Sitting of 18 July 1973

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  ABERDEEN CORPORATION ORDER CONFIRMATION BILL
    DUNDEE CORPORATION (BROKERS ETC.) ORDER CONFIRMATION BILL
      NATIONAL TRUST FOR SCOTLAND ORDER CONFIRMATION BILL
      Read the Third time and passed.
PETITION

  Shotton Steelworks
  Mr. Barry Jones: With your permission, Mr. Speaker, I beg to present the following petition:
  To the Honourable the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled.
  The Humble Petition of young people of East Flintshire constituency
  Sheweth
  That grave hardship is arising from the plans to rationalise the steel industry in East Flintshire—resulting in the loss of many jobs and consequent financial and social hardship.
  Wherefore your Petitioners pray that your Honourable House do urgently reconsider the decision to end steel-making at the Shotton works of the British Steel Corporation.
  And your Petitioners, as in duty bound, will ever pray.
  To lie upon the Table.

ORAL ANSWERS TO QUESTIONS
  SCOTLAND

    Area Health Boards
    Mr. David Steelasked the Secretary of State for Scotland if he will consider political balance when appointing the additional members to the proposed new area health boards.
    Dr. Dickson Mabonasked the Secretary of State for Scotland what consultations he had with representatives of the Conservative and Unionist Party in Scotland about recent appointments to the area health boards; and how many members of the Conservative and Unionist Party in Scotland were appointed.
    The Secretary of State for Scotland (Mr. Gordon Campbell): I do take into account political affiliations, where they exist and are known, but I do not regard this as a major consideration in making these appointments. The political parties were not invited by my Department to suggest names of persons for appointment. There are many members of these boards whose political affiliations, if any, are not known.
    Mr. Steel: I agree with the Secretary of State that political considerations are one of the minor factors of importance in making these appointments, but will he accept that on looking down the list lie gave in a Written Answer on 11 th July I was struck by the fact that, while many members have obvious qualifications to serve, most of those whose qualifications are doubtful turn out to be members of the Conservative Party? This raises queries in the minds of certain hon. Members. Leaving aside political considerations, does the right hon. Gentle. man accept that in making further appointments it would be good practice to consult local Members of Parliament, irrespective of party, with regard to the merits of the individuals he is considering for appointment?
    Mr. Campbell: I do not accept that anyone looking at the list published in HANSARD on 11th July could come to the conclusion reached by the hon.

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    Gentleman from his observation of it. In making the remainder of the appointments we shall welcome suggestions of members to be appointed on their qualifications and the contribution they can individually make.
    Dr. Mabon: Is the Secretary of State aware that of the 179 lay appointments that he has made to the boards, 29 are identifiable as members of the Labour Party, either as local councillors or taking part in other activities, while slightly fewer than 100 are members of the present governing party in this House but not in Scotland? I am not able to give the precise figures, but the disproportion is about three to one. Is not that a disgrace? Is not it high time that the Secretary of State realised, if he is to keep his reputation for fairness in making the appointments—which is slightly in jeopardy at present—that he will have to make a much better selection than he has done so far?
    Mr. Campbell: I do not accept what the hon. Gentleman has put forward. The list includes a number of well-known supporters of the Labour Party, some of whom are particularly prominent members of that party, and some who have been appointed as chairmen of the boards. The list includes some known supporters of the Consevative Party and many who have no political affiliation, or whose political affiliation is not known. I do not accept that there is anything like the disproportion that the hon. Gentleman suggests. As far as I can see, there is a reasonable balance.
    Sir F. Maclean: Apart from political affiliations, will my right hon. Friend bear in mind geographical considerations and, in filling the remaining appointments, will he see that adequate representation is given to North Ayrshire, about which I have written to him?
    Mr. Campbell: Yes, I shall certainly bear in mind geographical considerations. On the Ayrshire and Arran board, out of the four local government members three are Labour supporters.
    Mr. Baxter: Does the Secretary of State recollect that I wrote to him some time ago putting forward a suggestion on the lines of that contained in the supplementary question of the hon. Member for Bute and North Ayrshire (Sir F.
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    Maclean)? Will the Secretary of State tell the House—because he did not tell me in reply to my letter—what organisations or individuals he consulted in various areas?
    Mr. Campbell: I shall be answering this matter, in a manner which I am sure will be satisfactory to the hon. Gentleman, in reply to a later Question.
    Mr. Ross: I take it that the Secretary of State is sincere in what he says, but in view of the remarks by hon. Members on this subject will he reconsider the matter and check whether there is an overbalance on one side or the other and seek to put it right in remaining appointments?
    Mr. Campbell: As I indicated in my original answer, this will be one of the considerations in mind, but the main consideration must be the personal qualifications and the value of the contribution which an individual can make. But there are other points relating to geography, and also the question of political balance.
    Dr. Mabon: In view of the unsatisfactory nature of the answer, I beg to give notice that I shall seek to raise this matter on the Adjournment at the earliest possible moment.
    Mr. Robert Hughesasked the Secretary of State for Scotland if he will define the criteria governing the eligibility for service on area health boards of those persons who receive payment from the area health board.
    The Under-Secretary of State for Health and Education, Scottish Office (Mr. Hector Monro): Persons whose employment brings them into a line management relationship with the chief officers of a board, for example, administrative and nursing staffs, are not regarded as eligible for membership.
    Mr. Hughes: Do not the consultants and general practitioners have a contractual relationship with the boards? Do they not advise the boards in relation to the allocation of resources? Does not the chief medical adviser often have to discuss with his board the plans of the consultants? At present these people are making the appointments of chief medical officers. Is not this a wrong concept entirely?
    Mr. Monro: I cannot accept what the hon. Gentleman says. There is a very special contractual relationship between consultants, general practitioners and the future area health boards which is very different from that of the line management of the nursing profession.
    Mr. Grimond: In the interests of open government, will the Scottish Office consider publishing a White Paper on the methods of appointment to all public boards covering, for instance, whether paid people are eligible, who keeps the list, who is consulted, how far political affiliations are taken into account, and what priority is given to retired civil servants?
    Mr. Monro: I think that all the appointments made by my right hon. Friend have been excellent, but he has heard the right hon. Gentleman's views and I have no doubt that he will give them consideration.
    Mr. Sillars: May I raise with the hon. Gentleman the question of the relationship of consultants with the health boards? Do not consultants have a pecuniary interest in policy decisions of boards about full-time or part-time appointments? Ought they not to declare an interest and take no part in the proceedings when boards decide on appointments?
    Mr. Monro: These matters must be considered in the light of the fact that consultants and general practitioners have a great weight of experience to give to the boards in relation to the National Health Service. It is that experience that we wish to have.
    Mr. Lambieasked the Secretary of State for Scotland if he will appoint the remainder of the members of area health boards before they next meet.
    Mr. Monro: No, Sir.
    Mr. Lambie: That is a very unsatisfactory answer. Will the Under-Secretary inform the House which faceless mandarin at St. Andrew's House thought up this undemocratic method of appointing only part of the membership of the area health boards? Surely it could not be a politician like the hon. Gentleman.
    Is the hon. Gentleman aware that when these further appointments are announced
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    all the major decisions about management and the appointment of chief officials involving salaries of more than £10,000 a year will have been made? This is not fair to existing members. When is the Minister going to cut out all this nonsense and get a bit of democracy back into these appointments?
    Mr. Monro: The hon. Gentleman is having one of his brighter sessions today. More than 200 organisations put forward nominations, so there was no question of my right hon. Friend and me drawing them out of a hat. The position was carefully considered. My right hon. Friend has made it plain that political affiliation is only a small part of the consideration.
    Mr. Robert Hughes: When the hon. Gentleman consulted the nurses before the reorganisation Bill went through the House did he tell them that the right of appointment which they then had would be done away with? Secondly, will he address himself to the point raised by my hon. Friend the Member for Central Ayrshire (Mr. Lambie)? Is it right that two-thirds of the eventual board membership should make all the decisions about the number of districts, appointments, allocations, and so on? Surely the hon. Gentleman must do something about that.
    Mr. Monro: Nurses have seen the Powell Report, about which the hon. Gentleman knows, dealing with nurses in the integrated health service and explaining the position of line management. As I have said, the other appointments will be made later this year, in plenty of time to make a valuable contribution to area health boards.

    Caledonian-MacBrayne Limited
    Mr. Donald Stewartasked the Secretary of State for Scotland what control is exercised in the day-to-day operation of shipping activities by the Scottish Transport Group over Caledonian MacBrayne Limited; and if he will make a statement.
    The Under-Secretary of State for Development, Scottish Office (Mr. George Younger): These are management matters, which are the group's own responsibility.
    Mr. Stewart: I am sorry that the Minister has not given the assurance that

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    was implied in the Question. During the recent trouble with the ferry from Ullapool to Stornoway it was believed that the shipping company had acted promptly to overcome the lack of a vessel and was overborne by the Scottish Transport—
    Mr. Speaker: Order. The hon. Member must put his remarks in the form of a question.
    Mr. Stewart: Is the Minister aware that in future the shipping company should have a say in the day-to-day running of the ferry services? May I again thank the Minister for his attendance and assistance at the meeting held in Stornoway?
    Mr. Younger: I am grateful to the hon. Gentleman for that comment. I enjoyed my visit to Stornoway and was glad to be present at the inauguration of the service. I met the town council and we had a useful meeting. I expressed the regrets of all concerned at the inconvenience suffered by some passengers in the early days of the service. We must bear in mind, however, that this is now a far better service than Stornoway has ever had before, with a service twice a day instead of once a day, and a service that is quicker, with better carrying capacity and a better turn-round. I asked the council whether it would give the new service a fair trial, and it agreed to do so.

    Psychiatric Patients (Computerised Information)
    Mr. William Hamiltonasked the Secretary of State for Scotland if he will make a statement on the extent to which medical information and other personal details about psychiatric patients entering hospital are computerised; where such records are kept; and to whom they are available.
    Mr. Monro: My right hon. Friend's reply of 4th July to the hon. Gentleman covered psychiatric in-patients and, as stated then, all personal details are confidential. Information about psychiatric cases is held under conditions of strict security on the Scottish Office computer and access to it is restricted in all cases to named medical officers of the Scottish
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    Home and Health Department.—[Vol. 859, c. 155.]
    Mr. Hamilton: Is the hon. Gentleman aware that the guarantee given about confidentiality of information has been challenged and breached in the case of the national census? In that instance a guarantee was given to everybody in the country and it was breached in a number of instances. What guarantee is there that this information will not be available to anybody without the consent of the patient himself? Does he not agree that it is not sufficient to have the consent of the clinician or the doctor concerned? There must also be the consent of the patient, because there is growing concern about the continued invasion of personal privacy.
    Mr. Monro: I note what the hon. Gentleman says about patients and I give him an absolute undertaking in regard to consultants. I know that the hon. Gentleman was in the Chamber last Friday for the debate on this subject, and I am sure he took note of the fact that my hon. Friend the Under-Secretary of State for the Home Department said that there would be a White Paper later this year covering the health service.
    Mr. Ronald King Murray: Will the hon. Gentleman say whether data entered in the computer include details of outpatients as well as in-patients?
    Mr. Monro: I cannot answer that question in detail without notice. My impression, and, indeed, my information, is that it applies to in-patients only, because it happens on discharge from the hospital.
    Dr. Miller: I wish to ask two questions. First, what other records are entered in the computer? Secondly, what kind of computer is used, how many terminals exist, and to whom are they open?
    Mr. Monro: I think I shall have to write to the hon. Gentleman about both parts of his question. This involves information relating to the reasons why a patient is in hospital and the treatment which he or she receives, but it is absolutely confidential. This matter is being examined by the Home Secretary in relation to the White Paper that is to be published later this year.

    Lanarkshire Health Board
    Mr. James Hamiltonasked the Secretary of State for Scotland how many consultants, general practitioners, nurses, trade unionists and members of local authorities have been appointed to Lanarkshire Health Board.
    Mr. Monro: The 14 members so far appointed to the board include two consultants, one general practitioner, five members of local authorities and two trade unionists, one of whom is also a member of a local authority. No nurses have been appointed to membership, nurses in the employment of a health board not being eligible for membership.
    Mr. Hamilton: Is the Minister aware that there is a great deal of dissatisfaction in Lanarkshire because four of the people appointed are out with the Lanarkshire area? Is he further aware that, understandably, the nursing profession is up in arms because it is not represented on these boards? Does the Minister appreciate that there is disquiet in Lanarkshire at the appointment of the chairman, who, so far as we can ascertain, has no experience of hospital boards?
    Mr. Monro: All those who have been appointed to the health board either live in or are involved in Lanarkshire in business or in one way or another. Secondly, on the question of nurses, on which there is a later Question on the Order Paper, there is a single structure of line management under the new area health board system, up to chief nursing officer. It would be inappropriate for nurses serving under her to be members of the area board. As my right hon. Friend has said, members of boards are appointed for their skill and knowledge of what they can add to the health board in general, and the Chairman of the Lanarkshire Health Board is a particularly experienced person.
    Mr. Brewis: Since teachers can be co-opted to serve on education committees, would it not be possible to deal with the nursing profession in the same way in regard to health boards?
    Mr. Monro: There will be a nursing advisory committee on every area health board, so that there is no question of the nursing profession's views not being heard and considered by the boards.
    Mr. Robert Hughes: Is the Minister saying that, because general practitioners and consultants are on the boards, there will not be consultative machinery to give other advice?
    Mr. Monro: There is consultative machinery, as the hon. Gentleman knows. He also knows that there is a different contractual set-up for consultants and general practitioners, compared with nurses.
    Mr. Wolrige-Gordon: Is my hon. Friend aware that participation is one of the great new cries at present, and does he not agree that there is much to commend the suggestion put forward by my hon. Friend the Member for Galloway (Mr. Brewis)?
    Mr. Monro: As I have explained, nurses will have a particular say through their own advisory committee. This will be an important means by which they can put forward anything which they feel will be of help to the area health boards.
    Mr. John Smith: Since it appears that nurses are being treated unfairly vis-à-vis doctors, if the line management business is causing trouble why cannot the Minister change it and stop the disaffection among the nursing profession before these boards have even got off the ground?
    Mr. Monro: If the whole system of line management were to be changed, it would be a major operation, involving the future of area health boards. I am not prepared to contemplate such a change at this moment. Nurses are eligible to be appointed to area health boards if they are not employed by the National Health Service.

    Craig Dunain Mental Hospital
    Mr. Maclennanasked the Secretary of State for Scotland if he will take steps to reduce the potential overcrowding at Craig Dunain Mental Hospital.
    Mr. Monro: Steps have already been taken to deal with the potential overcrowding at Craig Dunain Hospital. In 1969 the bed complement was 1,030 and the occupancy rate was 100.8 per cent. It is now 950 and the occupancy rate is 95 per cent. Also, provision has been made in Band V of the current major

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    building programme for improvements at this hospital to relieve overcrowding.
    Mr. Maclennan: The Minister has admitted to me already that there is pressure on the space in the hospital. What immediate steps can he take to reduce it? Can he, for example, arrange for the transfer of those who can be suitably accommodated in geriatric homes? When will work begin on the extension in Band V to which he referred?
    Mr. Monro: As the hon. Gentleman knows from the letter that I sent him a week or two ago, improvements costing £200,000 are in hand. The extensions will improve conditions in the hospital.
    There are comparatively few patients who might be considered for transfer. They number about 20, and I do not think that the additional work involved in doing what the hon. Member suggests would be justified. In any event, the patients are comfortable there and we do not want to disturb elderly folk unnecessarily.
    As for the hon. Gentleman's question about Band V, it is not, as he knows, the custom to give a starting date. But it is some years ahead yet.

