slowing down of the rate of wage settlements, coupled with a continuing increase in real earnings.
I must make it abundantly clear that it is, and will remain, a fundamental
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objective of this Government, within the lifetime of this Parliament, to increase our rate of growth and to accelerate the advance in the real earnings of our people and their standard of living. We do not regard, pace the noble Lord, Lord Balogh (who I am sorry is not in his place today), growth as an end in itself—to that extent we may all be Galbraiths now—but growth is essential if we are to continue to have a say in this rather dangerous world, and if our own society is to remain confident and healthy. But—and this is the point that I should like to ram home—excessive increases of purely money earnings will not achieve this. On the contrary, by jeopardising the balance of payments and by causing rising prices, excessive wage increases can only jeopardise the future growth of real earnings and real standards of living.
My Lords, I hope that it will be recognised that to de-escalate from the present level of wage settlements is in the interests of everybody in this country. It is in no way a policy aimed against wage or salary earners, and that is why the Government have urged employers in both the private and public sectors, and unions, to take account of the national interest in reaching settlements and to reduce progressively and substantially the level of those settlements. That is why we have urged employers to make fair and reasonable offers, but that is also why we have advised them, having made such offers, to stand firm, be it in the face of strikes or threats of strikes. It is our belief that to concede extra pay increases in the face of irresponsible pressure is only to play into the hands of the militants.
I should also like to make it clear that the Government's policy applies alike to the private sector and to the public sector. There is no question of our trying to batten down on the public sector. I thought that the way in which the noble Lord, Lord Shepherd, expressed his remarks—perhaps inadvertently—was possibly a little unfair, because he seemed to contrast the strong and the weak, putting the weak, as it were, automatically into the public sector. When one thinks of the strength of labour in some areas of the public sector I feel that this is hardly realistic. In any event, we have given the same advice to employers in both sectors, and where the Government

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are the employers we have acted in accordance with the advice which we have given. It is—and I make no apology for emphasising this—no part of our policy to discriminate against public sector employees. There has been a very wide range of settlements in both the public and private sectors in the past eight or nine months. Like the noble Lord, Lord Shepherd, I see no point in playing the numbers game here. One can trot out certain levels of settlements, but this is far too simpliste, and grossly misleading. The point I should like to emphasise—and I do it in full consciousness of the statistics here—is that, looking across the spectrum of settlements in the past eight months or so, there is no evidence whatsoever to suggest that public sector employees have been treated unfairly in the period since the present Government took office. And they will not be, my Lords.
I should also like to make it crystal clear that in our view the recommendations of the Court of Inquiry, so very ably presided over by the noble and learned Lord, were not inconsistent with the Government's general approach to these matters. I wish that he was speaking himself this afternoon, so that he could correct me if I am wrong. Again, like the noble Lord I do not think the particular recommendations are absolutely germane to this debate which, as I suspected, has gone rather wider. Nor do I wish in this context to play the numbers game, although if I were inclined to do so I should feel bound to query, in all sincerity, the figure which the noble Lord gave from The Times. I wonder whether he would have quoted The Times if it had given a different figure. But that is by the way.
LORD SHEPHERD: My Lords, I might then have had the Economist to support me.
EARL JELLICOE: Then I think he would have been even further out.
LORD CHAMPION: Higher, anyway.
EARL JELLICOE: My Lords, what I feel is relevant is that the general approach of the Court, as I have read the Report, was in a very important respect very much in line with that of the
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Government. They said that in making their recommendations they naturally had regard to the dangers of giving an extra twist to spiralling inflation. They considered in particular the productivity record of the electricity industry, including the contributions that the unions and employers have made and, bearing in mind the public and national economic interest, they concluded that, set against the past and prospective performance of the electricity industry, and the special features relating to the case, the settlement which they recommended ought not to intensify inflationary pressures in the economy.
It is important to remember that the Court itself made quite clear that its recommendations were related specifically to the circumstances and the special factors which surround the electricity industry itself. It particularly had in mind the very real contribution that employers and the unions together (and in this respect we are all very much in the debt of that very great man the late Mr. Carron) have made, and can increasingly make, towards higher productivity. There is therefore no question of the Court's recommendations being applied automatically to other industries whose situations may be entirely different. That is why, if I may say so without being critical, it was a little naughty of the noble Lord, Lord Shepherd (and again I may have misunderstood him), to quote the possible police settlement—or it may be the actual one now—of 16 per cent. compared with the 15 per cent., because in the case of the police the Government have made it crystal clear that they believe that the situation of the police, and their need for reinforcement, make them an absolutely special case.
LORD SHEPHERD: My Lords, I certainly was not suggesting—in fact, I expressed this view—that the 15 or 16 per cent. award was inflationary. The fact is that we have no Prices and Incomes Board who can consistently look at these matters. Remembering the Government's very passionately expressed view about the claims that were being made in this particular dispute, and their view that what the employers were offering was right and fair, may I say this? When, in the end, a Report is made which, as the noble Earl said, vindicates quite a substantial improvement on what the employers

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originally offered, I should be very grateful if the noble Earl could give us some indication of how a problem of this kind can be dealt with broadly across the country, with fairness between one group of people and another.
EARL JELLICOE: My Lords, may I come to that point in a moment?—because the noble Lord slightly interrupted my train of thought. I will certainly come back to that matter in another context in my words, which I hope will not be too long drawn out.
That is why the Government have reaffirmed their view, as the Court itself accepted, that if inflation is to be brought under control the general level of wage settlements should be reduced as rapidly as possible to a level much closer to the general rise in national productivity. Failing that, and faced with unwarranted demands, be they in the private or in the public sector, we must, in the Government's view, stand up against resulting strike action, however tiresome, however vexatious, however injurious in the short term, that action may be.
May I say that there was another part of the Court's recommendation by which I was very impressed (and I am here speaking without the benefit of the book, as it were, and therefore am subject to correction); and that is what it said about due regard being had for processes of arbitration, and its criticism of the union in this respect, which I think went wider than the particular union concerned. This is a point of principle to which I think we should all adhere, be it Government or be it unions; and there is a strong moral in what the noble and learned Lord, Lord Wilberforce, had to say in this connection.
The Government have naturally considered other possible ways of dealing with this demon of wage/costs inflation. Of course we have. We are not pursuing our present policy as a result of any stubborn addiction to doctrine. We are pursuing it because we believe it, in the circumstances at present, to be the most realistic and effective approach, and the one which takes account of the experience—the not too happy experience—of recent years. What are the other possible approaches? They have already been touched on. In substance they amount to three in number.
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First of all, we could have introduced a statutory freeze on all incomes. This indeed might provide us with some badly needed breathing space. There are signs—for example, the poll reported in the Sunday Times earlier this week—that a lot of people would accept such a freeze, at least when it was in prospect. But I believe it would provide no lasting solution. A wage freeze may be a high dam against cost/wage inflation. But it is a very thin and temporary dam, and once it is broken the pent-up waters of inflation are likely to carry much before them downstream. I can only say, in answer to the noble Lord, Lord Reay, that when a dam breaks I personally prefer to be upstream of that dam rather than downstream; but that is no doubt a matter of opinion and gravity.
The second possibility, of course, would be a reversion to a detailed statutory control of pay settlements. There are those who advocate a formalised statutory incomes policy of this kind, with all the paraphernalia of norms and criteria, and all that it entails by way of detailed intervention by the Government in all pay negotiations and pay settlements. I would merely remark that our predecessors operated such a statutory policy without conspicuous success. Significantly, they no longer advocate it, and so far as I know no single European country has successfully operated a long-term statutory prices and incomes policy.
The third possibility—and it is the one to which the noble Lord, Lord Shepherd, was inclining to adhere—would be a voluntary incomes policy to be agreed by the Government and the T.U.C. and the Confederation of British Industry. I should like to make it clear beyond a shadow of doubt that we would certainly not rule out any such possibility. It has worked before—for example, in Austria and in Finland—and I do not see why, in certain circumstances, it should not work here. In any event, the Government have made it clear that they do not rule out such a voluntary policy, although I notice from the letter by Mr. Victor Feather which was drawn to my attention, in I believe to-day's Daily Mirror, that the price of co-operation on the part of the T.U.C., among other things, is the jettisoning of the Industrial Relations Bill.
LORD SHEPHERD: My Lords, if the noble Earl looks at that letter I think he will see that Mr. Feather says that he is prepared to talk to the Prime Minister with no conditions attached.
EARL JELLICOE: My Lords, the letter says: "Our advice is this: that the Government put the Bill to one side and get down to the real issue." I do not know whether this is a condition.
Your Lordships will be aware that the T.U.C. have made their analysis of the position. It was a careful analysis, and some feel that this could be the basis, with modifications, if necessary, of a voluntary policy. We certainly welcome the interest of the T.U.C. in this very serious and pressing problem, which of course engages them just as much as it engages any citizen in this community who is not a trade unionist, or the Government themselves. Ministers have discussed these matters with the T.U.C., and the Prime Minister has made it clear—he made it clear again in another place yesterday—that he is very willing to have a dialogue with the T.U.C. on these matters. But that said, it would be disingenuous for me to suggest that the Government at present really believe that the T.U.C.'s proposals could form the basis of a voluntary incomes policy. The expansion for which they are asking could not possibly bridge the present gap between the 14 per cent. increase in wage earnings and the 2 to 3 per cent. rise in production which we have in this country at the present time. Wage increases at the level which they are suggesting—which I calculate, perhaps mistakenly, bearing taxation, which they wish us to take into account, at something like 16 per cent—would, as the noble Lord, Lord Shepherd, will agree, be a certain recipe for continuing and rampant inflation. Having said that, I would once again underline that certainly we do not wish to close any door which may possibly be ajar. It would certainly be very far from my own nature to suggest that we should.
Then, there are of course those who argue that we should, in conjunction or separately, impose a short, sharp freeze on prices. There again I must point out that the previous Government's efforts to contain prices through the statutory machinery were not conspicuously successful. In fact, prices rose much faster
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during the period of office of the Labour Government than during the last 5½ years of the last Conservative Government—the comparison is, I believe, nearly 30 per cent. as against 15 per cent—and, apart from this, a price freeze would have highly undesirable consequences in both the private and the public sector. It would be further bearing down on that liquidity which is affecting investment prospects, to which the noble Lord, Lord Shepherd, rightly drew attention.
My Lords, before I conclude I remember that I have not answered the point which the noble Lord put to me. All I would do here is to remind the noble Lord that in one important area in the public sector we are on the point of establishing three pay review bodies which will have an important impact, and, coincident with that, the Office of Manpower Economics; and I suggest to the noble Lord that he should see these animals functioning before he nods his head negatively.
LORD SHEPHERD: My Lords, I was not nodding; I was shaking.
EARL JELLICOE: My Lords, may I say this by way of conclusion? I do not, I hope, underestimate the seriousness of the situation with which we, as a nation, are faced on the economic front. We inherited a situation in which wage pressures were gathering momentum—even greater than we, and certainly far greater than the previous Administration, realised at the time. We were accelerating, and accelerating fast, down a slippery slope towards economic disaster, and the major objective of the Government's economic policy in the short term must therefore be to contain and turn back those pressures. We do not kid ourselves that this is going to be an easy task. There is the sheer mathematical velocity behind the present inflation, and there is, too, the problem that inflation is in part a psychological state. As a nation we are suffering from the pent-up frustration of the previous period of statutory incomes policy, and inflation is an animal which to a large extent feeds on itself. Success, therefore, in de-escalating the level of wage settlements against the background of a firm control of demand is our short-term policy. This will be neither quickly nor easily won. However, when success is achieved here—and I am confident that we shall

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achieve it—we shall have immensely improved the prospects for employment and have reached the situation where the necessary confidence about future sales and profitability should restore and enhance the prospects for investment.
I say that I am confident advisedly, and I say it because the rapid increase in the size of the settlements which we witnessed last year has been checked and the situation which at one time—and I fully confess this—looked as if it might be getting out of control has been at least stabilised. I am confident more especially because I believe that there is now a growing awareness in this country of what is meant by inflation, and a growing determination to stand up to exorbitant claims from wherever they come. However, I should not like to leave your Lordships with the impression that the Government are going to be deflected by the serious shorter-term problems confronting them and all of us from the pursuit of their longer-term policies for the basic restructuring of the economy. One can always be blown off course, but that depends on whether one is on the right course and how tenaciously one intends to hold to that course.
In any event, we intend firmly to pursue the main lines of those economic policies which we put to the electorate and on which we were returned. We are convinced, for example, that it is in the best interests of this nation to put the proposals contained in our Industrial Relations Bill through Parliament. Doubtless, my Lords, we shall be having some short and desultory discussions in this House about this matter in the not too distant future. By the same token, we are convinced that our review of public expenditure will provide real opportunity for increasing the dynamism of the economy, to the long-run advantage of all sections of society. We likewise believe that heavy and steep personal taxation has in the past been a major factor in our failure to match the growth performance of our major trading rivals. That is why we intend to carry out a progressive programme for the reduction, reform and simplification of taxation. We are also convinced that a more competitive climate in industry will stimulate freedom and lead to greater industrial efficiency.
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Finally, the purpose behind these policies is to attain substantial and sustained growth, that substantial and sustained growth which has been denied this country for much too long. I do not deny for one moment that in the short term we have very considerable problems to confront. But we remain convinced that the fundamentals of our longer-term economic policy are sound; and it is by them, my Lords, and by their success, that we shall be content to be judged.
4.35 p.m.
THE LORD BISHOP OF DURHAM: My Lords, professing what is, as will soon be very obvious to you all, no economic expertise, I nevertheless think and hope that this speech will continue two, at least, of the broad themes, which have characterised earlier speeches, and in particular will underline from other directions the absolute necessity of genuine, thorough and the broadest possible co-operation in our industrial and political life, as well as the sheer gravity of the present situation. In all the discussions in this area, whether in debates or in White Papers, there is one phrase which constantly recurs, though to be truthful I have heard it only once so far this afternoon. It is a phrase which can make the weakest argument apparently convincing; it is a trump card the effectiveness of which no one can possibly dispute. The fascination of the phrase is that no one dare attack what it describes. Its danger is that those who use it most analyse it least. The phrase is "public interest".
If I may say so, not the least merit of the Wilberforce Report is that its authors do attempt some unpacking of this phrase. True, at more than one point in the early parts of the paper it is dangerously associated with, and sometimes even seems to be equated with, the interests of the national economy. I say "dangerous" for it might suggest that, like the national economy, the public was some impersonal function of economic factors rather than what the public is—a community of human beings. But in paragraph 10.18 the Report attempts what is, in this area, an all too rare concrete formulation of public interest. For instance, it is against the public interest for the cost of living to rise while wages are constant. It is against the public interest for wages for

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similar jobs to "get out of line beyond a certain degree". It is against the public interest to calculate pay increases by adding together the forces of various arguments in isolation. But it is in the public interest, for example, to grant wage claims "where labour has co-operated to increase productivity".
It is in the public interest that vital public services should be "healthy", "viable" and "progressive"—I quote the three adjectives. It is in the public interest that workers should be "properly paid" and have "confidence" that their claims are not being overlooked; further, that there should be "union and worker co-operation". But surely it is even more in the public interest that there should be not only union and worker co-operation but management, union and worker co-operation. The irony is that public interest, as here, not only very generally ignores the public altogether but is used in arguments whose force is directed to unions and workers by themselves.
Public interest can so very easily become "my" sectional interest, whoever "I" am. In a phrase from the Prayers in this House, public interest can very soon become "partial affections". And here, of course, is the moment of truth. The public interest surely requires a sense of everybody—not just unions and workers, but all, linked co-operatively—acting together creatively in a single community to which they know they belong. That is a point that I will return to presently.
But, meanwhile, as another route to it, suppose we consider the much-neglected public factor in this idea of public interest. What suggestions might emerge for a prices and incomes policy? First, prices. The public, being those who pay for goods and services—and that means all of us, as price payers—will surely never support, on the one hand, an incomes policy that bites and, on the other, a prices policy which has virtually no teeth at all, even artificial ones. Further, the public interest, which must by definition take the widest possible human view, will demand that we never blind ourselves to the point well made in paragraph 10.6 of the Report; namely, the severe impact which rises
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in prices have had and continue to have on ordinary people with modest think I prefer to say low) fixed incomes—old folks, widows, single parent families living on assistance. If anybody is the public, they are.
Secondly, the tensions between the private and public sectors already referred to. The public could hardly be expected reasonably to support any incomes policy that bites harder on the public sector than on the private sector. The public could not reasonably accept one law for the Rootes group and another for the Post Office, railways and electricity workers. I suspect that this is behind some of the somewhat guarded language of paragraph 10.16 of the Report. I welcome the reassurance given by the noble Earl, Lord Jellicoe, but I would say: do let us have some examples which we can give immediately to people, and which speak in their own right, to show clearly that there is no difference whatever in the policy towards the public sector and the policy towards the private sector. We are in desperate need of clear examples which make the point in a telling way.
Thirdly, unemployment. One of the classical ways of refashioning industry and bringing wage demands under total employer control—no suggestion here of co-operation—was to permit, or even create, large-scale unemployment. The valleys of the North of England can well bear evidence to this. Those are days which all of us, on all sides, would wish to forget, if it were not that we have great lessons to learn from them. But I hope very much that no one will forget that spectre of unemployment which is already casting its dark shadow, not least in the North East. A community with a million unemployed as a regular feature—a possibility we are sometimes invited by leader writers to contemplate—is something we could never accept as an economic or social necessity. It could not be in the public interest. Unemployment may have been in the past, it might be in the future a sectional interest; and it might even be in the interests of a particular economic theory. But can any serious unemployment ever be in the public interest, in the interest of a "healthy" community, to use the adjective of the Wilberforce Report?

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As for services, a reasonable public interest must surely acknowledge and appreciate the contribution made to our social wellbeing by some of the lowest paid workers, whether they are dustmen or school teachers or nurses; and if the means of doing this is to disturb the relativities of pay, the differentials, there is only one conclusion, and that is that we need some fresh overall look, a fresh overall look which may be long overdue.
This brings me to an overall point, public interest in the widest sense. We surely cannot talk of public interest without having an overall public policy, a policy which will win the acceptance of the community, something perhaps implied by the phrase "governmental intervention" in paragraph 10.16 of the Report. And whatever its inadequacies, whatever its intricacies, and also, whatever be its successes, the old Prices and Incomes Board did represent an empirical, practical way of at least approaching an overall policy; and it leads to the question: what now is to take its place? Surely something must, and we shall not reach that something by merely wishing for it or declaring that doors are open.
What we desperately need is a group, board, committee, commission—I do not care what we call it—but some group of people whose professional expertise in economic and financial affairs, whose professional expertise in management and union affairs, is absolutely unquestioned, but whose evident concern is with the wellbeing in relation to prices and incomes of the whole community—the public interest indeed.
My Lords, may I style the argument from another direction? I recognise—we all recognise—that industry is nowadays so constructed that the share of its resources which should go to the various partners co-operating in it, and to the consumer, that often neglected factor, the public, is decided by competition. Now competition becomes a disintegrating, demoralising conflict when, but only when, those competing have no common aims and no common ideals. To put it from the other side, a race meeting for horses or for men is absolutely valueless if only one horse or man runs. Competition is absolutely necessary for that kind of community behaviour that we call a race and value as such. So with
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the public interest: competition may be positively valuable. I am not arguing against competition. I am saying that competition can be positively valuable, but only if it is contained within some overall plan and purpose, as in the case of running a race.
In other words, competition is quite defensible if, and only if, there is some publicly acknowledged policy which that competition can forward; otherwise competition is utterly destructive. Unfortunately, what we have, if I may speak from the touchline, is a competition and a race where the last thing the contestants know is where they are going and what they are running for, except that each wants to be ahead of the others, whether it is with profits or wages or whatever it is. Not surprisingly, the result is the absolute chaos that we find ourselves in to-day; and it is chaos made even more chaotic and more disastrous if it seems (and it need only seem) to be the case that employers and Governments together are determined to weaken the bargaining power of workers, with public interest then being interpreted apparently as sectional interest—partial affection of one of the partners, not all of them, in society.
The public interest demands a balancing of all factors and all sectional interests. It demands a co-operative effort. It demands that integrated thinking which—yes, as in war (one is tempted almost to say, tragically, "only in war") comes with a commonly acknowledged purpose and policy; and further, for there to be a public policy of this universality and this generality there has to be—and I make no apology for introducing it—a moral dimension to it. It must be as wide as the dominant ideas and ideals of Man. As the Wilberforce Report wisely remarks at paragraph 5.18:
"Co-operation is in terms of integrity, first a duty which thereafter may, by reason of its nature and measure, become a virtue."
Moral categories cannot be excluded from something to which quite plainly economic categories in the first place are plainly relevant and important and necessary.
Against those reflections the terrible truth dawns. We are nearing bankruptcy in the ideas and the moral ideals which stir men's deepest loyalties and which, in the last resort, alone will give cohesion

