Sitting of 16 November 1972

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

    Threats of Violence
    Mr. William Hamiltonasked the Secretary of State for Northern Ireland what steps he intends to take against the so-called loyalists who threaten violence against Her Majesty's Forces.
    The Minister of State for Northern Ireland (Mr. David Howell): I would refer the hon. Member to the reply given by my right hon. and learned Friend the Attorney-General to a Question by the hon. Member for Manchester, Blackley (Mr. Rose) on 9th November.—[Vol. 845, c. 250.]
    Mr. Hamilton: Can the Minister of State say what steps are being taken to remedy the ludicrous situation whereby members are financed by the British taxpayer to be trained in the UDR and are simultaneously members of the UDA? I do not wish to take sides in the matter, but is it not equally ludicrous that Mr. William Craig can make the kind of speeches that he has been making and still remain a Privy Councillor?
    Mr. Howell: On the hon. Gentleman's second point, these kind of wild speeches are to be deplored. They make a mockery of the whole idea of the word "loyalty". On the question of membership of the UDR and the UDA, where there has been any evidence or sign of overlap, or even collusion, these matters are investigated carefully, and are for my right hon. Friend the Secretary of State for Defence. On the hon. Gentleman's first point, 10 people have been
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    arrested and charged with receiving weapons from the UDR. This is a matter that concerns the Government greatly, and it is watched very carefully.
    Mr. Kilfedder: I condemn violence from any section of the community, but does my hon. Friend agree that it is wrong to equate the violence of the IRA with the actions of some misguided loyalists, for whom there is the explanation that they have allowed some three years of terrorism and, admittedly, a sectarian campaign to break their praiseworthy restraint?
    Mr. Howell: Arguments of frustration and violence there may be, but the plain fact is that violence is violence and law-breaking is lawbreaking. They must be dealt with firmly by the law and by the security forces wherever they occur.

    House Purchase (Loans)
    Mr. Stratton Millsasked the Secretary of State for Northern Ireland if he will make a statement on his proposals to assist persons in Belfast who are unable to obtain building society loans because of the troubles; and if he will authorise the Housing Executive to commence a large-scale scheme whereby they purchase houses which the occupants have been unable to sell, and let them out to suitable tenants.
    The Under-Secretary of State for Northern Ireland (Mr. Peter Mills): The Northern Ireland Housing Executive intends to introduce a scheme within the next few weeks for granting loans for house purchases. This should help people who are unable to obtain building society loans.
    An inter-departmental working party has been examining the possibility of aiding owner-occupiers who, because of the disturbances in certain areas, are unable to sell their houses. My right hon. Friend hopes to have its report shortly.
    Mr. Stratton Mills: Is the Minister of State aware that his reply will be broadly welcomed? One hopes that the scheme will be pressed on speedily.
    Mr. Peter Mills: I am grateful to my hon. Friend for saying that. Certainly we are seeking to do something in this matter. I am pleased to say that for owner who cannot sell their properties

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    not only is the Housing Executive seeking to buy up some of their houses; they will give help with the cost of purchasing their houses, including agents' fees and legal fees, where appropriate.
    Mr. Pounder: I thank my hon. Friend for a very helpful answer. Where the mortgagors have left because they have been intimidated, or whatever, there is no point in repossessing the property and trying to sell it. One is faced with the problem of getting rid of the property. Can the scheme be extended so that the building societies can be assisted by the Housing Executive in taking up these properties?
    Mr. Peter Mills: It is true that the building societies have been most helpful in very difficult circumstances. While I am not now in a position to answer my hon. Friend's question, I will look into it and see whether the building societies can be assisted in that way.

    Civilian Deaths
    Mr. McMasterasked the Secretary of State for Northern Ireland what has been the total number of civilian deaths in Northern Ireland since 25th March, 1972; and how many of these have been women and children.
    The Minister of State for Northern Ireland (Mr. van Straubenzee): 237, between 25th March and 16th November, 1972, including 19 women and 23 children under 16.
    Mr. McMaster: Does the Minister of State appreciate that that is a very much higher casualty rate than before the political initiative in March? Will my hon. Friend give first priority to tougher security measures, which are necessary to reduce the terrible toll of death and injury.
    Mr. van Straubenzee: It is undeniable that there is a terrible toll of death and injury, but the inference in my hon. Friend's question seems to be that the toll is in some way due to the action of the Government. That I must firmly question and refute. My hon. Friend will know that very firm action is being taken and I absolutely pledge that that will continue.
    Mr. Stallard: Is the Minister of State aware that there is a great deal of con-
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    cern about the erection of what are called car-bomb preventive barriers? The Chief of the Belfast Fire Brigade said this morning that the barriers may prove to be a fire risk, and will possibly increase rather than decrease the number of casualities. Will the hon. Gentleman look again at these preventive barriers?
    Mr. van Straubenzee: The problem of these barriers is being looked at by the Army. Any question of the law being taken into individual hands, by whoever it may be, is strongly to be deprecated.

    Illegal Arms (Prosecutions)
    Mr. Thomas Coxasked the Secretary of State for Northern Ireland if he will give the number of prosecutions during the last 12 months in Northern Ireland for the illegal possession of arms.
    Mr. David Howell: The figure is 484
    Mr. Cox: I am sure that the Minister will agree that these are extremely disappointing figures in view of the known vast numbers of illegal arms that are in circulation. Can the hon. Gentleman say what further action the Government intend to take to try to reduce the number of illegally-held arms, and can he, in particular, say what action they intend to take to stop the exportation of arms from this country—especially from the north of England and Scotland—to Northern Ireland?
    Mr. Howell: The security forces always want to capture more illegally-held arms, but it would be wrong to write down the very considerable successes there have been in discovering caches of arms. Major finds have been made in both Protestant extremist areas and in Provisional IRA areas in many places in Belfast and the countryside, and considerable numbers of illegal weapons have been picked up. Nevertheless, we remain very concerned about, and are making stronger efforts to stop, the importation of weapons used to murder innocent women and children, and soldiers.
    Mr. Stratton Mills: I join in those sentiments, and welcome the very great success of the robot telephone system, but has my hon. Friend any estimate of the total number of illegal arms held at present in Northern Ireland?
    Mr. Howell: I cannot give an estimate. Almost by definition, the arms we do not know about are those that we want to find. There can be no estimate of illegally and secretly held arms.

    Royal Ulster Constabulary
    Mr. Michael McNair-Wilsonasked the Secretary of State for Northern Ireland what discussion he has had with the head of the Royal Ulster Constabulary about reorganising the force in such a way as to make it more able to take back responsibility for internal security in Northern Ireland.
    Mr. David Howell: My right hon. Friend's discussions with the chief constable and the police authority on the future internal security role of the Royal Ulster Constabulary have shown that the real need is not a reorganisation of the force but a steady build up of its effective strength. This is being achieved.
    Mr. McNair-Wilson: My hon. Friend will no doubt remember my right hon. Friend's statement in the debate on Monday that the establishment of the force was to be 5,000 in 1975. The establishment of the force is now just over 4,000, at a time when crime has never been more prevalent and when detection rates are ever lower. We have the chief constable's report, and there is no doubt that the RUC—
    Mr. Speaker: Order. This is Question Time. What is the hon. Member's question?
    Mr. McNair-Wilson: I am leading up to the point I want to make, Mr. Speaker. In those circumstances, is my hon. Friend satisfied that this figure of 5,000 by 1st April, 1975—three years away—is credible?
    Mr. Howell: My hon. Friend should distinguish between establishment and actual success in recruiting. We would, of course, like to go beyond an establishment of 5,000, but there is no point in raising the establishment to that figure until we have recruited manpower to the existing establishment level. At the moment recruiting has taken an encouraging up-turn, but we want to move forward. If we are successful we shall be able to raise the establishment figure but,
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    as I say, to do so would be pointless until we get the necessary manpower.
    Mr. McMaster: Is the Minister of State aware that with the present increase in violence in Northern Ireland, the growth of such bodies as the UDA, and with really a war-time situation, many people would be willing to help in the formation of civil defence corps? Could not these be enlisted by the Army to protect people from bombings and shootings by night in Belfast?
    Mr. Howell: Those who are willing to help have the UDR to join, if they so wish, or they can apply, if they have the necessary qualifications, to join the police or the police reserve, which are recognised official security forces and the forces of law and order. They can join these if they so wish.
    Mr. McNamara: The Minister of State has just said that people can join the UDR and other organisations. Will he now state what on Monday night his hon. Friend was not prepared to state, which is that membership of the UDA is not compatible with membership of the UDR or any other recognised security force in Northern Ireland?
    Mr. Howell: The Government's view is quite clear. It is that the first loyalty of members of the UDR is to the security forces, and to the Army. That has been clearly said.
    Mr. Goodhartasked the Secretary of State for Northern Ireland what action he proposes to take to increase recruiting for the Royal Ulster Constabulary.
    Mr. Peter Mills: I would refer my hon. Friend to the reply given to a Question from my hon. Friend the Member for Down, North (Mr. Kilfedder) on 15th November.
    Mr. Goodhart: Does my hon. Friend recognise that one of the most disturbing factors in the security situation in Northern Ireland is the low state of morale in the Royal Ulster Constabulary; and that this is bound to be an inhibiting factor in getting the recruitment that we all want?
    Mr. Mills: While not agreeing entirely with my hon. Friend, the problems over there and the vulnerability of the police make recruitment extremely difficult. That must mean that we should give every

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    encouragement to them that we possibly can, and so encourage the further recruitment that we are seeking.

    Trade Unions (Meetings)
    Mr. Douglasasked the Secretary of State for Northern Ireland if he will list the meetings he has had with representatives of the trade union movement in Northern Ireland.
    Mr. van Straubenzee: My right hon. Friend met the Northern Ireland Committee of the Irish Congress of Trade Unions on 5th April, 15th May and 13th September, 1972. He met Mr. William Blease, the Northern Ireland officer of the committee, on 18th September and 31st October.
    Mr. Douglas: Am I correct in understanding that meetings will take place between his right hon. Friend the Prime Minister and representatives of the Irish trade unions in Belfast over the next day or so? Can we have a statement in the House at the earliest possible moment about these meetings, because it is of the utmost importance that we should appreciate that the trade union movement in Northern Ireland is playing a vital part in keeping business going in the Province?
    Mr. van Straubenzee: The trade union movement to which the hon. Gentleman refers is one of those bodies which will have the opportunity of making representations to my right hon. Friend the Prime Minister, for he is consulting a very wide section of opinion in Northern Ireland. I gladly join with the hon. Gentleman in the tribute that he has rightly paid to the trade union movement in Northern Ireland.
    Mr. Wilkinson: As the Prime Minister would, in the words of the Secretary of State, like to appraise himself of the facts as they are, will he also endeavour to see the United Loyalist Council, because it is most important that firmly held Loyalist opinion should be clearly understood by the Government in seeking to achieve a just solution?
    Mr. van Straubenzee: I think that my right hon. Friend had it in mind to see representatives of those bodies whom he had not had an opportunity to meet and, in the political field, to do so with established political parties.

    Isolated Families (Protection)
    Mr. Kilfedderasked the Secretary of State for Northern Ireland, if he is satisfied with the measures taken by the police and the Army to provide continuous protection for isolated families living in Border areas in County Fermanagh, particularly where a member of the family is serving in one of the forces of the Crown; and if he will make a statement.
    Mr. David Howell: The security forces are taking all practicable steps to help protect families who live close to the Border with the Republic of Ireland.
    Mr. Kilfedder: My hon. Friend cannot really believe that I can be satisfied with that answer, particularly in view of Republican terrorist action in the past few weeks along the Border in Fermanagh when, for instance, there was a five-hour siege of the Latimer family farm, the murder of two Protestants in Derrylin, the murder of a member of the Ulster Defence Regiment and the attempted murder of his brother, who also serves in the UDR, when both were off-duty and were travelling to their farm. Many other people along the Border, not just in Fermanagh, are living under the threat of death. Are not these British subjects entitled to the same protection as other subjects in the rest of the United Kingdom, instead of being exposed to activities by terrorists who operate from the other side of the Border and live in a Wild West situation reminiscent of the worst period of American history?
    Mr. Howell: I agree that these are appalling incidents, and constant efforts are being made by the security forces—by means of patrols, and so on—to prevent or minimise the sort of atmosphere being created. My noble Friend the Minister of State was down on the Border a week or two ago and made a very close study, and has reported in detail on his conclusions. At the same time, further discussions have been continuing about the way in which Border security can be strengthened so that we can come to decisions on these matters, but we recognise that this is an extremely difficult situation.
    Mr. Merlyn Rees: Is the Minister aware that we met residents from

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    Fermanagh, as I am sure other Members did, and we know that life is impossible for people on the Border? We understand the Army's difficulties because of the spread-out nature of the terrain. Is there not a radio communication system similar to that used by car-hire firms which could be set up in the area to enable people whose lives are quite terrifying, from the descriptions we hear, to get into touch with the security forces at short notice?
    Mr. Howell: The security forces are, of course, in radio contact with each other, but it may be possible to develop a wider network of radio communication. We recognise the difficulties. I have been down there and seen some of the unpleasantness of it. The prime consideration is that to close and patrol the Border with massive manpower would take troops away from areas where they are being highly effective against the IRA. That may be exactly what the IRA want.
    Mr. Stratton Mills: Has my hon. Friend any new proposals to meet the worsening situation in the Border areas, and will he look carefully at the suggestion of a radio network?
    Mr. Howell: New proposals are being studied, including the idea of vehicle documentation, and decisions will be made.
    Mr. McNamara: Is the Minister of State aware that this is a problem not just within the so-called Loyalist community but also in the so-called Nationalist community? There is fear on both sides in the Border and country areas. Therefore, the idea of my hon. Friend the Member for Leeds, South (Mr. Merlyn Rees) for some sort of radio communication for civilians—as used with walkie-talkie systems by policemen in this country—would be just the sort of thing for isolated hamlets of both Loyalist and Nationalist communities to protect them from intimidation.
    Mr. Howell: That is an idea—and a number of other proposals are being and will be studied.

    Imprisonment and Internment (Commission Report)
    Mr. McNamaraasked the Secretary of State for Northern Ireland when he
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    expects to receive the report on the committee appointed to examine the Special Powers Act.
    Mr. Peter Archerasked the Secretary of State for Northern Ireland when he anticipates receiving the Report of the Commission on Imprisonment and Internment in Northern Ireland.
    Mr. David Howell: I assume that hon. Members are referring to the commission chaired by Lord Diplock which is considering the administration of justice in connection with terrorism in Northern Ireland. The commission is proceeding with its work with great urgency; but it is too soon to say when its report will be received. My right hon. Friend is reviewing those parts of the Special Powers Act outside the commission's terms of reference.
    Mr. McNamara: I am grateful to the Minister of State for his reply, but will he bear in mind that whatever procedure is employed—be it the detention of terrorists order or the old straight forward detention and internment order as existed under Unionist-controlled Stormont—the present method of dealing with people suspected of terrorism—and the Government have yet to define that term—is unsatisfactory? The general body of the public must be given the opportunity of weighing, judging and considering the evidence against those people who are interned. Until that is achieved this continuing sore will exist and cast into grave difficulties whatever hopes the Government have for a successful policy.
    Mr. Howell: The ideal which the Government and everyone else would like would be the normal and effective processes of the workings of the law. I do not accept the hon. Member's coupling of internment with the present processes under the detention of terrorists order, which is to be debated here shortly, or with the new proposals which may emerge from the Diplock Commission. Under the detention of terrorists order legal representation is allowed, as are appeals. That is a definite improvement on the internment process, and one that should be welcomed.
    Mr. Peter Archer: But surely the Minister would not equate the procedure under the detention of terrorists order with the normal working of the courts.

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    Since it seems that we may have that order with us for some little time, will he say how many interim custody orders have been made under that procedure, and how many detention orders?
    Mr. Howell: I certainly did not equate the two. My point was that they were distinct and different. The present number of those committed to interim custody is, I believe, six although I shall write to the hon. and learned Member if it is higher.
    Mr. McMaster: Is my hon. Friend not aware that the ordinary processes of law cannot operate in a situation of carefully planned and deliberate violence and intimidation? Magistrates have been attacked and shot and Crown witnesses have been killed. In those circumstances the ordinary processes of law cannot work.
    Mr. Howell: That is the difficulty about terrorist activity. But it must be recognised—and I am sure that my hon. Friend will welcome the development—that more and more people have shown themselves ready to come forward and give information or use the robot telephone, which has been very effective, thus providing evidence on which terrorists can be arrested.

    Aldergrove Airport (Approach Road)
    Mr. Molyneauxasked the Secretary of State for Northern Ireland if he will impose a speed limit on the approach road to Aldergrove Airport between Nutts corner and Antrim.
    Mr. Peter Mills: I am not aware of the need for a speed limit on the approach roads to Aldergrove Airport. If my hon. Friend will let me know his reasons for suggesting a speed limit on any particular stretch of road I will arrange for the matter to be investigated.
    Mr. Molyneaux: Will my hon. Friend bear in mind that there have been a number of fatal accidents on the trunk road leading east from the airport? I trust that this will not cause any great amusement on the Labour benches. In recent months speeds of 100 mph have been not uncommon, and the volume of traffic is increasing rapidly because of the five major roads feeding into the roundabout.
    Mr. Mills: More definite and precise information is required of the exact spot at which my hon. Friend would like the speed limit imposed. An important criterion is that a speed limit should be realistic and capable of being enforced, so we must know where the spot is and where the dangers are. I shall probably be travelling along this road a considerable number of times in the near future and I shall personally investigate for the hon. Member.

    Government Proposals (White Paper)
    Mr. McNamaraasked the Secretary of State for Northern Ireland when he intends to publish a White Paper of his proposals for constitutional arrangements in Northern Ireland.
    Mr. van Straubenzee: I would refer the hon. Member to the reply given to a Question by the hon. Member for Down, North (Mr. Kilfedder) on 9th November.—[Vol. 845, c. 224.]
    Mr. McNamara: Does the Minister of State not realise that the position is completely unsatisfactory? If the proposed Bill passes unamended people will be asked to take part in a poll without knowing what their future connection with the United Kingdom will be. Does he not think that before any decision is taken on the border poll Bill the people of Northern Ireland as a whole should know the Government's intentions for their country?
    Mr. van Straubenzee: The hon. Member will recall that in the debate on Monday the Government listened to a considerable cross-section of views. On this point, perhaps not unusually, they were conflicting. Those views are being considered carefully, and when the House is invited to consider the Bill the matter can be considered further.
    Mr. David James: Will my hon. Friend bear in mind the need for speed in the matter? I have found that the feeling on all sides is that there has been enough talk over the last seven months and that there would be great merit in the Government's making definite proposals at the earliest possible moment.
    Mr. van Straubenzee: That is what I attempted to say on Monday night, as my

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    hon. Friend will remember, consistent with carefully taking the views of a very wide cross-section of people—a process which is in part going on today.
    Mr. Douglas: Will the Minister concede that we must have the White Paper before the end of the year?
    Mr. van Straubenzee: These are matters best dealt with when next the House is invited to consider the Bill.
    Mr. Winterton: When the White Paper is published, will the Minister of State give an assurance to the people of Northern Ireland that their Westminster representation will be increased, because if we compare representation in this country—and Northern Ireland is a part of this country—their representation is grossly undemocratic.
    Mr. van Straubenzee: If I express a view either way upon that proposition, clearly I would be expressing a view upon a very central issue which must be dealt with by the White Paper. We must await the publication of that White Paper.

    Antrim—Lisburn Rail Link (Level Crossings)
    Mr. Molyneauxasked the Secretary of State for Northern Ireland whether he will introduce an automatic signalling system on the rail link between Antrim and Lisburn to warn users of level crossings of approaching trains.
    Mr. Peter Mills: No, Sir. The operation of the railways, including the installation of automatic signalling systems at crossings, is a matter for the Northern Ireland Railways Company. I understand that it considers that no crossings in this rail line will require automatic barriers and signals, even after the re-introduction of passenger services.
    Mr. Molyneaux: But is my hon. Friend aware that on that section between Lisburn and Antrim the line of sight is often less than 500 yards? Will he take steps to ensure that an efficient automatic system is installed, so that a signal is visible from any point on the line?
    Mr. Mills: I was not aware of the facts that my hon. Friend has presented. I understand that the line is being used only for freight trains, but that passenger services will be restored, and that when
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    that is done a telephone will be provided on each side of the crossing so that anyone wishing to cross may call the nearest signal box to check whether it is safe to do so. I believe that that will help considerably with what is a difficult problem, and one that could be unpleasant.

    Malicious Damage Acts
    Mr. Stratton Millsasked the Secretary of State for Northern Ireland if he will review the Malicious Damage Acts, with a view to seeking powers to extend coverage to categories of genuine loss which are not currently covered either by the Acts or by insurance.
    Mr. van Straubenzee: The Criminal Injury Acts (Northern Ireland) 1956–1970 provide a code of law designed specifically to deal with compensation for malicious damage to property. It would be inappropriate to extend that legislation to cover the diverse sources of loss which have arisen either directly or indirectly from unrest in Northern Ireland.
    Mr. Mills: Is my hon. Friend aware that hijacking of goods vehicles has become a major problem in Belfast, that it is happening every day and that whisky obtained by that illegal means is now being sold on the open market at £1 a bottle? Is he also aware that in such hijacking the contents of the vehicles are not covered by normal insurance, nor by the Malicious Damage Acts, which do not cover loss and theft? This is an unsatisfactory situation. Could it be looked at again?
    Mr. van Straubenzee: I am always very willing to look at such matters continuously, and to discuss them with my hon. Friend, but I know that with his long experience of the law he will understand that the kind of extension of the law that he requires would place a substantial financial burden upon the State.

  EDUCATION AND SCIENCE

    Universities (Qualified Applicants)
    Mr. Dalyellasked the Secretary of State for Education and Science what latest figures she has for the number of qualified applicants who have been refused university places.
    The Secretary of State for Education and Science (Mrs. Margaret Thatcher):
    The best and latest information available is contained in the Statistical Supplement to the Ninth Report of the Universities Central Council for Admissions, 1970–71. I am sending the hon. Member a copy.
    Mr. Dalyell: Having seen that, do the Government share the publicly-stated anxieties of the vice-chancellors about the future intakes of students, given the very real uncertainties that surround the quinquennium?
    Mrs. Thatcher: The vice-chancellors probably have differing views about the intakes. I hope before long to make an announcement about the quinquennium.
    Mr. Jessel: Is not it a myth that all qualified applicants can derive some benefit from attending university? Is not there quite a strong case for arguing that at least a modest minority of qualified applicants can obtain more satisfaction from going straight from school into some other occupation?
    Mrs. Thatcher: An increasing number of qualified applicants have been going to polytechnics and further education colleges. Some of them prefer to go out into the world first and then, perhaps, to go into the higher education system later.
    Mr. Moyle: Does the right hon. Lady agree that whatever figures she has for graduate unemployment they are no argument for reducing the Government's proposals for a higher education programme, because not enough is known about the circumstances of graduate unemployment?
    Mrs. Thatcher: I think that the hon. Gentleman will find when the quinquennium is announced that it provides for an increase in the number of university places.

    Direct Grant Schools
    Sir Gilbert Longdenasked the Secretary of State for Education and Science if she will reopen the list of direct grant schools; and if she will recapitulate her policy towards these schools.
    Mrs. Thatcher: I have not found it possible to reopen the list. My policy is to encourage the existing direct grant
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    schools, and I have done this by improving the arrangements for fee remission and the rate of capitation grant.
    Sir Gilbert Longden: I acknowledge the great help that my right hon. Friend has been to these admirable institutions, which are a bridge between the public sector and the private sector, but could not she reconsider her decision not to re-open the list?
    Mrs. Thatcher: I have never wholly closed my mind upon the matter, but it is a question of what can be done within the time available. I should like to reassure my hon. Friend that in due course I will certainly reconsider the question.
    Mr. Dormand: May I remind the right hon. Lady of the promise in the Gracious Speech to set new priorities in education? In implementing that promise, will she forget about any further privileges for the direct grant schools and concentrate on making greater provision in staffing, buildings, equipment—and almost everything else—in schools for the handicapped, where the situation is rapidly becoming a national scandal?
    Mrs. Thatcher: The direct grant schools perform an excellent service to the nation's children. I agree that the schools for the mentally and physically handicapped also do so, and we hope to improve the capital programme for them in the future, as in the past.
    Mr. Gurden: Will my right hon. Friend consider the matter very soon, because more places need to be provided in direct grant schools? In this connection I should like to refer to Oral Question No. 18, which was not asked, because there is great pressure in the areas that it mentions for more school places of every kind.
    Mrs. Thatcher: I cannot say when I shall reconsider the reopening of the direct grant list. We have done as much as we can to help such schools to take pupils, whatever their background, and in this connection have done a great deal through the incomes remission scale.

  DEFENCE

    Northern Ireland
    Mr. Duffyasked the Minister of State for Defence if he is satisfied with

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    the Army civilian arrest procedures currently employed in Northern Ireland; and if he will make a statement.
    The Minister of State for Defence, (Mr. Ian Gilmour): I have nothing to add to the reply by my right hon. Friend the then Minister of State for Defence, to a similar Question by the hon. Member on 22nd June.—[Vol. 839, c. 695–6.]
    Mr. Duffy: And yet the most disturbing allegations continue to be made about a minority of that very small number of British soldiers employed in civilian arrest procedures in Northern Ireland. When a distinguished and reputable newspaper like the Irish Times runs—as it did on 7th November—a story such as that under a headline like, "Man says soldier burnt"—
    Mr. Speaker: Order. There can be no quotation from a newspaper at Question Time.
    Mr. Duffy: When a newspaper like the Irish Times runs a story under a headline like, "Man says"—
    Mr. Speaker: Order. The hon. Gentleman must not quote either a headline or any part of a newspaper. I am sorry to have to take up time to remind him, but it is one of the old rules of the House that newspapers cannot be quoted from in Question Time.
    Mr. Duffy: With respect, Mr. Speaker, I was not aware that I had done that. I thought that I had deliberately paraphrased it.
    When a newspaper like the Irish Times runs such a story, does not the Minister think that all Members anxious to preserve the good name of the overwhelming majority of soldiers employed in operations in Northern Ireland are entitled to feel concerned?
    Mr. Gilmour: I am glad that the hon. Gentleman talked about preserving the good name of our soldiers in Northern Ireland. There is a campaign by extremist elements in Northern Ireland to discredit the armed forces. I am sure that the hon. Gentleman would not wish to say anything to support that campaign.
    Mr. Stratton Mills: Is my hon. Friend aware that there is always a series of complaints against people who wish only
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    to do their duty fairly and impartially? Will he pay particular attention to answering such allegations, which are bandied about particularly in the United States, and use our information services to answer these points?
    Mr. Gilmour: The answer to both parts of my hon. Friend's question is, "Yes", but we look into any allegations that are made.
    Mr. Peter Archer: I accept that it is easy to make such allegations, just as it is easy to ill-treat people who are undergoing interrogation, but will the Minister set everyone's mind at rest by investigating the matter?
    Mr. Gilmour: As the hon. and learned Gentleman knows, interrogation is not carried out by the armed forces.
    Mr. McMasterasked the Minister of State for Defence what is the total number of military casualties and deaths which have taken place in Northern Ireland as a result of the current terrorist campaign up to 24th March, 1972, and from 25th March, 1972, to date.
    The Under-Secretary of State for Defence for the Army (Mr. Peter Blaker):
    As a result of terrorist or other hostile actions, the Army, including the Ulster Defence Regiment, sustained 66 killed and 564 wounded between August, 1969, and 24th March, 1972; 98 have been killed and 409 wounded between 25th March and 15th November, 1972. Since this is my first appearance at this Dispatch Box I would like to pay a tribute to our forces, who have conducted themselves magnificently.
    Mr. McMaster: I thank my hon. Friend for that reply. Has he noticed that since the political initiative in March the rate of casualties in the Army has increased approximately fourfold? Will my hon. Friend say why, in his opinion, there has been this dramatic increase in the number of casualties since the political initiative was taken?
    Mr. Blaker: I think it is right to say that it has always been understood that the introduction of direct rule carried certain risks for the community and for our forces. But we believe that it was entirely right to accept these risks in order to bring about conditions in which political developments could take place, for

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    no purely military solution was or is possible. I draw my hon. Friend's attention to the present trend of military casualties. Over the past few months, the number of regular soldiers killed was 17 in August, 11 in September, five in October and two, so far, in November.
    Mr. Winterton: Bearing in mind the increased terrorist activity in the exposed county of Fermanagh, will my hon. Friend consider the use of helicopter patrols with fire power, which would reduce the military casualties in Northern Ireland?
    Mr. Blaker: All appropriate measures are considered, and I shall bear that suggestion in mind.

    Ulster Defence Regiment
    Mr. Loveridgeasked the Minister of State for Defence what further steps he is taking to maintain a balance in recruitment into the Ulster Defence Regiment between the different religions among the volunteers.
    Mr. Blaker: Recruiting in general has been good but we would like to see an improvement in the balance. We are continuing to do what we can to this end.
    Mr. Loveridge: I appreciate my hon. Friend's answer, but will he do his utmost to ensure that the balance of recruitment and the balance of retention are improved between the different religions in the Province, as this matter gives rise to great anxiety?
    Mr. Blaker: I accept entirely what my hon. Friend says. As I have already mentioned, we are considering all possible ways of improving the situation. It is doubtful whether anything spectacular can be done in the short run, but for the present our efforts to recruit more Roman Catholics are local in character, mainly through personal contact and the local work of battalion and company commanders. The UDR Advisory Council believes that at present this is the right line.
    Mr. Robert Hughes: Is the Minister aware of reports that UDR vehicles have been seen flying a red hand flag? If these reports have been investigated and
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    substantiated, what action has the Minister taken?
    Mr. Blaker: I shall investigate the position referred to by the hon. Gentleman.
    Mr. Pounder: Yesterday my hon. Friend was kind enough to give me some statistics of recent recruitment to the UDR. Does he not agree that there has been a marked falling off in applications to join this regiment from both communities in the last few months and an increase in the number of resignations? Will he do his best to accelerate recruitment?
    Mr. Blaker: I do not entirely accept what my hon. Friend says. Recruitment generally is going well. The cause for concern is the falling off in the level of recruitment from the Roman Catholic side.

    Departmental Staff
    Mr. Millanasked the Minister of State for Defence what is the total number of headquarters staff employed in his Department; and how many of them are located in development areas.
    Mr. Ian Gilmour: The total number of headquarters staff employed in the Ministry of Defence is approximately 20,800 of which some 3,100 are Service personnel. Less than 100 are located in the development areas.
    Mr. Millan: Is that not a scandalous state of affairs? Why should not a large number of these civil servants be located outside London, and especially in the development areas? Following the Hard-man Report, will the hon. Gentleman give a pledge that there will be a large-scale dispersal of Ministry of Defence personnel out of London and into the development areas?
    Mr. Gilmour: I do not think that it is a scandalous state of affairs. As the hon. Gentleman knows, quite a lot of headquarters staffs have been dispersed away from London, and the Ministry of Defence is taking part in a location of Government review which is now taking place. The review co-ordinator will be reporting by the end of the year.

  HOME DEPARTMENT

    European Au Pair Convention
    Dame Joan Vickersasked the Secretary of State for the Home Department when Her Majesty's Government is intending to sign the European Au Pair Convention.
    The Under-Secretary of State for the Home Department (Mr. David Lane):
    Not at present; but I shall continue to keep the position under review.
    Dame Joan Vickers: Has my hon. Friend considered that I first approached the previous Conservative Government, then the Socialist Government, and now the present Conservative Government about this? This has been going on for 12 years. What does my hon. Friend mean by "soon"? Does he mean the near future?
    Mr. Lane: I did not say "soon". I know my hon. Friend's great interest in this matter. We have genuine doubts whether the formal arrangements provided for in this agreement would in practice provide any effective additional protection for either party in these arrangements. Most of them work well on a voluntary basis and we should want a Jot of convincing that an agreement would improve things. However, I am willing to meet my hon. Friend again and discuss this matter, if she would like that.
    Sir G. de Freitas: As most of these girls trouble to learn English and French and the problem of protecting them is almost entirely a matter for the British and French Governments, will the Minister work with the French Government and discuss how these girls can be protected, and not constantly delay until the convention is accepted?
    Mr. Lane: There is no delaying about it. If it would help to have discussions with the French Government, we certainly shall, but in the vast majority of cases the arrangements work very well on an informal basis and we do not want to upset this without very good reason.

  POST-APOLLO PROGRAMME
  Mr. Dalyellasked the Prime Minister if he will discuss European participation in the post-Apollo programme during his next meeting with Chancellor Brandt.
  The Chancellor of the Exchequer (Mr. Anthony Barber): As my right hon. Friend the Prime Minister is in Northern Ireland, I have been asked to reply.
  The question of participation is being discussed with our partners in the European Space Conference. My right hon. Friend has at present no plans for separate discussions about participation in the post-Apollo programme.
  Mr. Dalyell: As we were confidently told by the science correspondent of The Times that we would have a parliamentary statement on Monday, will the Chancellor tell us the nature of the hitch in the ministerial talks?
  Mr. Barber: I am replying on behalf of the Prime Minister, not the science correspondent of The Times, but, as was clear from the answer which my hon. Friend the Minister for Aerospace gave on Monday, this was only an interim discussion and substantive decisions were not taken. In those circumstances, it was wholly appropriate that a written Answer should be given.
  Mr. Michael McNair-Wilson: Is my right hon. Friend aware that many of us are very appreciative of the efforts being made by my hon. Friend the Minister for Aerospace and Shipping to initiate an integrated European space programme and thus give some shape to the space effort of Western Europe?
  Mr. Barber: This is obviously a most important aspect, and the fact is that final decisions on the post-Apollo programme cannot be taken before the current discussions with our European partners have been concluded. But participation will ultimately depend on the extent to which arrangements can be made to rationalise European space expenditure.
  Mr. Benn: What would be the rough estimate of expenditure involved for Britain if we are to participate on the basis of the offer made by the United States within the context of a co-ordinated European response?
  Mr. Barber: I am afraid that at this stage I cannot give that information.

  CANADIAN PRIME MINISTER (VISIT)
  Mr. Adleyasked the Prime Minister if he will invite the Canadian Prime Minister to pay an official visit to Great Britain.
  Mr. Barber: I have been asked to reply.
  As the Prime Minister of Canada knows, my right hon. Friend is always ready to welcome him to this country for official talks.
  Mr. Adley: Bearing in mind that the Canadian Government have invited heads of Commonwealth countries to a possible Commonwealth conference in Canada next year, does my right hon. Friend agree that, as we are entering Europe, the British Government can now do a very important job in smoothing and improving the links and relationship between the Commonwealth and the European Economic Community? Secondly, in view of the recent election results in Canada, is there any possibility of the attitude of Prime Minister Trudeau towards NATO being softened somewhat?
  Mr. Barber: My hon. Friend is right, as I understand it, in that the Commonwealth Secretary-General, Mr. Arnold Smith, has suggested that a meeting of Heads of Government of the Commonwealth might take place next year. I understand that Mr. Arnold Smith is now exploring with the Heads of Government what dates are likely to be most convenient to them.
  On my hon. Friend's other point, this is something which my right hon. Friend dealt with in his speech at the Lord Mayor's banquet early this week, and it is well understood in Canada, as in other parts of the Commonwealth, that our entry to the EEC in no way indicates
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  any weakening of our interests in the countries of our friends in the Commonwealth. On the contrary, my discussions with Canadians have shown that our membership of the enlarged Community will strengthen the economy, and they recognise that this, in turn, will make us a stronger and more useful partner to our old friends.
  Sir Harmar Nicholls: Will my right hon. Friend bear in mind that, in view of the economic potential and the general feeling that is made clear when one goes to Canada, there is a special need for efforts to be made to re-establish the special relationship between this nation and Canada? Merely to give answers which suggest that Canada is not bitter towards us is not facing the need to take positive action to re-establish real understanding.
  Mr. Barber: I do not believe that that is a true reflection of the position. Ministers, business leaders and the Press in Canada have reacted favourably to the successful outcome of our negotiations with the EEC. However, I agree that it is of the utmost importance that we should maintain the strong and good relations which we have with Canada.
  Mr. Elystan Morgan: Will the right hon. Gentleman tell the House whether there is any good reason why the next Commonwealth Conference should not take place in Britain, thus endorsing our position of leadership within that family of nations?
  Mr. Barber: I think I am right in saying that the location of the Commonwealth Prime Ministers' Conference, just as the Commonwealth Finance Ministers' Conference, with which I am more familiar, is a matter for general discussion and agreement.
  Mr. Thorpe: Since the hon. Member for Peterborough (Sir Harmar Nicholls) appears to speak for the Liberal Government of Canada in saying that they are opposed to our entry into the EEC, may I ask whether the right hon. Gentleman is aware that political opinion in Canada fully understands the motives of both Labour and Conservative Governments in joining and, indeed, looks forward to an enlarged Community from which Canada will benefit?
  Mr. Barber: Yes, I believe that that is so. In fact, my right hon. Friend the Prime Minister received a very generous message from Mr. Trudeau on the occasion of the signing of the Treaty of Accession.

  GOVERNMENT OFFICES (DISPERSAL)
  Mr. Edward Taylorasked the Prime Minister when he expects to receive the report of the Hardman Committee on the dispersal of Government offices; and if he will make a statement.
  Mr. Barber: I have been asked to reply.
  As my right hon. Friend told the hon. Member for Sunderland, South (Mr. Bagier) on 24th October, recommendations will soon be submitted. The House will be fully informed of the Government's decisions.—[Vol. 843, c. 263–4.]
  Mr. Taylor: Has the Chancellor seen the latest official figures which show that the average rental for office accommodation for one civil servant in Central London is £1,050 per year, whereas similar accommodation in Glasgow and Edinburgh is £225? Will the Chancellor bear in mind these startling figures, as well as the need for employment, when considering the report?
  Mr. Barber: When we get the recommendations of the Committee, we will obviously bear all these factors in mind. The two main criteria which we shall have in mind in choosing locations will be efficiency and economy of operation, on the one hand, and certainly, as my hon. Friend suggested, the needs of the regions, on the other.
  Mr. Blenkinsop: Will the Chancellor tell us what is meant by "soon"? We have such phrases so often. Will he bear in mind particularly the need for Government offices and nationalised industry offices like the National Coal Board in the North-East?
  Mr. Barber: My right hon. Friend will obviously take note of what the hon. Gentleman has said. I realise that this committee is taking longer to report than many people had expected but it is important to recognise that the earlier dispersal initiative, which took place in 1963, was concerned with self-contained
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  executive work of little policy content and few contacts with Ministers, Parliament and outside bodies. This is a bigger operation, which accounts for the length of time it is taking.
  Mr. Kenneth Lewis: Is my right hon. Friend aware that many of the back-up operations behind the Civil Service at the top level could just as easily be done in the provinces? If many of these people went to the provinces they could send back messages to London which would enable the people at the top to have a better view of the attitude of ordinary people in the country as a whole, instead of just in the Metropolis.
  Mr. Barber: I take note of my hon. Friend's first point. On his second point, as a Yorkshireman, I can certainly say that he is absolutely right.
  Mr. Arthur Davidson: May I recommend to the Chancellor the area of North-East Lancashire which, on all the grounds that he has elaborated, stands out like a beacon? It is efficient, and there is a need in the region.
  Mr. Barber: Certainly.

  UNITED STATES OF AMERICA (VISIT)
  Mr. Douglasasked the Prime Minister if he will seek to pay an early official visit to the United States of America.
  Mr. Barber: I have been asked to reply.
  My right hon. Friend has at present made no arrangements to visit the United States of America.
  Mr. Douglas: When the Prime Minister decides to visit the United States, will he undertake to raise with President Nixon a narrow but important issue—namely, why the United States Government have decided to subsidise their shipbuilding industry in the production of liquified natural gas carriers to the tune of 25 per cent. and why British companies, particularly Scottish-registered oil companies, seek to have these ships built in the United States rather than in the United Kingdom?
  Mr. Barber: I will draw my right hon. Friend's attention to what the hon. Gentleman has said.
  Mr. Evelyn King: If the Prime Minister visits America, could it be made clear to American opinion that the anti-Nixon prejudice shown by the British Broadcasting Corporation is a little resented over here and does not reflect any respectable body of British opinion, which has a high regard for both the office of President and its present incumbent?
  Mr. Barber: I think that most people in this country would support my right hon. Friend the Prime Minister in the message of congratulation that he sent to President Nixon on his victory.
  Mr. Robert Hughes: If the Prime Minister goes to America, will he make it plain that many people in this country regard President Nixon's cruel hoax over peace in Vietnam as an absolute disgrace? Will he also convey to the American President that we in this country feel that peace in Vietnam should be signed as soon as possible and an end put to this dreadful war?
  Mr. Barber: President Nixon has made it absolutely clear that the United States want a peace that will last; but he has insisted that before an agreement—I quote his words—
  "The central points be clearly settled so that there will be no misunderstandings which could lead to a breakdown of the settlement and a resumption of the war."
  The British Government fully support this approach, which is wholly reasonable.
  Sir Gilbert Longden: When the Prime Minister visits America, will he make it clear to the President that our joining Europe implies no weakening, but rather a strengthening, of the Atlantic Alliance—which alliance is as much in the interests of America and Canada as of Europe?
  Mr. Barber: I know that the Leader of the Opposition will bear me out when I say that successive Administrations in the United States have consistently supported our application to join the EEC.

  INFLATION
  Miss Joan Hallasked the Prime Minister whether he will make a statement on developments in the Government policy towards inflation, in the light of recent talks between himself and representatives of the Confederation of British Industry and the Trades Union Congress.
  Mr. Barber: I have been asked to reply.
  I would refer my hon. Friend to my right hon. Friend's statement on 6th November.—[Vol. 845, c. 622–37.]
  Miss Hall: Will the Chancellor confirm or deny that talks will continue between the Government, the TUC and the CBI on the monitoring of both wages and prices over the next few months?
  Mr. Barber: My right hon. Friend made it quite clear, both at the time the talks ended and publicly since, that he would welcome the opportunity of further talks to deal with this whole situation.
  Mr. Frederick Lee: As the Chancellor told the Tory Conference at Blackpool a few weeks ago that there had been no inflation under the Conservative Government, may I ask what these talks are about?
  Mr. Barber: What I said at the Conservative Conference, which was a very successful conference, was that during the first year of our period in office after January, 1970—what I call the hang-over period—prices had risen by 10 per cent., and we had been remarkably successful in cutting the rise in prices by almost half-during the second year. I believe that the whole country is now behind the policy announced by my right hon. Friend the Prime Minister. What is more, the country will have no sympathy with anyone who tries to undermine that policy.
  Mr. McCrindle: When the Government consider the next stage of the incomes policy, will they consider afresh the desirability of linking wage increases to increases in the cost of living rather than percentage norms?
  Mr. Barber: We put forward a proposal, first in the NEDC many months ago and then by my right hon. Friend the Prime Minister in the tripartite talks, that there should be threshold agreements, which would, of course, have provided very considerable protection for individuals against rises in the cost of living above a certain point. I hope that that aspect will be considered again when the talks resume, as I hope they will.
  Mr. Ashton: Will the right hon. Gentleman tell us whether it was part of his plan to get support for the freeze by bringing forward the £10 bonus to pensioners to the same day as two by-elections? Will he confirm that that is the reason for the sudden rush to get these two by-elections over?
  Hon. Members: Lincoln!
  Mr. Barber: As a result of action by the Government, and thanks also to the administration, officials and staff of the Post Office and the Department of Health and Social Security, we were able to bring forward the date of payment to the earliest date possible. As far as the by-elections are concerned, I think the hon. Gentleman has had his answer. It is "Lincoln".

BUSINESS OF THE HOUSE
Mr. Harold Wilson: May I ask the Leader of the House whether he will kindly intimate the likely course of Government business next week?
The Lord President of the Council and Leader of the House of Commons (Mr. James Prior)Yes, Sir.
The business for next week will be as follows:
MONDAY, 20TH NOVEMBER—Remaining stages of the Counter-Inflation (Temporary Provisions) Bill.
Second Reading of the Pensioners and Family Income Supplement Payments Bill.
Motions on the Mink (Keeping) and the Coypus (Keeping) Orders.
TUESDAY, 21ST NOVEMBER—Second Reading of the Northern Ireland (Border Poll) Bill.
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Remaining stages of the Northern Ireland (Financial Provisions) Bill.
Motions on the Building Regulations (Northern Ireland) Order.
WEDNESDAY, 22ND NOVEMBER—Remaining stages of the Pensioners and Family Income Supplement Payments Bill.
Motions relating to the Immigration Rules for Control on Entry and Control After Entry.
Motion on the European Communities (Designation) Order, and Motions relating to the European Communities Orders.
THURSDAY, 23RD NOVEMBER—Remaining stages of the Northern Ireland (Border Poll) Bill.
Motion on the Appropriation No. 3 (Northern Ireland) Order.
FRIDAY, 24TH NOVEMBER—Private Members' Motions.
MONDAY, 27TH NOVEMBER—Second Reading of the Land Compensation Bill.
Mr. Speaker, it may be convenient for me to inform the House that at the beginning of business on Monday, 20th November, my right hon. Friend the Prime Minister proposes to move for an Address of Congratulations on the occasion of the Silver Wedding of Her Majesty The Queen and His Royal Highness the Duke of Edinburgh.
Mr. Wilson: First, when is the long-awaited statement on the steel industry to be made? Secondly, will the Government find time for an early debate on the Robens Report on Industrial Safety and Health? Thirdly, is the right hon. Gentleman in a position to say when the foreign affairs debate, postponed from the debate on the Address, is to take place? Fourth, when will he find time to debate the Early Day Motion standing in the name of my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) and the names of many other right hon. and hon. Members, on the plight of the thalidomide children?
[That this House, recognising the problems which confront children handicapped as a result of their mothers' use of thalidomide, calls upon Distillers (Bio-chemicals) Limited in dealing with these cases, to face up to their moral responsibilities; and urges the Government to

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propose amending the law for damages to take account of actuarial considerations, and to consider a state insurance scheme to compensate for personal injury.]
Finally, we understand that the Army, Navy and Air Force discipline Acts Continuation Order, 1972, is to be introduced in another place before it comes here. Does the right hon. Gentleman recall the assurance given last year, when there was great feeling about such a measure being introduced in another place? It was regarded as a constitutional issue and we were given to understand that such a Bill and Motions in future would start in this House, since they are of constitutional significance. Will he examine this again in order to ensure that the order gets its introduction into this House first on the affirmative resolution procedure?
Mr. Prior: My right hon. Friend the Secretary of State for Trade and Industry is well aware of the anxiety in all the steel-making areas of the United Kingdom likely to be affected by the long-term development plans of the British Steel Corporation. He is studying its proposals. The final proposals were received only early in October. The Government's decision will be announced to Parliament as soon as possible. I know that there is very strong feeling in the House on this matter and I will ask my right hon. Friend to make a statement as soon as he can.
The right hon. Gentleman asked when we are to have a foreign affairs debate. The position is very much as I stated it to him last week. We know that we have to have a debate in the near future but it will be difficult to arrange it in the next fortnight.
Thirdly, the right hon. Gentleman raised the question of procedure under the Army, Air Force and Navy discipline Acts. As I understand it, when the Acts were before the House, we gave an undertaking that in future such measures would be introduced into this House first, but the orders which are required for years three to five are not necessarily introduced into this House first. Indeed, I believe that in 1967–68 they were introduced into another place before coming here. But in view of what the right hon. Gentleman said, I will, of course, have a fresh look at the situation.
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I do not, however, think that there is any particular difficulty in it.
As for the Robens Report, I gather that there is to be a debate on the Adjournment this evening. I assume, therefore, that right hon. and hon. Members opposite will provide an early opportunity to debate the issues in their Early Day Motion. That debate, I think, applies particularly to the question of the thalidomide victims. I hope that the Opposition will choose an early Supply Day for that purpose.
Mr. Wilson: The right hon. Gentleman was not quite clear at the end of his reply. I am not sure that the House clearly understood what he tried to say. He was mixing the debate on thalidomide children with the debate on the Robens Report. Will he clarify the position? Surely he is not expecting us to provide time on Supply Days either for the Robens debate, which is clearly Government business, or for the Early Day Motion on thalidomide children? If the Government are going to drag their feet on the Motion about thalidomide children, we can, of course, turn it into a Motion of censure.
Mr. Prior: I do not think that it would be unreasonable to ask the Opposition to provide time for a debate on the thalidomide children. Right hon. and hon. Members have ample opportunities for raising this matter, and I would have thought that after the Adjournment debate has taken place tonight, it would be reasonable for that Motion to be debated by means of a Supply Day.
I am sorry if I mixed up the report of the Robens Committee with the question of a debate on the thalidomide children. In due course there may well have to be a debate on the Robens Report, but we are very pressed at this time of the year, wishing to get on with Second reading debates of Bills. I cannot, I am afraid, promise anything in the immediate future.
Mr. Edward Taylor: Can my right hon. Friend at least give an assurance that the statement on the future of the steel industry will be made before 1st January, which is a very significant date for the future of the industry?
Mr. Prior: I give that undertaking now.
Mr. George Thomas: Has the right hon. Gentleman given further consideration to the question of a debate on Welsh affairs? Is he aware that Wales is entitled to a better deal than she is getting in this House and that it is high time that our problems were discussed on the Floor of the House?
Mr. Prior: Following our exchanges last week, I have given this question of a debate on Wales on the Floor of the House further consideration. I must tell the right hon. Gentleman, however, that I cannot at the moment see any time available for it. I am glad that the Welsh Grand Committee is to have an extended sitting next week to debate the National Health Service in Wales. I recognise that the right hon. Gentleman and all his Welsh colleagues on both sides of the House would like an early debate on the Floor of the House. I will do what I can, but I cannot make a promise at this stage.
Mr. Hayhoe: Will my right hon. Friend give an assurance that the Motions to be discussed on the Immigration Rules next Wednesday will be drawn widely enough to enable matters such as the somewhat alarming article in the Daily Express this morning to be adequately ventilated in this House?
Mr. Prior: Yes, I can give my hon. Friend the undertaking for which he asks, namely that this subject will be in order in the debate next Wednesday. I think that many of us felt that the article which appeared in the Daily Express this morning went a good deal further than representing the actual facts on the Immigration Rules. Perhaps I should make it plain that the Immigration Rules and the changes made in the position of Commonwealth citizens relate only to admission in terms of long-term employment. These people will always be welcome here as visitors and students and for working holidays on exactly the same terms as before, and they will retain the same status and privileges in our law.
Mr. Robert C. Brown: What steps does the Prime Minister or the Foreign Secretary intend to take to end the shamefully inhuman treatment of my constituent, Mrs. Linda Desramault, by seeking speedily to bring to an end the indecent to-ing and fro-ing in other courts and
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quickly to get a custody decision about baby Caroline?
Mr. Prior: The whole House sympathises with the plight of the hon. Gentleman's constituent, and I will see that my right hon. Friend the Prime Minister is informed of the hon. Gentleman's views.
Dame Joan Vickers: Will the right hon. Gentleman look into the matter of the procedure in respect of Parliamentary Questions? Does he realise that Wales comes top of the list for Answers on three occasions, then comes Post and Telecommunications with a further three opportunities for Answers, and that we are to have Defence Questions only once before Christmas? Furthermore, will the Prime Minister give any indication when we are likely to have a Navy Minister, and is this the reason why certain orders are being taken in the other place?
Mr. Prior: The subject of Parliamentary Questions is a matter which is constantly being discussed in this Chamber, and whatever changes are made will always upset somebody. On the question of the appointment of a Navy Minister, this is a matter for my right hon. Friend and I will inform him of my hon. Friend's views.
Mr. Strauss: Will the right hon. Gentleman say what action he intends to take to implement the decision of the Privileges Committee, reported to the House on 20th June, concerning the style and status of the hon. Member for Berwick-upon-Tweed (Lord Lambton), a recommendation which was unanimously agreed?
Mr. Prior: I have been in my present job for about a fortnight, and I should like a little more time before giving the right hon. Gentleman an answer to his question.
Mr. Kilfedder: May I draw my right hon. Friend's attention to Early Day Motion No. 47 which calls on the Government to urge the Belfast shipyard, which is heavily financed by taxpayers' money, to purchase a computer from ICL which is dependent on Government support? Since the shipyard will shortly be making a public announcement about the matter, will be urgently consider providing time to debate this subject—a matter which is not only important to

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ICL but equally important to a factory in my constituency?
[This House calls upon the Government to urge Harland and Wolff, Belfast, which has already received £22 million of state aid and is to receive up to £49 millions more, to purchase a computer manufactured by International Computers Limited, in which the Government has invested the taxpayers' money and which would provide work for International Engineering Limited, Belfast, in which the Government has a majority shareholding.]
Mr. Prior: I am sure my hon. Friend will agree in all fairness that we are devoting a great deal of time in the next week to Northern Irish affairs, and I would not necessarily think that the subject he has mentioned would be out of order in tomorrow's debate. I would add that it is Government policy to encourage the purchase of British computers in the public sector.
Mr. Loughlin: May I draw the right hon. Gentleman's attention to Early Day Motion No. 19, which stands in my name and in the names of many hon. Members, on the need for psychiatric treatment rather than a prison sentence for women who have been found guilty of baby-snatching? Will he recognise that there have already been two tragic cases, one involving Pauline Jones and the other Jacqueline Paddon? Since there is another case pending, will the right hon. Gentleman try to let the House have a debate on this subject?
[That this House, conscious that' baby-snatching ' normally arises from mental maladjustment of the person concerned, urges upon the Home Secretary the need to submit proposals for legislation to ensure that those charged and proven guilty of such an offence shall not be subject to a prison sentence but shall be detained for psychiatric treatment.]
Mr. Prior: I regret that at the moment I cannot find any time for a debate on this matter, but it would seem to be a useful subject for a Private Member's Motion.
Mr. Marten: May we have an assurance that before the Minister for Transport Industries goes to Brussels to continue his negotiations about heavy lorries this House will have a debate on this
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subject in Government time so that the Minister will be able to express his view to the House? May I remind my right hon. Friend that we were given assurances by the Government that we would be able to debate these matters when they were in draft and before they were completed by the Council of Ministers.
Mr. Prior: I have nothing to add to what my right hon. Friend said yesterday.
Mrs. Renée Short: Did the right hon. Gentleman see the reply given to me last Monday by the Secretary of State for Social Services in answer to a Question asking when the departmental reply to the report of the Expenditure Committee on Private Practice was likely to be received? Is he aware that this report has been before the House for almost eight months and that it is a scandal that we have not been given a reply by the Government? Will he tell his right hon. Friend to get on with it and to see that the House has a reply next week?
Mr. Prior: I will, of course, inform my right hon. Friend of the hon. Lady's views.
Mr. Adam Butler: In view of the worldwide concern about possible inadequacies in fuel supply in the 1980s, will my right hon. Friend give time for an early debate on energy, preferably one in which the Government can put forward their proposals?
Mr. Prior: This is obviously a very important subject which we would wish to find time to debate in the House, but I cannot promise an early debate since we are faced with a log-jam of business over the next few weeks.
Mr. Concannon: When are we to have the oft-promised and oft-postponed coal mines Bill before the House? I can assure the right hon. Gentleman that all those from the highest boardroom level to the lowest apprentice in the industry feel that there has been bad faith by the Government in handling these matters.
Mr. Prior: I assure the hon. Gentleman that a Bill will be introduced quite soon. I can give him the further assurance that there is no question of bad faith. We know that a Bill must be introduced, and it will be, but we are not quite ready for it yet.
Mr. Raison: Will my right hon. Friend find time for a two-day debate on the next stage of the counter-inflation policy before the Government come forward with their proposals?
Mr. Prior: This is a matter of great concern to the House and I should like to consider my hon. Friend's suggestion further. The idea of a two-day debate on anything at the moment fills me with a certain amount of despondency.
Dr. Dickson Mabon: Is the right hon. Gentleman aware that there is a strong feeling among Scottish Labour Members that the next business of the Select Committee on Scottish Affairs should be North Sea oil? Will he give some consideration to this matter? Secondly, reverting to the subject of thalidomide, will he not look at this matter again? Since the matter is of interest to Members in all parts of the House, it is surely not a matter whether a debate should be in Government time or in Opposition time but that it should be in House of Commons' time.
Mr. Prior: I must point out to the hon. Gentleman that a Motion very similar in character on this subject has been tabled by the Leader of the Opposition, and therefore I did not regard it as unreasonable to suggest that they might be prepared to give time for a debate of this nature. I recognise that there is another Motion in the name of many hon. Members on both sides of the House, and the Government have taken note of that point. I hope that we shall be able to have a debate before very long.
Sir Gilbert Longden: Reverting to the last question and an earlier one, if the Government are contemplating interfering with judicial processes will my right hon. Friend bear in mind that there are objects much more worthy of our consideration than the Desramault imbroglio, namely, the thalidomide children?
Mr. Prior: My hon. Friend has shown clearly how difficult these matters can be.
I noted what the hon. Member for Greenock (Dr. Dickson Mabon) said about the Select Committee. A report is due shortly on the subject which he mentioned, and I should like to give attention to that before getting in touch with the hon. Gentleman further.
Mr. Edward Short: Do I understand the Leader of the House to say that the
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Government are refusing to give time for a debate on an official Motion put down by my right hon. Friend the Leader of the Opposition? If he is saying that, it is something new, and it provides a further example of the contempt with which that Government are treating the House.
Mr. Prior: I have said nothing of the sort. I said that there were two Motions on this subject on the Order Paper which were very similar in character, one in the names of hon. Members on both sides of the House and the other in the names of the Leader of the Opposition and some of his right hon. Friends. That being so, it seemed to me not unreasonable that, as the Opposition had tabled the Motion, they should use some of their own time during which to discuss it. From my experience of the House, I do not think that there is anything unusual in that suggestion.
Mr. Grylls: Will my right hon. Friend reconsider the answer which he gave last week about setting up a Select Committee on Overseas Aid? Is he aware that there would be no difficulty in manning this Committee from right hon. and hon. Members on both sides who are deeply interested in the subject? Is he also aware that there are now 192 signatures to Early Day Motion No. 1?
[That this House urges Her Majesty's Government to reconsider its view as set out in its Green Paper on Select Committees of the House of Commons published in October, 1970, and to recommend to the House that a Select Committee on Overseas Development be established, whose functions would include the review and appraisal of British performance in relation to the International Development Strategy for the Second United Nations Development Decade.]
Mr. Prior: I am aware of the strong feelings on this issue which exist on both sides of the House. I am equally aware that some of my hon. Friends considered that my reply last week was unsympathetic. Although I do not wish to appear unsympathetic, I can add nothing to what I said at that time, except that I am reconsidering the matter.
Mr. Elystan Morgan: Does the Leader of the House appreciate that many of us on this side, and possibly many hon. Members opposite also, are disappointed

621
at the cavalier attitude that he has adopted to the possibility of a debate on Welsh affairs, in view of the fact that there are deep and complex problems facing Wales which are worthy of the attention of the House? Will the right hon. Gentleman accept that such intransigence ill-becomes a new incumbent?
Mr. Prior: The hon. Gentleman is being a little unfair. He must know of the immense demands that are currently being made for time, not only by the Government but by others. The Government recognise that there should be a debate on Wales at the earliest possible opportunity. I said only that time cannot be found for such a debate at present.
Mr. Bruce-Gardyne: On a point of order, Mr. Speaker. I had always understood that it was the tradition of the House that hon. Members were allowed to ask only one business question. As the
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hon. Member for Greenock (Dr. Dickson Mabon) asked two questions, I submit that my hon. Friends and I should be granted extra questions.
Mr. Speaker: That is not a point of order. It is a matter for the discretion of the Chair.

BILL PRESENTED
  PENSIONERS AND FAMILY INCOME SUPPLEMENT PAYMENTS
  Secretary Sir Keith Joseph, supported by Mr. Chancellor of the Exchequer, Mr. Secretary Whitelaw, Mr. Secretary Campbell, Mr. Secretary Peter Thomas, Mr. Michael Alison, and Mr. Paul Dean presented a Bill to make provision for payments to pensioners and further provision with respect to family income supplements; and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 12.]
ORDERS OF THE DAY

  COUNTER-INFLATION (TEMPORARY PROVISIONS) BILL
  [3RD ALLOTTED DAY]
  Further considered in Committee [Progress, 15th November.]
  [Sir ROBERT GRANT-FERRIS in the Chair]
  Dr. J. Dickson Mabon: On a point of order. You may recall, Sir Robert, that during the two previous debates yesterday concerning the grouping of amendments some of us objected to the procedure of the Minister in seeking to reply after the first speech. My point of order concerns the amendments which were not touched on at all in any of the speeches. As it is obvious that at our present pace we shall not reach the Question, That Clause 2 stand part of the Bill, under the guillotine, I ask you to use your good offices to see that the amendments included in yesterday's debate, especially Amendment No. 73, receive some definite comment from the Minister before we reach seven o'clock and the end of our discussion on Clause 2. I refer specifically to the question whether under Clause 2 seasonal bonuses will be allowed to be paid.
  The Chairman: I think that what the hon. Member for Greenock (Dr. Dickson Mabon) is seeking as he or any other hon. Member is entitled to do, is to raise those matters in the debate on the Clause. In the event of any hon. Member raising such matters, the Minister will reply if he deems fit. Having raised this matter now, the hon. Member has given notice to the Government of his wish, and I can only say that I hope that it has not fallen on deaf ears.

  '(1) The following provisions of this section shall have effect for as long as section of this Act is in force.

  (2) No local housing authority shall offer for sale any residential accommodation at a price higher than that last fixed by the district valuer for the sale of like accommodation within the same area before 6th November 1972'.