    Remands in Custody
    Mr. Lawsonasked the Secretary of State for Scotland on how many occasions in the past year young people have been remanded in custody by sheriff courts prior to sentence; what was the average period of such remands; and on what grounds such remands were made.
    The Under-Secretary of State for Home Affairs and Agriculture, Scottish Office (Mr. Alick Buchanan-Smith): In 1972, 9,645 persons under 21 years of age were committed on remand to penal establishments. This figure covers both remands awaiting trial and remands for the purpose of considering sentence. The substantial majority are remands by sheriff courts. The average period for persons of all ages remanded in penal establishments was 13 days: separate figures for persons under 21 are not available.
    Courts do not state the grounds on which they decide between liberation with or without bail and remand in custody.
    Mr. Lawson: Is the hon. Gentleman aware that within recent months two cases have come to my attention of young constituents of mine who have been remanded in custody for no discoverable reason other than the intention of the sheriff to teach them a lesson, in addition to the sentences subsequently imposed? Does the hon. Gentleman not agree that this is possibly an abuse of authority and a matter that ought definitely to be looked into by someone or some body with the ability to act over the heads of these courts?
    Mr. Buchanan-Smith: I am aware of the hon. Gentleman's concern. In relation to the allegation that he makes, I do not think that there is any evidence that this is taking place. If it were taking place it would not be a very good practice. However, the decision is one for the courts. It is not an administrative decision. Each case has to be decided on its merits.
    Mr. Hannan: Is the hon. Gentleman aware of the growing concern in circles interested in these matters? Is he satisfied that the Crown Office exercises sufficient vigilance in cases under the Social Work Act? The point is that at procurator fiscal level there is discretion on the question whether cases go to court at all. Will the hon. Gentleman consider whether there is not too much reliance on traditional methods and a reluctance to implement the proposals in the Social Work Act?
    Mr. Buchanan-Smith: With respect to the hon. Gentleman, he is raising a wider question, about the procedure before a person appears in court, whereas the matter raised by the hon. Member for Motherwell (Mr. Lawson) is one strictly for the courts and not one in which I can intervene.

    Teacher Supply
    Mr. Richard Buchananasked the Secretary of State for Scotland if he is aware of the shortage of schoolteachers in Glasgow and the West of Scotland; what proposals he has for increasing the supply of teachers; and if he will make a statement.
    Mr. Monro: In secondary schools the serious shortages are now largely confined to Lanarkshire and to Roman

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    Catholic schools in Glasgow and Renfrewshire. The supply of teachers should improve rapidly from session 1974–75 onwards.
    Mr. Buchanan: I am unhappy about the complacency emanating from the Scottish Office over the shortage of teachers in this area. The Minister will know that there is a parlous shortage of teachers in Glasgow and, projecting ahead to the new region, we see a combination of areas which have experienced a continuing shortage of teachers. Will the hon. Gentleman consider finding a new home for the training of primary teachers, and also consider making Jordan Hill a graduate college for secondary school teachers?
    Mr. Monro: There is no complacency about the shortage of teachers. I made that clear in our recent debate on the Estimates and I have done so at any time that I have discussed the matter of teachers, especially in relation to Glasgow and Lanarkshire. But the primary pupil-teacher ratio has fallen in the West of Scotland from 31.0:1 to 28·0: 1 and the secondary from 175:1 to 16·2:1 over the past two years. The situation is improving. But I do not seek to hide the fact that we are short of teachers in these areas.
    Mr. Hugh D. Brown: The hon. Gentleman says that there will be an improvement in the year 1974–75, but this is 1973. Will he consider the immediate situation with a view to working as flexibly as possible the scheme for designated schools with additional allowances?
    Mr. Monro: That is exactly what I am doing at the moment. I am having discussions with the Scottish Teachers Salaries Committee to see whether we can increase the number of designated posts in the West area.
    Mr. Carmichael: In the White Paper the Government talk about restricting the number of primary and secondary schoolteachers going through colleges. Are they content to look for an overall sufficiency throughout Scotland, or will they consider giving additional inducements to teachers in the West of Scotland to improve the imbalance there? Can anything be done to help in the transferred schools, where the shortage is extremely acute?
    Mr. Monro: Apart from the issue that I am looking at now, of what posts are available for transfer, the designated scheme is due for review next year. As for limiting the entrance of teachers to colleges of education, the immediate problem in 1973 is that we are dealing with teachers who are leaving colleges of education this term and not with those who are entering. As the hon. Gentleman knows from the debate on the Estimates, by 1976–77 we shall have an adequate teaching force for the whole of Scotland.

    European Trade Mark Centre
    Mr. Dalyellasked the Secretary of State for Scotland what action he is taking to seek to ensure that the proposed European Trade Mark Centre is located in Scotland.
    Mr. Gordon Campbell: The hon. Gentleman will have seen from the reply given by my right hon. and learned Friend the Minister for Trade and Consumer Affairs to my hon. Friend the Member for Bedford (Mr. Skeet) on 12th July that the Government have decided to propose that the European Trade Mark Office should be sited in London.—[Vol. 859, c. 432.]
    Mr. Dalyell: What fight have Scottish Office Ministers shown, both in our own Cabinet and in the corridors of power in Brussels, to get something that, in terms of both employment and effect on industry, is probably more important than the European Patent Office, which has been committed to Munich?
    Mr. Campbell: The siting of the European Trade Mark Centre will be a European decision. It has become clear that if it is to come to Britain at all London is the only starter. [HON. MEMBERS: "No."] In competing with other countries it is clear that in this instance it is London or nothing.
    The hon. Gentleman referred to a fight. I should point out that during our time we have succeeded in getting the headquarters of the Forestry Commission moved to Edinburgh. That will produce twice as many jobs as the trade mark centre. Right hon. and hon. Gentlemen opposite were content to leave the Forestry Commission headquarters at Basingstoke.
    Mr. Edward Taylor: Is there any prospect of any of the major agencies of the Common Market coming to Scotland to provide jobs? Would it not be extremely unfortunate if the coming of the trade mark centre to Britain simply added to the congestion that already exists in London? Would it not be more satisfactory to have some of these jobs going to Scotland? If some of these bodies come to Scotland, will my right hon. Friend make sure that we do not have site prices forced up by land speculation in Dundee and elsewhere?
    Mr. Campbell: I shall certainly ensure that in every case of a European office or centre coming to the United Kingdom the suitability of Scotland and its chances of getting the site will be examined and pressed. It is clear that this centre, which will provide only a small number of jobs, would not come to Britain at all unless it were to London. But by transferring suitable headquarters, such as the Forestry Commission and the White Fish Authority, we can get many suitable jobs for Scotland. I believe that is the way to do it.
    Mr. David Steel: Does the Secretary of State recognise that when European centres are being considered the fact that London is the only starter, as he put it, is a reflection on the lack of adequate communications with Scotland? Will he consider that matter in relation to the need for a central Scottish airport? What fight is he putting up against the development at Maplin, which will merely accelerate the myth of London as the only centre?
    Mr. Campbell: I am sure that the hon. Gentleman has unintentionally misrepresented what I said. It is simply that in this case London is the only starter——[Hon. Members: "Why?"]— for a number of reasons. Communications with Scotland are not the main reason. As the hon. Gentleman knows, communications with Scotland are good. Therefore, Scotland is suitable for the setting up and establishment of offices and centres. There are other reasons in different cases which make it essential that a European centre should be in London or not in Britain at all.
    Sir F. Maclean: Is my right hon. Friend aware that the Isle of Bute would
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    be an ideal site for the European Trade Mark Centre?
    Mr. Campbell: I am very much aware of that, because this is the second time within three days that my hon. Friend has pointed it out to me.
    Mr. Robert Hughes: Will the right hon. Gentleman give the reasons for excluding Scotland as a location for this office?
    Mr. Campbell: It is not a question of excluding Scotland. I could not give all the reasons in reply to a supplementary question, but I shall write to the hon. Gentleman giving him the information.
    Mr. Dalyell: On a point of order, Mr. Speaker. In view of the Secretary of State's position in the Cabinet and the feckless nature of his reply, I beg to ask leave—
    Mr. Speaker: Order. The hon. Gentleman must state his notice in the usual form if it is to have any effect.

    Council Tenants (Rents)
    Mr. MacArthurasked the Secretary of State for Scotland how many local authority tenants, other than those receiving supplementary benefit, are paying no rent because of the provisions of the Housing (Financial Provisions) (Scotland) Act 1972.
    Mr. Younger: I understand that in the four cities alone there are several thousands of tenants whose total rent is met by rebate. This is in addition to those whose rent is paid by supplementary benefit.
    Mr. MacArthur: Do not these impressive facts show the extent to which this wise Act helps families with low incomes—a protection that was totally denied them by the Labour Government?
    Mr. Younger: My hon. Friend is absolutely correct. Whereas rents have been covered for those on supplementary benefit, both under the old legislation and in equivalent form in the new legislation, the Labour Government made no provision whatever for those who were not on supplementary benefit but could not afford to pay their rents. This Government have done so, and there are

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    thousands of people in Scotland who, as a result, pay a nil rent.
    Mr. McElhone: Will the Government come clean on this point? Among the many thousands mentioned by the Minister, how many are widows, how many are receiving disability benefit, how many are wage-stop cases and how many are unemployed and not receiving supplementary benefit? That will expose once and for all the bogus point being made by hon. Gentlemen opposite that many employed people pay no rent.
    Mr. Younger: It would greatly help the argument if we could get the facts straight. I should make it clear to the hon. Gentleman that none of these people is on supplementary benefit. They are already completely covered. I should also point out that the numbers of these people are known unofficially from inquiries made in some of the cities. It is difficult to get the figures over the whole of Scotland. The hon. Gentleman will know that about a month ago we were informed that there were 3,300 in Glasgow, about 3,000 in Edinburgh, about 1,600 in Dundee, and 1,460 in Aberdeen. These are all in addition to the people on supplementary benefit. It is clearly time that the Scottish Labour Party faced the fact that this is a more generous scheme than anything it ever dreamt of.
    Mr. Lawson: Just how low must a person's income be before he or she can have what is called a nil rent—in other words, pay no rent at all?
    Mr. Younger: That depends on the size of his family, and his circumstances. These matters have to be taken together. However, tables are published in the rent rebate scheme pamphlets. It is easy to obtain this information. If the hon. Gentleman has any difficulty, I will give it to him.
    Mr. Edward Taylor: Will my hon. Friend ask his right hon. Friend the Leader of the House to adjust the rules of the House of Commons to make provision for the hon. Member for Glasgow, Gorbals (Mr. McElhone) to make an apology to this House and the people of Glasgow for blatantly misleading them?
    Mr. Younger: I am sure that my right hon. Friend will note what my hon. Friend has said. I consider that the first
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    step in this difficult matter is to try to get the facts explained satisfactorily to the hon. Member for Glasgow, Gorbals (Mr. McElhone). Once he has understood the situation, perhaps he will then pass it on to his constituents.
    Mr. Ross: As there are about 1 million council tenants involved in Scotland, would it not be a good idea if we got the figures? Will the hon. Gentleman tell us how many people who were and are still in receipt of rent rebates are now paying higher rents?
    Mr. Younger: All those facts could be investigated. It will be difficult and require a lot of work to get figures over all Scotland. But it would certainly be a good thing if we could get the maximum information, because it would demonstrate that there are thousands of people whom the Labour Government did not help but whom we have helped greatly.

    Police Forces (Co-operation)
    Mr. Dempseyasked the Secretary of State for Scotland how many police forces are operating in Scotland; how many have enlisted the aid of the regional crime squad in murder, etc., investigations; and if he is satisfied with the present degree of co-operation.
    Mr. Buchanan-Smith: The number of forces is 20, and all regularly enlist the aid of the Scottish Crime Squad. I am satisfied with the present degree of cooperation.
    Mr. Dempsey: is the hon. Gentleman aware that it is gratifying to learn that all chief constables are inviting the aid of the regional crime squad? Does not the hon. Gentlemen agree that cooperation between police authorities and the crime squad is essential, as the criminal today knows no boundaries, has no scruples and shows no humanity? Will the hon. Gentleman convey to the chief constables my appreciation of the cooperation that leads to the using of this pool of professional expertise to detect crimes that have been committed and to prevent many other serious crimes from taking place?
    Mr. Buchanan-Smith: I endorse everything said by the hon. Gentleman, and I am grateful for the support that he gives not only to the Scottish Crime Squad but

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    also to police forces generally in Scotland. I am sure that not only the two chief constables but individual police authorities in Scotland are convinced of the value of this crime squad in the modern situation, and the more power and success that it has the worse it is for criminals.
    Mr. John Smith: Will the hon. Gentleman take this opportunity of saying what the celebrated Scottish Council on Crime is doing? Last time we asked about it the hon. Gentleman said that it had identified subjects for further consideration. It is a long time since the council was appointed. What has it done since then?
    Mr. Buchanan-Smith: The Question relates to the crime squad. The hon. Gentleman has raised a totally different matter, and if he waits a little longer he will see what the council is achieving.

    Hillend (Bypass)
    Mr. Adam Hunterasked the Secretary of State for Scotland what recent representations he has had requesting reconsideration of the question of a bypass road at Hillend in Fife and if he will make a statement.
    Mr. Younger: I have received one recent representation, from the hon. Member himself. In view of the proposals for construction of the East Fife regional road I would not feel justified in providing a bypass of Hillend on A92.
    Mr. Hunter: I agree that the construction of a bypass at Hillend should not go ahead while the construction of the East Fife regional road is in prospect in the near future, but is the hon. Gentleman aware that the villages of Hillend and Aberdour are suffering from the effects of an ever-increasing volume of heavy traffic? If the regional road is not to materialise soon, should not some consideration be given to the people in that part of Fife in order to relieve them of this ever-growing burden of noise and discomfort? Will the hon. Gentleman tell the House when the regional road is likely to be commenced?
    Mr. Younger: I am grateful to the hon. Gentleman for raising this matter with me on many occasions. I very much sympathise with those who live
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    in the village of Hillend, because of the traffic problems from which they are suffering. In consultation with Fife County Council we are making satisfactory progress in the preliminary proceedings for deciding the line for the East Fife regional road. I am hopeful that if the consultations, which are nearly complete, continue satisfactorily we shall soon be able to make a firm placing for it in the programme. That being the case, I feel that we should concentrate on the East Fife regional road in order to secure some relief for the people affected.
    Mr. MacArthur: Will my hon. Friend request the road authorities in East Scotland in general to take particular care that they do not become the victims of land gazumping in and around the city of Dundee?
    Mr. Younger: I deplore action by anyone which unnecessarily increases the price of land and houses, and it would be particularly regrettable if that were done by people in local government, but I note what my hon. Friend has said.