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to society. We certainly need better, and better informed discussion at both expert and popular level, about prices and incomes and unemployment and economic growth; but we neglect the moral dimension at our peril. Men do not find fulfilment and satisfaction if our social ideal is the interest of the national economy, full stop. Public interest cannot be circumscribed by anything less than a policy of ideas and moral ideals; and this is something which is desperately needed, and needing to be worked out by some inter-professional body, board, committee or commission of unquestionable professional expertise, of undoubted prestige and national status, prepared to ask fundamental questions about the economy, about society, about man and human existence. If I may say so, more than three pillars of the State are wanted. It might be five pillars, it might even be seven. Or, to use the metaphor that the noble Earl, Lord Jellicoe, mentioned before, if we are going to have many animals on the scene, someone somewhere has to be a keeper of them or the chaos is going to be worse than ever.
Men and women may be, and are, wage earners, price raisers, price payers, capital in-putters, consumers and the rest. But most of all, what we so often forget is that, while being all those, men are, surprisingly, men, whose life-blood depends on their being together in a co-operative partnership in a community. For centuries, through partial success and shameful failure, the Christian Church has been a community struggling with this structure; so I am not likely to think that the task before us is easy. But if the public interest does not constantly press on us the need for the broadest possible policy, having a moral dimension disclosing itself around economic, financial and social considerations, a policy which is nationally approved and publicly acknowledged—if considerations of public interest do not underline the need for a policy as widely founded as that, the phrase "public interest" is a mere noise the emptiness of which reveals the utter bankruptcy of our planning and thinking, indeed of society at large. How much we need what the Wilberforce Report calls in paragraph 1017 a "concerted strategy".
This is no fanciful and impractical idealism of a right reverend Prelate; it is
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the implicit conviction of the ordinary man and woman, up there in County Durham or elsewhere, who wonders where on earth it is all going to end. They are beginning to suspect, and they say so, that probably everybody else, even the expert, is wondering, too. This is no question of the blind leading the blind; rather is it the impoverished and the pressurised leading the baffled and the dispirited and the suspicious. What we need more than anything else is a spelling out of the public interest in terms of some overall policy, something of which I see the very first glimmerings in the Wilberforce Report despite the modesty of its authors. We want that policy, that concerted strategy which could expect public support, because that body which I have called a Board or Commission incorporated not only professional expertise, but the experience and the approach and the sensitivity of ordinary people as well. Only in this way do I think we shall ever bring back to this nation cohesion instead of chaos, unity instead of disintegration, and co-operation instead of that division which is so plain and tragic for us all to look at to-day.
5.0 p.m.
BARONESS WOOTTON OF ABINGER: My Lords, I do not think that one of your Lordships would dispute that the Wilberforce Report is an extremely brilliant document. Quite apart from anything else, it achieved the remarkable feat of making every side believe that they had won—the employers, the workers and the public at large. It did something else, It set out the facts of the whole situation with unexampled clarity, so that we could all see for ourselves what the electricity workers were paid, what they were asking for and what they were being offered. A most eloquent letter in The Times some days ago from the noble Baroness, Lady Sharp, asked that we might have similar exact and objective information about the Post Office dispute. We have not yet had it.
The Wilberforce Report was an investigation; it was not an arbitration. The noble Lord, Lord Shepherd, spoke in reverent terms of the value of arbitration in industrial relations. I would not take issue with him at all except to say that the field of arbitration is much more limited than some of us like to believe. In a court of law a decision is given on

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principles which are already established by Statute or by case law. The judge has something to refer to and his task is to apply the existing law, whatever it is, with absolute integrity and impartiality to the two disputants. In an arbitration, the arbitrator acts in a vacuum, and I think we underestimate the limits that that imposes. We do not all hold the same ideas about what different people ought to be paid, and therefore we do not always start from an agreed basis. For this reason, an arbitration is generally only successful in those cases where there are explicitly laid down agreed principles—and in the industrial field there are not very many of these. Nor can the function be performed simply by expertise. I have great sympathy with the right reverend Prelate in his wish to see an expert body that would handle some aspect of this question of incomes policy. But expertise by itself is not enough; there have to be some social, moral and economic judgments that are made first.
I do not altogether share—I wish I could—the conviction of my noble friend Lord Shepherd and of the noble Lord, Lord Reay, that a voluntary incomes policy is likely ever to succeed in this country, or indeed anywhere else. A voluntary incomes policy is one of those occasions when it is necessary to obey the commandment,
"Thou shalt do what it would be a good thing for everybody else to do."
That is a commandment which it is always very difficult to obey, because you have no guarantee that everybody else will do likewise. If I may say so, it is exactly parallel to the case of disarmament. Any State will disarm if it is convinced that every other State will disarm.
"Thou shalt disarm if everybody else will disarm."
"Thou shalt restrain thy income demands if everybody else will restrain their income demands."
But that guarantee is not forthcoming.
Therefore, sooner or later, we have to choose between the alternatives that have been put before us. I need not deal with them in much detail because they have all been mentioned, though not always from quite the same angle as I would approach them myself. We could, I suppose, go on as we are with continuous, progressive
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inflation. That is simply terrifying, and nobody would advocate it. We could have violent credit restriction and very heavy unemployment. The horrors of that have been eloquently portrayed by the right reverend Prelate; and the noble Lord, Lord Reay, gave convincing evidence that, quite apart from its immorality, that policy does not now work. With three-quarters of a million unemployed, there is no sign that the unions will abate their wage demands for fear that somebody else will take the job for a lower wage: the fences are now far too well established. We could have the total freeze—again eloquently described by the noble Earl, Lord Jellicoe, and particularly eloquently described in regard to what happens when it comes to an end and the dam bursts. The freeze, of course, freezes every existing injustice; it catches the people whose claims are still in the pipeline, and it allows the people whose claims have just slipped through to get away with it.
I would say that the policy the Government have outlined is really a worse version of the total freeze. The Government's policy of what is now called progressive de-escalation (I wish the noble Lord, Lord Conesford, were here to support me in substituting the words "progressive reductions") of wage claims is simply a way of saying first come, best served," and the later you come, the lower the wage claims are supposed to have got to. There is no discrimination as to the merits of the claims; no discrimination as to the period between the present claim and the previous one. There is simply the fortuitous fact of the time at which a claim comes to be considered.
I find all these courses, for one reason or another, extremely unattractive. Therefore I come round to the view that we ought to consider a wage policy, and a general incomes policy even more, which would be part of the normal framework and structure of our society. I do not know why this is thought to be unattractive. The distribution of income throughout the community is a matter of the utmost economic importance. It is a regulator in industry; it can obstruct the function of industry and it can facilitate the function of industry. It is also of very great social importance. The pattern of income distribution governs

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our social lives. It governs even our social intercourse—the people with whom we associate. I therefore hope that we shall regard this not as an emergency measure against inflation, but as something that we have to grow into as part of our normal social organisation. I should think that this would appeal particularly to my noble friends on these Benches. After all, our Party is the heir to a socialist tradition, and I have never understood why the Party which is at least the heir to that tradition would not regard a socially justifiable incomes policy as the keystone of our socialist arch. I would go further to-day; I would say that, whatever one's political allegiance, an incomes policy which is the expression of our political and economic philosophy, whatever that may be, is the keystone of a stable economy and a civilised pattern of living.
An incomes policy has to conform to certain requirements. It has to be economically viable; it has to take account of shortages of labour and so forth. It has also to be socially defensible. It has to take account of cases where people are being paid salaries and wages which are totally out of proportion to the kind of responsibilities they carry. I think—this is a purely personal opinion—that the police were an example in that category, and I hope it will soon be recognised that the nursing profession is another such case.
Secondly, it has to take account of all incomes, and not just the incomes of wage earners. I do not know why every noble Lord who has spoken this afternoon has spoken almost as though we were all wage earners, which we are not. An incomes policy will never succeed unless it takes account of the incomes of pensioners; the incomes of wage and salary earners, great and small; the incomes of independent self-employed persons—the chap who keeps the little shop at the corner; the incomes of the directors of giant corporations; and the incomes of the shareholders of those corporations. It is not that all these necessarily contribute equally to inflation—they do not; and we tend to concentrate on wages and salaries because they are so very much more numerous that they loom larger in that particular context. But that is not enough. There are moral factors involved here, and it
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is quite impossible ever to hope that there will be co-operation in wage restraint without some equal and comparable restraint being imposed upon non-wage incomes.
I see that the Bow Group, who I understand represent the progressive wing of the Conservative Party, are in favour, as I am, of a statutory incomes policy, but they expressly say that it is impossible to put artificial restraint on dividends and interest. So when they talk about an "incomes" policy, they really mean a "wages" policy. They use emotive language. They say that a restraint on dividends and interest is artificial, but that a restraint on wages is normal, necessary and natural. The Bow Group might have said that putting a ceiling on dividends was unjust; and I should have agreed with them, because the shareholders of companies do not all have the same personal incomes: there are rich and poor shareholders. But I have noticed that when a ceiling on dividends is suggested as a voluntary restraint, as happened some time ago, the shareholders of large companies all turn into impoverished widows and orphans. We all know that they are a very mixed lot, economically and socially. Therefore to deal with investment incomes by a simple restriction on dividends is unfair and unjust. Our policy must be economically viable and socially defensible. It must cover all incomes, and nobody must go to prison because of it. I do not want a statutory incomes policy under which people go to prison.
My Lords, consistent with those requirements, what can we do? In this country we have a capital gains tax, and I suggest that we need to supplement that with an incomes gains tax. Taxation is the only instrument by which we shall really affect the whole pattern of incomes. The Government are very anxious to get rid of the selective employment tax, and I suggest they might do very well to substitute in its place my incomes gains tax. It would work like this. The Government would lay down not a single norm, as under a temporary wage freeze, but a series of norms relating to different income brackets. I should hope that the norms of increase would be larger for the smaller incomes and smaller for the larger incomes.

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The general effect of such a policy would be to narrow the gap between the top and bottom incomes, rather than to widen it, as has happened in recent years. There would be some exceptions from these norms, in the case of people who had fallen behind or had suffered under some kind of long-term social disability so that for long periods the value of their work had been greatly underestimated. Those exceptions would be highly controversial and there should be full political discussion. I emphasise that this is a political question. Different political Parties might have different views, on the merits of these cases, and eventually the Government of the day would have to decide who was entitled to go outside the norm for their income bracket.
For this purpose, I have no doubt that we want a resuscitated Prices and Incomes Board. We want an expert body which would apply the principles which the Government have already laid down, apply the norms to the income brackets and apply the rules about exceptions. The norms would not be fixed, and it would be absolutely basic that they should not be such as would create inflation, but would move upwards with the expansion of the economy. I am all for growth, but I shall have something to say in a moment about its limitations. That is in outline the kind of policy that I should like to see this country accept. I should now like to deal very shortly with two or three of the criticisms which I know will be raised.
The first criticism is that if you have an incomes restraint which goes all the way through, you destroy incentives. To that I would say that if you have any kind of restraint—and the Government themselves are in favour of a progressive downward restraint—then to that extent you destroy incentives. But at least my policy is better than a flat freeze which destroys incentives right through without regard to the possibility of limited increase in most groups. It allows for increases all the way up within the norms, but I should hope that at the very high levels the norms would be nil; that is to say, that there would be no further increases. It also makes the restriction heavier in the higher ranges of income where, after
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all, there are very many more other incentives, where work in itself tends to be very much more interesting and stimulating, and where people work for many other reasons—for the power and the interest and the fascination of what they are doing, as well as for the money.
I have not said much about growth, except to express agreement with those who want to see it and who emphasise its importance. A growth of 5 per cent. per annum would be fantastically great compared with anything that we are in sight of, but that is not the scale of wage increases that people are talking about. At present they are rejecting 8 per cent. and 9 per cent. with scorn. Therefore, if we rely on growth alone we must go very slowly and gently, and disappoint a great many current expectations.
I have not said anything about prices. You can cut into the wage/price spiral at either of two points. You can cut into it by controlling wages and other incomes, or by trying to control prices. If you have an incomes policy which controls increases in everyone's income, then it may very well turn out—and I hope it would—that prices will look after themselves because nobody will have any interest in putting them up. If it did not work out like that, we should have to add a prices policy. But I prefer to start with incomes for this reason. There are 22 million income receivers in this country, and we do not all buy one thing; we all buy an enormous number of things. Therefore the complexity of a prices policy is even greater than the complexity of an incomes policy. Furthermore, there are too many ways of cheating with a prices policy; for example, by slightly altering the contents of the article, by slightly altering even the scale of the article in spite of the various protections for the consumer which now operate in law. So I should like to try having a universal incomes policy with norms for each income bracket, with 100 per cent. taxation if you go above your norm. You get all you can within your norm, but you get nothing above it.
Fifteen years ago, when these topics were not nearly so much in the public mind, I published a book in which I wrote that in the field of incomes policy alone we are expected to believe that it

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is best to leave public issues to be decided by organised private interests. The kind of policy that I have tried to suggest to your Lordships this afternoon is the result of the intervening 15 years' experience, unhappy experience, in which I have reflected upon what happens when you allow the vital public interests about which the right reverend Prelate spoke so eloquently to be decided purely by private interests. I hope that at least I may have succeeded in commending to your Lordships that we abandon that attitude of mind and that we accept some kind of incomes policy (I would prefer my own version, but I would put even before that the importance of accepting some kind of general incomes policy) as part of the normal social and economic structure of the country.
5.21 p.m.
LORD BROOKE OF CUMNOR: My Lords, I am sure it is timely and right that your Lordships should have this opportunity to discuss the Wilberforce Report, and I think we should all be grateful to the noble Lord, Lord Shepherd, for giving us the chance. I confess that I thought the noble Lord was myopic in some of his expressions of view, and yet, when one comes through to conclusions, I found a good deal in his conclusions that I could accept because I was reaching the same points through a different route. Indeed, one of the striking facts about this debate is that, except for some slightly provocative debating points which have been made, there certainly is an underlying consensus in all quarters of the House about many of the matters which we have been debating. I think we owe that in large measure to the excellence of the Report of the noble Lord, Lord Wilberforce, and his colleagues. I must say that I found their Report to be of incomparably higher calibre than most of the Reports of the Prices and Incomes Board that. I read. It seems to me that the noble Lord and his colleagues have set us a standard which it will be extremely hard for anybody else in similar circumstances to attain in the future.
I listened with intense interest to the speech of the noble Baroness, Lady Wootton of Abinger. I am bound to say that I doubt whether her detailed regulatory plans would be applicable to so
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complex a society as ours. I doubt whether they would be either practicable or acceptable. Nevertheless, I enjoyed hearing her make this Socialist speech, and enjoyed particularly her pointing out that the majority of the Socialist Party did not seem to be prepared to go along with her.
I was grateful to her for mentioning the letter which appeared in The Times the other day signed by the noble Baroness, Lady Sharp—a letter which, it seemed to me, attracted less attention than it deserved. What the noble Baroness said in that letter was that it surprised her that there did not seem to be thought to be scope for a purely fact-Ending inquiry of high and independent quality in the early stages of an industrial dispute. There may be resistance on the part of one side or the other to having an inquiry which is going to end in recommendations, but when I read the first part of the Wilberforce Report and see how much material it has brought out, not only for myself but, I believe, for almost everybody, which had not been presented in such clear, concise and convincing form before, I cannot help wondering whether there might not be scope in a number of industrial disputes for an inquiry of that sort, which should take place at a very early stage but should not end in specific recommendations. I think most of us could read off the lines of our own conclusions from the first part of the Report, aid I doubt whether they would be very far distant from the recommendations of Lord Wilberforce and his colleagues. At any rate, one thing which has come out of this debate is that we all agree that the Court of Inquiry did a first-rate job.
As to Lord Shepherd's Motion, I should have preferred that it had read, "implications for an anti-inflationary policy" rather than, "for a prices and incomes policy". I am more and more doubtful of this phrase "prices and incomes policy". It seems to be used by different people to cover a multitude of different conceptions. Indeed, the noble Baroness just now detailed at least three, all of which might be called a prices and incomes policy; and a demand for a prices and incomes policy can thus cover demands for a great many different animals. If we can achieve an anti-inflationary

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policy, which will always be wider than any prices and incomes policy, and if we can achieve economic growth, the resources now unused will be called into use, and unemployment (the third reference in the Motion) will fall.
On the subject of unemployment, we are all indebted to the right reverend Prelate for what he said from his experience of the County of Durham on the personal side. There is always a temptation to use in economic argument such phrases as "poverty", "unemployment", and so on, without always thinking out the human reality of what we mean. Words can be used like counters in the economic game. Yet when one has seen large-scale unemployment, as I saw it in the County of Durham before the war, one realises that that is something utterly hateful which must be avoided at almost any cost.
My Lords, the Wilberforce Inquiry rightly said that discussion of total cures for inflation went far beyond the scope of their terms of reference. But within their terms of reference they found two facts to be clear: first, that Britain is in a dangerous condition of spiralling inflation; and, second, that the avoidance of action leading to an increase of inflationary pressure is at the least not inconsistent with a successful overall anti-inflationary policy and, more probably, a necessary pre-condition or accompaniment of it. If I may put that in my own words, the ending of pay claims which go much beyond the growth of productivity, and resistance to claims of that sort if they are actually made, may not be a complete remedy for inflation, but is an essential element in the remedy. That seems to me the main theme of the Report; and I believe its strongest implication for all the subjects mentioned in this Motion is that a readier recognition of responsibility is needed throughout the whole nation.
Politicians and economists—I am the first but certainly not the second—talk a great deal in terms of controversial proposals and counter-proposals, and most of it goes right over the heads of ordinary people. What is really needed throughout the nation is a change of attitude; a change to a belief that prices can be checked, and that the standard of living of everybody will progressively rise provided
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everybody is prepared to forgo short-term gains for the sake of long-term advantage. I know well that that is making the task seem an easy one, whereas it is exceedingly difficult, as the noble Baroness said in her speech. But, nevertheless, what everybody in the nation is asked to give up is not the long-term gain but the short-term advantage. We can most of us school ourselves to do that in our own lives; in wider circles the question is whether we can trust everybody to do it. There is the rub. I myself believe that a generation hence economists will be unanimous that the general standard of living of the British people, and certainly of those with middle and lower incomes, would have risen faster in the 1950s and 1960s if there had been no strikes, no "go-slows", no disruptions, and thus probably no balance-of-payments crises, and if, instead, there had been ceaseless pressure by the trade unions on management to adopt new ideas and new methods which would give their members more worthwhile jobs and a greater sense of belonging. After so many years of almost continuously rising prices, it is not going to be easy to generate a sufficient change in attitudes—and a positive act of generation will be needed.
It is in time of danger that attitudes can change or be changed. There was an opportunity, I believe, at the time of the last devaluation of sterling, if someone had struck the right note to pull the nation to its feet. No nation likes to see itself slide downhill. A great many people in this country in all walks of life are suspecting that we are sliding downhill at the present time. But that opportunity, the opportunity at the moment of devaluation of sterling, was missed; and disbelief in there being any value in struggling to escape from inflation may become further ingrained with every year of rising prices.
So we have the situation described in one sentence of the Report which, with your Lordships' permission, I will read. It is a very long sentence, but that is the doing of the noble Lord and his colleagues and not mine:
"Although it may be coming to be better understood that general wage demands in excess of the increase in national output are likely to be self defeating and to create social inequities, and if persisted in at accelerating rates may lead to governmental intervention, there are still many who believe that inflation, at least moderate inflation, offers a means of

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increasing real earnings, i.e. of improving their standard of living, and it will require a long process of communication, or possibly painful experience, to convince them of the contrary."
I hope that it can be done by communication and not by painful experience. The electricity workers have in fact been through a painful experience; the Post Office workers seem to have been putting themselves through a painful experience these last six weeks. But the retired people and all the people in a weak bargaining position are going through a painful experience perpetually, for every price rise in the necessities of life is for them a wound in the flesh. We cannot shrug off the pain of the elderly by anaesthetising ourselves with the thought that, after all, their pensions can always be increased; for the creation of money to give higher pensions not covered by contributions is inflationary, too.
I believe that one of the gravest symptoms of our present national sickness is the falling away in investment and investment prospects, and I am a little surprised that more has not been heard of this in the debate this afternoon. Why should anyone build a new factory or replace out-of-date machinery with new, if he assesses the chance of a return on the investment as slender? We have just had a spectacular example of that in the Ford decision not to build a new factory in Britain. Yet I do not see how we shall extricate ourselves from our present inability to escape from over-high wage demands which lead to higher and higher prices, until employers, trade unionists and their leaders, and indeed all concerned, regain confidence in new investment and economic growth as the one practical road to a higher standard of living for everybody.
It was reassuring to hear the noble Earl, Lord Jellicoe, committing the Government to a policy of growth. The escape from our present danger, whether it comes soon or late—and I pray that it will be soon—in the end is only going to come through total commitment by all concerned to end it. A declaration of intent is only of value if everyone associated with it genuinely intends; and, as the noble Baroness pointed out, the trouble is that those who do really intend harbour some doubt whether the other signatories of such a declaration intend equally; and so the ground underneath begins to quake.
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Individual unions will not moderate self-seeking policies until they see that a national drive for industrial expansion and modernisation is on the way, with solid rewards for increased productivity. I thought the Wilberforce Inquiry was so right to stress the necessity for the industry to make faster progress with incentive bonus schemes as a means of fostering the idea of advance and higher efficiency leading to better income; for everybody concerned. Businessmen will not find the money for new investment unless they are convinced that the Government of the day is out to create conditions more favourable to profitable investment than in recent years. Nor will they go ahead if they can see no protection against disruption by Communists and wildcat strikes: nor, I must add, if great unions enter into agreements and then ignore the arbitration provisions in them—behaviour which the Wilberforce Report said it could not condone.
My Lords, what can the Government do? They must never tire of repeating that inflation and rising prices can be checked if there is a general will to do it, and if all in positions of responsibility are prepared to take into account not only their sectional interests but the public interest, too. On that, I thought that Mr. Scanlon set a deplorable example when answering questions last Monday.
But the Government have practical duties as well as general ones. I believe, for instance, that they must make a more determined effort to bring down the medium and long-term price of money. I noted what the noble Lord, Lord Robbins, said earlier, arguing that, in relation to the pace of inflation, interest rates were in fact at the present time low and not high. Nevertheless, that does not seem to me to be a situation in which we lastingly can acquiesce. We cannot encourage industries to borrow money at rates which assume that 8 per cent. per annum inflation is going on for years. I cannot see logic in arguing that the medium and long-term rate of interest must remain high on account of the overwhelming demand for capital in these modern days, or on account of an endless prospect of prices rising and the value of money falling, and simultaneously saying that the rate of private capital investment in this country is much too low. May it not be that the current price of