  Sub-amendment (a), in new Clause 1, line 3, leave out from 'accommodation' to end of line 5.
  Mr. Pardoe: Inevitably the debate will range more widely than subjects concerning Amendment No. 83 only. Amend-

  COUNTER-INFLATION (TEMPORARY PROVISIONS) BILL
    Clause 2

      PRICES, PAY, DIVIDENDS AND RENTS
      Mr. John Pardoe: I beg to move Amendment No. 83, in page 2, line 12, leave out subsection (4) and insert:
      '(4) A landlord or housing authority shall not demand rent which exceeds the rent paid for the same property before 6th November 1972'.
      The Chairman: With this amendment we are to take the following amendments:
      No. 22, in page 2, line 12, leave out 'may' and insert 'shall'.
      No. 6, in page 2, line 13, after first 'rent', insert 'including the rent of unregulated tenancies'.
      No. 44, in page 2, line 13, after first 'rent', insert 'including the rent of houses built for letting by private landlords with public subsidy under the Housing (Financial Provisions) Act 1924'.
      No. 7, in page 2, line 13, leave out '6th November' and insert '1st October'.
      No. 98, in page 2, line 14, at end insert 'and for preventing increases in the price of land, including all buildings and dwellings, over the price payable before 6th November 1972'.
      No. 8, in page 2, line 16, after 'goods', insert 'or land'.
      No. 9, in page 2, line 16, after 'goods', insert 'land and dwellings'.
      No. 11, in page 2, line 19, after 'business', insert 'and including service charges in residential properties'.
      No. 13, in page 2, line 28, after 'goods', insert 'or land'.
      New Clause 1—(Sale of local authority houses)—
      ment No. 6 also deals with the rents of unregulated tenancies and other amendments, particularly Nos. 98, 8, 9 and 13, deal with the price of land and houses.
      I should perhaps say a brief word about the difference between our amendment

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      and Amendment No. 7, which is the Opposition amendment seeking to alter the date 5th November to 1st October. We agree with that amendment, but it was fortuitous for the Government that the Downing Street talks did not reach their climax early enough for the freeze to catch the increase in local authority rents on 1st October under the Housing Finance Act. Nevertheless that increase on 1st October makes absolute nonsense of the freeze and of the so-called Counter-Inflation Bill, because that increase of rents in local authority housing on 1st October is and will remain a major factor in inflation. It exerts pressure on land and house purchase prices and it exerts upward pressure on incomes.
      I recognise immediately the importance of Amendment No. 7 and we support the principle enshrined in it. But I do not wish to cloud the issue of the extension or non-extension of the freeze to rents. In our amendment we ask for a clear and straightforward answer from the Government, if the Government are capable of giving any straightforward answers on the Bill, whether they consider that the Bill does or does not freeze rents. The Government's replies in the debates during the past four weeks before we settled down to the Committee stage, have been exceedingly vague. The Bill itself is extraordinarily vague.
      Subsection (4), which we seek to delete and replace, says:
      "The appropriate Minister may by order provide for preventing increases of rent over rent payable before 6th November 1972".
      Many hon. Members on all sides of the House have grave reservations about the exercise of ministerial discretion. We seem fated to have to introduce more and more ministerial discretion into recent legislation. That is not a new move. The Labour Government's prices and incomes legislation was riddled with ministerial discretion. In general I am opposed to legislation which is so imprecise or uncertain in its effects that it requires such a wide degree of ministerial discretion to make it work.
      The kind of ministerial discretion laid down in subsection (4) allows the Minister to run away all too easily from the real problems of inflation, to make value judgments and party political judgments. I believe that they undermine the whole nature of the freeze. This provision
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      allows him to pick and choose between one rent increase and another. Why not ban all rent increases and say so in the Bill? If there is to be a freeze of rents, then let us have a freeze and let everybody know that it is one.
      This is the first major difference between our amendments and the wording of the Government's subsection. I claim that our amendment is legislation and theirs is an apology for inaction. Our amendment would ensure that something will be done about rent increases, whereas the Government's drafting says that something may be done, if the spirit is willing and the Minister is tough enough. In this respect there is a gulf between the Bill and the White Paper.
      In paragraph 22 of the White Paper it says that those tenants of private unfurnished accommodation who are at present subject to rent control and who will move from control to regulation on 1st January, 1973, will have this date postponed until after the freeze. That is something to be thankful for. We are told later in the same paragraph of the White Paper that the fair rents of private tenants will be frozen until the end of the freeze.
      Paragraph 23 goes slightly further and says that the rents of business premises and land will also be frozen. If one studies the Bill to find where this is enshrined one finds it does not exist. It will presumably be done by order, but the Bill does not say it will be done. It says it may be done, which is very different. How are we to know what the Minister may do? If the Government reply that the Minister will do what the White Paper says he will do, there are many members of the Opposition who will be cynical about the Government doing what they promised. Moreover, even if all the promises in the White Paper were honoured in legislation, I maintain they would fall far short of an effective freeze policy applying to the cost of housing.
      Surely the importance of rents in the control of inflation cannot be denied. However, there have been some extraordinary omissions on rent policy and the control of rents in recent debates. In the debate on the Address on 2nd November the then Secretary of State managed not to mention rents once in his opening

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      speech which was a remarkable feat, though perhaps wise in the circumstances.
      When the Chancellor of the Exchequer moved the Second Reading of this Bill on 8th November, he again omitted to mention rents. In spite of the blistering attack which was mounted by the right hon. Member for Grimsby (Mr. Crosland) on the Government's rent policy during the debate on the Address, we did not have a reply by the Minister then, nor did we have a reply from the Minister for Trade and Consumer Affairs when he wound up the debate on the Second Reading of this Bill. That is astonishing, because the Government seem to be saying and seem to believe that rents are an also-ran in the battle against inflation. We do not believe they are an also-ran; we believe that they are the essence of the whole policy. This omission is not new in prices and incomes legislation.
      Similarly, the Labour Government's White Papers of February and April, 1965, did not refer to rents. Indeed, not until the penultimate paragraph of the second White Paper is one able to find a reference to the incomes of landlords which, I suppose, is one way of referring to rents.
      Mr. Raymond Gower: In posing these problems, which are serious, would the hon. Gentleman tell the Committee what he would do about the rebates due to numerous tenants throughout the country? That is plainly a complicating factor in some rents.
      Mr. Pardoe: I am sure that it is a complicating factor that the Government would like to drag across the scene, but I do not think that it is complicating. However, I shall be dealing with that matter later.
      I should like to stress my first argument that rents are immensely important in the battle against inflation, and a glance at the 1971 family expenditure table, for instance, shows how important housing costs are. They amount on average to 12·8 per cent, of total household expenditure, but the percentage is much higher among the lower income groups. The percentage goes up to 19 and 20 per cent, at the bottom end of the scale. Housing costs are second only to food and transport as items of household expenditure.
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      The hon. Member for Barry (Mr. Gower) mentioned increases in council house rents. The then Minister of Housing, in answer to a Question, said:
      "… our first broad assessment of the average increase in rent likely to be paid by all council tenants in 1972–73 is about 35p."—[OFFICIAL REPORT, 18th October, 1972; Vol. 843, c. 249.]
      One cannot separate this forecast, which works out at about a 14 per cent, increase, from the forecast made by the Prime Minister in his letter to the Leader of the Opposition on 31st July, 1972. He said:
      "… any national average figure must be very uncertain and perhaps misleading. However, the best estimate we have been able to make is that over the next 12 months the net average effect of the two Bills might be to increase total rents in Great Britain by about 7½ per cent."
      Many of us felt then that that was a gross underestimate. It is clear now that certainly council house rents will rise this year by 14 per cent, and, even if the Minister was right on 2nd November to forecast that the increase next year would be 25p, or 8 per cent.—I doubt that he was right—one cannot just wash away an increase of 8 per cent. in so important an item of household expenditure and say that we do not have to worry about it.
      The figures from Shelter—I am indebted, as we all are, to the work done by Shelter, and especially for its array of figures—cast extreme doubt on the estimates by the Prime Minister and the then Minister of Housing. An official of the Department of the Environment, speaking at a National Federation of Housing Societies conference in Warwick in September, estimated that fair rent registrations would increase by 10 per cent. a year over the next 10 years, a fairly alarming forecast.
      Shelter considers that current registrations in the London area are up by 10 per cent. on last year, and in some places much more. For instance, in Coventry they are up by 20 per cent. In January, 1972, 43 per cent. of all families coming to Shelter for help were paying more than £6 a week in rent. By September, 1972, 85 per cent. of all families coming to Shelter for help were paying rents of £6 and more. That is a shattering increase in only a few months.

      629
      In face of those figures, the Government cannot excuse inaction by saying, as does the White Paper, that council house tenants are covered by rebate schemes. The rebate may be available for some—this is the reply to the hon. Gentleman—but it is a rebate on an already sharply increased rent as of" October last and, rebate or not, inflation has already taken place in this important expenditure sector.
      I should like to take one example which ties in closely with the sort of examples on housing which I get in my constituency. Let us consider a couple with one child and with an income of about £24. The unrebated rent rose on 1st October from £2 to £3. These may sound astonishingly low rent figures to some Members from the South-East, though in other places this is not so true.
      Mr. Ted Rowlands: Plus rates?
      Mr. Pardoe: This is unrebated rent—gross.
      The rebate was 69p; so the rebated rent is now £2·31 which is an increase of 31p on the September rent that they were paying. If the rent were to rise by 50p in April, as it will, and the rebate were to go up to 99p, they would pay a rebated rent, with the full effects of the rebate thrown in, of £2·51.
      Mr. Frank Allaun: Plus rates?
      Mr. Pardoe: Yes, plus rates, which are going up by 25 per cent. or so. This means that the rent has risen by 51p on a rent of £2 in six months, which is an increase of 25 per cent. This answers the Government's point in the White Paper that the whole local government housing sector is all right because it is covered by rebates.
      The Minister for Housing and Construction (Mr. Paul Channon): Is the hon. Gentleman saying that this rent rose in October and is due to rise again next April? I do not follow that.
      Mr. Pardoe: This is a total increase over six months.
      Mr. Channon: I am sorry, but I am confused and there may be confusion among other hon. Members. Is the hon. Member saying that this local authority
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      is putting its rents up both in October and next April? I do not understand that.
      Mr. Pardoe: No, it is a rent increase over the whole period of 51p on the rebated rent; this is still an increase of 25 per cent. Whether it is over six months or a year, it is still an alarming increase. It may well be that the period will eventually be 12 months, but this is the figure which I have been given by a local authority and these are the calculations which the authority is making. The authority has to bear the burden and I can only accept its figure.
      In a reply to the debate on the Address on 2nd November, the Minister for Housing and Construction tried to show why it was impossible—and he was challenged by some of my hon. Friends—to fix a ceiling of, say, 5 per cent. on rent increases. Although we have a different Minister now, presumably the arguments will be the same. The Minister said that the variations in rent up and down the country were enormous. He then said this:
      "it is not easy to achieve equitably a percentage ceiling on rents."—[OFFICIAL REPORT, 2nd November, 1972; Vol. 845, c. 470.]
      I do not accept any of the arguments the right hon. Gentleman put forward as being a satisfactory or sufficient reason for being unable to fix a 5 per cent. ceiling then. There are contradictions in the argument. I take it that part of the reply that the Government will make to this amendment, and others coupled with it, will be that there is no need for this because the Bill freezes rents. That is what the Government would like to get away with. If that is so, why is it now possible to put a zero increase ceiling on rents whereas on 2nd November it was impossible to impose one of 5 per cent.?
      In the interests of other hon. Members who wish to speak, I have no intention of delving into the problem of land prices, though why they should not be included in the freeze is beyond me. Arguments will no doubt be deployed from the Opposition Front Bench on their own amendments, which I fully support.
      There is inevitably a strong interaction, as we all know, between rent increases and increases in land and house building costs; one works on the other, the other works on the one. What we must try to do in any freeze and in any prices and

      631
      incomes policy is to keep down—and in a freeze to freeze completely—total housing costs. Land and house prices are immensely important. Moreover, it is extraordinary that the Government should say in their White Paper that they can freeze the rents of land but not the price of land because the rents of land enter into daily consumption costs. Surely the price does also; one cannot enter into it and the other not. In my view, that is a totally fallacious argument.
      I hope that we shall hear how the Bill is to affect the rising cost of housing. The best way in which the Government could reassure hon. Members on this side would be to accept the Amendment. It is certainly the least they can do.
      4.15 p.m.
      Mr. Nicholas Ridley: I find myself in a slight difficulty and wish to apologise to the Opposition Front Bench for it. I wish to talk about the price of land, whereas the Amendment which has been moved is about rents. Therefore, I shall be discussing a proposition which has not been put forward yet by those who will propound Amendments Nos. 8, 9 and 13. However, I think it would be helpful if I said a few words at this stage, though as I wish to be brief I hope that the hon. Member for Cornwall, North (Mr. Pardoe) will forgive me if I do not stray on to the question of rents.
      I believe the price of land will be one of the major problems of the future because it has increased by two or even three times its original value and has consequently had an effect upon the price of houses which has given very serious problems to those such as young marrieds who do not own a house—it is all right for those who do and for those who are switching from one to another. The price of housing has increased in London because there has been an influx of people wishing to buy houses and offices as a result of our joining the Common Market. That is the London area. For the vast majority of land elsewhere—whether it is building land, agricultural land, expensive houses or less expensive houses—the increase has been phenomenal yet cannot be due to inflation or any other special factor which
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      would have had this startling effect upon the price.
      Reasons for this must be found in economic factors, such as tax relief given in the Budget on interest on borrowed money. I made a few mild noises on the Report stage of the Finance Bill pointing out the effect that such a concession would have. It would be wrong to claim that it has been a major cause in the increase of the price of land, but equally it cannot be denied that it has had some effect. It has enabled the personal purchaser of property to buy land more cheaply, especially if he is well-off. It has helped the well-off to speculate in houses and land, with unfortunate results. A speculator has had to borrow money to buy the land. Equally, it cannot be denied that there must have been a considerable increase in the money available for this purpose in order for the banks to have been prepared to lend it to the building societies. That brings us back to the real problem which underlies the inflationary situation, that there has been too much money floating about.
      It is well known that the money supply increased at times during the summer by between 20 per cent. and 30 per cent. over last year's levels. It is interesting to note that, where the increased money supply has been greater than was needed for financing the increase in production, it has not gone into productive resources but has found its way into the purchase of assets which have been not in any sense creating new wealth but simply forcing up the price of properties.
      There is the added factor that this increase in the money supply in itself whetted people's expectations of further inflation and served to make property seem to be the most attractive investment as a hedge against inflation. This added factor accelerated the increase in land prices.
      I do not know whether I have been contentious in anything I have said hitherto. Perhaps the Opposition will say that they disagree with that analysis. Other reasons could be adduced, but if that analysis of the reason for the increase in the price of land and houses is broadly speaking true, it illustrates the effect that a surplus of money supply can have on prices. It cannot be argued that this is in any sense due to landlords or sellers of property

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      sticking out for high prices. Nor can it be laid at the door of the trade unions for having demanded high wages.
      It is a clear instance within the sphere of inflation where the only identifiable cause has been money, rather than the behaviour of persons. As such I would slightly cross swords with my right hon. Friend the Member for Barnet (Mr. Maudling) who suggested that we are suffering purely from a cost-push inflation and not in the least from a demand-pull inflation, because in this case buyers have been scrambling over each other bidding up the prices of land and houses, and it is demand and not cost-push that has been the cause in the escalation of prices.
      It must therefore follow that the only remedy to the problem is to reduce the money supply and to bring about the opposite effect. No control of a statutory nature is sensible against the background that I have sketched, and I will give no support to the Opposition Amendments which seek to control, by Statute, house and land prices. It would be unfair to bring down house prices by law, because often people will have mortgaged themselves and bought at the top of the market. To be forced by law to sell at lower prices could be a serious injustice to those people.
      It is equally impossible to say what is the right price for a house. Every house is different. It is an individual and completely separate entity, and each piece of land has a different value. To try to impose a rigid system of statutory control upon the price of land or houses seems to be an unworkable proposition. It is for that reason, I imagine, that the last Government left land and house prices out of their prices and incomes policies. It is for that reason that such prices are, rightly, left out of the Bill.
      In the most easily identified series of prices and price rises where the money supply is evident as the cause, not only do we agree that it is impossible to control it by Statute, but it must be conceded that it is impossible to control it in any other way than by financial management methods. This again underlines how difficult it is to use the law to control economic forces.
      Possibly I have been fortunate in picking the most obvious example for what I am trying to explain to the Committee, but the conclusion can be drawn that
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      perhaps the methods that I have suggested for controlling the price of land and houses are more appropriate for controlling the price of other goods, too.
      Mr. Anthony Crosland: The hon. Member for Cirencester and Tewkesbury (Mr. Ridley) is not correct in saying that the Labour prices and incomes policies contained no provisions for rents. On the contrary, he will recall that in 1969 we passed the Rent (Control of Increases) Act. Having said that, unusually, I agree with a considerable part of the hon. Gentleman's argument.
      Mr. Ridley: I said that they did not contain provisions for controlling the price of land and houses. I did not mention rents.
      Mr. Crosland: In that case. I have to answer that the prices of land and houses were not rising at one-fifth of the rate at which they are rising today. But I have some sympathy with the hon. Gentleman's general argument. There has been a great deal of confusion about the reason for the rise in land prices. I think that Ministers who, like the previous Secretary of State, think that the problem can be settled just by getting quicker planning consents and marginally increasing the supply of land are wrong, and there is much in what the hon. Member for Cirencester and Tewkesbury says about the effect of an increase in money supply. Where I take issue with him is that I decline to generalise from this to the rest of the economy. I have some sympathy with his proposal to restrict the money supply available for the purchase of land and in this particular sector of the economy, but if that were to be extended, as I think he suggests in other speeches, to a general case for restricting the money supply, I would then part issue with him, because I fear that that policy can work only at the expense of stopping growth and causing an increase in unemployment, which I should not be prepared to accept.
      I want to go rather wider than the hon. Gentleman who, perfectly reasonably, confined himself to one part of the sector with which this debate is concerned. Unlike the hon. Gentleman, I am convinced that a prices and incomes policy is necessary in an advanced industrial society. All the experience we have had since 1945 shows that general

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      demand management of a conventional Keynesian character—given that we absolutely must keep full employment—is unable to prevent an unacceptable degree of inflation. A new form of Government intervention is necessary, and I feel this the more strongly because I reject what is the only possible alternative—a drastic cut in total money supply, which can work only at the cost of growth and full employment.
      But while I have sympathy for the aims of an equitable prices and incomes policy, I have none whatsoever for this freeze and this Bill, with its ridiculous Title, its gross inequities and its glaring omissions. This amendment and others are concerned with one glaring omission—the price of housing—a particularly sensitive price, having a heavy impact on the cost of living and the standard of living, and one which not only bites deeply into household budgets, but has a strong psychological significance for the individual worker and his family which is heightened by the certain knowledge that huge profits are being made out of speculation in land and housing.
      We are bound to say a brief word about what has been happening to the cost of housing because what has been happening in the housing and land markets constitutes the background to the tripartite talks which took place at Chequers, and this background will largely colour the reaction of wage and salary earners to any proposals that the Government may make. I shall be very brief on this point because we debated the whole matter a fortnight ago.
      The price of owner-occupied houses, both new and secondhand, increased in the first half of 1972 at an annual rate of 40 per cent. In London, prices of new houses are up by 55 per cent. compared with a year ago. Many hon. Members will have seen the horrifying poll in the Evening Standard recently, carried out on 14th November by the Opinion Research Centre, according to which the number of people who expect to pay more than £14,500 for the average family house in the London area has more than doubled in the past three months. This constant rise in prices has created appalling inflationary expectations.
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      Plainly inflation invariably worsens when inflationary expectations become universal. People now expect that the prices of houses will continue to rise. They think that they must get on the band wagon before it is too late and are prepared to strain their financial resources and the household budget in order to do so. Consequently, there is now amongst young couples looking for a house a mood of insecurity and of resentment which makes the Government's task in getting their policies accepted a hundred times harder. As for the ordinary wage earner, with average earnings of £1,600 a year, he is altogether priced out of the market.
      4.30 p.m.
      On the question of council rents, to which the hon. Member for Cornwall, North (Mr. Pardoe) referred, 1 million council tenant households have already had a rent increase of £1, on 1st October, while a further 500,000 had an average increase at that date of 60p. For the country as a whole, as the hon. Member for Cornwall, North, pointed out, over the current financial year the increase in rebated rents—thus taking account of the points invariably made by right hon. and hon. Members opposite—will be 14 per cent. I do not believe that to be a realistic figure as I think it exaggerates the likely take-up of rebates.
      What will often be significant is the likely increase in unrebated rents, and this will be not 14 per cent., but 24 per cent. For millions of people, there will be a further increase next April. The private rented tenant faces even larger increases over the next 12 months.
      That is the background to this freeze on wages—a story of wild inflation, speculation and profiteering; a background of rents rising and house prices soaring while huge fortunes are made by property companies and landowners. The Government must face the fact that these trends have created the most unfavourable possible background for any attempt to reach a voluntary tripartite agreement.
      Unfortunately, in economic matters, bygones are often bygones. We cannot altogether undo the past. However, we might expect that this Bill will at least bring some alleviation to the situation and will undo a little of what has been done.

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      Above all, we would expect that for the duration of the Bill, while wages are to be frozen, an equal freeze should be imposed on council rents, private rents and house and land prices. After all, the first sentence of the Explanatory and Financial Memorandum to the Bill reads:
      "The Bill empowers the Government to apply a standstill in prices, charges for services, pay, dividends and rents."
      Let us, therefore, examine the Bill and see how far this laudable aim is achieved in the housing sector.
      Such an examination reveals that it will have only the most minimal effect upon that sector since the freeze applies only to a very small part of the private rented sector. First, regulated rents increased by rent officers or rent assessment committees during the 90 days will not be implemented until after the freeze. If we reckon that regulated rents are fixed about once every five years, the numbers involved will be perhaps one in 20 of unfurnished tenants, or 60,000 households.
      Secondly, the rise in controlled private rents is postponed. These rents were due to be increased on 1st January, 1973, by about 70p for tenants in London and 60p for those living elsewhere in England and Wales. Approximately 60,000 households will, under the Bill, be reprieved from this increase.
      Thirdly, the freeze applies to housing associations, where rents were due to move towards fair rents on 1st January, 1973. While we have no means of calculating the numbers involved, they will be small.
      That is the only protection afforded by the Bill to any sector of housing. The freeze wholly fails to touch the owner-occupied sector, comprising over 50 per cent. of households, and the council tenant sector comprising over 30 per cent. of households. The Bill excludes the 1st October increases in council rents—£1 for 1 million people and 60p for another 500,000. It excludes the rises in house prices, which affect some 200,000 purchasers in any one quarter. It excludes the rise in the cost of mortgages—after all, an extra ½ per cent. on mortgage rates will come in on 1st January, which will affect nearly 4 million existing borrowers. On a £5,000 mortgage this will mean an increase of about 50p.
      Mr. Gower: Does the right hon. Gentleman accept that if the Government took steps to freeze mortgage rates that might have the effect of drying up the source of mortgage money? That could inflict hardship on people attempting to borrow for the first time.
      Mr. Crosland: I referred to that question in the debate a fortnight ago when I proposed that that difficulty could be met by the notion of a building society stabilisation fund. I am certain that we need such a fund anyway on grounds unconnected with the present freeze.
      The Bill totally excludes furnished tenancy rents. If we assume that there are ½ million people in that sector and that their rents are reviewed on average every two years, over 60,000 tenants of furnished property can expect increases in the 90 days. The Bill wholly excludes tenants who agree a registered rent with their landlord under Sections 42 and 43 of the Housing Finance Act without going to the rent officer or the rent assessment committee.
      Examination of the Bill shows that, including those who lose out under the October rent increases, approximately 5¾ million households can expect increased housing costs from October to the end of the freeze period compared with only about 125,000 who are given any protection under the Bill. And, of course, nothing whatever is mentioned about the price of land. In other words, we have a freeze on incomes but no corresponding freeze on the price of houses, the price rise in which has been a major cause of inflation over the last two years.
      Housing is almost totally, incredibly, exempt from the Bill. It is the most exempt item in the whole package. Therefore, the builder, although his wage costs are frozen, can raise the price of any new house he may build by any amount that the market will stand—10 per cent., 20 per cent., or 30 per cent.—without the Government lifting a finger. The seller of an existing house can likewise ask whatever the market will bear, again without the Government lifting a finger. The landowner can continue to squeeze the last drop of profit out of his land, totally unaffected by the Bill's provisions. The speculative landlord can still make a "killing" in North Kensington, Hammersmith and similar areas, totally

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      unaffected by the provisions of the Bill. Building societies can put up their rates, totally unaffected by the provisions of the Bill.
      What sort of reactions will there be in our constituencies? How will the wage earners of Grimsby react when they read about what will continue to happen during a period which they are told is one of freeze? What have they been reading about since the freeze began? I quote from the Evening Standard of 10th November:
      "Estate sold for £1,520,000".
      A 2,200 acre estate in Oxfordshire was sold for that amount only a few days ago. The Financial Times, which even some people in Grimsby read—and they are sensible to do so—made the most intelligent comment on the Bill as it affects housing and property:
      "The initial reaction of the property industry to the Government's anti-inflation proposals was one of relief "—
      I am not surprised—
      "… The actual measure—a commercial rent freeze—is mainly of political importance and will have no significant effect on property values".
      I was interested to read in the Sheffield Morning Telegraph of 14th November:
      "£100 shock for house-buyers.
      House-hunters who have ordered new homes on the massive Gosforth Valley development at Dronfield, near Sheffield, got a shock yesterday when they were told that their bills are going up by up to £100.
      And the Government freeze on prices does not apply to their contracts …
      A spokesman at the prices unit of the Department of Trade and Industry says: 'There is nothing we can do. House prices are specifically exempt from the freeze regulations'"
      "There is nothing we can do", says the Department of Trade and Industry. It is clear that the new Secretary of State has imposed his own mark on his new Department.
      Mr. Ernest G. Perry: By his absence.
      Mr. Crosland: No, the new Secretary of State at the Department of Trade and Industry, who was responsible for the famous remark that I quoted a fortnight ago. "'What can I do?' Walker" has arrived at the DTI.
      I hope that the Minister of Housing—and I formally welcome him back to
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      housing as he made a great impression on all of us during the Committee stage of the Housing Finance Bill—will not say there is nothing which the Government can do. Of course, the Government could do something, complicated no doubt—but then every provision in the Bill is intensely complicated to carry out. The answer of complication is not sufficient. I suggested a number of practical steps in the debate a fortnight ago—for example, suspend the operation of the Housing Finance Act, which is basically the purpose of our Amendment No. 7; limit mortgage interest tax relief to first houses and to non-luxury houses; stop the uncontrolled fluctuations in building society lending; stop the present profiteering to which the Opposition constantly draw attention, in inner London particularly, in improvement grants; put at the very least an emergency higher rate of capital gains tax on purely speculative transactions in land and residential property; above all, produce a policy for land. Any policy would be better than the present state of affairs.
      The Chief Secretary to the Treasury (Mr. Patrick Jenkin): I am interested in the right hon. Gentleman's suggestion of a high capital gains tax rate on purely speculative property transactions. Will he give some indication of how he would define them?
      Mr. Crosland: I can give the hon. Member a direct answer, which enables me to take up my next point.
      The Prime Minister has been—and I say this with sorrow—extremely disingenuous with us about how far housing featured in his discussions with the TUC. He has more than once sought to give us the impression that housing did not figure largely in the discussions and that the TUC did not press the housing arguments. That is not correct. I have here a TUC paper dated 18th August which raises fundamental points about housing policy and makes it absolutely clear that the TUC attached major importance to housing being brought within the ambit of any package on prices and incomes.
      To answer the Chief Secretary's question, this paper, of which he will certainly have a copy, proposes how this special rate of capital gains tax should be levied.
      Mr. Patrick Jenkin Mr. Patrick Jenkin rose—
      Mr. Crosland: No, I will not give way. Surely no one is advancing the argument that it would not be possible to have a special rate of capital gains tax. Let me give the hon. Gentleman a simple definition of what I mean by speculation in land and residential property: transactions in land and residential property other than those carried out by an owner-occupier.
      Mr. Patrick Jenkin Mr. Patrick Jenkin rose—
      The Chairman: Order. The Chief Secretary knows that if the right hon. Gentleman does not give way he must not persist any more than any back bencher.
      Mr. Crosland: I thought that I had given an extremely clear and explicit answer to the hon. Gentleman.
      I return to the question of land. We have discussed this in the House before and my views on it are well known. The one thing which the Government cannot continue to do is to have a laissez-faire policy on land. They can attack the 1947 Act, the Land Commission and our proposals as much as they like. What they cannot do is sit on their backsides and do nothing.
      The TUC was absolutely right to treat housing as being a central factor in any prices and incomes policy. One cannot have a prices and incomes policy which excludes the cost of housing, and one cannot have a housing policy which ignores the problem of inflation. It is not a question, as was argued by the hon. Member for Cirencester and Tewkesbury, of saying that housing and land policy should be determined in future, not by Parliament, but by the TUC and the CBI. There has been a lot of nonsense talked on this issue. That is not the question at all. The true question is quite different; it is a question of priorities.
      4.45 p.m.
      If we give first priority, as we should, to combating inflation, it is no good having a housing policy which pulls totally in the opposite direction. If, on the contrary, the Government give first priority to having a laissez-faire, market-oriented land and housing policy, complete with cuts in subsidies, profit rents, decontrol, abolition of the land Commission, uncontrolled building society
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      lending and general "what can I do?" passivity in the face of land speculation, we shall not get an agreed prices and incomes policy. We must choose one or the other objective.
      The Government's land and housing policies, which have created the worst prices inflation in our history, were initiated with a great fanfare of trumpets at a time when the Government foolishly thought that they needed no anti-inflationary policy except confrontation and union bashing. The Government now find that they need a more constructive policy, but such a policy is fatally inhibited by the appalling legacy of the former Secretary of State.
      That sums up the story of the Government's recent efforts to find an effective counter-inflationary policy. One cannot spend two years deliberately increasing inequality in the distribution of wealth, indulging in eyeball-to-eyeball confrontations with the unions, creating gross hardship, injustice and insecurity in housing, and then expect the unions to radiate brotherly love.
      We need a complete reversal of all the Government's social policies as a precondition—not as a surrender to one side or the other—of an effective anti-inflationary policy. The amendments provide the opportunity of doing this with the crucial problem of land and housing.
      Mr. Christopher Tugendhat: The right hon. Member for Grimsby (Mr. Crosland) ranged very widely over land and housing problems, as is right for a Shadow Minister. I hope that the right hon. Gentleman will understand if I do not endeavour to take up all his points.
      The right hon. Member for Grimsby will have realised from my contribution to the debate on the Gracious Speech that I agree that abuses and profiteering in the land and property market have taken on the proportions of an immensely serious social problem. It is of the utmost importance for the Government, with as much speed as possible, to bring forward measures to tackle these abuses and difficulties.
      I take issue with the right hon. Gentleman when he says that much of what is happening in the property market is a cause of inflation. I think that it is largely a symptom and a result of the

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      inflation. It has in itself become extremely important and serious, but what we have seen happening in the land and property market arises from the fundamental problem of the depreciation of currency and is not, in itself, a principal cause.
      I wish to discuss Amendments Nos. 6 and 11, which have been bracketed with the principal amendment which we are discussing. During the Committee stage of the Finance Bill, the hon. Member for Heywood and Royton (Mr. Joel Barnett) developed an agreeable practice of putting forward what he referred to as probing Amendments, designed primarily to find out the Government's intentions on certain issues. Having discovered the Government's intentions, the hon. Gentleman was in a position to make up his mind whether he wanted to press matters further.
      The Amendments which I have put forward are probing. There is some uncertainty about both the White Paper and the Bill on two matters in which I am interested as a constituency Member.
      The first concerns service charges. We have discussed them at length in the House, especially during the debates on the Housing Finance Bill, and I was pleased when the Government were able to meet the wishes of London Conservative Members by bringing about a considerable tightening-up in the regulations governing service charges. Notwithstanding the improvements, we all recognise that service charges are open to abuse, that often even in regulated tenancies when it is impossible to raise rents landlords can get round the problem by jacking up service charges. In big blocks of flats in London where break-up has already occurred and where flats are on leases as long as 75 years, service charges are often used by property companies owning the freeholds to gouge tenants without any ability on their part, until the changes that took place earlier this year, to hit back.
      It is important that the Bill should be clear about service charges. The White Paper is not. The Bill does not make the Government's intentions clear and I hope that the Minister will be able to assure us that service charges are covered in exactly the same way as wages, prices, and so forth.
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      The second matter concerns unregulated tenancies. Here, too, there is a certain laxity of expression both in the Bill and in the White Paper. The White Paper specifically mentions controlled and regulated tenancies. It mentions business rents. It does not mention unregulated tenancies, and the uncertainty is not clarified by looking at the Bill. We look to the Minister to assure us that unregulated tenancies will be covered in precisely the same way as regulated and controlled tenancies. All of us who have any experience of London matters—this is common to both sides of the House—appreciate that some of the biggest difficulties have occurred among the unregulated tenancies—those in London with rateable values of £400 and above—which basically include most of the large mansion blocks found in Westminster, Hampstead, Kensington, Chelsea and areas of that nature, where it is not uncommon to find rents rising by 50, 75 or even 100 per cent. It would be intolerable if rent increases of this or any other kind were brought forward during the period of the freeze.
      No one on either side of the Committee is under any illusion about the activities of some of the companies concerned with this section of the property market, and there has been something extremely disagreeable in the combination of these companies reporting enormously high profits for their operations over the last few years while tenants have had their rents rising at a phenomenal rate and the scarcity of accommodation has been increasing. If only a small proportion of the huge profits of some of these companies had gone into building more residential accommodation, my constituency and others might be in a better position than they are today.
      I cannot believe that it is the Government's intention to exclude tenants of unregulated tenancies from the freeze, and I cannot believe that it is their intention to exclude property companies which deal in this section of the market from the effects of the freeze.
      Mr. Reginald Freeson: In speaking to his amendment and referring to unregulated rents, the hon. Member for Cities of London and Westminster (Mr. Tugendhat) has illustrated his case by referring to those properties above the rateable value of

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      £400 in London, and less elsewhere, which do not come under the "fair rent" provisions. As I read his amendment, I understood it to refer to all unregistered unregulated rents—that is, those which could become regulated but which have not been; in other words, the majority—beyond the 300,000 that have been registered, and not just the category to which he has been referring. Will he make clear to the Committee that he is referring to all unregulated rents and not just those above certain rateable values?
      Mr. Tugendhat: The hon. Gentleman has me at a disadvantage. In my amendment I am dealing only with those people to whom I have been referring.
      Mr. Geoffrey Finsberg: Paragraph 22 of the White Paper, covers those tenancies that will move from control to regulation. Together with those with rateable values over £200, they fall within the ambit of Clause 4.
      Mr. Tugendhat: I am most grateful to my hon. Friend. His knowledge of these matters is certainly greater than mine and is based on many years' experience in local government in London. However I was then referring to the section of the community of whom I had earlier spoken. I hope that the Minister will be able to reassure us on this point.
      There is one other aspect of the problem on which it would be interesting to hear the Minister's views and on which we all hope to see action as the freeze progresses. I have had the opportunity of talking to business people in my constituency—which has a great many business people one way and another—and their experience has been that a number of landlords are saying that while they have to abide by the freeze on business rents as they stand at the moment they will look to the tenant to make up for that by some other form of payment when the freeze ends. This is an extremely difficult matter to police. So many of the dealings between landlord and tenants are difficult for a Government Department to master.
      However, we must recognise that in freezing rents there is a great danger that landlords will, while abiding by the letter of the law, seek to ensure when the freeze ends that tenants make up for what has been lost. It is a difficult matter for the
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      Government to deal with but it is a point worth taking into account. Clearly it would be quite unreasonable to exclude the rents of any section of the community from a freeze of this nature. We must recognise that the freeze is of short duration—90 to 150 days—and that by freezing rents at present levels for the next 90 or 150 days we shall not get to the heart of the matter in the London and national property markets.
      I hope that some of the measures which the former Secretary of State discussed in the debate on the Gracious Speech for dealing with development land will be brought forward as soon as possible. I hope too that the Department of the Environment will take advantage of this lull to do some deep thinking about the whole position of residential accommodation in London and perhaps come forward with more radical ideas than we have previously heard for encouraging the building of new residential accommodation. That is essential because the pool of residential accommodation has been diminishing. Consequently we need incentives to build. I hope too that it will also devote some thought to putting tenants on a level nearer to those who own houses and thus enjoy the benefit of mortgages.
      At the very least the question of mortgages on second houses should be looked at if tenants are unable to gain any form of tax relief. The cost of extending tax relief to tenants in rented property would be considerable, but the argument in favour of doing so and limiting the tax advantages of mortgagees on second houses is worthy of the closest consideration.
      Mr. Gower: Might it not be unfair if what my hon. Friend suggests were introduced? Why should we penalise a person who has to live in two parts of the country, and therefore in two houses, while we give a large mortgage to a person who buys a very expensive house? That seems an inequitable proposition.
      5.0 p.m.
      Mr. Tugendhat: I have no desire to penalise people who are obliged to live in two parts of the country. Members of Parliament are in this category. But my hon. Friend will recognise that in today's affluent society an increasing number of people are buying weekend

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      homes, country cottages and so on. These people often derive considerable tax advantages out of what, in effect, is a luxury, whereas people who have only one home and are quite unable to think of buying it in my constituency are unable to gain any benefit, given the prices which are being demanded. These are the people to whom I refer. I hope that the Minister will be able to give us some assurances on service charges and unregulated tenancies.
      [Mr. GEORGE WALLACE in the Chair]
      Mr. Clinton Davis: When the hon. Member for Cities of London and Westminster (Mr. Tugendhat) repeatedly expresses his hopes that the Government will introduce legislation to deal with speculative land prices and all the other anomalies of which he speaks, he reminds me of an expression of opinion by the late Nye Bevan who said that to expect a Conservative Government to introduce radical proposals was to be about as hopeful as expecting a mule to deliver a large family. I think that the hon. Gentleman's hopes will be consigned into the dustbin, and I doubt whether he will get any change from the Minister.
      I deal first with two points about which the Law Society has written to the Minister concerning the practical difficulties which arise from the vagueness of the Bill's proposals. The first point relates to rent revision clauses in existing leases, where a rent is payable on 6th November and is increased thereafter, but before the end of the standstill period.
      We have no guidance from the White Paper or from the Bill on what is to happen about rent revision clauses. I hope, therefore, that guidance will be given by the Minister because solicitors and barristers will be asked to advise on this aspect and it is important to put them in a position to give cogent advice to their clients. There is nothing in the White Paper about furnished or unfurnished tenancies which are outside the "fair rents" scheme and it is absolutely essential, therefore, that legal advisers are in a position to advise their clients about that aspect of the matter, too.
      The Law Society has also posed a question which is relevant to our debate. It is whether the Government propose to
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      give retrospective protection to tenants in order to provide them with a defence to an increased rent for the period from 6th November, 1972, to the date of any order which may be laid, and to enable them to recover overpayments of rent. This matter has not been dealt with either in the White Paper or in the Bill. Are the Government able to offer the House some advice on those two important and practical difficulties?
      The hon. Member for the Cities of London and Westminster drew attention to the scandal of land speculation, a point made time and time again from this side of the House, and most eloquently by my right hon. Friend the Member for Grimsby (Mr. Crosland) yet again today. What will the Government do about it?
      Mr. Arthur Lewis: Nothing.
      Mr. Davis: My hon. Friend says "Nothing", and I fear that that is likely to be the case.
      In the mind of the ordinary housewife who lives in Hackney, Islington or any other stress area, this problem cannot be isolated from those which she faces in her daily or weekly situation. She has already faced the impact of increased rents if she is living in a council tenancy. There can be no doubt that she will exercise some pressure on her husband to ensure that she is not penalised by this standstill. The Government say, "It is something that happened in the past. It happened on 1st October and there is nothing to be done about it." That is absolute nonsense and must place the whole purpose of the standstill period in peril.
      Equally, one of the interesting features that I have experienced in the past few weeks at my advice bureau has been that a number of people have come to see me there and have asked, "How can the Government expect us to adhere to a standstill period when we see fantastic profits being made in land prices which have an enormous effect on our standard of living?" I can offer them no advice because clearly the Government have indicated that they are not prepared to do anything. The Government are prepared to be extremely firm with council tenants, workers and especially farm workers' wages. But when it comes to property speculators, pusillanimity is the

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      order of the day. The Government are totally cowardly about it.
      The reason may well be that property speculators are immune because they are very important supporters of the Conservative Party when it comes to the provision of funds, particularly at election time. [Interruption.] If that is wrong and the Government deny it, let them show that they are prepared to take action. That is the simple answer to the hon. Member's intervention. What does he suggest?
      Mr. Gower: One frequently meets people who are in property in a big way and who are Socialists—or who say they are.
      Mr. Davis: Then they must be condemned, too, and I am quite happy to see them the subject of any legislative action which the Government are prepared to take. Whether they pay the Labour Party or not is quite irrelevant. I am prepared to see action taken against them and that is the difference between the Labour side of the Committee and the Conservative side. The Government want their friends to be rewarded and not to be penalised in any shape or form. This is a matter of considerable gravity and it throws the whole purpose of the Government's standstill into jeopardy, together with the whole principle lying behind it.
      Mr. Frank Tomney: I realise that the hon. Gentleman wants to be fair. There is an edifice to be erected across the road on possibly the best site in the United Kingdom. We all know who will erect that edifice—Land Securities Investment Trust. We all know who is the boss of that trust. We all know the terms of compensation. If another barrow-load of cement is not poured on that site the terms of compensation will be not less than £15 million. Let us be fair. This applies to property speculators of all colours.
      Mr. Davis: That is precisely what I said. My hon. Friend has neither added to nor subtracted from anything I have said. I am not being selective about it; I am condemning them all across the board.
      Mr. A. E. Cooper: Rubbish.
      Mr. Davis: The hon. Gentleman says "Rubbish". But what is he proposing? Does he think that the Government ought to take any action in this connection? His silence is deafening.
      Mr. Thomas Cox: I am sure that as a fellow Inner London Member my hon. Friend must have experienced the problem that it being faced in Wandsworth where people living in furnished tenancies are now being evicted under different kinds of guises. Would my hon. Friend not agree that during the period of the freeze an eviction freeze should also apply? Many of these people, who are already paying very high rents have to pay even higher rents once they are evicted vet their wages are being frozen during the very period when this is happening.
      Mr. Davis: That is an experience which many of us share in Inner London. It is a substantial point and I hope that my hon. Friend will be able to develop it later. I want to see the Government introduce legislation of that kind. It is totally absurd for the Government to abandon their moral duty to impose sanctions against property speculation. It is right that the TUC should have made that a cardinal point of its representations. It is a scandal that the Government should have ignored it.
      Mr. Geoffrey Finsberg: The hon. Member for Hackney, Central (Mr. Clinton Davis) began with two specific questions. Certainly the hon. Member will not be the only one who wants to hear them answered. It is not only lawyers who are consulted. He and I know that we are consulted by constituents and it is useful to give them some information. The hon. Member omitted, when he was talking about his housewife constituent whose husband would have to pay an increased rent on 1st October, if the council were law-abiding, unlike Camden, to say that in many cases they would have substantially increased rebates. It is wrong to confuse the House by omitting these facts.
      Mr. Clinton Davis: What proportion of council tenants does the hon. Gentleman think have managed to obtain these rebates? He obviously is not able to answer for Hackney, but can he answer for Camden?
      Mr. Finsberg: I could have answered for Camden if I thought that the debate would take this somewhat irrelevant turn.
      Mr. Tugendhat: My hon. Friend may not have the figures for Camden, but in the City of Westminster about 60 per cent. or 7,500 council tenants, are eligible for rent rebates.
      Mr. Finsberg: I am sorry that the Member for Hackney, Central attacked property speculators and accused us on this side of wanting their support. It was not until a later stage that he said that he did not want to be selective. The hon. Gentleman knows that the Co-operative Insurance Company is one of the large investors in Centre Point, and that company does not give money to the Conservative Party.
      I thought that the hon. Member for Cornwall, North (Mr. Pardoe) made some interesting points, including some which should be examined. However, the hon. Gentleman tends to spoil his argument by snide and waspish cracks which are usually irrelevant. The hon. Gentleman is quite wrong—this is a feature that runs through the speeches from the other side—to dismiss the rebate issue, particularly when there is to be an extra increase of 50p in the needs allowance. That may not be of much value in North Cornwall, but it is of great value in the big cities.
      I support the views which were put forward by my hon. Friend the Member for Cities of London and Westminster (Mr. Tugendhat).
      Mr. Frank Allaun Mr. Frank Allaun rose—
      Mr. Finsberg: I must point out that the right hon. Member for Grimsby (Mr. Crosland) would not give way to the Chief Secretary.
      Mr. Allaun: The hon. Member has just said that the Government have increased the needs allowance by 50p. That is one of the suggestions made recently by the Prime Minister which the Government have not carried out. It would have meant an increase of 8½p a week for some tenants and nothing for most. But the Government did not do it. The Prime Minister told us it was merely an offer in the negotiations. I do not know what the hon. Member is talking about.
      Mr. Finsberg: The hon. Member having failed—
      Mr. Charles Loughlin: Answer the question.
      Mr. Finsberg: I will do so in my own way without interruptions from a sedentary position. The hon. Member for Salford, East (Mr. Frank Allaun), having failed in his campaign to scare tenants by saying that rents will double, is now trying to say that the extra needs allowance to which the Prime Minister referred, which I believe will be implemented, will be worth only 8½p. I am prepared to believe that is part of the package which included the £10 bonus for pensioners. Whether that is so or not, the £10 bonus does not exist until legislative approval is given to it next week. I am satisfied that the 50p needs allowance will be brought in to give effect to what is needed. That is my understanding of the speeches which have been made. I did not say that it was on the Statute Book.
      5.15 p.m.
      I support the points which my hon. Friend the Member for Cities of London and Westminster made because there is a need to include unregulated tenancies and service charges within the Bill. My hon. Friend was perfectly right to comment that there is a discrepancy between the White Paper and the Bill. It is right, therefore, to try to clarify it. I hope that we will be told later that these are points which will be taken into account and will be dealt with in accordance with the Bill.
      There are major problems in inner London, particularly those concerning service charges. There are abuses of service charges—which I hope will be dealt with by further legislation in either the present Session or subsequent Sessions—which have not been sufficiently checked. Most people, other than hon. Members, merely read what they see in a White Paper or a Bill and do not look behind it. If they do not do so they will assume that all rents and service charges are covered. It is important that we should get some clarification.
      The right hon. Member for Grimsby is out of touch with reality. I listened carefully—[Interruption.]—and courteously to his speech. He is trying to say that the Government are wrong not to accept the substance of Amendment No. 98 or

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      Amendment No. 9, which would control the price of houses, dwellings and land. He must know that previous Governments have realised that the prices of houses and dwellings cannot be controlled. There is no way of doing so unless a vast army of inspectors, valuers and surveyors is set up in every town hall. It just is not on. It was not until the right hon. Gentleman was interrupted that he said that he would exclude the owner-occupier from this control. How would he fix the price of a house that has never been on the market, except by bringing in an army of surveyors or valuers?
      It is impossible to control the prices of houses and dwellings. I hope to see—I think this is a view that is shared by many hon. Members—when phase 2 comes to be examined that we shall find some way of controlling the speculation in land. Clearly, there is no argument that such speculation is going on. My hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) mentioned it, as did my hon. Friend the Member for Cities of London and Westminster. But it is no good saying "Do something". The Opposition tried to do so with the Land Commission, which they know was an abject failure. If we are going to do something, let us make certain that it is effective.
      I wrote down—I hope correctly—that the right hon. Member for Grimsby said that there was a prospect of even higher rents over the next 12 months in the private sector. Those are the words which I took down and, if I may use the elegant phrase of the hon. Member for Hackney, Central, the deafening silence proves that I am not wrong. The right hon. Gentleman omitted to mention that although there may have been higher rents until the freeze, as from 1st January the tenants will get rent rebates that the measures of the right hon. Member for Coventry, East (Mr. Crossman) did not give them. Those measures merely increased rents without giving any form of rebate. That argument has been plugged ad nauseam by the hon. Member for Salford, East—
      Mr. Idris Owen: Is my hon. Friend aware that in my constituency 42 per cent. of council house tenants are to receive the rent rebate?
      Mr. Finsberg: I am glad to hear that. It will also be appreciated by the 40 per cent. of council tenants most of whom under Labour councils got no rent rebate at all until 1st October of this year.
      The right hon. Member repeated this canard about the £1 increase—again without reference to rebates. I may be wrong here but I find myself agreeing with him on one point. I, too, am against joint registrations. I am not at all happy about them. The advice I have always given to every private tenant is that he should not agree to joint registration. I am not satisfied that such registration is right. I have said so ever since the Housing Finance Bill was still a Bill, and I have not changed my views since.
      But for lack of time one could go on analysing remarks made by the right hon. Gentleman in a wide-ranging speech, but it is probably better if that speech is allowed to sink into oblivion, because much of it was obviously pulled out of the pigeon-holes at Transport House and very little was germane to the debate.
      It may be necessary to give standing to tenants associations so that they can collectively negotiate with landlords on many of the problems which face them, such as fair rents and service charges, because even now there are landlords who do not believe that any tenants' association has any right to exist at all. I would commend perhaps more to Labour than to Tory councils the Camden idea of proper joint tenant council committees which have substantial powers. These committees are most effective. The idea might be looked at in the private sector, because both landlords and tenants, whether public or private, have a joint interest in solving their problems by mutual agreement and not in ending up in bitter controversy. The major amendment in this series is quite unacceptable because it is out of touch with reality, but I very much hope that the Minister can give my hon. Friend the Member for the Cities of London and Westminster and myself the assurances we seek.
      I must apologise to the House and to the Minister if I am not here when the Minister replies but I have a very longstanding engagement at 6 o'clock.
      5.24 p.m.
      Mr. Ray Carter: There are hon. Members on both sides who know far more about housing than I do, but I am as concerned as anyone about inflation, which is the subject of the Bill. I want to refer once again to the rather bizarre spectacle of a Government which claim to be prompted by their overriding concern with inflation, yet do not recognise, or appear to be unwilling to recognise, that over their almost 2½ years of office they have taken, and are presently taking, measures—and continue to take measures—which stoke up the fires of inflation. What we are now discussing is not only the effect of rent increases and inflation generally but the unfairness of increasing rents at a time when the Government are pegging wages.
      The whole spectacle conjures up in my mind the vision of a householder standing outside his house which is burning to the ground, shouting for help and calling for the fire brigade, whilst at the same time casually spraying the remains of the house with petrol. There is no intention in the Bill, and certainly none in Clause 2, of containing prices and at the same time ensuring that people's wages are maintained at a level sufficient to pay the prices that are being asked. It is dishonest of the Government to describe this Bill as a prices and incomes policy when all it does is freeze wages.
      Are rent increases inflationary or are they not? I believe that they are, and that the House as a whole thinks so—this side certainly does. The country thinks so, and so do council tenants. If rent increases are inflationary—and the Minister has not tried to correct me—why are rents that have been increased over the course of the year, some as late as 1st October, allowed to continue whilst at the same time the people who are paying the increases are having their wages pegged?
      There has been an endeavour from the Government side to argue that there is no attempt in the provisions of the Housing Finance Act to increase rents generally; but I have a most vivid recollection of listening in the early stage of this Parliament to the Chancellor of the Exchequer and other Ministers telling us precisely what that measure would do. They were not shy about telling us that its purpose was, quite clearly, to reduce housing subsidies by between £200
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      million and £300 million, and that in order to achieve that objective they intended to increase rents. The simple conclusion I draw from that is that increases in rents must have inflationary effects.
      Mr. Hugh Dykes: Will not the hon. Gentleman agree that there was no net overall aggregate reduction in all the subsidies combined? They were redistributed.
      Mr. Carter: If what the hon. Member says is true, I shall be corrected by the Minister. I well recollect when I first came into the House and listened very attentively to what the Chancellor of the Exchequer and the then Minister responsible for housing had to say. It was made clear that the purpose of the Housing Finance Bill was to reduce subsidies by between £200 million and £300 million. Admittedly, the rent rebate scheme is part, but all the Act does is to redistribute less of what was there before. I stand to be corrected by the Minister, but he does not rise. Surely, therefore, the Minister must accept that if we withdraw that amount of subsidy from the council-tenanted sector the consequent increase in rent will have an inflationary effect.
      Mr. David Stoddart: I am sure that my hon. Friend's recollection is right. He will also recollect that in the debate on the White Paper and on the Second Reading of the Housing Finance Bill the Minister said that he wished to reduce subsidies overall, from what they would otherwise have been in 1976 if the 1967 Housing Subsidies Act had remained in force, by between £200 million and £300 million. My hon. Friend is therefore absolutely correct in saying that that was the Government's intention. It obviously was their purpose.
      5.30 p.m.
      Mr. Carter: I accept entirely what my hon. Friend says because he is a greater authority on these matters than I am. This was the intention, and it is now, in part, the fact. The Government have succeeded in reducing subsidies while increasing rents, and it is hypocritical of them not to admit that this has been one of the principal elements in the increase in inflation in the last 18 months or so. When the full effects of the Housing

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      Finance Act work their way through there will be an even greater impact on the whole subject of inflation.
      Is it fair for the Government to present a counter-inflation Bill containing a prices and incomes policy which acts rigidly on wages but less rigidly on prices? It is dishonest of the Government, and it has been apparent through the 2½ days so far spent on the Bill, to try at every turn to conceal the injustices inherent in the Bill.
      An advertisement appeared in the Press at the weekend drawing the attention of tenants to the rent rebate scheme. No doubt it will appear in other newspapers throughout the country over the coming months. We have heard a great deal about the scheme and the hon. Member for Hampstead (Mr. Geoffrey Finsberg), in fulsome praise of the scheme, appeared to believe that it would be a great act of social justice and would improve the lot of the under-paid. Quite how he squares that with the fact that the Bill will freeze the wages of those earning only £20 a week or less I do not know, but he appears to find it possible.
      Under the scheme a couple earning £20 a week with two children and paying £3 in rent will apparently get a rebate of £1·86. Add to what is left of their rent the amount they are likely to pay in rates—at the minimum it would be about £1—and subtract rent plus rates from the wage, and they are left with about £17·50 to £17·80. How can a family like that live on such a sum? It is impossible; yet the Government and Conservative Members proclaim the scheme as a great act of social justice. It is nothing of the kind and it will have no impact whatever.
      Mr. Gower: Surely the hon. Member is aware that he is criticising not the rebate scheme but the inadequacy of a particular wage. He is not making a valid criticism of the scheme, which seems to be a very fair one.
      Mr. Carter: I am glad that the hon. Member accepts my criticism as being fair. But 250,000 of those who are earning £20 a week work on the land and the Government are freezing their wages. Add the shop and distributive workers and the various other categories earning that wage and the total is perhaps 3 million, 4 million or 5 million workers. Does it strike the hon. Member for Barry (Mr.
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      Gower) as an act of great social justice that these workers should have their wages frozen?
      Mr. Gower Mr. Gower rose—
      Mr. Carter: I shall not give way because I wish to be brief.
      There is no chance of any voluntary agreement being brought in involving the TUC as long as the iniquities inherent in the legislation remain. The Government should do as Amendment No. 22 suggests and instruct the local authorities immediately not only to strike out any rent increases made so far this year for tenants whose wages will be frozen but to ensure that in the 90-day period, and certainly in the standstill, there will be no further rent increases for those tenants.
      Mr. John Sutcliffe: Like the hon. Member for Birmingham, Northfield (Mr. Carter) I readily acknowledge that there are many hon. Members who know a great deal more about housing than I do. I hope that he will forgive me for not pursuing his remarks because I wish to speak to new Clause 1 which stands in my name and which I understand is being discussed with the other amendments.
      The clause seeks to bring the price of council houses within the freeze. I do not know whether the demand to buy council houses which has been experienced in the Teesside county borough is paralleled in other parts of the country, but since the inception of Teesside in 1968, 7,600 applications to purchase council houses have been received. Sales completed so far amount to 3,115, and 955 applications have been withdrawn for one reason or another. Last week 3,530 applications to buy council houses were still outstanding. By any reckoning that must be considered a huge backlog of sales to be processed.
      The problem is compounded by a conveyancing system which is absurdly slow, and I am informed that taking on extra staff will not speed it up. It means that there is a new form of gazumping for council house tenants who wish to purchase their homes. It is a new form because no third party is involved. The council policy is to revalue its houses after three months, so that the council sells at current market value irrespective of how long the negotiations may take.

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      In many cases such a long period elapses between the original valuation when the price is agreed subject to contract and the exchange of contracts that the final contract price is way above the original valuation price.
      An example of this was where a price agreed at Easter this year of £2,350 subject to contract because £2,840 when the house was eventually sold in October, a gazump of £500. Another aspect which gave rise to resentment and anomaly was where two identical houses stood next to each other. One was valued at £2,045 in May and sold at that price; the other was visited by the district valuer in February, but a value was not settled until October, when it was fixed at £2,450.
      I am sure that the hon. Member for Putney (Mr. Hugh Jenkins) will argue in the terms of his amendment to my clause that no more council houses should be sold during the freeze, and many of his hon. Friends may argue the same theme. But the Labour council in Teesside, already overwhelmed with applications, considered that very question recently and took a contrary view. With 3,530 applications still to be processed, it decided to continue to receive applications, which are coming in at the rate of 40 a week. But it decided that from now on all applicants will be told that their applications are more than likely to be dealt with by the Cleveland county authority after the Teesside county borough goes out of existence in 1974.
      The Bill may not be the appropriate vehicle to control speculation in residential accommodation or in property generally, or to deal with the problem of hoarding development land and many other problems raised in the debate. I agree wholeheartedly with my hon. Friends the Members for Hampstead (Mr. Geoffrey Finsberg) and the Cities of London and Westminster (Mr. Tugendhat) that these problems must be dealt with effectively by the Government, at least in the spirit of the Bill if they cannot be dealt with in the terms of the Bill.
      Mr. Ted Leadbitter: The hon. Gentleman's amendment would prevent the sale of council houses at a price above the levels ruling before 6th
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      November, for a 90-day period. The hon. Gentleman has said that conveyancing is slow process. Is he not, therefore, wasting the time of the Committee? Labour and Conservative councils are selling council houses at as much as £1,500 more than the prices quoted as recently as four months ago. This raises the question not of the amendment covering a 90-day period, which is nonsensical, but whether council houses should be sold at all.
      Mr. Sutcliffe: I hope to deal shortly with the questions the hon. Member for The Hartlepools (Mr. Leadbitter) has raised. I have not much more to say on the matter. The hon. Gentleman will have his opportunity to make those points during the debate. It is possible within the terms and spirit of the Bill to detach council house sales from the market forces of supply and demand and relate district values to 6th November, at least for the 90-day period, and I hope for longer. District values at 6th November are readily identifiable.
      The problem is in many ways artificial, because the demand and scarcity in the open market are not strictly relevant here. The problem arises from an administrative difficulty suffered by the Teesside council, which is overwhelmed by applications. I do not know whether Teesside is unique—
      The Temporary Chairman: Order. I believe that the hon. Member for Enfield, West (Mr. Parkinson) is reading a newspaper, which is entirely out of order.
      Mr. Cecil Parkinson: On a point of order, Mr. Wallace. I was looking only at a piece of information in the newspaper which is relevant to the debate. It concerns wage rates being offered in the Manchester district.
      The Temporary Chairman: That is quite all right, but the hon. Gentleman must not make it too obvious.
      Mr. Sutcliffe: At least the acceptance of my proposed Clause would obviate gazumping and anomalies in valuations after 6th November. In answer to the hon. Member for The Hartlepools, it would relieve the situation for the Teesside council, and give that council an opportunity to consider ways of dealing with the predicament, which, to be fair, it inherited. Therefore, I commend the

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      clause to my hon. Friend the Minister and hope that he will consider the matter to be one that should be tackled within the terms of the Bill.
      5.45 p.m.
      Mr. Ted Rowlands: I will not follow the hon. Member for Middlesbrough, West (Mr. Sutcliffe) in speaking about his clause, for the simple reason that there is nothing more irrelevant to our housing problems than the sale of council houses. The rise in price and increased demand in his area can be directly related to his Government's imposition of swingeing, unnecessary rent increases, which are driving people to buy rather than remain in rented houses.
      I want to turn briefly to one of the most bogus arguments used by Conservative Members to oppose our suggestion that the Bill should contain a form of rent freeze, retrospective to 1st October, for council house tenants. One Conservative Member after another has quoted the figures for tenants receiving rent rebate as if the rebate completely wipes out the inflationary effect of the Housing Finance Act. One hon. Member spoke of 42 per cent. of tenants in his authority's area receiving rebates; but that means that 58 per cent. of the tenants there are paying up to £1 a week more in rent as a direct result of Government policy. We do not want to know the percentage of tenants receiving rent rebate. It would be much more illuminating to know what percentage of tenants are now paying less rent than they were when the Act was passed. That is the most relevant statistic.
      The Minister cannot make any general statement about the number of people receiving rent rebates. In answer to Question after Question his Department has been unable to provide any statistics for the number of people receiving rebates. When the figures of 42 per cent. or 50 per cent. are quoted they inevitably include all those who were originally receiving supplementary benefit for rent but are now registering for rent rebates under the local authority. The figures are a gross exaggeration of the number of people receiving new benefit under the scheme.
      Of the 11,000 council house tenants in Newport, Monmouthshire, 3,600 are receiving rent rebates. That seems a high figure; it is a third of the tenants. But
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      no fewer than 2,500 of them were originally receiving supplementary benefit; so it is just a transfer of benefit in their case. There were 600 people benefiting under the local authority's old rent rebate system, so the net increase of people in receipt of rent rebate in Newport as a result of the Housing Finance Act, 1972, is 500, out of 11,000 tenants. Against that, the overwhelming majority of those tenants are having to pay much higher rents than ever before. We should hear no more of the bogus argument advanced as a defence against our amendments that the rent rebate scheme is upsetting them.
      As for the argument of Conservative hon. Members who had said that the answer is not to include rent within the ambit of the Bill but for people to accept the pittance of the needs allowance of 50p, my hon. Friends have long memories of means testing. To say that the solution to the problem of modern-day inflation is to extend means testing is deplorable.
      We have heard two speeches from Conservative hon. Members representing London constituencies who have spilled crocodile tears about the impact of their Government's policy on tenants in their areas, tenants who are usually in quite wealthy circumstances, often in expensive flats. We share the feelings of those hon. Members about this. We would willingly join with them in any lobby to campaign against the exploitation of tenants in Westminster or Hampstead, as much as we would for tenants in Merthyr Tydvil and in South Wales generally. But we will not take from them the double standards with which they approach the debate. On the one hand, they apparently shed tears over tenants in Westminster, but no mention is made of the average family in a council house in South Wales or anywhere else.
      Finally, I come to a point which has a direct constituency bearing. In the same week that the Government have guillotined this Bill and made effective debate impossible, they have made two statutory instruments to compel two local authorities in South Wales to impose a £1 a week increase in the rents of their tenants. Nothing highlights the present situation more than the fact that on 6th November the majority of tenants of those authorities, including my local

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      authority, will have imposed upon them an extra £1 a week when their wages have been frozen.
      What is even more disgusting, reflecting the whole attitude taken towards the debates during the passage of the Housing Finance Act and the debates on this Bill, is that those statutory instruments, although local instruments, have profound general significance inasmuch as if they were pursued they would remove the democratic right of local authorities on matters of housing and would impose increases in rent during the period of the freeze. These statutory instruments have not been laid before the House and will never be the subject of normal procedures in the House for debate and discussion. In other words, just as elected local authorities have been deprived of the right to speak out and defend the people they represent, so the House of Commons is being deprived of an opportunity of debating statutory instruments of such importance and significance. But this is characteristic of the whole way in which the Government have behaved over the last two and half years.
      There is only one answer. Under paragraph 4(2) of the schedule—the infamous or famous schedule—the Government are taking a power. The paragraph states:
      "The appropriate Minister may by order provide that any Act passed before this Act, or any provision having effect under any such Act, which relates to prices, charges, remuneration, dividends or rents shall, while section 2 of this Act is in force, have effect subject to such exceptions, modifications or adaptations as may be specified in the order."
      One of the few welcome orders the Minister could bring before Parliament under the schedule would be one to suspend the Housing Finance Act, with effect retrospective to 1st October. If he did that, the Prime Minister could approach the TUC, on this subject at least, with cleaner hands than he approached it during the negotiations a month or so ago.
      My hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon), in the exchanges a few days ago, said that the reason why the Prime Minister now called upon the nation to unite behind him was that he had gone to the discussions and negotiations with unclean hands. One of the dirtiest parts of his hands is that he implemented the Housing Finance
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      Act only a month before the freeze, increasing rents by 25 to 30 per cent. for the majority of council house tenants.
      One of the greatest contributions to fighting inflation would be for the Government to abandon the persecution and deliberate discrimination against the vast majority of council house tenants.
      I hope that all the amendments will be accepted. I oppose the complete irrelevance of the Bill to one of the major features of inflation, which is the cost of a roof over one's head. I deplore the fact that the Government have deliberately increased rents unnecessarily and without justification.
      Mr. Gower: The hon. Member for Birmingham, Northfield (Mr. Carter) was one of more than one hon. Member on the Opposition benches who pleaded a special case of those who are very lowly paid, people such as farm workers and those in the distributive industries, who suffer even a modest increase in rent or other outgoings of their normal domestic activity. It is these particular people who suffer most from a long continuation of inflation. It is these people who would derive the maximum benefit from anything that would lessen inflation, and it is they who would gain most from the across-the-board £2 which was offered. It is these people who suffer every time when someone higher up the wages scale gets a much larger increase.
      This is a short-term Bill and we on the Government benches should be foolish if we did not admit that it is a very blunt instrument. I do not mind hon. Members on the Opposition side criticising the Bill for being somewhat blunt, but I argue with them against the unfairness of criticising the Bill for not containing the sort of provisions one would look for in a long-term solution.
      The right hon. Member for Grimsby (Mr. Crosland) wanted a long-term solution to meet the problem of the cost of land, to deal with land speculation and to meet the problems of those who buy houses on mortgage and the prices of which are excessively high. Indeed, the right hon. Gentleman wanted some long-term solutions to deal with the problem of the cost of houses, new or secondhand. Surely, in a modest, blunt and short-term measure of this kind, one would not expect to find long-term solutions of that nature.