    Government Offices (Dispersal)
    Mr. Douglasasked the Secretary of State for Scotland if he will commission a study of the multiplier effect of the location of Civil Service jobs in Scotland since 1964.
    Mr. Gordon Campbell: A retrospective study of this magnitude would be disproportionately expensive in cost and manpower. I am, however, considering with my colleagues the feasibility of a study related to the multiplier effects of selected office dispersals as they occur in the future.
    Mr. Douglas: I accept some of the economic difficulties mentioned by the right hon. Gentleman, but does he not admit that what the Hardman Report is dealing with is not the dispersal of 30,000 jobs but the creation of 50,000 jobs, and therefore the contribution that Hardman envisages for Scotland is niggardly indeed? Will the right hon. Gentleman examine this carefully and put up a strong fight in the Cabinet to get the Hardman figures substantially increased?
    Mr. Campbell: The House should know by now that the report contains the

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    recommendations and views of Sir Henry Hardman and not those of the Government. The Government are considering the multiplier effects that were discussed in the report, together with all the other matters in it, before making their views known.
    Mr. Maclennan: Whatever the exact results of this inquiry, the fact is that the multiplier effect is widely recognised. Does not that make it totally unacceptable that the Government have written off Scotland as a European trade centre? Does not the right hon. Gentleman recognise, as others throughout the rest of the country and Europe do, that Edinburgh is a great capital city, of European standing, and that it would be highly suitable for this purpose? If the right hon. Gentleman accepts that, will he say why he has written it off as a non-starter?
    Mr. Campbell: The hon. Gentleman has misrepresented what I said earlier. I said that the siting of the trade mark centre was a European decision and that it had become clear that it was either London or nothing. That does not mean that Edinburgh, which is a capital city and which has shown that it can offer the facilities required for headquarters and conferences, should not be suitable for other kinds of European offices and centres, and that fact will be pressed by me on every occasion.
    Mr. John Smithasked the Secretary of State for Scotland if he will raise the matter of the Hardman Committee's Report at the next meeting of the Scottish Economic Council.
    Mr. Gordon Campbell: The council gave preliminary consideration to the report at its meeting on 22nd June.
    Mr. Smith: Will the right hon. Gentleman say at what conclusion it arrived? Does the right hon. Gentleman understand that everybody in Scotland—both sides of industry and Scottish Members—will join in the battle to persuade the Government to give more Civil Service jobs to Scotland? Does the right hon. Gentleman further understand that in order to make it effective he has to lead the campaign to change Government policy? What does the right hon. Gentleman propose to do to make sure that this stupid report is reversed?
    Mr. Campbell: The hon. Gentleman was not a Member of the House at the time, but those who were will recall that I was a member of the Government and in a key position concerned with the question when the decision was taken by the previous Conservative Government, nearly 10 years ago now, that the Post Office Savings Bank should be moved to Glasgow. Beneficial results have flowed from that, including the provision of about 6,000 new jobs in the Glasgow area. This is something about which I am vitally concerned, and I hope to have the support of Scottish Members on both sides of the House in making sure that all that Scotland can offer is considered and taken fully into account before decisions are taken.
    Mr. Edward Taylor: Will my right hon. Friend ensure that the Scottish Economic Planning Council considers the possibility of advising the Government of the benefits of dispersing the headquarters of nationalised industries based in London? There is a case for dispersing Civil Service jobs to Scotland, but is not there an even greater case for dispersing some of the headquarters of nationalised industries which are many miles away from the industries they control?
    Mr. Campbell: My hon. Friend has raised a separate matter, but one that has similar considerations. It certainly ought to be borne in mind.
    Mr. Ross: May we take it, then, that the Secretary of State was not party to the Government's decision that the rest of Scotland, apart from Glasgow, was a non-starter in relation to dispersal?
    Secondly, when the right hon. Gentleman is preparing his briefs in respect of answering the Hardman position about Scotland's undesirability or impracticability in relation to the efficiency of government, and so on, will he answer the questions about communications and the Scottish Office dispersal? Apparently it is not realised that at one time the Scottish Office was in London and that it was not the Ministers who were dispersed but the jobs. If the right hon. Gentleman prepares the briefs, will he give a copy to every Scottish Member, because in this we shall be united to ensure that Scotland benefits?
    Mr. Campbell: I welcome the right hon. Gentleman's remarks. I am glad to think that he will be supporting me in doing things for the benefit of Scotland. The right hon. Gentleman was incorrect in his first statement; the Glasgow area was indicated as a suitable location but not to the exclusion of other Scottish locations. He will recall, as will many hon. Members, that there was a campaign—which I welcomed—by the Glasgow area, before the Hardman Report was published, and that I was then making it clear that this must not be to the exclusion of other parts of Scotland, including the new towns.
    Mr. Grimond: As the Secretary of State has rightly said, Edinburgh is suitable as the headquarters for certain European institutions, and so on. What are the institutions and headquarters—either British or European—that the Government are pressing should go to Edinburgh?
    Mr. Campbell: These subjects arise from time to time. When suggestions are made for headquarters, or the moving or setting up of headquarters, we shall make sure that not only Edinburgh but any other suitable part of Scotland is considered.
    Mr. Ross: Has the Secretary of State read the Government's statement in the preface to the Hardman Report? Paragraph 6 says that the Government endorse
    "Sir Henry Hardman's view that few rather than many locations should be selected."
    The only one that the right hon. Gentleman considers among these few in Scotland is Glasgow.
    Mr. Campbell: The right hon. Gentleman did not listen to what I said. This is a report by Sir Henry Hardman. The Glasgow area was indicated as a suitable location because of its capacity and on regional policy grounds, but not to the exclusion of other areas of Scotland.

    North Sea Oil
    Mr. Strangasked the Secretary of State for Scotland if he will now seek additional powers to control onshore industrial development associated with North Sea oil.
    Mr. Gordon Campbell: Local planning authorities have comprehensive powers to
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    control developments and the Secretary of State has powers to call in for decision any planning application where he considers it necessary or appropriate to do so.
    Mr. Strang: Does not the Secretary of State agree that there is now an overwhelming case for planning and controlling North Sea oil developments on an all-Scotland basis and that, while local consultation is important, the present arrangement of local planning inquiries and the calling in of applications by the Secretary of State is quite unsatisfactory? Is the right hon. Gentleman reviewing the present position?
    Mr. Campbell: First, as I indicated, the powers are now on an all-Scotland basis, because the Secretary of State can call in, in any particular cases where he deems it appropriate. But if there is to be local democracy and if promoters and objectors are to be given the chance to state their views, the procedures that Parliament has laid down in order to protect them in the planning Acts have to be followed.
    I have made it clear that I am satisfied with the powers that exist. Although I shall never be satisfied that the procedures are perfect, those procedures have been laid down by this House, and it would take a considerable time to go through them and to change them. I am applying the Acts in as flexible a way as possible for the benefit of Scotland.
    Mr. Galbraith: Will my right hon. Friend examine the technical possibility of building oil rigs in sections in the existing industrial areas, which could easily accommodate them, and in that way reducing the damage to the countryside? If that were done he might not have so many of these cases to call in and examine. This is a technological problem. Will my right hon. Friend consider it?
    Mr. Campbell: My hon. Friend is absolutely right. This is something that we are aiming to do. Some of these platforms are built in sections and put together later. But even in industrial areas, as has been the case recently in Fife, for example, some people may consider that a site is suitable, but none the

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    less objections are raised, which have to be considered.
    Mr. Douglas: Will the Secretary of State try, wherever possible, to bring the manufacturers together to discuss the technical problems involved in construction? The major item is access to deep water. That is necessary in the final stages of construction, but not in the initial stages. Will the right hon. Gentle. man examine the technical feasibility of this and of using sites that are already used for industrial development?
    Mr. Campbell: Yes. This is being achieved through the recent establishment of the Oil Development Council for Scotland, on which there are not only representatives of those concerned with the oil industry but persons who are well qualified to speak about the environment and its protection.
    Also, technological changes occur. For example, platforms that were being built in steel six months or a year ago may now be built in concrete. That requires different considerations. There may be further changes. That is why continuous review is necessary.

    Regional Development (EEC Committee)
    Mr. Russell Johnstonasked the Secretary of State for Scotland if he will seek to ensure independent Scottish representation on the proposed EEC Committee for Regional Development.
    Mr. Gordon Campbell: The Commission has yet to publish its proposals for membership of the Regional Development Committee. My intention will be to ensure that the interests of Scotland are taken into account in the work of the committee in the most effective way.
    Mr. Johnston: That really is no answer. Is it the view of the Secretary of State that Scotland should have direct representation on such a committee? Will he accept, also, the view that regional economic weakness is often directly related to a lack of effective political projection?
    Mr. Campbell: We have to await the Commission's proposals, which have not yet been put forward. My main concern is that Scottish interests should be
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    pressed. How best that can be done we shall have to wait and see.
    Mr. Edward Taylor: In this connection, has not the Commission told the British Government that we must not pay grants of 4 per cent. to the Marathon Company at Clydebank, as has been extensively reported? If that is so, how does that square with the assurance that we have been given that the regional grants set out in the Industry Act and the White Paper could continue to be paid until 1977?
    Mr. Campbell: I understand that my right hon. Friend the Secretary of State for Trade and Industry has now received a communication of the kind that has been reported in the Press, and is now considering a response to it.

    Litter Acts (Prosecutions)
    Mr. Baxterasked the Secretary of State for Scotland how many prosecutions have been instituted under the Litter Acts; how many were convicted; and how many have been fined the maximum of £100 over the last two years.
    Mr. Buchanan-Smith: Five hundred and twenty-five and 537 persons were proceeded against for contravention of the Litter Acts in 1971 and 1972 respectively, and 515 persons were convicted in each of these years. No person was fined the maximum of £100 during this period.
    Mr. Baxter: Is it not a sad state of affairs that it costs the community in the United Kingdom roughly £25 million a year to combat the litter louts when this law is being breached by the authorities by not imposing maximum fines upon people who despoil our countryside? Will the Minister see that notices are sent to police authorities, magistrates, and so on, stating that the maximum penalty should be imposed?
    Mr. Buchanan-Smith: Basically, the matter is for the police authority and local authorities in the areas involved. The question of the penalty that is imposed is entirely a matter for the courts to decide, and not one in which the executive can interfere. But I have no doubt that the views that the hon. Gentleman has expressed today will be taken notice of outside the House.
    Mr. MacArthur: Who is responsible for clearing litter from the land involved in the recent land profiteering scandal in the city of Dundee?
    Mr. Buchanan-Smith: The Dundee Corporation.

    Cattle Census
    Mr. W. H. K. Bakerasked the Secretary of State for Scotland what were the figures for the most recent cattle census for Scotland.
    Mr. Buchanan-Smith: The provisional results of the 1973 June census indicate that there are 2,580,000 cattle, 1,920,000 in the beef herd and 660,000 in the dairy herd, representing increases of 8, 10 and 3 per cent. respectively compared with June 1972.
    Mr. Baker: Are not these most encouraging figures? Does my hon. Friend agree that the industry is indeed working in the interests of the consumer of beef in Scotland?
    Mr. Buchanan-Smith: I am grateful for what my hon. Friend has said. The expansion of the beef herd in Scotland in the last 12 months is the biggest annual increase ever recorded. My hon. Friend is absolutely right that increased self-sufficiency of this nature helps to protect the British housewife and consumer from the full effects of world shortages.
    Mr. Strang: When will the Government stop this nonsense of pretending that one of the arguments for British agricultural expansion is that it will reduce food prices? That was never true. In the Common Market it is doubly untrue. Of course we are in favour of expansion, but that does not mean lower food prices, so the Government should stop kidding the public.
    Mr. Buchanan-Smith: The implication of that supplementary question is that the hon. Gentleman and his party do not want a greater degree of self-sufficiency for Britain. That will be noted by farmers and housewives, whose interests an expanded British agriculture can help, in respect of prices.

  QUESTIONS TO MINISTERS
  Mr. Milne: On a point of order, Mr. Speaker. I seek your guidance and pro-
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  tection for back benchers seeking to raise questions in the House on the subject of the Poulson inquiries and related matters. Briefly, there are two factors I want you to examine. The first is the question of the transference of a Tribunal of Inquiry question from the Prime Minister to the Home Secretary—
  Mr. Speaker: Order. 1 can help the hon. Gentleman straight away. That is not a matter for the Chair. What is the next point?
  Mr. Milne: I understood, Mr. Speaker, that one of your roles was the protection of back benchers in the execution of your duties. As you have given your ruling, I will seek to raise the matter in other quarters.
  The second point is the use of the sub judice ruling by the Table Office. The wording I used—I seek your guidance on this—was that I asked a Question and added the words, "in view of recent happenings in the local government field". I was told by the Table Office
  Mr. Speaker: Order. There is here a very important rule which I think has been repeatedly stated by my predecessors, namely, that if an hon. Member is dissatisfied by a decision of the Table he should come to Mr. Speaker privately first before raising it in the House. I do not think that the hon. Gentleman has come to me about this matter.
  Mr. Milne: With due respect on this point of order, Mr. Speaker, I discussed this matter this morning both with your office and with the Chief Clerk of the Table Office. I am now asking for your ruling in the House.
  Mr. Speaker: I do not in the least want to shut the hon. Member up, but it has been established by my predecessors that a private representation to Mr. Speaker is the proper course first—and 1 have not had any. The matter has not been referred to me. If it is referred to me privately, I will consider it, and if I rule against the hon. Gentleman he is perfectly entitled to raise it in the House. It is a matter of saving the time of the House.
  Mr. Milne: Further to that point of order, Mr. Speaker. My constituents sent me to the House of Commons and,

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  although I try to observe the responsibilities of the House and to carry out its procedures, my duty is to raise matters in the Chamber and not necessarily with Mr. Speaker privately. I am pressing my point of order—
  Mr. Speaker: No. I must follow precedent. My predecessors have repeatedly ruled that a matter of this sort should not be raised in the House until it has been raised first with Mr. Speaker. The purpose of that is to safeguard the time of the House.
  Mr. Milne: I want to make just one final point on this point of order. It is not necessary for Speakers in their duty as Speakers of the House to follow the bad precedents set by their predecessors.
  Mr. George Cunningham: Further to that point of order, Mr. Speaker. I apologise for taking up time, but I think that there is an important point involved. I, too, could quote a precedent where, although you would have preferred me to raise a point of this kind with you privately before raising it in the House, and you so told me, nevertheless I was not prevented as a matter of order from raising it in the House. I ask that you reconsider what appears to have been a confirmation of a previous ruling. It is wrong that a practice which may be convenient and desirable if it is accepted by hon. Members should become incumbent upon them and so prevent them from raising matters on the Floor of the House if they prefer to do it in that way.
  Mr. Speaker: This is a matter in which I have no personal feelings. I do not mind one way or the other if hon. Members take up the time of the House. It is a matter of complete indifference to me, as long as the hon. Members concerned stay within order. However, this was a rule laid down by my predecessors designed to save the time of the House on a day like this when there is a very important debate to come.
  In the case to which the hon. Member for Islington, South-West (Mr. George Cunningham) referred, he at least discussed the matter with me. I want to help hon. Members, and it may well be that I shall not take the same view as my advisers. If I do not, it will not be necessary for the hon. Member for Blyth (Mr. Milne) to raise this matter
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  If I do agree with my advisers, the hon. Gentleman can still come to the House afterwards.
  Mr. Milne: Further to that point of order, Mr. Speaker. You have referred to the time of the House that I have occupied. I have been necessarily brief on this matter and had I been given a ruling the time that this matter occupied would have been something under two minutes. Surely that is not too much to ask for in a matter of this importance.
  Mr. Speaker: As the hon. Gentleman has persisted, I will consider the point.