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capital is so much too high for the nation's good that risks must be run in seeking to bring it down?
All, in every position, must answer the call to take risks if the nation is to recover. The Wilberforce Report has been the motive for this debate, and there is nothing more memorable in it than its statement that:
"… the country is at present in a dangerous condition of spiralling inflation … a state of affairs which undermines, almost from the start, the real benefit of the wage increases sought, creates social injustices and resentments, and which if continued will threaten our balance of payments and destroy the value of money".
I cannot believe that we as a nation have not the collective will to pull ourselves out of this mire, and to impose the discipline of stern public opinion on any who decline to co-operate in the effort. For it is public opinion, I believe—the attitudes of mind of the great British public—which will determine these matters in the end.
5.40 p.m.
LORD GEORGE-BROWN: My Lords, I had some difficulty in resisting the temptation not to impose myself upon the attention of your Lordships this afternoon, but I successfully overcame it simply because I have had the experience of walking this way once and it impressed itself deeply on my consciousness and upon my memory. If your Lordships will allow me, I should like to voice a few reflections, partly arising out of the experience of 1964 to 1966 and partly out of the issues which the Wilberforce Report raised; and especially—if the noble and learned Lord, Lord Wilberforce, will not mind my saying so—because of the issues that arise out of the addendum, the Note of Reservation, written by Mr. Jim Mortimer.
I have listened to a fair amount of the debate. I was, if I may say so, slightly amused by the reference from the noble Lord, Lord Brooke of Cumnor, to the fact that the debate had been so far, so good; up to the point where provocative debating points were raised. If I may say so, I could not have provided a better summing-up of his speech. What the noble Lord had to say about money I thought was perfectly all right; but some of the other things, I thought, came into the area of provocative speech.
LORD BROOKE OF CUMNOR: My Lords, what I said was not what the noble Lord has represented me as saying—but no matter.
LORD GEORGE-BROWN: My Lords, whatever it was that the noble Lord intended to say, that is exactly how it came out; he must have a little word with his own recording apparatus. Two speeches impressed me. Those speakers I know well, my noble friends Lord Shepherd and Lady Wootton of Abinger, I should expect to be good. But there were two speeches which really impressed me. One was the speech of the noble Earl, Lord Jellicoe. I am sorry he is not now in the Chamber, but I would have said this had he been here, so it does not really matter. I thought the speech was very sad. It was a speech about something which the noble Earl really did not know about, which he did not understand. He read, somewhat inadequately; and when questioned, quite relatively, by my noble friend Lord Shepherd he simply did not know (a) what to answer; and, (b) how to fit it in. My Lords, whoever wrote that speech wrote it with a degree of cynicism which I deeply regret, because the subject is a matter of such tremendous importance.
The other speech which impressed me was that of the right reverend Prelate the Bishop of Durham. The right reverend Prelate comes from an area of the country which we all know very well and where we have seen the deepest possible tragedies occur. I refer not only to those which occurred long years ago when I was young, when enormous, grossly enormous, unemployment threatened the area, but also those tragedies of recent times, which are more relevant to what we are talking about. I have been to the Durham Miners' Gala for I do not know how many years. I have seen the number of bands and banners, once bravely carried, gradually diminish. That meant that pits had been closed as a matter of deliberate economic policy. I have therefore cause to reflect on the fact that the issue we are discussing to-day, the implications of the Wilberforce Report on a prices and incomes policy, goes much wider than the noble Lord, Lord Brooke of Cumnor, said; much wider than an anti-inflationary policy. It is part, and it has to be part, of a great, positive policy which sees that in regions like the North-East

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—where it is quite proper, it may be, to close the pits—there should be other job opportunities, other things brought to the workers. Prices and incomes is a part, but only a part, of a much wider policy. I thoroughly enjoyed the speech of the right reverend Prelate because he brought out all this.
I am trying to say, my Lords, that the issue which is appended to the Wilberforce Report—although, to be truthful and honest, it goes all the way through, as the noble and learned Lord himself said only he did not pronounce on it as a Committee, because he did not accept that it was really the task of the Committee; but he did not toss it aside; he left Jim Mortimer to say it at the end—raises the central issue for an economic policy, and I have seen it in that way. I repeat, it is not just an anti-inflationary vehicle. It is not just a way to seek industrial harmony. Both are tremendously important and both, if we could but find our way to them successfully, would contribute. But neither is the reason why we are trying to find a policy.
Incidentally, this did not all begin in 1964. I have said before in the other place that I have on my bookshelves a very interesting little book called The Clydesiders. I am tempted to recall this on seeing that my noble friend Lord Shinwell is in the Chamber. The book contains an account of the days when a very radical, not to say revolutionary, band—a frightened band of people—arrived at Westminster for the first time. It is an excellent little book, my Lords, and I commend it to your attention. The interesting thing is that one of the things in that book is a treatise by John Wheatley—who was one of the Clydesiders—on the importance of a prices and incomes policy and how to work it. One of the Clydesiders had worked it out as long ago as that. When I first came into the other place, in 1945, the noble Lord, Lord Shinwell, in his then Ministerial position—which had nothing whatever to do with this subject, in a sense, in a direct political way—was himself busily engaged in circulating papers (I still have vivid recollections of them) to his colleagues and to anyone who was interested, trying to persuade them that prices and incomes were the central policy to any much wider-ranging things that we wanted to achieve.
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My Lords, we shall not get economic strength, we shall not get economic expansion—I am trying hard not to use that awful word "growth"—we shall never get greater industrial production unless we can produce, as one of our arms, a planned relationship of prices and incomes to the rate at which not only our overall production but also, and above all, our productivity per man hour and per machine hour is rising. This illustrates the critical importance of getting a prices and incomes policy. This is why, when the noble Lord, Lord Collison, and others, and I, produced the Declaration of Intent, we deliberately set it out as a productivity, prices and incomes policy. I think we shall be saved some of the misconceptions about what it is if we always spell it out in full. We were saying that production can rise at such and such a rate—whatever we agree that it should rise—and provided productivity (and, I repeat, per machine hour as well as per man hour) rises at a given rate, all incomes, as the noble Baroness said, not just the incomes of those of us who are on the wage book or the salary book, but all incomes, should be related to that. The increase in incomes is related to that; and price increases, which there must be, are also related to it.
To bring it about my Lords—and this is where I move to what I wanted to say; because I think your Lordships will have said most of the other things—one has to try to relate it as part of what I would call the overall economic and social strategy: to what we are going to do in other directions; how we are going to influence and affect investment; where we want to see industry located; if you like, to what part we play in the Continent of Europe, and how; to where our exports strategy is directed to; what we are going to do about social benefits and how much we want to retain for what is called social spending out of what is produced. To get on to one of my old hobby horses, are we going to slop the Treasury from persuading all Ministers—at any rate, all Treasury Ministers—all the time that if it is socially, communally, spent it is bad, but if it is privately spent out of your pocket it is good: the purely transfer payments where you take out of the pockets of

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some people who can afford it and use it to raise the social standards of other people who need it but cannot afford it. That is not spending; that is a transfer payment, and a different matter. We have to relate this to our whole economic and social strategy, and all parts of it have to fit and to be seen to be complementary. Otherwise there is no climate in which anybody is going to look at the spending of incomes.
If I may put it negatively, it seems to me that you cannot plan for a reduction in job opportunities, which, whether the Treasury Ministers understand it or not, is precisely what the Treasury and those who run our economic affairs are doing at this moment. We are speaking against the backcloth of 720,000 unemployed. Make what allowance you like for the temporary—as we hope; and it is a big hope—effects of the Rolls-Royce and other issues, it is an enormous step on the way to the magical figure of one million. This is either being planned for positively or being planned for negatively, in the sense that Ministers are content that it should happen.
You cannot withdraw the necessary Government intervention and influence which the right reverend Prelate spoke about—drop the word "control", because it is evocative. You cannot withdraw the necessary Government central control. You cannot, as a matter of policy, withdraw deliberately the support which private industry needs. I have never been as passionate a nationaliser as some of my friends; neither am I a passionate believer that private enterprise can live all by itself. I happen now to spend most of my life with private industry. I know, I daily see, how much private enterprise needs Government support. You cannot withdraw it and at the same time increase the restraints of finding the cash and the credit which is needed for financial activities, and expect an acceptance of prices and incomes control.
I see the noble Lord, Lord O'Neill of the Maine, in his place. I will not embarrass him by saying that I thought he was one of the two best Prime Ministers there could have been who divided Ireland. If only he and Jack Lynch had managed to go along together, I think we should have avoided the present situation. But that is an interpolation.
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The noble Lord is going to address us in a moment. He knows only too well—I am sure he will say it, without my provoking him—that to get industry to go to Ulster, even when there is no violence and no unhappiness, requires a degree of support from the central Government; it requires a degree of injection of actual cash—pennies falling in the till—as well as allowances against hypothetical profits over three years, if it is to happen at all. New people are not doing it now.
I was seeing yesterday somebody well-known to the noble Lord, who was asking me whether those who were already there would go on being there. I did my best to give him reassurance. But he asked me a question that I could not answer: Would anybody who is not there go there now that the Government have withdrawn all these things? I say that you cannot do what, with respect, Her Majesty's Government are doing, and expect companies who are now divorced from access to cash and from other forms of support not to nut un prices. How else in such a situation do you get the cash? You cannot expect workpeople, whether manual, really skilled or technicians and salary earners, to support prices and incomes restraint when they know that job opportunities are being reduced as a result of these policies.
I must say that if we are to discuss this subject seriously in your Lordships' House, and not as an academic, polite exercise—I am not doing this as a Party exercise; I play little part nowadays in Party politics—the fact of the matter is that it must surely seem that virtually all the Government's economic policies are mistakenly directed. If anybody would rather hear it from somebody other than a Socialist, as I am, I commend to them the Guardian leader this morning which says:
"Virtually every one of the economic policies is misguided if we want to go along the direction of involving our people, preventing inflation and getting an expansionist policy."
Anybody can say that when I was Minister for Economic Affairs I failed. So be it. I tried. It is in the power of every one of us to try; it is not in the power of any one of us to command success. But I think it would be much better if the Government looked for the reasons why I failed and avoided them, instead

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of making all the mistakes that our Government made and then adding a whole new lot of their own. Some of the mistakes that we made under the pressure of Her Majesty's Treasury are still being made; but the present Government are also making other mistakes that we did not make. That is really where they ought to be looking.
I wonder, in the context of this debate, whether the present Ministers ever regret helping us so little when we were trying. I could, of course, had it been worth one's while, have turned up "oodles" of quotations. I did not. But I was just handed one, which I did not turn up: my brother, the Member of Parliament for Finsbury and Shoreditch, turned it up. It is a quotation from a speech made by Mr. Carr, the present Minister, on May 21, 1968, and in the light of the sententious remarks that have been made here to-day from the Conservative Benches I think it is worth reading just one small passage.
"One of the hallmarks of freedom is surely the right of people to determine their own earnings without State intervention or direction, whether they do so by collective bargaining or by individual negotiation".
To that Mr. Hugh Scanlon says, "Hear, hear!" To that Mr. Jack Jones says, "Hear, hear!" This is one of the problems that my noble friends Lord Collison and Lord Cooper of Stockton Heath have. This is the doctrine which the present Government, when they were not the Government, preached. It is very hard for them to get back from it now.
May I, my Lords, give some examples, very briefly and shortly, of the mistakes that I think the present Government are making? Some were ours, but I will deal with the ones that the present Government are making separately from those that we made. I know that the Prime Minister prides himself on not having "instant government", and as one who has suffered from a period when we did have it I should have applauded him had he stuck to his resolve. The instant decision to abolish the Prices and Incomes Board: does he not regret that now? It is all very well for the noble Lord, Lord Brooke of Cumnor, to say that the Report of the noble Lord, Lord Wilberforce, is better than anything he has ever seen from the Prices and Incomes Board. Well, the Government could have
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replaced Mr. Aubrey Jones with the noble and learned Lord, Lord Wilberforce, if they had thought that that would have done any good. Do not the Government now regret taking this decision to abolish the Prices and Incomes Board, and to leave themselves with no instrument at all? Then the abolition of the Industrial Reorganisation Corporation. Do not the Government regret this hurried decision to get rid of a very useful instrument, where hardly a Socialist tainted its upper echelon? All it was doing was to help private industry, private enterprise, to be able to do the job which everybody in this House, almost without exception, believes ought to be done.
There are the Government's monetary restrictions; the extent to which they are making it impossible to get finance to do the most essential things. Some textile mills and woollen mills still need reorganising, and some of their machinery needs replacing. People have entered into commitments to do it, but Her Majesty's Ministers make it impossible to get at the finance to deal with it. I.C.I. borrowed £40 million at about 11 per cent. Other enterprises are currently borrowing, where they can, and if they can, at 8 per cent. or 9 per cent. How much do they have to make, and how soon, to service borrowings at that level? It is possible for a certain number of vast corporations to do it. If I were a shareholder of one of them—happily I am not—I should be asking some pretty urgent questions at their meetings about whether they can do it. Maybe they can get away with it. But a great many of middle-sized vital, traditional enterprises in this country simply cannot do so. The monetary restrictions are one of the biggest mistakes the Government can make. We have the surplus. The noble Earl, Lord Jellicoe, was eloquent about the problems he thought that he had inherited, but at least he inherited the surplus.
LORD ROBBINS: My Lords, will the noble Lord forgive me if I interrupt to put a question which might help him to elucidate the point that he is trying to make? Would he not agree that in all countries where great inflations have occurred the rate of interest on money has been very high, whether or not time were Treasury officials operating in the sinister way in which he suggests?
LORD GEORGE-BROWN: No; they were sometimes economists who had moved down to Fleet Street and who had a rather larger influence than they ought to have. I do not reserve my comments wholly for Treasury officials. The answer to the noble Lord's question is, Yes, I do. These things, oddly enough, go together. I understand that the noble Lord will follow me, and perhaps he would like to explain which, in his view, is the chicken and which is the egg.
Then there is the withdrawal of investment grants. I have already referred to that. What a mistake! As the Guardian said this morning, could it possibly have come at a worse time when the Government are restricting other forms of cash flow? Then there is the regional emphasis. This is what the right reverend Prelate was talking about. We may be producing unemployment all over the country: I will give the Treasury their due; they are not necessarily selecting only the North-East, they are doing it pretty widely and in a catholic way (if the noble Prelate will not mind my saying so, as one Anglo-Catholic to another), in a universal way. But when they do it in a universal way it tends to hit certain areas harder. You get 7 per cent. unemployment in Ulster—I am "clued up" about that only because I was briefed yesterday about it. You get more than the normal unemployment in Wales and in the North-East just because that is where it hits first. If I am a manufacturer and I set up a peripheral factory in one of these areas, and "times is hard", as they say, it is the periphery that I deal with, not the main centre of operations.
Then there is the acceptance of vastly rising unemployment; the acceptance of the drift into bankruptcy; all that "lame duck" stuff must have sounded good. I have been through many an Election, and far be it for me to say that you should not the week after you have won say, "Well, maybe that is what the Daily Mail reported that I said, but"—like the noble Lord, Lord Brooke of Cumnor—"I did not actually mean it to come out the way it came out"! There is always the moment for reconsideration. There is all this "lame duck" stuff. So we put Rolls-Royce into bankruptcy. I cannot help feeling that the Government mixed up Rolls-Royce and Rolls Razor. V. and G. were allowed to go yesterday—
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rightly or wrongly; I do not know the ins and outs of it. Both events have tremendous spin-off effects, if I may use that jargon. The newspapers tell me today that Alfred Herbert may be going the same way. Is this sensible government, creating the climate that we want? I think not. This is not a polemical point; it can be checked, and the noble Lord, Lord Robbins, knows it better than most.
It is all leading, as I personally know from my day-to-day experiences, to reduced investment, because people are beginning to pull in. It is leading, therefore, to the reduction of immediate production and to reduced future production. The reduction in future production will be even worse. This is leading to rising costs. It is not much use saying piously, "We want to get costs down", if you are under-using machines, under-using your capital assets as a matter of policy; if you are working them three days or four days a week instead of 24 hours a day, seven days a week. Costs must rise, and they are doing so.
To come back to the point about the implications of the Wilberforce Report on prices and incomes, it is, above all, creating a climate of fear. When men become frightened—whether they be City financiers, company chairmen, middle-level managers or fellows on the shop floor—they act irrationally. I personally think it is absolutely stupid that when somebody shoves a £3-a-week increase into a man's hand he should go on strike. It is stupid. But then I am not faced with the problems he is looking at. I have not the fear he has. As I say, when men become frightened they do stupid things and act irrationally; and all the judicial, theological or political lectures do little good in such a situation. This is what Her Majesty's Ministers' policies are creating.
People now think, for example, that work sharing is more important than redeployment, rationalisation and productivity deals. A fellow does not want to be redeployed if redeployment means the local labour exchange, especially if he is in his fifties. He does not want to rationalise if rationalisation means that there are jobs for 200 where there used to be jobs for 300. He does not want to do a productivity deal if it leads to

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the same things. But we are increasingly facing demands for work sharing: four days a week for all of us is better than five or six clays for only half of us, and the rest on the dole.
In this climate, higher and higher wage claims (I commend this point to the noble Lord who preceded me) appear desperately urgent, just as the raising of prices seems desperately urgent to industrial enterprises. Everybody wants to get in before the real crash and crack-down happen. It is not thought that it can go on for long. People do not think any Government can tolerate the situation for long, and so they want to get in first; and this is necessary enough because otherwise they may not get in for another year or two. So up go prices by 10 per cent., 15 per cent. or whatever it is, and chaps will not settle for 3 per cent.; they want 8 per cent. or 10 per cent.
It is not only to take retrospective account of what they think they are suffering from, and to cover what they need now: they want to make sure they have something in hand. We may think it horrid, stupid and wrong, but then we are, by and large, a rather privileged group of people. The chap on the shop floor or an industrial price fixer cannot think that way now. The Wilberforce Report brought out very clearly indeed (I say this without patronism) the questions which this situation poses for those trade union leaders who are—I will not say "moderate", because that is not a nice word to use, but clear-sighted and far-sighted and have been trying to look ahead.
I was most impressed by that part of the Report which quoted the shop steward's evidence from a power station. It was very moving because it was obviously so right, sincere and clear, and not over "tarted up". It showed the problems which a far-sighted and clear-sighted trade union leader faces when he exercises what the noble Lord's Report calls "Cannon courage"—the rather special Cannon courage. One finds oneself up against tremendous problems from men who think one is taking them too far before they have got a real return. It puts a premium on "militancy"—and I put that word in quotes. It is very hard, then, for any trade union leader (ask any of those trade union leaders
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who are in your Lordships' House) to opt out, once militancy becomes the order of the day. The trade union leader who opts out is opting for such destruction and disorganisation that he may not be there himself very much longer; or, even if he is there, he will not be able to exercise very much influence because other leaderships will take over from below.
Still, my Lards, this is no excuse (may I make it quite plain, because everybody misunderstands me?) for trade union obduracy, obscurantism or downright bloody-mindedness", all of which, to a greater or lesser degree, exist. But so they do in management. And so most clearly do they in Government. Just as Government have the greatest role, so their responsibility, in my small judgment, for what is happening must be just and more sincere. Moving, as I now do, so much more in industrial circles than in those of politics, may I say just this to the Treasury Bench? I can assure Ministers that they will find their most astringent and frustrated critics, not among the strikers and the marchers, but in the management offices and the boardrooms of our most progressive industrial enterprises, so many of whose aims and plans are being postponed, cancelled and generally brought to naught.
Of course we need a return to sanity—but we need it all round. We can succeed as a nation economically only if that happens; and trade unionists—and I say this to my fellow trade unionists—need it as much as any, especially the lower paid and the weaker brethren among them. There is really no "we" and no "they" in this matter. But I believe—and this was the purpose of what I had to say—that there is a prime necessity for a major re-evaluation and reversal of basic Government policies. Otherwise, my fear is that we shall have still further conflicts in addition to the ones we have afflicting us to-day; we shall have further escalatory, inflationary demands and actions, involving costs and prices as well as incomes. We shall have yet more commercial crashes. We shall become a generally less competitive economy, and we shall face an ultimate major confrontation. And, my Lords, anybody who is tempted to face a major confrontation with equanimity or complacency; anybody who says to himself

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(and I hear this said), "Better to have it out and get it over", is in my view too foolish and too dangerous to be tolerated in his authority.
6.18 p.m.
LORD ROBBINS: My Lords, first of all I owe an apology to your Lordships' House and to those speakers who are to come later in the debate for the fact that, owing to an engagement made some weeks ago, I shall shortly have to quit my place in this Chamber. I am grateful to the Front Bench for having allowed me the opportunity to speak at this stage in the debate. It seems to me that there can be considerable debate among serious minded people about the quantitative implications of the recommendations of the Committee of the noble and learned Lord, Lord Wilberforce. Are we to take the 10·9 per cent., which has been quoted in Government circles, as a proper measure of the increase, or are we to assume, as has been assumed from time to time in the discussion this afternoon, that it was a substantially higher figure? Personally, I am inclined to the latter view. I find it difficult to believe that the so-called lead-in productivity incentives are to be ignored when we are trying to estimate the net effect on aggregate expenditure in relation to output of what was recommended. I therefore tend to think (and I regret to say it) that the award in fact somewhat increases inflationary pressures.
But be that as it may, the salient fact of the situation is that even if the lowest figure be taken as authentic, the probable effect is still inflationary. The annual rate of growth in the economy at this time is not more than 3 per cent. per annum. A rate of increase of incomes, even if restricted to the Government's target of 8 per cent., would still exceed this rate of growth by 5 per cent.; and of course we know that in fact earnings in general are rising by much more than 8 per cent. per annum. It is therefore surely no accident that prices are rising at a rate probably exceeding 8 per cent. per annum. The Economist last week hazarded a guess that they would soon be rising at 10 per cent., and I see nothing in the situation which suggests that that conjecture is unwarranted.
This is a very grave situation. It is graver, I believe, than anything with
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which we have been confronted in the last 25 years. If we project this rate of inflation for another five or six years, our money will have lost a third of its purchasing power. If it goes on for ten years it will have lost half its purchasing power. I will not expatiate on what this implies to those of us who live on fixed incomes. There must be some, even in your Lordships' House, who are wondering whether their present expectation of life will expire before they are reduced to the lowest level of State-supported indigence. But I will emphasise the effect on culture. There can be no university, no institution for the purveyance of the higher branches of art or music, or drama, whose way of life, whose plan, whose very existence, is not threatened by such a development.
Nor should one neglect the effect of inflation in industry and production. In the demand-inflations of the past, profits tended to flourish, at any rate for a time, even though in the end liquidity complications usually set in because of deceptive accountancy and the catching up of public expectations with what was happening behind the public's back, although for the time being, if you have a demand inflation, there may be positively beneficial effects upon investment. But in cost-inflations profits are squeezed from the outset, and we see already to-day—and in this at least I can feel in harmony with the noble Lord who preceded me—the effects on investment of declining profit margins. If this goes on, let there be no doubt that the rate of growth, far from increasing, will be even slower than it is to-day.
I would add—although in the last analysis I should regard this as a secondary matter—that since I do not believe that the rest of the world will go on to inflate as rapidly as we are inflating at the moment, I do not believe that we shall be able to hold the much vaunted surplus in the balance of payments very long. If the present inflation goes on, the surplus in the balance of payments will be gone like the snows of this afternoon. There is nothing but trouble ahead even if the rate of increase in incomes is kept down to the Government's present target figure.
What are we to do about this? It is inconceivable that any Government in