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      Here one might say that we have improvised. The Bill, by its nature, has had to be put together hastily. It is to deal with the most pressing, desperate problem, admitted by all parties, by every party in the House, to be a serious problem facing our economy and people. To that extent I should have thought that some of the criticisms we have heard today have been inappropriate for a Bill of this nature.
      I agree with my hon. Friend the Member for Cities of London and Westminster (Mr. Tugendhat) and others of my hon. Friends that we want a long-term solution to deal with some of the worst facets of the speculation in land, and we need to study and find a remedy for some of the worst facets of the higher-priced properties which are rented in London and other cities of particular stress.
      Mr. Arthur Blenkinsop: I assume that when the hon. Gentleman refers to his rejection of long-term solutions as being inappropriate to the Bill, he is very much in favour of immediate emergency action for these areas?
      Mr. Gower: I shall deal with that point now. It would be unwise to try to achieve a short-term, hasty solution to deal, for instance, with the cost of land. That matter requires a permanent solution, one which is carefully phrased and will effect a remedy. When in office, the Labour Party produced the Land Commission and all the associated legislation. But I do not think that the Labour Party would go so far as to claim that that was a complete answer. Despite all the careful thought that went into it, it showed itself to be singularly ineffective in dealing with some of the worst aspects of the need for providing an adequate supply of land for new housing.
      6.0 p.m.
      The right hon. Member for Grimsby suggested that we should take steps to prevent any increase in mortgage rates. I think this would have a disastrous effect. It could result in a famine in available finance for house purchase. Under the Labour Government it meant that we had a long term when it was extremely difficult for young couples to obtain mortgages. I am not suggesting that the present situation is ideal. It is not. At any rate, we want money to be made
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      available through the media of the building societies, the local authorities and any other agencies which provide finance for house purchase.
      The rise in house costs is a far more sophisticated problem than has been suggested in most speeches. It is not merely due to one or other reason which has been suggested. It is a combination of many circumstances, not least the recognition in the last year or two that there is no better investment than to purchase the home in which one lives. This has occurred to many people, and more are coming forward eagerly to buy their own homes in all parts of the country.
      [Mr. E. L. MALLALIEU in the Chair]
      Mr. Rowlands: Does the hon. Gentleman accept that that is why the price of houses in his constituency has risen from £11,750 to £24,750 in less than a year?
      Mr. Gower: There are all kinds of houses at different prices in my constituency. I do not deny that, as in other parts of the country, people have suffered from the general price increase, but more houses are being occupied by young people in my constituency today than before. I hope that effective steps will be taken to curtail further increases beyond the means of those who wish to purchase houses.
      If all the blame were to be apportioned to the cost of land it would not be the fact, as it is, that second-hand houses are commanding just as great an increase in price as new houses. I know of many cases in my area of new houses being sold by builders to people who have gone in and almost immediately sold them at a large profit. That indicates that builders are not selling houses at excessive prices.
      Mr. Arthur Lewis: This is Tory practice. For years the Tories have claimed "Let us have a free-for-all; let us grab as much as we can." This is Tory philosophy.
      Mr. Gower: It is certainly better than the philosophy of having nothing for anyone, which was the result of the Labour Government's policy.
      I turn now to the serious argument put forward by the hon. Member for Cornwall, North (Mr. Pardoe), who must agree that this is a more difficult problem than he outlined. He suggested that it

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      could be dealt with by one amendment. This is an extremely involved and sophisticated problem.
      The hon. Member for Merthyr Tydvil (Mr. Rowlands) spoke in derisive terms about rebates. Some of the rebates will go to meet the increases in rent which have arisen from legislation passed by the Labour Government.
      Mr. Rowlands: What percentage?
      Mr. Gower: Many are in the private sector. The hon. Gentleman will recall that the increases in rent which have occurred in recent years in the private sector have resulted from the Labour Government's legislation, which was passed without the benefit of rebates. Some of these rebates will go to meet the increases due to that legislation.
      Let no one imagine that these rebates are negligible in all cases. The inference has been that they are small fry. My hon. Friend the Member for Kensington, South (Sir B. Rhys Williams), who unfortunately is not now present, told me that in his constituency some rebates will amount to as much as £300, £400 or £500 a year.
      Mr. Arthur Lewis: Rents are much higher in inner London.
      Mr. Gower: I appreciate that rents are much higher in inner London than elsewhere. Nevertheless, rebates to be paid in some of the inner London boroughs are of that order.
      Mr. Loughlin: Do not let us argue about the effect of rent rebates. Will the hon. Gentleman give us the percentage of tenants who will be paying less rent in total in consequence of the Bill, even after they have had all the rebates to which they are entitled?
      Mr. Gower: That will depend partly on the take-up. Nobody can forecast the take-up at this stage.
      Mr. Julius Silverman: Does the hon. Gentleman know the Birmingham figures? Out of 60,000 private tenants in Birmingham, which has already operated a rent allowance scheme, the take-up so far is about 450.
      Mr. Gower: I am assured that in most cases it will be vastly greater, be-
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      cause the national scheme has received infinitely more publicity and has been advertised in greater detail throughout the country.
      I turn now to what was said by the hon. Member for Gloucestershire, West (Mr. Loughlin). By definition, those who receive these rebates will broadly be those who have the greatest need.
      Mr. Loughlin: They will not.
      Mr. Gower: Of course they will. To that extent, it is vital that they should receive them. The people who will suffer from rebates being withheld will be those least equipped to endure without them.
      There is a good argument for including rent increases in any measure which is designed to tackle the freezing of inflationary tendencies. My right hon. Friend and his colleagues have reserved the right, which was criticised by the hon. Member for Cornwall. North, to bring in orders to deal with some of these problems. I share the hon. Gentleman's distaste for too much delegated legislation. But in such a sophisticated matter with an infinite variety of problems, I believe it is better to have a flexible instrument of this nature than the blunt amendment which the hon. Gentleman has tabled. I am not quibbling or quarrelling with his motives. I think his design is correct, but I do not believe that he would effect it properly and fairly merely by such a broad amendment. If my right hon. and learned Friend has the power to deal with detailed problems by an order, I think that is preferable in these circumstances able to make an announcement shortly.
      We all distaste the spread and increase of delegated legislation. However, the experience of successive Governments—I do not think that a Liberal Government would escape this problem—is that the complexities of contemporary life have made it essential in many cases for this kind of legislation to be used.
      I hope that hon. Gentlemen will not feel that the Bill is wrong because it does not include all the detail they would wish. The Bill will confer the greatest benefit on those whose rights they have pleaded. The slowing down of inflation will be of the maximum benefit to the lowest paid. It will confer greater benefit on the agricultural worker and the distributive worker than upon the highly paid. I

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      hope, therefore, that the Opposition will find it possible at least to support the final implementation of this legislation.
      Mr. Hugh Jenkins: On a point of order, Mr. Mallalieu. In referring to new Clause 1, the hon. Member for Middlesbrough, West (Mr. Sutcliffe) said that I should no doubt have an opportunity to discuss sub-Amendment (a). May I be allowed a couple of minutes to do so in order to enable the Minister effectively to reply to the debate?
      The Second Deputy Chairman: I should like to allow the hon. Member for Putney (Mr. Hugh Jenkins) his two minutes. Unfortunately, however, the Committee is pressed for time and I must allow a certain amount of time for the winding-up speeches.
      Mr. Frank Allaun: I am sorry to ditch my hon. Friend the Member for Putney (Mr. Hugh Jenkins). However, I have only five minutes, so I hope he will understand my predicament.
      Mr. Hugh Jenkins: I will give my hon. Friend my notes.
      Mr. Allaun: First, I wish to refer to the absence of the Secretary of State. There may be a serious reason for his absence this afternoon. Otherwise I regard it as inexcusable that he should not be present during a debate of this kind. Possibly the Minister for Housing and Construction will give the Committee an explanation.
      Several million families will have to pay further increases in rent next year. Those increases would be justified only if they were necessary to cover the cost of housing after subsidy. However, it is well know that these increases are unnecessary. They are therefore quite different from some other increases which are to be suffered. This measure is entitled the Counter-Inflation (Temporary Provisions) Bill. It is difficult to imagine anything more likely to be inflationary than unnecessary rent increases. Certain other increases can be justified on grounds that they are required in terms of our entry into the European Economic Community. However, even the Minister could not argue that rent increases are unavoidable because of our entry to the EEC.
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      Yesterday it was said that many of the new rents which have been imposed recently were near the "fair rent" level. With respect, no one can know that. They are to be imposed by rent scrutiny boards, against which there is no appeal, and on criteria which are extremely doubtful. One hon. Gentleman on the Government side referred to our "scare-mongering". My hon. Friends and I believe that that could still come about document, which estimated that rents would be more than doubled by 1976. I believe that that could still come about if we were to allow it.
      Rent scrutiny boards, for example, are to take into consideration the investment value of property. Is that to apply in respect of council houses, which may have been built at a cost of £300 but are worth a great deal more today? Taken on that basis, such an increase may possibly be well over 100 per cent.
      Many of my hon. Friends have referred to the rebate trick. Many of those involved are old-age pensioners who are not affected one way or the other. Of the remainder, most are likely to receive increases in their net rents rather than reductions.
      Why have the Government taken the trouble to include a clause saying that they "may" prevent further rent increases although they do not operate it? They must realise how vulnerable they are in this respect and how hypocritical it is to claim that they are trying to curb prices while proceeding deliberately to impose unnecessary rent increases. Can it be that the Government fear that they will unite the opposition of the unions, the Labour Party, councillors and tenants' associations against further rent increases if they are imposed? Are they preparing for a retreat if the pressure grows sufficiently great? I need not repeat that a big rent increase is a big wage reduction.
      Finally, I want to refer to the daddy of all land price increases, and some lovely cases have been quoted. Lord Wimborne is now worth £26 million for 575 acres of his land at Poole. Those acres were worth approximately £200,000 in 1967. Building permission is now to be given and they become worth £45,000 an acre. Lord Wimborne has just sold 7½ acres at that price, so he is now worth £26 million, with further increases taking place

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      as we are talking. Prices are going up every day during the period of the freeze. We maintain that public ownership is the only alternative. The Government ask what they can do to stop these increases. They could drop the Bill. As my hon. Friend the Member for Merthyr Tydvil (Mr. Rowlands) said, the Government could drop the idea of cutting by £200 million a year the subsidies which would have been paid by 1975.
      6.15 p.m.
      I am not normally bitter but I am deeply angry with the Ministers and civil servants responsible for the Bill. They are inflicting misery on vast numbers of people. The Ministers are sitting comfortably in Whitehall while the councillors are having vented on them the anger of thousands of tenants for rent increases which the councils strongly object to having to impose. The Ministers escape all that anger. It makes me bitter.
      I believe that the Government will never be forgiven for the increases and for the Bill. I believe that they can be forced to abandon the serious increases which will face us in the coming years.
      Mr. Freeson: We are discussing the Counter-Inflation (Temporary Provisions) Bill. Whatever may be argued on either side of the Committee and in the country about the capacity of this or any other Government to control inflationary processes in the housing and land markets, it is clear that as a result of the Housing Finance Act we shall see next year a 14 per cent. increase in council rents after rebates. Next year, under the Housing Finance Act, 1972, the standard unrebated rents that will emerge—which is the appropriate level to look at when discussing inflation—will bear an increase of 24 per cent.
      The Government could take action. They could accept our amendments. They could take action even without the Bill. Section 105 of the Housing Finance Act gives the Minister power virtually to suspend the operation of the Act, or any part of it, to any group of property. We have been told that in practice the temporary first stage of the Government's freeze policy may extend until next April and not just for the 90 days talked about so far. That is on the record. If that be the case, is it the Government's intention
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      to suspend the 50p increase on council house rents which will fall due in many local authority areas as a result of the 1972 Act? Will the Government give a specific undertaking, as we are talking about a freeze, that they will apply that freeze and suspend that 50p a week increase on council house rents next April?
      Further, will the Government use their powers under Section 105 of the Housing Finance Act, 1972, to suspend the 50p increase per week which will operate in respect of many other council properties in October, 1973? These two steps will be the only way open to the Government to apply the freeze in such a way as to avoid the 14 per cent. increase in council house rents, net of rebates, which we can expect under present Government policy.
      Mr. Hugh Jenkins: I do not know what my hon. Friend's experience is in his constituency, but in my constituency many rebated rents, with the new rent and the new rebate, are being increased by as much as £2 a week. I can give examples of cases which I have quoted to the Minister. He has confirmed that an increase of £1·63 for an old-age pensioner is approved by the Government. That is what we are being asked to accept.
      Mr. Freeson: I have not had personal experience of that kind of case in my area, and I hope my hon. Friend will receive a suitable reply from the Minister.
      We must accept by implication that nothing can be done under the freeze to handle the problem of furnished properties and their rents or to deal with unregulated rents. I do not mean the class of property to which the hon. Member for the Cities of London and Westminster (Mr. Tugendhat) referred, namely, properties at present outside the scope of regulation under the Rent Act, 1968. I refer to the majority of properties which have not been referred to rent officers, but the rents of which have been increasing. It is the bulk of the private sector and no method has been proposed in the Bill to handle it. What does the Minister intend to do about service charges and the rents of properties with rateable value above £400?
      I turn now to prices of houses and of land. In the run-up to the Bill and since its publication we were told that land

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      and housing could not be dealt with under the terms of the freeze or by any other regulatory means. This is a key factor in the situation, as my right hon. Friend the Member for Grimsby (Mr. Crosland) pointed out. There has been a 50 per cent. increase in land prices for development in the past 12 months. There have been lower increases in labour charges—7 to 10 per cent.—and there have been lower increases in the price of building material also within the 10 per cent. level. The big increase has been in the purchase price of land. We also know there has been a rise of over 30 per cent. in house prices in the past 12 months, a rate which is continuing unchecked in the current year.
      This is the sphere, apart from the question of rent control, of which the Government have decided to wash their hands completely. They say they cannot—I say they will not—do anything to check the situation. I put it to the Government that this problem could be tackled. There is no question that if speculation—a prime factor in inflation—were dealt with, there would be a major assault on the psychology as well as the actuality of inflation. Apart from anything else, something like one-quarter to one-third of wages and salaries go as mortgage repayments as well as in rents.
      The rate of increase in this element of the cost of living is far higher than the rate of increase in food prices. By far the biggest rate of increase in the cost of living index is in the subject we are discussing this afternoon. It has a major effect on the activities of local authorities in urban renewals, slum clearance, new buildings and so on, as well as in related matters such as the provision of public services, which I shall not pursue in any detail tonight. It is having a major impact on the quality of life, and the future quality of life, in the major cities.
      The Government should take steps to tackle this problem in terms of the economics of the present situation. It would be possible, by accepting the Amendment, for a ceiling to be imposed on all land and property sold for urban development and redevelopment. It also would be possible for a similar ceiling to be imposed on the price of houses and flats sold after modernisation and conversion with the aid of improvement grants. This is a matter of great importance in inner
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      London. There are procedures whereby this could be done. They have been put to the Government and have been rejected. I ask the Minister to look up the correspondence and papers which lie in the Department and to have another look at this matter rather than to say that nothing be done.
      These are the reasons why we have tabled these amendments. It is a matter of political decision in the first instance, and that decision could be taken today if the Government accepted the amendments. We could establish a practical and reasonable control over the prices of land for development and redevelopment and on the prices of key properties in the market.
      One final point I should like to make brings me back to the problem of council housing. I am not going in detail into the question of the sale of council houses. Other hon. Members have raised valid points on this subject. It is nonsense to reduce the quantity of rented property by Government policy at the same time as every major city is crying out for an increase in the number of rented properties. However, there is more to this than the problem of preventing a further cutback in the rented sector. If the Government would reverse their policy on the provision of council housing and the proportion of council housing for rent and on rents and return to the principle of rents related to the cost of providing housing, instead of the market profit rents which they have pursued under the 1972 Act, this would have a major impact on inflation.
      The kind of rent policies which were pursued in the past by most local authorities, policies which have now been rejected by the Government's 1972 Act, were disinflationary; they held costs down. I shall not pursue the matter in detail owning to lack of time. The Minister knows the exchanges that took place during Committee proceedings on the Housing Finance Act, 1972. He also knows that figures were quoted which have not been confounded by any statistics produced by the Department showing that the kind of rent increases visualised in that Act are not necessary in terms even of meeting the costs of providing the houses. It would be possible to half further increases under that Act in this Bill, if amended, without adding unduly—if

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      at all—to the total cost of providing and maintaining the houses.
      6.30 p.m.
      If time permitted I would elaborate on these matters. The Minister knows that they have been argued in great detail. I will end with one last plea which is directly related to inflation. The present Minister and his predecessor have said time and again that there is no restriction on council-house building. Hon. Members on this side of the Committee have said that it is not good enough to stand at the Dispatch Box, or anywhere else, and say that action needs to be taken to step up building. An enlargement in the council house building programme and a return to reasonable cost rents would have a marked impact on inflation. We have dropped from 414,000 houses completed in 1968 to about 350,000 in the current year and, despite what is going on in the private sector, the prospect is that number will fall even further. The only way in which there can be a major change is by means of a massive increase in council house building. That would have a marked impact on the inflationary situation, especially if it provided for a return to sensible rent policies such as we have been advocating.
      Mr. Channon: We have had a very long debate on a series of very important topics. May I first thank the right hon. Member for Grimsby (Mr. Crosland) for his kind references to me. I am pleased to be back in this sphere again, and it seemed to me that there were some familiar faces and some familiar points made during the debate. I shall seek to deal with with as many remarks as I can, and if I do not deal with them all it will be due to lack of time.
      If I cannot deal with all the matters raised by the hon. Member for Hackney, Central (Mr. Clinton Davis)—and those which are raised by the Law Society are particularly important—I shall write to him fully and make sure that the Law Society has a full answer. They are technical and important points on which there should be no lack of understanding by those who advise.
      This debate has fallen into three parts. The amendment of the hon. Member for Cornwall, North (Mr. Pardoe) dealt generally with the rent issue, as did many of
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      the speeches. Some more technical matters were raised by my hon. Friend the Member for Cities of London and Westminster (Mr. Tugendhat) and others, which I will deal with later. There was also the general question of house and land prices, which was dealt with by the right hon. Gentleman and others, and there was my hon. Friend's interesting point about council houses.
      I noted the Amendment tabled by the hon. Member for Putney (Mr. Hugh Jenkins), even though he did not have an opportunity to speak to it, which would forbid the sale of council houses at all. That is an interesting topic and one on which I know his views and I think he knows mine. Perhaps we can deal with that subject on another occasion.
      Finally, the debate dealt with the other important issue of local authority rents and in particular whether the Bill, when it becomes an Act, should be retrospectively validated for the purpose of catching the local authority October rent increases.
      I must make one general point before I dealt with rents in the private sector. We are dealing in the Bill with a 90-day freeze or standstill for the purpose of attacking inflation; this is a crucial objective but a limited one.
      Many of the suggestions made this afternoon would require major housing legislation regardless of their merits, and some have merits but others do not. Do hon. Members expect me, within nine days of taking office, to counter inflation by introducing proposals for a massive Housing Bill? Having endured most, but not all, of one massive Housing Bill, I had hoped to be allowed a week or two before starting the next!
      I am aware of the crucial problems in the private sector, such as security, levels of rent, furnished tenancies and so on, but it is essential while considering this 90-day Bill that nothing is done to hurt the long-term future of tenants and their houses. To put matters into perspective, we are concerned with between 2½ million and 3 million private tenancies. It is primarily for that sector that my right hon. and learned Friend proposes to introduce in due course and as appropriate orders to prevent increases of rent for the duration of the standstill.

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      By far the greater proportion of rents in the private sector are already frozen under one or other of the various provisions of the Rent Acts. Of the 2½ million to 3 million tenancies there are approximately 1·1 million controlled tenancies. Previous legislation provided two routes for the conversion of these controlled tenancies into regulated tenancies. The Government believe in the fair rent system principle, a belief shared by the Opposition since it was introduced in their Bill.
      In terms of numbers, the most important are those dealt with in Part IV of the Housing Finance Act which provides for general decontrol in a number of bands related to rateable values beginning January, 1973, and ending July, 1975. Under these provisions about 1 million controlled tenancies would in due course be converted, entitling landlords over a period of two years to seek a fair rent. The Government propose, for the duration of the standstill, to hold back the first phase of decontrol which might have affected about 150,000 tenancies. In effect, over 1 million controlled tenancy rents will remain frozen during the standstill period, as they have been since 1957. Rents for these properties are on average less than £1 a week, often for substantial accommodation.
      Hon. Members will have among their constituents landlords of these properties who often are among the poorer members of our society, such as retirement pensioners, who find it difficult to keep their property in decent repair. Hon. Members will be aware of the hardship which that has caused in the past for both the landlord and tenant. However, in the context of the standstill the Government believe the decision to be the right one.
      Apart from the 1·1 million controlled tenancies there are 1·2 million regulated tenancies. Under the Rent Acts a landlord could not increase the rent for such dwellings above the level of the rent in the existing contract or agreement. But the landlord can, if he wishes, go to the rent officer and ask for a fair rent to be registered. If a rent officer registers a fair rent higher than the existing rent the landlord may increase the rent up to the fair rent level. Registrations of fair rents are running at about 6,000 to 7,000 a month. But the landlord can charge the higher rent only when he has issued his tenant with a notice of increase. In the
      678
      normal way there will be very few rents—perhaps 20,000—for which there will be an increase over a 90-day period.
      The Government propose that for the 90 days standstill they should provide that, where a fair rent is registered during that period, the landlord will not be able to charge any resulting increase in the rent until the end of the period. Under Clause 2 (4) very substantial powers have been given to my right hon. and learned Friend, and therefore none of the amendments to enlarge those powers is necessary. For most private sector rents, no further standstill provisions are required. But there are many complex statutory provisions to which rents are subject.
      I confirm that both points mentioned by my hon. Friend the Member for Cities of London and Westminster and other hon. Members, and indeed by the hon. Member for Glasgow, Craigton (Mr. Millan) are covered. It is our intention to apply the 90-day standstill not only to controlled and regulated tenancies, except under the phasing provisions, but to the tenancies of unfurnished accommodation of the kind with which they are concerned.
      Mr. Freeson: I am still not clear about the position of that vast bulk of rents which can be referred to rent officers but which are not so referred, as the Minister knows. What will be the position there when rents are fixed freely because they are not referred to rent officers by landlords?
      Mr. Channon: The position is that in those circumstances a regulated rent can be increased only through the rent officer, and they are otherwise frozen at 1965 levels. If I have misunderstood the hon. Member's point I will write to him about it. That is what I understand the position to be and I have explained what will happen if people go to rent officers at present.
      There is a limited class of exceptions. They are the phasing exceptions, the 12½ per cent. exceptions—hon. Members will know the "shorthand"—those who had their property improved. Such an increase in rent reflects, not only a fall in the value of the landlord's rental income or any general movement in prices but an increase in the quality of accommodation being rented. If hon. Members would like to table detailed Questions

      679
      I will give them full answers, or the opportunity will arise when the order is made by my right hon. and learned Friend.
      Mr. John Horam: Is it correct that improved property is not frozen?
      Mr. Channon: Where a landlord of a controlled or regulated tenancy improves his property, he is entitled under the provisions of the Rent Act, 1968, to increase the rent on a yearly basis by 12½ per cent. of his net outlay. That is not frozen during the standstill period. There are other complications, and I will seek an opportunity of setting this out fully for the benefit of the Committee.
      The Government propose to apply the standstill to increases in the rents of housing association tenants, and I will give details of the methods at the appropriate time.
      All service charges for rented accommodation are subject to the standstill. Where the service charge is an integral part of a fair rent it is caught by the standstill on rent increases following the registration of a fair rent. Other service charges come within the scope of Clause 2(5) and my right hon. and learned Friend will not hesitate to make an order under this provision should he have any evidence that the standstill has been breached as regards service charges for rented dwellings.
      I do not believe that an extension of the Bill to cover the increase of land and house prices would be of benefit to house purchasers. As one of my hon. Friends pointed out, plots of land and houses are not standardised and easily priced articles like pairs of stocks. They are infinitely various. They cannot be priced on any standard basis with any hope of fairness. They can only be priced individually with reference to a highly sensitive relationship between supply and demand and the particular circumstances.
      6.45 p.m.
      As my hon. Friend the Member for Barry (Mr. Gower) pointed out, there is the further difficulty that for many plots of land and many houses there will be no obvious price, especially where the last sale took place a long time ago. Problems of this nature would affect particularly second-hand houses, which give
      680
      rise to most sales. One would have to fixed the theoretical level of market value for every land or house transaction caught by the control.
      The Committee must accept that this is wholly impracticable. The number of transactions is enormous. In 1971 there were upwards of three-quarters of a million sales of existing dwellings in owner-occupation. Is it really suggested that there should be a statutory control in this field? What would be the effect? The supply of land would dry up and so would the number of houses offered for sale. Surely the owners of actual or potential building land would hang on until the end of the restriction period before selling. This would have no immediate effect on the production of new houses, but a drop in the number of building sites offered for sale would surely undo much that all of us wish to see—the encouragement of the release of more housing land. I believe it would result in the completion of fewer new houses in a couple of years' time when the sites in question would normally be built upon.
      More important still, a similar situation would arise in the housing market. House sales are often made up of chains of transactions between buyers and sellers of existing and new houses and the first-time purchaser is often the last link in that chain. There are many existing owner-occupiers who would like to sell but who do not have to sell immediately. They, too, would defer selling until the end of the restriction period. There would be far fewer houses offered for sale. Who would suffer most? Surely in a situation of that kind it is those who are most exposed who would suffer most, and probably they would be first-time purchasers looking for homes. No one in this Committee would wish to be responsible for creating such a situation.
      The control of house prices would also penalise those who have to move immediately as against those who have some choice in the timing of their moves. That would be very unfair. An interesting suggestion has been made, which I shall consider, but every previous Administration has taken the same view. I have a sheaf of quotations. My predecessor was particularly fond of quoting Mr. Aneurin Bevan and, were I to follow his example, I could make a quotation from Mr. Aneurin Bevan also this evening.

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      More pertinent to the Committee, the right hon. Member for Coventry, East (Mr. Crossman), when he was Minister of Housing, took precisely the same view. I am sorry that the right hon. Member for Grimsby feels that that is not a particularly valuable point to make, but it is one I think I am entitled to make and the House must take it for what it is worth.
      I must take up the right hon. Member for Grimsby on one point he raised when he refused to give way to my hon. Friend the Chief Secretary about the taxation of speculative profits in land. The right hon. Gentleman was asked to define such speculative profits and he instanced the case of a man buying land as a speculation and selling it at a huge profit. Such a man, he said, ought to pay more than the 30 per cent. capital gains tax and it was at that point, perhaps wisely, that the right hon. Member refused to give way again.
      The truth is that such a man, so far from paying only 30 per cent. capital gains tax, pays full income tax and surtax on such a gain. Profits from speculative transactions of that sort are treated as income within the Income Tax Acts and are fully taxed as such—not just capital gains tax, but full income and surtax. If it is a company which speculates, the profit is subject to corporation tax and, when distributed, to personal tax as well. The owner of a one-man property-speculating company will not escape by selling his shares, because he will be caught for full income tax and surtax on his profits. Nor will he escape by setting up trusts or settlements or by indulging in other avoidance devices. Legislation passed by the last Government, and supported by this side of the Committee, catches such transactions and the right hon. Gentleman is being disingenuous to suggest imposing a special rate of capital gains tax. I have the full authority of my hon. Friend the Chief Secretary for making this statement. This is the taxation position in respect of the fruits of property speculation of the kind referred to by the right hon. Gentleman.
      Mr. Freeson: On paper.
      Mr. Channon: Not only on paper, but in fact.
      I now turn to the questions raised by Opposition Members about the Housing
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      Finance Act. However, in order not to create ill will on my first day in addressing the Committee, I should like first to offer the hon. Member for Salford, East (Mr. Frank Allaun) an apology for not giving him a fuller answer to his question yesterday. I shall try to do so in future, and I have taken note of his Early Day Motion.
      The right hon. Member for Grimsby did not disguise that the amendment is an attack on the increases in council rents required by the Housing Finance Act. As he will know, the date of 1st October had no significance with regard to rents in the private sector, but according to the terms of the Act those authorities which did not make an increase in April were required to do so in October unless—as was the case with a few authorities—special arrangements had been made between the two dates.
      It is interesting that the right hon. Gentleman should have reverted to 1st October in respect of council rents but not in relation to other factors—for example, wages and salaries. Common sense demands that a standstill, if applied, must apply in every case from a common date. Any other arrangement would surely be wholly indefensible. [HON. MEMBERS: "No."] It would be unfair in all respects. For example, it would be unfair to those tenants whose rents were increased in April if tenants of authorities which had imposed increases in October had that increase rescinded.
      I should add that during the 1968 freeze the Opposition did not go so far as to prevent increases in the rents of council dwellings. On the contrary, they were quite prepared to permit local authorities to increase their rents by an average of 37½p. Therefore, it is wholly inconsistent and hypocritical that they should be pressing us now to impose a complete freeze—
      Mr. Frank Allaun Mr. Frank Allaun rose—
      Mr. Channon: I cannot give way: I have only three minutes. It is hypocritical that they should be asking for a complete freeze to be achieved by a piece of retrospection uniquely aimed at council rents. It is time that the Committee took account of the actual effects of the Housing Finance Act rather than that we should rely on imaginary fears. From

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      what has been said by Opposition Members, one might have had the impression that every council tenant as from October had been required to pay a rent increase of £1. In fact, about half the number of council tenants suffered no increase of rents in October, while only one tenant in five has had to pay an increase of as much as £1. Therefore, a large proportion of tenants paid no increase in October while a great many paid increases of less than £1 at that date. A very large number of all those tenants have received rebates.
      Opposition Members who make such a fuss about the Housing Finance Act tend conveniently to forget the national system of rent rebates which the Act introduces—[Interruption.] I notice that they try to decry it, but they do not seek to freeze that part of the Act. For the first time, any council tenant who has difficulty in affording his rent can apply for a rebate. There are many people who are now paying out of their own pocket less rent than they have hitherto paid. Many others are paying only a fraction of the nominal increase in their rent. For example, the rebate scheme which the Greater London Council used to operate was generally considered to have been a very good scheme. However, the GLC under our scheme expects to be paying rebates to 9,000 more tenants than previously.
      The Labour Party is not interested in the real situation or the Housing Finance Act. It is interested only in building up its hysterical and misguided campaign to try to mislead council tenants—a campaign which, as is becoming increasingly clear, has wholly backfired as people begin to realise the truth about the Act. Every tenant in unfurnished housing accommodation will in future be part of the national rent rebate and allowance scheme. The same will apply from April in respect of furnished tenants. All rents will be fixed on the same equitable basis, and there will be rebates and allowances for those unable to afford them. Help
      and subsidies are devoted to those in need. Surely any fair-minded person would accept that those aims are extremely desirable. The Government will not be diverted from this course. We believe it is in the best interests of housing and of all who are involved in this sector.
      I ask the Committee to reject all the Opposition amendments, because I genuinely believe that in the interests of tenants, local authority or private, and of prospective owner-occupiers it would be wholly disastrous to adopt the course suggested. I ask my hon. Friends to support me in the Division Lobby.
      Mr. Pardoe: The Minister must be congratulated on at least having attracted into the Chamber the Secretary of State and on having made the benches behind him more densely populated than they have been throughout the afternoon. His reply on rents was totally inadequate. It reminds me of the music-hall comedian who, having deducted Saturdays and Sundays, nights and holidays, said, "We work only 18 days." By the time the Minister had finished talking about rents, there appeared to be about only two and a half tenants who would have their rents raised in the 90 days.
      The answer on land prices was the same as that which we have always had: "It is very sad. We are terribly sorry, land prices are going up and up and up, but what we can we do?" We have "What can we do?—Channon" instead of "What can we do?—Walker". At the beginning of the debate I posed the vital question: does the Bill freeze rents or does it not? We have had the answer in the Minister's reply. It does not. Therefore, I have no intention of seeking leave to withdraw our Amendment.
      Question put, That the Amendment be made:—
      The Committee divided: Ayes 274, Noes 293.

      Division No. 12.]

      AYES

      [6.58 p.m.

      Abse, Leo

      Barnes, Michael

      Bishop, E. S.

      Allaun, Frank (Salford, E.)

      Barnett, Guy (Greenwich)

      Blenkinsop, Arthur

      Allen, Scholefield

      Barnett, Joel (Heywood and Royton)

      Boardman, H. (Leigh)

      Archer, Peter (Rowley Regis)

      Baxter, William

      Booth, Albert

      Ashley, Jack

      Beaney, Alan

      Bottomley, Rt. Hn. Arthur

      Ashton, Joe

      Benn, Rt. Hn. Anthony Wedgwood

      Boyden, James (Bishop Auckland)

      Atkinson, Norman

      Bennett, James (Glasgow, Bridgeton)

      Bradley, Tom

      Bagier, Gordon A. T.

      Bidwell, Sydney

      Brown, Robert C. (Nc'tle-u-Tyne,W.)

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

      Hilton, W. S.

      Owen, Dr. David (Plymouth, Sutton)

      Brown, Ronald(Shoreditch & F'bury)

      Horam, John

      Padley, Walter

      Buchan, Norman

      Houghton, Rt. Hn. Douglas

      Paget, R. T.

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

      Huckfield, Leslie

      Palmer, Arthur

      Butler, Mrs. Joyce (Wood Green)

      Hughes, Rt. Hn. Cledwyn (Anglesey)

      Pannell, Rt. Hn. Charles

      Callaghan, Rt. Hn. James

      Hughes, Mark (Durham)

      Parker, John (Dagenham)

      Campbell, I. (Dunbartonshire, W.)

      Hughes, Robert (Aberdeen, N.)

      Parry, Robert (Liverpool, Exchange)

      Cant, R. B.

      Hughes, Roy (Newport)

      Peart, Rt. Hn. Fred

      Carmichael, Neil

      Hunter, Adam

      Pendry, Tom

      Carter, Ray (Birmingh'm, Northfield

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

      Perry, Ernest G.

      Carter-Jones, Lewis (Eccles)

      Janner, Greville

      Prentice, Rt. Hn. Reg

      Castle, Rt. Hn. Barbara

      Jay, Rt. Hn. Douglas

      Prescott, John

      Clark, David (Colne Valley)

      Jenkins, Hugh (Putney)

      Price, J. T. (Westhoughton)

      Cocks, Michael (Bristol, S.)

      Jenkins, Rt. Hn. Roy (Stechford)

      Price, William (Rugby)

      Cohen, Stanley

      John, Brynmor

      Probert, Arthur

      Coleman, Donald

      Johnson, Carol (Lewisham, S.)

      Reed, D. (Sedgefield)

      Concannon, J. D.

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

      Rees, Merlyn (Leeds, S.)

      Conlan, Bernard

      Johnson, Walter (Derby, S.)

      Rhodes, Geoffrey

      Corbet, Mrs. Freda

      Johnston, Russell (Inverness)

      Richard, Ivor

      Cox, Thomas (Wandsworth, C.)

      Jones, Barry (Flint, E.)

      Roberts, Albert (Normanton)

      Cronin, John

      Jones, Dan (Burnley)

      Roberts, Rt. Hn. Goronwy(Caernarvon)

      Crosland, Rt. Hn. Anthony

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

      Robertson, John (Paisley)

      Crossman, Rt. Hn. Richard

      Jones, Gwynoro (Carmarthen)

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

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

      Kaufman, Gerald

      Rodgers, William (Stockton-on-Tees)

      Cunningham, Dr. J. A. (Whitehaven)

      Kelley, Richard

      Roper, John

      Dalyell, Tam

      Kerr, Russell

      Rose, Paul B.

      Darling, Rt. Hn. George

      Kinnock, Neil

      Ross, Rt. Hn. William (Kilmarnock)

      Davidson, Arthur

      Lambie, David

      Rowlands, Ted

      Davies, Denzil (Llanelly)

      Lambourn, Harry

      Sandelson, Neville

      Davies, G. Elfed (Rhondda, E.)

      Lamond, James

      Sheldon, Robert (Ashton-under-Lyne)

      Davies, Ifor (Gower)

      Latham, Arthur

      Shore, Rt. Hn. Peter (Stepney)

      Davis, Clinton (Hackney, C.)

      Lawson, George

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

      Davis, Terry (Bromsgrove)

      Leadbitter, Ted

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

      Deakins, Eric

      Lee, Rt. Hn. Frederick

      Silkin, Rt. Hn. John (Deptford)

      de Freitas, Rt. Hn. Sir Geoffrey

      Leonard, Dick

      Silkin, Hn. S. C. (Dulwich)

      Delargy, Hugh

      Lestor, Miss Joan

      Sillars, James

      Dell, Rt. Hn. Edmund

      Lewis, Arthur (W. Ham, N.)

      Silverman, Julius

      Dempsey, James

      Lewis, Ron (Carlisle)

      Skinner, Dennis

      Doig, Peter

      Lipton, Marcus

      Small, William

      Dormand, J. D.

      Lomas, Kenneth

      Smith, Cyril (Rochdale)

      Douglas, Dick (Stirlingshire, E.)

      Loughlin, Charles

      Smith, John (Lanarkshire, N.)

      Douglas-Mann Bruce

      Lyon, Alexander W. (York)

      Spearing, Nigel

      Duffy, A. E. P.

      Lyons, Edward (Bradford, E.)

      Spriggs, Leslie

      Dunn, James A.

      Mabon, Dr. J. Dickson

      Stallard, A. W.

      Dunnett, Jack

      McBride, Neil

      Stewart, Donald (Western Isles)

      Eadie, Alex

      McCartney, Hugh

      Stewart, Rt. Hn. Michael (Fulham)

      Edelman, Maurice

      McElhone, Frank

      Stoddart, David (swindon)

      Edwards, Robert (Bilston)

      McGuire, Michael

      Stonehouse, Rt. Hn. John

      Edwards, William (Merioneth)

      Mackenzie, Gregor

      Strang, Gavin

      English, Michael

      Mackie, John

      Strauss, Rt. Hn. G. R.

      Evans, Fred

      Mackintosh, John P.

      Summerskill, Hn. Dr. Shirley

      Ewing, Harry

      Maclennan, Robert

      Swain, Thomas

      Faulds, Andrew

      McMillan, Tom (Glasgow, C.)

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

      Fernyhough, Rt. Hn. E.

      McNamara, J. Kevin

      Thomas, Jeffrey (Abertillery)

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

      Mahon, Simon (Bootle)

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

      Fletcher, Raymond (Ilkeston)

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

      Thorpe, Rt. Hn. Jeremy

      Fletcher, Ted (Darlington)

      Marks, Kenneth

      Tinn, James

      Foley, Maurice

      Marquand, David

      Tomney, Frank

      Foot, Michael

      Marsden, F.

      Torney, Tom

      Ford, Ben

      Marshall, Dr. Edmund

      Tuck, Raphael

      Forrester, John

      Mason, Rt. Hn. Roy

      Urwin, T. W.

      Fraser, John (Norwood)

      Mayhew, Christopher

      Varley, Eric G.

      Freeson, Reginald

      Meacher, Michael

      Wainwright, Edwin

      Galpern, Sir Myer

      Mellish, Rt. Hn. Robet

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

      Garrett, W. E.

      Mendelson, John

      Walker, Harold (Doncaster)

      Gilbert, Dr. John

      Mikardo, Ian

      Watkins, David

      Ginsburg, David (Dewsbury)

      Millan, Bruce

      Weitzman, David

      Golding, John

      Miller, Dr. M. S.

      Wellbeloved, James

      Gourlay, Harry

      Milne, Edward

      Wells, William (Walsall, N.)

      Grant, George (Morpeth)

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

      White, James (Glasgow, Pollok)

      Grant, John D. (Islington, E.)

      Molloy, William

      Whitehead, Phillip

      Griffiths, Eddie (Brightside)

      Morgan, Elystan (Cardiganshire)

      Whitlock, William

      Griffiths, Will (Exchange)

      Morris, Alfred (Wythenshawe)

      Willey, Rt. Hn. Frederick

      Grimond, Rt. Hn. J.

      Morris, Charles R. (Openshaw)

      Williams, Alan (Swansea, W.)

      Hamilton, James (Bothwell)

      Moyle, Roland

      Williams, Mrs. Shirley (Hitchin)

      Hamilton, William (Fife, W.)

      Mulley, Rt. Hn. Frederick

      Williams, W. T. (Warrington)

      Hamling, William

      Murray, Ronald King

      Wilson, Alexander (Hamilton)

      Hannan, William (G'gow, Maryhill)

      Oakes, Gordon

      Wilson, Rt. Hn. Harold (Huyton)

      Hardy, Peter

      Ogden, Eric

      Wilson, William (Coventry, S.)

      Harper, Joseph

      O'Halloran, Michael

      Woof, Robert

      Harrison, Walter (Wakefield)

      O'Malley, Brian

      Hart, Rt. Hn. Judith

      Oram, Bert

      TELLERS FOR THE AYES:

      Hattersley, Roy

      Orbach, Maurice

      Mr. David Steel and

      Healey, Rt. Hn. Denis

      Orme, Stanley

      Mr. John Pardoe

      Heffer, Eric S.

      Oswald, Thomas

      686

      687

      NOES

      Adley, Robert

      Fookes, Miss Janet

      McCrindle, R. A.

      Alison, Michael (Barkston Ash)

      Fortescue, Tim

      McLaren, Martin

      Allason, James (Hemel Hempstead)

      Foster, Sir John

      Maclean, Sir Fitzroy

      Amery, Rt. Kn. Julian

      Fowler, Norman

      McMaster, Stanley

      Archer, Jeffrey (Louth)

      Fry, Peter

      Macmillan, Rt.Hn.Maurice(Farnham)

      Astor, John

      Galbraith, Hn. T. G. D.

      McNair-Wilson, Michael

      Atkins, Humphrey

      Gardner, Edward

      McNair-Wilson, Patrick (New Forest)

      Awdry, Daniel

      Gibson-Watt, David

      Maddan, Martin

      Baker, Kenneth (St. Marylebone)

      Gilmour, Ian (Norfolk, C.)

      Madel, David

      Baker, W. H. K. (Banff)

      Gilmour, Sir John (Fife, E.)

      Marten, Neil

      Balniel, Rt. Hn. Lord

      Glyn, Dr. Alan

      Mather, Carol

      Barber, Rt. Hn. Anthony

      Godber, Rt. Hn. J. B.

      Maude, Angus

      Batsford, Brian

      Goodhart, Philip

      Maudling, Rt. Hn. Reginald

      Beamish, Col. Sir Tufton

      Gorst, John

      Mawby, Ray

      Bennett, Sir Frederic (Torquay)

      Gower, Raymond

      Maxwell-Hyslop, R. J.

      Benyon, W.

      Grant, Anthony (Harrow, C.)

      Meyer, Sir Anthony

      Biffen, John

      Gray, Hamish

      Mills, Stratton (Belfast, N.)

      Biggs-Davison. John

      Green, Alan

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

      Blaker, Peter

      Grieve, Percy

      Mitchell, David (Basingstoke)

      Boardman, Tom (Leicester, S.W.)

      Griffiths, Eldon (Bury St. Edmunds)

      Moate, Roger

      Body, Richard

      Grylls, Michael

      Molyneaux, James

      Boscawen, Hn. Robert

      Gummer, J. Selwyn

      Money, Ernie

      Bossom, Sir Clive

      Gurden, Harold

      Monks, Mrs. Connie

      Bowden, Andrew

      Hall, Miss Joan (Keighley)

      Monro, Hector

      Braine, Sir Bernard

      Hall, John (Wycombe)

      Montgomery, Fergus

      Bray, Ronald

      Hall-Davis, A. G. F.

      More, Jasper

      Brewis, John

      Hamilton, Michael (Salisbury)

      Morgan-Giles, Rear-Adm.

      Brinton Sir Tatton

      Hannam, John (Exeter)

      Morrison, Charles

      Brocklebank-Fowler, Christopher

      Harrison, Brian (Maldon)

      Mudd, David

      Brown, Sir Edward (Bath)

      Harrison, Col. Sir Harwood (Eye)

      Murton, Oscar

      Bruce-Gardyne, J.

      Haselhurst, Alan

      Nabarro, Sir Gerald

      Bryan, Sir Paul

      Hastings, Stephen

      Neave, Airey

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

      Havers, Sir Michael

      Nicholls, Sir Harmar

      Buck, Antony

      Hawkins, Paul

      Noble, Rt. Hn. Michael

      Bullus, Sir Eric

      Hay, John

      Nott, John

      Burden, F. A.

      Hayhoe, Barney

      Onslow, Cranley

      Butler Adam (Bosworth)

      Heseltine, Michael

      Oppenheim, Mrs. Sally

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

      Hicks, Robert

      Orr, Capt. L. P. S.

      Carlisle, Mark

      Higgins, Terence L.

      Osborn, John

      Carr, Rt. Hn. Robert

      Hiley, Joseph

      Owen, Idris (Stockport, N.)

      Cary, Sir Robert

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

      Page, Rt. Kn. Graham (Crosby)

      Channon, Paul

      Hill, James (Southampton, Test)

      Page, John (Harrow, W.)

      Chapman, Sydney

      Holland, Philip

      Parkinson, Cecil

      Chataway, Rt. Hn. Christopher

      Holt, Miss Mary

      Peel, John

      Chichester-Clark, R.

      Hordern, Peter

      Percival, Ian

      Churchill, W. S.

      Hornby, Richard

      Pike, Miss Mervyn

      Clark, William (Surrey, E.)

      Hornsby-Smith, Rt.Hn.Dame Patricia

      Pink, R. Bonner

      Clarke, Kenneth (Rushcliffe)

      Howe, Hn. Sir Geoffrey (Reigate)

      Pounder, Rafton

      Clegg, Walter

      Howell, David (Guildford)

      Price, David (Eastleigh)

      Cockeram, Eric

      Howell. Ralph (Norfolk, N.)

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

      Cooke, Robert

      Hunt, John

      Proudfoot, Wilfred

      Coombs, Derek

      Hutchison, Michael Clark

      Fym, Rt. Hn. Francis

      Cooper, A. E.

      Iremonger, T. L.

      Raison, Timothy

      Cordle, John

      Irvine, Bryant Godman (Rye)

      Ramsden, Rt. Hn. James

      Corfield, Rt. Hn. Sir Frederick

      James, David

      Redmond, Robert

      Cormack, Patrick

      Jenkin, Patrick (Woodford)

      Reed, Laurance (Bolton, E.)

      Costain, A. P.

      Jennings, J. C. (Burton)

      Rees, Peter (Dover)

      Critchley, Julian

      Jessel, Toby

      Rees-Davies, W. R.

      Crouch, David

      Johnson Smith, G. (E. Grinstead)

      Renton, Rt. Hn. Sir David

      Crowder, F. P.

      Jones, Arthur (Northants, S.)

      Rhys Williams, Sir Brandon

      Dalkeith, Earl of

      Jopling, Michael

      Ridley, Hn. Nicholas

      Davies, Rt. Hn. John (Knutsford)

      Joseph, Rt. Hn. Sir Keith

      Ridsdale, Julian

      d'Avigdor-Goldsmid, Sir Henry

      Keberry, Sir Donald

      Rippon, Rt. Hn. Geoffrey

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

      Kellett-Bowman, Mrs. Elaine

      Roberts, Michael (Cardiff, N.)

      Dean, Paul

      Kershaw, Anthony

      Roberts, Wyn (Conway)

      Deedes, Rt. Hn. W. F.

      Kilfedder, James

      Rodgers, Sir John (Sevenoaks)

      Digby, Simon Wingfield

      Kimball. Marcus

      Rossi, Hugh (Hornsey)

      Dixon, Piers

      King, Evelyn (Dorset, S.)

      Rost, Peter

      Dodds-Parker, Douglas

      King, Tom (Bridgwater)

      Russell, Sir Ronald

      Douglas-Home Rt. Hn. Sir Alec

      Kinsey, J. R.

      St. John-Stevas, Norman

      Drayson, G. B.

      Kirk, Peter

      Scott, Nicholas

      du Cann, Rt. Hn. Edward

      Knight, Mrs. Jill

      Dykes, Hugh

      Knox, David

      Scott-Hopkins, James

      Lambton, Lord

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

      Eden, Rt. Hn. Sir John

      Lamont. Norman

      Shelton, William (Clapham)

      Edwards, Nicholas (Pembroke)

      Lane, David

      Simeons, Charles

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

      Langford-Holt, Sir John

      Sinclair, Sir George

      Eyre, Reginald

      Le Marchant, Spencer

      Skeet, T. H. H.

      Farr, John

      Lewis, Kenneth (Rutland)

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

      Fell, Anthony

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

      Soref, Harold

      Fenner, Mrs. Peggy

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

      Speed, Keith

      Fidler, Michael

      Loveridge, John

      Spence, John

      Finsberg, Geoffrey (Hampstead)

      Luce, R. N.

      Sproat, Iain

      Fietcher-Cooke, Charles

      MacArthur, Ian

      Stainton, Keith

      688

      689

      Stanbrook, Ivor

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

      White, Roger (Gravesend)

      Stewart-Smith, Geoffrey (Belper)

      Thompson, Sir Richard (Croydon, S.)

      Wiggin, Jerry

      Stodart, Anthony (Edinburgh, W.)

      Tilney, John

      Wilkinson, John

      Stoddart-Scott, Col. Sir M.

      Trew, Peter

      Winterton, Nicholas

      Stokes, John

      Tugendhat, Christopher

      Wolrige-Gordon, Patrick

      Stuttaford, Dr. Tom

      Turton, Rt. Hn. Sir Robin

      Wood, Rt. Hn. Richard

      Sutcliffe, John

      van Straubenzee, W. R.

      Woodhouse, Hn. Christopher

      Tapsell, Peter

      Vaughan, Dr. Gerard

      Woodnutt, Mark

      Taylor, Sir Charles (Eastbourne)

      Vickers, Dame Joan

      Worsley, Marcus

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

      Walder, David (Clitheroe)

      Wylie, Rt. Hn. N. R.

      Taylor, Frank (Moss Side)

      Walker-Smith, Rt. Hn. Sir Derek

      Younger, Hn. George

      Taylor, Robert (Croydon, N.W.)

      Wall, Patrick

      Tebbit, Norman

      Walters, Dennis

      TELLERS FOR THE NOES:

      Temple, John M.

      Warren, Kenneth

      Mr. Victor Goodhew and

      Thatcher, Rt. Hn. Mrs. Margaret

      Weatherill, Bernard

      Mr. Marcus Fox

      Thomas, John Stradling (Monmouth)

      Wells, John (Maidstone)

      Question accordingly negatived.
      It being after Seven o'clock, The CHAIRMAN proceeded pursuant to Order [14th November] to put forthwith the Questions necessary for the disposal of the Business to be concluded at that hour.
      Clause 2 ordered to stand part of the Bill.
      Clause 3 ordered to stand part of the Bill.

    Clause 4

      POWER TO OBTAIN INFORMATION
      Mr. Peter Rees: I beg to move Amendment No. 39, in page 3, line 16, after 'information', insert:
      'as may reasonably be required for the purposes of this Act and'.
      The Second Deputy Chairman: We can also discuss Amendment No. 40, in page 3, line 19, after 'documents', insert:
      'which may reasonably be required for the purposes of this Act'.
      Mr. Rees: Clause 4 is designed to equip the Executive with far-reaching powers to require employers or trade unions
      "(a) to furnish to the appropriate Minister such estimates, returns or other information as may be specified … or
      (b) to produce to an officer of the appropriate Minister, duly authorised for the purpose, any documents so specified or authorised."
      If the Bill is to be sharp and effective, it is right that the Government should be equipped with effective powers. No one would question that. I want to see the Bill sharp, short and effective, but in any case it is necessary to see that the Executive is not equipped with powers greater
      690
      than necessary and that the subject has the right to challenge the exercise of those powers in the courts. I hope that that is a proposition which commends itself to both sides of the Committee.
      Subsection (1) equips the Executive with very wide powers and, beyond that, the powers are not subject to serious challenge in the courts; and this Amendment is designed to remedy that. It is not necessary to imagine fanciful situations where my right hon. and learned Friend might require a managing director to produce his grandmother's birth certificate. But, in a more serious vein, it is possible to envisage situations where he might require a company or a trade union to produce all its books of accounts, records, correspondence, and so on. That would be oppressive and vexatious in the extreme, and the subject would have no right of recourse to the courts to challenge the reasonableness of the request because, no such right is written into the clause; it is merely a question of the Minister specifying the documents required.
      As I understand the clause—and I hope my right hon. and learned Friend will be able to allay my doubts—a subject in that situation would have no right to go to the courts and say that that was an unreasonable exercise of the powers and that the documents and records required were irrelevant for the purposes of the Act.
      The subsections have an old but not exactly respectable precedent. The subsection derives from a schedule to the Prices and Incomes Act, 1966, which hardly commends it to me, and there are certain echoes of these provisions in the value added tax legislation. The Executive has been over-prone of late to take to itself this kind of power. In Clause 2(7) the Minister has taken a kind of

      691
      dispensing power to himself—a blanket provision with regard to dividends, wages, and prices—so that he may give his consent in writing to something which would otherwise be illegal.
      Our ancestors debated the propriety of the Executive taking dispensing powers in the seventeenth century and I do not want to reopen that old constitutional issue, but I think it is right to draw attention to a situation in which a subject may be put to considerable inconvenience and expense to no great purpose.
      All I have said is subject to Clause 4(2), which is a curious and obscure provision, and which, again, I imagine derives from the 1966 Act. One can understand that under the pressures which attended the gestation of the Bill there was not time to give serious consideration to this type of point. Subsection (2) provides:
      "No person shall be compelled, in complying with any such notice, to give any information which he could not be compelled to give in evidence in proceedings before the High Court."
      It strikes me—I hope that my right hon. and learned Friend will be able to put a different construction on it—that this either will render Clause 4(1) nugatory or may be an ineffective safeguard for the subject. Perhaps the Committee will allow me to elaborate on that.
      If it means that the subject can refuse to disclose the information or documents required on the ground that it might incriminate him in criminal proceedings, it must render the Clause largely ineffective because all the contraventions of the legislation are made criminal offences and there are criminal penalties to be imposed. If that construction is put on subsection (2), a trade unionist or an employer has only to say, "I decline to produce these documents and I decline to give this information because it might incriminate me in criminal proceedings which the Minister may bring."
      If, on the other hand, it is not to have that construction but means that documents or information, which would be privileged in normal civil proceedings, need not be disclosed, it is largely ineffective as regards the subject, because it excludes from the ambit of the Minister's powers only confidential communications
      692
      between, say, an employer or trade union and their professional advisers. Here is a considerable area of doubt which I hope that my right hon. and learned Friend will be able to clarify. It would be pedantic for me to suggest that, with his well-known antecedents, he would require the assistance of a Law Officer to elucidate this point to the satisfaction of the Committee, but I hope that he can give some comfort and help.
      I appreciate that in the time available my right hon. and learned Friend and other members of the Government who produced the Bill did not perhaps have time to produce a highly tempered instrument designed to cover every situation that might be affected by it. Indeed, I recognise that the Bill must be a blunt instrument which perhaps will not be wielded for long. But because it is a blunt instrument and because it is designed to be brutal and effective, it is right to ask the Government to equip themselves with minimum powers and give some evidence that they will wield these powers with the maximum deference to and consideration for the subject.
      7.15 p.m.
      Mr. Peter Trew: I should like to speak in support of my hon. and learned Friend the Member for Dover (Mr. Peter Rees) who, in raising this matter, has done a service to the Committee.
      Clause 4(1), which would be affected by the amendments, is reminiscent of the enforcement provisions of the VAT legislation, which caused great concern throughout the whole of the legal profession, and which the Government quite rightly modified in Standing Committee and on Report. There seems to be a tendency in financial legislation, a tendency that is underlined in the Bill, to take more stringent powers on behalf of the Executive than are strictly necessary for the execution of its duties.
      My hon. and learned Friend said that because this is a Bill for temporary measures it can be said that it has been hastily drafted and has stronger powers than are strictly required. The principle that governs all legislation should be that the liberty of the subject must take precedence over the convenience of the bureaucracy. We should like to be assured that in the implementation of the Clause the Executive will not ask for any

      693
      information which is not reasonably required under the Act.
      Mr. John Biffen: It would not need very much extra-sensory perception to conclude that we are unlikely to have a lengthy debate on the schedule because of the guillotine. Therefore, the arguments just elaborated by my right hon. and learned Friend the Member for Dover (Mr. Peter Rees) provide a useful opportunity for the Committee to ask the Government how they will use the powers contained in Clause 4. Paragraph 1(1) of the schedule says:
      "An order or notice under section 2 of this Act may be framed in any way whatsoever, may prescribe any method of comparing prices, charges, rates of remuneration, dividends or rents, and may define any expression used in those sections (other than an expression defined by section 8 of this Act)."
      Let the Committee be in no doubt or hesitation that that confers on the Government, albeit for a limited period, the most extensive powers. It is almost a peace-time edition of Defence Regulation 18B in a commercial and trading sense.
      The anxieties expressed by my hon. and learned Friend the Member for Dover, and re-echoed by my hon. Friend the Member for Dartford (Mr. Trew), are fair and real. It is not that we have any lack of faith in the sensible way in which my right hon. and learned Friend will proceed, although bureaucracies have an ability to self-perpetuation, even beyond the day-to-day control and supervision of a presiding Minister. Therefore, it is important that this Parliament is making its first essay in legislation to control incomes and prices.
      Do not let us be deceived by the temporary nature of the Bill into assuming that there will be no subsequent essays. That is what makes it particularly important to know exactly how my right hon. and learned Friend intends to use the vast powers that are conferred on him in Clause 4 and the wide-ranging responsibilities that he assumes under paragraph 1 of the schedule.
      If in refining the requirements and in elaborating the somewhat sketchy outline of the policy contained in the White Paper my right hon. and learned Friend feels disposed to give subsequent guidelines, the Committee would like to enjoy
      694
      parity of information with whatever trade associations were informed on this issue. This is important because the Government must be relying substantially upon publicity for the execution of this temporary policy, and Parliament must have at least its equal share in that publicity.
      My whole feeling about this piece of legislation, distasteful as it is, is that it is unlikely ever to be used in reality. I find it difficult to believe that an order will ever be made. If it is made and subsequently challenged, the Attorney-General will never put that challenge to the test in the law courts. I believe that this is essentially a public relations Bill to cover a temporary situation. In saying that I am not saying anything of marked hostility towards the Treasury Bench. But we hold it in trust, as legislators, to look carefully at what we put on the Statute Book even if only for 90 days, 150 days, or whatever the case may be.
      My hon. and learned Friend may draw upon his wide-ranging commercial experience to realise the serious difficulties that can be laid upon a company which feels itself obliged to reveal information which is detrimental to its whole commercial trading. The same argument may apply to those engaged in the trade union movement.
      This is an area where, although we may give a charitable nod to my right hon. and learned Friend, the House needs the most careful and categorical assurance that these powers will only be used in the most restricted sense, that it will be the wish of my right hon. and learned Friend to exercise the authority invested in him by Clause 4 of the Bill to the very minimum, and that throughout the entire proceedings Parliament will be kept fully informed.
      Mr. Arthur Lewis: I feel somewhat like the hon. Member for Oswestry (Mr. Biffen). I think that this whole business is a bit of a charade. The Government have no intention of being tough about prices. Regardless of whether the amendment is accepted and whether the clause stands part of the Bill, the Government have proved over the past 2½ years that when it comes to taking action against the trade unions they can act with vigour and with speed, and they can be, and are,

      695
      vicious in seeing that the law is carried out.
      The five dockers is one example; the Hugh Scanlon affair is another. We know in this House that normally the law could take years before it gets cracking on an issue. The thalidomide babies are a good example. With the aid and support of the Government, the law will not move at all if the Government do not want it to move. Of course, when the Government want it to move against the trade unions it can get cracking, within days, indeed within hours, to show the viciousness and the unfairness of our legal system against the poorer sections of the population. One famous Member of this House said something to the effect that if one had enough money one could buy justice. I agree that that is true. If a person has money he can have justice.
      Without the amendment, the clause reads:
      "to furnish to the appropriate Minister such estimates, returns or other information",
      and so on. We have the Companies Act, and year after year unscrupulous company directors have been fleecing the public. What they have done has been inflationary. This Government refused to take any action, although by Statute they should have done so. Hon. Members on both sides of the committee have given examples of cases where companies, quite illegally, have not been holding their annual meetings, have not been sending in their annual returns, have not had properly elected directors, and have not had properly audited accounts. The Department of Trade and Industry has consistently refused to take any action. We even had the anachronistic situation where a man in gaol was allowed to run his company even though he was a convicted criminal. I believe there was even a case where a man floated a company while he was in gaol.
      I am glad to see the former Solicitor-General here, because he now has the job of dealing with these matters. I hope he looks up the files. There are about 200 cases in his office at the moment of companies that have fleeced the public of hundreds of millions of pounds. The Government have done nothing. They have known about it. They have allowed the criminals to get away to Australia, running away with £4 million
      696
      Robbed from the hard-working investing public.
      If one asks the Minister to take action he does nothing. I can mention the Pin-flock case. A director of that company flitted with £4 million, but for four years before he went the Department was asked to take action and did nothing. Then we had the John Bloom fiasco and the Dollar Land affair. I could go on for two or three weeks giving all the details. Here the Government are saying that they want to have power to furnish themselves with information. What a farce! They are to have a system of telephone calls to the Ministry. We all know what will happen. Even a Member of Parliament cannot get an answer before several weeks elapse if he telephones to ask an urgent question. As for writing, I do not know what the experience of hon. Members on either side of the House is, but my own is that if I write on an urgent matter I possibly get a printed acknowledgment after a fortnight or three weeks saying that the matter is receiving attention, assuming that I am lucky. After another couple of weeks, I receive a letter saying that my original inquiry has been sent on to some other Department, and after another six or seven weeks, again if I am lucky, I might get an answer saying that today is Thursday, 16th November, and, of course, the information was known six or seven weeks earlier. The Department concerned could have sent the information and taken action but this Government's attitude has been: do nothing, let it find its own level, brush it under the carpet, forget it, and hope that nothing will come of it.
      [Sir ROBERT GRANT-FERRIS in the Chair]
      7.30 p.m.
      I do not see how the amendment will make any difference. I cannot envisage what will happen. But I have had experience of these things, and what I am saying is not guesswork. The present Government, the most lethargic Government we have had—with hundreds and hundreds more civil servants, incidentally—give prompt attention only to appointing their friends and supporters to big jobs at big salaries, and they make sure that those salaries are effective before the freeze becomes effective.