AGRICULTURE (EEC MINISTERS' MEETING)
The Minister of Agriculture, Fisheries and Food (Mr. Joseph Godber): With your permission, Mr. Speaker, I should like to make a statement on the meeting of the Council of Agricultural Ministers in Brussels this week. The main subjects discussed were sugar, beef and the problem of protein for animal feed arising from United States controls on exports of soya beans.
There were two issues concerning sugar before the Council. The first related to the subvention to United Kingdom sugar refiners which I announced to the House on 28th March, and which is designed to enable us to continue refining Commonwealth Sugar on the same basis as before. The European Commission had warned us that they might have to take the view that this arrangement was incompatible with the Treaty of Rome. I received notification yesterday that the Commission was of that opinion, and so I immediately raised the issue in the Council of Ministers. I explained the importance of this subvention to the honouring of our Commonwealth commitments, and I am happy to tell the House that the Council immediately and unanimously decided to authorise its continuation for the next 12 months.
The second issue related to the arrangements for sugar from 1975, with the three interrelated aspects of continued imports from the developing Commonwealth, the EEC's membership of the International Sugar Agreement, and the future arrangements for sugar beet in Europe. The Commission tabled far-reaching proposals on all these aspects. Obviously they will

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require detailed study, but I should like to call attention now to three points.
First, they provide for the continued import of the full 1·4 million tons a year from the developing Commonwealth, and so are intended to honour the Lancaster House assurances in letter and in spirit. Secondly, they would enable the Community to participate very constructively in the resumed negotiation for a new International Sugar Agreement. Thirdly, they should provide scope for us to secure a justified increase in British beet sugar production as the Australian quota is phased out. I am glad to say that, although obviously all wanted a chance to study these proposals further, the will to honour the commitment to continue to import 1·4 million tons was evident in the initial comments of most Ministers.
The Council also discussed the reduction in cattle prices which has taken place recently. It was decided that import duties which are at present suspended should be restored if the average Community market price falls below 103 per cent. of the guide price for one week. The effect on United Kingdom retail prices should be marginally beneficial, since, although we should have to reintroduce import charges, these would be offset at the current value of the pound by the application of monetary compensatory amounts as subsidies on our imports. Exports from the Irish Republic both as stores and as fat animals which have recently been attracted away from their traditional outlet in the United Kingdom will be likely to revert to this country.
On protein feeding stuffs, the Council decided to put in hand the consideration of the possible diversion from intervention stocks of 50,000 tons of dried skim milk for use in pig and poultry feed between now and the end of the year if the need should arise, and also the possibility of expanding protein production in the Community. These matters will be considered further in the light of the outcome of the visit which the agricultural Commissioner, Mr. Lardinois is to pay to Washington this week and in the light of the protein supplies likely to be available from the USA and Canada.
I also raised briefly the question of welfare to animals in transport and at
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slaughterhouses. The matter is to be discussed now at official level and will be on the agenda of the Council for further discussion in September.
Mr. Shore: On the question of the sugar subvention and the continuation of it for the next year, we found the Minister's barely muted note of triumph on this matter a little odd. While there has always been deep concern on both sides of the House about the continued ability of this country to import 1·4 million tons of Commonwealth sugar after the beginning of 1975, it had never occurred to us that the question of being able to continue refining that sugar was in peril under the arrangements agreed only last January for between now and 1975. So we give the Minister two cheers for that, but if he had come to this House to tell us anything different there would have been a storm indeed.
On the major matter of the arrangements which follow from 1975, we have seen the proposals put forward by the Commission and we have noted that the Commission has proposed that the members of the Community should become members of the new International Sugar Agreement when it is negotiated. That is undoubtedly beneficial, but does not the Minister think, since the Continental Community was a net importer of sugar up to only five years ago that it is extraordinary that it should now be asking for an export quota of 800,000 tons of sugar?
On the continuation of the 1·4 million tons beyond 1975, we noted what the right hon. Gentleman said about the will in most Ministers to honour the commitment. Surely, however, what matters is whether this will to honour the commitment is felt by all Ministers. Will the right hon. Gentleman confirm whether the decision to be made in this matter, as opposed to the proposal, is one of those decisions that has to be made unanimously by the Council of Ministers?
Does the Minister not feel a slight sense of shame for coming to the House on the question of meat prices and telling us that he has come back with an agreement that if cattle prices fall for even one week below the level of 103 per cent. of the intervention price he will slap on again import duties of 20 per cent.? He then has the cheek to tell us

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that any benefit on prices would be cancelled out by the great increase in the costs of the common agricultural policy to which we shall soon have to subscribe.
Mr. Godber: 1 am grateful to the hon. Member for his warm welcome on my return. On the question of the sugar subvention, he said that it was never understood that the subsidy might not continue. This was made clear in the House, to which I reported it on 28th March. It is a highly technical aspect, but the important thing is that all the Ministers immediately supported me when I described the problem which had arisen. That is an indication that all those Ministers believe that it is important that the Commonwealth sugar agreement should be honoured, and that is not without significance in regard to the whole position.
As for the position after 1975, it has proved that it would be right that the Community should operate as net importer. That I agree. The Commission is proposing that it should operate as a net importer, and that is the intention embodied in its proposals. We shall be having further talks at ministerial level about this. We have only just had the proposals of the Commission. But the important thing is that the Commission has said clearly that 1·4 million tons should be allocated for Commonwealth countries, and I am sure that the right hon. Gentleman will welcome that fact, as will his hon. and right hon. Friends.
As to the attitude of some Ministers, it is not unusual for them to query the whole question when there might be a case for some reduction in production in those countries. What matters is what we get at the end of the day and I believe that we shall get a confirmation in line with the Commission's proposals.
On meat prices it is not such a simple matter as the right hon. Gentleman suggests. What I said does not mean that there will be a 20 per cent. duty. We are concerned with a duty of 8 per cent. and the reimposition of this will mean a countering of the monetary compensation amounts so that the consumer will not suffer in this country.
Sir. D. Dodds-Parker: Is my right hon. Friend aware that his statement will
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give considerable satisfaction and encouragement to the Commonwealth sugar producers who have done such a wonderful job for this country and have helped themselves over the last 30 years? Will my right hon. Friend give guidance about the extent to which the proposed cut of about 600,000 tons in Continental beet production can be more than counteracted by the likely increase of 4 per cent. a year for the next two years?
Mr. Godber: There is a general welcome in the Commonwealth for the decisions taken on the initial problem and for the plan of the Community. I cannot give my hon. Friend a precise answer about the 600,000 tons, but there is a significant increase amounting certainly to more than 100,000 tons a year in consumption in the Community and there is at the present time an apparent world shortage of sugar which applies to this problem.
Mr. John Mendelson: Will the Minister also report to the House that the French Minister of Agriculture by his intervention and opposition has had a blocking effect on the proposal put forward by M. Lardinois? The French Minister in his opposition to the Commission's proposal said that the scheme for 1·4 million tons had never seriously been discussed between Ministers before. That is in complete contradiction to what the right hon. Gentleman and other Ministers told the House when this matter was discussed at the time the legislation was going through. Now it is revealed for the first time—and the right hon. Gentleman must come clean and admit it—that this was a one-sided announcement to which the French Government did not agree. M. Schumann said that he did not agree to it at the time and so the Minister's chickens are coming home to roost. What action does the right hon. Gentleman propose to overcome the French resistance, which will adversely affect the poorer Commonwealth countries?
Mr. Godber: Before the hon. Member gets too excited he should know that his facts are not correct. There has been no blocking action by anyone at this time. There have been some preliminary comments by all Ministers. It is for the French Minister to justify his own comments. He said that the present Council of Ministers had not been consulted on

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this figure. The figure of 1·4 million tons was constantly referred to by my right hon. and learned Friend when he was negotiating the Treaty of Accession and the House will recall what he said about the attitude taken by the Community over this matter. We have never hidden from the House our view that 1–4 million tons was right. At the last Lancaster House conference which I convened this year this was repeated. It has never been challenged. The fact that it has been accepted by the Commission and all the Ministers except one is significant at this stage.
Mr. Powell: What is it that has made necessary the subsidising of the refinement of sugar in this country? Is it in order to counteract the high level of world prices or is to counteract the effect of the internal workings of the common agricultural policy?
Mr. Godber: It is to do with the level of the entry price of sugar as determined in the discussions in the Council of Ministers in January this year. When it was agreed at that time, I said in the Council, and I reported to this House. that I believed that the figure which the Council wished us to accept did not give an adequate margin. I said that if that proved to be the case we should seek to have a national subsidy during the period between now and 1974 when the agreement comes to an end.
Mr. Arthur Lewis: Are we to take it that the possible adverse effects of the sugar decision will not operate until 1975, but that they may well operate then? As the decision can and probably will adversely affect the jobs of thousands of workers in my constituency and other constituencies, will the right hon. Gentleman give an assurance that before he agrees to anything further he will discuss the matter not only with the employers in the refinery industry but with the trade unions and the workers on the floor at the refineries in West Ham and the other parts of the country?
Mr. Godber: I think that the hon. Gentleman is confusing two matters. The agreement I have announced will not mean redundancy for anyone. There was and is a problem over a gradual switch in this country from reliance on cane to reliance on beet refining. I recognise the hon. Gentleman's genuine concern. I
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am in consultation with the manufacturers, and we have had consultations with the trade unions involved. I am happy to continue the consultations, because it is very important that everyone should understand the problem, and we want to find a fair solution.
Mr. Farr: I congratulate my right hon. Friend on what he has done for the sugar refiners' margins for this year. Can he assure the House that in any discussion with his ministerial colleagues in Europe he put to them just how vital it is that when the new international sugar agreement is signed the EEC should become a signatory, unlike the present position?
Mr. Godber: Yes, indeed, Sir. That is a point that I and my colleagues in Brussels have repeatedly put. Our view is that we should become parties to the agreement. One purpose of the Community document published a few days ago is to enable that to happen. It is our wish that it should happen. We should play our full part in seeking to achieve it.
Mr. Hooson: Did the agricultural ministers discuss the probable shortage of proteins and cereals for animal feeding stuffs during the coming winter, and its likely effect on food prices in this and other countries? In particular, did they consider that the retaliatory measure of the United States in banning soya bean exports was one of the contributory factors? What do they intend to do about it?
Mr. Godber: The hon. and learned Gentleman may have entered the Chamber after I made my statement. I specifically referred to that matter. We certainly did discuss it. It is a serious matter. Mr. Lardinois, the agricultural commissioner, is flying to Washington today for further discussions with the United States Administration about it. We take a serious view about it. I have referred to several actions we propose to take in the light of our discussions.
Mr. Scott-Hopkins: I congratulate my right hon. Friend on the satisfactory outcome of the preliminary sugar negotiations. Can he enlarge a little about beef? Would it be possible to negotiate to eliminate the compensatory payments if the tariff goes back on again when we reach 103 per cent. of the price?
Mr. Godber: It is a complicated issue. If the trigger mechanism, which is what I proposed, and which was accepted by the Commission, operates at the figure of 103 per cent., the tariffs will be reimposed Levies will not. Because of the present level of prices, tariffs will be reimposed and then monetary compensatory amounts will also be reimposed. They are now in suspense. My information is that for almost every cut that can be imagined. and certainly for main carcases, the effect of the monetary compensatory amount will cancel out the effect of the tariffs, so there will be no increased cost to be borne by the British housewife.
Sir G. de Freitas: Was not the French Minister of Agriculture also reported as having rebuked one of the commissioners for ignoring French national interests? If that is so, is it not completely contrary to Article 157 of the Treaty of Rome?
Mr. Godber: There were reports about that. The French Minister did not do that in the Council of Ministers. What is done in talks with the Press by individual Ministers must be a matter for them to defend and comment upon. The Press is always about, and the French Minister may have said something of the kind. But he certainly did not say it in the Council of Ministers, and it would be wrong for me to comment on it.
Mr. Burden: I congratulate my right hon. Friend on so quickly drawing the attention of the agricultural Ministers to the concern about the carriage and slaughter of animals exported from this country to the Continent. Did he get the impression that they were impressed and would act quickly as a result of the vote in the House last week? Will he give an assurance that there will be no interference, as a result of those discussions, with the Government's decision to suspend exports and to set up an inquiry?
Mr. Godber: I raised the matter. It is now on the agenda for official discussion, and will come back for detailed discussion by Ministers in September. I have taken the opportunity in private discussions with other Ministers to raise the matter, and have achieved a substantial degree of sympathy and understanding. I think that most of them genuinely want to avoid cruelty, just as we do. I hope that we can make progress.
Mr. Raphael Tuck: The Minister said that the French delegate did not adopt a blocking attitude. Are the reports that Mr. Chirac rejected even the limited concession accurate or inaccurate? If they are accurate, how can the right hon Gentleman hold out any hope for the future?
Mr. Godber: I do not think that the hon. Gentleman quite understands the procedures we go through. We had a general discussion on a document, and in that discussion the French Minister expressed his grave concern about the figure and said that he had not considered it. He said that he was disturbed by it He was entitled to say that as a point of view. But it was a sort of "First Reading" debate. We shall be having further detailed discussions, first at official level and then in the Council of Ministers. There is no question of a blocking statement. That is not the way the Community operates. People make statements, and finally one reaches an agreed decision. That is the normal way for the Community to operate. I do not think that that intervention, which was widely reported in the Press, should be given such a great degree of significance. What matters is that the Commission and eight Ministers all took the view that the figure was right, and I hope that we shall persuade our French colleague.
Mr. Marten: My right hon. Friend said earlier that the proposals, which were only proposals by the Commission, were accepted by all Ministers except one. But it is that one that finally matters, so, whatever result the Council of Ministers comes to on the question of the importation of 1·4 million tons, can my right hon. Friend give an assurance that Britain will, if necessary, unilaterally honour that undertaking?
Mr. Godber: I believe that the Community will honour it as such. That is the way in which we should proceed. To start giving undertakings about what would happen in a wholly hypothetical situation would be absurd. The Commonwealth has never asked for that. It understands the position and is opening its own discussions under Protocol 22 next week. We are giving it full support. To say anything of the kind that my hon. Friend suggests would not be helpful.
Mr. Shore: The Minister's last reply was not good enough. The whole proposition of joining the Common Market was put to the House on the basis of certain matters being absolutely firmly agreed, including the continued sale of 1·4 million tons of sugar. Will the right hon. Gentleman answer the question I put to him at the beginning? Is it his understanding that the decision on the Commission's proposal must be agreed by unanimous vote in the Council of Ministers, or can it be agreed simply by a majority?
Mr. Godber: The trouble with the right hon. Gentleman and others is that they are all the time trying to create the idea that there is a crisis in these matters. It is not a matter of confrontation. The way in which the Community works is that we reach agreed decisions. I am quite confident that the Community will reach an agreed solution which incorporates this figure. The fact that the 1.4 million tons is included in the Commission's figure is a strong indication. That one Minister has chosen to question it at this stage does not mean that it is undermined. I am confident that we shall achieve it.