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this country should allow such a situation to continue. Despite all our mistakes, made, if I may say so, by all Governments since the war; despite our unwillingness, widespread among the public, to face facts, we have not yet acquired Latin-American habits. Men of good will of all Parties want to break out of the vicious circle. The question is, how? There are some, I know (the noble Lord who preceded me, for instance), some whom I greatly respect, who place their hopes on an increase in production, aided and abetted perhaps by dedicated efforts such as we should all wish to acknowledge in his own past history, and perhaps unimpeded by the baleful influences in Great George Street. But I am afraid this is self-deception. Of course an increase of growth, other things being equal, would help.
Supposing that the gap between the rate of inflation and the present rate of increase of earnings were (shall we say?) 1 or 2 per cent., I would not say that we could not hope for salvation this way. But we must have a quantitative perspective here. The gap is not of that order. The gap is much more likely to be the difference between 3 per cent. and 13 per cent. I ask seriously, does anyone in his senses believe that the gap can be quickly closed in that way? The most that we have achieved in recent years in the way of an annual growth rate has been between 5 and 6 per cent., which is not more than half way in the right direction. And remember that these accelerations, taking place in periods of what might be called ultra-full employment, did not last.
Moreover, I would say—and I say it with regret, knowing that what I am saying will be antipathetic to many whom I admire and respect on the Opposition and the Liberal Benches—that I think there is a real danger that in seeking to stimulate growth by indiscriminate financial measures, the net effect might easily be to increase the gap between aggregate demand and production and so to move to a further increase in the rate of inflation. I am not against growth—heaven forbid!—but in the present circumstances I urge your Lordships to realise that with the inflationary gap of the size that it is at the moment, to rely upon growth as the main cure is to rely on wishful thinking.
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My Lords, it is surely equally clear—or should be equally clear—that this is not a problem to be solved by widespread changes in the industrial structure. In my young days, when I thought of myself as a revolutionary socialist—a very mild and inoffensive one, I can assure your Lordships—we used to say that if only one nationalised the means of production, distribution and exchange, all would be well and the problem of industrial relations would be solved. Well, my Lords, we have not gone the whole hog, but we have nationalised a good deal, and I have not noticed that the pressure for wage increases higher than the rate of growth has noticeably diminished in those areas. I would not wish to extenuate employers in the private sector for concessions on a similar scale, but I do submit that the fact that the employer is the public rather than private enterprise is no safeguard against cost inflation, to put it very mildly.
Furthermore, I would add that quantitatively it is equally clear that if all profits were abolished to-morrow, or appropriated for the payment of other incomes, it would not meet claims of the order we are now encountering without a continuous rise of prices. According to the Treasury White Paper-I quote it with some trepidation in the presence of of the noble Lord, Lord George-Brown—the trading profits of companies in the last year for which we have records, after providing for stock appreciation and capital consumption, were only 8·8 per cent. of total domestic production. You cannot meet wage claims, or income claims of any kind, of the sort which are corning forward now, without rising prices. The fundamental problem is that if prices are assumed to be constant, then the current level of claims is asking for more from the machine than the machine will turn out, and consequently prices rise.
So, my Lords, the real dilemma of the situation is this: that given the present rate of growth, or the present conceivable increase of growth in the short period, if the demand for increased earnings adds up to more than this rate, then inescapably one of two things follows: either finance is produced to meet the demand, in which case prices rise, or it is not, in which case, lamentably, unemployment increases. That is the situation, as I see

1411
things, in which we find ourselves at present, and it is not easy to find a way out. The value of money is being lowered month by month by demands on the product of industry which it is impossible to meet at constant prices. And this is, surely, not a position which any British Government can afford to acquiesce in for long.
Now may I say at once that I do not believe that the policy of cutting off immediately, either by monetary or by fiscal means, all sources of finance for the upward movement is either practical or prudent. So violent an application of the financial brakes as that would indeed bring widespread bankruptcy and unemployment, involving all sorts of enterprises which at present regard themselves as moderately stable. And remember, my Lords, that the application of the financial brakes to a rate of increase of aggregate expenditure not exceeding the rate of growth of the economy is not deflation. I must here take issue with the noble Lord, Lord Reay. Deflation, surely, in any intelligible sense of the word, is a contraction of expenditure below the current rate of production so that prices fall or unemployment increases. To restrict the rate of expenditure to an annual increase corresponding to the rate of growth is not deflation. It is indeed the norm of monetary stability which should be the long period objective of us all. But, my Lords, I agree that to put on the brakes as violently as that in the short period would be neither practical nor prudent. So, in principle, I agree with the aim of decelerating the upward financial movement rather than bringing it at once to a full stop by monetary or fiscal means.
But, my Lords, this does not mean that I see the same reason for accepting claims of the present order of magnitude in the market for services. Any grounds for accepting anything beyond the average rate of growth in this connection must be justified by quite different considerations, considerations of relativities in closely connected industries, delayed adjustments in the past, or, as in the obvious case of the police force, exceptional difficulties of recruitment. And I am bound to say that in my opinion even 10·9 per cent. for electricity workers or 9 per cent. for postmen leaves me with little hope of
1412
seeing the rate of inflation reduced in the near future.
Let us be clear about one thing, even though it may not be an immediate guide to policy. If the average rate of claim for increased earnings were no greater than the increased rate of growth, then the solution of this frightful problem would be in sight. There would indeed he a pretty considerable backlog of illiquidity and increased costs to be worked off; but, given the assurance of that degree of realism, I am pretty confident that these difficulties could be surmounted. But how are we to get to such a position? At the moment, the policy seems to be to resist, or to appear to resist, demands which are higher than the still highly inflationary 8 to 12 per cent. level, to resist these in the public sector, to deprecate them in the private sector, and to maintain something of a credit squeeze. I cannot say that I think that this is very drastic; and I have said already once before in your Lordships' House that I do not think it is made psychologically more commendable to the workers by concessions at this stage in income tax, much as I believe tax reform to be long overdue.
I suppose that this policy has some chance of succeeding. One of the senior economists in this country, one who has been right more times than most others about the way in which the economy has been tending from time to time, said to me only the other day that he thought it had a 25 per cent. chance of succeeding. I personally should put it rather higher than that. But of this I feel convinced: if it does not show some signs of succeeding within the next few months—and by success I mean, let me reiterate, incomes rising not greatly more than the current rate of economic growth—if it does not succeed in that sense, then I am inclined to think that some sort of freeze, some sort of incomes policy, will have to be attempted. I say this with very great regret and without very much hope. I am no more convinced than I ever have been that, in the long run, such policies are viable without the loss of many liberties to which the majority of us—and, I venture to say, the majority of trade unionists—attach great importance, or without the growth of evasions and corrupt practices which we should surely deplore.

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I have listened with very great interest to what was said by the noble Baroness, Lady Wootton of Abinger, but I remain unconvinced. I have yet to hear of any variant of incomes policy which stands up to criticisms based either on the experience of such policies in the past or on the general common sense of the subject. A most remarkable article by two young men from the London School of Economics was published in the Financial Times, I think about three weeks ago, which I should have thought put paid to any hope of easy success in this direction. Yet I do not think this community can stand a rate of inflation of 8 to 10 per cent. per annum for long. And if it goes on, then I am clear that we shall have to take some very blunt instruments to deal with it, to provide at least a period in which we may pause and think, and reshape our policies.
But how much better it would be if all concerned were to come to their senses and to realise that the sort of demands which are now being made on the product of industry are impossible of fulfilment without the consequences of either increased prices or increased unemployment! It is here that I cannot help feeling that the performance of the present Government, with all its courage and good intentions with which I sympathise, has fallen considerably short of what might have been wished. The present Government, believe me, have not succeeded in driving home to ordinary people the contradictions of the present position.
In this respect, my Lords, I submit that the public at large are in a state of split personality. They condemn rising prices, but they also condemn the means of stopping them. They deplore the erosion of the power to purchase of the money in their pockets, but they still contemplate with apparent equanimity claims or recommendations for pay increases which make such erosion inevitable. I ask: is it beyond the powers of reason and persuasion to resolve this schizoid condition? Is it asking too much of those who rule over us and at whose mercy we are, is it asking too much of men of good will in all Parties, that they should try to get this fact over to the public? I do not know. But I do know that if this is not got over, then we are in for a very bad time indeed.
6.45 p.m.
LORD THORNEYCROFT: My Lords, I was at the outset a little doubtful, as I always am, about the value of a debate centred on a particular industrial dispute, however able the Report upon it. I have, however, been slightly reconciled in listening to the nature of the debate. More particularly I have been impressed by the fact that, having listened to other noble Lords, I do not think any of us can feel that we can rise with confidence and say that we have a complete answer to the very grave problem that confronts this country at the present time. The debate would have been justified, in my view, if for no other reason than that it gave my noble friend Lord Robbins an opportunity to make the speech which he has just delivered, with all the authority that he commands, and which I thought sketched in very real terms the scale of the problems confronting us at present. I think there is one lesson that I would draw from that speech: that this problem is so paramount among all the other problems confronting us now, that it should be put as a real first priority in Government policies.
This brings me to the two short points that I want to make at the outset. First, we must discard dogma in this matter. Everybody gets committed to various solutions of various problems in this life; but, for my part, if anybody can produce any solution which would contribute in some way to helping to get over the present situation of inflation I would not argue where it came from. Equally, I think the Government have now reached that stage of maturity in which dogma has ceased to mean very much to them. We had the very tragic case of Rolls-Royce. I personally was saddened, but I acknowledge the reality when from the Conservative Benches an Under-Secretary announced that a great company was going to be nationalised. I realised at that moment that dogma had ceased to count, and that reality and what one has to do in actually governing a country had begun to take over. I believe that we have to take the same approach in dealing with this problem of inflation. I do not mind what has been said about what we are going to do about taxation or any other subject; that is irrelevant. A Government at this moment will be forgiven if

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they take a little time to honour some of their pledges. What they will not be forgiven for is if they are in any way laggard in facing the realities of the situation that exists.
The second point I would make is that it is an illusion to think that there are two sides to this squabble (if it be a squabble), or to this issue. We are all, in one way or another, caught up in this net. In any solution finally arrived at, millions of trade unionists, with their wives and their families, will have to acquiesce. I do not mean by that the trade unionists who happen to be speaking at the moment or to be attending an orderly, peaceful demonstration in London: I think of the silent millions of trade unionists who will suffer, as we are all going to suffer if this process continues for much longer. This debate has centred on the power workers' dispute. There are one or two factors about them. As a matter of fact, it is difficult to draw conclusions from one dispute or from one Report; they are all infinitely different.
The power workers' dispute was, I suppose, distinguished by the fact that these particular workers had a remarkably good record in their efforts in productivity. Alas! there was the union's refusal to agree to arbitration; a review which included a consideration of the public interest, and an award which. I must agree with my noble friend Lord Robbins, was on any terms inflationary. It may have been justified in the circumstances; but enormously powerful arguments are required at this moment to justify an award which, by a number of factors, is above the growth rate. I must say that I agree with my noble friend Lord Robbins that, if we are to proceed at this kind of level, it is difficult to see how this policy is going to reach success in time to avoid the dangers which confront us.
The power workers' dispute was distinguished by one other thing: by a turn in public opinion. All my lifetime I reckon that the public have been broadly on the side of strikes; broadly they liked to see people getting a bit more. We have all wanted a bit more. The Press have always come out with the headlines "Government acts", which generally means that the Minister has offered another 4 per cent., or something of that
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kind. I have been in Government myself and I have seen these things happen. For the first time, to my mind, in that power workers' strike public opinion began to turn rather heavily against those who were asking for these wages. Not personally; they had no ill-will against them. But they felt, with increasing force, that the public interest, as they understood it, was not being served by demands of this character. I think a very real anger would face a Government which started to show weakness in this particular field at this time.
My Lords, what lessons are to be drawn from all this? I do not think there are many in the general context. As I say, I do not believe we can find complete answers by taking one dispute. I would say that one lesson is that the Government ought to keep their options open. I have said this before, the noble Lord, Lord Robbins, has said it now, and I say it again, that I think that their policy may work in time. I personally support their policy and I have every wish to see it succeed. There are enormous prizes if it does succeed, and the biggest prizes are for the trade union movement. After all, it is in the free bargaining for wages, in flexibility, in the free play of the market and in individual trade unions bargaining face to face with individual managements, that the essence of trade unionism lies. This is what the trade union movement is about. If we are to lose that and go over to some mechanical alternative, then in my mind and I believe in the minds of many trade unionists who think about these things, it is a little difficult to ascertain what their future role is going to be.
I do not want to spend a long time on the alternatives. The noble Lord, Lord Shepherd, said that he would like to see a national policy for incomes, wages and prices. The noble Baroness, Lady Wootton, said much the same, as did the noble Lord, Lord George-Brown. I would only say—I do not want to be dogmatic—that I could not carry it through myself. I have talked to men who have done it. I remember that years ago I spent some days in Moscow, and I had the privilege of talking to the originators and organisation of Gosplan, which was then the big economic planing organisation in Russia, and perhaps it still is. It was a great privilege. They

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were men of great distinction and ability, and they were very patient with me and answered many questions.
They described how they did exactly what the noble Lord, Lord George-Brown, was talking about. Some production was allowed to rise, in accordance with the way productivity was rising; they were considering output per man-hour and per machine; they were fixing the rates of pay over vast areas. The imagination boggled at the vast economic assumptions that they had to make which underlay decisions of that character. They had great triumphs—do not let anybody underestimate the triumphs of the Russian economy. They had vast disasters, too. If you make a mistake on that scale, it is tremendous. I do not say that these things are impossible, but to contemplate them is a revolution in thinking. Theirs was not a voluntary plan. That somehow or other we could achieve this enormously complex pattern by voluntary means I do not believe is practicable, or at any rate practicable for very long. I shall come to what we may have to do short-term later.
Then what about prices? Even the noble Baroness, Lady Wootton, flinched a bit from that subject. One must have some regard to the realities of the world in which we live. Part of the realities in the little bit of the world where I live is the components in a television set. Just picture what it means to price the components in a television set. And that is a minuscule problem compared to what price fixing really means when you start to delve into it in this country. So I would say to the noble Lord, Lord Shepherd, that there are difficulties about these policies—as there are, let me say, about all policies.
Then the noble Lord says "Let there be growth". Indeed, the noble Earl, Lord Jellicoe, says in effect—and it is one of the good things to say—that we all want growth. All my political life I have been saying that we want growth. It goes better if you stand for growth. It is very difficult to stand against growth. We all want growth. I can think of half-a-dozen things which the Government could do in the next Budget—I am not asking for any reply from the Government—which would encourage growth in areas which interest me very much indeed. I rather share the view
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of the noble Lord, Lord Robbins, but I should not dare recommend a single one of them to Her Majesty's Government at the present moment, faced with the situation which exists in this country. I hope they will be careful; that is all I would say. For heaven's sake! whatever they do, they should forget anything they have ever said about it. Do what is right in the existing state of the economy at this moment. While it is good to encourage growth and it is good to give incentives, it is even better to recognise that there is a wage inflation which is simply taking control out of our hands at the present time. The first thing is to try to get rid of that.
There are a few short points I should like to make about the general handling of the situation as it is at the moment, and about the trade union movement. There are two things which I think will count for a great deal: one is leadership, and the other is the honouring of agreements. The image of the trade union movement leadership—I am not speaking against individual trade union leaders; we have, in all parts of the House, a great many friends who are trade union leaders—has been a bit tarnished lately. It is suffering a little from the situation which exists at the present time. I hope that no one in this House would condone the refusal to arbitrate where arbitration is in an agreement, and I think it would help if we all said so. I think it would help more if the noble Lord, Lord Shepherd, said so than if I said so.
LORD SHEPHERD: My Lords, if the noble Lord will do me the grace of reading my speech, he will see that I made a special point here. But I stressed not only the integrity and the impartiality of that arbitration but that it is seen to be done with integrity and impartiality.
LORD THORNEYCROFT: My Lords, that is a perfectly fair reply, but where there is a provision for arbitration, do not let it ever be said that in this country there is not the capacity for Englishmen to arbitrate fairly. There is no problem in this country about finding arbitrators who are capable of independent judgment. We have them. But where these things are written into an agreement, then let us all say, from all parts of the House,

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that they should be honoured. This has nothing to do with legislation. I believe that these things should be honoured if they are in an agreement come to between two sides in industry. I hope, equally, that no one would condone a strike for political purposes. I say this because on Monday last we saw a vast disruption of industry in this country, caused by a union which was opposed, as it was perfectly entitled to be, to a Bill which the Government had introduced, which was largely debated in the General Election and which had nothing to do with any dispute between the two sides of industry in any firm that was involved. I should have thought that that again was something which on all sides we ought to say was wrong. It would help if the noble Lord, Lord Shepherd, speaking with all his authority from the other side of the House, would say so, either now or when he winds up the debate.
LORD SHEPHERD: My Lords, I should have thought that the views of Mr. Vic Feather and the Trades Union Congress were quite sufficient to answer the noble Lord's point.
LORD THORNEYCROFT: My Lords, I am glad to hear that the noble Lord condemns it. The other thing we all understand, though we would not condone it, is that when a trade union leader is faced with a situation in which there is mass support for an unofficial strike, he is in very considerable difficulty. Is he to watch the militants take over and lose all semblance of authority over the union? Or has he, as the noble Lord, Lord George-Brown, suggested, to climb in behind the strike? This is one of the most dangerous and difficult problems that faces us to-day, because in many ways strikes can be led not by majorities but by minorities, and they can be followed by trade union leaders who ought instead to be leading the union. I do not dismiss the difficulties of a trade union leader to-day, but I put my finger on that as one of the biggest problems.
Why do people support such strikes? I think it is for two reasons. They support them, first, for the innate loyalty which people still have for the union to which they belong. This is still the principal reason why people give mass support. But that loyalty is being strained
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to-day. Doubts are beginning to be widely felt among thousands of people who have been loyal members of unions. Secondly, strikes are sometimes supported by the fear that it will not really pay the workers to have a quarrel with the shop stewards. I am afraid that that kind of support is growing, while the other much better kind of support is tending rather to diminish. There are some aspects of these problems which can be dealt with by legislation—we could debate them for hours—but most of them go beyond legislation. They depend very much on the standard of trade union leadership.
What is the situation which confronts the industrialist now? His view is not a very happy one. He sees a wage-led cost inflation going on around him. For a whole variety of reasons, he is less ready to put up his prices than many people suppose. He is frightened of his competitors. He does not want to lose his export market. He feels that it is a bit of a defeat if he does not manage to get costs down, and many industrialists are perhaps slower than they should be to put prices up. Salesmen are day by day faced with difficult decisions on fixed price contracts, and they have to weigh a contract against the dangers of inflation—very often without an inflation clause written in. In minuscule, the RB211 case is being repeated throughout British industry at the present time.
All these problems are confronting industry and, squeezed between the increasing costs at the one end and the competition at the other, firms are running short of funds to make the necessary investments. They are starting from a position where the output per man is already lower than in a great number of competing countries overseas. The stark facts are that industry after industry has a choice between raising its prices, reducing its manpower or cutting its investment, and many firms are doing all three without an option to do anything else. As a result, the term "inflation" has for thousands become not merely a headline in a paper, but a redundancy notice. That is the case all over the country, and it is not pleasant. Under this pressure of wage inflation, the problem is not met simply by not hiring more people, but by giving redundancy notices to men whose families have been concerned with a firm

1421
for many years, sometimes for generations. It is therefore a very grave situation which confronts us.
There is no complete, easy and safe answer to these questions. What we have to do is to secure that all of our policies work in the same direction. I agree with the noble Lord, Lord Robbins, about monetary policy. No one could contemplate the use of monetary policy on the scale that would be required to deny all the inflationary funds at the present time. We could not do it. It would be like trying to slam on the brakes of a railway engine travelling at 60 m.p.h. It would be a disaster. But we have to see that the monetary policy, that the fiscal policy, that all the policies we use work in the same direction. We have to emphasise with all the clarity at our command that agreements which have been entered into should be honoured—and that includes agreements to arbitrate.
We have to condemn actions such as those of Mr. Scanlon, which add to an already difficult situation, with the strike about a debate which ought to take place in Parliament. People should not be marching up and down and staying away from work, because this country cannot afford it. We have to hope, in the interests of trade unionists above everybody else, that the Government's policy of de-escalation will work. If it does not work or does not work in time, then we shall have to adopt some form of wage policy—perhaps temporary, perhaps clumsy—which, in effect, will virtually freeze wages for a period until we have the situation on sufficiently stable lines, in order that we may proceed with safety to the future.
7.9 p.m.
LORD HOY: My Lords, I have listened on many occasions to the noble Lord who has just resumed his scat. For quite a while he was responsible for the Treasury during a period of office in another place, but I do not remember his efforts being crowned with success. I am sure he tried very hard indeed to bring about solutions to the problems that were then confronting the country, but obviously his efforts were not good enough. The speech which he has delivered this evening is rather reminiscent of some of the speeches he made in another place. He always gives the appear-
1422
ance of wanting to be extremely fair to all sides, but he then devotes at least half his speech to an attack on the trade union movement, as if all the difficulties of the present situation were the responsibility of that movement. Of course nothing could be further from the truth.
Then he said, "We have all got to support the policy of arbitration"; and I would not dissent from that. But how can he make that claim without adding that the cause of arbitration is not reinforced by a speech from the present Prime Minister attacking the arbiter? Indeed, if the Wilberforce Inquiry have done nothing else they have helped to restore our confidence in the impartiality of tribunals. But when we had the Scamp Report the present Prime Minister went out of his way to attack Sir Jack Scamp. Having behaved in that way, he cannot complain if there are certain trade unionists who have begun to question the impartiality of these arbitrations. I say that as one who supports arbitration and, indeed, as one who would insist that anybody who has come to an agreement ought to maintain it. In the working out of these agreements we sometimes find that we have made a mistake, but it does not matter whether a mistake has been made or not: in my view, if we have put our signature to an agreement, we ought to keep it. So I hope we have made our position perfectly clear in this respect, and I can only hope that others will follow the same line.
My Lords, one of the reasons why I wanted to say something to-day was this. Like the right reverend Prelate the Bishop of Durham, we in Scotland have come through some very difficult times—perhaps very like Durham, certainly like Northern Ireland, and certainly like parts of Wales. To-day, we in Scotland have some 118,000 people unemployed. And it is the recollection of what happened in days gone by that frightens a considerable number of people in the country to-day. I agree with my noble friend Lord George-Brown that one of the disappointing things in to-day's debate was the speech of the noble Earl, Lord Jellicoe. He did not take the opportunity, as I thought he might have done, of laying down something positive, something constructive, that the Government intended doing to meet the present unemployment situation. He refused to do so;