      697
      I read in the Daily Express in the last day or two that the Government are to appoint Sir Con O'Neill to a nice fat job as recompense for his services in pushing Britain into the Common Market. The Government have not told the House about it, but they have promised him a job at £7,000 to £8,000 a year. I telephoned to ask about this, but I was given no information. When I threatened to raise the matter on the Floor of the House, I was told that the Minister of Agriculture does not intend to announce it until the end of the month, or probably the beginning of next month—that is, not until the Bill has gone through—because there might be something of a public outcry about it.
      In an interjection yesterday. I referred to the classic example of the Government wanting to give Lord Wigg a salary increase. They hurried it up to get it through before the Bill could be effective. They gave him an increase of £2,800 a year retrospective for 12 months, a 39 per cent. increase, making a total increase of 57 per cent. in two-and-a-half years. I was told that the reason was not so much that they wanted to help Lord Wigg—God bless him—but they had a new chairman of the Betting Levy Board taking over and they did not want it to be said that they had increased his salary to £10,000 a year. Why?—because the chaps who were "negotiating"—I put it in inverted commas—at Downing Street might have objected.
      That is the way the story goes. We have a "phoney" Government. If I were to say that Ministers were crooked I should be out of order, so I cannot say that but I can say that the Government are a crooked Government, crooked because they act viciously against lower-paid workers while at the same time are only too keen to hand out largesse to their friends, and even—let us admit it—to Members of Parliament.
      The Prime Minister promised that he would settle the terms for British entry into the Common Market only if he had the full-hearted consent of the people, but now, although the country is not in favour of entry, we shall probably have Members of Parliament going to the European Parliament. They will get £40 per day tax-free expenses. I am told that the lucky ones—
      The Chairman: I am sorry to interrupt the hon. Gentleman, but he is straying a little far from the amendment, ingenious and interesting though he may be. He ought now to come back to the amendment. I am sure that he appreciates that other hon. Members wish to speak.
      Mr. Lewis: Yes, I do, Sir Robert, but I understood that the purpose of the Amendment was to exclude what was unreasonable, and I am discussing what is reasonable and unreasonable. I assume that it is relevant to consider in this connection whether it is reasonable and right to give £25 a day tax-free expenses to Members of Parliament when one of the purposes of the Bill is to control inflation.
      I do not trust this crooked Government, who do one thing for the lower-paid but something very different for the higher-paid. I cannot support the amendment because the suggestion behind it is that we should limit even this limited clause, Clause 4.
      I cannot trust the Government. It has been announced this week that Sir Alan Marre, the ombudsman, is to take on the hospital service, and I understand that he will have an increase in salary. But he has to wait till the Bill is through, and then he can have his increase.
      For all those reasons, because the Government are a phoney Government and what they are proposing in the clause is as crooked as most of the things they do, I cannot agree to the amendment.
      Mr. Ian Percival: I wish to bring the Committee back to the amendment and away from the rag-bag of miscellaneous inaccuracies just presented by the hon. Member for West Ham, North (Mr. Arthur Lewis). I echo everything said by my hon. and learned Friend the Member for Dover (Mr. Peter Rees) in moving the amendment. I take it that his wish is to make clear beyond doubt that all that is allowed here is what is reasonably required for the purposes of the Bill.
      I expect that my right hon. and learned Friend will say that that is covered by the words of the Clause,
      "For the purposes of this Act".
      But many of us feel that, even though that may well be right, this is an instance

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      in which, even though the words may produce the result we want, it would be even better if further words were used to express exactly what we mean.
      What we all mean here is that the information which may be required ought to be clearly restricted, and be specifically described as so restricted, to what is
      "reasonably … required for the purposes of this Act".
      My hon. and learned Friend the Member for Dover referred to subsection (2) of the clause, which has to be considered in relation to subsection (1) and his amendment. Albeit that I agree entirely with what he said, I wish to put a slightly different point. I expect that my right hon. and learned Friend will give us the clarification for which he has been asked. I dare say that, as practising lawyers, we could, if we got the books out, work out exactly what subsection (2) means. But nobody ought to have to do that. We should not have legislation, even a little subsection like this, which no layman has a chance of understanding.
      We are dealing here with requests for information which may be made by a Minister. The qualification on the requirement to give that information is contained in subsection (2). Very few laymen, if any at all, could decide for themselves whether subsection (2) entitled them to refuse the information. They would have to go to a lawyer and seek advice. I regard that as fundamentally wrong.
      We may well have some provisions in Acts of Parliament in respect of which people have to go to lawyers because the matters are very complicated, but we are starting here with a provision about which one can say with certainty that almost everyone would have to go to a lawyer to ascertain whether he could take advantage of the protection which it is intended to give him. With respect, I regard that as bad. We ought to avoid it whenever possible.
      I hope that the Committee will note that, despite what the hon. Member for West Ham, North always says about lawyers, it is the lawyers in this instance, as usual, who are asking for a law to be made clearer so that laymen may be able to understand it without going to lawyers.
      Mr. Loughlin: On a point of order, Sir Robert. I am a little concerned about the way in which we are taking the amendments. I have no vested interest because I do not wish to speak on any of them, but I gather that between 7 and 9 p.m. we are to discuss Nos. 39 and 40 and Nos. 51 and 70. Is there any reason why the whole lot should not be taken together, just as we have done in each of the other guillotine periods? If we do not do that, Sir Robert, there will probably be two sets of speeches from the Government Front Bench, with consequently shorter time for back benchers, particularly back benchers on this side of the Committee.
      The Chairman: I do not think we should do that. We shall be taking Amendment No. 51 and Amendment No. 70 together, and the Committee will the sooner reach them if we get on quickly now. I am sure that the hon. Member for Orpington (Mr. Stanbrook) will be brief and that the Minister for Trade and Consumer Affairs will be able to reply shortly.
      Mr. Ivor Stanbrook: I support what has been said by my hon. and learned Friends the Members for Dover (Mr. Peter Rees) and Southport (Mr. Percival) about the subsection. We are growing rather used to legislation devised by the mandarins of the Treasury which proves in practice to be unsatisfactory to both laymen and lawyers. I have in mind the abhorrent penal clauses of the VAT legislation. It is perhaps symptomatic that Clause 4, which gives such sweeping powers to the Minister, has perhaps to be read in the light of the first paragraph of the schedule, which provides that the Minister—
      "may define any expression used in those sections.."
      Whatever that means, it is an oppressive way of dealing with the subject.
      The only safeguard we appear to have is the nebulous subsection (2) which suggests that one cannot be compelled to give information if one could not be compelled to give it in the High Court. It is rather difficult to understand just what that means. All sorts of questions such as privilege, protection against self-incrimination, relevance, competence and jurisdiction arise. The whole thing seems to be wildly uncertain. An explanation is certainly required. I believe that the amendment is justified.
      The Minister for Trade and Consumer Affairs (Sir Geoffrey Howe): I appreciate the wish of the Committee to get on to the next group of Amendments. I will deal with the points raised on the Amendment as quickly as I can. I will not follow the points raised by the hon. Member for West Ham, North (Mr. Arthur Lewis), which would take us back to a familiar but different topic from that which is the subject of the Amendments, save only to say that, whatever is his experience about telephone calls, the position is that during the last nine days my Department, regionally and centrally, has answered more than 10,000 telephone inquiries, to the satisfaction of those who have been making them. The hon. Gentleman's position, for one reason or another, must be exceptional.
      Mr. Arthur Lewis: Is the Minister sure about that?
      Sir G. Howe: My hon. Friend the Member for Oswestry (Mr. Biffen) was right—he was echoed by my hon. Friend the Member for Orpington (Mr. Stanbrook)—in drawing attention to the far-reaching nature of the powers in the Bill, with particular reference to the first paragraph of the Schedule. I draw their attention to the fact that that paragraph relates to legislation under Clause 2 and not Clause 4. It does not extend its application to the Clause or subsection about which we are talking.
      7.45 p.m.
      Mr. Ronald King Murray: The right hon. and learned Gentleman says that paragraph 1 of the schedule refers specifically to Clause 2. But there is no reference to Clause 2 in Clause 4. The only words which give some indication of the ambit of Clause 4 are
      "… for the purpose of this Act …".
      Will the right hon. and learned Gentleman tell the Committee whether the provisions of the Bill are confined to Clause 2, or do they go beyond that and, if so, how far?
      Sir G. Howe: That is a separate point which I will come to in a moment. The more general point raised, quite apart from the discussions on paragraph 1 of the Schedule, is related to the far-reaching nature of the provisions, with particular comment on the provisions in Clause 4.
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      It is right that the Committee should concern itself with an analysis of powers of this kind. But it is equally valid for me to say in response—this was acknowledged by my hon. and learned Friend the Member for Dover (Mr. Peter Rees)—that this legislation is, as hon. Members have pointed out, of a temporary nature. It is designed to secure quick and effective action across the board during the standstill period. Therefore, it is perhaps inevitable—I do not accept the description which was given by my hon. Friend the Member for Oswestry—that it should be blunt and effective in its operation. When one looks at the matter in that context, it can be more readily understood.
      I accept the point that particular provisions in the Clause become all the more relevant when it is suggested that they should not be used as a model for any longer-term provisions. Certainly that should be looked at closely in that context.
      My hon. and learned Friend the Member for Southport (Mr. Percival) pointed out that the notice to be given under Clause 4 would have to be a notice for
      "… the purposes of this Act … "
      That is the point which is made by the hon. and learned Member for Edinburgh, Leith (Mr. Ronald King Murray). I should have thought that that means
      "… for the purposes of this Act …"
      In other words, that notice can be given in order to obtain information for the purposes of the Act. One would imagine and expect that information would be required in the context of whether an order should be made under Clause 2. That would seem to be the primary purpose of the Act. It is in that context that one would expect the words
      "… for the purposes of this Act… "
      to be construed.
      My hon. and learned Friend the Member for Southport said that those words would operate to give some limitation to the scope of the way in which the powers could be exercised. If I may give a little more detail about the background, it would be wrong to accept what the hon. Member for West Ham, North was saying—that the Bill and the policies embodied in it are not ones which the Government intend to implement and see

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      observed. We expect, as my hon. Friend the Member for Oswestry said, compliance with the policy to be almost overwhelmingly voluntary. If any case were to arise where such voluntary compliance was not forthcoming, and where it turned out that the provisions of the Bill were being infringed, the Government would not hesitate to exercise the powers contained in it to see that the measure was observed.
      In the context of obtaining information, the emphasis on "voluntary" is even more apposite. It is the intention—and the intention is likely to be fulfilled in practice—that information that might be required, and in respect of which the power can be exercised, would be forthcoming voluntarily. This is essentially a reserve power to cover cases where a formal notice is necessary to secure it.
      It is right, as my hon. and learned Friend the Member for Dover said, that similar powers were taken in the 1966 Act. Such powers were available, but they were included with the intention that they would rarely be used, if at all. It is also right that comparable powers exist in the VAT legislation. Apart from the fact that we expect compliance to be forthcoming voluntarily, I assure hon. Members that if it became necessary to use the provisions in Clause 4 as a means of obtaining information, quite apart from the legal implications referred to by my hon. and learned Friend the Member for Southport, the powers would be used to obtain information only in circumstances where sufficient voluntary compliance was not forthcoming. Even then, they would be exercised only in a restrained and reasonable manner. That is the assurance which I have been asked to give, and I readily do so.
      I have been asked about the intended meaning of subsection (2). The intended meaning is to give protection in the area covered by professional privilege, to protect privilege between a citizen and his legal advisers. The point has been raised that it could also be used to afford protection against self-incrimination. I confess that the subsection was not intended specifically for that purpose. I do not think it was intended for that purpose in the 1966 legislation, although I should not like to say, had the question been
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      put to me, that it might not extend that far in certain cases.
      My hon. and learned Friend the Member for Southport complained about the ordinary citizen's difficulty in understanding that proposition because of the reference to that which could or could not be done in proceedings before the High Court. I confess that he probably has a valid criticism there, and it is something which would need to be looked at if this legislation were designed to endure for more than a short time. The powers granted in 1966 were scarcely used, if at all, and we are confident that the powers in the Bill will be used only very occasionally, so I hope that the Committee will agree to leave the Clause as it now stands.
      My hon. Friend the Member for Oswestry returned to a point that he made yesterday about information being circulated by bodies, including the CBI, and the extent to which it was desirable for the Government to try to spell out and clarify the way in which the powers contained in the Bill would be exercised.
      The CBI document to which my hon. Friend referred yesterday and which has again been mentioned today is a document produced by the CBI, it is true, as it says, after consultation with various Government Departments, but it is a document internal to the CBI which the CBI thought would be useful to have circulated to its members. The section dealing with dividends contained a direct reproduction of the notice issued by the Treasury. That notice has been generally available—it was a Press notice—and is available for guidance on that point. It was published almost verbatim in most newspapers.
      The guidance contained in the rest of the CBI document is the kind of guidance that no doubt many organisations will have been giving to their members, and no doubt they will be doing so after consultation with the Departments concerned. I hope that what I have said clarifies the status of the CBI document and puts it in perspective.
      Mr. Biffen: What my right hon. and learned Friend has said certainly clarifies the status of the CBI document. I hope he will not take it amiss if I say that he has done no more than state what was very explicitly stated in yesterday's Financial Times.

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      What is of more interest is to know what advice has been given by the Department of Trade and Industry to the CBI to enable the CBI to fashion this advice, and what answers are to be given to the latest CBI representations concerning incremental scales. These are two matters which seem to me to be of such significance in the interpretation of the Bill that I hope that somehow or other, through the OFFICIAL REPORT, the House can be so informed.
      Sir G. Howe: That is an amplification of the point originally raised by my hon. Friend. The CBI document is, as it were, in two halves. One half is found on the published Treasury note, which is quite explicit and has been made available in full, and the other half, in so far as it is founded on consultation with my Department, is founded on consultation of the kind anyone is free to undertake in connection with people's particular requirements and does not rest on any document of the kind which the Treasury circulated in relation to dividends.
      I do not think I can say more than that, because the information given by my Department is related to questions posed with regard to the problems of particular organisations or industries. I will certainly bear in mind the point which my hon. Friend makes which in effect suggests that in so far as the Treasury has given explicit guidance on dividends it might be possible to give official circulation to more explicit guidance on matters which are the responsibility of my Department. By way of amplification of what is in the White Paper, I hope that what I have said will explain the present position.
      With regard to this pair of amendments, I invite my hon. and learned Friend to accept my assurance on this legislation which, as he said, is directed to specific objects for a short time.
      Mr. Will Griffiths: I apologise to the hon. and learned Member for Dover (Mr. Peter Rees) for not being present to hear him move his Amendment. During the time I have been in the House of Commons I have seen two Governments and four Ministers introduce wage restraint, or attempts at price control, or both; Sir Stafford Cripps, Mr. Selwyn Lloyd, the previous Labour Government and now the
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      present Government. When they have attempted to take the steps announced to Parliament through Ministers they have on some occasions been met by the public initially with a measure of good will. That was certainly the case when the Labour Government introduced their Prices and Incomes Bill. But those of us who have lived through these periods have in each case seen the attempt breaking down and failing. Like my right hon. and hon. Friends, and like some Conservative Members, I feel that this measure will rightly go the same way as have other Governments' attempts to impose a restraint on prices and incomes.
      A number of lawyers have spoken in support of the amendment, but Parliament when legislating is always very concerned that the law should be enforceable, that it should never be brought into disrepute. I have felt in recent years that in a number of instances we have legislated in a way that has placed an impossible burden on the organs of enforcement. Parliament should not do that.
      Although Government supporters and hon. Members in other parts of the Committee may sincerely wish to write into the Bill a form of words which will give effect to the Government's desires on prices and incomes, by the very nature of the problem in a free society it is impossible of achievement. The whole of this piece of legislation, going by all recent historical precedents, is impossible of enforcement, and to that extent is itself an instrument which brings the law into disrepute.
      I listened to the short intervention by the hon. and learned Member for Southport (Mr. Percival) and the speeches of his hon. and learned colleagues, and, being a suspiciously-minded Socialist, I read into their observations a defence of the employer, a desire that there shall not be too much inquiry into the performances of what is laughably called the private sector.
      Mr. Percival: Until a moment ago I felt that the hon. Member was carrying every lawyer in the Committee with him. We lawyers are those who are perpetually expressing the hope that legislation may be understandable so that it may be enforceable. Will he accept an assurance that what I said was motivated solely by

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      that hope, and did not bring into consideration at all the position of any individual otherwise than in the respects to which I refer?
      Mr. Griffiths: Of course I accept what the hon. and learned Gentleman says, but we, as members of the House of Commons, are divided by political differences. I venture to repeat my belief that the whole purpose of this piece of legislation, however it is written and however it is amended, is, by the very nature of the beast, particularly impossible to enforce, and I do not believe that anyone who has lived through the periods to which I referred would deny it.
      Now is not the appropriate moment to cite chapter and verse in support of my argument. That was done on Second Reading and on other occasions, and we shall hear it again before the Bill leaves this House. The reason for my intervention was to make the point that I hope I have made. The hon. and learned Member for Southport said that he went along with me in part. If the Bill is to work, which I think is impossible, there should be the same power of inquiry into what I earlier described as the private sector, which is difficult, if not impossible, to carry out, as the Government have in their ability to intervene in the public sector.
      The one thing which is clear about the Bill, apart from the question of its timing and whether it is relevant and whether it will work when dealing with inflation, is that any Government, whatever their political complexion, cannot make a start on controlling economic affairs of the country until they occupy what Mr. Bevan described as the more commanding positions in control of the economy.
      8.0 p.m.
      Mr. Peter Rees: I hope it will not be immodest of me to claim that the amendments have given rise to a short but valuable debate. I am glad that my right hon. and learned Friend was not moved to say that I have asked the wrong question in the wrong way, as he did earlier this week. We have touched briefly on great constitutional issues, and we have received some indication of how the Government propose to proceed. We have with the assistance of my right hon. and learned Friend, who has not entirely
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      shed his professional past, looked into the dark places of the clause. Since what he has said will be scrutinised with great care by those who will be obliged to apply the clause or litigate it I hope I may be allowed to touch on three points.
      My right hon. and learned Friend has put great emphasis on the words in the subsection
      "for the purposes of this Act",
      and we hope that the courts will construe them in a limiting way so that a subject who feels himself hardly treated will be able to say "the notice goes beyond anything the Act requires". That is a refined point of law, and it would not be appropriate to debate it at this stage.
      My right hon. and learned Friend's restrictive construction of paragraph 1 of the schedule does not stand up to close analysis in the light of the last phrase, which says
      "and may define any expression used in those sections".
      That cannot mean only Section 2. It may have slipped in by inadvertence and it may not matter much, but it reinforces the point that the schedule has a wider significance than my right hon. and learned Friend was prepared to concede. He has left in the air the precise construction to be put on subsection (2). Someone may be compelled to test the precise limitations of that subsection, but I do not wish to worry the Committee with it now. Perhaps it would have been more courteous and more sensible of me to have given him more notice of this difficult point.
      My hon. Friend the Member for Oswestry (Mr. Biffen) and the hon. Member for West Ham, North (Mr. Arthur Lewis) both suspected that the clause might never be tested, and I hope that it never will be. But we have had some indication from the Government of their intentions, and because, unlike the hon. Member for West Ham, North, I do not believe that this is a crooked Government, because I believe the clause will have only a limited application in point of time, and because I hope that at the end of the day no one will be subjected to the powers that the clause may confer, I beg to ask leave to withdraw the Amendment.
      Amendment, by leave, withdrawn.
      Mr. Anthony Wedgwood Benn: I beg to move Amendment No. 70, in page 3, line 27, at end add:
      '(3) The appropriate Minister shall exercise the powers conferred on him by subsection (1) above when he is supplied in writing with details of an increase in a price or charge by a duly authorised officer of any local authority, and shall publish his conclusions'.
      With this amendment, I understand that it would be convenient to discuss Amendment No. 51, in Clause 4, page 3, line 24, at end insert:
      '(2) The information referred to in the preceding subsection shall include:

      (a) Manpower: Numbers of employees by job description; rates of turnover, short-time, absenteeism, sickness and accidents; details of existing provisions for security, sickness, accidents, recruitment, training, redeployment, promotion and redundancy;

      (b) Financial: Sales turnover by main activities: home and export sales; non-trading income, including income from investments and overseas earnings; pricing policy;

      Costs: distribution and sales; production costs; administrative and overhead costs; costs of materials and machinery; labour costs, including social security payments; costs of management and supervision;

      Incomes: directors' remuneration; wages and salaries; make-up of pay—negotiated rates, payment-by-results, overtime and bonuses;

      Profits: before and after tax and taking into account Government allowances, grants and subsidies; distribution and retentions;

      Performance indicators: unit costs, output per man, return on capital employed, value added etc.;

      Worth of company: details of growth and up-to-date value of fixed assets and stocks; growth and realisable value of trade investments;

      (c) Prospects and Plans: Details of new enterprises and locations; prospective close-downs; mergers and takeovers;

      Trading and sales plans: investment plans, including research and development;

      Manpower plans: plans for recruitment, selection and training; promotion, regrading and redeployment; short-time and redundancy provisions; and

      (d) General information: A description of the company's activities and structure: details of holding companies and subsidiaries; organisational and managerial structure; outside contracts'.

      The debate which is about to begin and which will be terminated by the guillotine will go over much of the ground that we have discussed in the last hour with the difference that the object of
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      these amendments is to make explicit the need for more information, not less. Amendment No. 51 lists a number of pieces of information which we believe the Government will need, and Amendment No. 70 provides that local authorities can report upon price increases and that the Minister should take action upon the basis of reports from those local authorities.
      It is very significant that when we are debating those parts of the Bill that relate to the protection of the consumer the Government Front Bench is almost empty. I admit there is one Cabinet Minister present tonight, but there was no Cabinet Minister present when we had the debate yesterday on price increases. When we come to the provisions for holding back wage increases the Chancellor of the Exchequer and Secretaries of State are arrayed there. The balance of the Bill in the Government's mind is made clear by the amount of attention they give to the particular clauses. They are not a bit interested, I submit, in those parts of the Bill dealing with prices and information to be provided by firms. The object of the Bill is to provide an excuse and an opportunity for wage restraint.
      The Minister for Trade and Consumer Affairs used sweet words to deal with the earlier amendments, but his sweet words will carry no weight in the court because the Bill gives the Government powers which cannot be challenged effectively in the court. If the Minister issues a notice under Clause 4, the notice may be in any form prescribed by regulation. It takes precedence over all other legislation. Orders under the Act will supersede legislation already upon the Statute Book.
      It is most interesting to watch the reeducation of the hon. Member for Oswestry (Mr. Biffen) stage by stage. The intention of the Bill is only one more stage in the process of transformation by which the Government move from disengagement to what The Times, that old weather-cock that always comes round in favour of what the Government are doing, westerday described as the
      "sure hand of confident intervention."
      The hon. Members know very well that line by line the Conservatives are with-drawing their manifesto and line by line is substituted for it a new way to

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      approach the problems of economic and industrial policy.
      Mr. Biffen: Re-education or not, would the right hon. Gentleman at least give me the credit that I go unwillingly to school?
      Mr. Benn: The hon. Member is, if I may say so, the only Member worth listening to on his side because he discusses the change that is taking place while the Government Front Bench seems to think that the Government have always taken that view.
      The Government have produced a Bill which is supposed to be temporary. Any-one with any experience of Parliament Knows that the one thing which guarantees permanence is to include "temporary" in the long title of the Bill. The Minister, in trying to fend off gently the amendment moved by his own side, said that this was a temporary provision. I am sure that the right hon. and learned Gentleman is accidentally misleading the Committee. Whether there is to be a voluntary or statutory supervision of prices, firms must provide information. Therefore, even if the Government come forward with a voluntary policy as the basis of an agreement between the TUC and the CBI they will not be able to monitor it without information statutorily required. Even the present Government could not possibly tell the TUC "We accept your voluntary policy. You will monitor it, but if the firm will not give you any information we are sorry, but you will have to monitor it all in the dark." Therefore, in dealing with the previous amendments the right hon. and learned Gentleman misled the Committee.
      The clause is guaranteed to be reproduced in the next legislation, because without a statutory provision that firms give information to the Government, the CBI, the TUC and a new Prices and Incomes Board—the hon. Member for Oswestry (Mr. Biffen) knows that that is coming next—the Government are abandoning every aspect of the offer they have made to the TUC. So let us be candid. This is a fundamental change in the relationship between the Government and industry requiring that information should be given, and that information will be permanently required.
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      Our first amendment, No. 70, makes it necessary for the Minister to exercise his powers when an increase in a price or charge is reported by an officer of a local authority. I shall not go over the ground that I tried to deal with yesterday in Committee, when I spoke of the difficulty a shopper would have in facing a shopkeeper when a price had been increased. Obviously that is so unequal a battle that local authorities would have to be brought in, even under a voluntary policy. Here we are saying that local authorities are the proper people to safeguard the shopper when prices increase and that if local authorities' weights and measures officers, or local shopping advice centres of the kind being brought into being, report matters to the Minister he should require information from the firm, as provided by the draconian words in the Bill.
      The second provision we seek to insert relates to the sort of information that is necessary. I advise hon. Members to read very carefully the wording of Amendment No. 51, a very long amendment in the names of my right hon. Friend the Member for Leeds, East (Mr. Healey) and myself. I did not draft it; its words come from the TUC's booklet "Good Industrial Relations". I put them down for the Committee to consider because if the Government ever want to draw the trade union movement into a voluntary arrangement they will have to provide the information that the TUC itself regards as necessary to monitor the activities of business.
      It is true that the information required is formidable:
      "Manpower: Numbers of employees by job description; rates of turnover, short-time, absenteeism, sickness and accidents;.. Financial: Sales turnover by main activities: … Costs: Distribution and sales; … Incomes: directors' remuneration; wages and salaries; … Profits: before and after tax … Performance indicators: …"
      That is formidable information, which the trade union movement believes should be available to all trade union negotiators when they are negotiating for a wage increase. If the trade union movement regards that as necessary for wage negotiations, it is of course the information it would require if it were to be part of the voluntary vetting system which the Government are offering to it. Therefore,

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      I beg the Committee to take seriously the words of that amendment.
      8.15 p.m.
      If the trade unions need that information to negotiate on behalf of their members, surely the Government need it to determine whether a price increase is justified. When the Minister said that he had received many telephone calls, all he could say was that his Department had given very satisfactory answers. I was very interested, because I read in The Times this morning that the Department of Trade and Industry says that most of the 200 letters it has received each day about the freeze have been requests to raise prices. Therefore, it appears that the requests to the Minister that are receiving satisfactory answers are requests to raise prices. How can the Government seriously present the Bill as a protection of the consumer when it covers only a narrow range of consumer expenditure—rents, food, land and housing are excluded—and in the area where they pretend to provide cover most of the inquiries are for prices to be increased?
      The truth is that no Minister can give a serious or sensible answer to any firth that asks for a price increase without the information that would be provided under Amendment No. 51. I say this because some time ago, in an earlier period of standstill, we had the job of administering a prices policy. I am sure I shall not surprise any hon. Member when I say that when British Leyland and other car firms wanted to raise prices we could not give them a rational answer without a great deal of information from them.
      Therefore, I tell the hon. Member for Oswestry that this is the beginning of the permanent vetting of company business by Government, if it is a statutory policy. If it is a voluntary policy, it is the beginning of permanent vetting of company business by the unions and other companies. The hon. Gentleman understands that very well. It does not help the Committee to hear the mild words of the Minister for Trade and Consumer Affairs to allay his colleague's anxiety when this is a major change.
      In the whole business of the Bill it is not only price increases that concern trade unions. Many trade unions are confronted with another threat to the security of their members in the form
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      of sudden closures. I could cite many cases, going back to Upper Clyde Shipyards, Fisher-Bendix, Briant Colour Printing, CAV-Lucas or the Skelmersdale case. Workers are suddenly confronted with the closure of a firm, and no information is provided.
      I shall take the Skelmersdale case to illustrate the importance of our amendment. The plant, the largest in Europe, employed 1,072 workers. It cost £12 million to build and substantial Government investment was involved. It began with a takeover in 1964 by Courtaulds, when substantial public money was put in. What was the timetable of closure? The closure notices were printed on 7th November. The unions were told at 3.30 p.m. on 8th November. The management was given the notices at 4.40 p.m. that day, and the notices were posted at 5 p.m. There was eight weeks' notice to stop the weaving, and if the closure had gone through it would have meant up to 18 per cent. unemployment in Skelmersdale. And the Government were not even told. I read in the newspapers that Ministers are supposed to be angry with Courtaulds because it did not tell them what was happening.
      The closure decision has apparently been renegotiated. We read in The Times today that Courtaulds' profits are 31 per cent. above forecast, reaching £21·3 million. How can the trade unions negotiate with employers if they do not have the relevant information? How can the Government deal with Courtaulds, with prices or with the bold interventionism that The Times demands unless the information is available?
      I have made my case as briefly as I can. The amendment will be a test of the central question that the Committee must determine in deciding whether to go ahead with the Bill—whether the intervention to which the Government are now committed is in the interests of the community, as the Government claim, in the interests of workpeople and consumers, or whether it is just a thin veil to allow the Government to bring into being the wage freeze upon which their minds are set. That is the central question which comes up in every amendment.
      I commend our amendments to the Committee. They are intended to

      715
      strengthen that part of the Bill which helps the consumer and the workpeople, and to prevent the Government from carrying through what is otherwise a cover for the wage freeze they seek to impose.
      Mr. John Golding: It is very important that we give full support to the amendment. My right hon. Friend the Member for Bristol, South-East (Mr. Benn) is not a novice in these matters. The Post Office trade unions were delighted when they discovered that the Post Office Act, 1969, provided for the formal disclosure of management information to employees. The fact that the Act included that provision was due in no small measure to my right hon. Friend.
      Two points should be made tonight. First, it is in the short-term interests of any incomes policy which is pursued that there be as much disclosure of information as possible. At present there is a great deal of cynicism among workers and consumers about the way in which this policy will operate. Most people believe that wages will be frozen very solidly indeed. Many believe that this will be possible for the Government because, in both the public and the private sectors, what a person earns is well known and well defined. It is very difficult to achieve changes in wages, in either the public or the private sector, without a considerable number of people being aware of the changes involved, because often so many individuals are affected by the change.
      It is thought that wages will be frozen more solidly than remuneration which is based on some individual agreement. It is very important that there be some way of ascertaining what has happened to salary structures within firms. From the viewpoint of people on the shop floor, it is very important that there be some way of forcing the disclosure of changes in perks and additions to salaries which in some way will get round any sort of freeze. It is important that workers see that the freeze is working fairly.
      Whilst employers are wrong to try to stop the natural increments which occur within the public service—the Civil Service—they are right to draw attention to
      716
      the loopholes which exist for salaried workers but which do not exist for manual workers on the shop floor. It is important that the Government should be able to find out precisely what is happening in firms, not only about salaries but also in relation to profits. It is high time that firms were forced by law to disclose to their workpeople not only their total profits but also how they have been distributed and—this is very important—to whom they have been distributed. Workers have as much right to know what happens to profits as shareholders have to know what is happening with the wages bill. The disclosure of information makes that possible.
      It is very important that in the short term there be full disclosure of information, but in the long term the arguments put forward by my right hon. Friend the Member for Bristol, South-East are equally important. The TUC is concerned about the improvement of industrial relations. I give evidence to the Donovan Commission on behalf of the Fabian Society, when we said that one of the most important factors in the improvement of industrial relations was a greater degree of disclosure of information by employers to trade union negotiators. That is particularly important in regard to investment decisions because these, more than any other decisions affect the whole life of a working person. A decision can he taken around a boardroom table which will destroy towns and take away the total livelihood of individuals, which will make completely obsolescent skills they have taken half a lifetime to acquire. These decisions should not be taken without reference to workpeople or without full discussion with their representatives.
      What amazes me in our society is that we have a Parliament in which we discuss at length, sometimes ad nauseam, political decisions which are of small consequence to people outside. One has only to look at our business for next week and see some of the matters which will be under discussion to realise how little impact some of these political matters have on the lives of ordinary people. When it comes to their working lives, however, to the source of their incomes or the whole question whether they are to be fit or unfit due to processes used at work, these major matters which preoccupy the industrial worker are not permitted to be discussed.

      717
      The workers are not even allowed, as people were before the 1832 Reform Act, to have at least the basic information on which to discuss political matters. That information is denied them.
      There can be no democracy, no semblance of participation anywhere, without information. Unless people are informed of the issues which face industry and of the complexities of the decisions that face management and union leaders, they can take no responsible or reasonable attitude towards them. That is what we should be trying to achieve in industry at present: a degree of responsibility and participation, a degree of the acceptance of responsibility that we expect of people in political life but which we deny to people in their industrial lives.
      It is for that reason that I strongly support the Amendment.
      Mr. Peter Rees: The right hon. Member for Bristol, South-East (Mr. Benn), who moved the amendment with his customary debating skill, shifted from position to position. He began with such accents that I wondered why he had not given some modest measure of support to the two amendments which I moved. Then he appeared to unveil himself as a syndicalist, which should not come entirely as a surprise to the Committee in view of his well-publicised activities on the Upper Clyde. Finally, he showed himself perhaps in his true colours as a dirigiste verging on the complete Marxist. These are all possible and respected positions, but it is right to know where the right hon. Gentleman stands on this matter.
      These are heady topics. Indeed, the right hon. Gentleman encouraged the Government and hon. Members sitting behind my right hon. and learned Friend to believe that this must be the prelude to full-blooded intervention by a Conservative Government in the whole sphere of prices and incomes. I cannot accept that. Indeed, I should have even greater reservations about the Bill than I have at the moment if I seriously believed that it were the prelude to a full-scale interventionist policy by this Government.
      I profoundly believe and accept the assurances which have been given by the Government that this is to be a short, sharp freeze. It can be entirely justified
      718
      and accepted in those terms even by those of us who up to now, perhaps naively, perhaps too enthusiastically, believed that market forces, when liberated from a Socialist Administration, and dramatic decreases in taxation would bring inflation under control. Alas, we were proved too optimistic. There is no point in beating about that particular bush. This Chamber has been resonant with eaten words over the past week or fortnight. Indeed, perhaps all our digestions have suffered a little. But this is politics.
      We must treat this amendment seriously in the context of a Bill designed to last at worst 150 days. If we do the right hon. Gentleman the honour of taking his amendment seriously, as he would have us do, we must ask: what good purpose would be served by inflicting questions of this kind, interesting though the answers might be, on the long-suffering business community of this country? Indeed, it is perhaps a cause for comment that the questions would be directed exclusively to management, not to trade unions. I believe that I could have constructed an equally formidable list of questions which would be equally oppressive and distasteful to the leaders of the Trade Union Movement. We must recognise that both sides of industry have to carry a burden here. Certainly my concern, and I am sure that of my right hon. and learned Friend, is to ensure that the burden imposed on both sides of the business community should be as light as possible.
      Therefore, viewing the amendment in this light, I hope that the Committee will reject it.
      [Miss JOAN QUENNELL in the Chair]
      8.30 p.m.
      Mr. Arthur Lewis: On a point of order, Miss Quennell. I am sorry that the Chairman is not present, because I wanted to raise this point with him. I can go only on what I hear and see. I see and hear a growing practice, which is not for the good of the Committee, of the Whips going to the Chair, advising who should be called, and then finding that those whom they advise are called. It happened last night and it has happened today. I suggest that when the Whips tell an hon. Member to sit down or not to take part in a debate, because the Government

      719
      want to get on with their business, that is a matter between the hon. Member and the Whips. With respect, however, it is not for the Chair to be advised by the Whips who should or should not be called.
      Having made my point to you, Miss Quennell, I will see the Chairman of Ways and Means and have a word with him about it.
      The Temporary Chairman: I am obliged to the hon. Gentleman. I am sure that, as a Member of some experience, he is aware that no Whip has yet successfully told any hon. Member what he should or should not do.
      Mr. Frank Tomney: Following the brief intervention by the hon. and learned Member for Dover (Mr. Peter Rees) and his prognostications and forecasts whether the freeze will be short, I suggest there are several different opinions. One opinion held by many of us is that legislation of a permanent character will follow the Bill. It is better that we should know where we may eventually be led.
      In 1966 and 1967 the Labour Government had to introduce similar legislation. We know what followed that legislation. For the sake of our economy, we do not want that to happen again. We want to ensure that the people most vitally concerned with a Bill of this character—the wage earners—will be afforded every possible protection in future legislation.
      We are facing a situation for which there has been no previous economic forecasting—of expansion of interest rates, of world demand, of money supply and of extravagant advertising—which affects possibly every country in the Western world, and our own more than any other. The philosophy according to which right hon. and hon. Members on the Government side were elected has been stood on its head during the past two years. As a result, they have been forced to confront us with this Bill.
      Anyone on the escalator of inflation with one or more capital assets behind him may consider that the situation is not too serious. However, many people never get on to the escalator. The future for those people—those with whom we
      720
      were previously concerned during our debates on housing and mortgages—is extremely bleak, since it is almost impossible for them to acquire capital. How can they be protected? Although the amendments would go some way towards solving the problem, they do not touch on one-tenth of the problems which may arise.
      For example, there is a world commodity demand for raw materials over which we have very little control. What can be done when there is a rundown of resources and an over-productive capacity which cannot be utilised? The consequence of that would be increased unemployment, inflation and high interest rates and very little investment, the last of these being one of the kernels of the problem.
      The atmosphere in which the Bill has been presented is very important. Newspaper after newspaper contains accounts of company reports, increased dividends, increased share ownership, property speculation, take-over bids and people making fortunes overnight with very little effort. The crux of the issue, whether the company is Rolls-Royce or any other, is "How can we control the cost of productive output?" Invariably it comes back to wages. It always has done, and it always will do. Everything else affecting retailers, manufacturers and agents is almost impossible to apply. One could gum up the works in trying to apply it. For example, which official in a local authority would deal with complaints? He might have to write as many as 1,000 reports a day to the Department. It simply would not work.
      Some people—I am not among them—considered that the TUC was rather awkward in resolution No. 51, which sets out the TUC position on wage negotiation and bargaining. This is the kind of thing which must be built into the changing pattern of trade union negotiation, not only in this country but throughout the world. Situations will invariably arise for which economists can produce no accepted solution. For example the Japanese, with the £9,000 million surplus in their balance of trade, ruthlessly ditched Formosa overnight. There is a short sea haul to China for heavy capital goods against anything which we can offer. However, the bonanza for consumer and durable use goods is in

      721
      Europe. This is where the raid will come. All capital goods exported to China will be subsidised for a long time to come. In subsidising such articles as dynamos, one is virtually subsidising every capital industry.
      The Americans too have seen this trend, and we saw it earlier when we recognised the new China. Thank goodness we did so. But that will become the pattern and the competition for resources will be great. How do we make sure, with our growing population problems, that we make enough investment out of our own earnings?
      All that ties in with the new pattern which is emerging, not only in this country, but in the United States. President Nixon achieved a certain amount of success with such action last year, not because of his own Republican Party but because people were afraid that the situation might run away from them. Our job as the Opposition is to make certain that, however long the Bill operates, the arguments adduced here shall be taken notice of when future legislation is presented. If further legislation is proposed, it should be subjected to even more rigorous scrutiny than this Bill.
      After the jettisoning of the whole policy on which the Conservative Party was elected, including its action in nationalising Rolls-Royce, it has come to realise that the industrial, financial and commercial climate is changing. We want to see that climate changed. We want to see the engendering of trust. We want the people who are doing well to be more modest in their success. People read newspapers more now, whereas in my day—and I am not old—there were no newspapers devoted to City and financial news, which forms a large part of newspapers today. Those subjects are understood today, including comparison of Courtaulds registered profits with the closure of Skelmersdale. People are beginning to realise that in Skelmersdale and Rolls-Royce there is heavy commitment of public funds. They begin to say, "What the hell! Exactly where are we going?".
      Therefore the Bill must go through, with an operating period of 60, 90 or 150 days. But whatever is to follow it—and I believe that something will—I tell my hon. Friends that we shall have to be careful when that follow-up is introduced.
      Sir G. Howe: I hope that the hon. Member for Hammersmith, North (Mr. Tomney) will forgive me if I do not follow directly on his arguments. I want to link them to what was said by the hon. Member for Newcastle-under-Lyme (Mr. Golding), because both hon. Members drew attention in different ways to the extent to which it was right and legitimate for trade unions and their members to expect to be given certain information by the employers with whom they have to deal. The topic is important, though not directly related to the subject of the debate, but I do not challenge the importance of the matter as it was dealt with in the speech of the hon. Member for Newcastle-under-Lyme.
      I remind the Committee that the importance of disclosure of information was first recognised in the provisions of Section 56 of the Industrial Relations Act. They place a duty on employers to disclosure to trade union representatives specified information necessary for the purpose of collective bargaining. Its importance is further recognised by the fact that my right hon. Friend the Secretary of State invited the Commission on Industrial Relations on 4th November last year to study further what information ought to be disclosed to workers and their representatives. That report was in my right hon. Friend's hands on 1st September this year. Section 2 of the Act requires the Secretary of State, in preparing or advising on the Code of Industrial Relations Practice, to have regard to the need to give practical guidance on disclosure. The matter is being considered again in the light of the CIR report.
      8.45 p.m.
      I hope that no hon. Member, from what has been said in this debate, will run away with the illusion that the importance of disclosure of information and of collective bargaining is unrecognised by the Government. It is not easy to see how the argument along those lines becomes a foundation for the amendment as drawn. It has nothing to do with the present argument. Indeed, the foundation of the Opposition's case was somewhat difficult to understand. At one point the Opposition appeared to be protesting that the Bill made any provision at all for the requirement of information from employers in relation to price increases and went on to protest at the

      723
      ineffectiveness of the machinery that was provided.
      The whole burden of the amendment is designed to turn the apparatus of the Bill into pervasive, far-reaching, ruthless machinery for inquisition. It is unnecessary and unacceptable to have the information-seeking powers which are contained in Clause 4 designed in that way.
      I remind the Committee that the purpose of this legislation is to produce a standstill for the duration of the period covered by the Bill, during which time—as my hon. and learned Friend the Member for Dover (Mr. Peter Rees) appreciates—longer-term policies will be brought forward and placed before the House. That standstill is designed to apply across the board.
      The right hon. Member for Bristol, South-East (Mr. Benn) suggested that there was an intended, if not inevitable, implication of the Government's policy to deal more softly with prices than with wages. I can assure him that there is no intention that the policy and legislation covers each element, whether pay and remuneration on the one hand, or prices, rents and dividends on the other, across the board and the intention is to be effective in that way.
      The right hon. Gentleman suggested again that the way in which my Department had been responding to inquiries made to it was in itself an indication of a willingness to be slack on price increases. I repudiate that. When I said that inquiries had been dealt with satisfactorily and gave the number of phone calls made, I was then speaking in the rather narrow context of the speech of the hon. Member for West Ham, North (Mr. Arthur Lewis), who implied that he was unable to get through when he tried to make a telephone call.
      I was merely drawing attention to the fact that large numbers of inquiries had been handled. To suggest that each phone call was an application for a price increase, and that each price increase had been granted, would be wholly to misrepresent the way in which the prices policy is being supervised. It is being supervised and explained along the lines set out in the White Paper, and requires anyone proposing a price increase to justify it by the tests there set out. There
      724
      is no slackness on that side of the policy at all.
      It would be ludicrous, however, to move on to the propositions contained in the right hon. Gentleman's amendment and to suggest that any policy for the regulation of prices, in any circumstances, would need to be as elaborate and contrived as is set out in Amendments No. 51 and No. 70. The intention is that, whenever a duly authorised officer of a local authority tells a Minister of a price increase, the Minister is to be required, according to these amendments, to serve a notice upon the person increasing the price requiring the information set out in the 27 lines of close print in this amendment—that is, to render any policy designed to restrain prices, particularly a policy to restrain prices during this transitional period wholly unworkable.
      It is absurd to transplant out of Appendix V of the CIR's report and out of the TUC's 1970 report a batch of standards designed to show the kind of information that it would be appropriate to reveal in the course of collective bargaining, a perfectly legitimate group of subjects to discuss and consider, as the CIR considered them in the context of collective bargaining, but it is quite absurd to suggest that those matters should be compulsorily disclosed in respect of anyone against whom a notice of price increase has been served. It indicates the way one might expect the right hon. Gentleman and his friends to proceed if ever they were to try to undertake this kind of task, and heaven forbid that possibility should arise.
      In his closing remarks the right hon. Gentleman suggested that the Government's policy over the standstill involved a discrimination adverse to consumers and to work-persons. Who is not both a consumer and a work-person? The policy is designed to help and advance the interests of the people to fulfil both those roles simultaneously. We are all consumers and we are all work-persons in one way or another. We all share the same anxious desire for a curtailment of the inflationary experience which this legislation is designed to stop.
      The Bill is introduced to help the people of the country as a whole. The intention is not in any sense advanced by the kind of analysis which the right

      725
      hon. Gentleman put forward; namely, that it is trying to separate consumers from workpeople, that their interests can be pitted against each other. The Bill is not trying to separate the interests of consumers and workpeople as one group against the interests of the Government as another. The Government are taking this action, which is intended to be effective across the board, to produce a standstill period for the benefit of the people, be they consumers, workpeople or anybody else. It is on that basis that the legislation in this form commands the support of the nation and deserves the support of the Committee.
      Mr. Gordon Oakes: Would the right hon. and learned Gentleman deal with Amendment No. 70? Little has been said about it, yet it is a key amendment. The hon. and learned Gentleman is now the Minister responsible for consumer affairs. Does he not consider it insulting that constituencies outside London should have to ring up the Department of Trade and Industry in London rather than go to the local authority? Does he seriously believe in what he is saying about prices in a statutory policy? Is it not akin, if my house were burgled in Lancashire, to my ringing up New Scotland Yard instead of going to the local police station? As Minister for Trade and Consumer Affairs why cannot he accept at least Amendment No. 70?
      Mr. Ronald King Murray: It is clear from the debate that the clause was drafted in haste. One need only refer to the matters explored in the last debate to see how true this is. However drafted in haste it may be, I think that my right hon. Friend the Member for Grimsby (Mr. Crosland) was correct in pointing out the symptoms of permanency which can clearly be seen there. It is because of these symptoms of permanency that the matters explored in the last debate are of great importance.
      One of the symptoms is the fact that only Clause 2 is guillotined. It is the only one that comes to an end after 90 days plus a possible extension of 60 days. Although the Bill is called the Temporary Provisions Bill, at the end of this period of 90 days, with a possible extension of 60 days, the Act will remain on the Statute Book. Therefore, there
      726
      is conceivable content for Clause 4 to be enacted as Section 4 as it then would be. It is for that reason that I think the Committee is correct in exploring the meaning of the clause with great care and attention.
      In replying to the right hon. and learned Gentleman I should like to stress to the Committee not the meticulous detail into which he sought to divide these amendments but the sense of the amendments. The sense of each of the amendments is quite clear. Amendment No. 70 deals with enforcement. Amendment No. 51 deals with information. The amendments are intended to convey our anxiety on this side of the Committee, which I am sure is shared by hon. Members on the Government side, concerning the need for enforcement of any attempt to hold down prices on the one hand, and on the other, the need for accurate information if anything effective is to be done to counter inflation in the long term. I ask the Committee not to be beguiled or sidestepped by the honeyed words of the right hon. and learned Gentleman but to go to the kernel of the matter.
      With regard to enforcement, the Bill is sadly lacking. I regret that owing the guillotine we did not have time to discuss Amendment No. 57, which suggests the most useful possible method of support for enforcement to any attempt at countering inflation by giving to each consumer the power to recover the excess of any charge which is illegally imposed upon him. The power is absent from the Bill. Therefore, as a next best thing the Opposition have sought to bring some degree of enforcement into this information clause by virtue of Amendment No. 70.
      The Government spokesman on Tuesday spoke of antennae; that was the analogy he used. He said that the Bill gave antennae which presumably were meant to operate in some way to assist in keeping down prices. Antennae are entirely confined to information, and what is needed, if there is to be effective consumer protection, is teeth. Teeth can bite—not just feel, but bite. Instead of cockroaches wandering around in the dark feeling with their antennae, we can have teeth that bite. Each consumer would be able to take one step on his own to ensure that he was not subjected to undue increases in price. Surely that

      727
      is the way to proceed, even with a temporary Bill, rather than the half-baked way presented in the Counter-Inflation Bill.
      I turn to the subject of information. My right hon. Friend the Member for Bristol South-East (Mr. Benn) mentioned the Skelmersdale case. He might also have mentioned the British Lion case. That is another example in which it is quite obvious that were information of the quality and nature sought in this Amendment available, but not only would industrial relations be improved but the consumer—which, as was pointed out, is every one of us—would be informed; and we would know what was being perpetrated upon us and what was the true
      cause of the inflation that bedevils the economic life of the country.
      The purpose of Amendment No. 51 is to show the need not simply for temporary powers about information but for permanent lines of communication which will provide communication between the two sides of industry and between the producer and the consumer. Only provisions for permanent lines of communication will be effective in the battle against inflation. For these reasons I advise my right hon. and hon. Friends to divide in support of the Amendment.
      Question put, That the Amendment be made:—
      The Committee divided: Ayes 267, Noes 292.

      Division No. 13.]

      AYES

      [9.0 p.m.

      Abse, Leo

      Davis, Terry (Bromsgrove)

      Hughes, Rt. Hn. Cledwyn (Anglesey)

      Allaun, Frank (Salford, E.)

      Deakins, Eric

      Hughes, Mark (Durham)

      Allen, Scholefield

      de Freitas, Rt. Hn. Sir Geoffrey

      Hughes, Robert (Aberdeen, N.)

      Archer, Peter (Rowley Regis)

      Delargy, Hugh

      Hughes, Roy (Newport)

      Ashley, Jack

      Dell, Rt. Hn. Edmund

      Hunter, Adam

      Ashton, Joe

      Dempsey, James

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

      Atkinson, Norman

      Doig, Peter

      Janner, Greville

      Bagier, Gordon A. T.

      Dormand, J. D.

      Jay, Rt. Hn. Douglas

      Barnes, Michael

      Douglas, Dick (Stirlingshire, E.)

      Jeger, Mrs. Lena

      Barnett, Guy (Greenwich)

      Douglas-Mann, Bruce

      Jenkins, Hugh (Putney)

      Barnett, Joel (Heywood and Royton)

      Duffy, A. E. P.

      John, Brynmor

      Beaney, Alan

      Dunn, James A.

      Johnson, Carol (Lewisham, S.)

      Benn, Rt. Hn. Anthony Wedgwood

      Dunnett, Jack

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

      Bennett, James(Glasgow, Bridgeton)

      Eadie, Alex

      Johnson, Walter (Derby, S.)

      Bidwell, Sydney

      Edelman, Maurice

      Jones, Barry (Flint, E.)

      Bishop, E. S.

      Edwards, Robert (Bilston)

      Jones, Dan (Burnley)

      Blenkinsop, Arthur

      Edwards, William (Merioneth)

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

      Boardman, H. (Leigh)

      English, Michael

      Jones, Gwynoro (Carmarthen)

      Booth, Albert

      Evans, Fred

      Kaufman, Gerald

      Bottomley, Rt. Hn. Arthur

      Ewing, Harry

      Kelley, Richard

      Boyden, James(Bishop Auckland)

      Faulds, Andrew

      Kerr, Russell

      Bradley, Tom

      Fernyhough, Rt. Hn. E.

      Kinnock, Neil

      Brown, Robert C. (N'c'tle-u-Tyne,W.)

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

      Lambie, David

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

      Fitt, Gerard (Belfast, W.)

      Lamborn, Harry

      Brown, Ronald(Shoreditch & F'bury)

      Fletcher, Raymond (Ilkeston)

      Lamond, James

      Buchan, Norman

      Fletcher, Ted (Darlington)

      Latham, Arthur

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

      Foley, Maurice

      Lawson, George

      Butler, Mrs. Joyce (Wood Green)

      Foot, Michael

      Leadbitter, Ted

      Campbell, I. (Dunbartonshire, W.)

      Ford, Ben

      Lee, Rt. Hn. Frederick

      Cant, R. B.

      Forrester, John

      Leonard, Dick

      Carmichael, Neil

      Fraser, John (Norwood)

      Lestor, Miss Joan

      Carter, Ray (Birmingh'm, Northfield)

      Freeson, Reginald

      Lewis, Arthur (W. Ham, N.)

      Carter-Jones, Lewis (Eccles)

      Galpern, Sir Myer

      Lewis, Ron (Carlisle)

      Castle. Rt. Hn. Barbara

      Garrett, W. E.

      Lipton, Marcus

      Clark, David (Colne Valley)

      Gilbert, Dr. John

      Lomas, Kenneth

      Cocks, Michael (Bristol, S.)

      Ginsberg, David (Dewsbury)

      Loughlin, Charles

      Cohen, Stanley

      Gourlay, Harry

      Lyon, Alexander W. (York)

      Coleman, Donald

      Grant, George (Morpeth)

      Lyons, Edward (Bradford, E.)

      Concannon, J. D.

      Grant, John D. (Islington, E.)

      Mabon, Dr. J. Dickson

      Conlan Bernard

      Griffiths, Eddie (Brightside)

      McBride, Neil

      Corbet, Mrs. Freda

      Griffiths, Will (Exchange)

      McCartney, Hugh

      Cox, Thomas (Wandsworth, C.)

      Hamilton, William (Fife, W.)

      McElhone, Frank

      Cronin, John

      Hamling, William

      McGuire, Michael

      Crosland, Rt. Hn. Anthony

      Hannan, William (G'gow, Maryhill)

      Mackenzie, Gregor

      Crossman, Rt. Hn. Richard

      Hardy, Peter

      Mackie, John

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

      Harper, Joseph

      Mackintosh, John P.

      Cunningham, Dr. J. A. (Whitehaven)

      Harrison, Walter (Wakefield)

      Maclennan, Robert

      Dalyell, Tam

      Hart, Rt. Hn. Judith

      McMillan, Tom (Glasgow, C.)

      Darling, Rt. Hn. George

      Hattersley, Roy

      McNamara, J. Kevin

      Davidson, Arthur

      Healey, Rt. Hn. Denis

      Mahon, Simon (Bootle)

      Davies, Denzil (Llanelly)

      Heffer, Eric S.

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

      Davies, G. Elfed (Rhondda, E.)

      Hilton, W. S.

      Marks, Kenneth

      Davies, Ifor (Gower)

      Horam, John

      Marquand, David

      Davis, Clinton (Hackney, C.)

      Houghton, Rt. Hn. Douglas

      Marsden, F.

      Huckfield, Leslie

      Marshall, Dr. Edmund

      Mason, Rt. Hn. Roy

      Price, J. T. (Westhoughton)

      Strang, Gavin

      Mayhew, Christopher

      Price, William (Rugby)

      Strauss, Rt. Hn. G. R.

      Meacher, Michael

      Probert, Arthur

      Summerskill, Hn. Dr. Shirley

      Mellish, Rt. Hn. Robert

      Reed, D. (Sedgefield)

      Swain, Thomas

      Mendelson, John

      Rees, Merlyn (Leeds, S.)

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

      Mikardo, Ian

      Rhodes, Geoffrey

      Thomas, Jeffrey (Abertillery)

      Millan, Bruce

      Richard, Ivor

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

      Miller, Dr. M. S.

      Roberts, Albert (Normanton)

      Tinn, James

      Milne, Edward

      Roberts, Rt.Hn.Goronwy (Caernarvon)

      Tomney, Frank

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

      Robertson, John (Paisley)

      Torney, Tom

      Molloy, William

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

      Tuck, Raphael

      Morgan, Elystan (Cardiganshire)

      Rodgers, William (Stockton-on-Tees)

      Urwin, T. W.

      Morris, Alfred (Wythenshawe)

      Roper, John

      Varley, Eric G.

      Morris, Charles R. (Openshaw)

      Rose, Paul B.

      Wainwright, Edwin

      Moyle, Roland

      Ross, Rt. Hn. William (Kilmarnock)

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

      Mulley, Rt. Hn. Frederick

      Rowlands, Ted

      Walker, Harold (Doncaster)

      Murray, Ronald King

      Sandelson, Neville

      Watkins, David

      Oakes, Gordon

      Sheldon, Robert (Ashton-under-Lyne)

      Weitzman, David

      Ogden, Eric

      Shore, Rt. Hn. Peter (Stepney)

      Wellbeloved, James

      O'Halloran, Michael

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

      Wells, William (Walsall, N.)

      O'Malley, Brian

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

      White, James (Glasgow, Pollok)

      Oram, Bert

      Silkin, Rt. Hn. John (Deptford)

      Whitehead, Phillip

      Orme, Stanley

      Silkin. Hn. S. C. (Dulwich)

      Whitlock, William

      Oswald, Thomas

      Sillars, James

      Willey, Rt. Hn. Frederick

      Owen, Dr. David (Plymouth, Sutton)

      Silverman, Julius

      Williams, Alan (Swansea,W.)

      Padley, Walter

      Skinner, Dennis

      Williams, Mrs. Shirley (Hitchin)

      Paget, R. T.

      Small, William

      Williams, W. T. (Warrington)

      Palmer, Arthur

      Smith, Cyril (Rochdale)

      Wilson, Alexander (Hamilton)

      Pannell, Rt. Hn. Charles

      Smith, John (Lanarkshire, N.)

      Wilson, William (Coventry, S.)

      Pardoe, John

      Spearing, Nigel

      Woof, Robert

      Parker, John (Dagenham)

      Spriggs, Leslie

      Parry, Robert (Liverpool, Exchange)

      Stallard, A. W.

      TELLERS FOR THE AYES:

      Peart, Rt. Hn. Fred

      Steel, David

      Mr. James Hamilton and

      Pendry, Tom

      Stewart, Rt. Hn. Michael (Fulham)

      Mr. John Golding.

      Perry, Ernest G.

      Stoddart, David (Swindon)

      Prentice, Rt. Hn. Reg.

      Stonehouse, Rt. Hn. John

      Prescott, John

      NOES

      Adley, Robert

      Chichester-Clark, R.

      Gibson-Watt, David

      Alison, Michael (Barkston Ash)

      Churchill, W. S.