BUSINESS OF THE HOUSE (SUPPLY)
Ordered,
That this day, as soon as the House has entered upon the Business of Supply, Mr. Speaker shall put forthwith the Question which, under the provisions of paragraph 11 of Standing Order No. 18 (Business of Supply), he is directed to put at Ten o'clock.—[Mr. Priori]

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

Protection of Wrecks Act 1973.

Ulster Defence Regiment Act 1973.

Employment Agencies Act 1973.

Northern Ireland Constitution Act 1973.

Water Act 1973.

Social Security Act 1973.

Statute Law (Repeals) Act 1973.

Ullapool Pier Order Confirmation Act 1973.

Cromarty Firth Port Authority Order Confirmation Act 1973.

Glasgow Corporation (Parks &c.) Order Confirmation Act 1973.

Ryde Corporation Act 1973.

Southampton Corporation Act 1973.

City of London (Various Powers) Act 1973.

Medway Ports Authority Act 1973.

Queen Mary College Act 1973.

Rhondda Corporation Act 1973.

Salford Corporation Act 1973.

TREATMENT AND DUMPING OF TOXIC WASTES BILL
4.1 p.m.
Mr. Brynmor John: I beg to move,
That leave be given, to bring in a Bill to make statutory provision as to the sites upon which and the conditions subject to which toxic wastes may be deposited in, under or upon land, water or sea, and as to the treatment of such toxic wastes after or before such deposit.
The growing sophistication of chemicals in industry means that so long as we remain an industrial and technological society, and therefore an affluent society, such wastes will inevitably fall to be dealt with. We need a statutory code whereby they can be dealt with without damage to the environment. The tragedy is that before that need was appreciated too many raw toxic wastes were dumped in too many unsuitable places, thus causing potential danger which must be dealt with comprehensively by the Government. We must defuse the time bombs in our tips.
The Bill would, as its primary provision, insist that unless it was absolutely unavoidable, no toxic waste could be dumped in a raw or untreated state. Such treatment would eliminate the fire hazard in many tips and otherwise remove or reduce the toxicity of these chemicals. Incineration is the most obvious way of doing so although it is not a universal panacea. Adequate research must continue into the most suitable way of treating each chemical.
Further, only sites which are environmentally safe should be used for the dumping of toxic wastes. The present situation, in which the vast majority of sites are privately owned, the firms concerned and only a few are municipally owned calls for the following. measures.
First, all planning permissions for dumping must be referred to the relevant Government Department. I say that because although local authorities know much more than they did about toxic chemicals, they have nothing like the expertise which is available to the Government. Therefore, the Government should scrutinise all applications.
Secondly, a firm seeking planning permission should not only provide its own
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geological survey but should bear the cost of an independent survey commissioned on behalf of the local community in order to protect that community against the risks of dumping on watersheds, water courses or in porous conditions, where the danger of seeping chemicals is evident.
If there is any question of unsuitable ground—this requirement would be automatic if untreated chemicals are dumped—the Bill would require the lining of sites with an impervious layer and, as percolation owing to rainfall is obviously a prime danger, the covering of the top of the sites.
If chemicals are further degradable by organisms, that would ensure that instead of dumping as much toxic waste as possible in a small space, such dumping could be conducted in such a way as further to assist the robbery of the chemicals of their toxicity.
One of the causes of anxiety is the lack of stringent and regular testing of all sites and the lack of publicity as to the results of such tests. It is only when things are wrong that we seem to hear about the results of testing. The Bill would propose that tests for the water and the soil at sites, the health of animals grazing nearby and the fitness of produce from such animals should be regularly carried out and the results made known.
Continuing thorough research is vital to enable us to render harmless existing and new chemical waste. Powers must be taken to compel those marketing new chemicals to notify the Government of their intention to market such chemicals and of their formulae so that safe dumping of the wastes can be ensured. That can be done by further research upon the chemicals.
Too many have suffered from the irresponsibility of manufacturers who are anxious only to divest themselves of unwanted chemicals and of dumping firms who are anxious only to keep rates cheap and profits high and who have no thought of the social consequences. Loads have not always been what they were said to be. Therefore, the only way to reassure the public is to provide a local authority attendant at each site to check contents against manifest, and spot checks to ensure that the contents of drums correspond with the outer description.

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This measure is not the final answer. A public corporation with monopoly powers of waste disposal would be both simpler and safer, but in the interim a code is urgently necessary. Such a code will not cheaper the disposal of toxic waste and it will make such disposal more complex. I do not apologise for that. The simplicity of our past approach has signified negligence and indifference to the consequences. That is no longer acceptable. We welcome the fruits of modern industry but we shall no longer be its helpless slaves. A measure of this kind will be a small step towards a Britain which shows more social responsibility. I hope that the House will accept this measure.
Question put and agreed to.
Bill ordered to be brought in by Mr. Brynmor John, Mr. David Clark, Mr. Michael Cocks, Mr. Terry Davis, Mr. Peter Hardy, Mr. Neil McBride, Mr. Caerwyn Roderick, Mr. David Stoddart and Mr. Leslie Huckfield.

TREATMENT AND DUMPING OF TOXIC WASTES BILL
  TREATMENT AND DUMPING OF TOXIC WASTES
  Bill to make statutory provision as to the sites upon which and the conditions subject to which toxic wastes may be deposited in, under or upon land, water or sea, and as to the treatment of such toxic wastes after or before such deposit presented accordingly, and read the First time; to be read a Second time upon Friday 20th July and to be printed. [Bill 197.]
ORDERS OF THE DAY

  SUPPLY
  [29TH ALLOTTED DAY],—considered.
  Mr. SPEAKER proceeded, pursuant to the Order this day, to put forthwith the Question, That the total amount outstanding for the year 1973–74 be granted out of the Consolidated Fund for the purposes defined in the related Votes.

  CIVIL AND DEFENCE ESTIMATES 1973–74 (OUTSTANDING VOTES)
  Question,
  That a sum not exceeding £10,835,083,700, be granted to Her Majesty out of the Consolidated Fund to complete or defray the charges for Civil and Defence Services for the year ending on 31st March 1974.—[Mr. Higgins.]
  put and agreed to.
  Bill ordered to be brought in upon the foregoing Resolution by the Chairman of Ways and Means, the Chancellor of the Exchequer, Mr. Patrick Jenkin, Mr. Terence L. Higgins and Mr. John Nott.

  CONSOLIDATED FUND (APPROPRIATION) BILL
  Bill to apply a sum out of the Consolidated Fund to the service of the year ending on 31st March 1974, and to appropriate the supplies granted in this Session of Parliament, presented accordingly and read the First time; to be read a Second time tomorrow and to be printed [Bill 193.]

INFLATION
4.9 p.m.
Mr. Harold Wilson: I beg to move,
That this House has no confidence in the ability of Her Majesty's Government to control the rising price of food and the cost of other essentials, to maintain the value of the pound at home or abroad, and to create a fair and just society.
I should be unduly taking the time of the House if I were to attempt to quote every pledge which the right hon. Gentleman the Prime Minister made in his election campaign on inflation. But one thing which he cannot deny is that it was

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on prices, and above all food prices, on which he won the election, and nothing else. He made other promises. of course. He made promises, which turned out to be false, on industrial relations, unemployment, Market terms of entry, housing, family allowances, fares and mortgages. But what won the election was prices, prices, prices—emphasised, reiterated, highlighted, in speech after speech. There were appeals to housewives, there were radio and television political broadcasts.
Especially were food prices emphasised. I can be restrictive in the figures I quote because they are all so well known. The retail price index has already risen by 27·2 per cent. and food prices by 36+ per cent., all in less than three years. There is more to come. The latest figures are to be announced this week. There is more, yet more, to come even at a time of the year when on seasonal grounds—this has happened under successive Governments—the cost of living is usually stable or even falls, between spring and late autumn. The wholesale price index was up a whole point between May and June. It is now 27 per cent. up on a year ago—in a single year, not in three years. That still has to work its way through into the shops.
I do not think that there is need to quote more figures. No one in Britain can acquit the Prime Minister of winning power on an utterly fraudulent prospectus. There can be only two explanations. The first, which is the more charitable, is that when he made these promises he hoped in some way to fulfil them. If that were so, the charge would simply be one of incompetence. The second is more serious—that when he made them he knew that, on the policies to which he was then committed, those promises would be broken. That convicts him not so much of incompetence as of electoral deception and fraud.
In all the subsequent welter of alibis and excuses, one thing stands out. The right hon. Gentleman no longer pretends, not even about the manifesto on which he fought. After the amusing little introduction which he signed himself, the Conservative Party manifesto said:
"We have become resigned to the value of the f in our pockets or purses falling by at least one shilling a year."
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That is 5 pence in the pound in modern currency. There has not been a single year since he took office when it has fallen by as little as 5 pence in the pound, and the rate of fall is increasing again, despite the fact that we have had a freeze for about six months.
In the 12 months ended June, which included six months of statutory freeze, the increase was not 5p in the pound, it was 9·6p in the pound—not one shilling in the pound but 1s. 11d. in the pound in the old currency.
Under the present Government, 5p in the pound-5 per cent.—has become not a reproach, as the right hon. Gentleman intended, but a rate of price restraint utterly beyond his power to achieve. It was the target he announced last September in his talks with the trade unions. He has doubled it. Perhaps he can tell us whether in the 12 months following the end of his freeze he has any confidence that he can keep the increase in price right down not to 5p in the pound but to 10p?
What answer has the right hon. Gentleman for the housewives? I might remind him of what he said at Leicester in June 1970. Referring to the housewives, he said:
"We will fight on their side. We are determined to put the brake on price rises…. We did it before—we will do it again."
Putting a brake on? The trouble about the right hon. Gentleman is that he does not know his brake from his accelerator. He said that he would fight on the side of the housewives. In three years, the Prime Minister—I do not know whether he set out to do it—has broken many more trusting female hearts than Casanova did in a lifetime of dedication to their concerns. The difference with the right hon. Gentleman is that those whom Casanova betrayed at least had their memories to console them in their years of disillusionment.
All the housewives who were betrayed in 1970 have had is excuses and contrived alibis. In one month, it is the unions, and apparently this is an off month for them. In another month, it is world prices. But we heard nothing about world prices from the right hon. Gentleman in May and June 1970. What he fails to tell us is how much the cost in Britain of world commodities—food

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and raw materials—is due to his devaluation, which, at 16½ per cent., is now more than the devaluation of November 1967, on which the right hon. Gentleman so lovingly dwelt for so long.
The right hon. Gentleman does not tell us how much prices have risen in this country compared with other countries simply because of devaluation. He must have seen the chart in the Financial Times last week. This showed that, with a strong currency such as the Swiss franc, copper prices—copper is one of the raw material shave risen by about 19 per cent. over the past year, whereas the cost in sterling to British users is up by 77 per cent. The price in Japan was only up by 15 per cent. Why does he not admit that his
"Devaluation was a confession of failure, an admission that all the sacrifices of the British people over the last three years—the squeeze—the freeze—the stagnation in production, the deliberate increase in unemployment … has all been in vain. It was defeat and there is nothing for the government to be proud of in that….
"This government keeps blaming everybody except themselves."
I see that the Prime Minister looks a little perturbed because he knows that I am quoting his own devaluation broadcast in 1967. Every word of the confession of failure after three years of squeeze, freeze, stagnation in production and deliberate increase in unemployment reflects his own record.
"This Government keeps blaming everybody except themselves. Somehow they can never bring themselves to admit that they made a mistake. If they did perhaps people might respect them a bit more. And if they admitted their errors they might do something to put them right…. It really is nonsense to pretend that the decision to devalue is the consequence of a position three years ago."
But that is what the right hon. Gentleman is telling us in all his speeches—that his devaluation was due to what happened three years ago.
"And now for the immediate consequences of devaluation. What will it mean to you? Prices will rise, your bread, your meat, your tinned goods, your petrol—they'll all cost you more."
The right hon. Gentleman was prophetic.
With his new preoccupation with world prices, the right hon. Gentleman wants the country to forget the deliberate actions which the Government have taken to put prices up. It was not world prices which put up rents. It was not
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world prices which put up the rates. It was not world prices which put up bus and train fares and the prices of school meals and school milk. It was not world prices which raised prescription and dental charges and a whole host of other prices and charges in both public and private industry.
It was Government policy almost from the outset to force up prices in order to increase profits in our manufacturing industry. The Chancellor of the Exchequer will not deny that because he made it clear to financial journalists in September 1970. I hope that he will have a chance to deny it tonight if he can. The Guardian reported after his briefing:
"Tories to let prices go free."
The Daily Telegraph said:
"Price rises to rebuild working capital. Companies may raise prices with tacit Government blessing."
The Times said:
"The shortage of company liquidity is acknowledged, and it is argued that the solution lies in raising prices where this is necessary for maintaining profits, investments and working capital."
That is what the Chancellor told the Press three months after the election.
In October 1970, we had the Chancellor's interim budget. In order to make some gesture towards redeeming the Government's tax pledges he announced cuts in Government expenditure whose main effect was to put up prices. That, of course, was before the Government discovered the easy way out that they have since discovered—the prerogative of the currency debaser and coin clipper throughout the ages—cutting taxes by printing more money, a great deal of it.
Labour Chancellors of the Exchequer were reducing the public debt by budgetary surpluses. The Government are borrowing, increasing the public debt and printing money not only at a record peace time rate but at a greater rate than the Coalition Government in the Second World War.
The Government embarked from the outset on a deliberate policy of increased food prices by levies on the housewife. They restored the Corn Laws. They decided to introduce VAT, in plain defiance of the Prime Minister's repudiation on election television that VAT was

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in his programme. If the right hon. Gentleman denies that let him say so later. He said that on television a week before the election.
The Government announced a policy to force up house rents and a timetable for decontrolling the private sector. They negotiated terms of entry into the EEC, which we denounced as crippling and certain to force up prices, which is what is happening. I always wanted to know during the election—and I had some difficulty about this—what was the Prime Minister's policy for inflation. He did not tell us this in the election except for one vague phrase in "A better Tomorrow", which I repeatedly asked him to explain—in vain. The Government would, said the right hon. Gentleman, rely in dealing with inflation on what he called "general pressures", whatever that meant.
We learnt quickly enough—the most Draconian money squeeze since 1931, applied during 1970 and 1971. There were cash flow crises for thousands of firms; the disgraceful Government default on small investors' holdings in the Mersey Docks and Harbours Board; bankruptcies, including the collapse of Rolls-Royce; the creation of an investment slump from which we are only now beginning to emerge two and a half years later; lay-offs and redundancies which Inflated the dole queues to over one million.
Mr. Nicholas Ridley: Would the right hon. Gentleman not say that those conditions of slump which he is describing were due to the Budgets of 1968 and 1969 which were highly deflationary as opposed to the 1970 and 1971 Budgets which were highly inflationary?
Mr. Wilson: No. I do not, of course, agree with that. The conditions I have described were due to the cash squeeze imposed by the Government when they came into office, and the hon. Gentleman was one of the casualties of that very sad period. As so often in the history of the Tory Party, we got the wrong casualties.
Today, as always, we hear a great deal about 5 per cent. growth. Let us examine the Prime Minister's growth plan. First
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let me say there is nothing clever in achieving more rapid growth when we are recovering from a figure of 1 million unemployed, deliberately induced. Had the Government pushed the unemployment to 2 million they might be boasting about a 10 per cent. growth rate in the period which followed.
Second, in such circumstances it is particularly easy to achieve growth for a time and at a price, if one prints money by borrowing at the rate of £4,000 million a year. There are distinguished Latin American precedents in support of that. Third, it is always possible to achieve growth for a time by blithely disregarding the balance of payments. Otherwise it will not last. The Labour Government had to transform an £800 million deficit to a £650 million surplus in 1970, which the right hon. Gentleman denied in election week, and of course we set the present Government on their way to a £1,000 million surplus in 1971—but at a cost.
What we had to do meant transferring resources from home consumption to exports and investment. The right hon. Gentleman has frittered away that £1,000 mil, lion surplus. On the basis of the figures for the past four months, when we had an average of £151 million a month deficit, this would mean a current visible trade deficit of £1,800 million and a current account deficit of £1,100 million—nearly three times as bad as the bequest to us in 1964 from the right hon. Member for Barnet (Mr. Maudling). Perhaps we were too unkind to the hon. Member. His successor, the present Chancellor, is running at the moment at nearly three times as bad as that. [An HON. MEMBER: "At 1964 prices."] Of course. I take the point. With the inflation going on under this Government it is necessary to knock a little bit off.
The trouble is that a large deficit has to be paid for. This Government which preached so sanctimoniously about IMF borrowing are borrowing now to finance their deficit. Public authorities, municipalities, public industries, all are being urged to borrow abroad. I am told that the Electricity Council alone has borrowed 1,000 million dollars. I hope that the Chancellor will confirm this and tell us how much in total has been borrowed in this way this year.