1423
indeed, he went on to blame the trade unions again for all the things that are responsible for to-day's inflation.
The noble Earl carefully ignored the steps taken by the Government, who have some responsibility for the present-day inflation. Indeed, this was taken up by the noble Lord, Lord Robbins, who said that one of the things that aggravates the present position is for the nation to see cuts in the tax on the personal income of certain members of the community at the expense of other sections of the community. And let us remember that when the Government introduced their mini-Budget, when the Chancellor rushed to give 6d. off the income tax, he announced at the same time that the rest of the community, who were not going to enjoy these benefits, would be faced with increased prices. Those increases were caused not by the trade unions but by the action of the Government, who increased the price of nearly every school meal in this country, brought about increases in dental charges, in health charges and so on. All these things happened as a result of Government action.
We have also been told by the Government that they propose to change the whole system of agricultural support in this country. I raised this matter in your Lordships' House some time ago. The Government say that they will deduct at least £150 million from these subsidies. Noble Lords are bound to understand that if they deduct this amount from subsidies then somebody has got to make it up at some other point, and the cost will have to be met by the consumer. If, on top of that, import levies are to be imposed, then obviously the cost of living is going to go up. We would be foolish to think that these increases can go on without people, especially the lower-paid, applying for increases in wages to meet that situation. Therefore, if blame has to be apportioned, let us remember what the Government were responsible for, and not seek to fasten it 100 per cent. on the trade union movement. Perhaps both are at fault.
The noble Earl disappointed me a little today. I thought he would say that the Government were going to take
1424
some steps to meet the present situation, and indeed what their industrial and economic policy was going to be, because even if one reads The Times of to-day one sees that they talk about the lack of industrial investment. Indeed, as I understand it from to-day's issue of The Times the C.B.I. have arranged a conference with the Prime Minister on Monday to discuss this very problem. The Times says:
"Mr. Adamson said last night: 'We are very seriously concerned at the prospect of a recession. If Government moves are not made to stimulate investment—while continuing to attempt to keep down inflation—there is a very real danger of serious recession'".
I think noble Lords will agree that this is in fact the situation which confronts us. If it is, then the Government cannot escape taking action. Indeed, it gets rid of the argument which my noble friend Lord George-Brown drew to We attention of your Lordships earlier: that no longer can there be this nonsense spoken about no Government interference. Considerable chunks of industry in this country simply cannot live or find the money for investment unless it has the assistance of Government. So that old canard goes by the board, and if Lord Robbins's one in his old Socialist days has gone, then this one from the capitalist side has gone with it.
One industry which I have always regarded as a barometer of trade in this country is in fact the machine tool industry. I served for very many years in another place on the Public Accounts Committee, and when we were going into the subject of investment this was one of the industries that we always took into account. If there is no investment in machine tools, or a lack of investment, it means—and I am willing to give way if anyone will dispute it—that obviously we are not preparing for the days that lie ahead. Unless we can keep our industry up to date, properly equipped and planning for the future, it simply will not go on in an economic way. I was struck by this to-day because in the Guardian of February 18 there was a very long article dealing with this particular industry; and, indeed, the previous Government set up a specialist committee under Sir Richard Way to inquire into it.

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The reports from the industry as contained in the Guardian are pretty alarming. The Business Guardian of February 18 contained two reports, one from the industry and one from the specialist committee presided over by Sir Richard Way, and both, I am bound to tell your Lordships, made depressing reading. The industry's own report said that the machine tool trade in this country was the worst for four years; that home orders fell 42 per cent. in the last quarter of 1970; and that export orders in the same quarter had fallen by 21 per cent. The report continued:
"The severe downturn is still continuing and manufacturers are worried that a combination of the ending of investment grants "—
which I shall return to in a minute—
"and Rolls-Royce machine tools being offloaded on a depressed market will make things even worse".
One of the changes that the Government made was in regard to investment grants, and whether that was right or wrong was for the Government to decide. I think that it was wrong, and so does industry, apparently, because they need these investment grants if they are to undertake their work. The Sir Richard Way Committee which was set up by the Government issued a Report which brings out the facts of the case. This Committee recommended that, with the means at their disposal, including their powers under the Industrial Expansion Act, the Government should encourage development and research and finance through the Industrial Reorganisation Corporation. But the Government have got rid of both the Act and the Industrial Reorganisation Corporation. These are the two factors to which the Way Committee referred as being a way out of the difficulty.
I would repeat what was said earlier: that the Government should reconsider their policy with regard to investment grants and certainly with regard to the I.R.C. If they are determined to abolish the I.R.C., then let them tell the House to-night what will be put in its place. Not only Members of this House but industry, too, will be grateful for the information; and no one looks forward to getting it more than the industrial developers in Scotland. There are certain other things that I should have liked to say, but in view of the lateness of the hour I shall cut my remarks.
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When the Minister says that we all have to pull together, then I say that in truth the Government have to be seen to take part in this pulling together. It does not encourage the workers of this country to see the Government, in these extremely difficult circumstances, finding time to sell off Thos. Cook & Son, to hive off the profitable sections of the coal industry and to get rid of many things that are bringing income to the Government. You cannot do this and then say to the workers, "You must give of your best because although we are acting in a doctrinaire fashion we do not want you to do the same."
I believe that the country is in a very serious position. I should like to do all I can to help. Like the noble Lords who preceded me. I wish that I could find a solution. I should not care from whence it came. The situation is such that I wholeheartedly support the opinion expressed in the leading article of yesterday's Daily Mirror.
"You cannot have a continuing process in this country with the trade unions facing up to the Government all the time. They have got to find a solution to the problem. Nor can you have a situation in which employee is fighting employer all the time."
The noble Earl, Lord Jellicoe, said to-day that he saw a door that might be a little open. I say that it is the responsibility of Government, even if they are rebuffed, to take a risk and call the various parties together. I think that time is running out, and running out quickly. I hope that the Government will take the lead in consulting with all sides of industry to see whether they cannot hammer out the policy which the noble Earl spoke of and which we should like to see in action in this country.
7.25 p.m.
LORD O'NEILL OF THE MAINE: My Lords, it is perhaps appropriate that I should follow the noble Lord, Lord Hoy, from Scotland, because the part of the world from which he comes has many of the same problems as the part from which I come. Perhaps I am not using the correct Parliamentary expression when say that "my noble friend" Lord GeorgeBrown—for he is a friend—was kind enough to drag me into his speech. But he went on (for with the noble Lord there is always a sting in the tail) to imply that Northern Ireland was much happier with the policies of his Government and Party

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than they are with the policies of the present Government. But I am already covered on that front (perhaps the noble Lord, Lord George-Brown, was not in the House at the time) because when the noble Earl, Lord Jellicoe, made a general statement about these matters three or four months ago I raised with him the very question as to whether or not this policy of abolishing industrial grants and replacing them with investment allowances would in fact suit us. His reply, and I remember it well, was very valid: that if we could get the economy of the country as a whole right then the regions along with the rest of the country would benefit. That is where this debate comes in and becomes so pertinent.
My Lords, the most frightening sentence in the Wilberforce Report is a quotation on page 33 from a Treasury memorandum:
"The rate of increase in wage and salary earnings has been the fastest since the short-lived boom immediately after the First World War."
It will be readily agreed, at least I think on this side of the House, that over a year ago this fastest rate of increase got under way. We have been told by the former Government that after a period of restraint it was inevitable that the lid would blow off the kettle but that nevertheless their former policies were correct. Others may have drawn a different conclusion and would have said that these things cannot be controlled by reference to some committee or board; that wage restraint will result only from a series of tough negotiations and, if necessary, lengthy strikes. My own view is that it is too early yet to say that this is right. We must all pray and hope that, somehow, this "fastest rate of increase" can be reversed. If it is not, we shall sink further and further from the proud position we in this country once held in the world and presumably risk facing yet another devaluation.
I should like to pose this question to the Government. If, despite all their strenuous efforts to control the rate of inflation which they found gathering speed when they took office, they find that they do not prove entirely successful in their quest, will they then give careful consideration to the possibility of putting
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something in the place of the Prices and Incomes Board? May I say at this point to the Government that I am not speaking in a vacuum? I have heard these remarks made in the boardrooms. I have heard of management adopting attitudes of this kind, and I think that the Government should appreciate this. It is not only from the other side of the House that suggestions of this kind are coming.
Although we are a Western country and like to pretend that no one needs to have his face saved we do, in fact, have strong similarities with the East in this respect. A board of some kind can be a buffer, a place for problems. To take an extreme example, it would be easy to argue that the United Nations should be abolished because it has failed in its quest to abolish war. But I believe that the world would be in a worse situation to-day if the United Nations did not exist.
There is perhaps a tendency on the part of new Governments to over-react against the powers pursued by their predecessors at the time of their assumption of office. If I may digress for a very short time, my Lords, in this respect I personally regret the abolition of the Conservative-created Consumers' Council. At the least it was very inexpensive. I had lunch with the noble Lord, Lord Donaldson of Kingsbridge, about six months ago in his office. I remember balancing a small carton of cold coffee in one hand and a bit of cold pizza in the other. If I had spilt any of the coffee it would have fallen on to bare boards. The Council was not an expensive organisation, and it cannot really have done all that amount of harm.
My Lords, I praise the Government for courting unpopularity by trying to bring some kind of order into our economic affairs. But I hope they will not rule out the necessity for creating some new organisation, some form of control, if they find that by the summer we are still faced with (I say it again for the fourth time) the fastest rate of wage increase since the First World War.
7.32 p.m.
LORD GRANVILLE OF EYE: My Lords, like the noble Lord, Lord O'Neill of the Maine, I have listened to most of

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the speeches made during this very interesting debate. I think the tone was set by the constructive and well-reasoned speech of my noble friend Lord Shepherd; and that was followed by the very moderate and reasonable speech of the Leader of the House. The Government have had many warnings from noble Lords who have spoken, including my noble friend Lord George-Brown, who gave a description of what is happening at present to many middle-sized businesses throughout the country. These businessmen are finding it extremely difficult to borrow money at 8 per cent., 9 per cent., or even 10 per cent., and their plight is getting desperate.
At this late hour, I wish to refer to only one aspect. However we interpret the excellent Wilberforce Report, this debate has without any question been about inflation. As nearly all speakers have indicated, most countries have inflation. It has been controlled by the various Governments by all kinds of policies, but no one has yet found a cure for it. The point I wish to raise is one which was mentioned by the noble Lord, Lord Robbins, at the end of his speech. I wonder how much we know about inflation, its causes and its cure. I think that the housewife understands about it when she goes into the shops to buy goods. I think the pensioners, and those people on fixed incomes, certainly understand about it. But I wonder whether those who march behind the banners and take part in demands for increases in wages understand it. I wonder whether the man in the street really understands what the Government are talking about when they refer to inflation.
We are told about it by the Press; we hear about it on "The News at One"; and in the programmes "Twenty-Four Hours" and "World in Action" on television. We get it from debates in both Houses of Parliament, and we are told of it by political commentators. But I seriously wonder whether there is not a breakdown in communication regarding the vital problem of trying to make people understand what inflation is all about. I wonder whether members of the Government, in their speeches at weekends, and interviews on television (the Secretary of State for Trade and Industry appeared last night) can get over to the man in the street that an increase
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in his pay may be an increase in paper money, but not necessarily an increase in purchasing power; that almost automatically rises are followed by price increases. Does the worker on the shop floor think that when economists like the noble Lord, Lord Robbins, and others, refer to this matter from time to time they are crying "Wolf!"?
LORD WYNNE-JONES: My Lords, will my noble friend allow me to interrupt him to put a question to him on this point? Like other noble Lords, he and I remember clearly the period after the First World War when, far from there being inflation, there was a long period of continuous deflation. Never had there been such misery. I think I am right in saying that since the last war there has been continuous inflation. At what stage, at what point, does inflation become wrong; and at what point is it right?
LORD GRANVILLE OF EYE: My Lords, my noble friend has certainly posed a problem. All of us who can remember the 1931 world crisis, the crash on Wall Street and the miserable depression when nobody had any purchasing power or money, remember it a; one of the most difficult of periods. I believe that the Government have to be very careful not to destroy what has over and over again been referred to in this debate as confidence in trade and industry. Once you lose what is meant by that magic word "confidence" you can never cure anything. The point I am trying to make is that I wonder whether the ordinary trade unionist, who may or may not attend meetings of his union branch, really understands what inflation is all about. Does he believe that industry can absorb increases without tears; and go on with increases in pay without putting up prices, but maintaining business and continuing to make profits?
This debate has shown that many observers believe that economically this country is in a very critical position. There are those who believe that the alarm bell is beginning to lose its urgent sound. There are those who feel that already we are in a state of emergency, whatever the Government may think about it. I saw a statement in the Swiss Press yesterday that we are running into a serious economic crisis and that there

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would be a National Government under Mr. Enoch Powell. I do not think that is a "starter".
What I am saying to the Government is that I do not think they are getting the message across to the country. We have no Minister of Information. It is true that the Press and television make their reports and try to get the message over to the public. But it is not just a question of getting over to the man in the street what it is all about. Decimalisation went through smoothly because my noble friend Lord Fiske used the media to explain it, and it was understood. What I am suggesting now is that this is a vital problem, the most important one the Government will have to face in their period of office; and they should be explaining to the man in the street, to the people, in simple terms that they can understand—that is to say, in terms of their income, their pay packet and their purchasing power—what inflation is about.
I suggest to the Government that they should give this idea serious consideration. It is not enough for them to suppose they are going to solve it with a "Think tank", important as that may be. It will need an echelon of information and communication which we have not got at the present time. Without this there is a danger that we shall be living in a doctrinaire communication vacuum. If this goes on, we shall be in for a very tough time.
7.41 p.m.
LORD HANKEY: My Lords, I think this has been a remarkable debate for the way in which it has brought out the great consensus of opinion in this House about the serious situation that we are now facing. We started from the Wilberforce Report, and in that connection I agree with its recommendations. I think that they are definitely likely to be inflationary, but in my view there is no present alternative but to accept them. I do not think that in any circumstances we should go further.
I also agree with most of the Treasury Memorandum (Cmnd. 4579), which I thought was of great interest, especially in the emphasis that it lays on the fatal effects of inflation. I believe that the Government are right in saying that the
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best policy now is to try to get a progressive reduction in the rates of settlement as we go along and reduce them slowly towards the amount by which national production is increasing year by year. We must have some degree of inflation during the period while we are getting back to a state of stability, and the only comfort is that other countries are facing a degree of inflation, too. Their inflation is for the most part not as bad as ours, and unfortunately this goes for our main competitors. The problem of rising prices has been with us for years. I was chairman of O.E.E.C. when the remarkable Report on Rising Prices was produced, the lead in that Report being taken by the noble Lord, Lord Robert-Hall. A great deal of the thinking therein is reflected in the Treasury Memorandum.
It is obviously necessary to have a flexible approach to the link between productivity and wages. I agree with all the things said in the Wilberforce Report on that subject. You obviously have to base any settlement that you make on a national average. But I should like to follow up this rather generalised remark by saying that the conclusion to be drawn from this is that only the Government can calculate the safe norm, because only the Government know what the picture is over the whole country. I do not believe that any individual industry or institute can safely be left to do this: it must be done by the Government. This is the reason why I personally do not like to see the Government standing aside, even to say that they will let "lame ducks" sink.
I think that the norm will have to be agreed with both the T.U.C. and the C.B.I., because the support of both those bodies is essential for the policy to be carried out. It is obvious that we are not going back to a statutory incomes policy (I do not like even using the words "incomes policy" very much) and if it is going to be voluntary, then the C.B.I. and the T.U.C. have to be in on it. Only by a general understanding and cooperation between those two bodies and the Government have we any chance of mastering the situation in the end.
There is, as it happens, an excellent institution in existence—introduced, incidentally, by the previous Conservative Government—in the form of the National

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Economic Development Council. I believe that the time has come when the Government ought to consider quite seriously making a much bigger development of that institution. The trade unions are accustomed to be there, the C.B.I. feels that it is a natural forum, and I believe that the Government would find it an excellent way of encouraging the sort of co-operation that we are going to need.
I would say here that I have been greatly disturbed to see in one of the T.U.C. papers a reference to the possibility of a system of indexing wages. We all understand that as prices rise we shall all want wages and incomes of all sorts to go up. But if you actually index them it has a strong inflationary effect. This system has been tried out by several countries, and it is interesting that both Finland and Denmark have recently abolished their indexing systems because they found it impossible in those circumstances to control inflationary trends. I do not think that we should fail to learn from those examples.
I want to draw attention to Mr. Jim Mortimer's reservation to the Wilberforce Report, because to me this was of great interest and, so far as it goes, I largely agree with it. The Treasury Memorandum, if one reads it carefully, excellent and orthodox as it is, really offers us a long vista of financial rectitude and, I think, a steady continued industrial decline. Unless we get our industry moving again, I see no reason why our economy is ever going to look up.
I personally welcome very much what the noble Earl, Lord Jellicoe, said at the end of his speech in forecasting a new approach to a growth policy. I hope that I have not misquoted him. I think that we need to have something like that quite soon. We have to face the psychological situation in which we find ourselves. Economics is largely psychology. The rules of economics are different in an oriental bazaar from what they are in Bond Street or in Wall Street, because the psychology of the people is slightly different.
It follows that we have to take the psychology of our country as we find it. You cannot always alter it. We have to face the fact that our workpeople expect a rise in their real standard of living every single year: everybody does. Their needs were pent up by the policies
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adopted, with I think great justification, by the Labour Government, and for good or ill we have to face the fact that those policies created a situation in which the lid blew off. We have been going through the consequences of the wage explosion for about two years. There is nothing very new in this. Other people have blown the lid off, too. For instance, I may mention that the Netherlands Government had an incomes policy previous to 1963. In September, 1963—I do not know why the computers which controlled the Dutch economy were not winking little red lights—all of a sudden and to the surprise of everybody, the employers and trade unions got together and said: "To hell with the incomes policy, we are going to blow the lid off." And they raised wages 17 per cent. in about a fortnight. Some of this had to be taken out in inflation; some of it was taken out in hurried increased investment and in other ways, but it was a very embarrassing situation. If you screw the lid on with income policies, the lid is apt later to blow off. This is something we have to face. I said at the time that the incomes policy adopted by the Government was probably good economics, but I thought it was politically dangerous. Possibly that aspect came home to roost in our General Election.
But it is only possible to provide for this rise every year in the standard of living if you also provide for economic growth. I agree with what my noble friend Lord Robbins said: I agree with everything that has been said about the dangers of economic growth. The Conservative Government tried it in 1964 and it damaged the balance of payments. The Labour Government have tried in vain to favour economic growth. Mr. Kristensen, the Secretary-General of the O.E.C.D., once said in a speech in my hearing that the difficulty was that nobody knew exactly what a growth policy was. I agree with that. You have to see what is going to be done about it in each case, and, in particular, you have to remove the impediments to growth. I sympathise with the T.U.C points on growth for the reason I have given. It is also interesting that President Nixon has adopted a growth policy and regards it as the only solution for the American dilemma, which is not altogether dissimilar to ours, for

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it is one of inflation with considerable unemployment.
Coming to economic growth, I should like to "rush in where angels fear to tread" and say a few words on this delicate subject. It has usually been left to officials and economists. If you say to the economists, "How are you going to encourage growth?" they often come around to the idea that you allow an increase in demand in various ways. An increase in demand usually has the effect of increasing imports, particularly in this country. One extraordinary contrast between the German economy and our own is that although the Germans have periodical economic changes, as we do, whenever their economy starts to expand it is always exports that lead and not imports. Why is this? It would be worth a major study. We tried to make a study of it in 1964. We had various papers on the subject, but none of them succeeded in showing us what we should do in order to secure the same psychological conditions in the United Kingdom economy as in the German economy. I have a hunch that another study into Germany, and possibly Japan, would be very well worth making.
If, on the other hand, you leave growth to officials, they will usually propose various investment grants and allowances and otherwise they will mostly rely on putting up various barriers to someone doing something else. The flock of sheep has to be driven in the direction of the pile of mangleworzels, but in the end there are so many stakes and hits of fence between the sheep and the mangleworzels that they cannot find the way to get there. I do not believe that that is much good. As for the controversy about investment allowances and investment grants, it is fair to say that neither has had any great effect. I will come back to investment in a moment.
A policy for growth has, I believe, to be treated on an altogether wider front. Let us go back and see what the problem consists of. Industrial growth depends, first of all, on innovation. We have to be in the forefront of sophistication in this country. It is probably not going to be much good to rely forever on producing the ordinary motor car. We shall probably have to face the fact that other countries, like Japan, are going to flood
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the markets with the ordinary type of motor car. We ought to be thinking of producing very sophisticated cars in masses for the world population. This depends on scientific and technological innovation. The scientists and technologists ought to be encouraged to have more to do with industry. We have, in my opinion, too much concentration on fundamental science and not enough links between science and industry. We ought to bring in the universities and the great scientific resources of this country. This is something that requires a national effort. A good deal of this has been said before, and I say it again without hesitation.
Then we come to the willingness to apply innovations on the shop floor. This is a very difficult point in our country. It is an extraordinary anomaly, but the more you look to the left politically the more irretrievably conservationist (I do not say conservative) and opposed to change everybody seems to be, when any change has to be made in their working arrangements. The T.U.C. and the trade unions have somehow to be brought into full co-operation over this matter. I do not think they can cooperate until they have been greatly strengthened by the Industrial Relations Bill. I am confident that that will be the effect of it. I look forward to a time when they will be willing to use their greater influence in the interests of opposing stick-in-the-muds on the shop floor, because it is the stick-in-the-muds that we suffer from.
LORD WYNNE-JONES: My Lords, in many ways the noble Lord is referring to a capitalist society and not a socialist society, when he talks about the workers being conservationists.
LORD HANKEY: My Lords, I am referring to the society that we have now. I do not really know which it is. In many ways I think there is more socialism in Great Britain than there is in Russia, for instance. I have been pretty condemnatory about the work-people but in some ways the board rooms are not very much better. With industrial relations as they are, it is almost impossible for management to manage. Until we have set them up with proper control over their own affairs I do not see very much hope. The result of what