      Gilmour, Ian (Norfolk, C.)

      Allason, James (Hemel Hempstead)

      Clark, William (Surrey, E.)

      Gilmour, Sir John (Fife, E.)

      Amery, Rt. Hn. Julian

      Clarke, Kenneth (Rushcliffe)

      Glyn, Dr. Alan

      Archer, Jeffrey (Louth)

      Clegg, Walter

      Godber, Rt. Hn. J. B.

      Astor, John

      Cockeram, Eric

      Goodhart, Philip

      Atkins, Humphrey

      Cooke, Robert

      Goodhew, Victor

      Awdry, Daniel

      Coombs, Derek

      Gorst, John

      Baker, Kenneth (St. Marylebone)

      Cooper, A. E.

      Gower, Raymond

      Baker, W. H. K. (Banff)

      Cordle, John

      Grant, Anthony (Harrow, C.)

      Balniel, Rt. Hn. Lord

      Corfield, Rt. Hn. Sir Frederick

      Green, Alan

      Barber, Rt. Hn. Anthony

      Cormack, Patrick

      Grieve, Percy

      Batsford, Brian

      Costain, A. P.

      Griffiths, Eldon (Bury St. Edmunds)

      Beamish, Col. Sir Tufton

      Critchley, Julian

      Grylls, Michael

      Bell, Ronald

      Crouch, David

      Gummer, J. Selwyn

      Bennett, Sir Frederic (Torquay)

      Crowder, F. P.

      Gurden, Harold

      Benyon, W.

      Davies, Rt. Hn. John (Knutsford)

      Hall, Miss Joan (Keighley)

      Biffen, John

      d'Avigdor-Goldsmid, Sir Henry

      Hall, John (Wycombe)

      Biggs-Davison, John

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

      Hall-Davis, A. G. F.

      Blaker, Peter

      Dean, Paul

      Hamilton, Michael (Salisbury)

      Boardman, Tom (Leicester, S.W.)

      Deedes, Rt. Hn. W. F.

      Hannam, John (Exeter)

      Body, Richard

      Digby, Simon Wingfield

      Harrison, Brian (Maldon)

      Boscawen, Hn. Robert

      Dixon, Piers

      Harrison, Col. Sir Harwood (Eye)

      Bossom, Sir Clive

      Dodds-Parker, Douglas

      Haselhurst, Alan

      Bowden, Andrew

      Drayson, G. B.

      Hastings, Stephen

      Braine, Sir Bernard

      du Cann, Rt. Hn. Edward

      Havers, Sir Michael

      Bray, Ronald

      Dykes, Hugh

      Hawkins, Paul

      Brewis, John

      Eden, Rt. Hn. Sir John

      Hay, John

      Brinton, Sir Tatton

      Edwards, Nicholas (Pembroke)

      Hayhoe, Barney

      Brocklebank-Fowler, Christopher

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

      Heseltine, Michael

      Brown, Sir Edward (Bath)

      Emery, Peter

      Hicks, Robert

      Bruce-Gardyne, J.

      Eyre, Reginald

      Higgins, Terence L.

      Bryan, Sir Paul

      Farr, John

      Hiley, Joseph

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

      Fell, Anthony

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

      Buck, Antony

      Fenner, Mrs. Peggy

      Hill, James (Southampton, Test)

      Bullus, Sir Eric

      Fidler, Michael

      Holland, Philip

      Burden, F. A.

      Finsberg, Geoffrey (Hampstead)

      Holt, Miss Mary

      Butler, Adam (Bosworth)

      Fletcher-Cooke, Charles

      Hordern, Peter

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

      Fookes, Miss Janet

      Hornby, Richard

      Carlisle, Mark

      Fortescue, Tim

      Hornsby-Smith, Rt.Hn.Dame Patricia

      Carr, Rt. Hn. Robert

      Foster, Sir John

      Howe, Rt. Hn. Sir Geoffrey

      Cary, Sir Robert

      Fowler, Norman

      Howell, Ralph (Norfolk, N.)

      Channon, Paul

      Fox, Marcus

      Hunt, John

      Chapman, Sydney

      Fry, Peter

      Hutchison, Michael Clark

      Chataway, Rt. Hn. Christopher

      Galbraith, Hn. T. G. D.

      Iremonger, T. L.

      Gardner, Edward

      Irvine, Bryant Godman (Rye)

      730

      731

      James, David

      Morgan-Giles, Rear-Adm

      Speed, Keith

      Jenkin, Patrick (Woodford)

      Morrison, Charles

      Spence, John

      Jennings, J. C. (Burton)

      Mudd, David

      Sproat, Ian

      Jessel, Toby

      Murton, Oscar

      Stainton, Keith

      Johnson Smith, G. (E. Grinstead)

      Nabarro, Sir Gerald

      Stanbrook, Ivor

      Jones, Arthur (Northants, S.)

      Neave, Airey

      Stewart-Smith, Geoffrey (Belper)

      Joseph, Rt. Hn. Sir Keith

      Noble, Rt. Hn. Michael

      Stodart, Anthony (Edinburgh. W.)

      Kellett-Bowman, Mrs. Elaine

      Nott, John

      Stoddart-Scott Col. Sir M.

      Kershaw, Anthony

      Onslow, Cranley

      Stokes, John

      Kimball, Marcus

      Oppenheim, Mrs Sally

      Stuttaford, Dr. Tom

      King, Evelyn (Dorset, S.)

      Orr, Capt. L. P. S.

      Sutcliffe, John

      King, Tom (Bridgwater)

      Osborn, John

      Tapsell, Peter

      Kinsey, J. R.

      Owen, Idris (Stockport, N.)

      Taylor, Sir Charles (Eastbourne)

      Kirk, Peter

      Page, Rt. Hn. Graham (Crosby)

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

      Knight, Mrs. Jill

      Page, John (Harrow, W.)

      Taylor, Frank (Moss Side)

      Knox, David

      Parkinson, Cecil

      Taylor, Robert (Croydon, N.W.)

      Lambton, Lord

      Peel, John

      Tebbit, Norman

      Lamont, Norman

      Percival, Ian

      Temple, John M.

      Lane, David

      Pike, Miss Mervyn

      Thatcher, Rt. Hn. Mrs. Margaret

      Langford-Holt, Sir John

      Pink, R. Bonner

      Thomas, John Stradling (Monmouth)

      Le Marchant, Spencer

      Pounder, Rafton

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

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

      Price, David (Eastleigh)

      Thompson, Sir Richard (Croydon,S.)

      Loveridge, John

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

      Tilney, John

      Luce, R. N.

      Proudfoot, Wilfred

      Trew, Peter

      MacArthur, Ian

      Pym, Rt. Hn. Francis

      Tugendhat, Christopher

      McCrindle, R. A.

      Raison, Timothy

      Turton, Rt. Hn. Sir Robin

      McLaren, Martin

      Ramsden, Rt. Hn. James

      van Straubenzee, W. R.

      Maclean, Sir Fitzroy

      Rawlinson Rt. Hn. Sir Peter

      Vaughan, Dr. Gerard

      McMaster, Stanley

      Redmond, Robert

      Vickers, Dame Joan

      Macmillan, Rt.Hn.Maurice(Farnham)

      Reed, Laurance (Bolton, E.)

      Walder, David (Clitheroe)

      McNair-Wilson, Michael

      Rees, Peter (Dover)

      Walker-Smith, Rt. Hn. Sir Derek

      McNair-Wilson, Patrick (New Forest)

      Rees-Davies, W. R.

      Wall, Patrick

      Maddan, Martin

      Renton, Rt. Hn. Sir David

      Walters, Dennis

      Madel, David

      Rhys Williams, Sir Brandon

      Ward, Dame Irene

      Marples, Rt. Hn. Ernest

      Ridley, Hn. Nicholas

      Warren, Kenneth

      Marten, Neil

      Ridsdale, Julian

      Weatherill, Bernard

      Mather, Carol

      Rippon, Rt. Hn. Geoffrey

      Wells, John (Maidstone)

      Maude, Angus

      Roberts Michael (Cardiff, N.)

      White, Roger (Gravesend)

      Maudling, Rt. Hn. Reginald

      Roberts, Wyn (Conway)

      Wiggin, Jerry

      Mawby, Ray

      Rodgers, Sir John (Sevenoaks)

      Wilkinson, John

      Maxwell-Hyslop, R. J.

      Rossi, Hugh (Hornsey)

      Winterton, Nicholas

      Meyer, Sir Anthony

      Rost, Peter

      Wolrige-Gordon, Patrick

      Mills, Stratton (Belfast, N.)

      Russell, Sir Ronald

      Wood, Rt. Hn. Richard

      Miscampbell, Norman

      St. John-Stevas, Norman

      Woodhouse, Hn. Christopher

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

      Scott, Nicholas

      Woodnutt, Mark

      Mitchell, David (Basingstoke)

      Scott-Hopkins, James

      Worsley, Marcus

      Moate, Roger

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

      Wylie, Rt. Hn. N. R.

      Molyneaux, James

      Shelton, William (Clapham)

      Younger, Hn. George

      Money, Ernie

      Simeons, Charles

      Monks, Mrs. Connie

      Sinclair, Sir George

      TELLERS FOR THE NOES:

      Monro, Hector

      Skeet, T. H. H.

      Mr. Michael Jopling and

      Montgomery, Fergus

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

      Mr. Hamish Gray

      More, Jasper

      Soref, Harold

      Morgan, Geraint (Denbigh)

      Question accordingly negatived.
      It being after Nine o'clock, The CHAIRMAN proceeded pursuant to Order [14th November], to put forthwith the Question necessary for the disposal of the Business to be concluded at that hour.
      Clause 4 ordered to stand part of the Bill.

    Clause 5

      OFFENCES
      Mr. Eric S. Heffer: I beg to move Amendment No. 104, in Clause 5, page 3, line 28, leave out subsection (1) and insert:
      `(1) A person who contravenes any of the provisions of section 2 of this Act, other than subsections (2) and (5)(b), shall be liable on summary conviction to a fine not exceeding £400 and on conviction on indictment to a fine'
      The Temporary Chairman: With this Amendment we are to discuss the following Amendments:
      No. 100, in page 3, line 29, after "2" insert:
      '(1), (3), (4), (5)(a) and (5)(c)'.
      No. 45, in page 3, line 29, after "Act" insert 'except subsection (2)'.
      No. 41, in page 3, line 30, leave out '£400' and insert:
      '£4,000, and not less than £400'.
      No. 42, in page 3, line 32, at end insert:
      'not less than £5,000, nor in excess of £50,000'.
      No. 88, in page 3, line 33, leave out subsection (2) and insert:
      '(2) If an employer contravenes the provision of section 2(2) of this Act he shall be liable to pay a sum equal to the increase in his wage and salary bill which results

      733
      from such contravention as a surcharge on his employees' National Insurance contributions, such surcharge to be deducted from his employees' pay'.
      No. 56, in page 3, line 34, leave out from 'person' to second 'a' in line 35 and insert:
      'aids, abets, counsels or procures'.
      No. 101, in page 3, line 36, after '2', insert:
      '(1), (3), (4), (5)(a) and (5)(c)'.
      No. 46, in page 3, line 36, after 'Act', insert 'except subsection (2)'.
      No. 89, in page 4, line 11, leave out subsection (4).
      No. 90, in page 4, line 23, leave out subsection (5).
      No. 91, in page 4, line 28, leave out subsection (6)'.
      No. 92, in page 4, line 36, leave out subsection (7)'.
      No. 105, in page 4, line 40, leave out from 'conspiracy' to end of line 42 and insert:
      'or to any other liability in tort'.
      No. 93, in page 4, line 43, leave out subsection (9).
      Mr. Heffer: This will probably be the last debate in this Committee stage.
      The Government's introduction of the guillotine, curtailing our debates, has led to a very serious situation for this Committee. During the last few days following our experience with the European Communities Bill and now this one, on which we were guillotined even before the Bill went into Committee, many hon. Members have begun to think that our activities in the House are largely a waste of time because the Government have decided to railroad through their legislation without proper debate or discussion. They want this Parliament to be merely a rubber stamp for the legislation. The House and the country must take note of this in the forthcoming period.
      In this amendment we accept the control of prices while we argue against the control of freely-negotiated wages. This raises the important question of the wage element in inflation. To put it another way, is it true that the trade unions cause inflation with their wage demands? The Government and some economists argue that this is the basis of the present inflation. Conversely many economists in
      734
      this country, amongst them some well-known Conservatives, argue and have argued in the pamphlet "Memorial to the Prime Minister":
      "There is no evidence that the power of the trade unions has caused or can cause continuing inflation without a concomitant increase in the money supply."
      One can argue that the point about money supply is one that we obviously have to go into in greater depth.
      I do not accept all of the argument advanced by the hon. Member for Oswestry (Mr. Biffen) and the right hon. Member for Wolverhampton, South-West (Mr. Powell), but the pamphlet goes on to say:
      "Trade unionism no matter how militant or monopolistic cannot do much to change the percentage of the national income that goes on net wages and salaries."
      Appendix 2 shows how little the percentage has changed. In fact, according to a chart in the document, the take-home percentage in wages of the national income has declined since the years 1956, 1957 and 1958.
      Again, the pamphlet "Do Trade Unions Cause Inflation", by Dudley Jackson, Professor Turner and Frank Wilkinson argues that whereas the unions contribute to the inflationary process to a certain extent, almost everything causes inflation in the modern economly.
      These introductory remarks are related to Amendment No. 104. The point is that despite the fact that a series of economists, both Left-wing and Right-wing, have said that there is no hard evidence to suggest that trade unions and wage demands cause inflation, the Government claim to know better. They have argued consistently for a number of years that the present inflation has been based on wage demands by the unions. They claim to know the position. In reality, they have never produced any evidence to support that claim.
      Mr. Gower: Does not the hon. Gentleman agree that the remark "One man's wage increase is another man's price increase" did not stem from this side of the Committee?
      9.15 p.m.
      Mr. Heffer: The hon. Gentleman is referring to the speech of my right hon. Friend the former Prime Minister. It is well known that I have not always agreed

      735
      with my right hon. Friend. I do not claim to defend everything that was said or done during the period 1964–70. We are now discussing the present Government. Neither they nor any other Government have provided hard evidence that inflation has been caused by trade union demands for increased wages. In this connection I shall refer to three factors, all of which contain little wage element, that have been responsible in the past for inflation and price increases.
      The first factor is rent increases. Those increases, whether or not they amount to £1 or, taking into account a mythical rebate, to 50p, were the deliberate policy of the present Government. Thus, they alone are responsible for the resultant inflation.
      The second factor concerns house prices, land speculation and the problem of old houses, some of which were built 50, 60, 100 or even 200 years ago. There is little or no wage element in relation to those house prices, because the joiners, bricklayers and plasterers concerned in building them are long since dead. It cannot therefore be argued that their wage increases are responsible for housing or land speculation.
      Food prices have gone up by 21·7 per cent. since the Government came into office. Is that due to the inflationary pressure of the farm workers? They were awarded a wage increase, which they will not now receive until the end of the freeze, which was to enable them to catch up with the increased cost of living. They have not forced up the cost of food.
      It might be argued that there have been external factors. I have heard it said in the House of Commons that inflation is due entirely to external factors. If that is so, and if the price of food has gone up because of world increases in food prices, our farm workers cannot be blamed. Nor can the higher wage earners be blamed. Therefore, it is clear that the three aspects I have mentioned are all factors in the inflationary spiral. The wages element has been introduced by the Government to blame their own failures on the trade unions, so that they themselves could escape the just criticism of the British people.
      Our Amendment No. 100 is designed to ensure that subsection (2) of the Clause is removed. The subsection is aimed at
      736
      the trade unions and employers' organisations which may seek to grant increased wages and other conditions that have been freely negotiated. A trade union or, since the Industrial Relations Act—
      "an organisation of workers or organisation of employers or any other organisation"—
      whatever that may mean; it is a vague statement and opens up the widest possible interpretation—
      "or person"
      who
      "takes, or threatens to take, any action with a view to compel, induce or influence a person to contravene any of the provisions of section 2 of this Act"
      could be fined either £100 or an unlimited fine on conviction.
      There is no doubt that it is the trade union movement, the organised working-class movement, which is likely to be the greatest sufferer under that provision. We could ask whether the Government will be stupid enough to take action against workers who might become involved in strikes or other forms of industrial action. I ask that question because it has a definite relevance to a number of situations that are developing. I cite two examples, one in South Wales and the other in Liverpool. Both these difficult situations are arising out of productivity agreements
      In Liverpool there is a factory which has had very little industrial strife. It has a progressive productivity scheme which is applied to every section of the factory except the toolroom. That section will not have it applied—it was to come into operation in two weeks' time—because of the Bill. Yet the workers in the other parts of the factory and the toolroom are doing similar jobs requiring similar skills. Thus the toolroom workers are likely to take industrial action. If they do so, under the clause those workers can become liable for fines. If they refuse to pay the fine they are liable for imprisonment.
      In South Wales there is a highly productive factory with a good export record. Seventy per cent. of the workers in that factory have gone over to an agreement; the other 30 per cent., caught as a result of the freeze, are on the production line. One can imagine the effect on the production line when they realise they are caught under the Act.

      737
      The legislation the Government have brought in is a further example of the repressive legislation to which we have become accustomed since they came into office. Their whole philosophy seems to be based on forcing people, especially working people, to accept the Government's dictates. It has not always been like that. This Government have faced different situations. The hon. Member for Oswestry said the other night that quoting past speeches did not help very much. It certainly did not help the Government very much.
      The Prime Minister made a speech on 3rd August, 1966, to which I must refer, because it shows how the leader of the country is standing on his head and that he is totally politically dishonest. The Prime Minister said:
      "These provisions cannot be justified in ordinary peace-time conditions, … we are utterly opposed to it. It is not in that direction that greatness for this country lies. This is the divide between us …".
      He said that the freeze would lead
      "to compulsion, to the complete control of the economy … and to increasing restrictions on personal liberty, to a freeze on everything, including, above all, a freeze on progress."—[OFFICIAL REPORT, 3rd August, 1966; Vol. 733, c. 502.]
      That is proof that the Government are a bunch of political hypocrites. When they are out of office right hon. and hon. Members opposite say that they are not prepared to introduce statutory legislation and then they try to slide it in, pretending that they have always believed in such legislation, without any real justification for what they are doing. It is no good the hon. Member for Birmingham, Edgbaston (Mrs. Knight) shaking her head. I do not know whether the hon. Lady was in the House at that time.
      Mrs. Jill Knight Mrs. Jill Knight (Birmingham,
      Edgbaston) rose—
      Mr. Heffer: I withdraw my implied invitation to the hon. Lady to intervene. [HON. MEMBERS: "Disgraceful!"] Right hon. and hon. Gentlemen opposite do not like it when they are reminded of what they said and did.
      I conclude my remarks by drawing attention to the type of wording that we are trying to eliminate. It is reminiscent of parts of the Industrial Relations Act. It contains the same phraseology, the
      738
      same legal language. The other day the Daily Telegraph said that the former Solicitor-General was the legal linkman—and he is certainly the legal linkman between the Industrial Relations Act and this Measure. We are faced with the right hon. and learned Gentleman's rather mean, uncompromising, relentless legalistic attitude. I am referring not to the present Solicitor-General, but to the previous one; I am talking of the ex-Solicitor-General. So we will get used to the same sort of attitudes with this that we got during that period.
      9.30 p.m.
      I have long believed that if one introduces compulsory penal legislation undermining the whole basis of freely negotiated trade union agreements, one takes the country towards the corporate State concept. One would be trying to slip the trade unions into a slot, where their position is clearly marked out, where the employer's position is clearly marked out, where the trade unions became nothing but an organ of the State, instead of carrying out their proper function of fighting for wage increases as free trade unionists.
      That is what is happening. I am not saying anything different from what I have often said. The Government are saying that the Bill is a temporary measure. Every Government which has undermined democracy has always done this kind of thing as a temporary measure. Governments say that it will last for only a short time, but it builds up. It is made worse because we know the second phase is coming. This is the first phase. If some Government supporters who believe as we do had the guts, courage and determination to fight the Bill, as some of us were prepared to argue against some Labour Government legislation, there would not be the same danger to the democratic process.
      I ask the Committee to support the amendments. We must have a free trade union movement and we must have free bargaining. The Bill takes them away, temporarily or permanently. It is a serious blow to the democratic rights and principles of the people.
      Mr. Michael Grylls: Listening to the hon. Member for Liverpool, Walton (Mr. Heffer) one might have imagined that his was the only signature

      739
      on the amendment. If it had been—and I make this point in all seriousness—one would have listened to him with more respect. However, it has five signatures of members of the Labour Government.
      When the hon. Gentleman tries to convince us that there is no relationship between wages and prices, he is on extremely shaky ground. The fact that there is a direct correlation in both directions, between prices and wages and wages and prices, was accepted by Labour Members when they were in office.
      To illustrate that I should like to quote from their own White Paper, Cmnd. 3590. On page 7, concerning incomes, it states:
      "… substantial restraint is required over the next two years, and the Government propose to take power to delay increases … up to 12 months."
      That is fairly good proof that the right hon. Member for Leeds, East (Mr. Healey), who has also signed the amendment, as a member of the previous Government, thought that there was a direct connection between the two; otherwise why put that into the White Paper?
      Paragraph 41 of the White Paper states:
      "Pay increases based on a rise in the cost of living are not justified under the criteria, and should not be conceded."
      The Prime Minister's proposals to the TUC and the CBI were to be linked with a threshold agreement which would have covered the rise in the cost of living.
      The White Paper goes on to say:
      "Not only would this be self-defeating since it would result in further increases in costs and prices, but it could set off a wage-price spiral that would damage our competitive position."
      That seems to be absolute proof that, whatever the hon. Gentleman—I respect his individual position in the last Parliament on this matter—now says from the Opposition Front Bench, it was certainly not the view of his party. The Labour Party accepted this, and any right-thinking person, irrespective of party, must see that there is a connection. This is the problem facing the country now. The difference between 1969 and now is that the economy is expanding. There is a real increase in the national wealth and we have managed to reduce taxes substantially.
      740
      The hon. Gentleman mentioned the issue of land prices. Of course, they are a worry to everybody, but it is very easy to describe something as disgraceful and not put forward any proposal to deal with it. The fact is that, although land and house prices have risen fast since the end of the war, the only way to deal with the problem is to see that more land is released and more houses are built so that the demand is satisfied.
      Is the hon. Member for Liverpool, Walton suggesting that land prices should be permanently controlled? He posed a problem which we all understand and appreciate. He has not told us whether they should be controlled. If he wants to control land prices, what does he think the result would be? I should be very interested to hear whether he has a solution.
      Mr. Heffer: I do not want to waste the Committee's time, but the Opposition's attitude was clearly explained by my right hon. Friend the Member for Grimsby (Mr. Crosland) this afternoon in the debate on the question of housing and land. If the hon. Gentleman had been here, he would have heard what my right hon. Friend said.
      Mr. Grylls: I was not here, but I am still eager to hear from the hon. Member for Liverpool, Walton whether he thinks that land prices should be controlled.
      The Temporary Chairman: Order. I hope that the Committee will not pursue the argument of land prices. I am having a little difficulty in seeing in which amendment land prices are specifically mentioned.
      Mr. Grylls: I accept your admonition, Miss Quennell, but I was led into this channel by the hon. Member for Liverpool, Walton, who spoke about land prices early in his speech.
      I believe that the majority of the members of the CBI and TUC and the vast majority of the people in this country want to get on with the Bill so that the freeze can be over as quickly as possible.
      The fines and penalties for people who do not observe the Act are perfectly properly put in as they are because the vast majority of those in the CBI and TUC—employers and employees alike—will

      741
      respect the national interest and show self-restraint. Employers and a vast number of trade unionists understand the problem, they understand why the Government have taken decisive action, and they look forward to the moment when the freeze ends so that an agreement can be negotiated to allow wages to go ahead and the cost of living kept down.
      Mr. Loughlin: There is one statement by the hon. Member for Chertsey (Mr. Grylls) with which we all agree—we are all concerned about inflation and its effect on the nation. There is no argument about that; we differ only on the cause of inflation. It has been the emphasis that has been laid upon wage cost inflation by the Government that has created the difference between us. Every hon. Member must recognise that Britain is not a high wage economy. Although there has been a degree of improvement in wages in Great Britain compared with EEC countries, they are still 25 per cent. lower. That calculation is based on the hourly labour costs—the total labour costs including insurance—according to an independent and objective survey carried out on average wages in Europe.
      It is the constant emphasis by the Tory Party on high wages as a cause of inflation that creates the difference between the parties. Later I shall seek to show some of the wage rates that apply and about which people will be prosecuted.
      There has been a whole series of debates today. From them have emerged two observations. The greater proportion of hon. Members who have listened to the debates could not have escaped the conviction that it would be nigh impossible for the Government to implement any policing or action against increases in prices. Even listening to Front Bench spokesmen one has had the impression that the Government want voluntary action in respect of prices. The hon. Gentleman on the Front Bench nods his head in agreement, that when it comes to wage restraint by trade unions and workers voluntary action is not good enough.
      We have had an admission from the Government that under this legislation it would be impossible to catch builders, whether or not they were speculators; it was impossible to curb the activities of land speculators, irrespective of how they
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      abused a situation. We now have the position clearly defined. The Bill allows for only a voluntary price freeze. It allows for no freeze in house and land prices.
      Mr. Arthur Lewis: Or food.
      Mr. Loughlin: I shall come to that in a moment.
      Mr. Grylls: The penalties are exactly the same if people contravene the provisions about prices as if they contravene those about wages. Incidentally, that is also true about dividends: if a company declares a higher dividend, it will be committing an offence.
      [Mr. E. L. MALLALIEU in the Chair]
      9.45 p.m.
      Mr. Loughlin: Technically that may be so. But the Committee has examined how to ensure policing and action on prices. It has been almost freely admitted, even by Front Bench spokesmen, that there cannot be any guarantee that the Bill will control prices except by voluntary action on the part of the organisations concerned, which applies to land prices and those of houses.
      The Bill excludes foodstuffs. I am glad to see the new Under-Secretary of State for Agriculture, Fisheries and Food on the Front Bench. I have already congratulated her in private; and I now congratulate her in public. She knows that meat, fish, vegetables, fruit and a great amount of other food is excluded and so will not be controlled.
      When my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) referred to Clause 5(2) I said, "We have been here before", because this is similar to the Section in the Industrial Relations Act. Clause 5(2) says:
      "If an organisation of workers or organisation of employers, or any other organisation or person"—
      that was excluded from the Industrial Relations Act—
      "takes, or threatens to take, any action with a view to compel, induce or influence a person to contravene …"
      Subsection (6) imposes similar conditions upon people who are alleged to be defined, but who could be described as a secretary? What is a secretary? Is a secretary a general secretary of a union or a secretary of a branch? I cracked

      743
      a gag about the Solicitor-General because I felt that my hon. Friend was accusing him of something he had never done. But precisely how will he have the audacity to try to implement these provisions? I declare an interest. I am an official of the Union of Shop Distributive and Allied Workers. Yesterday, we had many speeches about the agricultural workers, and I agree that they should have a wage increase. Is the hon. and learned Gentleman to apply either of these two provisions to a person who induces agricultural workers to try to obtain an increase in wages? It is an offences to try not only to obtain a block increase in wages, but to induce a person.
      If an agricultural worker says to an employer, "If you do not give me another £2 I shall leave", will the Government prosecute him? If it happens to be a general secretary of a union who is doing the inducing or the influencing, will the Government prosecute him, even though he might be acting outside his official capacity? How many people does the hon. and learned Gentleman think will go to gaol if this part of the Bill is implemented? We shall have a situation precisely similar to the situation we had with the Industrial Relations Act. People will be put into goal, as I said would happen under the Industrial Relations Act, even though the Minister for Trade and Consumer Affairs, then Solicitor-General, said that it would not happen.
      Which Minister would apply the Bill to the 120,000 of my union's members who are engaged in the multiple grocery trade? We have an agreement applicable to all provincial towns. It is known as "Provincial 'A' grade". It is for £14 per week at 22 years of age. It provides that within the first six months of the employment of an individual that £14 may be reduced by 50p.
      Some Government supporters represent similar constituencies to mine, with a country area and a multiplicity of townships and villages. In title towns of 5,000 and 6,000, Provincial 'A' does not apply; Provincial 'B' applies in those towns, and the rate is £13·65, with a similar provision that for the first six months it may be reduced by 50p. What hon. Member would have the audacity to prosecute someone for inducing me to get
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      an increase in wages for a man whose wage was £14 a week, and who was living in a large town, or earning £13·65 and living in a small town?
      It is no good hon. Members on the Government side talking about the family income supplement and rent rebates. I remember the incident during yesterday's debate when it was pointed out to a rich hon. Member that it is the poor who do not challenge and that it is the poor who do not want to let anyone know they are poor. One of the reasons why there is such a low take-up of family income supplement and a low take-up, if one discounts supplementary benefit, of rent rebates is precisely that. The members of my union do not want anyone to know that they are poor. They would rather suffer their poverty than the indignity of going cap in hand to someone else.
      I do not want to be personal—I have as many vices as anyone has—but I remind the Committee that there are hon. Members who would spend more than £13·65 on taking the wife out for a meal. What is more, they take the wife out for a meal not once every six months but, more likely, once a week, spending that amount on each meal. I do not criticise them—I take my wife out and we have a good meal sometimes—and I am not being personal in any way. But how can we as Members of Parliament put into effect legislation designed to impose penalties on those who attempt to influence or induce someone to give a working person an increase on the rates to which I referred a moment ago?
      Mr. Tom King: The hon. Gentleman is making a powerful case on behalf of the lower-paid. Can he honestly envisage any group in our society who have suffered more than that group from the effects of inflation, and can he wish for them anything other than the set of measures which could have been reached, but which sadly were not, to establish a voluntary agreement specifically designed to help the lower-paid?
      Mr. Loughlin: I saw the antics of the hon. Member for Bridgwater (Mr. Tom King) on the Industrial Relations Bill. I do not believe that he has the slightest sympathy—
      Mr. Gower: Answer the question.
      Mr. Loughlin: I shall answer it. I have never yet failed to answer a question from the hon. Gentleman. I do not believe he has the slightest sympathy for the working classes. If he had been listening, he would have heard the answer in the first three minutes of my speech: that the difference between the two sides is that hon. Members on the Government side argue that we have a high wage-cost inflation, whereas we know that is not so. That is his answer
      Mr. King: It is no answer.
      Mr. Arthur Lewis: Who caused the inflation? It was the Tory Government.
      Mr. Loughlin: I do not want to be prompted, because if we get on to that track I shall point out who will be causing further inflation next year with VAT, food price increases, rent increases and the rest.
      Any Minister who introduces legislation of this kind threatening to put into prison—that is what it comes to—men who seek to influence or induce an improvement in the standard of life of the people to whom I have referred is not even worth looking at, let alone listening to.
      10.0 p.m.
      Mr. Gower: I can hardly believe that the hon. Members for Liverpool, Walton (Mr. Heffer) and Gloucestershire, West (Mr. Loughlin) would ask the Committee to accept that they believe there is no connection between increases in earnings and the inflationary tendency from which we have suffered in recent years. That has not been the belief of their party over the last 10 years, including the last seven years when they were in office. They introduced the most elaborate system of detailed controls to deal with increases of that kind.
      The hon. Member for Walton knows perfectly well that what happened under the last Labour Government has happened under the present Government, that annually, or at shorter intervals, certain groups have come forward and asked for more. I make no invidious distinctions between those groups, which have included airline pilots earning fairly large salaries, railway workers and coal miners. There have been various degrees of need in these claims. The hon. Gentleman knows that within a few months of such
      746
      increases, perhaps six months, the employers including the Post Office, British Rail and all kinds of organisations, nationalised industries as well as private industry, have said that they must increase their prices as they have bigger outgoings because of the last wage claim.
      I do not know what the Opposition think, but my impression is that people are fed up with these annual claims. They are completely fed up with inflation, which has existed for many years and is not always set-off by the needs of particular elements. The Opposition may boast that they did many things when in Government to ease the social conditions of the lower-paid. They may say that they took steps to introduce benefits to lessen the impact of claims for increases, but they had singularly little impact on the claims which were made.
      The hon. Member for Walton does not realise what a nonsense he would make of the Bill if Amendment No. 104 were incorporated. There is to be a standstill for a limited period, but the hon. Gentleman was talking as though this was a permanent measure to prevent any improvement in the position of the lower-paid. The hon. Gentleman knows that it is not such a measure. It is a temporary and, I hope, relatively short-lived measure, which includes terms and provisions for the temporary ending of price increases in certain phases of the retailing of goods and services. It also includes provisions for a period when there shall be no increase in dividends and no increase in the price of certain goods. As the hon. Gentleman pointed out, it includes provisions for a period during which there shall be no increase in certain earnings.
      If the Amendment No. 104 is carried, we shall have the ridiculous situation that if a person increases the price of certain goods he will have the sanction of the law against him. Likewise, if a person increases dividends he will have against him the sanction of the law. But if a person breaks the provisions of the Bill and puts up the earnings of a group of people, he will not have against him the sanctions of the law. That would make an absolute nonsense of the Bill.
      The second amendment gees further. It proposes to take out of the Bill that part which places an embargo for a

      747
      limited time on increases in certain earnings. If the amendment were accepted it would restore the position we have had during the last 12 months or so, when we have had, across a fairly wide range, a voluntary control of certain prices by the CBI.
      Mr. Arthur Lewis: Is not the hon. Gentleman aware that the Government themselves are the biggest culprit in this respect? I believe that they have already decided to break the Bill when it becomes an Act, because the present Parliamentary Commissioner, the ombudsman, will have an increase in salary, but it will not be given until after this measure is enacted. It will then be given on the excuse that he has had extra work put on him by having to deal with the National Health Service. If this had been done by the workers, the Bill would have had its effect on them, but in the other case the Government can do this.
      Mr. Gower: We know that the Bill is not perfect, and we have already admitted that it is a very rough and blunt instrument, but the increase in the salary of one individual like the ombudsman could have no effect at all—[HON. MEMBERS: "Oh."]—but the whole range of increases in the prices of commodities, goods and earnings referred to in the Bill can have a cataclysmic effect. The purpose of the Bill is to deal with the main problem that has faced the country for many years, and I believe that acceptance of either amendment would destroy its credibility.
      The hon. Member for Gloucestershire, West was most unfair in suggesting that
      748
      my hon. Friend the Member for Bridgwater (Mr. Tom King) or any of my hon. Friends hoped to preserve the unhappy position of some of the lower-paid workers. The truth is that the worst thing that could happen for these workers is a continuation of the inflation from which we have suffered, and the best thing that could happen for them is the ending of inflation.
      The lowest-paid will be the prime and first beneficiaries of the Bill's success. They will benefit more than will the higher-paid. Whatever the merits of the proposals put forward a little while ago by the Prime Minister, they had the supreme merit, from the point of view of a Socialist, that they would have conferred a much greater benefit on the lower-paid than on the higher-paid. Those proposals would have conferred a proportionately much larger benefit on the man earning £20 a week than on the company director earning £3,000 a year. I am astonished that a Labour Opposition could have opposed, or appear to oppose, a provision so eminently favourable to the lower-paid.
      I sincerely hope that the need for this kind of Bill will be relatively short lived. I hope that the legislation which will be designed to supersede it or fortify it will not have some of the imperfections of these temporary provisions. But I am astonished that Labour Members should speak in such terms of a measure which will be of the greatest benefit to the very people, the lowest-paid, whose cause they plead.
      Mr. William Hamilton: We are discussing what is probably the most serious problem facing the country today, and it would be foolish and dishonest for anyone on this side to pretend that there is not a relationship between prices and incomes of all kinds. I am a passionate believer in obeying the law, no matter how offensive it may appear to one section of the community or another. If the House makes a law, that law should be obeyed, but if we are to accept that proposition we must treat offenders against the law with much more seriousness than the Bill appears to treat them. That is why I have put down two Amendments relating to the fines for offences against the prices and incomes control. There have been very few speeches directly related to the Amendments so far and I wish to confine my remarks to my Amendments.
      Clause 5(1)(a) says in specific reference to prices that a company on summary conviction for fraud for defying the law is subject to a fine not exceeding £400. We have only to look at the newspapers to see the enormous companies in this country, companies like Cadbury-Schweppes or Boots. Such companies are being told that if they flout the law it will cost them a maximum fine of £400. Either the Government are serious or they are not serious about their intentions. My Amendment contains a purely arbitrary figure of £4,000 fine, and that would take account of the very inflation at which the Bill is aimed.
      The Government err in the opposite direction. Clause 5(2)(b) says that offenders shall, on conviction on indictment, be liable to a fine of unspecified quantity. That fine may be £10, because there might be mitigating circumstances, or it might be £500,000. We should be more precise about such things if we are to be serious.
      I object very much to the tripartite talks between the three establishment sections of the community—the TUC, the CBI and the Government—from which the House of Commons is excluded. Now it is our turn to come in and clean up the process after those three have gone through the motions of trying to achieve a phoney agreement. Not one of those three could deliver the goods without ultimately coming to Parliament. The
      750
      Government knew that neither the TUC nor the CBI could deliver and they knew that they themselves could not deliver unless and until they came to the House. That is what they are doing now.
      The talks were bound to fail and the Government knew it. This covers the point raised by the hon. Member for Bridgwater (Mr. Tom King) who intervened in the speech of my hon. Friend the Member for Gloucestershire, West (Mr. Loughlin). My brother is an organiser in the union to which he referred and he knew that if they had accepted the £2 flat-rate increase, which was allegedly to help the lower-paid workers, hundreds of thousands of those workers would have been worse off in the event.
      Government intervention in this sphere is inevitable on an increasing scale and if the Minister were to be consistent he would read his speech tonight standing on his head, because that is what the Government have done for the last two years after telling people to stand on their own feet and that the free market would solve all the problems.
      The Government have now come to face the realities and we in the Labour Party will have to face them if we become the Government again, despite all that our Front Bench says now. I would not have the nerve, if I had been a member of the Labour Government, now to oppose the principle of what is being done. We must face the fact that Government intervention in large measure will solve this problem, not the free play of the market—whether it be on the trade union side or the employers' side.
      10.15 p.m.
      Mr. Pardoe: The speech of the hon. Member for Liverpool, Walton (Mr. Heffer) was a most remarkable performance. I felt rather like Oscar Wilde, who said of someone or other, "I only wish I could be as certain of anything as that man is of everything." The hon. Gentleman clearly stated his belief that there is no connection between wage levels and inflation. He said quite categorically that trade unions cannot cause inflation, and he quoted some Conservative pamphleteers—
      Mr. Heffer: Let us have absolute honesty. I said nothing of the sort. I

      751
      quoted a group of economists who argued that wage demands and trade unions were not responsible for inflation. I then quoted another group of economists, Left-wing economists, who admitted that there was a connection between wages and inflation but said that in our modern society inflation was caused by just about everything, and that the basic, underlying reason was not wages alone. I said that the Government were certain, because they said that it was wages alone.
      Mr. Pardoe: I shall be very interested to read the hon. Gentleman's speech in HANSARD tomorrow, unless he has changed it in the meantime. I listened to it very carefully and honestly did not think that anyone who heard it could possibly believe the interpretation the hon. Gentleman has now put upon it.
      Mr. Heffer: On a point of order, Mr. Mallalieu. I think that I deserve the protection of the Chair in the interests of the House. I never change my speeches. I never go up to the HANSARD office to see whether they are correct. In fact, the other day my hon. Friend the Member for Aberdeen, North (Mr. Robert Hughes) drew my attention to an obvious slight misinterpretation of something I had said. Therefore, the hon. Gentleman should withdraw the imputation that I go up to the office to change my speeches or even to attempt to change them.
      Mr. Pardoe: I do not suppose that the hon. Gentleman ever goes to read his speeches. Some of us would wish that he did.
      Mr. Heffer: On a point of order—
      The Second Deputy Chairman (Mr. E. L. Mallalieu): Order. Can the hon. Gentleman assure me that it is a point of order?
      Mr. Heffer: I am asking for the hon. Gentleman to withdraw the imputation that I was prepared to change my speeches in the HANSARD office. I want a withdrawal from the hon. Gentleman.
      Mr. Pardoe: What I have now from the hon. Gentleman is a categorical assurance that he will not change his speech; I only wish that he would.
      Mr. Arthur Lewis: On a point of order. I have been a Member for long enough to know that there is a number of rules and regulations in the Standing Orders as well as the customs and practice of the House. As you know, Mr. Mallalieu, the custom and practice is that no one, but no one, can alter the OFFICIAL REPORT, though it is permissible to have the text corrected in draft. Therefore, what the hon. Member for Cornwall, North (Mr. Pardoe) has said contains a reflection upon the HANSARD reporters and the officials of the House, in suggesting that anyone can alter a speech. I ask you, Mr. Mallalieu, to ask the hon. Gentleman to withdraw what he said, because no hon. Member is allowed to alter a speech. This I can say on the basis of 28 years' experience.
      The Second Deputy Chairman: I did not notice any such reflection.
      Mr. Pardoe Mr. Pardoe rose—
      Mr. Michael Foot: On a point of order. Surely there could be no greater imputation against an hon. Member than to suggest that he would go from this Chamber and alter what is to appear in HANSARD. I do not know whether hon. Members would regard such a charge against them as grave, but I should regard it as such. I submit, Mr. Mallalieu, that it is your duty to call upon the hon. Member for Cornwall, North (Mr. Pardoe) to withdraw the charge, if he has any honour at all.
      The Second Deputy Chairman: I think that most hon. Members go up to the HANSARD office to alter their speeches. Which sense of the world "alter" was intended was by no means plain. I heard nothing unparliamentary.
      Mr. Robert Hughes: Further to that point of order, Mr. Mallalieu. I feel that on reflection, Mr. Mallalieu, you will feel that the words used by the hon. Member for Cornwall, North (Mr. Pardoe) were disgraceful. He was not suggesting that slight alterations in the text would be made but that following his speech my hon. Friend would go upstairs to the OFFICIAL REPORT and substantially change the body of the speech. For that imputation to be made by anyone who claims to be liberal is quite disgraceful.
      The Second Deputy Chairman: I do not think that the hon. Gentleman made that imputation.
      Mr. William Price: Further to that point of order, Mr. Mallalieu.
      Mr. Pardoe: In order to—
      Mr. Price: Further to that point of order.
      Mr. Pardoe: In order to save this situation continuing longer, may I say to the hon. Member for Liverpool, Walton (Mr. Heffer) that I did not for a moment suggest that he would change the whole content of his speech. Of course, many hon. Members change the punctuation.
      Mr. Price: That is not what the hon. Gentleman said.
      Mr. Pardoe: I certainly withdraw any implication that the hon. Gentleman has ever changed his speeches. As he has said, he does not go upstairs to read his speeches.
      One of the extraordinary things about the debate is that the speeches on prices and incomes over the last four years have all been the same. They have remained obstinately on the two sides of the Chamber, although the parties have moved backwards and forwards. The only consistent speeches about prices and incomes have come from the Liberal benches, because we have been in favour of a prices and incomes policy since I have been a Member of the House.
      There is nothing new in the link between incomes and inflation. It surely is a link that nearly all of us in the House and surely all sane trade unionists accept. It is a link which was the basis of Keynesian economics. For anyone to suggest that there is not a link between trade union power and inflation they have to answer why it is that real wage rates are 17 per cent. up on the level of a year ago while prices are only 8 per cent. up. They have to answer why there is demand for 17 per cent. more money in order to pay for 8 per cent. more on prices.
      Again, what is the limit to the bargaining power of a group of workers such as the power workers? In a modern industrial society it is virtually unlimited. No Government could bring in the troops, even if they wanted to do so. Heaven forbid that the Government would
      754
      want to do that. But one could not bring troops into power stations for there would be a black-out immediately. They could not run the stations. This closely knit, small group could, if so minded, hold the country to total ransom. Therefore, there has to be some kind of Government control on this sort of unlimited bargaining power.
      I do not wish to enter into that argument as I have already made my position perfectly clear in previous debates. I want to address myself to the specific question of fines and to draw the Government's attention to the amendments, which are linked with the main amendment, standing in the name of my hon. Friends and myself. We aim to remove the whole question of fines from the prices and incomes policy. Sooner or later this will be done, and one Government or another will accept a tax on inflation. It has already become widely accepted—not in the pamphlets of right-wing Conservative economists, but, nevertheless, in fairly moderate circles—that it is perfectly possible to tax inflation, as Amendment No. 87, which has not been selected, suggests. It is possible to increase corporation tax for those companies which increase their prices above the norm, which is in this case a zero norm, as is chosen in the Bill. Similarly, it is perfectly possible to increase National Insurance contributions to cancel out any increases in wages above the norm.
      What one would be saying to the trade union leaders is not, "We shall send you to gaol or fine you if you do your job by exerting your bargaining power to the utmost of your ability", but rather, "Go ahead and exert your bargaining power; but, if you get more than the economy can stand, we shall take it back from your members in increased taxes." That is the way to a sane and sensible prices and incomes policy.
      I put this suggestion forward on this late occasion only because it seems that it ought to be introduced into our prices and incomes debates at this stage. It is a policy to which the Liberal Party is already committed. I am convinced that, together with a larger number of other Liberal policies, it will become widely accepted in time.
      Finally, regarding Amendment No. 93, will the Solicitor-General explain why

      755
      subsection (9) is necessary? Why is it necessary to reserve the right of prosecution under this or, indeed, any other Bill to the Attorney-General?
      I gave evidence in the Peter Hain trial. I do not know whether it did either Peter Hain or myself any good. Anyway, I gave evidence and made it clear throughout that I believed in private prosecution. I believed in Francis Benyon's right to bring that prosecution, although I disagreed fundamentally with his reasons for doing so. It is wrong to pass legislation in which we reserve the right of prosecution solely to the Attorney-General. I suspect that we do it because the legislation is acknowledged by the Government introducing it to be seriously defective and capable of a wide range of interpretation. If that is the reason, I suggest we ought to pass better legislation.
      The Solicitor-General (Sir Michael Havers): I listened with impatience for a while to the opening speech by the hon. Member for Liverpool, Walton (Mr. Heffer). Having looked at his amendments, I did some work anticipating that a serious case would be put forward in their support. Unfortunately, all we got was really another Second Reading speech—the usual knockabout stuff which I quite enjoyed when I first came to the House, but which, after repetition, becomes rather boring. Indeed, instead of anything substantial, we get little more than a snuffle in a thunderstorm.
      The amendment goes back to the fundamental problem of the difference between the Government and the Opposition whether there is to be any control of wages. It must be wrong to exclude wages from the operation of the Bill. This matter was discussed at length yesterday, and, indeed, was dealt with by the vote at the end of the debate.
      The only effect of this group of amendments is to raise again the issue of compulsory statutory control upon prices and companies' dividends, but leaving out wages. I think the policy has been absolutely clear from the beginning: that both sides of industry must bear their share of the burden in the fight against inflation. If that policy were not included in the Bill, it would be seriously defective.
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      The hon. Member for Gloucestershire, West (Mr. Loughlin) raised an important point when he said that the Bill would mean people being sent to gaol. I hope the hon. Gentleman noticed that Clause 5 contains only monetary penalties. There is no question of a gaol sentence.
      Mr. Loughlin: What about default?
      The Solicitor-General: What would happen to a man if a fine was not paid has become clearer over past years. This would not apply to any unincorporated organisation of workers. Fines by magistrates' courts in England and Wales can be enforced under the Magistrates' Courts Act, 1952, by a warrant of distress. Under Section 46 of the Criminal Justice Act, 1967, a magistrates' court can make an attachment of earnings order. A fine can also be enforced by the high court or the county court under the Criminal Justice Act by certain similar methods which would in some cases amount to the attachment of a bank balance or of dividends by charging order.
      I must emphasise the point that, except in certain special circumstances—for example, where a man is already in prison—the court must allow the offender time to pay the fine and thereafter, before committing him to prison, must have inquired into his means and found other methods of enforcement were inappropriate or unsuccessful. A Crown Court has the same power to order imprisonment where a fine is unpaid, but again must take into consideration the same matters as a magistrate's court before committing to prison. What arises here is not whether the Government or the Attorney-General—using the rather loose language of the hon. Gentleman—will send one of his union members to prison. That would only happen if the man was determined to be a martyr, which is a very different matter indeed.
      10.30 p.m.
      The hon. Member for Gloucestershire, West, who referred to 120,000 union members of the multiple retail trade living on the low wages that he described, used the phrase "audacity to prosecute." One wonders what would be the reaction of himself and of any of those 120,000 members of his union if 120,000 retailers put up their prices. This again is an indication of why it can only be right that it

      757
      should be applied right across the board. It cannot be right to have it one sided.
      Coming to the amendments in the name of the hon. Member for Fife, West (Mr. William Hamilton), who, with the frankness that I have come to expect from him, accepted the relationship between wages and prices, said that the restriction of the penalty in the magistrates court to £400 was too small a limitation, and named a number of very large public companies which, he said, would be completely unconcerned by a fine of that kind. Let me tell him this. The sum of £400 is the maximum under the law for a fine in the magistrates court. It would be quite wrong to have a minimum because a minimum would mean that the court could not make an order for less. Every case must not only depend on the facts of the case, which may involve an offence of a very minor character when a fine of £400 would be much too large, but the court has to bear in mind the financial circumstances of the offender.
      This increase proposed by the hon. Member for Fife, West would apply across the board to individuals, to ordinary working men, as well as to the big corporations. In a serious case, involving a very large company, the prosecution would have the right to say "We will not have this case tried summarily. It will go for trial." If it went for trial the fine would be at large. There would be no limit. It has always been the policy of the courts and of Parliament to try not to restrict or fetter the discretion of the courts particularly by imposing a minimum fine or sentence, because there are so many cases where it would be an injustice to the accused to have so large a fine imposed, not only by reason of the nature of the offence but in particular by reason of the financial circumstances of the accused.
      Then there were the interesting amendments in the name of the hon. Member for Cornwall, North (Mr. Pardoe) which I admit have caused me a great deal of hard work and interest during the past two days. They are attractive in this sense, that they seek to avoid any penal consequences arising out of the Bill. In fact, one has to have a penal provision in order to make the Bill bite quickly. But what is proposed here would mean that all that would be lost by the person who
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      contravened the measure would be an amount governed by the extent to which he had contravened it. That would not be enough, in my view, when one considers what sort of offences might be committed.
      There would be difficulties in any event because of the vast administrative set-up that would be required. There would inevitably be a time lag, and the recovery of the surcharge would continue for a long time after the Act had expired. By operating on the overall wages and salary bill, the proposals would open the way to evasion by de-manning, because the amendment is based on the overall wage bill and uses it as a yardstick. Evasion could easily be achieved by firms paying fewer workers more money, and that would create a major enforcement difficulty.
      There would be another problem in that payment by way of surcharge on national insurance contributions would distort the national insurance scheme. A great deal of thought would be required in determining how it would eventually be dealt with.
      My feeling from the debate is that several hon. Members seem to think that the Bill and its provisions will be with us for ever. It is a short-term Bill designed to work for 90 days and, if necessary, for a further 60 days. What is required in the Bill is a simple and effective means of enforcement such as is provided by the criminal courts.
      Mr. Heffer: The Committee understands that it is a short-term Bill, but will the Solicitor-General give an assurance that the penal provisions will not be included in the longer-term Bill that will follow?
      The Solicitor-General: I may be very green, having been in Parliament only for two years, but the hon. Member for Liverpool, Walton knows very well that I can give no such assurance.
      A consideration arising on subsection (7) is the difficulty involved with rents. Rents have been left out of subsection (7) and put into the schedule because they fall into a special category. It is difficult to include rents in the general provisions of Clause 5, and it is much better for the Minister to have power to make the specialised orders necessary to cover the special cases that might arise.

      759
      For the reasons which I have put forward in the short time allowed to me, and particularly because the Bill must be applied fairly and right across the board so that the benefits are felt generally, I advise the Committee to vote against the amendment.
      Mr. Reg Prentice: We extend to the new Solicitor-General our congratulations on having reached this eminent office so early in his parliamentary career, and our sympathies with him on having to make such a bad case at the Dispatch Box so soon after assuming office. I am not being personal, but merely saying that he has, on behalf of his right hon. Friends, to defend a bad Bill.
      In a debate so pregnant with the subject of industrial relations, we might have had at the Dispatch Box the Secretary of State for Employment or one of the Ministers from that Department, none of whom has taken part in the Committee. We are, unhappily, accustomed to Solicitors-General taking part in industrial relations debates. We recall the part played by the previous Solicitor-General in the Industrial Relations Act and in the orders that flowed from it.
      The Solicitor-General's presence underlines the warning given by my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) of the parallel between the penal provisions of Clause 5 and the provisions of the Industrial Relations Act.
      There are differences, and it is interesting to note that in drafting the Bill the Government have taken care, in subsection (8), to preclude actions under the Industrial Relations Act arising from the provisions of the Bill. Nevertheless, the parallel will clearly be seen by trade unionists and by the general public, in the sense that the Bill, like the Industrial Relations Act, can lead to prosecutions of trade unionists, to fines being imposed upon them and, in certain circumstances, to their being sent to gaol.
      The Solicitor-General was careful to explain that a gaol sentence would be avoided in a whole series of circumstances, and we accept that, but he said that "some men might be determined to be martyrs". There are sometimes situations in industrial conflicts when men are prepared to be martyrs, and we have
      760
      recent experience of that. Whether they are right or wrong in their determination to be martyrs is not what we are debating. We are debating whether the Government are wise to create these situations.
      Because of the recent memory of the dock strike in the summer I should have thought that the Government would not want to legislate in this way, because it could lead to the kind of situation that arose over Midland Cold Storage, where the original argument concerned one place and a few dozen men but it escalated into a national industrial crisis. The clause contains the seeds for a conflict of that kind, and it poses a question which the Committee ought seriously to consider. It is the question that has been posed to a greater or lesser extent in most of the amendments that we have debated during the last three days.
      The question is whether the Government really want to resume talks with the TUC on these matters. They say that they do, but if they want us to believe that they ought to recall that the industrial crises during the summer led to deep feelings within the trade union movement which very nearly made it impossible for the TUC to join in the talks that took place with the Government and the CBI. When the TUC members were invited to the talks many trade unionists took the view that a Government whose policies had led to the Industrial Relations Act and all that flowed from it were not the kind of Government with whom trade union leaders ought to have serious talks about the management of the economy. Wiser counsels prevailed, to the extent that the talks did take place, but Ministers ought to recognise the facts of life.
      If the Bill leads to trade unionists being prosecuted and sent to gaol it will be difficult, if not impossible, for trade union leaders, in the foreseeable future, to resume talks with the Government on the problem of inflation. By persisting in getting the clause through as it stands the Government are causing people to question how far they want an agreed solution to the problem. The Government say that that is what they want, but by their attitude to this and other amendments they seem determined to pursue a course that will lead to more divisiveness and, in the long run, to more inflation.
      Question put, That the Amendment be made:—
      The Committee divided: Ayes 255, Noes 290.

      Division No. 14.]

      AYES

      [10.45 p.m.

      Abse, Leo

      Fletcher, Raymond (Ilkeston)

      Maclennan, Robert

      Allaun, Frank (Salford, E.)

      Fletcher, Ted (Darlington)

      McMillan, Tom (Glasgow, C.)

      Archer, Peter (Rowley Regis)

      Foley, Maurice

      McNamara, J. Kevin

      Ashley, Jack

      Foot, Michael

      Mahon, Simon (Bootle)

      Ashton, Joe

      Ford, Ben

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

      Atkinson, Norman

      Forrester, John

      Marks, Kenneth

      Bagier, Gordon A. T.

      Fraser, John (Norwood)

      Marquand, David

      Barnes, Michael

      Freeson, Reginald

      Marsden, F.

      Barnett, Guy (Greenwich)

      Galpern, Sir Myer

      Marshall, Dr. Edmund

      Barnett, Joel (Heywood and Royton)

      Garrett, W. E.

      Mason, Rt. Hn. Roy

      Beaney, Alan

      Gilbert, Dr. John

      Mayhew, Christopher

      Benn, Rt. Hn. Anthony Wedgwood

      Ginsburg, David (Dewsbury)

      Meacher, Michael

      Bennett, James(Glasgow, Bridgeton)

      Golding, John

      Mellish, Rt. Hn. Robert

      Bidwell, Sydney

      Gourlay, Harry

      Mendelson, John

      Bishop, E. S.

      Grant, George (Morpeth)

      Millan, Bruce

      Blenkinsop, Arthur

      Grant, John D. (Islington, E.)

      Miller, Dr. M. S.

      Boardman, H. (Leigh)

      Griffiths, Eddie (Brightside)

      Milne, Edward

      Booth, Albert

      Griffiths, Will (Exchange)

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

      Bottomley, Rt. Hn. Arthur

      Hamilton, James (Bothwell)

      Molloy, William

      Boyden, James(Bishop Auckland)

      Hamilton, William (Fife, W.)

      Morgan, Elystan (Cardiganshire)

      Bradley, Tom

      Hamling, William

      Morris, Alfred (Wythenshawe)

      Brown, Robert C. (N'c'tle-u-Tyne,W.)

      Hannan, William (G'gow, Maryhill)

      Morris, Charles R. (Openshaw)

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

      Hardy, Peter

      Moyle, Roland

      Brown, Ronald(Shoreditch & F'bury)

      Harrison, Walter (Wakefield)

      Mulley, Rt. Hn. Frederick

      Buchan, Norman

      Hart, Rt. Hn. Judith

      Murray, Ronald King

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

      Hattersley, Roy

      Oakes, Gordon

      Butler, Mrs. Joyce (Wood Green)

      Healey, Rt. Hn. Denis

      Ogden, Eric

      Campbell, I. (Dunbartonshire, W.)

      Heffer, Eric S.

      O'Halloran, Michael

      Cant, R. B.

      Horam, John

      O'Malley, Brian

      Carmichael, Neil

      Houghton, Rt. Hn. Douglas

      Oram, Bert

      Carter, Ray (Birmingham, Northfield)

      Huckfield, Leslie

      Orbach, Maurice

      Castle, Rt. Hn. Barbara

      Hughes, Rt. Hn. Cledwyn (Anglesey)

      Orme, Stanley

      Clark, David (Colne Valley)

      Hughes, Mark (Durham)

      Oswald, Thomas

      Cocks, Michael (Bristol, S.)

      Hughes, Robert (Aberdeen, N.)

      Owen, Dr. David (Plymouth, Sutton)

      Cohen, Stanley

      Hughes, Roy (Newport)

      Padley, Walter

      Coleman, Donald

      Hunter, Adam

      Paget, R. T.

      Concannon, J. D.

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

      Palmer, Arthur

      Conlan, Bernard

      Janner, Greville

      Pannell, Rt. Hn. Charles

      Corbet, Mrs. Freda

      Jay, Rt. Hn. Douglas

      Parker, John (Dagenham)

      Cox, Thomas (Wandsworth, C.)

      Jenkins, Hugh (Putney)

      Parry, Robert (Liverpool, Exchange)

      Cronin, John

      Jenkins, Rt. Hn. Roy (Stechford)

      Peart, Rt. Hn. Fred

      Pendry, Tom

      Prentice, Rt. Hn. Reg.

      Crosland, Rt. Hn. Anthony

      John, Brynmor

      Prescott, John

      Crossman, Rt. Hn. Richard

      Johnson, Carol (Lewisham, S.)

      Price, J. T. (Westhoughton)

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

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

      Price, William (Rugby)

      Cunningham, Dr. J. A. (Whitehaven)

      Johnson, Walter (Darby, S.)

      Probert, Arthur

      Dalyell, Tam

      Jones, Barry (Flint, E.)

      Reed, D. (Sedgefield)

      Darling, Rt. Hn. George

      Jones, Dan (Burnley)

      Rees, Merlyn (Leeds, S.)

      Davidson, Arthur

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

      Rhodes, Geoffrey

      Davies, Denzil (Llanelly)

      Jones, Gwynoro (Carmarthen)

      Richard, Ivor

      Davies, G. Elfed (Rhondda, E.)

      Kaufman, Gerald

      Roberts, Albert (Normanton)

      Davies, Ifor (Gower)

      Kelley, Richard

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

      Davis, Clinton (Hackney, C.)

      Kerr, Russell

      Roberts, Rt.Hn.Goronwy (Caernarvon)

      Davis, Terry (Bromsgrove)

      Kinnock, Neil

      Rodgers, William (Stockton-on-Tees)

      Deakins, Eric

      Lambie, David

      Roper, John

      de Freitas, Rt. Hn. Sir Geoffrey

      Lamborn, Harry

      Rose, Paul B.

      Boss, Rt. Hn. William (Kilmarnock)

      Delargy, Hugh

      Lamond, James

      Rowlands, Ted

      Dell, Rt. Hn. Edmund

      Latham, Arthur

      Sandelson, Neville

      Dempsey, James

      Lawson, George

      Sheldon, Robert (Ashton-under-Lyne)

      Dormand, J. D.

      Leadbitter, Ted

      Shore, Rt. Hn. Peter (Stepney)

      Douglas, Dick (Stirlingshire, E.)

      Lee, Rt. Hn. Frederick

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

      Douglas-Mann, Bruce

      Leonard, Dick

      Silkin, Rt. Hn. John (Deptford)

      Duffy, A. E. P.

      Lestor, Miss Joan

      Silkin, Hn. S. C. (Dulwich)

      Dunn, James A.

      Lewis, Arthur (W. Ham, N.)

      Sillars, James

      Dunnett, Jack

      Lewis, Ron (Carlisle)

      Silverman, Julius

      Eadie, Alex

      Lipton, Marcus

      Skinner, Dennis

      Edelman, Maurice

      Lomas, Kenneth

      Small, William

      Edwards, Robert (Bilston)

      Loughlin, Charles

      Smith, John (Lanarkshire, N.)

      Edwards, William (Merioneth)

      Lyon, Alexander W. (York)

      Spearing, Nigel

      English, Michael

      Lyons, Edward (Bradford, E.)

      Spriggs, Leslie

      Evans, Fred

      Mabon, Dr. J. Dickson

      Stallard, A. W.

      Ewing, Harry

      McBride, Neil

      Stewart, Rt. Hn. Michael (Fulham)

      Faulds, Andrew

      McCartney, Hugh

      Stoddart, David (Swindon)

      Fernyhough, Rt. Hn. E.