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For how long can the rot be stemmed by borrowing, with the further devaluation of sterling, with the increase in European interest rates, the increase in American interest rates—always a bellwether—and the increase in other interest rates this week? For how long in conditions of a deficit can the Government hold on to the hot money attracted during the surplus with a floating currency and with interest rates abroad rising? What do the Government think will happen to interest rates here when the temporary VAT boost to company liquidity ends in a few weeks, as it must?
What will happen to building society mortgages? The building societies have already rejected the Prime Minister's appeal in this House to reduce the rates from their present all-time record level. Can they be held at 9½ per cent.? [Interruption.] The right hon. Gentleman made that appeal in this House. Can they be held at the present level? Gilt edged is at an all-time low, War Loan and Consols, the traditional test of national credit for 150 years or more, are now at their lowest ever under this Government.
The Conservative Party is now proclaimed by every traditional test as the party of unsound money. The fact is that the improvidence of the Conservative stewardship of the trade and payments balance is worsening inflation. The floating pound has not produced any easy answer. The hard law of economics means that we have to pay our way—which we did under a Labour Government.
One of the main reasons for their improvidence, for their refusal to take adequate measures to deal with prices, was the Government's obsession with the trade unions. Of course higher wages without higher productivity are an important factor in price increases. We have always said that, and it is particularly so in industries and services where wages or salary costs are a high proportion of total cost, the so-called labour-intensive industries on which I was pressing the right hon. Gentleman to produce a policy 18 months ago.
He has applied his mind to this. I think he has at various points suggested possible ways of dealing with the problem. Recent events have demonstrated that wages are not currently the main
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factor in inflation. The report of the "Rising Prices Commission", following its daily reports, shows that, with its emphasis on material costs. It attached a great deal of emphasis in its latest report to material costs. There is much more to come. The Commission has made clear how much more is in the pipeline.
It was the acquiescence, however reluctant, of the unions in accepting stage 2 which has brought it home to the country. The reluctant acquiescence of the unions in accepting stage 2 has brought right home to Downing Street the responsibility for the increase in living costs. The Prime Minister cannot blame either stage 1 or stage 2 price increases on the trade unions. During stage 1 prices rose more than earnings, with wages virtually frozen. The Prime Minister has dodged answering this week after week but he knows that it is a fact.
Hon. Gentlemen may not like to listen to this but most of them are here because of the pledges he gave and I would advise them that during the short time they will remain here they ought to listen to what has happened to those pledges.
Prices were rising during stage 1 at almost historically record rates. They have been rising, even during the freeze, faster even than in wartime. The Prime Minister has totally misled the House with his claims about real disposable income. It is no use for him to talk about the rise in real disposable income from June 1970 to last autumn. The whole purpose of his lurch in policy and the adoption of statutory wage control was to stop the continuation of the rise in real disposable income.
In stage 2 the Government's wage legislation was not working as they wanted it to work. It was working for wages but not for prices. Price control, so far as the principal components of an average households living costs are concerned, has proved a manifest farce, and the right hon. Gentleman knows it. In so far as real income was maintained in the first quarter of this year compared with the fourth quarter of last year, half of the cause of this was the increase in dividends during that quarter, dividends which are not shared among the sort of people to whom he was appealing in June 1970.

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I wonder when the Prime Minister will learn that food and housing are the main items in the family budget—that the older one is the more it is food and the younger one is the more it is housing which enters into one's household costs. But action on these is specifically ruled out by Prime Ministerial diktat, because, as the right hon. Gentleman has said more than once in the House, action on food and, as we have suggested, action on housing, would be political.
The Government have been completely wrong about the food situation. In May and June last year there was great concern about beef prices. I called and others called for a ban on the export of cattle to Europe. The then Minister, now the Lord President of the Council, went on the BBC to reply to me. He rejected the proposal and then the following week he told the House that the situation should soon be remedied as more grass-fattened cattle became available. Three months later, when those ghostly quadrupeds had come and gone—mostly to Europe, as a matter of fact—the prices were still as high. This year, the present Minister has never even tried to raise hopes by reference to grass-fed cattle.
In the last 10 weeks—the period which the right hon. Gentleman had in mind last year—there has been a 1½ per cent. reduction in beef prices in this country, the smallest reduction of any of the nine members of the Common Market. Perhaps the Prime Minister will explain that. But the export of carcase meat goes on. Beef prices are appalling and are higher than they were a year ago. If there is in due course an easement in the price of beef because of the ban imposed last week on cattle exports, it will be not because of action by the Government but because of action by this House—action taken in defiance of the Government's advice, in defiance by some hon. Members of a three-line Whip, action taken in the main for reasons related not to prices but to concern about animal welfare.
But what does the contribution of the Minister of Agriculture—I do not see him in the Chamber—to the fulfilment of the Prime Minister's election pledges to put a brake on rising prices amount to—a pathetic wringing of hands combined with exhortations to the housewives. First, he
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said that they must shop around—easy advice. What about working wives? What about wives with young children? What about wives in areas such as villages or underserved estates with only one shop?
After that we had a further ineffable contribution from the right hon. Gentleman—his exhortations to abstinence: "If the price of beef is too high, do not buy beef". That is how it started—the road to ruin. Most families could not afford to buy beef anyway, so the price fell. But that was due to the housewives' forbearance. Perhaps they wanted to buy beef for their family. They used to be able to buy it when the Labour Government were in office. Then the price of pork, lamb and even of chickens went up, so still more comprehensive restraint was required of the housewives in the Minister's appeals. All those were supposed to be boycotted. Then after that it was fish. We had all those sanctimonious speeches from the Prime Minister praising the housewives: the little woman was magnificent. What he did not realise was that families wanted to buy these things, just as they were able to do in June 1970.
When the Government finally disappear below the horizon, they will be remembered for one contribution to economics—Godber's law: if we all stopped eating altogether, the cost of living index would go down to zero. Now that branch of the PR profession which infests Downing Street and Whitehall is hard at work on stage 3. Stage 1 and stage 2 have proved to be a confidence trick. That is not in question in any part of the House. But if the Prime Minister wants to make stage 3 work he must play straight with the country. Let me repeat what he should do—I say "repeat "because we have warned him all along that a prices and incomes policy which is not fair is not workable and Britain's economic survival cannot stand a further breakdown. I say "repeat "because we told him what he must do in the debate on floating more than a year ago, in the debate on industrial relations last July, in the debate on the Address last October, in the debate on stage 1 in November and in the debate on stage 2 in January.
First, the right hon. Gentleman must rid himself of his obsessional fixations about food and about housing. He must realise that he cannot hold the cost of living unless he tackles food prices. This

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must in present circumstances mean subsidies for the principal foodstuffs—bread, meat, butter, and so on. Our right to subsidise sugar has been attacked—and we had exchanges about it today—and even now it is continued for one year only. Let us hear no more from the Government about rationing. We have rationing now—rationing by the cruel dictates of the purse in a society where the distribution of income and of wealth is daily becoming more and more distorted and inequitable.
Let us hear less sob-stuff about the fact that subsidies would have to come out of tax revenue. Of course they would. But this argument does not lie in the mouths of a Government who this April—at the height of what the right hon. Gentleman amusingly called a freeze, a standstill—blithely handed out £300 million of income after tax, take-home spendable pay, to a better-off minority which in the main was finding no difficulty in paying for its food, even beef. It does not lie in the mouths of a Government who have equally irresponsibly committed hundreds of millions—whether derived from taxation or from levies on the housewife—as a burden on our balance of payments for the purposes of keeping European and British food prices up to quibble about the use of a similar amount to keep British prices down.
Why does the right hon. Gentleman refuse to do this? Ideology, because it would be political? Perhaps. Or is he precluded by the deal which he did at President Pompidou's footstool? The price of that deal rises almost every month.
A fortnight ago I asked the right hon. Gentleman about Press reports in The Sunday Telegraph that the EEC would forbid the use of subsidies. He disclaimed any knowledge. He said that he would look into the matter. Let him answer today: does he accept or repudiate the statement attributed to "Community sources "that
"Basically the Community does not allow any direct subsidies on food"?
All that was permitted, the statement went on, were Community—wide subsidies on individual commodities.
On housing, the Government should categorically announce, as we asked them to do so before stage 1, that they will not
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enter into stage 3 with the rent increase requirements of the Housing Finance Acts in operation and that the further 50p rent levy due this October will not be extracted. The right hon. Gentleman may not have seen the first adjudication by the Rent Scrutiny Board, for an area in East Lancashire—Lees, near Oldham—where it has been laid down that the board's calculation of the ultimate fair rent may mean increases of up to 3+ times the starting rent. I hope that the right hon. Gentleman will deal with that matter today.
I also hope that the Prime Minister will announce that further decontrol of private housing rents will cease. We have seen reports that he is to propose a threshold pay formula. I do not wish to go On too long— [HON. MEMBERS: "Hear, hear."] We are all in agreement about that. The evening newspapers have asked my office how long I would speak because they are expecting a major announcement from the Prime Minister. There was some suggestion at lunchtime that the Prime Minister did not want to announce anything today but is believed to have been warned by party managers that it might be prudent for him to do something to relieve the anxieties of Government back-bench Members over rising prices before he sees them at a private meeting tomorrow evening. I hope that what I am pressing the right hon. Gentleman to announce will be announced in the next hour. Whether it will reach the Evening Standard in time, I do not know.
We have seen reports that the Prime Minister is to propose a threshold pay formula based on an index of food prices and house prices. So far as housing is concerned, he has a simple answer. Instead of taking away with his Rent Act hand something from all the families concerned and making it up in pay, why does he not stop the increase in local authority, new town and private house rents now, and do it for the duration, however long that may be?
The Government should also announce that, if there is to be any restraint in family incomes, mortgage interest rates will be reduced and then frozen. The cost of doing this will be the less if the Government will act severely to end the competitive anarchy in market interest

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rates introduced in 1971 in the last dying burst of Selsdonite freedom. We cannot deal with the problem of fair mortgage rates as long as we have that competitive anarchy in interest rates.
The Government should announce—I hope that I am helping the Prime Minister in preparing his speech—that they will take a grip on housing costs by legislation to abolish the lump system in the building industry. They should announce immediate action to deal with land speculation. They should announce a crisis tax on land and property speculation—that is to say, property already built—based on the proposals we have put forward. This should be introduced—and I give a guarantee to the Leader of the House that we will facilitate the legislation—as an interim measure before more fundamental legislation is introduced to take all potential building land into public ownership at prices close to existing use values.
This is necessary to stop the escalation of costs of both new and old houses. The latest figures published by Nationwide Building Society show that the cost of new houses has increased by exactly 100 per cent. since June 1970. There is not a single hon. Gentleman who did not fight the election on what the Prime Minister said about house prices. In the three years before June 1970 the price of new houses rose by 15 per cent. The Prime Minister will remember what he said about that. In the three years since June 1970 the price of new houses has risen by 100 per cent. Perhaps the Prime Minister will explain that today. It is all due, of course, to the Chinese wheat harvest.
We are told that the Prime Minister is now working on stage 3. We read daily of how his mind is said to be moving—no action on housing, no action even on help for the average family, merely an extension of the humiliating and restricted means-tested family income supplement.
What about the other families whom the right hon. Gentleman has betrayed by his repudiation of his election programme? During the election every hon. Member was specifically committed on family allowances. Is there any hon. Member who denies that pledge? Does
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the right hon. Gentleman deny that pledge? The Prime Minister during the election made a specific pledge in writing to the Child Poverty Action Group. His words were unequivocal. He said:
"We accept that as Mr. Macleod said in his Budget speech, the only way of tackling family poverty in the short term is to increase family allowances and operate the clawback principle… As Mr. Macleod said on 15th April, an increase of 10s. in family allowances would cost £30 million a year using the claw-back procedure."
He said that £30 million a year was all that it would cost—what we are now about to be levied by the EEC on the butter mountain. He does that blithely, but why does not he use that £30 million for the purpose of fulfilling his pledge? Is there not one among the hard-faced men on the Government benches who feels bound by the pledge that the Prime Minister gave three years ago in an attempt to win votes? I hope he will tell us today that he will now redeem his pledge.
Despite the Prime Minister's claims, the percentage increase in pensions since June 1970 is less than the percentage increase in food prices, and the gap will widen. He keeps on talking about what the pension will be in October, but why does not he increase pensions now and not wait until October? If he says that he cannot get the pension books ready before October, what about another £10 bonus? He thought of that last year. Last December he speeded up the payment of £80 million to pensioners, so that it could be paid in the week of the Sutton and Uxbridge by-elections. He has two by-elections on his hands now. Is it not fair that the old-age pensioners should receive another £10 to help him to win those by-elections?
In a few days time the right hon. Gentleman meets the TUC and the CBI. All the signs are that the talks will be directed not to food, not to housing, not to the problems of the average family, but to wages. Let me tell him. Price policy is becoming a farce. The wage policy faces breakdown, and it will break down not through strikes by workers but through strikes by employers.
All experience—our experience, American experience—proves that a tight and rigid statutory policy can be held only for a few months before anomalies and inequities between man and man destroy it