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we have now is shown in the incredibly poor figures of investment.
The United Kingdom, of all the 21 nations in O.E.C.D., comes eighteenth in the percentage of gross national product which is devoted to fixed asset formation. If you take the amount of money per head which is invested, the United Kingdom is still thirteenth. This is a derisory position for us to occupy among the industrial nations of the world. We absolutely must improve this figure. I believe you cannot improve investment until you have improved industrial relation. And you cannot improve investment, either, until you have changed taxation policy.
I should like to say a word on taxation policy. All the emphasis in our taxation is on taxing profits and enterprise. The system is hopelessly complicated and really very out of date. When I was coming into the House to-night my watchful eye was attracted by an extremely smart lady in a trouser suit walking along the pavement in front of me. Then, when I looked again, I was astonished to see that every corner of her trousers was covered with patches of different sizes and colours. That is what our taxation system is like: it is all covered over with patches and nobody can make sense of it.
I believe that we should be reshaping our taxation system to encourage risk-taking investment; and, although the Treasury Memorandum expresses fears about the effect on our balance of payments, I personally think that imports for the purpose of increased industrial investment are good and that we have to face that necessity. And if our balance of payments is good, that should encourage us to do so. Perhaps the same does not apply to imports for the sake of consumption: it may be that a distinction ought to be drawn there.
So perhaps we ought over a period to switch the emphasis in our taxation system to taxes on consumption. In this connection I think somewhat pensively of the value-added tax, used on the Continent, with a refund for exports. As used in Germany it is rather complicated, and I should hope that we could find a simpler system. But we shall in any event have to do this when we join the Common Market. So we might examine the possibility of making a virtue of
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necessity, and see whether we cannot do a little more to change the emphasis of our taxation system.
I realise the difficulties of this. When taxes are put on goods, and the goods are made more expensive, the cost inflation is fed; because by putting up the cost of goods an argument is provided for all people who want to raise their wages. So this can be done only slowly and over the years. But I believe that this is something which ought to be considered. We must in any case henceforth bear in mind that if we try to reduce demand by raising prices the effect will be to feed the cost inflation, as it has done in the past.
There is another field which, at the cost of making this debate even more discursive, I ought to mention. I believe that the time has come to tighten tip our administration quite considerably. There is an enormous amount of laxness—such as, for instance, doctors over-prescribing drugs. We ought to distribute help only where it is needed.
Take, for example, redundancy payments. I always thought that redundancy payments were to be used to encourage people who were thrown out of work to be retrained for another job. The Americans say that 40 per cent. of the jobs which will be in existence by 1980 are not in existence now. The whole population is going to have to be retrained. The Foreign Service, for instance, recognises the need to retrain people between the ages of 35 and 40. But if we make redundancy payments there is a tendency (I hope that I am not being indiscreet or offensive; I am not meaning to be either) for many people to take a prolonged holiday with the money. It ought to be used for retraining, and I suggest that there ought to be some link between the redundancy payment and the retraining. The whole system of that, and of unemployment insurance, which is an invaluable protection against changes in the economy and a buffer against sudden depressions, ought to be looked at again with this point in mind.
To give another example (this is not a Governmental one at all) take motor car insurance, which is very much up our street to-day. It is common knowledge that if a man goes to a garage and says he wants his car repaired, and lets out the fact that it is on insurance, the price

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is immediately doubled. Because of this abuse, of course, you and I have to pay a great deal for our motor-car insurance. More ought to be done about it. I do not know that the Government can do anything, but the insurance companies ought to be more severe than they are, although they already press the garages quite hard.
Your Lordships should not think that I am talking only about training the people on the shop floor; I am extremely keen on management training. Until a week or two ago I was Vice-President of the European Institute of Business Administration of Fontainebleau, where we run a course, in English, French and German, for businessmen to learn the very latest techniques which will be applied throughout the Atlantic area. We have a number of brilliant young English people there every year who often take some of the top prizes. This is an excellent idea. We ought to have much more management training in our own business schools.
I like to think that there will be a great deal more training for middle and top management. At the present moment we have in this country a great deal of business training for people coming out of universities or for those who have had a little business experience. There should be much more for management between the ages of 35 and 40. If the Government want to have growth—and they ought to want to have growth—they should try to press forward with this training and see what more can be done, because I am not quite clear that these facilities are adequately used at the present time.
There should be much more trade union training. It is very difficult for small trade unions to train shop stewards and branch secretaries, but it is absolutely vital. It is done in a very big way in Sweden. If only we could have fewer but bigger trade unions, they would all be able to do it in the way in which some of our great trade unions do it now. This is one absolutely vital point, because there are extremely competent and ardent trade unionists on the shop floor who do not know very much about economics; and when the T.U.C. or somebody else tells them that they must be careful not to precipitate inflation,
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they do not really know what it is about. It is important that they should know. Industrial relations should be more extensively studied by management, too. We are greatly in arrears on this. One thing the Government might do is to bring universities into greater co-operation, both for trade union training and for management training. I am sure we are not using our present training and education facilities in the way most desirable if we are to have a growth policy.
Obviously, we ought to try to foresee manpower needs. It is no good going into a policy of growth which suddenly requires many more engineers if the production of more engineers depends on inflationary rises of pay taking place first. Somebody must try to foresee this situation. All these matters, I believe, are the kind of matters which "Neddy" could usefully be asked to think about. In all this I do not think that the Government can stand aside. The Government ought to be adopting a growth policy, and as your Lordships will see this is not just economics; it covers education and science; it covers all the matters I mentioned at the beginning of my speech. And it has to be done with considerable ardour and energy.
My Lords, to conclude, the cost/inflation situation can probably be cured only in the way the Government propose, but I foresee that it will probably be necessary eventually to adopt a national norm of some kind for wage increases, with the co-operation of the C.B.I. and the T.U.C., and so far as possible it should be based on actually achieved productivity increases. We should not, as we have been doing, count our chickens before they are hatched. If we were to do this it would encourage everybody on the shop floor and in the boards of management to press productivity forward. It is necessary to revitalise the National Economic Development Council and to try to foresee the needs across a really wide front covering economic and financial needs, industry, trade, manpower, education and science. The Government have to face the need for coming into this. I just do not think that they can stand aside. We must be seen to be moving forward. We have to reshape our taxation system to fit the new circumstances. I believe that joining Europe will certainly help, but if we do not work and pay our way we shall in

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any case become a slum in twenty years—and when I say a slum, I mean a slum. We are at present going downhill by comparison with everybody else. If that happens, my Lords, not only Britain but our Parliamentary and democratic system may come to be at risk. If we cannot do better than we have done, our future may be greatly prejudiced.
8.10 p.m.
LORD SELSDON: My Lords, if one listens to all the arguments put forward by economists, industrialists, trade unionists, institutions, foreign powers, the media and Government—to mention just a few—one can easily become confused and lose sight of the real objective. This real objective—and I hope your Lordships will forgive a naïve oversimplification of an enormous, far-reaching problem—is simply to find the most appropriate way to make this country more Prosperous in the shortest possible time. I look to the Government for management. I do not believe in a policy of "try it and see"; I believe in doing it and making it work.
Having said that by way of introduction, I should like to thank the noble Lord, Lord Shepherd, for putting forward this Motion to-day and to say how much I welcome the way in which attention has been focused on the Wilberforce Report, because I feel that it has been left in the background for some time. I have a very high regard for this Report. It raises many points which are applicable to all sectors of private and public institutions and it goes back to the roots of many of the problems which we are facing to-day. To me, like my noble friend Lord Jellicoe and my noble friend Lord Brooke, the most significant paragraph is paragraph 10.5 on page 32—the paragraph which speaks about a "dangerous condition of spiralling inflation". I will not quote it again, but the words it uses are damning words which to me conjure up a vision of apathy and discontent, poverty and hopelessness, things that I have only read about because I was too young to experience them myself. These melancholia are not synonymous with this great country of ours. I do not think one should ask, "Where did we go wrong?" but rather, "How can we put things right?" I do not believe that we have sunk into the abyss of despair, but I do believe that we are facing an extremely crucial and
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explosive situation which only positive and extreme action can resolve. In a very short space of time we must achieve renewed confidence, revitalisation and proper exploitation of the very considerable talent that we have in this country.
My Lords, there are many solutions or combinations of solutions which can be put forward but I believe, without wishing to be extreme, that there are only two which could have any hope of success and each of them is at the opposite end of the spectrum. I believe that we have floundered around in the quagmire of economic argument for so long that only fairly dramatic action—I do not say that that is necessarily the solution, my Lords, but it is a first step—can restore the confidence of the people and of industry, and it is upon this need for confidence that I place great emphasis.
On the one hand we can seek success through restriction and control—in short, a prices and incomes policy. While this has its merits—and I cannot present those merits with the same skill and expertise as noble Lords opposite—I do not feel that it is a long-term solution. For a prices and incomes policy to bite effectively at this time would, I believe, require rigid restriction and control in the extreme. It would, I suggest, create enormous discontent and receive little support from industry. It could be totally counter-productive and although applying a brake to inflation I think it would increase stagnation and perhaps destroy incentive and confidence.
Thus, my Lords, I personally dismiss it and move to the other alternative which, as opposed to restriction and control, calls for freedom and leadership. By "freedom", I mean the minimum of Government interference (in view of a remark by the noble Lord, Lord Hoy, I use this word lightly) and, equally important, the minimum of trade union interference in industry—and again I use the word "interference" lightly. By "leadership" I mean the creation of the right environment and the provision of the right incentives which will encourage increased productivity, increased capital investment and the creation of new jobs and opportunities.
My Lords, I do not think there can be any sitting on the fence, and once a course is firmly set, as I believe and

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hope it is going to be, there can be no going back. For the impact of any positive policy to have any chance of success there will be problems which will need attention and careful handling, and some of these I will come to in a moment. However, I believe it is essential to place the responsibility for success firmly at the feet of industry and to give it the freedom and encouragement it needs to generate renewed confidence throughout the country.
The different industries in this country, in both the public and the private sectors, are becoming more and more interrelated and dependent upon each other as bigger and bigger units are formed. Poor performance by one sector, whether it be due to bad management, industrial disputes or lack of productivity—it does not matter what the reasons are—we know can often have near disastrous effects on other sectors. Short-term support for weakling industries (although I do not propose to go into the argument about this subject now), whether State owned or private, can only postpone and not avert crises unless the basic causes for poor performance are rooted out and resolved.
Here I should like to return to the electricity supply industry, which was the subject of the Wilberforce Report, and to say that I have a very high opinion of this industry. I think, as the Wilberforce Report bears out, it has performed well, it has been a good employer and until recently it has had an excellent industrial relations record. But, my Lords, the industry would have performed even better if it had not suffered from Government interference and had not been tied by Government to another public sector whose performance has been so poor. Here I refer to a point made by the unions, mentioned under Section 7 of the Report, "The profitability of the industry"—the cost of using uneconomic fuels.
The performance of the electricity supply industry is dependent mainly on the cost of the fuel it uses. Some years ago the Generating Boards wished to change from coal to oil. This they felt would be more efficient and more economic—all the more so since good, long-term contracts could have been negotiated with the oil people. But the
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last Administration said "No", because I understand they feared unemployment in the coal industry. I respect that view. They therefore agreed to pay the extra cost of running stations on coal. This I believe was a mistake, and it turned out to be a disastrous mistake. The coal industy could not deliver, I understand mainly because of absenteeism problems and poor productivity, and the price of coal went up. The electricity industry was at last allowed to switch in part to oil, but too late to get the advantageous long-term contracts.
Despite the fact that the basic ingredient—fuel—has risen in price, and coal, in particular, having gone up by 30 per cent. in the last two years, the productivity of the electricity supply industry has been excellent. Since 1965 the number of units sold has increased by 29 per cent. and the number of consumers by 8 per cent. During the same period the number of staff has been reduced by some 15 per cent., from approximately 220,000 to 190,000.
It is naturally right and proper for Government, like good management, to lay down requirements for their industries in the public sector and to set objectives, bearing in mind numerous factors relating to other industries in both the private and the public sectors. But I believe that, these objectives having been set, the minimum interference is desirable if they are to have any chance of success and eliminate any possibility of "buck-passing". In this connection I urge the present Government not to make this mistake. The electricity supply industry is required by Government to earn a net return of 7 per cent. for the current quinquennium. But with the price of coal having gone up, with oil also going up, and with further increases on the way, the industry must either be allowed to put up its prices or to have its earnings requirements and objectives reduced.
My Lords, I move to the other subject, and again I use the word lightly—the interference by the unions. The subject of industrial relations will, I know, be given a full airing in your Lordships' House in due course, and I will touch on only some aspects of it to-day. In many instances I respect most sincerely the desires and motives of the trade unions, and many of the principles for

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which they stand. They seek better conditions and increased prosperity for their members, as every employer should for his employees and his shareholders. But, my Lords, they have so mismanaged their affairs that, whether by accident or by design, a situation has been created where, instead of us all working together, an attempt has been made to suck the life-blood out of this country and to destroy the confidence which I personally have in it. I do not believe that this is the intention of anyone, and I put it down to short-sightedness and narrow-mindedness. Union interference—and again I stress that I use the word lightly—throughout industry has done more to destroy confidence and kill pride and enthusiasm than almost any Government action could have done. I find it sad that in advocating any policy I must add the rider that it will succeed only if we can get full co-operation and if people can be diverted from their almost self-destruction.
The current industrial relations problems have, I think—and here I speak with some experience—destroyed the confidence not only of our own but of foreign industries, whom I have been trying to encourage in the last few years to invest in this country. There has been a "wait and see" attitude. They do not have confidence. One finds this when one talks about the North-East, when one talks about the brilliant British labour force, and it is difficult to know why when one is trying to sell a concept in which one personally believes. We have to face it, and I think it has happened, though some of us do not recognise it. And here is another word that can cause it-will and misunderstanding. We have a confrontation between unions and the elected Government, and I think the elected Government must and will win; but here again the word "win" is upsetting, for it conjures up the idea that someone has lost, when we want all to work together. We are all on the same side, and I, for one, as a young member of your Lordships' House, find it hard to understand why people will not say this more often.
I move to what I consider is a very distressing area, the question of unemployment. I do not think there can be any turn-round in the present mood. I personally see unemployment of well over
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a million. We have to accept that strikes have killed and are killing productivity and creating redundancy. Secondly, industry is, rightly or wrongly, fed up to the teeth with industrial relations, and, losing confidence in the larger labour forces, is often seeking fewer employees of higher calibre and higher remuneration who can generate greater productivity than a larger, lower-paid labour force. I do not necessarily say that it is true that they can, but I think this is the mood, and it is the feeling in the electricity supply industry. Thirdly, the policy I am advocating, particularly that of allowing industry to stand on its own feet, will in the short term cause many companies to go to the wall and create greater redundancy and bankruptcy. But, my Lords, if at the same time the right climate can be created and the right incentive provided, we shall get confidence back very rapidly. Good industries will begin to make the capital investment necessary to bring about expansion and provide more jobs, and they will also attract risk capital and foreign investment. The upward climb will begin, slowly, but then more rapidly.
What must concern us, and it concerns me very much, is the short-term effect of any extreme policy and how to cushion it, with unemployment at well over one million. I attach great importance—and I know this from when I was myself a salesman in the North-East—to the need to prevent apathy from taking hold, to ensure some form of occupation for the unemployed which will allay the depression and boredom surrounding unemployment. I have heard people talk about things which happened in the 'thirties. We must not destroy the pride of our people; we must enable them somehow to have some occupation or something that will dispel their apathy.
Whether this responsibility should be placed at the door of national Government or local authority I do not know, but I believe that within the regions there could be utilisation of some of the manpower available for perhaps a valuable social, rather than an economic, benefit. For example, one might encourage the formation of anti-pollution groups to clean up the countryside, landscape slag heaps and so on. But here I am referring to the medium and long term unemployed. After a few weeks

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of full unemployment benefit people might be given the option of going on to a lower rate whilst remaining economically inactive, or given the option, while drawing the full rate or maybe even a little more, of contributing to improvement in the environment. It is my belief that those members of the community who are unemployed through no fault of their own would gain from such work in terms of personal satisfaction and self-respect and a feeling that they were making some worthwhile contribution to society. Take shipbuilding, for example, I believe, and shipbuilders I have spoken to believe, we make the finest ships in the world. But they must be allowed to keep up their pride for the future. I do not want to see a continually higher level of unemployment, but I believe it is inevitable in the short term. It is in an area of this sort that there is a dangerous situation which could cause more harm and disaster over a long period of time.
But, vital though industrial relations are to the future of the economy, they must go hand in hand with some change in fiscal policy which will do much to encourage and support industry. Economic arguments could go on continually for and against every method of direct and indirect taxation, and while I do not wish to throw all of them out of the window, I believe that those policies which will have the greatest success are the ones which will provide the greatest incentive and generate the greatest confidence. Whether economically they are right or not, I believe strongly in this feeling of increased confidence throughout.
Finally, I try to find a key, and one thinks about it. But there just is not one, and I put it down to the need for confidence, confidence in Government, which will lead to confidence in industry, confidence between employer and employee alike, and international confidence which will give us greater bargaining power at the conference tables and encourage foreign investment in this country. This successful regeneration of confidence will, I think, depend upon two main issues: industrial relations and fiscal policy. I believe that the argument of power to provide long-term incentives and confidence must take priority over any
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economic argument relating to the dangers of lifting direct or indirect taxation one way or the other.
I end on a very simple note, the need for optimism and the dangers of pessimism. Optimism can create confidence. It may be a "con trick", we all know, but optimism can create confidence and pessimism can destroy it. I felt rather depressed to-day, although I respect the power of oratory in your Lordships' House. I hope that I have many years to live in this country, and I felt slightly pessimistic with the views that were held. I hope that in a few years' time I shall not be on the scrap heap; maybe I shall have to go and look for retraining. But I am an optimist, and I believe firmly in the ability of the people of this country. I believe that this ability can be properly harnessed to generate prosperity. I believe that the policy of the Government is beginning to work, and I hope that they will stick to it and will show the strength of purpose needed to succeed.
3.26 p.m.
LORD DAVIES OF LEEK: My Lords, may I thank the noble Lord who has just spoken, because I was interested in every word he said. I also knew that, inwardly, he was hurrying an excellent speech to be courteous to your Lordships' House. In fact I was prepared to listen if he had gone on much more slowly, because I thought the speech was absolutely excellent. If he does not think I am being condescending, may I say to him, "Thank you very much"? And, having heard the noble Lord, I tell him, secretly, as somebody who used to draw caricatures, that he has ruined my conception of "Selsdon Man". Having worked in another place and having heard of that marvellous conference, and having made oratorical arpeggios, upon the hillsides and in the cattle markets, of "Selsdon Man", what am I to do now, having listened to an excellent speech like that? May I take the noble Lord's cue and try to make my remarks in about eight to ten minutes, because there is very little fresh that one can say to your Lordships' House.
I would say to the noble Lord, Lord Hankey, that all of us agree about growth, and when somebody asks the very difficult question, "At what point is inflation