      McGuire, Michael

      Strang, Gavin

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

      Mackenzie, Gregor

      Strauss, Rt. Hn. G. R.

      Mackie, John

      Summerskill, Hn. Dr. Shirley

      Fitt, Gerard (Belfast, W.)

      Mackintosh, John P.

      Swain, Thomas

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

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

      Williams, Alan (Swansea, W.)

      Thomas, Jeffrey (Abertillery)

      Walker, Harold (Doncaster)

      Williams, Mrs. Shirley (Hitchin)

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

      Watkins, David

      Williams, W. T. (Warrington)

      Tinn, James

      Weitzman, David

      Wilson, William (Coventry, S.)

      Tomney, Frank

      Wellbeloved, James

      Woof, Robert

      Torney, Tom

      Wells, William (Walsall, N.)

      Tuck, Raphael

      White, James (Glasgow, Pollok)

      TELLERS FOR THE AYES:

      Urwin, T. W.

      Whitehead, Phillip

      Mr. Joseph Harper and

      Varley, Eric G.

      Whitlock, William

      Mr. Ernest G. Perry.

      Wainwright, Edwin

      Willey, Rt. Hn. Frederick

      NOES

      Adley, Robert

      du Cann, Rt. Hn. Edward

      Jessel, Toby

      Alison, Michael (Barkston Ash)

      Dykes, Hugh

      Johnson Smith, G. (E. Grinstead)

      Allason, James (Hemel Hempstead)

      Eden, Rt. Hn. Sir John

      Jones, Arthur (Northants, S.)

      Amery, Rt. Hn. Julian

      Edwards, Nicholas (Pembroke)

      Jopling, Michael

      Archer, Jeffrey (Louth)

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

      Joseph, Rt. Hn. Sir Keith

      Astor, John

      Emery, Peter

      Kellett-Bowman, Mrs. Elaine

      Atkins, Humphrey

      Eyre, Reginald

      Kershaw, Anthony

      Awdry, Daniel

      Farr, John

      Kilfedder, James

      Baker, Kenneth (St. Marylebone)

      Fell, Anthony

      Kimball, Marcus

      Baker, W. H. K. (Banff)

      Fenner, Mrs. Peggy

      King, Evelyn (Dorset, S.)

      Balniel, Rt. Hn. Lord

      Fidler, Michael

      King, Tom (Bridgewater)

      Barber, Rt. Hn. Anthony

      Finsberg, Geoffrey (Hampstead)

      Kinsey, J. R.

      Batsford, Brian

      Fletcher-Cooke, Charles

      Kirk, Peter

      Beamish, Col. Sir Tufton

      Fookes, Miss Janet

      Knight, Mrs. Jill

      Bell, Ronald

      Fortescue, Tim

      Knox, David

      Bennett, Sir Frederic (Torquay)

      Foster, Sir John

      Lambton, Lord

      Benyon, W.

      Fowler, Norman

      Lamont, Norman

      Bitten, John

      Fry, Peter

      Lane, David

      Biggs-Davison, John

      Galbraith, Hn. T. G. D.

      Langford-Holt, Sir John

      Blaker, Peter

      Gardner, Edward

      Le Marchant, Spencer

      Boardman, Tom (Leicester, S.W.)

      Gibson-Watt, David

      Lewis, Kenneth (Rutland)

      Body, Richard

      Gilmour, Sir John (Fife, E.)

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

      Boscawen, Hn. Robert

      Glyn, Dr. Alan

      Loveridge, John

      Bossom, Sir Clive

      Godber, Rt. Hn. J. B.

      Luce, R. N.

      Bowden, Andrew

      Goodhart, Philip

      MacArthur, Ian

      Braine, Sir Bernard

      Goodhew, Victor

      McCrindle, R. A.

      Bray, Ronald

      Gorst, John

      McLaren, Martin

      Brinton, Sir Tatton

      Gower, Raymond

      Maclean, Sir Fitzroy

      Brocklebank-Fowler, Christopher

      Grant, Anthony (Harrow, C.)

      McMaster, Stanley

      Brown, Sir Edward (Bath)

      Gray, Hamish

      Macmillan, Rt. Hn. Maurice (Farnham)

      Bryan, Sir Paul

      Green, Alan

      McNair-Wilson, Michael

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

      Grieve, Percy

      McNair-Wilson, Patrick (New Forest)

      Buck, Antony

      Griffiths, Eldon (Bury St. Edmunds)

      Maddan, Martin

      Bullus, Sir Eric

      Grimond, Rt. Hn. J.

      Madel, David

      Burden, F. A.

      Grylls, Michael

      Marples, Rt. Hn. Ernest

      Butler, Adam (Bosworth)

      Gummer, J. Selwyn

      Marten, Neil

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

      Gurden, Harold

      Mather, Carol

      Carlisle, Mark

      Hall, Miss Joan (Keighley)

      Maude, Angus

      Carr, Rt. Hn. Robert

      Hall, John (Wycombe)

      Mawby, Ray

      Cary, Sir Robert

      Hall-Davis, A. G. F.

      Maxwell-Hyslop, R. J.

      Channon, Paul

      Hamilton, Michael (Salisbury)

      Mills, Stratton (Belfast, N.)

      Chapman, Sydney

      Hannam, John (Exeter)

      Miscampbell, Norman

      Harrison, Brian (Maldon)

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

      Chataway, Rt. Hn. Christopher

      Harrison, Col. Sir Harwood (Eye)

      Mitchell, David (Basingstoke)

      Chichester-Clark, R.

      Haselhurst, Alan

      Moate, Roger

      Churchill, W. S.

      Hastings, Stephen

      Molyneux, James

      Clark, William (Surrey, E.)

      Money, Ernie

      Clarke, Kenneth (Rushcliffe)

      Havers, Michael

      Monks, Mrs. Connie

      Clegg, Walter

      Hayhoe, Barney

      Monro, Hector

      Cockeram, Eric

      Heseltine, Michael

      Montgomery, Fergus

      Cooke, Robert

      Hicks, Robert

      More, Jasper

      Coombs, Derek

      Higgins, Terence L.

      Morgan, Geraint (Denbigh)

      Cooper, A. E.

      Hiley, Joseph

      Morgan-Giles, Rear-Adm.

      Cordle, John

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

      Morrison, Charles

      Corfield, Rt. Hn. Sir Frederick

      Mudd, David

      Cormack, Patrick

      Hill, James (Southampton, Test)

      Murton, Oscar

      Costain, A. P.

      Holland, Philip

      Neave, Airey

      Holt, Miss Mary

      Noble, Rt. Hn. Michael

      Critchley, Julian

      Hordern, Peter

      Nott, John

      Crouch, David

      Hornby, Richard

      Onslow, Cranley

      Crowder, F. P.

      Hornsby-Smith, Rt.Hn.Dame Patricia

      Oppenheim, Mrs. Sally

      Howe, Hn. Sir Geoffrey (Reigate)

      Orr, Capt. L. P. S.

      Davies, Rt. Hn. John (Knutsford)

      Osborn, John

      d'Avigdor-Goldsmid, Sir Henry

      Howell, Ralph (Norfolk, N.)

      Owen, Idris (Stockport, N.)

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

      Hunt, John

      Page, Rt. Hn. Graham (Crosby)

      Dean, Paul

      Hutchison, Michael Clark

      Page, John (Harrow, W.)

      Deedes, Rt. Hn. W. F.

      Iremonger, T. L.

      Pardoe, John

      Digby, Simon Wingfield

      Irvine, Bryant Godman (Rye)

      Parkinson, Cecil

      Dixon, Piers

      James, David

      Peel, John

      Dodds-Parker, Douglas

      Jenkin, Patrick (Woodford)

      Percival, Ian

      Drayson, G. B.

      Jennings, J. C. (Burton)

      Pike, Miss Mervyn

      764

      765

      Pink, R. Bonner

      Simeons, Charles

      Trew, Peter

      Pounder, Ration

      Sinclair, Sir George

      Tugendhat, Christopher

      Price, David (Eastleigh)

      Skeet, T. H. H.

      Turton, Rt. Hn. Sir Robin

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

      Smith, Cyril (Rochdale)

      van Straubenzee, W. R.

      Proudfoot, Wilfred

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

      Vaughan, Dr. Gerard

      Pym, Rt. Hn. Francis

      Soref, Harold

      Vickers, Dame Joan

      Raison, Timothy

      Speed, Keith

      Walder, David (Clitheroe)

      Ramsden, Rt. Hn. James

      Spence, John

      Walker-Smith, Rt. Hn. Sir Derek

      Rawlinson, Rt. Hn. Sir Peter

      Sproat, lain

      Wall, Patrick

      Redmond, Robert

      Stainton, Keith

      Walters, Dennis

      Reed, Laurance (Bolton, E.)

      Stanbrook, Ivor

      Ward, Dame Irene

      Rees, Peter (Dover)

      Steel, David

      Warren, Kenneth

      Rees-Davies, W. R.

      Stewart-Smith, Geoffrey (Belper)

      Weatherill, Bernard

      Renton, Rt. Hn. Sir David

      Stodart, Anthony (Edinburgh, W.)

      Wells, John (Maidstone)

      Rhys Williams, Sir Brandon

      Stoddart-Scott, Col. Sir M.

      White, Roger (Gravesend)

      Ridley, Hn. Nicholas

      Stokes, John

      Wiggin, Jerry

      Ridsdale, Julian

      Stuttaford, Dr. Tom

      Wilkinson, John

      Rippon, Rt. Hn. Geoffrey

      Sutcliffe, John

      Winterton, Nicholas

      Roberts, Michael (Cardiff, N.)

      Tapsell, Peter

      Wolrige-Gordon, Patrick

      Roberts, Wyn (Conway)

      Taylor, Sir Charles (Eastbourne)

      Wood, Rt. Hn. Richard

      Rodgers, Sir John (Sevenoaks)

      Taylor, Frank (Moss Side)

      Woodhouse, Hn. Christopher

      Rossi, Hugh (Hornsey)

      Taylor, Robert (Croydon, N.W.)

      Woodnutt, Mark

      Rost, Peter

      Tebbit, Norman

      Worsley, Marcus

      Russell, Sir Ronald

      Temple, John M.

      Wylie, Rt. Hn. N. R.

      St. John-Stevas, Norman

      Thatcher, Rt. Hn. Mrs. Margaret

      Younger, Hn. George

      Scott, Nicholas

      Thomas, John Stradling (Monmouth)

      Scott-Hopkins, James

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

      TELLERS FOR THE NOES:

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

      Thompson, Sir Richard (Croydon, S.)

      Mr. Paul Hawkins and

      Shelton, William (Clapham)

      Tilney, John

      Mr. Marcus Fox.

      Question accordingly negatived.
      Clause 5 ordered to stand part of the Bill.
      Clauses 6 to 10 ordered to stand part of the Bill.
      Schedule agreed to.
      It being Eleven o'clock, The CHAIRMAN, pursuant to Order [14th November], left the Chair to report the Bill, without Amendment, to the House.
      Bill reported, without Amendment; to be read the Third time tomorrow.

  ADJOURNMENT
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Kenneth Clarke.]

THALIDOMIDE CHILDREN
11.0 p.m.
Mr. Jack Ashley: My purpose in this debate on thalidomide children is to criticise the treatment they have received, to offer constructive proposals and to demand immediate action. I have no wish to make party political points in the debate, and I do not believe that anyone else wishes to do so either, but that does not absolve the Government from criticism, particularly of certain statements by the Prime Minister.
I welcome the attempt by my right hon. Friend the Leader of the Opposition to
766
secure a general debate so that Members may express their views. I am unable to comment on the legal matters, which may be sub judice, but the House will want the facts and answers to certain questions.
Some 430 children—deformed, some without legs and some without arms, some without either, some who are deaf, some who are blind, some who are mentally defective and some who have internal abnormalities—are affected. All of them are the casualties of thalidomide, suffering injuries as appalling as those of any soldier on the battlefield, and all of them are innocent children.
Why were they injured? It was because their mothers believed the categorical and clear statement by Distillers that:
"Distavel"
that is thalidomide—
"can be given with complete safety, without adverse effect on mother or child."
That statement, in the form of an advertisement, was made only weeks before thalidomide was withdrawn. The House will draw its own conclusions about moral responsibility.
The House should carefully scrutinise the tragic scene and study the principals involved. First, the Distillers Company: why did it make such a strong, unqualified claim about thalidomide? Did it test thalidomide on the foetus of animals? Those are two crucial questions to which the House has a right to demand the answers.

767
There is no point in any company's trying to gag Parliament. Distillers has tried to gag the Press. It has tried to suppress television. But the truth must be ventilated, and that is one of the purposes of our parliamentary campaign.
What rôle have the Government played? What steps did they take to check the veracity of the claim by Distillers in the statement that I have quoted? Did the Government know that the United States Government were demanding evidence of thalidomide's safety at that time? Did the Government ask the Cohen Committee to demand such evidence? If not, why not?
Are the Government satisfied that they did all in their power to prevent this tragedy?
The House must ask, what is the extent of Government responsibility? On 24th October, from the Dispatch Box, the Prime Minister rejected my claim that the Government must share responsibility. It was a categorical rejection. A few hours ago, however, I was given some surprising information, namely, that drugs and medicines are chargeable for purchase tax but that some exemptions are allowed, on grounds of exceptional efficacy, by Customs and Excise and its advisers, the Department of Health and Social Security. That information was passed to my right hon. Friend the Member for Blackburn (Mrs. Castle), who kindly passed it on to me.
What I find astonishing—I do not know what the Minister's view of this will be—is that thalidomide was granted exemption from purchase tax by the Government under the Purchase Tax (No. 3) Order, 1958. I have given the Minister notice of this point. I would greatly appreciate a reply. Can the Minister confirm this fact? I should be glad if he could deny it, but if he confirms it this raises deeply disturbing questions.
Can the Minister also confirm that exemption is highly prized by the drug manufacturers, in so far as it enables them to sell a drug under a brand name and confers a semi-official blessing as to its efficacy and safety, whereas without exemption the drug would probably not be bought for the National Health Service?
768
The Government are more deeply involved in the tragedy of thalidomide than anyone ever dreamed. Even if the Minister can deny all these allegations—I genuinely hope that he can—the fact remains that the Government distributed thalidomide under the National Health Service. Because of that, they have a clear responsibility. I am not in any way attempting to mitigate the major moral responsibility of the Distillers Company.
A precedent has been established abroad for setting up a fund for thalidomide children. I find it dismaying that it is not only established but the money is being distributed while our Prime Minister is saying that he is considering whether to create such a fund and is waiting for the negotiations to be concluded. Supposing that the negotiations take another 10 years—as well they may—or another 20 years, what happens to the children and the families in the meantime? Is the Prime Minister seriously suggesting that we must await the pleasure of the Distillers Company and its legal advisers before taking action?
The Prime Minister's sympathy and sincerity are quite unquestioned, but he must think again. He must change his mind and establish that fund immediately. He could establish such a fund without prejudice to the negotiations between the Distillers Company and the parents because the two matters would be entirely separate.
If the Prime Minister is in any doubt, I now suggest a method which has the virtue of simplicity. The Government should establish a fund covering all the financial needs of the children based on actuarial considerations and taking account of inflation. An essential condition of the fund would be that the parents should undertake to return to the Government whatever money was negotiated in a settlement with the Distillers Company. Thus, for example, if the Government established a fund of £20 million and if the settlement between the parents and the Distillers Company were £15 million, the children would benefit from the £20 million and the extra £15 million would be returned to the Government. If the Government felt that the settlement arrived at was inadequate, they could instruct their legal advisers to cooperate with those of the parents to try to ensure a morally just settlement. Thus,

769
the public interest as well as the private interests would be served.
I look forward to hearing a contribution by the hon. Member for Newbury (Mr. Astor), if he catches your eye, Mr. Deputy Speaker.
The primary aim of this campaign and debate is to help thalidomide children, who are a special case. I see them as a symbol of all disabled children. I hope that from their tragedy will emerge a will and a way of creating a new era for disabled children everywhere.
11.10 p.m.
Mr. John Astor: I congratulate the hon. Member for Stoke-on-Trent, South (Mr. Ashley) on focusing attention on the plight of thalidomide children. As he said in his introductory remarks, this is not a party political issue; it is a concern shared by hon. Members on both sides of the House. We are genuinely anxious to do the best we can not only for this group of children but for disabled people generally.
I do not propose to comment on the discussions taking place at present between Distillers Biochemicals, Ltd., and the parents, except that one naturally hopes that a fair and honourable settlement will be reached very speedily, because the negotiations have already been long drawn out. Whatever the outcome of the settlement and the terms of compensation, it seems unlikely that the fund provided will be sufficient to meet all the needs of the children over the years to come. Indeed, many of these needs cannot at present be foreseen.
Many national tragedies have a rather short-term impact, but the effects of the thalidomide tragedy are long-term and will be a burden to the children and their families throughout their lives. Indeed, they are already emerging from childhood to adulthood.
I am sure that all hon. Members would like to ensure that the best possible opportunities are given to these children in education, training, employment and, indeed, in their everyday living activities. A great deal of support will be required. Much of it will be very expensive. We cannot envisage exactly what their needs will be and what available technological equipment will be required. However, we know that it will be costly and that
770
the need is likely to continue for many years.
I support the hon. Gentleman in urging the Government to consider setting up a national fund at the earliest opportunity.
Mr. Lewis Carter-Jones: Does the hon. Gentleman, who is a great friend of mine in this sense, agree that we should give the maximum technical support to assist these people to get on their feet and enable them to be independent?
Mr. Astor: Yes, indeed. I agree wholeheartedly with the hon. Gentleman. I know the work that he does in this connection. I think that we often work together in emphasising the need to enable disabled people to take advantage of the technical equipment now available so that they may lead fuller and more independent lives.
I agree with the hon. Member for Stoke-on-Trent, South that the Government should consider setting up a national fund for these children and their families. However, I do not think that his strictures on my right hon. Friend the Prime Minister were justified or fair. My right hon. Friend explained that he was very willing to consider the setting up of such a fund, but that the Government could not put themselves in a position which might prejudice the litigation now going through the courts.
In the meantime, I ask the Government to consider the possibility of meeting the emergency and filling the gap by giving financial support to one of the charities, such as the Lady Hoare Trust, which has done valiant work in helping to support these children and their families during these difficult years. I think that all hon. Members on both sides of the House would be resentful if, for lack of financial resources, these children were deprived of any facilities which could be of benefit to them. Therefore, I hope that the Government will consider that point.
11.15 p.m.
The Under-Secretary of State for Health and Social Security (Mr. Paul Dean): The thalidomide children have touched the hearts of the people of this country and the people of many other countries. They have produced a practical response from statutory and voluntary

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bodies alike. I am sure that the whole House would wish to pay tribute to the courage and devotion of parents, the skill and ingenuity of doctors, nurses, social workers, limb fitters, engineers, voluntary organisations and particularly the Lady Hoare Trust, which has done so much to support the Chailey Heritage on the South Coast; and also to the determination and adaptability of the children concerned. All this has been a triumph of the human spirit over disability and is a shining example to us all.
I am sure the House will also wish to bear in mind that this is part of a wider problem. Alas, there are many other disabled children in our country with similar needs—children disabled in road accidents, fires in the home, and batterings from their parents, and children who have suffered deformities of all sorts and kinds. Indeed, 20,000 children are now receiving the attendance allowance which the Government introduced in December, 1971. It may be that there will be a further 30,000 who will get the allowance under the extension which will be starting fairly soon. This is part of a much wider problem involving a large number of children.
The whole House is grateful to the hon. Member for Stoke-on-Trent, South (Mr. Ashley), for the points which he raised in his speech, and I am particularly grateful to him for giving me notice of them. All hon. Members have a high regard for the hon. Gentleman personally. [HON. MEMBERS: "Hear, hear."] He has triumphed over his own disability.
I am glad that the hon. Gentleman emphasised that this is not a party political matter. Anybody who tried to make a political football out of the tragedy of these children would be carrying a heavy load of responsibility. However, I am sorry that he felt it necessary to criticise my right hon. Friend the Prime Minister. On numerous occasions my right hon. Friend has demonstrated his personal concern for the disabled. He has personally seen the Disabled Drivers Association; he is shortly to have another meeting with the Disablement Income Group; and in the House only last Tuesday he offered, as did my right hon. Friend the Secretary of State for Social Services, personally to investigate any
772
case of real need or any case involving requirements of any kind which are not being adequately met.
The hon. Gentleman pressed his case for the setting up of a special fund and my hon. Friend the Member for Newbury (Mr. Astor) made a similar point in his short speech.
Mr. Ashley: May I make quite clear that my attacks on the Prime Minister are in no way personal? All my attacks on the Prime Minister relate to his policies. I ask the House to accept that as a fact, since I want there to be no ambiguity about the situation. I propose to continue my attack, but there is nothing personal in it against the Prime Minister, nor is there any party political matter involved.
Mr. Dean: I am obliged to the hon. Gentleman. I fully accept what he said. Indeed, he said it in his speech, and I acknowledge it. However, I felt that he was rather unfair to my right hon. Friend, who has shown deep personal concern in regard not only to this aspect of disablement but to other disabled sections of the community.
As for a special fund, I am sure the hon. Gentleman appreciates that on such an occasion as this I cannot add to what the Prime Minister said in the House on Tuesday. He then said that he would agree to consider carefully the setting up of a special fund or the question of the support of existing funds. He continued:
"I was asked to consider the possibility of setting up a foundation to provide financial resources. But it was a foundation to bridge any gap between the result of any legal arrangement and what it was felt these children needed. Therefore it is right that we should await the outcome of legal arrangements before coming to a firm conclusion about the needs of these children which still require to be met."—[OFFICIAL REPORT, 14th November, 1972; Vol. 846, c. 212.]
There is also the point about the Robens Committee on Safety and Health at Work, which made certain recommendations. Here again, my right hon. Friend has given a firm commitment that these matters are being examined urgently by the Government—
Mr. Alfred Morris: In this connection, my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) has said that the central Government are deeply involved in the tragedy of the thalidomide

773
children. Is there any responsibility on the central Government for permitting thalidomide to be prescribed under the National Health Service?
Mr. Dean: I am coming to that very point. The hon. Member for Stoke-on-Trent, South raised this matter and asked me about the position.
Traditionally, before the legislation to which I shall refer in a moment, new drugs were always marketed on the responsibility of the manufacturer. This happened under Governments of both parties. Doctors exercised their clinical judgment in deciding to use them to treat patients and reported in professional journals their experience of them in use. In this way a climate of professional opinion about the value and risks of a drug was built up. At that time there were no powers under which the Government or Government agencies could check thalidomide or any other drug before it was marketed.
The then Government saw that there were gaps in the law, and they responded. In 1963 the Committee on Safety of Drugs was appointed. In 1968 the Medicines Act was passed, which set up a licensing system concerned with the safety and efficacy of drugs. The Act also made it an offence for therapeutic recommendations in advertisements not to be in accordance with those specified in the product licence. In other words, the points mentioned by the hon. Gentleman which were not covered before this case came to light are now covered in existing law.
The hon. Gentleman also pointed out that thalidomide was exempted from purchase tax in 1958. I can only emphasise that at that time no one knew that it was a dangerous drug. On the contrary, it was in respectable use by the medical profession and as such was recommended by the Ministry of Health for exemption from purchase tax. This was—and still is—a normal procedure. It did not imply any special commendation.
I turn to the matters mentioned by my hon. Friend the Member for Newbury. First, he asked what is now being done to help these children. There is a wide range of services for the medical, educational and welfare needs of both the children and their families. Taking cash benefits. I have mentioned the attendance
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allowance and the extension of the allowance, and all the other allowances in the various schemes. For example, family allowances and family income supplement are available to these families in the same way as they are to other families. There is support for the families themselves through local health and welfare services—
Mr. Carter-Jones Mr. Carter-Jones rose—
Mr. Dean: No. I cannot give way to the hon. Gentleman. I have a great deal to say—
Mr. Nigel Spearing: We know all this.
Mr. Dean: These include guidance by social workers and health visitors and practical help, for example, with laundry, nursing and home helps.
Then there is employment. When the time comes, vocational training will be available for these children. There will be special aids and facilities for them in sheltered workshops, where these are appropriate.
As for education, many of these children are being educated at ordinary schools at the specific request of their parents. But where necessary there are—
Mr. Carter-Jones: Will the hon. Gentleman give way?
Mr. Dean: I am sorry. I have a great deal of information to give the House. The hon. Gentleman has intervened once already. I hope that he will forgive me if I do not give way to him.
Mr. Spearing: But this is not information.
Mr. Dean: Special equipment is also available, such as typewriters and tape recorders, for these children—
Mr. Carter-Jones: Paid for out of private funds.
Mr. Dean: No, the hon. Member is incorrect. I am talking about services which are provided, often in co-operation with voluntary bodies, but the substantial proportion of which are provided by public funds.
Mr. Carter-Jones: In Belfast this is provided by mainly private funds.
Mr. Dean: Perhaps most impressive of all is the limb-fitting work which is being done. We can claim that some of our equipment is the most advanced in the world. There has been a close personal relationship built up between all these children and the doctors and the limb-fitters. They know these children by name and this contact is on a regular basis. There is a concern not only with the physical needs of the children but with the psychological and social needs of them and their families.
Let me give some examples. The artificial arms which enable a number of these children to feed themselves, write and play, the artificial legs—
Dr. Tom Stuttaford Dr. Tom Stuttaford (Norwich, South) rose—
Mr. Dean: I will give way in a moment. In many cases these limbs are tailor-made to suit unusual and varied deformities. There are aids to mobility. For example, we have developed one, with departmental support, which is unique and which enables children with artificial legs to make their own way to a platform at floor level, raise it electrically and then to travel about standing, as in a powered wheelchair. I mention this to show what has been done under all Governments during the last 10 years to assist these children to live as normal a life as possible.
Dr. Stuttaford: What the House really wants to know is how the thalidomide children, for whom any Government must bear some responsibility—
Mr. Spearing: Hear, hear.
Dr. Stuttaford: —together with the subagents who distributed the drug, are being treated differently from the other children. It seems that we have had an account of the way in which all crippled children are being treated. We would like to learn whether these children are to have a cash benefit, which they will need to compensate them for their deficiencies, for which we are all responsible.
Mr. Dean: My hon. Friend will find, when he has an opportunity of reading HANSARD, that I have referred to a number of services provided specifically to
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help with the problems of these children. I have demonstrated the Government's deep concern for these children; I have illustrated the wide range of services available and the matters being considered; and I have mentioned the practical offer to investigate any case of real need which is not being met.
11.28 p.m.
Mr. Alfred Morris: We have heard an extremely unsatisfactory answer to the compelling case made by my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley). I must emphasise immediately that there is no question whatever of party politics in this. My hon. Friend has been studiedly careful to avoid any reference to parties. There are two Motions on the Order Paper. One is official and one is from the back benches. We would like the Government to face up to their responsibilities. They having permitted the prescription of thalidomide under the National Health Service, there is clearly a duty on central Government to face their responsibilities.
We argue that the Distillers Company must face its responsibilities. It is well within its means to meet all the needs of the thalidomide children in the country. We say that it is the merest justice that it should discharge those responsibilities. We argue—and I believe that we do so on behalf of all hon. and right hon. Members—that there must be an urgent and detailed debate on all the implications of this tragedy. I ask the hon. Gentleman and the Secretary of State to look again at the proposition of my hon. Friend. He is not a person who would seek to introduce party politics into an issue of this kind. There is an all-party Disablement Group. The hon. Member for Newbury (Mr. Astor), the hon. Member for Eccles (Mr. Carter-Jones), as well as my hon. Friend, are trying to protect the interests of disabled people—
The Question having been proposed after Ten o'clock, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at half-past Eleven o'clock.

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Preamble
The House met at three of the clock: THE LORD CHANCELLOR On the Woolsack.
Prayers—Read by the Lord Bishop of Portsmouth.

MESSAGE FROM THE QUEEN
LORD MACLEAN: My Lords, I have the honour to present to your Lordships a Message from Her Majesty the Queen, signed by her own hand. The Message is as follows:
"I have received with great satisfaction the loyal and dutiful expression of your thanks for the Speech with which I opened the present Session of Parliament."

SILVER WEDDING OF THE QUEEN AND THE DUKE OF EDINBURGH
3.7 p.m.
THE LORD PRIVY SEAL (EARL JELLICOE)THE LORD PRIVY SEAL (EARL JELLICOE) rose to move, That an humble Address be presented to Her Majesty The Queen to congratulate Her Majesty and His Royal Highness the Duke of Edinburgh on the occasion of the twenty-fifth Anniversary of their Wedding, to express the deep gratitude of this House for their contribution to the affairs of the nation and for their unfailing example in public and family life, and to convey every good wish for their continued happiness. The noble Earl said: My Lords, it is with humble duty—to use the old and happily still valid phrase—that I have the honour to move the Motion standing in my name. Both Houses of Parliament presented Addresses on the occasion of the Silver Wedding of Her Majesty's Grandparents, and indeed of Her Father and Mother, the late and greatly loved King George VI and Queen Elizabeth, now our greatly loved Queen Mother. She must derive a very particular pleasure from this happy occasion which we shall be celebrating shortly.
Six months before the Silver Wedding of King George VI and Queen Elizabeth this House submitted an humble Address
808
of congratulation on "the approaching marriage of Her Royal Highness, to Lieutenant Philip Mountbatten", and in that Address we expressed the satisfaction of this House on an event which promised "to secure the happiness of Her Royal Highness". I think we all felt that when the time came for her to Succeed (and we did not know then how soon that time would be) it was right that Her Royal Highness should not be asked to withstand alone "the fierce light that beats upon the Throne". My Lords, that marriage which we now commemorate has indeed secured the happiness which we then hoped for. Moreover, it has been a happiness not only for Her Majesty, His Royal Highness and their family, but also, by extension, for this country as a whole, for the Commonwealth and for many other countries outside our immediate family circle of nations.
A Silver Wedding is above all a family occasion, and it is fitting that this Silver Wedding is one which is being celebrated in a particularly close and united family. It is my belief that the family life of our Sovereign constitutes one of the main bonds which has strengthened what my noble friend Lord Blake described in moving the humble Address as,
"the free, friendly…yet basically kind social order which prevails in Britain."
My Lords, it is almost a truism to-day to say that we live in an era of rapid, almost revolutionary, change. And it would seem almost a paradox that in these circumstances the Monarchy should, as I would opine, have never been more secure than it is to-day. The explanation for this seeming paradox is of course easy to find. It lies in the shining example which the Royal Family have given of family unity and, above all, of dedicated service to our fellow countrymen. This service is manifest in all areas of our national life, from the proudest State occasion to the most informal and humdrum sporting event. Indeed, my Lords, there are few nooks and crannies of our national life which our Royal Family have not explored.
As we know from the gracious Speech, Her Majesty and His Royal Highness are to visit Canada and Australia in their Silver Wedding year. They will not be going abroad, since they will be on home territory. The same love and respect

809
which we feel in this country for Her Majesty and His Royal Highness are also felt by the Queen's subjects across the Atlantic and in the wide Pacific. All this the world well knows. But fewer, perhaps, know well the extraordinary impact of Her Majesty in representing the United Kingdom to countries other than the Commonwealth, whether on a visit, as recently to Yugoslavia, or as host in this country to the President of Italy last year or to the President of Germany only a few weeks ago. We are lucky to have in the Queen and in Prince Philip ambassadors for our nation of quite exceptional quality.
We can also, I believe, count ourselves fortunate as a nation that the succession is so firmly secured in the hearts of our people in the persons of the Prince of Wales, Princess Anne and the two younger Princes. It is clear that the Prince of Wales—and I know that your Lordships are gratified at his attendance from time to time in your Lordships' House—possesses his father's capacity for direct, penetrating and witty commentaries on the contemporary scene. It is also clear that both the Prince of Wales and Princess Anne feel a deep involvement over a wide spectrum of our national affairs. Not the least perhaps of the great services which the Royal Family renders to the nation is that it helps to bridge the generation gap in our country.
My Lords, I am sure that I am echoing the wish of all your Lordships when, in conclusion, I express the hope that in another 25 years a future Leader of your Lordships' House will have the honour of moving a further Address to Her Majesty and Prince Philip on their Golden Wedding.
When the then Lord Chancellor, Lord Jowitt, moved the Address at the time of the forthcoming marriage, he concluded by saying:
"In view of the very special and intimate nature of this Resolution, I would suggest to your Lordships that, departing from our usual precedent, it would be fitting that the Resolution should be presented…by the Leaders of the various Parties…and…the Archbishop of Canterbury."—[OFFICIAL REPORT, 22/10/47; col. 84.]
This precedent was followed for the Silver Wedding Address six months later, and I hope I have your Lordships' agreement
810
that we should follow that good example on this occasion. My Lords, I beg to move.
Moved, That an humble Address be presented to Her Majesty The Queen to congratulate Her Majesty and His Royal Highness the Duke of Edinburgh on the occasion of the twenty-fifth Anniversary of their Wedding, to express the deep gratitude of this House for their contribution to the affairs of the nation and for their unfailing example in public and family life, and to convey every good wish for their continued happiness.—(Earl Jellicoe.)
3.13 p.m.
LORD SHACKLETON: My Lords, in rising to support the Motion moved by the noble Earl, I can say little in addition to what he has said in relation to the feelings of every Member of your Lordships' House; and when I echo his phrase "it is with humble duty" that I support this Motion, I would add that it is not only with humble duty but with the greatest satisfaction, a satisfaction which is shared throughout the House.
I would remind your Lordships of the terms of the Motion, which not only congratulates Her Majesty and His Royal Highness on the occasion of the twenty-fifth Anniversary of their Wedding but expresses also the deep gratitude of this House for their contribution to the affairs of the nation and their unfailing example in public and family life. It is a fact of which we need to remind ourselves that we have been uniquely fortunate in our Royal Family. It is a remarkable thing that in this fairly restless age there is probably less criticism of the institution of Royalty and of the present holders than there has been at any time in our history. If one compares some of the criticism, particularly in the last century, with the absence of any real criticism and the acceptance and admiration which is felt by nearly every citizen in the land, that is a measure of their achievement.
The reason for this is not only the modesty with which they approach their task, their willingness always both to uphold their position and to behave like ordinary people in their dealings with ordinary people, but the fact that we know they work tremendously hard and are motivated all the time by this sense

811
of public duty. A friend of mine, seeing the Queen the other day on a television programme, made a remark which I believe describes her contribution very accurately. He said, "She is a great public servant". Mixed no doubt with the interest and happiness of their family life, often spent under very pleasant conditions, must be what I can only consider is the incredible tedium of many of the duties which they so manfully bear, smiling and making everybody happy. The work that we put upon the Royal Family is remarkably onerous and their willingness to meet those obligations calls forth our deep gratitude. It is unquestionably a happy Family, and the House appreciated the noble Earl's reference to the presence of the Prince of Wales. Not the least of the achievements of Her Majesty and the Duke of Edinburgh is to have produced such extraordinarily nice and intelligent children. It must always be a great anxiety to bring up the Heir to the Throne and not all Monarchs have been so successful in it; but here an additional ground for congratulation is that in the Prince of Wales and the rest of the Family we have such delightful and, I may say, intelligent young people.
My Lords, the noble Earl, very properly, referred to the service of the Royal Family to the Commonwealth. It is worth recalling that the Queen first heard the news of her Accession while she was in a Commonwealth country, in Kenya, when she had to assume these onerous and demanding duties. I am happy to say that for the most part in the flood of memoirs of conversations there has been little about the relations between Prime Ministers and Her Majesty and between Ministers and Her Majesty, and it is worth recording that those of us who have had the privilege of serving as Ministers of the Crown have always been met not only with great courtesy and kindness but with interested sympathy which I am convinced is as genuine as everything else that Her Majesty and His Royal Highness do. Therefore it is with a degree of satisfaction which has not been surpassed in our history, and as a really genuine expression of opinion, that I now so gladly support the Motion moved by the noble Earl.
3.19 p.m.
LORD BYERS: My Lords, I also wish, with humble duty and great sincerity, to support on behalf of my noble friends on the Liberal Benches the Motion which has been so ably proposed by the noble Earl, the Leader of the House. As he said, a Silver Wedding is indeed a family affair and an important milestone in a marriage. I am glad to say that my wife and I celebrated our own Silver Wedding shortly after I joined the House eight years ago, and in common with many other families of our generation we have had the great pleasure of watching the growing up and maturing of the young members of the Royal Family, particularly His Royal Highness Prince Charles and Princess Anne.
There is no doubt that the way in which the Monarchy in its totality has adapted itself to the very rapidly changing circumstances of the last quarter of a century while maintaining standards of a very high order has given a confidence and reassurance which has contributed a great deal to our social stability. Her Majesty, Prince Philip and the whole family have shown over these none too easy years a sense of dedication and duty which it is almost impossible to praise too highly. I think we are very fortunate indeed to have this family at the head of our nation. They are not just "Royals"; they are very human, sympathetic people. Moreover, they are blessed with a resilient sense of humour without which I doubt whether they could carry out the multiplicity of duties which they have to perform. For these attributes it is right that the nation should salute them and give thanks on this great occasion. I beg to support the Motion.
3.21 p.m.
THE LORD BISHOP OF LONDON: My Lords, it is my privilege on behalf of the Lords Spiritual to support the Motion so happily moved by the noble Earl. We who sit on these Benches know at first hand, as we go about our dioceses, not only the affection which there is in countless homes for Her Majesty and for Prince Philip but also the immense influence of the example of their happy family life. It is sometimes asserted that a happy marriage has no news value. Whether that is true as a generalisation may be doubted, but it is most definitely not true of the

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life of Her Majesty and His Royal Highness. Their example gives encouragement and inspiration to innumerable families throughout the land. For this we thank God, as we also thank God for the example of ceaseless devotion to public duty which they give and for the way in which they care not only for causes but also for people. A family, as we have been reminded, is not just parents but parents and children, and our gratitude to Her Majesty and to the Duke of Edinburgh is joined with our gratitude for the example of the Royal Family as a whole: for the fine public service already being given by their Royal Highnesses the Prince of Wales and the Princess Anne, and for the obvious family affection which they all have for each other, so happily symbolised in the photographs in the Press last week of the Prince of Wales romping with his younger brothers.
A Silver Wedding, as has been said, is essentially an occasion to be celebrated within the circle of the family, and we are therefore grateful that Her Majesty and his Royal Highness are willing to share their private happiness with the nation on this occasion. We shall support them at the service in the Abbey with our prayers for their continued happiness. We shall show our gratitude with acclamation in Guildhall and elsewhere. But more: I believe, my Lords, behind this humble Address all of us, as individuals, with our humble duty thank them for what they do, for the example which they set the nation; and above all else we thank God for what they are. I beg to support the Motion.
On Question, Motion agreed to, nemine dissentiente.
Ordered, That the said Address be presented to Her Majesty by the Lord Archbishop of Canterbury, the Lord Chancellor, the Lord Privy Seal (Earl Jellicoe), the Lord Shackleton and the Lord Byers.

HEATHROW AIRPORT: CONSULTING GROUP'S REPORT
3.23 p.m.
BARONESS BURTON OF COVENTRY: 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 there will be opportunity to debate the report on Heathrow Airport made by the Metra Consulting Group before any Government decisions on the recommendations therein are made.
EARL FERRERS: My Lords, the noble Baroness, like any other Member of your Lordships' House, is entitled to put down on the Order Paper any subject for debate, by a Motion or an Unstarred Question. Subjects for debate are, of course, customarily arranged through the usual channels.
BARONESS BURTON OF COVENTRY: Yes, my Lords, but I do not think that really answers the Question on the Order Paper. Could the noble Earl answer specifically what I have asked? I have not asked whether a private Member can put down a Question. I have asked whether there will be opportunity for debate before the Government take any decision on this report.
EARL FERRERS: My Lords, I am fully aware of what the noble Baroness put down on the Order Paper and I thought I had answered it. If what she meant was will the Government initiate a debate, I am bound to tell her that at the moment that is not our intention. But of course that does not prevent the noble Baroness from putting down for debate any subject she wishes.
BARONESS BURTON OF COVENTRY: My Lords, may I ask the noble Earl whether we shall be given advance information of the date of the publication of this report, or will it be necessary to put down a Question about that?
EARL FERRERS: My Lords, the report is not one which is to be published as such, but, as I have told the noble Baroness on previous occasions, it will be circulated to those interested and copies will be placed in the Libraries of your Lordships' House and of another place.
BARONESS BURTON OF COVENTRY: My Lords, will the House be informed in advance of the date when this report will be made?
EARL FERRERS: No, my Lords.

GENOCIDE CONVENTION
LORD JANNER: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper. Before the Answer may I offer my apologies to the noble Baroness for not having been present on the last occasion on which I tabled this Question. The fact is that because of traffic congestion I arrived a few minutes late.
The Question was as follows:
To ask Her Majesty's Government whether they will take steps in conjunction with other Governments to extend the provisions of the Convention on Genocide to provide compensation by the perpetrators of the crime to their victims and to the families of the victims.
THE MINISTER OF STATE, FOREIGN AND COMMONWEALTH OFFICE (BARONESS TWEEDSMUIR OF BELHELVIE): My Lords, I should like to thank the noble Lord for what he has said, and I am sure the whole House is very glad to see him in his place. The answer to his Question is this: No, my Lords, because genocide is currently under study by the Sub-Commission of the United Nations Human Rights Commission.
LORD JANNER: My Lords, does the noble Baroness realise that entirely apart from the moral distress, for which of course nobody can get any compensation, there is a tremendous need to see that the victims of this heinous crime are not deprived of reparation for the damage that has been done to themselves and their families? Would she inquire into the matter, bearing in mind the very serious and commendable way in which after the war the late Dr. Adenaur in particular and the West German Governments dealt with the material claims of the victims, and the manner in which such countries as East Germany are not dealing with reparations of a similar nature?
BARONESS TWEEDSMUIR OF BELHELVIE: My Lords, this particular study which I mentioned is on the prevention and punishment of the crime of genocide. Compensation is not specifically mentioned but the rapporteur will, of course, be able to draw on material which is available in connection with war crimes.
LORD JANNER: My Lords, would the noble Baroness please do her best to bring to the notice of those who are at present dealing with the project, the fact that there is terrible distress among people who have been the victims of the crime of genocide, and that that should be put right?
BARONESS TWEEDSMUIR OF BELHELVIE: My Lords, I agree that there is no doubt about there being terrible distress, but it is going to be very difficult to get agreement on adequate arrangements for compensation, because the most likely perpetrators of genocide are nearly always Governments, and there is at present no means by which a Government could be compelled to make reparation to the victims of its policies.

THE CASE OF MISS PADDON
3.30 p.m.
LORD MAELOR: 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 there is any means whereby the sentence of Miss Paddon to 21 months' imprisonment can be reviewed.
THE MINISTER OF STATE, HOME OFFICE (VISCOUNT COLVILLE OF CULROSS): Yes, my Lords, it is open to Miss Paddon to apply to the Court of Appeal, Criminal Division, within 28 days of the decision of the court of trial, for leave to appeal against both conviction and sentence.
LORD MAELOR: My Lords, I want to thank the Minister for that rather satisfactory reply. Is the Minister aware that not a single Member of this House would condone the crime of baby snatching? Nevertheless, a number of us believe that circumstances alter cases, and there were peculiar circumstances in this case. The

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two women were friends, and the child was only taken to its destination. I want to ask two further supplementary questions: first, if this young woman was deemed to be physically and mentally unfit to have charge of her own child, is she not, on the same score, unfit to suffer imprisonment for a period of 21 months? Secondly, the sentence was described in all the papers as both savage and inhuman. I hold no brief for the judge, but was this fair to the judge? Under the Criminal Justice Act 1961 the judge—
EARL JELLICOE: My Lords, I am quite certain that the question which the noble Lord is about to put is a perfectly legitimate one, but I think that he would be putting himself more within the normal rules of order of our House if he were to ask it straight away.
LORD MAELOR: My Lords, to put it then in the form of a question, is the Minister aware that under the Criminal Justice Act 1961 the judge can sentence a person if she is under 21 years of age either to no more than six months or no less than 21 months? Now that is a silly law, and I want to ask the Minister whether he will do all in his power to get it amended as soon as possible and so avoid putting judges in this invidious situation
VISCOUNT COLVILLE OF CULROSS: My Lords, I think it is a fundamental position, certainly when a sentence is still capable of being appealed upon to a higher court, that the Home Office and members of the Government should refrain from comment upon the action of the judge on the material which he had before him. As the noble Lord will know, that material is very substantial in a case like this, and we should, in general, leave the matter to be dealt with by the properly constituted appeal court, if there is an appeal and the appeal is still within time. I think I may be forgiven by the House if I do not comment upon the first part of what the noble Lord says to-day.
On the question of Section 3 of the Criminal Justice Act 1961, the House may recall that this was a fruitful subject of debate during the passage of the Criminal Justice Act which we were dealing with in the summer. The noble Lord is not entirely right in what he said; in
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fact, the sentence must be no less than six months and no more than 18 months in prison, but there is still the alternative of borstal, which is something he did not mention. As I explained at the time of our discussions on the Criminal Justice Bill, this is one of the matters in front of the Advisory Committee on the Penal System, which is going to report pretty soon on the whole range of matters dealing with young offenders. As I explained at the time, to pick this matter out at this juncture would I think be foolish, because we are having a proper review of it. The time to deal with it is when we have all the information and the advice before us.
LORD GARDINER: My Lords, may I ask whether it is open to the Official Solicitor to assist Miss Paddon?
VISCOUNT COLVILLE OF CULROSS: My Lords, the powers of the Official Solicitor never cease to amaze me, but I do not think that Miss Paddon needs the Official Solicitor at this stage because she has her own.
BARONESS SUMMERSKILL: My Lords, is it not a fact that before this young woman removed her friend's baby for a quarter of an hour she had been undergoing a course of psychiatric treatment? Is it the norm in our courts of law, when it has been proved that the person before the court is probably of abnormal mind, that he or she should be sentenced to 21 months' imprisonment?
VISCOUNT COLVILLE OF CULROSS: My Lords, I think the noble Baroness will appreciate that there is no rule in sentencing. The penalties laid down by Parliament are almost always as a maximum. The probation reports, the social inquiry reports and the other reports that are before the court are to enable the court to deal with the individual upon the merits of the offence, upon the background, upon his character, upon his previous convictions and upon all other relevant information. As I have said, I think I should be absolved at this stage, when we still have some weeks—I think a fortnight—to go before the time for appeal has elapsed, from commenting upon the decision that was made by Mr. Justice Boreham at Chelmsford Crown Court.
BARONESS GAITSKELL: My Lords, arising out of this case may I ask the Minister whether it is true that when a child is given to foster parents the mother is not allowed to see it, as in this case? The fact is that this mother was not allowed to see her child for 18 months. It was essential for her mental recovery that she should.
VISCOUNT COLVILLE OF CULROSS: My Lords, I think that that really is another question. It may or may not have been one of the matters that was in the reports before the learned judge who dealt with this case. The noble Baroness shakes her head. Whether or not it was, I stand by the opinion that it is for the Court of Appeal to consider all these matters if an appeal goes before it.
LORD BESWICK: My Lords, while agreeing with the noble Viscount that this would be a matter for the Court of Appeal, may I ask whether the noble Viscount can tell us that he has satisfied himself that this unfortunate woman is being properly advised legally with a view to making an appeal?
VISCOUNT COLVILLE OF CULROSS: My Lords, yes, most certainly I have. If there is one thing I have taken trouble to see about lately it is that the advice that is available to prisoners in Holloway, where she is in fact at the moment, is sufficient to cover all questions of bail and any other matter that might be relevant to somebody in this position. I am sure in this particular case that she is being properly advised, that she has seen her solicitor, and that the matter is very much under consideration. It is nothing to do with me, of course, what the advice may be.
LORD SHACKLETON: My Lords, I am grateful and I fully appreciate the noble Viscount's position. But if this unfortunate young woman is receiving advice and may, for reasons connected with her psychological state, be unwilling to take it, would it then be possible to take further action along the lines suggested by my noble and learned friend Lord Gardiner with regard to the Official Solicitor? As the noble Viscount will know, there have been famous cases in which, for one reason or another, people have refused to appeal.
VISCOUNT COLVILLE OF CULROSS: My Lords, the conviction was on October 30, the sentence was on October 31. There are twenty-eight days respectively from each date during which she can appeal. I do not want in any way to suggest that interference should take place. I take note of what the noble Lord has suggested and the noble and learned Lord has said. If it should be thought fit, this point would be further considered. If the occasion arises, I will certainly remember what they have said.
LORD DAVIES OF LEEK: My Lords, is the noble Viscount aware that his final answer about having looked into the affairs of this unfortunate young woman justifies our belief in his kindness and human understanding of the problems that he has to deal with? But may I ask him, if he considers it relevant, whether when investigations have been made into the law will be look into the problem of appeal—and I will use the ugly word—by the "under-privileged"? Is he aware that they are sometimes struck with terror? I know of two cases where people are absolutely innocent and cannot possibly make an appeal. Can we get some formula by means of which justice can be seen to be done in the courts of appeal? Can it be looked into, or am I entirely hopeless in asking for some reform?
VISCOUNT COLVILLE OF CULROSS: My Lords, the noble Lord is not hopeless. He is very kind to me. But if somebody has been received into a prison, whether it is Holloway or another one, the first line of defence against injustice is the staff of that prison. They have to be properly equipped with the information they need on technicalities. This is what I was talking about the other day when I was referring to cards in cells, and the material that is before them. Above all, the staff have to be trained in their understanding. They have to be trained to be able to pick up the sort of case that needs help. If the noble Lord went to some of these prisons and talked to the staff, I think he would be convinced that we have a fairly solid bulwark against injustice in the people who operate there.
LORD SHINWELL: My Lords, is the noble Viscount aware that it might satisfy many Members of your Lordships'

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House, if not all Members of your Lordships' House, if he could give an assurance that while this young woman is in prison she is receiving the medical consideration that her condition merits?
VISCOUNT COLVILLE OF CULROSS: Yes, my Lords. Again, this is where I have an advantage. I know the medical staff at Holloway, and having talked to them I have enormous faith in them. They are very skilled. They have a great diversity and range of experience and diagnostic and treatment powers. I think that the noble Lord, Lord Shinwell, can be assured that this young woman, like the others in our care, is being properly looked after and that we have the facilities to deal with any of her problems.

ABERDEEN HARBOUR ORDER CONFIRMATION BILL
Brought from the Commons; read 1a, and (pursuant to the Private Legislation Procedure (Scotland) Act 1936) deemed to have been read 2a and reported from the Committee.
SCRABSTER HARBOUR (VEHICLEFERRY TERMINAL &c.) ORDERCONFIRMATION BILL
Brought from the Commons; read 1a, and (pursuant to the Private Legislation Procedure (Scotland) Act 1936) deemed to have been read 2a and reported from the Committee.

COMMITTEE FOR PRIVILEGES
THE CHAIRMAN OF COMMITTEES (THE EARL OF LISTOWEL): My Lords, I beg to move the first Motion standing in my name on the Order Paper.
Moved, That in accordance with Standing Order No. 65, a Select Committee for Privileges be appointed, and that the following Lords, together with the Chairman of Committees and any four Lords of Appeal, be named of the Committee:

Lord Privy Seal (E. Jellicoe),

E. Dundee,

E. Longford,

E. St. Aldwyn,

L. Amulree,

L. Beswick,

822

L. Brooke of Cumnor,

L. Byers,

L. Champion,

L. Conesford,

L. Henderson,

L. Molson,

L. Rea,

L. Shackleton,

L. Strang;

That the Committee have leave to report from time to time.—(The Earl of Listowel.)
On Question, Motion agreed to.

PERSONAL BILLS COMMITTEE
THE EARL OF LISTOWEL: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That a Select Committee on Personal Bills be appointed, to which all Petitions for Personal Bills shall stand referred; and that the Lords following, with the Chairman of Committees, be named of the Committee:

V. Bledisloe,

V. Gage,

L. Cross of Chelsea,

L. Henley,

L. Stow Hill,

L. Wilberforce;

That the Committee have leave to report from time to time.—(The Earl of Listowel.)
On Question, Motion agreed to.

ATOMIC ENERGY AUTHORITY (WEAPONS GROUP) BILL [H.L.]
3.43 p.m.
THE SECRETARY OF STATE FOR DEFENCE (LORD CARRINGTON), My Lords, I beg to move that this Bill be now read a second time. The purpose of this Bill is to transfer the activities of the Atomic Energy Authority's Weapons Group, together with its associated property, rights and so on—in practice, the Atomic Weapons Research Establishment at Aldermaston and its outstations—from the Authority to the Ministry of Defence.
I should like to say right at the outset that the Bill does not involve any change in responsibility for nuclear weapons policy, but I will return to that point

823
later. Perhaps I may begin by reminding your Lordships of the arrangements for nuclear weapons research and development in the United Kingdom.
After the last war, this kind of work was first undertaken in part of what is now the Royal Armament Research and Development Establishment. However, the work demanded extensive and highly specialised facilities, and so a separate research and development establishment—the Atomic Weapons Research Establishment—was set up at Aldermaston. And in 1954 this establishment was transferred to the newly created Atomic Energy Authority, where it formed the basis for the Weapons Group. This now comprises not only Aldermaston but also a sizeable outstation at Foulness, and a few very small units mostly in the Aldermaston area. The main task of the Group, some four-fifths of its total effort, is research, development and production work on explosive nuclear devices for use in nuclear weapons; but the Group also undertakes some civil nuclear work as part of the Authority's programme, as well as some non-nuclear work on behalf of various Government Departments and outside customers.
As your Lordships know well, the problem of how best to organise Defence procurement has been with us for a great many years. When we came into office we set up a Project Team under Mr. Derek Rayner to study this problem, and its recommendations were published in a White Paper in April, 1971. The fundamental recommendation was that Defence procurement activities should be brought together into a single organisation within the Ministry of Defence; and this has been implemented by the setting up of the Procurement Executive inside my Department, embracing all aspects of Defence procurement from research through to production. An essential feature of the new organisation, to which I attach great importance, was the bringing together into the same organisation of all the Research and Development establishments concerned with defence. Apart from simplifying the policy control and direction, this has enabled a start to be made on rationalising the facilities and resources of the various establishments, and we are at present engaged in con-
824
sultations with the staff associations and unions on our proposals for the first stage of rationalisation.
One of Mr. Rayner's recommendations was that the Atomic Weapons Research Establishment should be brought within my Department. Following consultation with the Atomic Energy Authority during the summer of 1971, to see how best the functions of the A.W.R.E. could be rationalised with those of the other research and development establishments, the Government decided that this could be effected only if the Atomic Weapons Research Establishment were brought under the same management as the other establishments. I accordingly told your Lordships, in my Statement on August 5, last year, of our decision to transfer the A.W.R.E. to the Ministry of Defence. This Bill is to give the effect to that decision. Perhaps I may very briefly explain to your Lordships the principal provisions of the Bill.
Clause 1 gives effect to the main purpose of the Bill, and it provides that from the appointed day those activities of the Weapons Group which involve work on explosive nuclear devices will be carried out by the Ministry of Defence and not by the Authority, unless the Authority is specifically authorised or a contract placed with it to do such work. It also transfers the property and so on—everything connected with the property—of the Group to the Secretary of State for Defence, with the exception of patents and other industrial property to which I will return later.
Clause 2 deals with the effects of the transfer on the people at present employed in the Weapons Group. We want all the people engaged on work now performed by the Weapons Group to continue their jobs in the Ministry of Defence, and this clause terminates their contracts of employment with the Authority and enables them to be taken into the Civil Service. There have been consultations with the Civil Service Commission and I can say that all the Weapons Group employees will be offered immediate and continuing employment in the Civil Service.
My officials have been consulting with the staff and trade union representatives about the terms and conditions of service for staff who will be transferred, and I

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am happy to say that good progress has been made towards reaching agreement. Some adjustments to present terms and conditions will be necessary, but the general principle will be maintained that, taken as a whole, terms and conditions after the transfer shall be no less favourable than those provided for in existing contracts.
The terms and conditions of non-industrial staff in the Authority and Civil Service are already very similar in many respects. There are, however, certain differences, the most important of which concern superannuation and retiring age. The Authority's main pension schemes, unlike that of the Civil Service, are contributory; non-industrial staff pay contributions at the rate of 6 per cent. of their salary, and to allow for this their salaries are in general 7 per cent. higher than in the Civil Service. This means that their net pay is marginally higher—about one-half of 1 per cent.—and also that their pensions, being based on gross pay, are 7 per cent. higher. At the same time, the normal minimum retiring age for men is 65 instead of 60. We have therefore agreed that non-industrial staff should be able to remain in the Authority's pension scheme, with the associated pay and retiring age provisions, if they so wish. Clause 2 provides the necessary powers; and I should like to add the assurance that there is no question of staff who opt to stay in the Authority's scheme being compelled at some future date to change to the Civil Service scheme.
The case of industrial employees is rather different. Their pay and grading structure has evolved on different lines from that of the industrial Civil Service, and we are examining this to ensure that the transfer from one structure to the other goes smoothly. Where the rate for the job in the Industrial Civil Service is higher, those concerned will get the benefit; in other cases, existing pay rates will be retained until they are overtaken. Understandings have been reached between my Department and trade union representatives on these and other conditions of service. Clause 2 also preserves the powers of Authority constables who are transferred with the Weapons Group and taken into the Civil Service.
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My Lords, Clause 5, together with the Schedule, deals with the principles governing the exchange of information covered by patents and other technical information between the Secretary of State and the Authority. In general, the Bill leaves the ownership of existing patents and technical information with the Authority. This is because it has been found impracticable to segregate those patents which are relevant to the Weapons Group from those relevant to the civil activities of the Authority. There is, however, an important exception made under paragraph 3 of the Schedule, which is that information relating to explosive nuclear devices will become the property of the Ministry of Defence. But the Authority will be required to make available to the Secretary of State such facilities as he may need for the use of the patents remaining the property of the Authority. On the other side of the coin, the Bill also provides for access by the Authority to information of which custody and control will pass to the Ministry of Defence with the transfer of the Weapons Group. I think this is an important point, as the Government are anxious to ensure that the transfer of the Weapons Group does not impede the exploitation by the Authority of peaceful applications of nuclear energy.
Clause 6 is a logical consequence of the decision to transfer A.W.R.E. and its activities away from the Authority. The Authority's powers under the Atomic Energy Authority Act 1954 to produce, use and dispose of atomic energy and to carry out research were subject to the restriction that they were not permitted to develop or to produce any weapon or part of a weapon except in accordance with arrangements made with the then Minister of Supply and now with the Secretary of State for Defence. However, Section 2(2) of the 1954 Act empowered the Authority to conduct on their own initiative experimental work which might lead to improved types of explosive nuclear assemblies for use in weapons. Now that the responsibility for carrying out all work on explosive nuclear devices and the facilities for undertaking it are to be put into my Department, this power is now redundant and is repealed by Clause 6. Additionally, Clause 6 widens the prohibition placed on the Authority, in that it provides that they are not to undertake

827
any work on explosive nuclear devices, whether for warlike applications or otherwise, except in accordance with arrangements made with the Secretary of State.
My Lords, I will not dwell on the financial arrangements which are the subject of Clause 8, except to say that the net cost to public funds will be affected by the Bill only to the extent that, as I explained in dealing with Clause 2, there are some differences in the terms and conditions of service of employees of the Atomic Energy Authority and those of the Civil Service. Since negotiations are still in progress I cannot put a figure to this, but it seems unlikely that the cost will increase by more than £200,000 a year.
My Lords, perhaps I may end by making some rather more general comments. First, I hope that the transfer can take effect from April 1, 1973, both for organisational reasons and so that we can end the uncertainties for the staffs concerned. Following my Statement on August 5, 1971, it was suggested that to place the production of warheads for nuclear weapons directly under the control of the Secretary of State for Defence, and no longer under a separate Minister responsible to the Cabinet for nuclear matters generally, raises a point of constitutional significance. I think that this criticism overlooks the fact that in this very important area the responsibility for policy has been, and under the proposed new arrangements will continue to be, a collective responsibility of Her Majesty's Government. This applies as much to decisions on the nuclear weapons programme as to decisions on strategy, and this responsibility would in no way be lessened by the measures now proposed.
The Secretary of State for Defence is, and will continue to be, the departmental Minister responsible for giving effect to the Government's approved policy. At present, the development and production by A.W.R.E. of nuclear warheads required for the weapons programme is carried out under contracts placed by the Ministry of Defence with the Authority. After the transfer this will become a matter for direct management within the Ministry of Defence. In other words, there will be a change in the administrative methods, but no change in the essen-
828
tial responsibility. The work of the Weapons Group is predominantly military, and I am quite sure that it is right to bring it into the Ministry of Defence along with the other Defence research and development establishments, and under a single management organisation. It is only in this way that we can so use our resources as to meet the needs of Defence programmes in the most efficient and flexible way.
But in stressing the predominantly military nature of A.W.R.E. I am by no means overlooking the considerable contribution which it has made to basic nuclear technology, nor the extent to which the skills and special facilities at Aldermaston have been used to great advantage in some aspects of the civil nuclear power programme. Civil work at present carried out at A.W.R.E. accounts for about a fifth of the establishment's effort. Part of this is devoted to the Authority's research and development programme on the fast breeder reactor, most of which, of course, is carried out in the Authority's Reactor Group.
I can assure your Lordships that this work, together with the other civil work at A.W.R.E., will continue uninterrupted: the expertise and facilities at A.W.R.E. will be made available to the Authority and the Department of Trade and Industry under contracts which they will place with the Ministry of Defence. I am particularly concerned that my Department should maintain close relations with the Authority and the Department of Trade and Industry, just as it has in the past in connection with the military programme. All we are doing is simply reversing the present contractor-customer roles. Your Lordships may wonder about the effect that this transfer will have on the remainder of the Authority, and I can say here that the remaining part of the Authority—that is, the Reactor and Research Groups and the Safety and Reliability Directorate—will retain a vital role in the further development of nuclear reactors and other civil applications of nuclear research.
Finally, perhaps I may remind your Lordships that at the end of the last Session my noble friend Lord Alport urged Her Majesty's Government to ensure that in the present Session an appropriate number of Bills should be introduced in this House; and I recall that this proposi-