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and before such distortions wreck production and essential services. Already employers—employers making essential components, pressings or extensions for our export industries—are losing labour to factories with a higher take-home pay and are being forced to every kind of subterfuge—the sheer evasion of wage regulations, the regarding of jobs which have been established for years and are now given new descriptions to hold labour, and still more subterfuge to recruit new labour.
That has an effect not only on our production industries but also on essential services. In London and elsewhere essential services are approaching paralysis. Buses are taken off the roads, trains are marooned in depots and soon it will be the essential local authority services and the health and hospital services which will be the casualties.
The right hon. Gentleman has to work out an incomes policy as well. He has to do that against a profits background such as the one shown in this weeks edition of The Sunday Times. He will not deny the figures. The Sunday Times figures showed that profits declared over the past year are 19·7 per cent. up on the previous year. Profits declared last week—the week ending 13th July—are 49·1 per cent. upon the previous year.
The trouble is that the right hon. Gentleman is acting on a narrow but deeply sensitive area of incomes for millions of households, while ordinary people are increasingly affronted and sickened by the kind of society his Government exist to perpetuate and extend. He does not impress anyone with his cynical strictures—script writers' performances—about the unpleasant and unacceptable face of capitalism. He was referring to Lonrho, but when in the case to which he referred the unacceptable face of capitalism was enthusiastically accepted and endorsed by the card vote of the Lonrho shareholders by 29 million to five the right hon. Gentleman took no action.
So it is with land and property speculation—that is an affront not only to those who are vainly seeking a home at reasonable cost against all the economic power of a gazumping society, but to those who want to see Britain sharing wealth, sharing economic power, sharing whatever
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sacrifices have to be made and sharing them as one nation, repudiating the divided Britain into which the Prime Minister's economic and social obsessions have plunged her.
I end with this—[HON. MEMBERS: "Hear, hear."]—I can understand the hon. Gentlemen's relief. In consonance with my normal humanity, especially for hon. Gentlemen on the Government benches, I have been extremely sparing this afternoon in quoting pledges on which hon. Gentlemen were elected in the last election.
We have set out our proposals for dealing with speculation in property, in bricks and mortar and concrete where, as we have heard on television, men can boast of a profit of a quarter of a million pounds in an afternoon without adding one iota of wealth or welfare to the national patrimony. We have set out our proposals for dealing with speculation now going on in agricultural land at the expense of the independent working farmer—the seizure of a stake in still higher food prices.
The right hon. Gentleman is perpetuating, extending and even appears to be glorying in a system of society where money breeds money, paper wealth creates paper wealth, for those who already enjoy that wealth—the creation of vast financial empires, where profits are made by dealings between subsidiaries the buying power of one to create illusory values in others, so that the empire as a whole can write up its paper wealth; the sacrifice of productive industry for inordinate gains, gains which do not create wealth, or investment, or exports, or employment, but create only redundancies—gains which come from asset-stripping and the exploitation of property values in a sick society.
The Prime Minister must stand up today, not only to justify a hundred reversals of policy, a hundred betrayals of election pledges; he has to justify still more the meretricious society which is all that "The Better Tomorrow" has become. He must justify the unparalleled influence of both domestic and multi-national corporations, accountable to no authority—not even to their shareholders except in rare cases of board-room crisis—least of all accountable to the requirements of the national interest.

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Within the narrow and twisted confines of the only policies he is capable of appreciating, the right hon. Gentleman has only a limited space now in which to manoeuvre. On the real issues which dominate the society in which we live, he and his Government have forfeited any claim to lead. I call on the House to record our total lack of confidence in him and in his Government. He may today be supported by well-whipped Members elected on the same deceptive prospectus as that which created him. But, as we vote, we anticipate the emphatic vote of no confidence with which the country stands ready to condemn him, his Government and all their works.
4.52 p.m.
The Prime Minister (Mr. Edward Heath): No Government in modern times have shown themselves more ready to carry through intensive discussions about the management of the whole economy with all those concerned in it than have Her Majesty's Government. This was shown in particular in the discussions with the CBI and TUC which all parties will agree were the most concentrated which any Government have ever carried through.
This afternoon I propose to discuss some of the matters which the right hon. Gentleman the Leader of the Opposition has raised and to deal with them. He has complained of many things, and among them that 1 did not in June 1970 say anything about rising world prices. That is perfectly true, and for a very good reason. World prices were not rising in 1970. [Interruption.]
Mr. William Hamilton: You are a fraud.
The Prime Minister: That was not the problem with which the right hon. Gentleman had to deal. Indeed during his term of office of six years the commodity index of the things we have to buy from abroad was stable, whereas the rise in commodity prices that we have recently suffered is far more dramatic than anything since the Korean War.
I fully recognise that there are some people in this House, not limited to the Labour benches, who say that this is not so—they challenge the facts, but the figures are there for them to see—or they
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argue that this consideration is not important. Anybody who tries to maintain such a view must be living in a world of fantasy. Compared with a year ago we are having to pay 64 per cent. more for our copper, 89 per cent. more for our wheat, 155 per cent. more for our wool, and the Economist shows an average increase of 70 per cent, on all commodities. Allowing for the floating of the pound, obviously these are major increases in the principal commodities which we buy.
Nobody with any knowledge of the real world can lay the blame for rises of this magnitude in world prices on the floating of the pound or on the state of money supply in this country. These increases are greatly benefiting the developing world which has been yearning for them for many years, and there are hon. Members on both sides of the House who from time to time at UNCTAD and elsewhere have tried to reach reasonable arrangements which would benefit the developing world. But let us by no means underestimate the acute problems which these are now producing for the industrialised nations of the West. No critic who seeks this debate to discuss economic policy can be taken seriously if he does not first recognise this basic situation.
I should like to put a question to the right hon. Gentleman, the Leader of the Opposition. Is he saying that the increases in the world prices of raw materials, even allowing for the floating of sterling, are not to be allowed for in the system of price control which has been introduced and which is now being operated? This system of price control is the strictest this country has ever had, and it is absolutely right that increased costs of raw materials should be taken into account. But they must be strictly taken into account in applications for price increases.
I want to deal with the point raised by the right hon. Gentleman about the position of the European Community in relation to imported raw materials and foodstuffs. The estimate we previously gave to the House was that the effect of our entry into the Community would be to increase the price of food in this country by 2 per cent. in each year of the transitional period. That estimate has proved to be inaccurate this year because it is

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too high. The effect of Community membership on food prices so far this year is less than 1 per cent. This compares with an increase in the cost of food imports generally over the last year of 25 per cent. This is partly because world prices are in general far above Cornmunity prices as they apply this year in the United Kingdom.
Mr. Charles Loughlin: What about the butter mountain?
The Prime Minister: As I said in the House yesterday, soft wheat has been costing us about £50 a ton in world markets compared with the intervention price of less than £30 a ton in the Community. It is impossible in these circumstances to blame entry into Europe for the price of wheat. Similarly with beef, the market price of cattle has been over £18 a hundredweight in terms of the world price compared with the average intervention price of just over 15 in the Community. It is impossible to blame the Community for the price of our purchases in the world at large.
The estimate for future years will depend not only on the future movement of world prices but on a review of common agricultural policy which we are now helping to carry out. Therefore, it is thoroughly dishonest for anybody to pretend that the higher level of commodity prices which we are having to pay is due to our entry into the Community. The fact is that we are faced with rises of world prices such as the Labour Government never had to encounter.
There was one problem which the right hon. Gentleman during his time in office had to face, as he acknowledged today. He recognised time and again that the main cause of inflation during that period was the tendency of wages and salaries to rise faster than was justified by the state of the economy—
Mr. Harold Wilson: And profits.
The Prime Minister: If the right hon. Gentleman wishes to qualify what I am saying by one factor, he must surely outline what the other factors were. It was not profits. The share that was going to profits was depressed during Labour's tour of office. The right hon. Gentleman tried to conquer the enemy of price rises caused by excessive wage increases. He
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tried using the weapons of wage control and price control—but, above all, he tried deflation. In some respects his measures had something in common with ours. In particular he decided that it was not possible to try to control fresh food prices, even though in his situation it would have been much easier to do that than it is today. But in one vital respect this approach was entirely contrary to the one Her Majesty's Government are following. The right hon. Gentleman believed in and carried through successfully a deliberate attempt to depress the standard of living of the British people. He did it through deflation—
Mr. Wilson: The Prime Minister is doing it now.
The Prime Minister: —and we have had a lot of argument in recent weeks about the standard of living. But the argument has been about how fast the standard of living has risen in the past three years, and about whether it stopped rising temporarily in the first quarter of this year during the freeze after a long period in which it had risen rapidly. The argument six or seven years ago was not about how fast the standard of living was rising but about how fast it was falling. There was, for example, a fall in the standard of living between the first and second halves of 1966. It was a fall of 2¾ per cent. in that period alone. What the Opposition cannot deny is that, taking the six years of their Government together, the real standard of living rose by 8½ per cent. whereas in our three years—half the time—the rise is already more than 13 per cent. They cannot deny this.
There is a fundamental difference of philosophy here between the Labour Government, who tried to solve the economic problems of the country by restriction, and a Government who are certain that these problems can be solved only by bringing about a sustained increase in the rate of economic expansion. That is the policy being pursued by Her Majesty's Government. It has the full support of the TUC. It has the full support of the CBI. I believe that it has the full support of the great mass of the people of this country.
Here I want to ask the Leader of the Opposition another question. Does he support this policy of a sustained expansion of the economy or does he reject it?

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Let him say where he stands. If he supports it, is he prepared also to support the measures which have to be pursued in consequence—the demands upon the balance of payments at this stage of the expansion of the economy, the measures required to overcome any shortages of labour or skills as they emerge, and the necessity for profitability to be sufficient to cover investment for further expansion? In supporting expansion, does the right hon. Gentleman also support the consequences of it? All these are an essential part of the pattern of an expanding economy, and it is only from them that there can emerge a sustained improvement in the real standard of living of our people.
The right hon. Gentleman has again raised the question of housing. He says that I issued a diktat forbidding any action because it was political. Nothing could be further from the truth. What is more, we took action operative in stage 1 to deal with this. The difference is a very clear one of philosophy which now apparently exists between the two sides.
It was agreed in the talks with the TUC and the CBI—and it has been reaffirmed in the talks that we have just started—that one of the primary objectives was to help the lower paid. What we have done is to increase the needs allowance to ensure that those who are below average earnings receive the help that they ought to have. This was a policy which was supported by the Labour Government. It was supported especially by the right hon. Member for Coventry, East (Mr. Crossman) when he was Minister of Housing and Local Government.
Is the Leader of the Opposition saying that no matter what are the earnings of those in our higher paid industries—those, as we know, with their high earnings in the motor industry and those, as we heard in the statement the other day, in printing and getting £75 a week by day and £95 by night—they are not in a position to pay a fair rent for the housing which they occupy—
Mr. Harold Wilson Mr. Harold Wilson rose—
The Prime Minister: Is the right hon. Gentleman saying that those who are receiving pensions which we are trying to increase must also be prepared through
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the rates to support unfair rents for those who have very high earnings? That is the difference between us, and the right hon. Gentleman ought to acknowledge honestly that it is a difference of philosophy. It is not a difference of action in terms of housing.
Mr. Wilson: The right hon. Gentleman said that I misrepresented him about his refusal to deal with these matters because they were political. He will find the authority for what I said in column 630 of HANSARD for 6th November last year which sets out clearly his words on this matter.
On housing, what the right hon. Gentleman is running away from is that the cost of housing in general, even when he has made all his allowances for means testing, rent rebates and so on, has gone up very considerably whether he is talking about public authority housing, private housing, or above all about the difficulty for young couples to whom he made such an appeal in the election to find the cost of new housing, which has doubled under this administration, quite apart from mortgage difficulties. Will the right hon. Gentleman address himself to those questions?
The Prime Minister: Perhaps the right hon. Gentleman will first address himself to the point that I was making which concerned rented accommodation and the fixing of fair rents and helping those who are low paid. I asked the right hon. Gentleman to say whether he is suggesting that, no matter what are the earnings of those who occupy rented accommodation, they are not to pay fair rents but are to be subsidised by other ratepayers including those who are lower paid. That is the point at issue.
As for the cost of housing, it is widely recognised that because of the increase in savings and the way that they were used by those who had them at their disposal, the cost of private housing has risen, as have construction costs, and that what is now required is to take account of that in the way in which it is reflected in rents and in what we are doing to help the low paid.
Mr. Frank Allaun: How can the Prime Minister give this excuse of rent rebates when he knows that the great majority of tenants will get no rebate at all? How can he square

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these deliberate, unnecessary and further increases in rents coming in October for millions of families with his pretence of; struggling against the higher cost of living?
The Prime Minister: I am afraid that the hon. Gentleman is completely mistaken. I have constantly given the figures for the impact of the last increased needs allowance, which took up the figure to £35 a week, which was roughly the average industrial wage at that time. It is our policy to help through the needs allowance those who most need the help. It is a policy that we shall continue.
I ask the Leader of the Opposition not to go on repeating that no action has been taken about those occupying rented accommodation, because we have extended it to privately rented accommodation as well.
I turn now to food subsidies, with which the Leader of the Opposition dealt at some length. Here there is room for some confusion about what is being proposed from the Opposition Front Bench. On the Saturday before last the Deputy Leader of the Opposition made a speech, I think at Belper, in which he announced a specific set of measures dealing with food subsidies. I do not know what the status of those proposals can be, especially after some of the remarks today of the Leader of the Opposition. But I shall take the remarks of the Deputy Leader as being authoritative. They are very strange.
The Leader of the Opposition and his right hon. and hon. Friends have made a great deal of noise about rises in the prices of beef, lamb, fish, fruit and vegetables. In view of that, one would naturally expect the Deputy Leader of the Opposition to deal with these matters when making his speech. In fact they are wholly excluded. That may mean that the Labour Party has now recognised that if commodities which from time to time are in short supply are subsidised, the only result is to make the shortage worse. So, whatever the reason, the Labour Party apparently does not propose to subsidise any of the articles omitted from the speech of the Deputy Leader of the Opposition.
It is an extraordinary conflict that we see between the Leader of the Opposition and his Deputy—
Mr. Edward Short (Newcastle-upon-Tyne, Central)Mr. Edward Short (Newcastle-upon-Tyne, Central) rose—
The Prime Minister: Before giving way to the right hon. Gentleman, perhaps I had better finish dealing with his speech. I have some more comments to make about it. As I say, there is nothing for beef, lamb, fish, fruit and vegetables. So let us have a period of silence from the Opposition about the prices of these items. They did not deal with them in the past, and they have no intention of dealing with them in the future.
Even as recently as today the right hon. Gentleman made another contribution. In an interview today he said:
"We are now denied access to the world surplus of cheap food."
The interviewer asked,
Where is this cheap food?"
to which the right hon. Gentleman replied:
"There are many areas of cheap food."
Then, as I understand it, after a considerable pause, he said:
"There is cheap poultry in America, there are cheap pork pig products in Poland to which we do not have access."
Naturally, I inquired into this matter. The position relating to poultry in the United States is that the price now is roughly 50 per cent. higher than a year ago and is similar to the price on the United Kingdom market. Of course, it cannot be exported. If it were, we would have to put on the cost of transport.
I was also interested in pig products in Poland, so I have looked into the matter. Apparently—this has now been checked—there are no significant sources of cheap pig meat available anywhere outside the Community. As to the result of our going into the Community denying us this pig meat and it costing more, it is interesting that our charges against non-Community pig meat imports are in many cases lower than they would have been if we were still operating the tariffs that we applied before we adopted the common agricultural policy.
Mr. Edward Short: I am flattered that the right hon. Gentleman has devoted this part of his speech to my comments. I shall devote the whole of my speech to him. In my speech at Belper I said