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dangerous?" I would reply that it is dangerous when it begins to eradicate the difference between the classes. A barrister friend of mine earning a very high income said that his father, who was about 90, had said to him, "My boy, you have got to face the fact that the day is going to come when a dustman's income will be only a hundred pounds or so below yours, despite the university education and everything else." In fact that is the trend of modern society. It was Bernard Shaw's equalisation of income point—absolutely. The old boy was very wise, but nobody noticed it. This is the trend all over the world. I do not say that everybody can have equal income, but notice the different connotation and the logic towards equalisation of income.
When we hear people say that the trade union movement should do this and do that, in the name of the Lord above I wish some of the noble Lords on both sides of the House would understand the trade union movement. Let us take the miners—and I come from Welsh colliers and farmers. In the British mining industry—Scots, Welsh, English; even the Irish have helped here—80,000-odd of the men gave up their jobs and were redundant; they moved out. I see the right reverend Prelate the Bishop of Durham—and I apologise to him for having missed his speech. I have listened to nearly every other one, but obviously I missed the best. In that area, and in South Wales, he knew what happened on the closure of the pits. In the Rhondda Valley, which I know quite well—and the Valley is so narrow they used to say that the river runs sideways—when I was a child there were 60 pits. Today there are only two pits in the Valley. What has happened to all those men? They have moved because of the institution by the Labour Government of redundancy payments; and they have done so with less bitterness than ever before.
In the textile industry, 90 per cent. of which is under private enterprise, tens of thousands have moved because of the constructive approach of the textile unions towards this problem. In other words, the trade union movement is not there only for increases in pay, but is one of the levers in society which controls the balance; and the Government had better be very careful what they do
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with this instrument which has grown pragmatically over 100 years of history and now does a first-class job of work. But if I am not careful I shall find myself answering points, and will not get on to my own speech.
I want to make this point. At page 15 of the Treasury Memorandum (Cmnd. 4579) there is a marvellous graph. I want to ask a question to which I hope the Minister will give an answer. I know that he will because, as usual, he is most courteous. Is the argument, based on that graph n page 15, that average earnings should always be below retail prices? According to the second graph, real wages are five points up. This is put forward as if it is some disaster. I hear sotto voce remarks from my noble friend below me. I had better inform him that the question has gone in the right direction and it has saved a lot of your Lordships' time.
The other question I would put is: how on earth do the Treasury, out of this Memorandum, cook up the magic figure of 10·9 per cent.? There is no mention of percentages in it whatsoever. How on earth do we get such different conclusions? That super-erodite publication called the Economist, using invective that no Welshman would ever use, is reduced to lashing at poor Wilberforce. It talks of the Report as being "vague", "imprecise", "emollient" (there is a euphemistic word for you!) "inaccurate". It reckons that the workers' real rise would be no less than 18 or 19 per cent.; that what the Wilberforce Inquiry has done in this seriously over-manned industry is to award about a 20 per cent. rise above average earnings. I do not know who writes these articles.
But let us turn to Wilberforce, to page 16, where the output per worker represents a dynamic figure. It says
"The number of manual workers per million kWh. generated fell from 2·4 in 1948 to 0·6 in 1969."
That is the operative figure; never mind all the others. Then, at the end of the paragraph it says that in the same period 1967–70 there were 26,000 fewer workers, while the kilowatts of electricity had risen from 11¼ million in 1948 to 18¼ million in 1969, and the consumption per head of population had increased from 830 to 3,450 kilowatts. What I find

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a damning indictment of this trivial society in which we live is when I watch a programme on television and this man Frost calls on a few people who are not so capable with their tongues and less able to put forward their point of view, and they are made the subject of a trial by television. And along comes a farmer, or some other individual, on television, before millions of people, punching these other individuals. Are we in a punching system of society to-day? This is the dangerous trend that we see to-day.
Two other points and then, despite the marvellous things that I was going to tell your Lordships, I shall conclude. The noble Lord, Lord Hankey, is most capable. I have read his stuff and that of his father before him. He has been in the most responsible positions. Was it not he (or perhaps it was the noble Lord, Lord Thorneycroft) who described the ship as sailing down; and, never mind what promises the captain had made, he must keep the ship on course and he could not take first-class meals down in the dining room. But at present the captain is standing on the bridge like that bravest of men, Captain Brown, who "played his ukulele as the ship went down". He did not have anybody to consult with until Wilberforce came along. And Captain Brown played it by ear. In my classic readings, Gibbon is one of my delights and one of my bedside books—I apologise to the right reverend Prelate for that. Nero was an excellent musician and he played his violin when Rome was burning. It was beautiful music. The Government who are governing this country at present cannot even read the music. I think they have taken a troglodyte attitude to the fundamental and delicate problems that are facing our society to-day.
The time has come for me to sum up. I hope that the House will forgive me if, because of the time factor, I do not get across some of the things I wanted to say. First and foremost, what worries me in the Treasury Memorandum is something which appears at page 3. I will not delay the House by a long reading from that page, but there is the implication in the last sentence that the Government no longer feel themselves responsible for full employment. I want to know if this is true or not. Most of us are old enough
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to remember the war and the famous Beveridge Report, one of the great and classic pieces of social work of the last fifty years. After we fought that last war, those of us who saw the misery from Scotland right down through Wales and in other places, and in the textile industry, swore that in a Christian nation we would never see again the degradation, the misery and abject poverty, that we saw in the 'thirties, when a man starved to death in the Savoy Grill. He was hungry and one night was found dead. We said "Never again!"
Let us beware, because the young men and women of to-day will not suffer that. In arbitration under the 1919 Act the Hobart Paper on Wage Fixing by the Institute of Economics makes a very fine point. Condensing it into a sentence, it says that when we have arbitration no Government should direct the court to make a decision that they would like. It seems to me that what is happening with Wilberforce is that the Report does not give the answer the Government would like. Never mind that! Forget its promises. Let us begin again, and try to start with a fresh slate to answer these vital problems pragmatically, because no man can answer them completely. He would be a fool if he pretended that he could.
8.40 p.m.
LORD VIVIAN: My Lords, it is always difficult to follow such an able and forceful speaker as the noble Lord, Lord Davies of Leek. However, I shall attempt to do so although not in content, which does not mean that to-day I do not agree with much that he has said. In common with other noble Lords, I should like to congratulate the noble Lord, Lord Shepherd, on the debate that he has introduced. In the middle passage of his introductory speech he referred to what he termed the present fear of inflation, and with regard to prices and incomes he posed the question—-I hope I quote him correctly: "Where stand the interests of the old-age pensioners, nurses and others in these difficult days?"
With regard to nurses, I do not feel that the noble Lord need worry himself unduly. Like the noble Lord, I was somewhat disturbed yesterday when I read in certain newspapers that whereas last week nurses were awarded a 12 per

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cent. increase in pay, they were now to face an 8 per cent. reduction of their lodging subsidy. Nurses, for whom I have spoken on three occasions in your Lordships' House, are not themselves concerned about this. The nursing fraternity recognise that they have the advantage of considerable subsidies and longer holidays than almost any other member of the community. As things stand, an 8 per cent. reduction of the lodging subsidy is considerably less than the 12 per cent. increase in the nurses' salary. The nurses have accepted the offer made by the Management Side of the Nurses and Midwives Whitley Council, and I can inform noble Lords that it is the considered opinion of Mrs. Yvonne Cross, who is the managing editor of the Nursing Mirror, that the nurses were well advised to accept the 12 per cent. offered by the Whitley Council. Mrs. Cross has told me that she has not heard a whisper of complaint. Indeed, she has told me that one student nurse said to her, "The public do not realise that we are not really as badly off as they think".
We have listened this afternoon to many notable speeches. Among them I would mention those by the noble Lords, Lord Thorneycroft, Lord Robbins, Lord George-Brown, and the instigator of this debate, the noble Lord, Lord Shepherd. Much has been said about the discontent of the workers. I agree with a great deal that has been said and with many of the points that have been made. We must make a definite move with regard to the control of any further inflation and the uncertainty that exists apropos prices and incomes. Speaking for myself, I have complete faith that my Government will move in the right way, and speedily. In resuming my seat, I should mention one other matter concerning nurses, and it is that I hope that my noble friend the Minister, Lord Aberdare, will constantly have before his mind the fact that nurses would, in the future, infinitely prefer to relinquish board and lodging subsidies in favour of a professional salary.
8.43 p.m.
LORD ARDWICK: My Lords, intervening at this time of night, it is a little difficult to avoid being tedious or repetitious. I hope that when I am repetitious I shall not be tedious, because my repetitiousness, if there is such a word,
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will consist of emphasising some of the points in this debate which I think ought to be emphasised.
I am slightly embarrassed. The debate has been so far-ranging that I wonder whether I really ought to return to the subject of the Wilberforce Report. I must say that I was pleased when the noble Earl the Leader of the House began by praising the excellence of this Report, which had been rather lost in the discussions of whether it was related to 10·9 per cent. or 16 per cent. The court emerges as fair, independent and rigorous. Many people would with today that it had been asked to bring these qualities to bear on the problems of the Post Office. Yet any fair-minded group of men examining any wage claim to-day are up against an insoluble dilemma; they have to judge in one particular case. They are not like a prices and incomes board hoping to have a general influence over wages and a general influence over prices, too, and working to an accepted norm or to a set of principles.
The first problem that a group like this has to face is the rise in the cost of living since the last pay increase was awarded. Even the Treasury admitted by implication, in their evidence to the Wilberforce Court, that this has to be taken into consideration. And that already pre-determines a sizeable increase. The retail price index, as the Treasury said, stood last November nearly 8 per cent. higher than it did 12 months before. So a union whose members have seen their standard of living erode in the past 12 months can hope to-day to see it restored. But how long is it going to be before it is going to be down again? The answer is about one month. So unions naturally, and realistically, are trying to get a bit more, or a lot more, to compensate for a further inevitable erosion of their pay.
That is where national policy has to say, "No". To build in a safeguard against an inflationary future is to ensure that that future will certainly be inflationary. It is, as Wilberforce points out, a self-fulfilling prophecy. The argument can be convincing to the unions, however, only if the principle is universally applied—and "universal" includes, of course, the private sector. But in the absence

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of a prices and incomes board and a comprehensive prices and incomes policy, there can be no such guarantee.
This is what the employees in the public sector mean when they claim that they are the victims of discrimination. The negotiators at Ford's, like the negotiators at Chrysler's, will settle on a principle different from that of the national interest. They will be concerned with the best long-term interests of their company, a perfectly justifiable principle in the absence of a truly national policy, and with a policy towards the private sector which consists only in exhortation and good advice.
The Wilberforce Report puts it sharply. There are still many who believe that inflation offers a means of increasing their standard of living. This is a fallacy. But wage negotiators are not likely to be convinced to the contrary if wages in other sectors, and prices, continue to rise at a rate beyond the increase they themselves have obtained. So the Court emphasizes, "with some force", as they put it,
"that staff in the electricity industry cannot be expected to accept settlements on the lines of previous years, unless there is moderation also in other pay settlements and some prospect of growth in their real earnings."
The inference is obvious. The Court could not, of course, without going beyond its brief, say out loud what it obviously meant: that you have to have a prices and incomes board of some kind. All it could do was to point to the obvious remedies: "a compulsory freeze", "some overall assessing machinery". "some consultative procedure". But then, having shown the dog the rabbit, they had to turn away because they were trespassing. And then, even when a wage increase to compensate for the past increase in the cost of living has been given to a public sector union, it will always perform less than it promises, because, apart from the common inflation, it will be sharply reduced by income tax.
As I pointed out in our previous debate on the Income Tax Bill, wages which are shockingly low to-day incur tax which is abominably high. And the reduction of the standard rate of tax will hardly touch the tax problem of the low paid worker. But again, the Wilberforce Court, when this point was put to it, quite rightly
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left it out of their reckoning. Taxation is a matter for Government, not for wage fixers. But it cannot be left out of the incomes/prices problem. Tax has been, I believe, an important element in the wages explosion. The causes of that explosion are complex. We know, as has been said in the debate to-day, that it has been a phenomenon of the whole industrialised world, and not of Britain alone. Those countries which have enjoyed rapid growth, which we have not; countries which have not suffered a devaluation, as we have done; countries which have not endured a wages freeze, as we have done, have found, as we have done, their unions militant and insisting on pay increases far out of line with those of the past. Yet when we discard the international scene and look at our own local conditions we find reason enough for our explosion.
There is a most revealing article in the current number of New Society, by the Professor of Industrial Relations at Cambridge, H. A. Turner, and Frank Wilkinson of the Department of Applied Economics. They take the case of a median worker, married with two children. In 1959, he was earning nearly £690 a year, but by 1970 he had made a most spectacular leap forward to £1,420. He had more than doubled his pay. Yet the gain was largely illusory. It was not something over 100 per cent. as it appeared to be. In real terms it was under 20 per cent. His take-home pay in 1959 was £650, but his take-home pay in 1970 was worth only £770 at 1959 prices. His tax had gone up to 16 times what it had been, in monetary terms, and his social security deductions had more than trebled.
Those authors also examined the case of the local government manual workers—the people who set off the first bomb in October, 1969. Their income between 1965 and 1969, which I must admit were the years of the Labour Government, went up on average nearly 6 per cent. a year, which sounds very reasonable. But the gain in their net real income after tax was exactly zero.
Those authors look, too, at the troublesome electricity workers. They have done even worse. Their net real income over that period was slightly reduced. One has to admit that the higher paid manual workers have done rather better, but over

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the whole decade even they have gained only 14 per cent. in net real terms—far less than the gains in industrial productivity over the whole period.
What has happened has not merely been an erosion in the value of money. As workers' wages rose their marginal rate of taxation increased sharply, and that is something which did not happen so much to those of us who were earning over £2,000 a year. The authors conclude that the 1970 wages explosion may well represent frustrated, but not perhaps unjustified, expectations. No wonder, when one looks at figures like this, that my Party was defeated in 1970. People could not work out sums, but they knew the truth in their bones out of bitter experience. No wonder the trade unions voted against an incomes policy at the Trades Union Congress in 1969, and no wonder the Conservative Government inherited—as we have to admit—a very difficult problem. No wonder, too, that the postmen, who are among the lower paid but highly taxed workers, have shown such obstinate solidarity.
What are the present Government doing about these very difficult problems?—nothing very constructive, I fear. They decided to wind up the Prices and Incomes Board at a stroke; they turned down the T.U.C.'s Economic Report at a stroke, and there is still no dialogue between the Government and the unions—only a few hints that there could be a dialogue. The noble Earl the Leader of the House referred to a Statement made by the Prime Minister in another place yesterday that he his willing to meet the T.U.C.; and there was a reference to a statement by Mr. Feather in the Daily Mirror this morning that the T.U.C. would like to talk to the Prime Minister. I should like to ask the noble Earl whether the Prime Minister intends to follow up that Statement with a formal invitation. The unions of this country are not very easy to deal with. But they are not impossible people; they are reasonable men.
I was delighted to hear the noble Earl say that, in principle, the Government rather favour a voluntary incomes policy. I did not know at all that this was their attitude. I thought that the gospel, as revealed at Selsdon Park, was against any kind of incomes policy. But if there is
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a change in thinking we all welcome it. Somehow the Government must get together with the unions and they must not allow two union leaders, powerful though they are, to create the image of the whole General Council of the T.U.C. The Government are not making things any better. In the trade union movement they are turning moderates into militants, and they are doing it far more by their general policies than by their Industrial Relations Bill. In fact, a great deal of the animus against the Bill is really a frustrated feeling against Government policy as a whole.
Where is it all getting us? There was a leader in the Financial Times yesterday, which gave a picture of the state of England in 1971. It said:
"Despite the Government's firm stand in the public sector, it cannot be claimed that its strategy for bringing wage increases under control has yet achieved more than moderate success. Meanwhile prices are continuing to rise, the economy is not growing as fast as expected, unemployment is moving steadily upwards and industrial unrest is spreading. Consumers are saving more, businessmen are investing less in new plant and equipment. The reason in both cases is uncertainty and lack of confidence in the future."
This is the Government of the Party which believed that it had only to come to power to restore confidence magically throughout the entire economy. And yet after nine months in power the Financial Times is speaking of a total lack of confidence in the future.
I think it is wrong of anybody, such as the noble Lord, Lord Robbins, to despair of a prices and incomes policy. That policy failed because, through nobody's fault, it was a fraud. The idea behind it, which made it acceptable to the unions, was that it was a way of creating planned incomes growth. But because of the balance of payments problem it turned out to be a way of planning a wages stop or a most severe wage restraint. The policy could only work against an expansion of the economy: only if there was a real growth of production making possible a real growth of income.
In their document, the T.U.C. said that the Government should look again at the possibility of a rate of growth of 5 per cent. a year. That may be too high; even 4 per cent. makes the Treasury shudder. But that, as Mr. Mortimer points out at the end of this Report, is a very defeatist attitude. Not only the T.U.C. but the

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whole nation, looking at the rising unemployment, the bankruptcies and the under-used resources, is to-day crying out for expansion. Have the Government not yet learned by experience that their simple idea—we heard so often when they were in Opposition that it is simple—of getting demand right cannot cope with cost-push inflation to-day?
It is years since that eminent Conservative, Mr. Aubrey Jones, so convincingly explained how this conventional wisdom has become conventional nonsense in modern economic conditions. To-day we have stagnation and inflation, and to say that we must wait for inflation to end before we can think of policies for growth—the noble Earl was really thinking over the whole lifetime of this Government when he was speaking his reasonable words about growth: he was thinking in much later terms than the present—is to say that we shall never go for growth, or we shall not go for it until this country is reeling under mass unemployment. The economists will tell us, as the noble Lord, Lord Robbins, said, that to inflate demand is to take a risk. Although demand-inflation is different from cost-inflation, the professionals will tell us that they do not belong to entirely separate categories, that they operate on one another, and we all know that that is true.
There may be a risk, but the risk of going on as we are going on now is a much bigger one; and it is a constructive risk for which we are asking, in place of the present destructive risk which the Government are taking. It is a constructive confrontation that we want between the Government and the unions, not the current destructive one. The Government should confront the unions with a programme of growth and see what kind of a deal they are prepared to give on prices and wages. And let the unions admit that the road that the Government and the unions together are taking us along now is the road to ruin, and that a change of direction cannot be made too soon.
9.0 p.m.
LORD CHAMPION: My Lords, it is usual for a winding-up speaker in this House to say that this has been a truly
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remarkable debate with speeches of a quality that can be heard only in this House. This is part of the normal courtesies of the House—a courtesy which at times seems to me to have an over-sweet, saccharin quality. But it seems to me that on this occasion such a remark would be wholly justified by the speeches that we have heard to-day. The subject is one that is of vital importance to the country, and the speeches have risen to a height in keeping with the occasion.
I very much regret that attendance at a Committee of the House prevented my hearing what was described to me as a quite remarkable and outstanding speech by the right reverend Prelate. I am told that much of his speech was devoted to the terrible tragedy of unemployment—the unemployment that he feared might rise to a total of one million if we are not careful, and if we do not do something about it. My Lords, living in a development area I am bound to say that I find the present unemployment figures frightening. I understand that since November last the rate of decline of employment in the development areas as a whole has been 35 per cent. greater than in Britain as a whole.
One of the first announcements of the present Government on coming into office was that they were going to switch from investment grants to tax allowances, and, in fairness, I must add that there was to be preferential treatment for the development areas. But, my Lords, the substitution of depreciation allowances for investment grants must reduce the cash flow which is so essential for a newly founded industry and will depend for its advantage on easy and early profitability. I think the noble Lord, Lord George-Brown, was quite right to stress the folly of this decision. I am told that already in Wales, where I live, inquiries for industrial sites are decreasing and opportunities for jobs are down. Only unemployment is rising. Government policies are effecting an upsurge in commercial bankruptcies; and rapidly increasing unemployment, not only in the development areas but in some areas hitherto immune from anything other than job-change unemployment, is pointing to a recession on a frightening scale, reminiscent of the inter-war years.

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When the Chancellor of the Exchequer made his first major policy statement in October last I remember commenting that it was the first true Tory statement of policy since the end of the last war, which means the first since the disastrous inter-war years. Since that statement we have had the "lame duck" speech of the Secretary of State for Trade and Industry, and we have had to-day the speech of the noble Earl, Lord Jellicoe, in which he told us that the Government intend to hold fast to the policies which were enunciated by those two Ministers. My Lords, this means that much that has been achieved in the years since the war, by both Labour and Tory Governments, in the management of the economy is to go down the drain, and we seem to be heading for the disasters of cyclic recurring recessions. Fortunately, the pressures of events are now causing the Government to change some of their ideas. Rolls-Royce, Upper Clyde Shipbuilders, the extension of the special development areas and the raising of the operational grant from 20 to 30 per cent. all point to the fact that the chill wind of reality is blowing through No. 10 and No. 11 Downing Street. The Government are learning, and will have to go on learning fast if really big economic disasters are to be avoided.
My Lords, the peg upon which we have hung this debate to-day has been the Wilberforce Report—an excellent Report, an outstanding Report. In paragraph 10.5. the Wilberforce Report points out with truth and force that
"… the one clear and paramount fact which emerges … is that the country is at present in a dangerous condition of spiralling inflation. … By 'dangerous' we mean a state of affairs which undermines, almost from the start, the real benefit of the wage increases sought, creates social injustices and resentments, and which if continued will threaten our balance of payments and destroy the value of money".
Most of those of us who have ever looked at these problems with only half the eye of a Robbins are bound to recognise the truth of that summary of our frightening immediate economic problem. But I am bound to ask: who is going to take any notice of it?
Chancellors of the Exchequer—certainly from Sir Stafford Cripps onwards—economists, politicians, newspapers, television
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and radio commentators have all uttered the same cry at intervals since the end of the last war. But who took any notice? Oft repeated, it became like the shepherd boy's cry of "Wolf!"; for, just as often as the trade unionist and others heard it, they went out into the street to see ever more and more cars parked in so-called working-class streets; the shops full of people buying things to which they were previously unaccustomed; "holidays abroad" agencies prospering mightily; and everywhere prosperity on a scale which makes our conditions in the interwar years look like dire poverty.
It may be that the Wilberforce cry of "Wolf!" really presages disaster. But the problem is: who is going to believe it? Certainly it will not be believed until intelligent trade union leaders and workers on the shop floor see that we have at least tried to stimulate growth in our economy. This means a deliberate and calculated approach to the problem. The Government must not make any mistake about it: the operation of market mechanisms, free and unrestrained, simply will not work to-day, any more than they worked in the interwar years or the years before 1914 to bring about a society free front boom and slump or to maintain full employment and a prosperous people. To-day, Governments have the tools at hand which will permit them to manage the economy in such a way that demand can be restricted or the pace of growth restrained, or the Government can stimulate demand and investment in the economy in such a way that growth can be enormously stimulated. Both require purposeful management on the part of the Government. What will not work in present-day conditions is what the Tory Government seem to be trying: that is, to let free market mechanisms bring about a reasonably balanced economy with just sufficient unemployment to cure what the Government would regard as the indiscipline of the workers and to lessen the demands of the trade unions. The age-old whip of unemployment in modern conditions will not have that effect. Neither will it cure inflation, as the recent experience of the United States of America has shown.
The Labour Government's decision that their initial task was to cure our chronic balance-of-payments problem

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was, I think, the right one in the circumstances of the huge deficit left by previous Administrations. This they did by restraining home demand by income and price controls, by holding down our home consumption and making our exports competitive in world markets. This policy had the further effect of keeping our growth rate down to a comparatively low figure—this with serious consequences when eventually price and wage and income restraints were beginning to cease to have any considerable effect. And this was happening at the same time as the policy to put right the balance-of-payments deficit was succeeding.
Obviously the time had come to enter into a new phase: namely, that of stimulating growth in the economy, growth at such a rate as would permit a reasonable expansion of wage and salary incomes—and this is the task now facing a Tory Government. This is the task to which I thought the noble Earl, Lord Jellicoe, was addressing himself when he said that the Government would have to try to stimulate growth in the economy to ensure that the inflation which we now see staring us in the face will at least to some extent be offset by greater productivity, a growth which would to some degree offset the inflation which is affecting us.
But let us make no mistake about it: economic growth of itself will not meet every demand. If you grow at 7 per cent. and incomes from all sources are demanded at 15 per cent., inflation will inevitably reverse the effect of the Labour Government's policies and we shall be back in a balance-of-payments crisis—to say nothing of the serious effect on persons of low and fixed income. Full growth necessitates full employment and, as Germany has shown, even the importation of workers to sustain it at a very high figure. I have said that the age-old whip of unemployment will not work in modern conditions. I agree completely with the remarks of the noble Lord, Lord Reay, on this point. Workers to-day will not put up with the evils of the inter-war years; for they are better educated, more informed, conscious of their power, more determined and led by men who know how effectively to use power.
To-day people do not believe, as in the last century or in the years before the
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First World War or in the 1920s and 1930s, that poverty and unemployment are the result of natural disasters. A serious recession to-day would be clearly recognised as the result of deliberate Government policy; and because people no longer believe that poverty and unemployment are the result of natural disaster, their reaction may well be more violent than anything this country has seen in many a long day. I do not believe that growth is the complete answer to the immediate problem of inflation: but I do believe that it must be the lead-up to the acceptance by all concerned of a prices and incomes policy. There has been a lot of talk of fear of having a prices and incomes policy again. But, my Lords, we cannot live in the sort of economy that we have unless we have a prices and incomes policy; it will have to come somehow.
As a trade unionist, I have always supported the Trades Union Congress policy of being prepared to co-operate with any Government who seek its co-operation over things advantageous to trade union members. Only by such co-operation within a growth situation can we hope to bring an end to the present disastrous inflation. But the will to co-operate is bound to be nugatory if one side feels that the other is out to destroy it. Rightly or wrongly, this happens to be the feeling of the trade union movement at the moment. My Lords, as I understand it, there has been an offer recently by the T.U.C. to co-operate in dealing with inflation. That offer was repeated in this morning's Daily Mirror. In one of the passages it states:
"I would put down no conditions on any talks with the Government. I would not expect them to lay down conditions either."
The Prime Minister has already said that he would welcome a chance to discuss economic policy with the T.U.C., but he did not issue a formal invitation. I regard it as the duty of the Prime Minister to issue such a formal invitation. I know it is difficult for the Government to do so, but they ought to accept that offer and meet the T.U.C. half-way by dropping the Industrial Relations Bill, at least for the time being; by which I mean that if it is found that co-operation cannot be secured by that means, the Government can always return to the Bill. But at least they ought to try it.