829
tion received a wide measure of support. My Lords, this Bill is my contribution to meeting the wishes of the House, and I hope—though I doubt it—that it will earn your Lordships' gratitude and will be given an unqualified welcome. I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read 2a.—(Lord Carrington.)
4.0 p.m.
LORD WINTERBOTTOM: My Lords, picking up the last point of the Secretary of State's speech, I am certain that the House is grateful for the acceptance of its view, expressed so forcefully, that the early introduction of important legislation should take place more frequently than in the past. This has its disadvantages because I have been pitchforked in at a late stage and at rather short notice to reply to the Secretary of State on this Bill. The Bill itself is of interest. Of course, as he said, it does not come in any way as a surprise. It was recommended by Mr. Rayner and foreshadowed by the Secretary of State himself last August. As I myself said in the House, I think that the new system of procurement for weapons and other forms of defence equipment is to be welcomed. So far as I can see at this moment the new system is working well. I personally have no criticism of it.
But having said that, there are one or two questions that I should like to put to the Secretary of State at this stage. The time scale seems to have slipped a little. The Rayner Report, so far as I can recall, suggested that this transfer of the Weapons Group should take place on April 1, 1972. It is now taking place in April 1973. The complex negotiations with the Civil Service, or, rather, with the employees of the Atomic Energy Authority relating to their transfer to the Civil Service, seem to have dragged on. Again, my information, although it may be imprecise, is that some of the key negotiations were started only on the 2nd of this month. So, perhaps, when he replies the Secretary of State might indicate where the friction and difficulties have come about in the transfer of the Weapons Group to the Civil Service and to the Secretary of State's own Department. I know how difficult these things
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are and I am not making a big thing of it, but there seems to have been some slip.
Taking the list of clauses that the Secretary of State mentioned, may I ask one question on the transfer of the out-station at Foulness? Is this out-station going to remain at Foulness or, when the great airport is established, will it have to go somewhere else? My own recollection is that it lies to the North of the airport and therefore could remain undisturbed. But I think that noble Lords would like to know about that. Clause 4 deals with personnel. May I say that I have one or two probing Amendments to put down at the Committee stage? I am certain that the various issues are not of first importance; nevertheless, I think that a public clarification of the situation would be welcomed by the thousands of people concerned in their transfer. I have heard that negotiations are going reasonably satisfactorily but a statement in this House is always helpful.
I turn to patents. Perhaps I might link that interesting subject with a question which I think is of importance and which relates to the whole of the financial implications for the Defence budget, of the transfer of this very substantial organisation from the United Kingdom Atomic Energy Authority to the Defence budget. I believe that we are reaching a critical stage in the financing of our defence programme. I touched on this matter last week and I will raise it again on the Order which I think we are to discuss on Tuesday next. I think it might be useful to do so then. But certain important new weapon systems are coming into being. If we talk about comparability, if the Serviceman is to be paid the equivalent of his counterpart in civilian life (as he now is) this very labour-intensive activity will cost a great deal more just in paying the troops. At the same time, the cost of the advanced technology that we must have if we are to achieve our defence aims will go up. So we are now transferring 5,700 individuals plus, presumably, a great deal of production costs to the Defence budget from whatever budget covers the Atomic Energy Authority. I hope that this transfer will not, as it were, be forced into a straitjacket and result in a reduced amount of resources required for defence. During the last debate, the noble Baroness. Lady Tweedsmuir,

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pulled my leg on this. I stand unabashed by what I said then. I think it is of importance and per contra I am hoping that a share of any of the earnings that may come from the patents which apparently remain with the Atomic Energy Authority will come as appropriation in aid against the expenses arising from the transfer of this large establishment.
My Lords, those are really the only points that I have to make. There is no doubt that the work done by the Weapons Group and the Atomic Energy Authority has kept this country in the forefront of technical advance—though perhaps we have not used the knowledge that we have acquired as wisely as we might. Nevertheless, the very great nuclear energy programme that we have undertaken in this country—and some extremely interesting other research work has been done as a result of studies here—is of tremendous importance to our standing in the world as a nation capable of understanding and executing advanced technology. I am glad that the cross-fertilisation of ideas between the Weapons Group and the rest of the Authority will continue. I am glad that the Secretary of State has given this assurance which I am sure will be welcome by everybody working in the Authority as a whole.
4.6 p.m.
LORD WYNNE-JONES: My Lords, I am sure that when the noble Lord, Lord Carrington, says that the introduction of this Bill into your Lordships' House is something for which we should be grateful, we are grateful. But I hope that the noble Lord does not really mean that, because we are grateful to him for bringing the Bill first to this House, we are therefore not allowed to discuss it. He suggested that we ought to give it an unimpeded Second Reading because we are so grateful for his action in bringing it here. I believe that our best way of showing gratitude is to show that we take the Bill seriously and are prepared to discuss it in depth.
This particular Bill is one which at first sight seems quite reasonable; but I wonder whether, when we look at it carefully, it is really such a reasonable Bill. We used to have an Atomic Energy
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Authority. That Atomic Energy Authority has been split up. We have had a Nuclear Installations Act, which separated the nuclear installations part from the Atomic Energy Authority. We now have this Bill dealing with the weapons side, removing the weapons side from the Atomic Energy Authority. One of the great advantages of having a single overall Authority to deal with all atomic energy is that the whole of it is really one field.
The noble Lord said that in this Bill—and we see it when we look at the details of the Bill—any matter dealing with explosive nuclear energy is to be removed from the Atomic Energy Authority and brought under his own Ministry. This is a very queer sort of decision; because in one sense all atomic energy is explosive. One can set a certain defined limit: one can say that when the reproduction rate is less than 1 it means that you do not get an explosion; and that when it is greater than 1 you do get an explosion. This is a question of the chain length of atomic reaction. But this is a very arbitrary way of dealing with the whole matter. Supposing that we had decided to deal with the burning of eases in this way and were to say that any gaseous mixture that exploded was to be the business of the Defence Ministry; whereas any gaseous mixture which did not explode should be dealt with in some other Ministry. We should end up with a ludicrous situation because, after all, every motor car engine has an explosive mixture in it, and in fact progresses by a series of explosions inside the engine. So this is a very queer way of separating off a particular field of work. It is certainly reasonable to say that it is the business of the Ministry to be dealing with actual weapons. But this goes far beyond dealing with actual weapons; this deals with the whole study of all those matters which concern atomic explosion. This, in all rational procedure, would surely be the business of the Atomic Energy Authority, and to separate this arbitrarily from the Atomic Energy Authority and put it under the Ministry of Defence is I believe a retrograde step. I think it a move entirely in the wrong direction.
My Lords, when one is dealing with the application of scientific work to weapons it is important to realise that most of the

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essential basic scientific work comes not from the weapons side but from the investigation of the scientific problem itself; in other words, it is the Atomic Energy Authority which should, and probably will, supply most of the ideas. The noble Lord neatly inverted the whole position at the end when he said that he was going to have the consumer/contractor basis reversed. Exactly, my Lords. But what has he done? He has turned it not into a consumer/contractor basis at all, but rather on to the basis that it is the consumer who also does the contracting. In other words, the Ministry of Defence, the consumer, is now also to be the contractor. This is the exact opposite of what is meant by the consumer/contractor basis. I submit that the real purpose of the Bill and its effect has not in the least been made clear. It seems that it is an attempt to take a substantial amount of work and put it under the particular Ministry which likes to feel that it will have control.
During the war I spent some years in a Government Department working exactly in this kind of way. I was at the Royal Aircraft Establishment which was responsible for those matters which concerned military aircraft. It can be said that anyone had access to what they did, but that is quite untrue. You had access to what was done in the Royal Aircraft Establishment only if you were engaged on military work; if you were engaged on producing either aircraft for military purposes or anything concerned with aircraft for military purposes. This, so far from making the work better, made it worse. It inhibited development because, by restricting it in this way, the proper flow of information from the industrial and scientific bodies concerned with main development to the Royal Aircraft Establishment was never really fruitful.
It is true that the Royal Aircraft Establishment was usually able to get the information it wanted, but it was very difficult for bodies outside the Royal Aircraft Establishment to get hold of the information which was in the Establishment. That could have been useful for civil aircraft but it was not made available. It was only after the war when there was a deliberate attempt to break this down that any real progress was made. I think that the Royal Aircraft Establishment has
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improved enormously by being less of a military establishment than it used to be. It did excellent work at the time of the Comet disaster. A special tank was set up for investigating how the Comet had failed. And recently excellent work has been done on the "Concorde" development. But these are things which are being done not as military projects at all but as civil projects, and I submit that the attempt to separate the military from the civil in this way will be very much to the disadvantage of both.
My Lords, there are two other points that I should like to mention. The noble Lord has explained to us that the position of the staff will be properly safeguarded and I am prepared to accept what he says. But I would ask whether he has an assurance from the unions concerned that they are satisfied, because this is a very important matter. If the unions are not satisfied there may be some difficulties. The second point I would raise concerns safety. The noble Lord, Lord Drumalbyn, will remember that when the Atomic Energy Authority Bill was before your Lordships' House I raised the question of the safety of installations and asked to what extent the unit inside the Authority would in future be concerned with the safety of installations. As the noble Lord will remember, he gave assurances at the time which I was glad to have. But, as I pointed out to him then, I did not feel that they were as satisfactory as actually writing them into the Act. I believe this to be an important question because over a number of years the Atomic Energy Authority has had a unit at work dealing with safety in connection with nuclear work of all types, and they have an immense amount of expertise. When one separates off different parts of the work from the Atomic Energy Authority one ought to make certain that the services of that unit are fully available to any other body which is set up. I believe that where one has, for instance, nuclear installations in the country, it ought to be compulsory for them to consult this unit. That is not so at present, and I think that it should be. I believe, also, that if one is to have what at the moment I do not approve of—that is, the separation of the weapon section from it—in the same way there ought to be this same unit responsible for nuclear security.
4.18 p.m.
LORD GLADWYN: My Lords, I would not want to oppose this proposal to transfer the Weapons Group from the Atomic Energy Commission to the Ministry of Defence; frankly, I do not know enough about the techniques of the matter to express a very competent view. But I would join with the noble Lord, Lord Wynne-Jones, in asking the Minister to explain in a little more detail, if he can, what was the actual compelling motive, the underlying reason for this, on the face of it, rational and logical reorganisation. Perhaps I got him wrong but I think I heard him say that the responsibility for giving the green light to any new development in the field of atomic weapons and new devices is collective—just as is the policy and strategy in the use of atomic power. Also that under the existing arrangements his Department was quite competent to see that the new kind of devices were what they wanted; that the general policy to be pursued was his, and that he was in any case in a position to give effect to it. If that is so, my Lords, why was it necessary to proceed with what is, after all, a rather complicated and difficult transfer involving all kinds of details—Service pensions, and goodness knows what?
Secondly I should like to ask, and in this I think I can follow the noble Lord. Lord Wynne-Jones: was there any material opposition to this proposal? Were the Atomic Energy Commission themselves happy about it? Or was any view expressed on the general lines of Lord Wynne-Jones's suggestion, that perhaps it might be better to leave things as they are; that the existing system is not necessarily inefficient; that you could make an equally good case, or almost an equally good case, for letting atomic energy be developed as a whole rather than splitting it up into its war weapons and its peaceful components? I cannot venture a definite opinion myself, but I think it might be in the general interest if the noble Lord could come a little cleaner on these rather fundamental questions.
4.21 p.m.
LORD DAVIES OF LEEK: My Lords, as someone who has links with a laboratory that has had the privilege of using some of the research and some of the work done by the Atomic Energy
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Authority, I should like to pay tribute to the Atomic Energy Authority for the research work it has done in the field of radioactive isotopes and in other fields that are used in biochemistry and medicine. When I uttered a "Hear, hear!" as the Minister was speaking, he hinted that the peaceful uses of the atom would still go on as before. But Lord Sherfield's book on the future of atomic energy, which he was kind enough to present to the Library of your Lordships' House, puts forward certain caveats and other things at which we should be looking.
To say, "I would put forward this warning", might sound a little too pompous and didactic, so let me put it interrogatively. Are we likely to recruit the same quality of scientific experts to the Atomic Energy Weapons Division as we should to the whole atomic energy body if it were kept as one group? There is a growing resentment among many scientists in the world at the particularisation of atomic energy merely on the explosives side. I do not wish to repeat questions that have already been put by noble Lords, but there are certain questions to be asked. I think this is a good opportunity to pay tribute to the Atomic Energy Authority for the work they have done in the field of medicine and biochemistry to help people in research and for some first-class cures that have been made possible as a result of their work.
4.23 p.m.
LORD LEATHERLAND: My Lords, unlike my noble friend Lord Wynne-Jones, I am not a professor of science. Where affairs in Essex are concerned, I am merely one of the locals. I want, very naïvely and innocently, to ask a question, and I hope that the answer will clarify my present state of mind. The word "Foulness" has sprung up again in a new guise. I had a few words to say a year or so ago in its old connotation in connection with the airport. Clause 1 of this Bill deals with the atomic aspect of Foulness. It does not mention the Shoeburyness military experimental establishment. I should like to know whether the non-atomic part of the Shoeburyness experimental establishment is to be taken over. I presume not. Will the atomic element in the Foulness establishment remain there when the airport is open? My noble friend

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Lord Winterbottom has touched on this point, and I think it is important that we should have a reply from the Minister.
My Lords, it was my educational pleasure a year or two ago to go round Foulness, properly escorted, of course, and what I saw happen there during one minute of my visit rather startled me, and would probably startle a pilot who was coming down to land on the new Foulness Airport. So I am asking whether, when the airport is ready, this atomic portion of Foulness Island will be transferred to some other place. Incidentally, I might ask at the same time when the Shoeburyness experimental establishment is to be transferred. And will this new proposal contained in the Bill have any effect in delaying the construction of the airport?
4.25 p.m.
LORD CARRINGTON: My Lords, perhaps I might first of all associate myself with the tribute paid by the noble Lord, Lord Davies of Leek, to the Atomic Energy Authority for what they have done in the peaceful uses of atomic energy. I think we should all join in that tribute. Certainly it is the intention of my Ministry to co-operate, to collaborate and to offer the facilites at Aldermaston in exactly the same measure as they have been offered in the past when the establishment has always had to cope partly with the military side and partly with the peaceful side of nuclear energy.
My Lords, let me try to answer some of the questions that have been put to me by various noble Lords. It is perfectly true, as the noble Lord, Lord Winterbottom, said, that the time-scale slipped; indeed, this Bill is exactly one year later than we had hoped it would be. The delay has nothing to do with the negotiations, but is entirely due to the legislative programme last Session. If your Lordships recall sitting most of the time through the Summer Recess, you will appreciate that to have imposed the present Bill upon that legislative programme would have ensured that it would receive an even more wintery reception than it has had, I am sad to say, from some of your Lordships this afternoon. I think we should have had to carry out the negotiations very much more quickly with the staff side and the unions than we
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have done. But there have been some quite difficult points to resolve. I can assure your Lordships that, apart from some comparatively minor points, there is nothing outstanding which has not been agreed. I believe that the assurance I have given this afternoon about employment, pensions and so on, together with a letter that I have written earlier to-day, should meet the very proper anxieties of those who work in the Atomic Weapons Research Establishment.
Both the noble Lord, Lord Winterbottom, and the noble Lord, Lord Leatherland, asked about the out-station at Foulness. This, as noble Lords will realise, is quite unaffected by the Bill. The Bill does not do anything about the out-stations: all it does is to transfer their management to the Ministry of Defence. There is no nuclear testing going on at Foulness. But of course we are examining whether or not the high explosives which are used in conjunction with the nuclear programme are really compatible in that location with a new airport; whether it will be necessary to move it, and if so, to where. I would only remind your Lordships (the noble Lord, Lord Leatherland, knows that the Shoeburyness station is going to be moved) that if by a decision on the siting of the Third London Airport you make it impossible to leave the Shoeburyness station or the Foulness station, about which we are talking here, at that place, then it is necessary to re-locate them somewhere else. I hope your Lordships will understand that if we are to have defence forces in this country there must be ranges where there can be testing and experiment.
I perhaps understand even better than the noble Lord, Lord Winterbottom, the pressures that there are on the Defence Budget, and in particular the increasing proportion of the Defence Budget which is spent on personnel rather than equipment. This is something which is affecting the Defence Budgets of every country in the West, but, of course, for obvious reasons, does not affect the countries of the Warsaw Pact in the East. This is something about which we shall increasingly have to be concerned, and I shall be glad to have a debate with the noble Lord about it next Tuesday. But, in so far as his concern is that the inclusion in the Ministry of Defence of the A.W.R.E. will have an effect on the Defence Budget, I

839
am glad to tell him that this is not so, because we already pay for it; it is already on the Defence Budget, and does not have any effect on it except in so far as the different terms and conditions of service will increase it by, as I think I said, about £200,000 a year.
The noble Lord, Lord Wynne-Jones, and to a lesser extent the noble Lord, Lord Gladwyn, questioned the whole principle upon which this Bill is based. I confess that I start from an entirely different standpoint. I start from the standpoint of the Minister who has to run a Defence Budget of some £3,000 million a year and get value for money. A very laree part of the money—not perhaps such a large part as we should like—is spent on research and development and production. I do not believe it is possible to use economically the resources which I have at my disposal at the Ministry of Defence unless I am actually managing all the establishments where there is research and development and production for the Armed Services. For me, this makes an absolutely unanswerable case for transferring the A.W.R.E. to the Ministry of Defence, where four-fifths of its production—an enormous proportion—is on defence equipment. For my part, I regard it as absolutely essential, if we are to control the Defence Budget, to rationalise and to run things sensibly, that the Minister in charge of Defence should have the management of these out-stations.
I was rather interested to see that the noble Lord should have chosen the Royal Aircraft Establishment at Farnborough as the example with which he hoped to beat me, because I am wholly responsible for the Royal Aircraft Establishment at Farnborough, and the noble Lord, if I understood him rightly, was praising the civilian work that that Establishment does. My Lords, I see no difference between the Royal Aircraft Establishment and the proposals which are in this Bill about the A.W.R.E. I assure him, if such assurance is necessary, once again that the civilian side of the A.W.R.E. at Aldermaston will go on in exactly the same measure as it has done in the past, with the co-operation of the Ministry of Defence. Does the noble Lord wish to interrupt?
LORD WYNNE-JONES: I thank the noble Lord. My point was that the A.W.R.E. used to be entirely a military establishment, and since the last war it has moved more towards civilian work. This, I think, is a very good thing and I can only hope that under the noble Lord's direction the Atomic Weapons Research Establishment will also move in the same direction.
LORD CARRINGTON: My Lords, I do not know that it will move in the same direction, because 20 per cent. of the work done there is already civilian work, and I should not like to see any decrease in the proportion of the work done for the Ministry of Defence when such work needs to be done. But, as I have told the noble Lord, I have every intention of seeing that the civilian work goes on in exactly the same measure as in the past.
I forgot to say earlier to the noble Lord that there is no intention of trying to stifle discussion on this Bill. I was merely trying to congratulate the Government, and in particular myself, on having honoured a pledge to bring in a Bill at the start of a Session. However, having sat in this House for many years now, I am not so foolish as to suppose that a remark of that kind would stifle any kind of discussion that your Lordships might wish to have.
The noble Lord, Lord Wynne-Jones, asked me two other questions: first of all, whether the unions were satisfied. I think I answered that point in my reply to the noble Lord, Lord Winterbottom. There have been some difficult negotiations, but I think that they are pretty well all right now. I can assure him that the safety arrangements will be exactly the same and that we shall have the same call on all these safety arrangements as we have now. I think I answered just now the point raised by the noble Lord. Lord Gladwyn; I do not think I need to "come cleaner". I have told him why I wanted the A.W.R.E. to become part of the Ministry of Defence: because it seemed to me straightforward and logical. There was nothing wicked or underhand about it, and I hope he will feel that—
LORD GLADWYN: My Lords, I was not suggesting that for a moment. All I was saying was that I understood from

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the noble Lord's speech that at the moment he had complete control of this weapons group. Therefore, if he had complete control at present as regards production and so on, what was the real necessity for transferring it? Really, I only asked a question.
LORD CARRINGTON: My Lords, the reason is because I do not manage the group. It is managed by the Atomic Energy Authority. All I want to do is to manage it, because I spend the money, and it is spent largely on defence equipment. This is the whole purpose of the Bill.
My Lords, I said at the outset that I hoped the Bill would have the unqualified support of your Lordships. Of the noble Lords who have spoken, none gave it unqualified support, but perhaps I may take it that on the whole your Lordships, with the exception of the noble Lord, Lord Wynne-Jones, accept the principle of the Bill; and no doubt we can debate during the Committee stage some of the other points that have been raised by your Lordships this afternoon.
On Question, Bill read 2a, and committed to a Committee of the whole House.

SUPPLY OF GOODS (IMPLIEDTERMS) BILL [H.L.]
4.36 p.m.
THE MINISTER WITHOUT PORTFOLIO (LORD DRUMALBYN): My Lords, on behalf of my noble friend Lord Limerick. I beg to move that this Bill be now read a second time. The Bill is the first of a number of measures to help the consumer that the Government will be bringing before Parliament this Session, and I hope that your Lordships will be pleased, as I am, that it is being first introduced into this House. It should have fallen to my noble friend Lord Limerick to introduce it as it lies in his sphere of responsibility, but as he is at present representing Her Majesty's Government on a mission abroad, he has asked me to introduce it for him. I do so with pleasure, as I have for some years advocated the implementation of the substance of the recommendations in this regard of the Molony Committee on Consumer Protection.
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I must confess that I am a little daunted by the large array of lawyers on the list of speakers to-day. I feel rather as if I were in a den almost entirely occupied by legal lions, and the only exception, the noble Baroness, Lady Phillips, is identified with the protection of the consumer. As one who is likely to be consumed in this particular debate, all I can say is that I rely upon her mercy, and I hope that the legal luminaries will also temper justice with mercy if they find that my speech deserves it.
One of the tasks that one has to perform in a debate of this kind is to try to make a Bill comprehensible to both legal and lay Members. I think, however, that the phraseology is sufficiently well known to your Lordships for me not to have to define my terms as I go along. The Bill is concerned mainly with two things; first, with those provisions of the Sale of Goods Act 1893 which set out the rights of buyers of goods; and second, and more important, with preventing the circumvention of those rights that the Act at present allows. The Sale of Goods Act provides in Sections 12 to 15 that certain terms shall be taken as implied in all contracts for the sale of goods. These terms are either "conditions", breach of which entitles the injured party to treat the contract as rescinded, or "warranties", breach of which entitles the injured party to claim damages for any loss that he has incurred. The terms cover four aspects. As to title, there is an implied condition that the seller has a right to sell and implied warranties that the goods are free from any undeclared encumbrance and that the buyer will have quiet possession. In sales by sample, there are implied conditions that the bulk shall correspond with the sample in quality; that the buyer shall have a reasonable opportunity of comparing bulk with sample; and that the goods shall be free from any defect not apparent from the sample. On a sale by description there are implied conditions that the goods correspond with the description and are generally of merchantable quality. And finally, if the buyer makes known a particular purpose for which the goods are required, there is generally an implied condition that the goods supplied will be reasonably fit for that purpose.
These rights, my Lords, are plainly very valuable to buyers. For many years,

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however, there has been concern that they have too often been whittled away or denied almost entirely by the operation in contracts of sale of exclusion clauses permitted under Section 55 of the 1893 Act. At one time (although I believe this is much less prevalent than it was) it became almost impossible to buy a new car without signing away these rights in the process. Many people buying electrical appliances have signed and returned the so-called "manufacturer's guarantee" and later been led to believe that by so doing they have excluded or limited their rights under the Sale of Goods Act. The buyer's rights lie in his contract with the seller and cannot normally be excluded by the manufacturer's guarantee. However, there has been much confusion in this area in the past and the Bill will clear it up.
The matter was first considered by the Committee on Consumer Protection under the Chairmanship of Sir Joseph Molony, Q.C. Although they were satisfied that the Sale of Goods Act provided a satisfactory framework of protection for the consumer, they drew attention to the favourable position which traders enjoy by virtue of Section 55 of the 1893 Act. It was noted that except where, through oversight or design, traders omitted to exclude their liability under Sections 12 to 15 of the Act, they were,
"under no obligation to sell goods which conform to any particular standard of quality or performance."
The Committee commented:
"We feel compelled to view the practice as a general threat to consumer interests, in the sense that heavy and irrevocable loss may fall on the consumer who is unlucky enough to get a defective article."
In their Report, published in 1963, the Committee recommended not only improvements from the consumer point of view in certain of the conditions implied in a sale of goods, to which I shall come in a minute, but also that in general it should not he possible for the implied terms to which I have referred to be excluded in a consumer sale.
The Committee's recommendations clearly had implications beyond the field of consumer policy. The Sale of Goods Act of course covers all contracts relating to the sale of goods, not merely those concerned with consumer sales; but the Committee's terms of reference were not
844
wide enough to embrace these. The whole subject was therefore referred in 1966 to the Law Commission and the Scottish Law Commission for study, together with the questions of exclusion of liability for negligence and the use of exclusion clauses in contracts for the sale of services. The Commissions' studies on the last two of these are continuing; but they published their First Report on Exemption Clauses in Contracts in September, 1969. In it they reviewed the rights afforded to buyers by Sections 12 to 15 of the Sale of Goods Act and considered whether, and in what circumstances, it should be possible to exclude them. They recommended draft clauses to amend the relevant sections of the Act; these draft clauses form the basis of the present Bill.
On the main issue, the Law Commissions unanimously endorsed the view of the Molony Committee that sellers to private purchasers should not be allowed to exclude or limit the protective provisions of the Act. These they regarded as a basic code of fair dealing which should be seen unequivocally to apply to all consumer sales. The Commissions also agreed that the ban on exclusion clauses should extend beyond sales to private purchasers. They considered that the implied conditions and warranties relating to title should not be excluded in business sales. They were, however, equally divided as to the manner in which any further extension of protection of business purchasers should be achieved and how far it should go.
Their Report therefore put forward alternative recommendations. The first proposed that the bar on exemption clauses should cover the sale of consumer goods to business purchasers except where the buyer could be said to be in the business of dealing in, or with, the goods. This was intended to protect, say, a professional man buying a car for use in connection with his practice when he is usually in no stronger bargaining position than an ordinary consumer. It would, however, have left other business dealings to be settled by the buyer and seller on whatever basis suited them. The second alternative proposed the protection of all business buyers (including retailers upon whom their suppliers might have imposed exemption clauses) by enabling the courts to strike out any

845
exclusion or limitation of liability if in all the circumstances to rely on it would be unfair. For reasons which I shall explain, it is this second alternative which has been adopted in the Bill—to which, after that brief outline of the history, I now turn. Before doing so, however, I should like once again to express our indebtedness to Sir Joseph Molony and his Committee, and also to the Law Commissions.
In line with the recommendations of the Law Commissions, the primary aims of the Bill are: first, to restate and bring up to date the conditions and warranties implied by the 1893 Act; second, to make void exclusion clauses in consumer sales; third, in business sales to make void exclusion of the implied conditions and warranties relating to title; and fourth, to regulate the exclusion in business sales of the other conditions and warranties implied in the Act. The Law Commissions' comprehensive examination of these matters, as set out in their First Report, related only to the appropriate sections of the Sale of Goods Act. We have thought it right to go beyond this and extend the scope of the Bill to sales involving hire purchase, to conditional sales, and to the exchange of trading stamps for goods. We believe that the same rights should be accorded to a buyer, whether he buys for cash or on credit and, in the case of a consumer, whether he acquires goods by purchase or by the exchange of trading stamps. Those pants of the Bill which deal with hire-purchase and trading stamps bring these forms of trading as far as possible into line with the sale of goods.
Against this general background it might be helpful to mention some particular points on the detailed provisions of the Bill. The first three clauses repeal and re-enact Sections 12 to 14 of the Sale of Goods Act. Clause 1 of the Bill makes no substantial changes to Section 12 of the Act, which deals with implied conditions and warranties as to title. The intention is that these rights should not be excludable in any sale, but it is necessary to provide for sales of limited title; for example, cases where the seller is unsure of his title, as he might be if he received the goods as a gift and received no warranty as to title. This provision is made in Clause 1(2). Section 13 of the Sale of Goods Act provides mainly that in a
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sale by description there is an implied condition that the goods shall correspond with the description. This is not altered, but Clause 2 adds a subsection to take account of the recent developments of self service where a buyer chooses goods for himself without actually speaking to the seller. The mere fact that no words are spoken is not to prevent the sale from being a sale by description. It is sufficient if the description is on or alongside the goods.
Clause 3 of the Bill restates the implied conditions and warranties concerned with merchantable quality and fitness for purpose at present set out in Section 14 of the Act. It provides, as both the Molony Committee and the Law Commissions recommend, that in any contract of sale where the seller sells in the course of business there shall be an implied condition that the goods supplied shall be of merchantable quality. This will no longer depend on the sale being "by description" and on the seller being a dealer in goods of the kind involved in the sale. The exceptions will be those dictated by common sense, such as defects specifically drawn to the buyer's attention before a sale, or defects which a buyer who examined the goods before buying ought to have seen. Further, under the existing provisions the condition as to merchantable quality is not implied in any sale by a private person, whether through an agent or otherwise. The Commissions found this unsatisfactory. They believed that a buyer purchasing goods otherwise than direct from the owner would frequently be unaware of the status of the owner. So Clause 3 now provides as the Commissions recommended that the condition shall be implied in sales by agents, except in cases where it is made clear that the sale is on behalf of a private person. The concept of "merchantable quality" is given, for the first time I believe, a statutory definition in Clause 7 of the Bill.
I now come to the nub of the Bill, which is Clause 4. What Clause 4 does is to leave Section 55 of the Sale of Goods Act as it is, but then to add substantially to it in such a way as to limit very severely the present freedom to exclude by contract the implied conditions. Thus the new subsection (3) provides that no exclusion in any sales of the implied

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terms as to title, freedom from encumbrance and quiet possession is to be allowed. Subsection (4) relates to consumer sales. It gives effect to the joint unanimous view of the Molony Committee and the Law Commissions that in consumer sales the clause excluding other implied conditions and warranties in the Sale of Goods Act should be void.
The definition of a "consumer sale" in subsection (8) is important. "Consumer sale" means any sale of goods by a seller in the course of business where the goods are of a type ordinarily bought for private use or consumption and are sold to a person who does not buy or hold himself out as buying them in the course of business. But sales by auction and by competitive tender are excluded. The Law Commissions were divided on whether sales by auction should be subject to any general ban on exclusion clauses. Auction sales have special features which justify different treatment from normal consumer sales. Like sales of goods by competitive tender, they are generally of a more speculative nature than ordinary sales and are recognised as a legitimate means of selling goods whose quality cannot be guaranteed. We have therefore thought it right to exclude both of them from the definition of "consumer sale".
There remains the question of what should be done about exclusion in business sales of implied terms other than those relating to title. This was of course outside the Molony Committee's terms of reference, and the Law Commissions, although agreed that there was a need to protect certain purchasers of goods buying otherwise than for private use and consumption, were equally divided as to how this should be done. Some considered that it would be sufficient to define "consumer sale" widely enough to include sales to those business buyers who seldom buy the goods in question and therefore may be no better able to judge quality than a private consumer. An example of this might arise in a sale of farm machinery to a small farmer. This solution would still allow exclusion clauses in the great majority of business contracts. The trouble is that, with exclusion clauses barred in consumer sales, the proposal could have the effect of leaving retailers to bear an
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intolerably heavy burden. They would be unable to exclude their liability to their own customers in the terms implied in Sections 12 to 15 of the Sale of Goods Act and they would also be unable to pass that liability back to the wholesaler or manufacturer if their contracts with their suppliers contained an exclusion clause. After wide consultation, we have concluded that this burden should not fall wholly on them.
Since the Commissions reported, we have been considering other ways of dealing with this problem and have consulted further with the various commercial and consumer interests concerned. We have come to the conclusion that the best course would be to adopt the proposal of the other half of the Law Commissioners that exclusion clauses in business sales should be allowed but should be subject to a test of reasonableness. Despite their difference of view on this issue, the Law Commissions were unanimous in their view that if there were to be any general control on business sales it should take the form of a reasonableness test. The Bill therefore provides that any clause excluding the implied terms of Sections 13 to 15 in non-consumer sales shall not be enforceable if the buyer can show that it would not be fair and reasonable to allow reliance on the exclusion. Such a provision seems to strike the most equitable balance between preventing the imposition of onerous conditions by strong sellers on weak buyers in business sales while preserving the freedom of the strong to deal with each other on whatever terms they choose.
The Law Commissions agreed that if exclusion clauses in business sales were to be subject to a test of reasonableness, the degree of uncertainty in such a test could be reduced if the courts were to apply certain guiding principles; and they set out a number of such principles—seven, I think—in their Report to which they envisaged the courts would have regard in considering individual cases. While we agree entirely with the Commissions that guide-lines should be provided, we believe it would be better for guide-lines to be set out in the Bill itself. This is done in subsection (6). In our view, those seeking to determine their rights and responsibilities should

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so far as possible be able to do this by reference to the Bill itself. Clause 4(2) of the Bill adds a subsection (6) to Section 55 of the 1893 Act setting out guidelines which we believe take account of those factors which the Law Commissions considered should guide the courts in such cases. No doubt this is something noble Lords will wish to examine in Committee. Clause 5 implements those recommendations of the Law Commissions concerned with the conflict of laws. Subsection (1) of the clause is intended to prevent attempts to get round the provisions of the Sale of Goods Act by making contracts which would normally be subject to United Kingdom law subject to the law of some other country. Subsection (2) stops up another escape route which might be offered by the Uniform Laws on International Sales Act 1967. So far as genuine international sales are concerned, the Law Commissions accepted that it would be undesirable to extend the proposed control to such sales, since to do so could place United Kingdom exporters at a disadvantage compared with their foreign competitors. Clause 6 of the Bill therefore allows exclusion clauses to be used freely in international sales.
Clauses 8 to 15 of the Bill re-enact provisions relating to implied terms in hire-purchase and conditional sale agreements. At present, hirers under hire-purchase agreements and buyers under conditional sale agreements enjoy the protection provided by the Hire-Purchase Act 1965. So far as implied conditions and warranties are concerned, in contrast to the provisions of the 1893 Sale of Goods Act, the parties cannot contract out of them. This means that hire-purchasers and conditional sale buyers are at present better protected than persons who buy for cash. They also get more protection than persons who buy on credit by means of credit sale. But generally this protection is less than would be provided to cash purchasers under this Bill. It seems to us that the only sensible thing to do is to give exactly the same protection so far as exclusion is concerned, no matter whether purchase is being made for cash, credit, conditional sale or hire-purchase.
Another anomaly at present is that hire-purchasers who are bodies corporate
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or hire-purchasers buying an article costing more than £2,000 do not get the protection against exclusion given by the present hire-purchase legislation. Here, too, it seems to us that the same principle should apply: that, so far as implied conditions and warranties are concerned, the same protections should exist in cash sale, credit sale, conditional sale or hire-purchase. Thus, the Bill also corrects this anomaly by giving the same protection to such hire-purchasers as is given to cash purchasers. Similarly it is intended to align so far as possible the warranties to be implied on redemption of trading stamps for goods. The Trading Stamps Act 1964 already implies certain warranties as to title and merchantable quality. But these can be excluded. Clause 16 of the Bill now brings those warranties into line with similar terms to be implied in the sale of goods and bars any attempt to exclude them.
My Lords, complicated as all this may seem, in essence what the Bill proposes to do is very simple: to protect the weak while allowing those who do not need protection to deal with each other on whatever terms they choose. It is common ground that additional protection for the consumer in respect of implied conditions and warranties has long been needed. But we do feel that we ought not to leave the small retailer and the small businessman without any protection, and that some regulation of the use of exclusion clauses in business sales is essential. There are some matters in this Bill which may well give rise to discussion in Committee, especially as the Law Commissions themselves were not fully agreed upon their recommendations about them. But, from the point of view of the consumer particularly, I believe that this Bill will be greatly welcomed as a notable step forward in the legal protection afforded to the consumer. I commend the Bill to your Lordships and I beg to move.
Moved, That the Bill be now read 2a.—(Lord Drumalbyn.)
4.59 p.m.
BARONESS PHILLIPS: My Lords, I should like to thank the noble Lord, Lord Drumalbyn, for introducing this Bill into the House and for his very clear explanation of a matter which could have been

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much more complicated. As the noble Lord has said, the Bill is the first for consumer protection, and I give him an unqualified commendation for being fortunate enough to introduce it into your Lordships' House. I hope that this Bill will be the forerunner of many. I feel that perhaps I should take back my harsh words when I said that the lines in the gracious Speech which related to consumer protection would not be carried out; I am very happy to eat my words.
In the realm of consumer protection, one of the most important Acts on the Statute Book has always been the Sale of Goods Act 1893. In my role as adviser to the consumer this has been literally a bible, and since we still work under the philosophy of caveat emptor we have constantly had to refer back to this Act. As your Lordships know, it makes the shopkeeper liable for the quality of the goods he sells but hitherto has allowed a contracting-out agreement. At present, as we all know, a customer often signs a manufacturer's guarantee which removes his—the customer's—rights under the Sale of Goods Act and may actually offer him less protection than he would have had if he had not signed. As the noble Lord, Lord Drumalbyn, has said, the Molony Committee recommended a change in this; and, of course, consumer organisations and women's organisations have for many years been urging an amendment along these lines. So we were very happy when, in 1966, the Law Commissioners started to study this and recommended in their Final Report that manufacturers' guarantees which did not give proper protection should be banned.
Here I would echo the tribute paid by the noble Lord to the work of the Law Commissioners: I hope that they will be used far more in the future, particularly for drafting Bills of this kind. So far as I can see, this Bill reproduces largely the draft clauses in the Law Commission's Report and is basically a lawyers' Bill. I think this is highlighted by the star-studded list of legal minds who are going to participate in this debate. Like the noble Lord, I felt that perhaps I should not be speaking at all. I would only say that I have studied this subject for many years and on behalf of the consumers I welcome the Bill.
I am glad to know that the discussion on the question of services in relation
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to the exclusion clauses is continuing because it seems to me that this is an area in which the shopper spends a great deal of money; in travel, laundries, removals—a whole host of services. Here we do not want unreasonably to limit the trader's liability to other parties in the contract. Although the Bill goes a long way to get rid of guarantees which restrict buyers' ordinary rights, I think there are some other restrictive clauses that we shall have to think about. I could not quite decide whether the conditions applicable to the retention of deposits were covered.
Then there is the date of delivery; and disclaimers about the responsibility of agents. I was particularly interested in the explanation given by the noble Lord on the clause in connection with business suppliers, because literally within the last few days I have been given a classic case of a small garage owned by probably one of the last garage proprietors giving this kind of service. This is the history of a gearbox which was fitted in a car and which literally fell apart within two months of supply. This small garage has been trying to get either the supplier or the agent to accept responsiblity for this, but in the final resort the small garage proprietor appears to be left with the question of having not only to replace the gearbox but to fit a new one completely free of charge; and through the whole jungle of guarantees and warranties he is unable to find out whose is the responsibility. I would add that the car is under the original twelve months' guarantee. So I am hoping very much that this clause will in some way enable a case of this kind to find a final answer.
I understand that the Working Party of the Law Commission considered the special difficulties in striking out exclusion clauses in service industry contracts. I recognise that there are special difficulties, but I hope that their deliberations will finally bring something to your Lordships' House in the form of further legislation. In general, this Bill appears to be a very fair rendition of the work of the Law Commissioners and it shows progress in consumer protection. It is of course subject to the same defect as all consumer legislation in that the individual consumer must finally use the law. I am one of those who hold the view that some agency should be empowered

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to take up and process individual complaints; that a country-wide pre-shopping and post-shopping advice service must be provided, and that the question of setting up a small claims court must be much more closely investigated. These are general criticisms of consumer advice provision which are by no means met by the appointment of a new Minister for Consumer Affairs, although naturally that is very welcome. Nor indeed is it met by amending existing legislation, excellent as this is. Nevertheless I give this Bill a hearty welcome and I wish it a fair passage through your Lordships' House.
Before I conclude, may I apologise if I do not remain throughout the whole of the discussion. I think this is probably the first time I have had to say this in all the years I have been in your Lordships' House, but I have an opportunity to go to the Tate Gallery, and even my work on behalf of the consumers must, on this occasion, take second place. My Lords, I wish the Bill well.
5.6 p.m.
LORD AIREDALE: My Lords, I too wish the Bill well. If we are searching for the reasons why we now find ourselves frowning upon exemption clauses in contracts of sale we have to realise that, first of all, the law of contract as it applies to the sale of goods grew up at a time when in all cases there was some sort of equality of bargaining power between the buyer and the seller; and secondly, that that happy state of affairs has fairly recently been largely overtaken by events. Within the last 100 years if you wanted to buy, for instance, a carriage, there were coachbuilders in every town and in some of the larger villages, and if your coach-builder sought to impose upon you conditions of sale which you thought were unfair you had no difficulty in finding another coachbuilder. Of course, this was well known, so no coachbuilder would put himself in the foolish position of attempting to impose unfair terms upon his customers. If we take an industry like boat building to-day, I suppose much the same situation obtains. There are no doubt some giants in this industry, but I believe there are many small boatbuilders in the country to-day, and I do not believe that anybody seek-
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ing to buy a small boat would have any difficulty in finding a boatbuildcr to do business with him without in any way seeking to impose unfair terms upon him.
I do not think that the case against exemption clauses can be better stated than it was in the Report of the Molony Committee, to which the Minister paid tribute in his speech. That Report says at paragraph 435:
"The overriding argument in favour of prohibiting ' contracting-out ' is that is enables well-organised commerce consistently to impose unfair terms on the consumer and to deny him what the law means him to have. This benefit is obtained without the consumer knowing how he is being treated. If a particular consumer is alive to the position he will find it difficult, and sometimes impossible, to avoid submitting to the terms of business universally adopted. Because the percipient customer is in a small minority the trades concerned can afford to refuse to modify their usual terms at his behest. He possesses no bargaining power of sufficient weight to compel. This is the essence of the case for intervention in support of the consuming public. We endorse the soundness of the case and accept the need to ban contracting-out'."
In his speech the Minister referred, as did the noble Baroness, Lady Phillips, to bogus guarantees, and I wondered whether in this connection we might not avail ourselves of the recent precedent of the health warnings which are printed on cigarette packets, and require that every guarantee which takes away legal rights might be required to print in bold type at the very top words such as: "This guarantee limits your legal rights". However, I do not suppose we can do that in this Bill.
The Bill is, of course, riddled with technicalities and I find it difficult to make a Second Reading speech without descending into what are a series of Committee points. I wish to raise what one might call a borderline case in the context of being a Committee matter, so I will mention it briefly. There is an attempt in Clause 2 to deal with self-service buying and selling. The Minister, when commenting on this, referred to the element of "no words being spoken" as being one of the elements of a self-service sale. In Clause 2 there is no reference to this element. A self-service sale is defined in Clause 2 as happening when goods
"being exposed for sale … are selected by the buyer."

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There are two elements there. Being exposed for sale is one, but I do not think it helps us very much because in every shop, whether or not it is self-service, goods are exposed for sale. As for the second element, being selected by the buyer, here again we are not helped greatly. Suppose one goes into an ordinary non-self-service, old-fashioned green-grocery shop and says, "I would like a melon, please". The shopkeeper says, "Which one would you like?" and one replies, "I would like that large yellow one on the top of the pile"—that surely satisfies the description "selected by the buyer."
If we mean self-service—and in this clause we do—why do not we say "self-service", which seems a perfectly respectable, sensible and well recognised expression? I of course agree that the Statutes should be hesitant to pick up new expressions whenever they arise. Some new expressions are here to-day and gone tomorrow, like the top twenty tunes. I imagine, however, that "self-service" is an expression which has come to stay. As the Statutes pride themselves on calling a spade a spade, could not we in this Bill call self-service "self-service?" I appreciate that even this is perhaps a Committee point. I shall not, therefore, descend further into making a string of Committee points. With a few minor Amendments, which I hope we shall be able to introduce in Committee, I warmly support the Bill.
5.13 p.m.
LORD GARDINER: My Lords, I greatly welcome this Bill. It is really an example of the law having to be altered because of changing economic conditions. As the noble Lord, Lord Airedale, indicated, our law used to say, "We must uphold freedom of contract. It is a free country. Nobody who does not want to do so is obliged to enter into a contract or agree to any terms other than those to which he chooses to agree." No doubt at one time that was so and if one took a lease on a house, the landlord having proposed a draft lease, one's solicitor went through it, perhaps made a few suggested amendments in red ink, sent it back, the landlord then sought to compromise in green ink and the lessee's solicitor said, "If you agree to this one
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further change, in yellow ink, we are ad idem." I think that the next colour to be used was purple. Nowadays, if one wants to take a house on a housing estate the owner of the estate says," I do not make any changes in my standard lease. This is my standard lease and I am sticking to it. If you want a house you must accept it. "It is no good saying to the Gas Board," I like your gas, but I do not like your standard terms of contract "because the Board will simply reply, "Sorry, chum, these are the only terms on which our gas is supplied."
Then there were the so-called guarantees imposed by the big man on the small man, the main object of which was simply to include the little clause at the end which said, This warranty is given in substitution for any warranty whether by Statute or otherwise ", and which simply took away the legal rights which the consumer would otherwise have had. While all this is an old problem, the right solution was never certain with, for example, proposals that there should be a public board which should go through any monopoly which had stiff terms of contract, as had been done with the railways.
We are grateful to both Law Commissions for this Report. It is one which I think must take the price for the degree of consultation. We are of course used to the Law Commission being much more fully consultative of all the interests involved than are either the Lord Chancellor's Law Reform Committee or the Home Secretary's Criminal Law Revision Committee. Here they really seem to have excelled themselves because they started off by appointing a Working Party which I see included five Commissioners from both England and Scotland, four representatives of the Board of Trade, one from the Scottish Office, one from the Treasury Procurement Policy Committee, two from the Bar Council, one from the Faculty of Advocates, two from the Law Society, one from the Association of British Chambers of Commerce, The Law Society of Scotland, the C.B.I., and three from the Consumer Council.
They sat and received evidence from all sorts of interested bodies, and it was only when all that evidence had been received and considered that the Law Commissioners got out their usual working paper, again with their provisional

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proposals, and these were circulated to the innumerable bodies and individuals specified in Appendix C. We are therefore grateful to them for all that. There is only one point I wish to raise in this context. As the noble Lord, Lord Drumalbyn, so lucidly explained to us, among the central proposals it is said that if there are these objectionable exclusion clauses in consumer sales—the ordinary person buying something for his own use—they should be declared void, but in the case of non-consumer sales, concerning traders, one of whom may be very big and the other very small, while they should not be void a judge should be able to say, "In all the circumstances of this case it would not be reasonable or fair that the big man should be able to rely on this term."
The point I wish to raise is about the criteria or, as the noble Lord, Lord Drumalbyn, called them, the guidelines. The Report is quite clear about this in paragraph 113, where it points out:
"… the courts would have regard in applying the test to any of the following elements of or surrounding the transaction, in so far as they are relevant in the instant case:

(a) the bargaining position of the buyer, relative to the seller and to other sources of supply at the time of the contract;

(b) whether the provision excluding or limiting liability is clear in its wording and scope of operation;

(c) whether the steps taken to bring the provision to the attention of the buyer were reasonable in all the circumstances, including any customs of the trade and any previous course of dealing;

(d) whether the buyer was offered and accepted a material benefit in consideration of agreeing to the provision;

(e) where the provision excludes or restricts liability unless certain conditions are complied with (for example, claiming within a prescribed time), whether it was, in the events that have occurred, reasonably practicable to comply with those conditions;

(f) whether the goods are manufactured, processed or adapted to the special order of the buyer;

(g) the ultimate incidence of risk and liability arising by reason of defects in the goods.

Your Lordships may think that those are seven very sensible criteria for the judges to take into account. I was at first rather puzzled by the fact that although there are draft clauses attached to the Report, these criteria were not set out in the draft clause. Then I discovered from a footnote to that paragraph that the reason appears to be that there is a draft
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clause attached to the Report in Clause 8(4), which states:
"In ascertaining the meaning of any enactment as amended by this Act regard may be had to a report of the Law Commission and the Scottish Law Commission recommending that that enactment be amended.
In effect, the judges will be able to read the Report where they will see these things set out. This subsection the Government have not accepted and I think I understand why. I am afraid that I have said several times in this House that it is absolutely ridiculous that when an Act of Parliament is passed arising out of the Report of a Royal Commission, the Law Commission, or a departmental committee, the judges, when construing the Act, cannot look at it. That they cannot examine and see what the Report says is the mischief to be cured, or what the proposals are based on, or why they chose this form of words rather than that form of words, has always seemed to me to be an absolute nonsense. Of course the judges, or certainly some of them, do read the Reports in their private rooms; indeed, I have seen them sometimes having them on the bench in front of them, but they are not allowed to admit it. As I say, I think that is nonsense.
Some of your Lordships may remember that in a recent Bill in the lifetime of the last Government, the noble and learned Lord, Lord Wilberforce, moved a clause to this effect, that "judges in construing this Act can look at the Report on which it was based." Your Lordships accepted that, but in the other place this ran into great trouble and it was said to be a monstrous interference with the supremacy of Parliament—or something of that sort—and in view of the opinions expressed I can well understand the Government not putting that draft clause into the Bill.
If they are not going to do that, and the judges cannot look at the Report, then I should have thought that these seven criteria should be in the Bill. What in fact has happened is not that the Bill leaves the matter entirely to the judges without any guidelines at all, but for some reason which I have not followed—and it may be my mistake which no doubt the noble and learned Lord the Lord Chancellor will explain when he comes to reply—what they seem to have done is to have picked out two of the seven

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criteria mentioned in the Report, reworded them (though not I think advantageously) and then ignored the others. I quite agree that as drafted in the Bill the only two things they refer to here in Clause 4(6) are:
"(a) whether the buyer knew or ought reasonably to have known of the extent of the term;"
and—
"(b) whether in buying goods of the description in question the buyer was able to choose whether to buy the goods (from the seller or any other person) under a contract without that term or with a term less unfavourable to himself."
But they do not prevent a judge from taking something else into account because the opening words of the subsection are:
"In determining for the purposes of subsection (5) above whether or not reliance on any such term would be fair or reasonable regard shall be had to all the circumstances of the case and in particular to the following matters—"
then these two are mentioned.
It may well be said that it only says "in particular to the following matters" and that will not prevent a judge from looking at something else. But I am apprehensive that if judges are told "these are really the two things to which you ought to pay attention" then they will think that if they have paid attention to those two things they will have done their job. Some of the other five criteria I should have thought were so obviously desirable as matters to be taken into account. One to which I have referred is that if there is, for example, a time provision and you have to put in a claim within a certain period, if the big man is to rely on this condition is it not proper for a judge to say that it would not be fair or reasonable because the small man was in hospital having had an accident and he could not fill up the form in time. What is the objection, therefore, to putting the seven criteria, as they appear in the Joint Report, into the Bill? I should have thought that was what was really required. I personally would sooner have no criteria at all than have the two emasculated ones which at present appear in the Bill.
That is the only point I wish to raise. I very much welcome the Bill. I hope that we give it a Second Reading, and that it will soon become part of our law.
5.25 p.m.
LORD DENNING: My Lords, this has been said to be a lawyer's Bill. Maybe it is. But it affects, I should have thought, more than half of the contracts that all the people in this country make every day throughout the year: contracts of sale; contracts of conditional sale; and contracts of hire purchase. It has been my lot at the Bar and on the Bench to have to consider the operation of these exemption clauses, of the small print and of how we can get out of them. This Bill, to my mind, effects a most important revolutionary reform in the law of contract.
In 1893 there was a codifying Statute, the Sale of Goods Act 1893, which simply built on all the hundreds of precedents over hundreds of years and put them in the form of a code. It did not attempt to reform the law. The old Roman law said caveat emptor—the buyer takes his chance. The common lawyers and the Act in 1893 qualified that and said, "If the seller sells and does not exclude his liability, he warrants; he agrees that the goods are reasonably fit for the purpose for which they are sold and are merchantable". There was the qualification permitted by the common law—the seller could exclude his liability. Cases have shown that, however unreasonable it was, however small the print and however unequal the bargaining power, the seller could exempt himself from liability. May I tell your Lorships—because it was a case in which I was concerned and it is a leading case now—that in 1934, when I was at the Bar, there was the case of L'Estrange v. Graucob. It is almost a high watermark of the law as it has been.
It was a case where a lady who kept a small shop in North Wales was approached by a salesman who sold to her an automatic cigarette machine. The cost was payable by instalments. He produced to her a long brown form, with the small print at the bottom, and asked her to "sign here": and she did. The machine was delivered. It would not work, and she told them so. They sent an attendant three times, but he could not make it work, so she said, "I am not paying any more of those instalments". The company took her to the county court. When she said that the machine did not work, they said, "Look at the

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form". If she had read the form she would have seen the words:
"Any condition or warranty express or implied by statute or by common law is hereby excluded."
The county court judge tried to get around it, but found in favour of the company. I was at the Bar and appeared for the company in the Court of Appeal. In those days I was not concerned with whether it was right or wrong; I was concerned to win the case if I could. I said, "Well, she signed it. In the absence of fraud or misrepresentation she is bound". And the Court of Appeal said, "Yes, she is bound". So we won that case, most unrighteously. The lady had to pay for the machine which would not work. The reporters did not report the case at once; perhaps they did not like it. But my company were cleverer; they got the report privately printed, and I went round the county courts of England, as a junior member of the Bar, winning case after case, most unrighteously, for that company.
It was a little different when I got on to the Bench; I viewed things a little differently then. Leading up to that, I remember one occasion when we went to Northern Ireland with the car. Corning back we were given a sailing ticket which I was told to sign. I signed, and on looking at it I saw on the back in small print that the company would not be liable for any acts neglect or default or wilful misconduct by anyone whatsoever. They could have thrown the car into the sea and done what they liked. Then we had a case in the Court of Appeal. A man had bought a car on hire purchase and it was to be delivered to him the next morning. It was delivered very early in the morning without his knowing it and was left outside. When he tried to start it, it would not go. They had to tow it away. When they sued him for the instalments he said: "But it will not work; it will not go". They said: "Look at the clause; there is no implied condition or warranty as to roadworthiness or anything whatsoever".
At that time in the Court of Appeal we managed to raise a doctrine which is called fundamental breach; if the supplier was guilty of a breach which went to the root of the contract he could not rely on these exempting terms. We managed quite well for fifteen or
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twenty years; the Court applied the doctrine that the man could not rely on exemption clauses if guilty of a fundamental breach. But I regret to say that we were later told by your Lordships' House sitting judicially that we were all wrong and that there was no such doctrine in our English law; there was no such doctrine as this fundamental breach; you had to look at the clause to see what it meant. We did our best with that. Time after time we have construed these exemption clauses, as we think strictly, saying that a man is not to get out of his liability unless he expresses it in plain words. We could not always do that. If a man said that he would not be liable for any loss or damage we could deal with it; we could say that it did not exclude his own negligence. But if he put the words, "any loss or damage howsoever caused", we could not get round that. So, making one effort after another, we in the courts have tried to mitigate the evil of these exemption clauses.
Equally with guarantees. Your Lordships will know what these people used to do. If you bought a machine or a motorcar from a dealer, there would be a great red seal with a guarantee, and if you read it you found it said, "We will replace any part found to be defective within 12 months, but otherwise we exclude any condition or warranty expressed or implied by contract or by statute or common law or any wise howsoever". In other words, they sheared it down to practically nothing by calling it a guarantee. We have done what we can to remedy that in the courts, but we have not succeeded.
This Bill applies to sale of goods, hire purchase and the like. It does what the courts could not do but what your Lordships' House can do. It says in regard to consumer sales—that is, sales to the little man who is not protected, who buys or takes on hire purchase, perhaps, a motor bike or something else—that where the supplier puts in such exemption clauses those exemption clauses are void. There is no doubt about it. So the consumer is and will be protected in consumer sales. But then there is the other big branch of what might be called business sales, not consumer sales; for instance, that little case I told you about of the lady in North Wales. She was a

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shopkeeper. That would not be a consumer sale, as I read the definition, but a business sale as between business people, business houses. Often one is in a stronger position than the other. We have seen what some businesses do. You receive a letter with the conditions set out on the back—a whole lot of printed conditions that no-one ever reads—or on a ticket incorporating this, that or the other. In regard to these business sales this Statute—this Bill, as it is now—makes a most important reform which we have never recognised hitherto. The judges, the courts, can consider whether the conditions are reasonable or not, or, rather whether it is reasonable for the seller to be allowed to rely upon them. If it is unreasonable, the courts can disentitle the seller, or whoever it may be, from reliance on that clause.
This principle of reasonableness has never been accepted hitherto. There are vast bodies of opinion which say that it goes against certainty; that you ought to allow people to be certain, to read the words and know what they say. But it now gives the judges the power to shut out the plaintiff if he is unreasonable, and it is, as I suggest, one of the most important reforms in the law. I entirely agree with my noble and learned friend Lord Gardiner that the Law Commission have set out the most valuable seven criteria for the courts to adopt in saying whether something is reasonable or not. Whether it is a big man—the great commercial concerns with their commercial contracts and the like—or a small man they can take everything into account to see whether it is reasonable. All guidance that can be given to the courts in that way, I am sure, everyone would welcome.
I would acid this. This does not apply to services, only to sale of goods, hire-purchase and the like. I hope that the time will not be far distant when it can apply to services, like the carriage of goods, where you find all the printed clauses at the back, or to the laundry to be washed, or the like. If, as the next step, the courts can be allowed to consider the reasonableness of those clauses—whether it is reasonable to apply them—that, I venture to think, will be the next important step in the whole of our civil law and the law of contract. But, speaking for myself, I repeat that,
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in my judgment this is the most important reform in our commercial law which has been seen in my time.
5.38 p.m.
LORD LLOYD OF HAMPSTEAD: My Lords, this is a law reform Bill in an unspectacular area, and a relatively non-controversial one; but, as the noble and learned Lord, Lord Denning, has pointed out, it is none the less one of very great importance. It illustrates in a striking way the tremendous contribution that can be made and is being made to the reform of our law by the two Law Commissions. Indeed, one feels constrained on this occasion, when happily the noble and learned Lord, Lord Gardiner, felt able to make a contribution to this debate, to say once again, as has been said often in this House, how great a debt we owe to him personally as the creator of this invaluable institution. It may be said, possibly, in some criticism of the Bill, that it is a rather unhappy example of the piecemeal way in which our legislation is reformed; and of course what one would like to see ultimately is some kind of consumer law code. On the other hand, I think we shall all agree that Parliamentary time is a very scarce commodity, and that we should seize every opportunity we can to drive forward with these specific proposals that the Law Commissions put before us.
Your Lordships have heard contributions from a number of very eminent lawyers in this House, and towards the I end of this debate there is little that remains for me to say. But I should like to refer to the exclusion clause aspect of this Bill. The noble and learned Lord, Lord Denning, has described to us in his characteristically graphic fashion the struggles that the courts themselves have made to make some sense of our law, based on the principle of caveat emptor—let the buyer beware! Indeed, one may, with respect, pay a tribute to the noble and learned Lord, Lord Denning, himself as being one of the judges who has striven most strenuously to do the maximum degree of justice in this class of case. But, as even he admits, at the end of the day, the Judiciary have rather been defeated by the fundamental in-built principle, so incompatible with the present social and economic situation, of freedom of contract—this idea of

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notional equality of bargaining. Therefore, when even the skill and erudition of such a judge as the noble and learned Lord, Lord Denning, is defeated in this respect, one must recognise that legislation is the only way in which something can be done about it.
The procedure adopted by the Law Commission in this matter, so well brought out in the speech of my noble and learned friend Lord Gardiner, of putting out a working paper first, having the fullest possible consultation and then producing a fully reasoned Final Report, obviously points to the most satisfactory way of producing adequate reform in a field such as this. Speaking for myself—and this view seems to be shared by others who have spoken—I feel that the Government have shown wisdom in choosing the opinion of those Commissioners who suggested that there should be some measure of control in regard to non-consumer sales. It is interesting to note that the Commissions were almost equally divided on this matter: in fact the situation was that it was virtually the English Commission against the Scottish Commission, with the exception of one English Commissioner who took the side of the Scottish Commission. I am not revealing any secrets in saying this, because of course it appears in a footnote in the Report itself. Though so frequently, when one is concerned with law reform, speaking as a mere English lawyer, one is forced to the conclusion that the Scottish law has on the whole taken the more rational course, on this occasion I am bound to say that I am glad that the Government have chosen the solution substantially put forward by the English Commission, and expressed an opinion which was shared by the distinguished Chairman of the English Commission himself, Sir Leslie Scarman.
It can be said—and this was one of the arguments adduced against this solution—that if the idea of reasonableness is introduced as a test this introduces a major clement of uncertainty in the law, and will impose great difficulty on the judges, and so forth. I think—and here again one can pray in aid the invaluable view of the noble and learned Lord, Lord Denning—that this point has been very much exaggerated. Our judges are extremely accustomed to dealing with the
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concept of reasonableness, and in fact Parliament has not infrequently expressly given them this power. For example, under the Rent Restrictions Acts, they have the task of deciding whether or not it is reasonable to make an order for possession.
I do not think it can seriously be suggested that in this sort of case there is so great a measure of uncertainty that one can say that the law is rendered unsatisfactory. I can see that there is an arguable case for saying that one ought to treat consumer sales and non-consumer sales in the same way, and thereby render the law more simple. On the other hand, this can lead to complications such as were pointed out very lucidly by the noble Lord who introduced the Bill, Lord Drumalbyn, when he pointed out some of the difficulties to which this might lead. On the whole, one would accept that a very sensible solution has been proposed to this difficult problem, and one is gratified to see that the Government have grasped this early opportunity of adopting it.
I would only wish to add, as a final word in welcoming this Bill, and recognising that there are compelling reasons why a piecemeal approach should be adopted, that I hope we may look forward to a number of further important instalments in the field of consumer law, particularly now that we have the benefit of a Minister in the Cabinet specifically charged with this function. I should like to take this opportunity of welcoming this development, and particularly the appointment to it of Sir Geoffrey Howe who, of course, has very considerable credentials in the field of law reform. His connection with Justice and such bodies over a long period sufficiently testifies to his law reforming spirit. One may indeed hope that we shall have a series of important measures of this kind. Perhaps the next one will arise out of the Final Report of the Law Commissions, to which we are very much looking forward, on the whole field of exemption clauses in relation to negligence, and (the point that was referred to by several previous speakers) exemption clauses in regard to service and other contracts. We have seen the working paper which the Law Commissions have produced—a very interesting and valuable document—and we can now look forward to their Final