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The situation as it has been described in the Wilberforce Report, as it has been described by the noble Lord, Lord Robbins, by the noble Lord, Lord Thorneycroft, and by other speakers today is a dangerous situation for the country. If the situation is so dangerous, at least we ought to take exceptional measures to try to meet it. I believe that those exceptional measures include meeting the Trades Union Congress half way in an endeavour to secure that we get the co-operation of about the only body that can hold out any hope at all of curing the difficulties which are facing us. My Lords, recent events have shown how strong is the feeling in the trade union movement against the Bill. It makes real co-operation impossible until the Government make a major concession.
It might appear from what I have been saying that I accept the point of view that spiralling inflation is wholly due to wage and salary increases. That is the point of view that newspapers and others would have us accept. Indeed, reading the Wilberforce Report one might be forced to the conclusion that the Wilberforce Committee were of that opinion, were it not for a single sentence in paragraph 10.12:
"Nor is it to say that increases in pay are the only cause of inflation."
The word "only" is italicised. Mr. Mortimer deals with this aspect more fully in his Note of Reservation. I do not accept that inflation is due solely to pay increases, but I thought that this was what the noble Earl, Lord Jellicoe, was telling the House in his speech. Neither does the Trades Union Congress, which has examined the 11 per cent. retail price index between the end of 1967 and the end of 1969 and has estimated that 2 per cent. of that was due to increased indirect taxes—the point there being made by my noble friend Lord Ardwick; 3 per cent. to import costs; 0·6 per cent. to capital costs; and 3·4 per cent. to charges and salaries. If the T.U.C. estimate is correct—and I have no reason to doubt it—something less than one-third of that 11 per cent. price rise was due to pay increases.
In apportioning blame for inflation, I am bound to say that the prevailing high rates of interest not only shock me, but
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must also, with prevailing land prices, bear a heavy responsibility for the existing general climate of opinion about the value of money. The cost to companies of new borrowing and renewing existing loans is creating inflationary pressures down through the whole of industry; and undoubtedly the cost of borrowing is having an inflationary effect on rents, which in turn leads to wage and salary demands.
In 1968, the average rate of interest on debenture and loan stock was 8·24 per cent.; in 1969 it was 10·30 per cent., and in the first 10 months of 1970 it was 10·45 per cent. How much and by what percentage such outrageous rates of interest will increase the final cost of a product will depend on the product, but it will certainly appear somewhere in this computation, as will the local authority borrowing on loans, which, although they contain scarcely any labour element, have also gone up faster recently than nearly every other item that appears in the retail price index. High rates of interest have another effect, which may be making sterling look good internationally, but it attracts much too much "hot" money for my liking. For not only is it an unstable element in our economy, but we have to pay the interest on it. And this fact, added to the inhibiting effect on investment of high rates of interest, calls for early action by the Government.
What has emerged from this debate is that there is a general acceptance of the fact that upward spiralling inflation is threatening the whole future of this country. There is disagreement, perhaps, about the causes and events which have led up to our present economic situation, but there is a wide measure of agreement that something must be done by Government and others about it. The Government by themselves cannot solve this problem. For it is the sort of situation in which only Government in co-operation with the people can hope to do that. Meaningful talks with the representatives of a large and important section of the people, namely, the T.U.C., might mean for both the T.U.C. and the Government a delibate retreat from the fixed positions already taken up. But, my Lords, it is worth trying. I urge the Government to try it in the interests of the future of the people of this country.
9.24 p.m.
LORD ABERDARE: My Lords, I am sure that the noble Lord, Lord Shepherd, will feel that he has succeeded in introducing an extremely interesting debate. It is one in which he set, if I may say so without presumption, a moderate tone, with a carefully thought-out speech, which has been followed by many noble Lords from all sides of the House. I should like to associate myself with the tribute your Lordships have paid to the noble and learned Lord, Lord Wilberforce, and his colleagues for their Report, which has come in for a great deal of praise from all sides.
The debate has not stuck particularly closely to that Report, but has ranged over such subjects as management, training and the Consumer Council among others. The noble Lord, Lord Shepherd, called this an economic debate, and so indeed has it turned out to be. We have covered a very wide spectrum of every aspect of our economic affairs, broadened early on in the debate by the speech of the right reverend Prelate, the Lord Bishop of Durham, who gave it moral and social dimensions. At this hour of the night I hope that he will forgive me if I do not follow him in quite so wide ranging a speech, but I know that your Lordships appreciated his contribution, and it was valuable to have these other aspects of the matter brought in at an early stage.
Since then, many of your Lordships have made extremely valuable contributions from all sides of the House, and I would agree most warmly with the remarks of my noble friend Lord Thorneycroft when he said words to the effect that facing a situation as grave as we do at present we cannot but welcome any words of helpful, constructive criticism from wherever they may come. And surely your Lordships' House will agree with the noble Lord, Lord Champion, that this is an ideal forum for a debate of this sort. Although I regret that I shall not be able to comment in any detail on most of the speeches that have been made, I can assure your Lordships that we will look at them and study them with great care.
My noble friend Lord Brooke of Cumnor, who made a most valuable contribution to the debate, said that our
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policy must cover the whole economic scene, and not simply a so-called prices and incomes policy. This was what I hope your Lordships will agree my noble friend Lord Jellicoe did at the beginning of the debate in giving your Lordships a wide-ranging account of Government policy throughout the field. I hope your Lordships will agree that as he gave such a thorough exposition of Government policy it might be better if I were to cut my remarks fairly short and achieve perhaps a slight de-escalation in Front Bench speeches.
I apologise to those noble Lords I cannot mention, but there are one or two speeches I should take up, and one or two points that were specifically asked of me. I cannot resist starting by commenting on Lord George-Brown's speech which, naturally, like all his previous speeches, was very enjoyable. I thought he was very unjust to my noble friend the Leader of the House in his reference to my noble friend's speech, which I think the rest of your Lordships found to be of great interest, and a very thorough exposition of the Government's thinking on this subject. However, he did not think so. He then went on to give us a lecture on the prices and incomes policy as he saw it, as if he had himself been the author of such a successful policy. I tried to make out what his recommendations to us were, and it seemed to me that he was saying, "Bring back the Prices and Incomes Board, the Industrial Reorganisation Corporation, investment grants and the whole kaboodle". And maybe even the noble Lord himself might return, now that he has become an industrialist rather than a trade unionist—
LORD GEORGE-BROWN: Is not that silly?
LORD ABERDARE: But I really did not think—
LORD GEORGE-BROWN: Is not that rather silly?
LORD ABERDARE: —that his speech contributed very much to the positive policies that we are trying to pursue.
LORD GEORGE-BROWN: I am sorry, my Lords. Would the noble Lord please forgive me? Would he not like to rethink that last remark? I was trying

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to help. I gave some advice which I thought Ministers in the present situation might like to think about. Was that not a rather cheap remark, even for the noble Lord, Lord Aberdare, to make?
LORD ABERDARE: My Lords, I do not think we will pursue this any further. The noble Lord was not all that kind and considerate about my noble friend the Leader of the House, and I do not think he deserves more than he gets back.
LORD GEORGE-BROWN: Just cheap. That is why you are failing.
LORD ABERDARE: Other noble Lords mentioned various aspects of regional development policy, particularly those of your Lordships with interests in the regions—the right reverend Prelate the Bishop of Durham, the noble Lord, Lord Hoy, the noble Lord, Lord Davies of Leek, my noble friend Lord Selsdon, and the noble Lord, Lord Champion. I would say straight away that it is certainly no part of our policy to create unemployment. The sad figures of unemployment are rising because of inflation, and we shall do all we can to put that right.
We have, and we are committed to, a vigorous and flexible regional development policy as an important component of our overall economic strategy. We have identified within it three major fields for action which I think are familiar to your Lordships. One, of course, is the replacement of investment grants by investment allowances, on which many of your Lordships have commented. I can only draw your attention, as the noble Lord, Lord Champion, did, to the fact that the Chancellor of the Exchequer announced on February 18 that the operational grants in the special development areas, under the Local Employment Act, have been increased to 30 per cent.
Secondly, we have carried out a detailed investigation of the extent to which the coverage of the assisted areas continues to reflect the real pattern of need. As your Lordships will know, the Government have decided to give special development area status to West Central Scotland and to the Tyneside-Wearside area, and to extend special development area coverage in the South Wales valleys.
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I hope this action is positive proof that we are concerned about our regional employment policies. We are also paying special attention to the provision of infrastructure and improvement of the environment in the development areas.
The noble Baroness, Lady Wootton of Abinger, was critical of our present approach of reductions (I think she preferred the word "reductions" to "de-escalations") and said it was likely to be more unfair than a freeze. I do not believe this to be so. The present approach is, or should be, more flexible than a freeze. It is to reduce the general levels of settlement progressively, and does not exclude exceptions to this progression where there are special factors—for example, in the case of the police. My right honourable friend the Secretary of State for Employment has indicated that there is a case for above-average percentage increases for the lowest paid workers, provided that these are net followed by identical percentage increases for higher paid workers to restore differentials. I listened with great interest to the noble Baroness's own proposals, which had clearly been most carefully thought out. I regret to say that I personally found them rather too mechanistic and complex, and they would certainly involve a degree of statutory intervention which went far beyond the last Government's proposals.
The noble Lord, Lord Davies of Leek, asked me a number of questions. I have the answer to one of them, but perhaps I may let him know later about the others. He asked about money earnings. In the immediate situation we must rapidly reduce the rate of growth of money earnings if we are to bring down the rate of growth of prices. Failure to do so will threaten both future growth and existing standards of living. But, as my noble friend the Lord Privy Seal said, it is a major objective of the Government's policy to increase the rate of growth of real earnings in the lifetime of this Parliament.
I am grateful to my noble friend Lord Vivian for his remarks on nurses, and I listened with interest to what the noble Lord, Lord Ardwick, and the noble Lord, Lord Champion, had to say about the T.U.C. and the Prime Minister. I think my noble friend Lord Jellicoe went as

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far as it is possible to go to-day on this matter in repeating what the Prime Minister said yesterday, that he was willing to discuss economic policies with the T.U.C. at any time if they wish to do so. But, of course, as I think the noble Lord, Lord Champion, certainly realised (I do not think the noble Lord, Lord Ardwick, made quite that point) Mr. Victor Feather, in his Daily Mail article—
SEVERAL NOBLE LORDS: Daily Mirror.
LORD ABERDARE: I beg your pardon, my Lords—the Daily Mirror. Many apologies. In his article in the Daily Mirror he said:
"Let the Government put the Bill to one side and get down to real issues".
LORD ARDWICK: My Lords, we must never be dismayed if an olive branch has one or two thorns on it.
LORD ABERDARE: My Lords, the debate as a whole has accepted that there is indeed a real danger of serious inflation which threatens our standard of living, and no one who has spoken has underestimated the gravity of the present situation. I found that the speech of the noble Lord, Lord Robbins, summed up the situation far better than I could possibly do, and I found myself in total agreement with the analysis that he gave. This included the fact that the cause of the present inflation is the very rapid rise in wage costs, far and away beyond what could be justified by increased productivity. Moreover, it is an unfortunate fact that a wage cost inflation feeds on itself. Higher wage costs lead to higher prices; higher prices lead to demands for higher wages, and so on.
This was the situation which faced us when we came into office. The previous Government's prices and incomes policy had collapsed, prices were rising rapidly month by month and pay settlements were running at a rate of more than 10 per cent. It was in those circumstances that we had to decide which of the alternative policies open were best suited for controlling the situation. Statutory control of prices and incomes had been demonstrated to be a failure, despite the efforts of the Labour Government.
May I quote the O.E.C.D. survey of the United Kingdom, published in
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November last, which stated the position with great clarity? It said:
"The overall impression is that policies have been able to restrain prices and incomes over relatively short periods. The greater the degree of pressure the authorities were in a position to apply, the more immediate and dramatic was the effect. But in periods of restraint stresses have built up which have finally broken through and led to a rebound of wages and prices. Over the longer run therefore it is doubtful whether the net effect has been more than mildly beneficial."
The alternative was to use every means consistent with our general outlook on economic affairs, short of statutory interference, to bring about a progressive and substantial reduction in the level of pay settlements. That has been our object; and although there is still a hard, long road to run the upward spiral has been checked.
We have been told to-day, and we have been told in Parliament and outside, that we have not got a prices and incomes policy, or that we have a negative policy; or (as I think the noble Lord, Lord Shepherd, said) that we are running away from such a policy. And we have been urged to produce a positive policy. I would suggest that the words "positive" and "negative" in this context are being misused: "positive" to mean a formal prices and incomes policy with all the paraphernalia of norms and criteria, and "negative" to mean non-statutory action. Of course we have a positive policy, but it does not extend to statutory control of prices and incomes. We have urged upon employers and employees, in both the private and the public sector, the importance of restraint in wage settlements; and in the public sector, where we have a special responsibility, we are using all our influence to prevent excessive settlements.
My Lords, as I said at the beginning and as my noble friend Lord Brooke of Cumnor stressed, in the fight against inflation it is very important to consider the whole of the Government's economic policy, not just that related to prices and incomes. Fiscal policy is clearly important, but with the nearness of the Budget I regret that there is nothing much I can say about it this evening. So is monetary policy, where three alternative courses were open to the Government. First, a neutral monetary policy, seeking to control inflation by not allowing the money supply to grow more than enough to

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finance the annual increase in output arising from increased productivity. Such a policy would no doubt check the current inflation at a cost, but the cost would be far too severe—business failures, increased unemployment and a general check to production and investment, which I am sure would be quite unacceptable to all your Lordships.
Secondly, we could pursue a passive monetary policy, simply to allow money supply to grow to whatever extent was needed to finance the growing demand for cash and credit. But this would simply aggravate the problem and would do nothing to help its solution. So, in our view, the monetary policy appropriate to the present situation is that which this evening was approved at least by the noble Lord, Lord Robbins: one that does not passively provide the amount of money needed to underwrite the going rate of inflation, but something less; equally, not one that seeks to be sufficiently stringent to curb inflation by itself. The main remedy must lie in the reduction of wage settlements, and the main role of monetary policy in the circumstances must be to ensure that cost inflation is not aggravated by the emergence of excess demand. This is the Government's policy. It is a positive policy, but it is one that stops short of statutory control.
My Lords, there is one more plank in our policy that has a bearing on the solution of these economic problems, and that is the Industrial Relations Bill. In view of the fact that we shall no doubt be spending a good deal of time on this Bill in the near future, I do not think it would be right to go into it in detail now; but I feel sure that it will strengthen the hand of the responsible trade union leadership. And anything that improves our wage-bargaining procedures, anything that increases responsible trade union influence and restrains the activities of wildcat strikes, is bound to be of the utmost benefit.
I have referred to the O.E.C.D. survey. I was interested in one particular part of that, where it confirmed what others of your Lordships have said this evening: that we are not alone and that most other countries have also been suffering from rapidly increasing costs and prices. But the survey went on to say that a number of these other countries are taking active
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steps towards a restoration of more stable cost/price trends. I have tried to find what those other countries were doing, because it might be a lesson to us, and further on in that same survey there is a significant sentence discussing the Industrial Relations Bill. It says
"This should introduce into the United Kingdom framework some of the aspects which have been useful abroad".
This we indeed believe to be the case.
My Lords, I will come to a conclusion. I hope that all of your Lordships feel that we have had a useful debate. I hope that my noble friend and I have at least been able to answer some of the questions that have been put to us. We are only too ready always to discuss new ideas new policies designed to solve this most pressing problem. But in our view our present policy in dealing with the immediate problem with which we are faced is the best. We believe that it will work. I personally have been encouraged by various speeches that have been made to-day. Again, if I may refer to him, the noble Lord, Lord Robbins, thought that there was quite a good chance that these policies would work.
LORD WYNNE-JONES: My Lords, would the noble Lord forgive me for one moment? Does he recollect that about five years ago the noble Lord, Lord Robbins, informed us that the policies of the then Government were going to work because of their method of tackling the problem of the balance of payments?
LORD ABERDARE: My Lords, I am sure that the noble Lord, Lord Robbins, is a wiser man to-day than he was five years ago. I was also much encouraged, and I recognise it as most important, by what was said by another Member of your Lordships' House, that the important thing is that if we can get this system to work it will be to the advantage of everybody: it will be to the advantage of the trade unions and to the advantage of the Government not to have any kind of statutory interference. We feel that we have the right policy, and we hope that we shall be able to steer this ancient ship of State out of the present dangerous rapids of inflation into the calmer waters of economic progress.
9.47 p.m.
LORD SHEPHERD: My Lords, at this late hour I think I must limit my remarks. I should like to do three things. First, I should like to thank all noble Lords who have taken part in what, on the whole, has in my view been a notable debate. I agree with the noble Lord, Lord Thorneycroft, in that at one moment I wondered whether I was right in putting this Motion in this particular form. In the end, think I was right.
Then I must congratulate the right reverend Prelate and say how much we on this side of the House—not enjoyed, because I think that in view of the sombre note of the right reverend Prelate, to say one enjoyed his speech would be wrong: but how much we appreciated all that he said. I am certain that those in the North-East must feel very happy that they have a great battler on their behalf in this House of Parliament.
I can only say to the noble Earl, Lord Jellicoe, that I thought his speech one of great complacency. I will add only this. I deliberately kept personalities out of my speech. Since the opening of this Session we on this side of the House have been particularly careful in this respect. I should tell the noble Earl that if he once again brings into this House, no matter how amusing he may think it to be, what we on this side regard as a cheap sneer, then the gloves will be off and your Lordships' House will suffer as a consequence.
So far as the noble Lord, Lord Aberdare, is concerned, I think it rests with him to decide how adequately he answered the debate. I only ask him to read what my noble friend Lord George-Brown said. It may be that the noble Lord was unable to take in my noble friend's points. I think that if he had taken them in he would not have replied to my noble friend in the way that he did.
LORD ABERDARE: My Lords, I do not wish to cause any of your Lordships any offence. The noble Lord, Lord George-Brown, had some rather tart things to say about my noble friend, and
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I thought I was legitimately entitled to answer him back.
LORD SHEPHERD: My Lords, I have no objection at all to tart remarks being made in reply to tart remarks; but I thought that the noble Lord's attitude to the speech of my noble friend showed that either he did not take it in or that he could not have appreciated the points made. But I would not wish to spoil what I think has been a good debate by unseemly scenes. My Lords, I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

VEHICLES (EXCISE) BILL
Returned from the Commons agreed to.
ATOMIC ENERGY BILL
Returned from the Commons, with the Amendments agreed to.
MR. SPEAKER KING'S RETIREMENT BILL
The LORD CHANCELLORacquainted the House that the Bill had been endorsed with the Certificate from the Speaker that the Bill is a Money Bill within the meaning of the Parliament Act 1911.
NEW BROKEN HILL CONSOLI DATED COMPANY LIMITED BILL [H.L.]
Presented, and read 1a.

CUMBERLAND RIVER AUTHORITY BILL
KILLINGHOLME GENERATING STATION (ANCILLARY POWERS) BILL [H.L.]
Reported, with Amendments.

  IMMIGRATION: U.K. PASSPORT HOLDERS AND ENTRY REFUSALS
  IMMIGRATION: U.K. PASSPORT HOLDERS AND ENTRY REFUSALS