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Report and, we hope, very early legislation. In welcoming this legislation, I should like again to reiterate the hope that it will be only the beginning of a spate of similar and equally significant legislation in this vital field.
5.49 p.m.
LORD JANNER: My Lords, this Bill deserves the very warm welcome which it has received this afternoon, and the Minister is to be congratulated on bringing it forward so early in this Session of Parliament. I would also congratulate him on the very succinct and effective way in which he introduced the Bill this afternoon. We were promised a Bill for last Session, and some of us had begun to wonder whether we were ever going to see it. But here it is at last, and when it comes into force millions of people in all parts of this country will be protected from getting faulty goods in a way which does not happen at present.
We have heard, and quite rightly, that ten years have elapsed since the Molony Committee made a full-blooded recommendation to ban exclusion clauses in contracts for the sale of goods. Ten years is a long time to have to wait for the implementation of a recommendation which hardly anyone has spoken against, and which all right thinking people support. It was only when the Law Commission reinforced the Molony Report's recommendation by their Report of July, 1969, that there were any signs of action in this matter. The Law Commission's Report is in my view—and, I think, that of everybody else—an excellent and painstaking document which demonstrates overwhelmingly what a sensible and skilled body it is. It makes one wonder how our legal system managed for centuries without a Law Commission. I should also like to offer my thanks and congratulations, on behalf of the community as a whole, to the noble and learned Lord, Lord Gardiner, for having been instrumental in setting this Commission on foot.
The evils of the exclusion clause are well known to those people who have anything to do with consumer affairs, but are unknown to the great mass of people who are affected by them. They come in all sorts of ways, and this Bill seeks to deal with them in only one area; namely,
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sales of goods. We shall have to wait longer—although I hope not for another ten years—to see a ban on exclusion clauses in other contracts. The introduction in this House of a Bill of this nature indicates that the House can serve a very useful purpose when the other place is so heavily overladen with work, where the excuse is so often made—as when leave was given only a year ago for a Bill to be introduced by Greville Janner—that time could not be found for its Second Reading.
I have in mind, in particular, matters such as car parks and holiday brochures, It is sad to find a public corporation—such as the London Transport Executive—indulging in this particular abuse. If one of your Lordships were to park your car at any one of a huge number of London Transport Underground stations—as one might well do out of a public-spirited intention to contribute towards the relief of traffic congestion in central London—you would find that a very distasteful exclusion clause would protect London Transport from almost any calamity which might befall you or your car while in that car park. May I quote the wording of the exclusion clause to which I have referred? It states:
"The motor vehicle whilst upon the premises of the Executive shall be at the entire risk of the owner, and the Executive accept no responsibility in respect of loss or mis-delivery of or damage to motor vehicles, the contents thereof, or accessories thereto, or in respect of any injury to the occupants howsoever or by whomsoever caused or whether occasioned by negligence or otherwise. The Executive do not undertake to supervise vehicles left in the car park."
I regard that as a shocking notice for anyone to publish, and it is quite intolerable when it comes from a public body such as the London Transport Executive.
May I remind your Lordships that Parliament itself, even in very recent years, has blessed the principle of exclusion of responsibility? Section 29 of the Post Office Act 1969 almost entirely frees the Post Office from liability in whatever it does. Thus, if through gross negligence someone's name is left out of a telephone directory, or letters are mis-delivered, the Post Office is not responsible to the citizens for its negligence, even in a way that any respectable business organisation would be in similar circumstances. Owing to a statutory

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immunity which we have permitted to creep on to the Statute Book, the Post Office enjoys the benefit of what is, to all intents and purposes, an exclusion clause. The Bill at present does not apply to any of these services. It deals only, as we know, with exclusion clauses in contracts for the sale of goods. Nevertheless, it is a great advance and will have a good deal to contribute towards better consumer protection in this country.
The clauses of the Bill have been fully explained from both sides of the House. I would, however, refer to important features of some of them. The provision in Clause 2, that a sale of goods shall not be prevented from being a sale by description by reason only that the goods are selected by the buyer when they are exposed for sale and hire, is important. Thus, when a housewife visits a supermarket and selects those articles which she wants, she will not thereby be deprived of the protection given to those who buy goods "by description". Such a purchase will clearly be a "sale by description" after the Bill is passed. The new description of "merchantable quality" in Clause 7(2) is one of the important provisions, as it provides, in effect, that purchases should be free from faults; and Clause 3, which gives to customers the protection that their purchases should be fit for their intended purposes, is a very valuable one.
I regard subsection (4) of Clause 4 as by far the most important provision in this Bill. This introduces for the first time a complete ban on contracting out of the legal protection given to the buyer on a purchase of goods. In the case of a "consumer sale", as defined in Clause 4(8), it will be impossible for the seller of goods craftily to rob the consumer of the protection which the law intends him to have. This will mean that the miserable small print which has been referred to, inserted by some manufacturers and retailers, will no longer be effective. The worst offenders in this field have been the motor trade. This is hardly surprising when one considers that the motor trade also holds pride of place—if that is what one can call it—as the segment of trade whose members have most frequently been
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convicted of offences under the Trade Descriptions Act.
For many years, it was the invariable practice in that trade to require the buyer of a car to sign an order form which effectively took away his Sale of Goods Act rights and provided, as a substitute, the more feeble rights provided by the manufacturers so-called guarantee or warranty. In 1962, the Molony Report stated that at that time the practice of contracting out was "universal" in the motor trade. Things have improved since then. There are some manufacturers who do not insist on their agents and dealers using order forms which take away buyers' rights wholesale. Many garages, however, still do, especially those which belong to the Motor Agents' Association, which promulgates an order form designed to cut down the rights of a purchaser to the bare minimum. It reads thus:
"The seller undertakes that he will ensure that the pre-delivery work specified by the manufacturer or concessionaire is performed and that he will use his best endeavours to obtain for the purchaser from the manufacturer or concessionaire the benefit of any warranty or guarantee given by him to the seller or to the purchaser in respect of the goods and such undertakings are given and accepted instead of and expressly exclude any other guarantee or condition or warranty as to quality or fitness for any purpose."
The position about guarantees, of course, is very confused. Obviously they have some value to the consumer, and most people regard them as being a valuable means of getting faults in purchases put right speedily. No doubt sometimes they are. The trouble is that most people think that the guarantee is the only source of protection. This is quite wrong. It is the buyer's contract of purchase which gives, or should give, the major protection from the legal point of view. The guarantee has tended to obscure that important fact. When this Bill becomes law, the buyer will have those rights against the seller in any event. No small print or device by sharp operators in commerce or industry will succeed in taking away those rights. It is therefore of great importance that these new inalienable rights of the consumer should become very widely known. Those of us who have been in either this House or the other place for a number of years realise that it is not only important to have Acts passed; we must also see to

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it that the general community know what they are all about. I hope that the new Minister for Trade and Consumer Affairs will regard it as part of his responsibility to publicise by every possible means this new protection when it comes into force, because it will not be of much use if people are not aware of its existence.
A massive programme of advertising and education will be needed to get it across to consumers everywhere that in future they are entitled to look to the shop which sold them a product for the correction of any faults. This will remain an important question because we may expect guarantees to soldier on, even when this Bill gives assured protection vis-à-vis the seller. Manufacturers find that issuing guarantees helps business, and so long as that remains the case we may expect to find them floating around. They help consumers, too, but only as a second string. If guarantees are still going to be around for many years to come, it will be particularly important to get over to people the idea of looking to the seller in future for putting right things that have gone wrong.
Apart from cars, people do not often have to sign an order form when they buy something new in a shop. Legally, therefore, it does not often happen that tinder the present system, a buyer's rights get extinguished because as a rule a guarantee from a manufacturer cannot achieve that. It is only a contract with the seller which can have any effect on the buyer's rights against the seller. All the same, one finds cases where guarantees purport to take away rights. Fox example, in the radio, television and hi-fi industry, guarantees have almost invariably put upon the consumer the obligation to pay for labour charges in connection with putting right faults under the guarantee.
For instance, even the Philips organisation, which is a very important organisation, say in their guarantee:
"The costs of labour, packing and carriage are not covered by the Guarantee."
This, of course, is quite unjust. Why should one pay for the labour involved in putting right a fault in a new radio or record player which has just been bought? The labour charges are likely to be very much more than the cost of the faulty part, which is all that the
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guarantee will cover; and, of course, that is quite wrong. Legally, in spite of this clause in the Philips guarantee, the buyer, in my view, has the right to claim from the shop for the labour charges; but in practice this does not happen because of what the guarantee says. The public is bamboozled by the wording of the guarantee into thinking that it does not have redress, when in law it does. So that is another reason why it is essential that a big educating programme should be undertaken to inform the public about the true legal situation when they buy things in shops.
There are other occasions when a purchaser is requested to sign an order form. This can arise in respect of mail orders, and so on. A company called Gemini Engineering, for instance, produce what may be, for all I know, a very good shower unit for installation in people's homes; and they advertise widely in selling their shower units. This company use an exclusion clause which reads as follows:
"All the terms of this Agreement between the Company and the Purchaser are contained in this document and no statement, representation or description, whether made by the Company or its servants or agents on its behalf,"—
it is amazing what some of these people say about these matters—
"whether written or oral, or contained in an advertising literature or other matter issued by or on behalf of the Company, shall form part of this Agreement, or have any effect thereon, or be deemed to be a representation, warranty or condition inducing or forming part thereof".
There is one item I should like to see added to the Bill in Committee which in my view would clear up a somewhat doubtful point of law. It arises in this way. Often, when a member of the public has bought something in a shop and it goes wrong, he or she takes it back to the shop where it was bought and the shop, very properly, replaces it with another article of the same kind. The question is this: is that second article protected legally in the same way as the first? It may well not be. I do not know whether I am mistaken in this; but, of course, we have very eminent legal authorities here who may help. It is argued that it was not, after all, acquired by a sale of goods but by what is in reality an exchange of goods—the exchange of the faulty article for the replacement. As

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I read the Sale of Goods Act 1893, the legal protection for the buyer operates only where there has been a sale of goods, as in the case of the faulty article; that is, to use the words in the Act, where it is acquired through an agreement "at a price". There is no price for the second article, only for the first. Some lawyers argue in various ways that this cannot be a correct view of the law; but there must be, and there obviously is, some doubt. I should like to see an Amendment brought forward when this Bill is in Committee to make sure that a replacement article or substitute is equally covered. Perhaps the Minister would look into that point.
Now the most dramatic effect in practical terms which this Bill will have will be to give the buyer a right to compensation as well as a right to have faults put right. It will arise in this way. If I buy a new car and within a short time it breaks down, I shall be able to take the car back to the garage where I bought it and insist that they put the fault right free of charge. In addition, when this Bill becomes law I shall also be able to insist that the garage provides me with transport for the period during which my car is being repaired. This is how I read it: they must pay for the cost of hiring another car to see me through the time during which I am deprived of the use of my own car. This will make a tremendous difference in practice. For thousands of buyers the greatest bugbear of the existing situation has been the deprivation of the use of the article for the period when it is being repaired. The guarantee has never covered that additional expense, and the result has been that most people have either struggled through without their cars for however long it takes to get the car put right, or, alternatively, have paid out of their own pockets for the hire of another car. This situation will change, and I think it will have a profound effect on the motor trade.
But perhaps the greatest effect of all will be that, in the long run, quality control in the factories will improve. If those responsible for manufacturing and selling goods throughout the country know that there is now a come-back for the consumer, come what may, and that they will have to foot the bill for putting faults right and, in my view, for hiring
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another article, as I indicated a moment ago, they will probably come to realise in the fullness of time that the cheapest thing to do is to take better care to see that fewer faults are there in the first place. This could well be the most significant result of this excellent Bill: and, if it is, we shall all benefit enormously from that result. I congratulate the Minister once more, and I hope that he will take into account what has been said with regard to other abuses and get this Bill on to the Statute Book as speedily as possible. Your Lordships should tell the Government that we are prepared to do the donkey work and get through the first stages of any Bill if it is introduced into this House first, and then the other place will not have so much trouble with it when it gets there.
6.9 p.m.
THE LORD CHANCELLOR (LORD HAILSHAM OF SAINT MARYLLBONE): My Lords, I see that my name is down to wind up this debate. I think it may be generally considered (to parody Sir Winston Churchill) that noble Lords have left me comparatively little "up with which to wind". However, a certain number of points emerge. The Bill has, I think it is fair to say, received a general welcome—a welcome which is not the less warm because it has been introduced early in the Session into your Lordships' House rather than in another place. I certainly agree with the last speaker when he said that this process results not merely in saving us some of the agonies of the last Session resulting from the piling of work on to us in July, when another place has processed it, but also enables a general saving of Parliamentary time to take place because we can iron out some of the weaknesses in proposed legislation and thus shorten the labours of the other place as well.
The Bill's scope extends to conditional sales, self-service sales, contracts by way of hire purchase and contracts in which savings stamps are exchanged for goods; which, I suppose, is strictly not sales of goods. No one has criticised any of these extensions of scope and I fancy that they will be generally welcome. The proposed Amendments to Sections 12 to 15 of the Sale of Goods Act have also I think escaped much attention because they are generally welcome.

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The debate has very largely revolved around exclusion clauses, whether or not these are of the type which are generally included in the Bill. These are not really—as I think some perhaps unguarded expressions from noble Lords would lead one to suppose—examples of the principle of caveat emptor. They are, on the contrary, examples of the principle that contract is free; and noble Lords have been disposed to say, and I agree with them, that changes in the relative bargaining power of the parties and, in particular, the power of what I might call "the small print", have combined to effect a certain amount of injustice. The noble and learned Lord, the Master of the Rolls, gave us a graphic and racy account of his misdemeanours both at the Bar and on the Bench; and I am not entirely sure that he was very fair to the law. I believe that one can, in fact, destroy some of these exemption clauses by a close attention to the nature of the defect which is discovered in the service or the goods.
Ever since the noble and learned Lord, Lord Devlin, made a very valuable dictum in the Firestone case to the effect that it is illusory to say we promise to do a thing but are not liable if we do not do it, I think that ingenious members of the Bar have been able to destroy a great number of these clauses. However, I am very glad to know that the Master of the Rolls says—and I agree with him—that it is high time that legislation took place to limit the possibility of these clauses in relation to sale of goods—and, as several noble Lords have pointed out, in the pipeline from the Law Commission there is promise of legislation ultimately covering exclusion clauses in contracts not covered by this particular Bill.
I do not share altogether the implied criticism of the noble and learned Lord, Lord Gardiner, of other agencies of law reform, whether they be the Law Reform Committee or the Criminal Law Revision Committee or special committees like those dealing with contempt and libel which have been found necessary from time to time. Both Law Commissions necessarily are relatively small bodies and they would lose some of their distinction if they were not. There is plenty of law reform which has to take place through other agencies. I do not regard these
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bodies as poaching on each other's preserves; I regard them, on the other hand, as allies in a worthy cause.
The noble and learned Lord, Lord Gardiner, entered upon an interesting topic which he introduced by way of referring to the guidelines in paragraph 113 of the Law Commission's Report which he contrasted with the rather simpler guidelines contained in the Bill. I am not sure myself that he did it entirely for its own sake; because he was at pains to introduce to the House his view which was on another occasion shared by the noble and learned Lord, Lord Wilberforce, that courts ought to construe Acts of Parliament by reference to the Blue Books which preceded them. I venture to say to the noble and learned Lord that in one respect at least I have the advantage both of him and of the noble and learned Lord, Lord Wilberforce, in that I was for a great number of years in the House of Commons. I very much doubt myself whether, if he and the noble and learned Lord, Lord Wilberforce, had shared that experience they would be quite so confident that the intentions of Parliament as defined by an Act of Parliament which has gone through the process of Committee in another place can effectively be construed, even if one takes a commonsensical view of the matter and not a technical view of the matter, by reference to the Blue Book which preceded them. I think that that could be most misleading. and I think the other place were perfectly right in showing a certain amount of caution about the noble and learned Lord's well-known doctrine in that respect. Of course, lawyers and judges read Blue Books which have relation to Acts of Parliament which ultimately emerge. The noble and learned Lord, the Master of the Rolls, has more than once used a Blue Book to illustrate the purpose, the underlying mischief as it is called, of a particular Act of Parliament. But to construe particular clauses by reference to the preceding Commission or Committee Report is, I think, a dangerous undertaking and I am glad that on the whole the courts are not able to do it.
The noble and learned Lord did, however, contrast the actual guidelines in the Bill with the actual guidelines in the Law Commission Report. Part of the differ-

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ence must necessarily reside in the fact that whereas the Commission put its guidelines in the Report for reference but not as a matter of strict construction of an Act of Parliament (they did not design it to form part of an Act of Parliament) we have decided, as my noble friend Lord Drumalbyn explained in opening, to translate what was intended as a piece of text book guidance into the actual terms of the Act. Part, at any rate, of the difference between the two sets of guidelines can, I think, be attributed to this fact. Ours are simpler than those suggested by the Law Commission and I think none the less that they may take account of all the important factors.
In the first place, the fairness and reasonableness of an exclusion clause is, under the Bill, to be tested in the light of all the circumstances of the case, just as the Law Commission recommended; but the provisions of the Bill drawing the court's attention to the question
"whether the buyer knew or ought reasonably to have known of the extent of the term"
would we believe, cover the Law Commission's points (b) and (c) on whether the clause was clear in wording and scope and whether reasonable steps were taken to bring the clause to the buyer's attention. The other special point drawn to the attention of the court by the Bill, in contra-distinction to the Report, is
"whether in buying the goods of the description in question the buyer was able to choose whether to buy the goods (from the seller or any other person) under a contract without that term or with a term less unfavourable to himself."
The questions that the court might therefore ask itself are: did the buyer have a genuine alternative? If not, was it because of the unequal bargaining strength of the relative parties? That approach would cover the Commission's guideline (a) but would place less onerous requirements on the buyer to demonstrate that his bargaining strength was less than that of the seller, if indeed it was. It would also take into account guideline (d) whether the buyer was offered and accepted a benefit of compensation for the exclusion of liability and, we believe, also guideline (f) whether the goods were made specially for the buyer himself.
Of the two remaining guidelines laid down by the Commission, guideline (e)
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relates principally to exclusion clauses which limit the time within which claims may be made. I know that that guideline in the Commission's Report has received criticism on the grounds that liability can be considered fairly only in relation to events which were evident or foreseeable at the time when the contract was made. To take account of other and later events would introduce, so it is said, an intolerable degree of uncertainty to the contrary; and we did not think the intention of guideline (g), the remaining one, was at all clear. Obviously, my Lords, in Committee we can discuss all these related questions in greater detail than I have endeavoured to do.
The noble Lord, Lord Janner, raised one interesting point about a replacement article. With great respect, I do not think that an Amendment of the kind he suggested would be really necessary. I believe that in any case which I can foresee a replacement article would still be supplied under a contract of sale, notwithstanding that it was exchanged for an original piece of merchandise delivered under the original contract. I believe the courts would hold—although I agree that they do not yet appear to have had such a case—that the implied conditions were still appropriate; or at least that it was an implied term of the contract whereby the customer agreed to release his rights in respect of the original breach on terms similar to those applied in the original contract. Of course, if the manufacturer or the retailer replaces an article under the express terms of a guarantee in a case where the customer goes to him direct, the implied conditions would not apply, but here I feel reasonably confident that the courts would extend any terms in the original guarantee to the substitute article.
My Lords, I am glad that this Bill has received such favourable consideration from your Lordships. It is, of course, only the first of a series of Bills for consumer protection which we hope will be passed during this Session of Parliament. I was grateful to the noble Baroness, Lady Phillips, for her graceful and gracious recantation of her slightly derogatory words during the debate on the Queen's Speech and for the kind way in which she opened the discussion which is now drawing towards its close. I thank the House and those who have taken part in the debate for their consideration of this Bill

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and I hope that we may now give it a Second Reading.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

PRISONS: CONDITIONS AND TREATMENT
6.25 p.m.
LORD DONALDSON OF KINGS-BRIDGE LORD DONALDSON OF KINGS-BRIDGE rose to ask Her Majesty's Government whether it would not be wise for the Home Office to relax certain old-fashioned restrictions on inmates of Her Majesty's prisons and to establish regular means of communications between inmates and the authorities for discussion of conditions and treatment rather than to allow the iniative to pass into the hands of demonstrators. The noble Lord said: My Lords, I think the calm and dispassionate atmosphere of your Lordships' House at half-past six on a November evening is a suitable place in which to discuss the rather passionate background of the Question I have put on the Order Paper. I chose the form of an Unstarred Question to air the problem of prison conditions because I believe that airing is exactly what they need. I think that the official attitude tends to be rather stuffy, though I know that many officials are very progressive. In preparing what I am going to say to-night I have had a great deal of help from my own staff at NACRO and the Howard League, and my only fear is that the material will interfere with my respect for the clock. I shall do the best I can to be short, but there are a number of things which I think must be said, and there are very few people whom we are hurting to-night, save the Minister who is obliged to stay. So I am not going to cut, out of respect for your Lordships' feelings, what I have to say.
My Lords, I am quite certain that the Prison Service, from top to bottom, from the Home Office to the newest uniformed recruit, really is anxious to treat people in their charge properly and to make prison into something more than a purely negative experience. It is because of this, and because I believe that this can be brought about only by a vast improvement in the staff/inmate relations that I am so hostile to the machinations of the organisation called the Prisoners' Rights
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Organisation—PROP—which at one time, I think, did something to undermine these relations. This seems to me absolutely fatal. Ninety per cent. of the people in prison think that they were wrongly convicted, and those who do not think that feel that they were unfairly sentenced. So clearly there is a great deal of ground for grievance and for anybody to stir up trouble. But the grievances, whether real or imaginary, are, I believe, surpassed by the daily frustration caused by lack of communication and the feeling, which is certainly not imagined, that it is next to impossible to get anybody to listen, let alone to give an answer which is not felt to be a bureaucratic "brush-off".
Every prison governor knows that he is sitting on a volcano. I was in "The Tombs", the remand prison in New York, a month ago: it is a terrifying place—though perhaps this is not the place to say so. Among other things, I was watching high school certificates being given to graduates who had been on remand long enough to qualify, when a journalist came to my companion and said, "Have you heard? It has just come through on the 'ticker', that the warden of Washington Prison has been taken as a hostage?" And indeed, my Lords, he had. He was quite soon released in return for a promise of earlier hearings. But my companion turned to me and said, "This, you see, is what we have lived with at the back of our minds the whole time, ever since Attica."
We in this country are not, by quite a long chalk, as bad as that, but I have to confess that some remarks by Mr. William Cahn, President of the United States National District Attorneys' Association which were published in The Times last year, after he had made a tour of our prisons, were pretty depressing. Among other things he said:
"Overcrowding in British jails is a short fuse on a long stick of dynamite. We saw three men crowded into small cells and heard about the cells being locked at 3.30 or 7.30 until 7.00 or 8.00 next morning. I do not think that prisons should be like some sort of social gathering or country club, but this sort of thing is just not healthy."
We know this, my Lords, but it is rather depressing to find someone from the United States where, on the whole, conditions are so much more difficult than ours, making this kind of criticism. There was, in fact, a nasty feeling in the air

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in the summer when, as a result of outside agitation, there were some concerted acts of disobedience. The staff dealt with these acts in such a very old-fashioned, British policeman, way that there was no trouble of a serious kind and there was no violence. The members of the revolutionary organisation, like many better revolutionaries before them, are now fighting among themselves, and I think that this particular organisation will not give us much more trouble. But because all prisons are dangerous, I believe that we must try very hard to eliminate all unnecessary sources of friction.
I should like to begin by denouncing the petty restrictions on governors. I should like the Minister to study the standing orders which, with their weekly crop of amendments, adorn each govnor's desk, and wherever he can (which I think would be several times on each page) strike out the order and substitute: "Leave to the governor's discretion." I know that every governor breaks his standing orders every day of his working life in order to treat his charges better and more liberally than his orders allow. In the end, men have to come out of prison, and to prepare them for this their self-respect must be restored. That means, in the long run, trusting them. When to begin this operation is the most difficult thing to determine, and only the man on the spot can make the decision. But if we do not trust the governors, how can they teach trust to the men? They are not even allowed freedom to delegate. Governors have to do many things which in my opinion they ought to be able to pass down the line; and this is thoroughly bad for the morale of the prison. If the Minister would go through the standing orders with the idea that staff/inmate relations are the most important thing in prison, and that governors should be chosen because of their ability to control men in their own way, he would in my opinion do more to effect the sort of change that we all want to see than he could in any other way.
My Lords, the action procedure of reception into prison seems to be—and I think very likely was originally—designed to take away a man's self-respect. Such things as the substitution of a number for a name or of ill-fitting prison clothes for the man's own, or the
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failure perhaps of the police station to forward possessions, so that a man may be left several days unable to read without his glasses, produce bitterness at the beginning of a man's term. On the question of clothing, is it really necessary to fit everybody out with prison clothes when they have, and would prefer to wear, their own? Must we have uniformity? If we must, would it not be possible for men with more than short sentences to go straight to the tailor's shop and be fitted out with a new suit which they could then keep for the rest of their time? I understand that at the moment the tariff to get one is three ounces of tobacco. I think that this should be laid on in some other way.
Then there is the question of letters. Prisoners on remand complain constantly and from every quarter of difficulty in communication with the outside. In my opinion there is no excuse whatever for this. In the first place, it is difficult sometimes to get a sheet of paper. It is difficult sometimes to get a pen. It is necessary to get hold of the welfare officer or the chaplain, and they are very busy. I was speaking to a governor the other day who said that he would like to go out and buy 100 mirrors, but this was more than his job was worth. This is ridiculous. People in that position ought to be able to spend out of petty cash enough money to make the prison run properly.
I come to censorship. I think there is a case for censorship in the case of dangerous men who may be likely to escape. In the case of disturbed men, who may be very much upset by a letter, I think the more paternal sort of governor can sometimes save trouble by anticipating the effect of the letter. But surely in normal cases this could be a random censorship, and not 100 per cent. The fear of the authorities that if they allowed prisoners to write as many letters as they wished the staff would be flooded out, because of the censoring, has always been proved, whenever it has been tried, to be false. It was tried a few years ago in Broadmoor, as a result of the agitation of my friend Mr. Peter Thompson. There is now no restriction on letters, I understand; and no trouble whatever. The look on the Minister's face makes me hope that I am not exaggerating. I believe that it is one of the most important things of all. Few

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prisoners are anxious to write letters, and those few who are anxious to do so should be allowed to do so.
My Lords, particularly in regard to a person who is on remand, a governors application is required, which means turning up at 7.30 and all the paraphernalia that we used to know in the Army for far too many things. On remand, one has to do this to get extra appeal letters and every other kind of thing. This is an irritation which not only maddens the prisoner but wastes the governor's time, because when he is in the prison he must, under prison regulations, take all applications personally—another thing that I think is wrong. If a person wants to see a dentist while he is in prison, he has to go on sick parade at 7 a.m. and wait in his cell until 11 or 12 o'clock until somebody comes to see what is the matter with him. These are trivial things, but they are the kind of things which could be put right and the abolition of which would go a long way to avoid the risk of explosions.
It is not much to the credit of the powers that be that pretty well every improvement in the visiting of prisoners by their families and friends has been the result of volunteer action, though it is much to the credit of governors that many of them have given the volunteers every encouragement. But you really cannot shut a man up miles away from his family and make no proper arrangements for the family to visit. With honourable exceptions—none too many—visiting times are arranged for the convenience of the prison and never for the convenience of the visitor. I had to go and see somebody in Winchester the other day. Visiting hours are 9.30 to 11.30. The trains are such that you either catch the half-past eight or the quarter to nine, which, if you live out of London, as many visitors do, means starting very early, or you catch the next train at a quarter to ten, which means that you have only a quarter of an hour with your husband or whoever it may be. Governors and prisoners behave very well in breaking these rules, but my point is that those rules should not be there for them to break. I should like to see a directive to all governors of prisons to say that they must have a shelter for people who are waiting outside until the prison opens to
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visitors; and they must have a crèche inside the prison for children. Money should be put aside for this; and this is money the prisons should have to spend. We in the voluntary movement would provide the workers. If it is not sure what is wanted, the visitors themselves, if they were asked, would certainly tell you.
My Lords, there is a rather more serious but less obvious thing—and I believe this, too, may be important. I think that every governor in the service would agree that he wields enough stick, but not enough carrot. The cycle of behaviour of a fairly long sentence man is predictable. First of all, he suffers from shock and resentment, and in this time he may blot his copybook and lose his remission. Then he becomes apathetic for a period, and resigns himself. And finally, in the best cases, he makes an effort to get through the rest of his sentence constructively. He studies, paints or does something to make things go, and becomes a useful and good member of the community. Governors ought to be able to reward this sort of man for good behaviour. They want to, but they cannot. It was recently suggested by Mr. Hugh Clare that they should be allowed to award a good deal of extra remission during this period, but as things are, they are not even allowed to put back the remission which the man has lost earlier. I should like the Minister to look at this point carefully, because I think it is as important as any point that I am making.
The parole system has worked marvellously well for those people whom it lets out; but, as I know my noble friend Lord Hunt agrees, it has left many serious scars on those people it has not let out. I am inclined to think that the principle needs looking at again. At the moment, a man is eligible for parole after 12 months or a third of his sentence. A good many men are not suitable for parole at that time, and they get turned down—the prison slang is that they get "a knock back". That has a very bad effect on people, particularly when it has happened two or three times. As the cases come up every year, and as parole has been going for about four years, a man could have been turned down four times by now. This is not conducive to restoring confidence. My own feeling is that the eligibility for parole should be

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something that a man has to earn in prison; that he should not be automatically eligible at any time, but have to earn it on a governor's report. That would give the governor a carrot, and would, I think, give the whole prison an initiative and stimulus to work towards the same end. The one thing that all prisoners want to do is to get out of prison: and we might get a whole prison working in the same direction in this way which it would be very difficult to do in any other.
On training, I should like to ask the Minister how many men—I know he cannot give me a numerical answer—come out of prison having learned something which is useful to them and which they did not know before they went in. I am afraid that there are only a few. Only one adult in 35 receives vocational training, and in borstal the figure is one in four. The working week, though it has got better, is still only 28 hours, and the tragic thing is that 25 per cent. of the effective work force is employed on cleaning or sewing mailbags—which is quite a large proportion. I do not mind necessary cleaning, but I do not care much for unnecessary cleaning. I object very much to men sewing mailbags by hand, and I think that most people in the Service also object to it. I should like to ask the Minister to make his target for 1973 the abolition of mailbag shops. It is a task which is hardly better than picking oakum, and it is just as useless. I do not want the Minister to fob me off with the old fox-hunting defence that the fox throughly enjoys it. I know that there are a few old stagers in prison who get very good at this absurd job and they can sew 30 mailbags a day—or is it a week? I cannot remember which.
VISCOUNT COLVILLE OF CULROSS: A day.
LORD DONALDSON OF KINGS-BRIDGE: And these men make quite a decent amount of money by prison standards; but they are very few. All right, let them; but do not let us see even the most villainous young man, however wicked, in full health, coming from perhaps an athletic life, put on to this heartbreaking job. It really is not fit for our society. Where we provide proper work, I think we fail to give enough incentive by way of production
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bonuses. I believe that this is something that should be looked at carefully. I do not know whether this is included in the new Prindus scheme which the Minister mentioned last week, but it probably is.
As to prisoners' pay, we know the difficulties but I beg the Minister to be bold. I know that he cannot solve this problem, and I know that he cannot arrange for cards to be stamped and for a man to get full pay straight away, but I do believe that he could fairly easily pay more than he is paying. I see no reason why in open prisons, where there are very many less difficulties than in closed prisons, people should not do a full day's work and get a full day's pay. I believe that most people think this is probably what ought to be done. There has been a kind of block about doing this and I want to see the Minister kicking some of the bricks down. I should also like to know whether current rates of pay have even kept up with inflation, because I am not at all sure that they have.
There are one or two further points that I would mention. First, pre-release employment. Should this be restricted to men with four-year sentences? Could it not be made available for people serving shorter sentences? There is an anomaly that even if you have pre-release employment and are keeping your family, you cannot draw F.I.S. because you are not living at home but in prison. These are two pieces of bureaucracy working at cross-purposes, and I should have thought the situation could fairly easily be put right. I know that prison governors must be able to deal with violent and dangerous men, but is bread and water really the right way in 1972? I observe that there were 1,200 cases of restricted diet mentioned in the latest statistics, and they were all in the same sort of prison. Also, similar prisons had many more cases of restricted diet than others. I think it is time this was stopped. I do not believe it is an effective punishment, and any governor who cannot do without this is probably where he ought not to be.
My Lords, as regards sanitation, we all know that it is still disgusting; we all know that "slopping out" is a terrible thing. We all know there are difficulties about the right answer, and we all know that ours is the worst there is, and so I should not want that problem to lose the

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Minister's attention for one minute. Then there is the question of savings. A man gets £4 when he comes out of prison, which is the same as it was in 1964. I must remind the Minister that there has been inflation and that probably a man ought now to be getting £7. There has been an increase of the most complicated kind—so complicated that I have not brought the circular with me—which applies to homeless men in certain restricted conditions; but otherwise the ordinary man still gets £4 eight years later, after the biggest inflation ever known. Worse than that, the means test is applied rigidly. If a man has up to £5 saved, he can still draw his £4 on discharge, but if he has £6 in savings he can draw only £3; if he has £7 then he can draw only £2—so much so that the better type of welfare officer says to the man. "All right, let us take your savings and I will put them in a savings bank for you so that you will still get your four quid". It probably works all right in many cases, but it is the wrong way round, and it should not be there.
Lastly, as regards food. The allowance in prisons is £1·20 per head as opposed to £2·15 in a mental hospital. Curiously enough, I believe it to be sufficient. I have seen enough prison meals which were perfectly adequate and which the men liked, but I believe there are many prisons where this is not the case. If there are prisons where there are many complaints, then I believe this to be a question of inefficiency. I should like the Minister to tell us whether there are prisons which have regular complaints of this kind and, if so, why something cannot be done about it. There are people like Mr. Lyons and other experts who could probably do better than is being done at present.
My Lords, the biggest single failure—and my time has already run out—is communications. Few prisoners feel that anybody is doing anything for them at all. They are shunted from pillar to post; the staff are moved from one place to another; they never have the opportunity of forming a proper relationship, and the arrangements do not lay out before them opportunities for complaint or discussion. There should be wing meetings in every prison every week. There are in most
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central prisons, but I do not believe there are in local prisons. There were in Winchester when I went there the other day, and I believe there are some also in Swansea. But not many prisons have them. There ought to be prison committees over everything. There ought to be a kitchen committee, a television committee, a sports committee, an entertainments committee; and there ought to be "Any Questions" once a week, to give prisoners an opportunity to say what they like and blow off steam. This is done in the best central prisons, and it ought to be done everywhere.
The man who is shut up is deprived of initiative in the outside world, and he must be given more initiative in the world within which he is confined. I believe that in many prisons he is given virtually none. I believe this is the most important way in which one individual at the top of this organisation could change things. I do not think it would be difficult to change. I believe that more communication could easily be established, and I hope that the Minister will give this his attention. It is very easy to talk. The Prison Department has a terribly difficult job. I only ask that we do not make it more difficult than we need by failing to get rid of those rubs and blisters which are quite unnecessary, and it is with this in mind, my Lords, that I ask the Question standing in my name on the Order Paper.
6.47 p.m.
LORD SOPER: My Lords, I hope that my noble friend who has just sat down will not interpret a comparatively empty House as an indication of the triviality of the subject matter of his Unstarred Question. I assure him that there can be no more important topic than the one on which he has embarked; and I, for one, have found it impossible to fault any of the observations he made. I would respectfully suggest that perhaps a number of the things which he said were unknown to your Lordships until he said them. That in itself, I believe, is an entirely satisfactory state of affairs—only satisfactory in relationship to the problem which it reveals, and the need to look at this matter not so much as a series of complaints and injustices which should be put right but rather against a backcloth which is much larger. My noble friend

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does not need to be told by me (because he knows it better than most of us, probably) that he has only touched the tip of an iceberg, or perhaps has indicated the thin end of a wedge. As for myself, I should like to think of this not only as an attempt to deal with a number of sprats but also as an attempt to provide a sprat to catch a mackerel of a much larger size.
I hope that your Lordships will indulge me if I try to relate some of the things which have been said to a condition of affairs which is much more general. When I first began to be a chaplain at Holloway, and afterwards at Pentonville, the ethos, if I might call it by that name, of prison life was solitariness—one man to a cell, the prohibition of almost any contact except in the necessary procedure of work, and the total prohibition (which nevertheless was contravened) of discussion or talking at exercise. What has happened since those days, now 30 years ago, is that there has come into being what I suppose could be called a prison society; and that prison society should be viewed with the gravest attention because I believe it is likely to provide a very undesirable alternative to the real society from which, either temporarily or for very long periods, a prisoner is relieved of any responsibility and is shut off.
One of the most pernicious elements in the cell—and I use that word in both senses of its use—of that society is the crowding, as my noble friend has said, of two or, preferably, for homosexual reasons, three men into a cell. This is a total abomination. I plead with the Minister that whatever else he takes away from the conversation to-day, he will press on as quickly as humanly possible with provisions whereby men can at least tolerate life within the size of a cell intended for one, and not for two or three people. Here is the seedbed of a great deal of a thoroughly squalid and unnatural community.
When I was at Pentonville I was told—and I had no reason to doubt it—that about 3½lb. of tobacco was thrown over the prison wall into the grounds every week. Where did that tobacco go? I did not have it; the warders got only some of it; it was largely acquired by the "barons" and distributed by them. One of the most dangerous elements in any
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prison society is that it becomes a totally corrupt society, because those who have the greater power, and are the more corrupt, are liable to produce in that society the very worst elements that go with any community that we can think of. Therefore I should be extremely chary of any process whereby we attempted unduly to create within the prison the kind of society which I believe can, in the long run, be only deleterious to the true interests of 90 per cent. of the prisoners. That does not exclude the proper use of leisure time, and the occupation of that time in constructive and objective ways. But the idea of shop stewards and a trade union of prisoners within the prison itself is, if one thinks about it, utter rubbish and contemptible.
There is nothing more dangerous than the cultivation of this unhealthy society, and the inevitable promotion of some of the elements that make it so detestable, which are inevitable if we attempt to reduce the amount of solitariness to which a prisoner has hitherto been committed, and endeavour to provide him with some kind of social life in leisure or some useful occupation—much preferable to sewing mailbags. It is against this backcloth that I regard my noble friend's Question to-day as of supreme importance.
If we believe that whatever deterrent and remedial and reformatory processes that can be applied to a prisoner have the intention of returning him sooner or later. suitably improved in social habits and personal behaviour, to a real world, then it is of the highest importance that while he is within the framework of a prison society he should not be cosseted or encouraged into a kind of unreal world—an unreal world in which, as soon as you enter its portals, you are aware of its distinctive smell. I am talking now of the block prisons. I well recognise that when the Minister comes to reply he will tell us that what we are talking about is not some attempt to produce a vis a tergo impression on the Government, but an attempt to recognise that the Government are already in motion and what we want to secure is overdrive. I do not believe that the various experiments which have been made fall under the kind of condemnation that I have presumed to utter. But I am assured from my own continued experience that until we finally get rid

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of the block system of prisons we are in grave danger of creating the kind of society which, instead of seeking to return a man to probity and decency, will only drive him deeper into the dirt and misdemeanour of evil.
As I see it, one of the most important and significant elements in this discussion is the way in which we can keep alive and stimulate the real world in the minds and attitudes of those who for a time are necessarily exposed to all kinds of temptations, and indeed circumstances, which, temporarily at least, create an unreal world.
Here are some of the suggestions that I would respectfully submit to the Minister. I am impressed by the immediacy and availability of the telephone. The more I think about it, the more I am satisfied that a great many of the matters raised so eloquently and persuasively by my noble friend could find some immediate amelioration and help if, for instance—and I now chance my arm and make a concrete suggestion—there were upon every landing a telephone, which could be suitably monitored and which from time to time those who had adequate reasons for seeking to use it would be permitted so to do. They might, if this was expensive, pay out of their allowances for the use of the telephone.
What would it do? My experience as a prison chaplain is that there is nothing so impersonal as occasional letters, or so frustrating as the delay which often accompanies the answers to them. There is nothing so frustrating as the sense that by this means real contact is not being established, and the perturbations that follow are agonising. I am thinking, for instance, of women in Holloway anxious to know about their children. They write letters, but the replies come infrequently. I think of the immense satisfaction and improvement to their psychological condition if they can from time to time find directly and immediately at the end of a telephone the kind of information they seek, the kind of communication with the outside world—particularly that which is near and dear to them—which is now so much a matter of dull print and occasional postage.
Furthermore, if it be true that only about 37 per cent. of those entitled to
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various benefits within the Welfare State take the trouble to seek them, this is particularly true of people in prison. In my experience, they are, through carelessness, or perhaps inability to read the small print—or even the large print—unaware of what they can do. There is nothing that would stimulate their sense of self-reliance more than the opportunity to find a direct approach to such welfare authorities, and indeed potential employers, as might give them a chance when they come out of prison.
There is one thing that I am sure my noble friend would have added to his list of conditions which prevail among prisoners; and that is not only the apprehension felt by a prisoner when he comes into prison, but the even more terrifying apprehension that he has about a week before he is likely to go out of prison. This is due to the fact that he has been in a protected and a particular kind of society to which he has become acclimatised and conditioned. In most cases he is frightened of the world which awaits him when he gets outside the prison walls. The most likely welcome will be to take him to the local pub and "souse" him up, rather than give him any constructive help. The telephone carries with it a number of possible dangers, but I have every reason to know that probation officers and prison visitors are quite sure that this would be an immense improvement to the situation, so that communication can be maintained with the real world at the time when the menace of the unreal world is so compulsive.
This is not said in any spirit of sentimentality about prisoners. Professionally I am against sin; and practically I have had plenty of experience of what happens to people when they repeatedly behave in anti-social ways. But, as I see it, there is no justification for any kind of punishment which does not, however long the tunnel, indicate some kind of light at the end of it. There is nothing more conducive to persuading a prisoner to look at that light and take his comfort from it as the regular and periodic acquaintance with and renewal of contact with the real world. I am bound to say as I sit down that I do not believe in the prison system anyhow. But half a loaf is better than no bread; and this must serve in the interim between now and the time when we can reverse the

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whole idea of prison life as one of getting people away, putting them away and forgetting about it; the time when we can indeed demolish all the block prison systems.
I am persuaded that we do nobody any good by prison of the traditional type; that the recovery rate is extremely small. And, having but lately embarked upon an adventure in seeking to care for boys out of borstal, I am reinforced in the conviction that what is much more necessary than almost anything else at the moment—and I hope the Minister may feel disposed to say something about this—is a different kind of custodial treatment altogether. It may be that open prisons and suchlike institutions are moving in that direction. If that is so, then may the pace increase, and quickly! But there is no answer to about seven out of ten of the observations and comments that were so magisterially made by my noble friend within the framework of a prison system which does not totally and utterly reject the assumed premises upon which people hitherto have been incarcerated and treated in this kind of segregated fashion.
My Lords, as I have tried to say, the all-important element in a prisoner's hope is that he will not finally be frustrated in his attempt, if he wants to make it, and will not be finally denied the opportunity which may stimulate that desire, to return to a real world; and that real world, I am sure, must still be kept before his eyes within the walls of prison life and within all the framework of custodial treatment which very properly he may have attracted by his evil doings and ought properly to serve. It is in that regard that I have been very happy to listen to what my noble friend has said, and shall be equally happy to listen, I hope, to what the prisoner has—I mean, to what the Minister has to offer.
7.2 p.m.
VISCOUNT COLVILLE OF CULROSS: My Lords, I do not think I am that quite yet, at any rate. The noble Lord, Lord Soper, was good enough to say to me recently in respect of the speech I made on the humble Address that there were areas of it with which he agreed. I can return the compliment to-day, because there was very little indeed in the speech he made—if I may
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deal with the individual point about the telephone in a moment—when he was dealing with more general matters, with which I should wish to disagree; save, possibly, for the question of smell. It may be that I am not acute enough in the nose to notice it, but it has certainly not been something which has struck me in an my peregrinations around the prison system.
LORD SOPER: Not at Pentonville, my Lords?
VISCOUNT COLVILLE OF CULROSS: I have not been there, my Lords. That may be the exception, but otherwise it has not. The other point that I am not altogether certain about is exactly what he means by "the block system". If he means "Victorian wings", I am with him. In that case there is another area of agreement between us. When we come to the idea of the abolition of custodial treatment altogether, or indeed different sorts of it, I am only too happy to consider constructive proposals tending in that direction. After all, if we are talking about alternatives to custody I hope I have already demonstrated to the House in what I said on the Criminal Justice Bill that I was as enthusiastic about them as anybody.
However, rather than get on to major philosophical points on an Unstarred Question, it might be good if I tried to attend to the particularities of the Question of the noble Lord, Lord Donaldson of Kingsbridge, and some—I hope I can cover the majority—of the things he said. I should like to preface what I say with this. Having listened to the noble Lord, Lord Donaldson, and the items he produced by way of complaint, I would say that if I thought there was any one establishment in the prison system Which corn-billed all those defects I should be in despair. What I think the noble Lord has done—and I hope that those who have been listening to him will appreciate this—is to pick up from a large number of different establishments the one or two things that have gone wrong there. It really must be plain—and I must make this point in advance—that all those defects that he has mentioned do not occur simultaneously in any one single establishment within the prison system. It would be intolerable, I entirely agree with him, if they did.
LORD DONALDSON OF KINGS-BRIDGE: My Lords, I must say one word to the noble Viscount. The feature which I think pervades most prisons is the lack of communication, which is something rather less concrete than the complaints I made.
VISCOUNT COLVILLE OF CULROSS: My Lords, I am going to come to that point, but I think that is not altogether right, either. It must be said that we do not operate a system where all these horrendous accusations can accurately be made about any one establishment. Going on from that, the fascinating aspect that I have found (the noble Lord was good enough to tell me in advance the points that he was going to make) is that there is not a single one of them—nor, indeed, Lord Soper's telephone—which is not already under active consideration by the Prison Department. I have been through this matter with the greatest care and I will refer briefly to what has been said, point by point. Every single one of those points is at this very moment undergoing study by the Prison Department.
First of all, the Question deals with old-fashioned restrictions. One has to bear in mind that restrictions of any sort in a prison are the attempt to secure a balance between security and good order, on the one side, and a constructive and humane régime, on the other. It is certainly not an immutable balance. One is always prepared to consider shifting the point, the pivot, and this is a process that goes on all the time. But both the noble Lord and his noble friend Lord Soper were very right and apposite in speaking about overcrowding as being a root cause of a great deal of trouble. To take three obvious points, problems about visiting, problems about pay and type of work and problems about sanitation are all inextricably tied up with obsolete buildings and far too many people trying to share far too few facilities. It is for this reason, if for no other, that even if there were not a question of the increase that we foresee in the prison population, we must go ahead with the prison building programme on which the Government are absolutely committed. This is a most important and fundamental point, and I agree with both noble Lords on it. That is one side of the problem.
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I also recognise, within what the noble Lord has said, a point that equally may not occur to some noble Lords who have not the familiarity with prisons that previous speakers have. The kind of small things, or apparently small things, on which the debate has so far concentrated can assume a quite disproportionate importance in the minds of people in a confined place such as a prison. A small complaint gets out of all balance in the importance which is given to it by those who think they do, or truly do, suffer it. So I am glad to be able to report an on-going review on these matters.
The first theme is one of management. As to the first half of the noble Lord's Question—and this attaches to a great number of the detailed points he made as well—the origin, as the noble Lord, Lord Soper, has indicated, of the present prison structure, the management structure and régime, goes back a long time to conditions which were totally different from those that we know to-day. They of course required a good deal less demand on staff in those days, both in time and in expertise. Apart from special conditions such as would be found, perhaps, at Grendon, with which I know the noble Lord, Lord Donaldson, is familiar, or in "C" wing at Parkhurst, where we have a very interesting experiment going on, the type of régime of the old days has gone. What we are aiming towards now is the individual treatment and individual case work on prisoners, not the solitariness about which the noble Lord, Lord Soper, spoke. Of course if you change your entire philosophy there is a great deal to be said for looking again at your management structure.
We have already dealt with headquarters; we have already set up a regional system for the Prison Service, and what is now going on is an examination of the management structure within each establishment. Before I started to look into it, I found this a rather woolly idea. I did not know particularly what it meant. It is not the point about a functional group working; it is not getting the best out of the staff: it is not a question of how to deal with troublesome inmates. It is much more fundamental than that. In a nutshell, there have been identified by headquarters the kind of régimes that one wants to see in a good modern prison or borstal. A team is now out on the ground looking at some

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of these establishments to see whether they live up to the rôle that they are supposed to fulfil—and if not, why not? That is actually going on at the moment in the Midland region and it will cover the whole system. This is the sort of exercise which will pinpoint the underlying reason for some of the problems that the noble Lord spoke about, and I think this is a constructive way to do it. Incidentally, I would add that in the process the prisoners are being consulted as well as the governors and the rest of the staff, so that that in itself is an important piece of consultation. We hope that this will produce some proposals next year. In parallel with that there is at the moment in process a Working Party on rewards and punishments which was announced by my right honourable friend in September, and I hope that also will produce some results before long.
I will try to deal with some of these points within a reasonable time, although it may be that I shall be unable to get through all of them. In regard to restrictions on governors, what I have already said I think indicates that this is being done in any event. What the noble Lord may not altogether have put over to the House is that many of the restrictions contained in standing orders are the minimum. If, therefore, relaxations are made they are not breaches of standing orders; they are a reflection of the fact that the situation in the prison is such that you do not have to work on the minimum. You can be more liberal. This is not a breach: it is a perfectly sensible and legitimate exercise of discretion. We must have discretion for governors. The noble Lord is perfectly correct in saying that they must have the power to deal with a personal or a local problem, although at the same time one has to try to see that there is a uniform method across the system of dealing with prisoners. It would not be just if a governor in one prison was treating his inmates much more leniently or in a much more relaxed fashion than another governor in a similar prison somewhere else. This is the balance that one has to find in the process that is going on at the moment. I think that probably we are reaching the stage now where the governor is the manager, or even the managing director, of a much larger affair and he is much less the boss of a
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regimented penal establishment, as in the old days.
There is one other thing that I should like to add about governors. I think it is right that even if the complaint or the application is trivial there 'should be access to the governor if the prisoner insists upon it. Certainly there is an enormous amount of delegation—I think possibly much more than the noble Lord, Lord Donaldson, gave us to believe. But in the end I believe it is right that the governor should be approachable by the individual inmate on something which he really wants to see him about.
As to reception, we must of course spot drugs and weapons—and I am afraid that we still spot lice. But I agree that the machinery and the method for carrying it out could be improved, and at this moment we have training on reception procedures for staff starting in one of the regions. We tend to do it region ally and when we get some results they will be spread round the whole system, With regard to clothes, the fit, size and range of all clothes has been very much improved recently. We have better shirts and better shoes, and all this is in fact halfway through a five-year programme of improvement. Of course women now wear their own clothes in prison, and if necessary they go out to get others in shops. We have not found it possible to follow this procedure with men, but we are attempting to allow men to take their outer prison clothing which has been fitted to them when they transfer from one establishment to another.
With regard to letters and pens, the noble Lord is not really fair to us on this point. The standard ration, of course, is one letter for which the State provides postage and another for which the inmate can buy a stamp himself in the canteen. But there is really not the shortage of pens that the noble Lord spoke about. We have just increased the supply of pens and there are very few wing officers who do not yet have them, and indeed many prisoners have them individually. I do not think the situation in this regard is quite as black as the noble Lord suggested.
This leads on to censorship. Of course the restriction on the number of letters went back to the weight of censorship, and that is one of the reasons why we

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have been trying freedom from censorship. This is now being tried in four open establishments, except for individual people who may have to undergo this particular procedure. Three women's establishments are soon to have this freedom and the aim is to relax censorship at all open establishments altogether. When that happens there will be virtually no limit on the number of letters that can be written, save for the cost of the stamps, for which the prisoner himself will have to pay.
LORD DONALDSON OF KINGSBRIDGE: My Lords, if I may intervene for a moment, may I ask whether there has been any increase in the number of letters written? I do not suppose the Minister will be able to answer me now, but I am most interested in it. I have always assumed that there would not be much difference—there was not at Broadmoor when the relaxation was made, but I should be interested to know.
VISCOUNT COLVILLE OF CULROSS: My Lords, I do not know whether I can tell the noble Lord that at the moment. The important thing from the point of view of the prison authorities is that there has been no fall-off in picking up welfare benefits. I particularly asked about this when I went to one of the establishments where this is going on.
The telephone was mentioned by the noble Lord, Lord Soper, and that fits well into the communications side. It is perfectly true that it is exceptional for prisoners to use telephones but again as it so happens we are experimenting at Winchester. There we have experimented by allowing unconvicted prisoners to ring up certain people. We are proposing to extend this experiment to Risley, which is another remand centre in the North, and we shall see what the results are and whether we can extend it.
The noble Lord mentioned visiting. Last year a survey took place with the co-operation of the Treatment of Offenders Committee of the Magistrates' Association, and they found that there had been a good improvement in the last two years. We spent £200,000 a year on improving visiting facilities. I agree with the noble Lord that there is a great deal that volunteers can and should do. I am
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afraid, however, that it is simply old and obsolete buildings being the problem in many cases. I agree it is deplorable, but what can one do, with the greatest ingenuity, unless one rebuilds or does major adaptations of the gatehouse, and this is going on in a number of places.
It is not true to say that timing is designed to suit the prison rather than the visitor. The noble Lord said that there were honourable exceptions. I would say the other way round, that it must be a case of dishonourable exceptions. A great deal of trouble is taken to fit in with special buses and trains and other visiting facilities. If Winchester is bad, one of the reasons may be the pressure on staff in attending courts. After all, Winchester is a prison that serves a large number of courts in that part of Hampshire and further afield.
On the questions of remission and parole, I will not go into these in detail to-day because these are very much matters that are now before the Working Party on Rewards and Punishments. What the noble Lord said was very interesting and I think that our minds are working along the same lines. What the conclusions will be I know not, but I assure him that he made good and valid points.
The number of people working on mailbags has been reduced from 1,900 in March of this year to just over 1,500 at the present time. Such work has almost entirely gone in training prisons. I will see what I can do in 1973, but the trouble is that while nobody likes mailbag sewing for its own sake, one is faced with the problem of providing a simple job which can sometimes be done in an individual cell and is susceptible of being picked up and put down by somebody who may be going for an interview or may be on only two or three days' remand. Simple, unskilled handwork is difficult to come by in industry nowadays. We are doing our best to replace mailbag work but, with the best will in the world, the alternatives are not easy to find. I agree with the noble Lord, however, on this issue—and I am not here going into the "foxhunting refuge".
Pay is another matter currently before the Working Party. The noble Lord mentioned bonuses and incentives. We have incentive schemes in operation, and about 4,000 prisoners under such schemes

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are now earning up to £1·84 a week. There are a large number of other establishments where work is done on piece rates, and that includes the cleaners and kitchen staff who are rewarded as a result of work study according to effort, which shows that this process goes right across the establishment. I assure noble Lords that these schemes keep up with inflation; the rates have been put up three times in the last three years.
Regarding the pre-release employment scheme, the reason for the four-year threshold is that it is considered—the line must be drawn somewhere—that that is the moment at which people can become institutionalised, and it may be useful to introduce them to the outside world. The trouble at the moment is that the hostels are under-used, partly because probation is taking away people who might otherwise be suitable, and it is difficult to find jobs of the kind that people can do in the immediate vicinity of the hostels we have. This is a very worrying situation.
As for "slopping out" and sanitation, the new prisons do not suffer from those indignities. Again, overcrowding is a basic cause. Old buildings are another. If we could get rid of overcrowding the position would be a little less intolerable; but the only real answer is major reconstruction. The discharge grant which the noble Lord mentioned is also before the Working Party, as are many of these points, including that of bread and water. The purpose of the grant has changed since 1964. It is now meant only to tide someone over his immediate expenditure until he can get supplementary benefit on going out, and an extra £4 can be paid direct to homeless people as an advance for rent. This is an improvement, though the noble Lord was a little "sniffy" about it.
On the question of food, the essence is training of catering staff and imagination in the use of money. I was pleased, after the business of the dogs and the prisoners at Leicester Prison, to read a transcript from a local Leicester Radio programme the other day which said that the food had been carefully looked at by people who I think were not likely to be biased in favour of the Prison Service, and we came out very well on quality, amount and variety. This is, therefore, some-
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thing that is very much in our minds. The important thing is to get the catering staff trained. The other day I went to Kirkham, where there is a training scheme running in conjunction with the Technical College in Blackpool. The food is excellent—I had lunch there—and the results of the courses will, we hope, improve yet further the standards as people go back to their prisons and borstals and put into effect what they have learned.
My Lords, I am afraid I have had to deal briefly with many of the points that have been raised in the debate, but one could write an essay on each one of them. I must, however, deal with the question of communications. I will leave out the existing channels of communication through which prisoners can go. I appreciate the interest of noble Lords in this matter, but there is a varied and very complex hierarchy of communication. It is important to remember that these communications exist. All I will say about them is that in the process a great number of grievances are put right. When they are not put right to the satisfaction of the prisoner there is usually a very good answer. If there is not, and if a mistake has been made, it almost always comes to light and is rectified. The official hierarchy of complaint and grievance procedure is thorough but, as a result is not necessarily very quick.
However, I feel that what the noble Lord was really asking was: how far in this day and age should prisoners have as it were a corporate voice in the discussion of conditions and improvements? I say "how far" because in about half of the prison establishments and borstals there are already schemes whereby people can take part in consultative committees of groups of one sort or another. For the most part these groups are functional. They discuss matters like catering, and they sometimes draw prisoners to some degree into the management of institutions and give them an opportunity to contribute to decision-making. Experiments are taking place to see how much further this sort of functional committee system can sensibly and safely be taken
We must, of course, take care to bring the staff with us and make certain that they are convinced, as are the prisoners,

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that this is a good way to go about the matter.
However, I do not think that committees of this sort provide the complete answer. I draw the attention of the House to the fact that they are widespread merely to show that it would be wrong to draw from the noble Lord's speech the idea that there are no channels of corporate communication in the system now, or that there is nothing but a gulf between the authorities and the prisoners. We are looking at matters in addition to the ordinary functional committees on television, catering and so on. There is at one prison a quite sophisticated experiment going on whereby staff/prisoner consultative committees are built into each level of the line management of the prison. For example, there are on each wing committees representing the staff and prisoners, with a central committee discussing matters that cannot be disposed of by wing committees. There is a good deal to be said for the noble Lord's suggestion that the wing should meet as a whole, rather than having elected committees. There are difficulties about this in large local prisons, as the noble Lord will recognise, but it is important to see that the management structure of the prison provides for points raised in discussion to be taken further. This is where we start to run into difficulty.
A talking shop may be all right but it can increase tension rather than reduce it, and that kind of situation arises when people start demanding things that neither the wing officers nor the prison as a whole, nor even my right honourable friend the Secretary of State himself, can provide. If you get to the situation where they are negotiating either against, or possibly over the head of, the local prison staff, then you get into a dangerous situation and one where you can cause more trouble than good. It is that sort of balance and care that we have to use in studying this machinery. We are trying to provide advances in this field. We have looked at difficulties that have arisen abroad and on the whole I think I can tell the noble Lord that we are pursuing this matter as carefully as we can and with a good deal of enthusiasm, though with some caution. These points really
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all pull together, because that also is a management matter.
What I must finish up with—I am sorry I have gone on for rather a long time, but the noble Lord asked me a great many questions, and he was entitled to an answer to them—is that when one is talking about these individual aspects of prison life and régime, on the one hand, and, on the other, the constructive approach that the noble Lord, Lord Soper, was particularly mentioning, of involving prisoners realistically in aspects of their life where they can participate to their own satisfaction and to the satisfaction of the staff, you have to talk about it against a background or found it upon a substructure of orderliness, discipline and mutual tolerance, at the very least, between prisoners and staff. I say "at the very least" because that has to be built up by every possible means so that you get the whole relationship: there is one of training staff and retraining them if necessary to deal with the individual aspects of each prisoner, which I mentioned before. We have to build it up to a total environment—if I can use the overworked word—of rehabilitation. But that kind of reform and rehabilitation will never be possible without that substructure of good management and orderliness. I believe that when my right honourable friend stressed this the other day he was perfectly right.
I have been reading (and I get masses of letters passed on to me from prisoners) of complaints from people in prisons where demonstrations and troubles took place. They said, "We took no part in these, yet we could not go out on exercise and the food was late and cold. We did not go to work. We have had no pay. The place has been in chaos. Why should we be subjected to this treatment?" Of course, if the staff are engaged in putting down a major demonstration and are getting people down off the roof, other innocent people do not get on with any rehabilitative work at all and it stands to reason that they suffer. I am sorry about that, but the first priority is to restore order and get things back to normal. That is the first way in which lack of discipline and order affects the individual lives and individual rehabilitation of the prisoners themselves. It is interesting, but it goes further than that. I know myself of one important

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meeting of senior officials in the Prison Department who were dealing with just the kind of thing that the noble Lord has been talking about this afternoon, but who could not meet because of the demonstrations. The meeting was put off, the discussions did not take place and the reforms were put back simply because they were diverted by people raising cain in one prison or another across the country. It is worth saying these things. I said so on television on one occasion because people should realise that this is what it means when people try to take the law into their own hands and upset authority and discipline. We must build in the way that the noble Lord has suggested, but we must build on that good order and discipline first. What has been so pleasant about this debate is that it has been orderly and constructive. I am grateful to the noble Lord for the Question and I hope that I shall be able to report further progress later on.

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  HIGH COURT CENTRE IN CORNWALL
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  HEALTH AUTHORITIES IN GREATER LINDON
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