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that I would give examples of the cost of subsidies on certain items of food. I gave the cost of subsidies at a given rate on certain items, and that is all.
The Prime Minister: Obviously that was all. Is it not strange that beef, lamb, fish, fruit and vegetables were not mentioned in the right lion. Gentleman's list? Let him stand up now and say whether he would subsidise fish, fruit and vegetables, lamb and beef.
Mr. Harold Wilson: These are the very items mentioned by the right hon. Gentleman in his speech to the housewives of Leicester. What is he going to do about them?
The Prime Minister: The same as the right hon. Gentleman. We are not going in for massive food subsidies on these items.
Perhaps I might come to the items that the Deputy Leader of the Opposition—
Mr. Wilson: Answer.
The Prime Minister: If the right hon. Gentleman stopped bellowing he might be able to hear the answer.
I want to deal with the specific products mentioned by the Deputy Leader of the Opposition. He mentioned butter, which is now considerably cheaper than a year ago and to which we are applying the Community subsidy. He mentioned cheese, margarine and cooking fats, where there has been little change over the past year. He mentioned milk, and we have held the price of milk unchanged since last August. He mentioned bacon prices, which have recently fallen by £100 a ton, and poultry, which has risen by far less than other meats. He is taking the worst possible position in going for the commodities where prices have been stable or are beginning to fall and saying that these—
Mr. Harold Wilson Mr. Harold Wilson rose—
The Prime Minister: —are the places—
Mr. Wilson: What about the price of bacon in the shops?
The Prime Minister: I am coming on to deal with the price of bacon in the shops—where he wishes to introduce a subsidy system. In order to raise
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£500 million, as the right hon. Gentleman said, it would mean an extra 45p a week off the take-home pay of the married man on £35 a week. The right hon. Gentleman talked about tax changes. The Budget of 1972 produced the biggest tax changes of all, with the £ 1 addition in the pay packet of every worker in the country for every week of the year.
The right hon. Gentleman tries to make out that this is some matter of dogma. We have used selective subsidies for sugar, potatoes and milk, which we are still doing, and for butter within the Community.
I have looked into the matter of the statement in the Daily Telegraph. That was not the Community spokesman's view; it was the newsman's interpretation of the relevant Articles of the Treaty to which he was referred. The fact that we are carrying on with action on milk and that the Community is acting on butter shows that the interpretation that he puts upon it, which was a very rigid interpretation, does not hold water.
We should not forget, when the right hon. Gentleman suggests that there is a dogmatic approach here—because those with whom we have discussions do not forget—that prices in the nationalised industries have been kept down deliberately in order to help with the prices of fuel, of power and of transport, amounting now to £300 million a year. I understand that some of my hon. Friends are critical of this aspect of the nationalised industries, but the criticism certainly does not lie in the mouths of right hon. and hon. Gentlemen opposite when that amount of money from public funds is being used to prevent increases in prices in the nationalised industries.
Those who advocate a massive system of food subsidies cannot in all honesty do so without accepting the risk of rationing for foods in short supply. If the right hon. Gentleman says it is all right for food to be rationed, is he also saying that he would prefer it to be rationed by the coupon? We should be quite plain about that. It would also mean a massive increase in taxation to deal with the major items which are sometimes mentioned, but which were not touched upon by the Deputy Leader of the Opposition. We must also make it clear that, whatever we do, this form of consumer subsidy will not affect world prices by one penny.

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I want to deal now with the other aspect raised by the right hon. Gentleman on pay and wages. Nobody has worked harder than this Government for a voluntary agreement.
Mr. Harold Wilson: When I mentioned bacon just now, the right hon. Gentleman said that he was coming to the price of bacon in the shops. He seems to have gone from bacon to pay. Will he tell us what price he is now paying for bacon in the shops compared with what he said to the housewives of Leicester?
The Prime Minister: I said that bacon is £100 a ton cheaper than it was. That is not the point at which to start subsidising it. I shall deal with bacon later.
I turn now to voluntary arrangements. We worked hard, and those who worked with us accepted our good faith. We wanted a voluntary agreement on both pay and prices. I still believe, and others concerned in the talks believe, that in a reasonable democratic society such a voluntary agreement ought to be possible.
Mr. Dennis Skinner: It is not reasonable.
The Prime Minister: We believe that in certain circumstances it could be effective. But we have learned from experience in recent years. One lesson we have learned is that it is just not possible to claim today that we could have a satisfactory policy against inflation which did not include watertight assurances that wages and salaries would be kept within acceptable bounds. This is the hard lesson that we have now learned. We should not allow ourselves to be so blinded by recent events in world commodity markets that we forget that wages and salaries are still twice as important as imports in the makeup of costs and prices. So the need for an orderly movement on pay increases will still remain when the surge in world price increases abates.
The right hon. Gentleman learned this the hard way and, as I have said, so have we. The difference between us is that the right hon. Gentleman appears to have forgotten the lesson that he learned. Any set of proposals for countering inflation which does not deal with the problem of excessive wage claims is bound to be fraudulent. What is more, it no longer has any chance of convincing the people
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of this country that it is a viable proposition. The result of the policies as they have been put forward by the Leader of the Opposition would be to pile one type of inflation on top of another—they would pile wage inflation on top of rising world prices. Because inflation stemming from world prices is to a large extent beyond our control, that is no reason for allowing wage inflation to be added to it.
Mr. Eric S. Heffer: The right hon. Gentleman is arguing against the policies which I heard him put from this side of the House when the Labour Government were in office. At that time the right hon. Gentleman argued strongly and convincingly that a wages policy was totally wrong and unnecessary, and that we did not require such a policy. Why is it that now, without any explanation for the basic change in his attitude, the right hon. Gentleman is arguing for something that he did not believe applied to the country in 1970?
The Prime Minister: I have repeated that I believe it ought to be possible to get a voluntary policy. We still believe that in a reasonable democratic society such a voluntary agreement ought to be possible, and we believe that in certain circumstances it could be effective. When we failed to achieve such a voluntary policy, I told the House quite openly that we were going to move to statutory control.
We are now continuing talks with the objective of finding a voluntary policy, but the point that I wish to make—and I shall repeat in because of its importance—is that any set of proposals for counter-inflation must have an absolutely watertight arrangement so that wages and incomes cannot rise excessively.
Mr. Roy Jenkins: The right hon. Gentleman said that he and the Government had learned the hard way. Is the right hon. Gentleman saying that if he had had the knowledge and experience that he now has of the effect of incomes on prices and the movement of world prices he would not have made the statement which he made to the country and which formed the core of the political issue in the election of 1970?
The Prime Minister: With respect, it did not form the core. This matter had

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been discussed in Parliament for many years before that. I adhere to the belief that I have stated today, and we shall work in this present lot of talks for a voluntary agreement. If there can be a watertight arrangement it can be accepted.
We cannot affect world prices by shifting money from the pocket of the taxpayer to that of the consumer, but we can maintain the expansion of the economy and control our costs so that we are competitive in world markets. Then we can earn through our growth of exports the higher prices that we have to pay for our imports, and then, too, we shall have a stronger pound, and that in its turn will reduce the domestic price of our imports.
The House knows that we are going into further meetings with the TUC on 27th July and the CBI on 30th July. We have already agreed on specific subjects for discussion at these meetings. The work is being done by all three parties to the talks in preparation for them. We shall then want to extend the talks to cover further matters of wider interest as we prepare the ground for stage 3 of the counter-inflation programme.
By 15th September at the latest we shall have the report of the Pay Board on anomalies. It is because we have learned from the right hon. Gentleman's experience of operating a policy of this kind that we have arranged to deal with anomalies in a rational and orderly fashion. This has been welcomed by both employers and unions, and it is something that was lacking before. Then we shall be able to look at the economic outlook in preparation for stage 3.
I believe that in the course of the last year we have made two important steps forward in dealing with inflation. First, we have expanded the economy steadily at a substantial rate. Secondly, as a nation we have accepted the truth that excessive pay increases can lead only to higher inflation. What we have to do now is to build upon that and, indeed, to improve the arrangements that we have made, which we can do during these discussions, both on the pay and the prices side.
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It is obviously too early, and it would not be right before other parties have contributed to the discussion, to say what shape stage 3 will take. That will obviously depend on the proposals upon which they themselves are working, but I hope—indeed, I believe that it is essential—that the arrangements that we achieve will make allowance for increased flexibility. I am quite clear that most trade union leaders and, indeed, the British people do not want to return to a position where they feel that there is a free-for-all, with no protection against prices being pushed up, and the economically weaker section of the community going to the wall. That is their view.
The right hon. Gentleman also touched on the fact that there are supposed to be these large numbers of people moving about and defying the arrangements. That is not our experience. I have inquired about this from the Department of Employment, and I am told that there has been no major change in movements during stage 2. There may be individual examples, but there is no general evidence of a movement of the kind referred to by the right hon. Gentleman. But this is one matter that must be watched carefully, and I hope that there will be flexibility in stage 3.
Subject to that, I want to say more about the Government's approach to pay and prices. First, it is true that earnings have gone up a great deal faster than prices. From June 1970 to April 1973 prices rose by just over 26 per cent., while average earnings rose by just under 38 per cent. The rapid expansion of the economy itself has given many people the opportunity to increase their earnings, quite apart from the level of their basic wage or salary, and we have concentrated by agreement on the position of the lower paid.
Nevertheless, there is a risk that the lower paid in particular may not be properly protected at a time when world prices are rising exceptionally rapidly. That is the point that the TUC has made to us with great force in relation to both workers and pensioners, and it is entirely legitimate that it should do so.
We have been able to safeguard the position of the pensioner in this respect. The right hon. Gentleman has taken to comparing increases in the food index

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with the total amount of increase in pensioners' incomes. It is well known that the percentage of a pensioner's income spent on food is higher than that of the average in the nation, but I doubt whether it is more than 40 per cent. which is the usual figure that is given, and therefore the comparison ought to be like with like, which is the total index against the total increase in the pension.
By the time the next pension increase is paid in October, pensions will have gone up by 55p in the pound since November 1969, compared with a rise in the cost of living of 33½ per cent. since then, and that leaves out of account the bonus to which the right hon. Gentleman referred. It also leaves out of account the fact that pensions are increased every year and the fact that under this Government, for the first time thousands of very old people are now receiving pensions.
With regard to wage and salary earners, we allowed for a substantial increase in stage 2, averaging 7 per cent. to 8 per cent. These were below the very large increases made before the standstill, which have meanwhile been working through into prices. That was inevitable. Since November of last year the retail price index has risen by just over 5 per cent., but earnings have risen faster than prices compared with a year ago. The April earnings figure showed a rise in earnings of 13·4 per cent. on a year earlier, compared with an increase of 9·2 per cent. in prices. I can tell the House that the May figure of earnings which is to be published this afternoon shows a larger margin in favour of earnings. It is clear, therefore, that the earnings index in May was once again rising faster than prices, and in an expanding economy one expects that people's earnings should be increasing substantially and steadily.
We can handle the complexities of these problems in a number of different ways. We can take special measures to deal with prices through the Price Commission. We can help selectively with certain foodstuffs, as I have already mentioned. We can help particular groups in the community who are especially vulnerable to price rises. All these are matters for further discussion with the TUC and the CBI, and then action.
At the same time we have to make arrangements for the period following
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stage 2. We want these to be known to all those working in industry in good time for their future planning.
We believe that we can help here by working out a procedure for safeguarding the improvement in the real standard of living which we all wish to see. But taking all of these different aspects together—and this is a matter of balance, to be discussed with those concerned as well as in the House—together they must not amount to more than the expanding economy can stand.
There are those who put to us, quite rightly, the view that rather than having a pension which is improving steadily in real terms there ought to be a jacking up, to make it comparable with the level in European countries or elsewhere. That is an example of matters which can all be discussed and considered. But it has to be recognised that in doing this one is making real demands on resources in this country, and together with the other action we are taking on incomes and salaries it must not exceed the expanding economy.
In the past two years we have done a great deal of work on the kind of safeguard which could be adopted, and one method of safeguarding pay increases against uncertain prospects for prices is what is known, as the House well understands, as threshold agreements. We all know how uncertain forecasts are, especially when they have to cover movements of world prices. The quality of threshold agreements is that they provide a firm reassurance which could only otherwise be provided by pressing for a much higher settlement. If prices rise above a certain fixed amount, then the agreement is triggered. An addition to pay is automatically provided to protect the real value of earnings which was intended in the settlement.
The Government put forward the possibility of providing for such agreements in the talks last autumn with the TUC and the CBI. At that time there was no detailed discussion, although work had been done in the NEDC, and there was not great interest in the concept. We have now concluded, as a Government, that we should positively propose to our partners in the talks about stage 3 that this type of agreement should be allowed for as a part of the machinery, because its value in preventing anxiety about the

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erosion of wage settlements will be very great. It should conduce to orderly negotiation and to industrial peace.
It is right that the level of the safeguard and the exact means of negotiating it should be discussed in future meetings with the TUC and the CBI, unions and employers, who are concerned with negotiation. The details can be settled in the light of the circumstances in the autumn. When the Counter Inflation Bill went through the House we understood. consult opinion in this House about the proposals.
Secondly, on prices, of course the machinery concentrates attention on individual price increases. But it is right to look at what this amounts to. In May—the latest month for which the prices figure is available—the increase in the retail price index for foods manufactured in the United Kingdom was 0·2 per cent.
Mr. Skinner: Tell that to the battered housewives.
The Prime Minister: As I told the House yesterday, since the standstill was introduced in November 1972, overall, these manufactured foods have fallen by 0·2 per cent., despite the very rapid increase in the price of raw materials over this period.
I should have thought it right to pay tribute to the food manufacturers for this, because their record is hardly consistent with the image of people who are concerned to extract every price increase which the code allows.
It is also right to look at what does not go through. The code does not permit all cost increases to be passed on in prices. There is a productivity deduction which means that manufacturers have to absorb no less than half of the increase in their labour costs. But I say to some of my hon. Friends that there is sufficient productivity increase retained to give an incentive to further production and to investment. Nearly two-thirds of all applications made and half of those on manufactured foods have been rejected. withdrawn or modified.
Anyone who thinks that this is a farce—as the right hon. Gentleman has said, following an earlier speaker outside the House—ought to take into consideration the Price Commission's own comment
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that in the first two months it has saved the consumer £44 million a year purely on the applications that it has considered from the companies which have referred them to it, completely ignoring other groups outside who are governing their prices accordingly.
For stage 3 we shall look at the price code again and at its operation, and we are fully prepared to consider comments on it. But there are ways in which we can make further use of the existing code, as the Price Commission's staff grows and as it gets past the first rush of applications with all the additional work which the establishment of the new machinery brought.
The Chairman of the Commission is now undertaking a three-point plan for action in addition to what has already been done. The Commission has been preoccupied so far with the largest companies. It is now starting to deal with the medium-sized companies, which are bound to report their price increases and profit margins. Where the check on the information coming in reveals that price increases have been made which are not justified, the Government will support the Price Commission in having them rolled back.
Secondly, the code prohibits increases where the result would be to increase companies' profit margins above the level in the reference years. and indeed, may require reductions. This provision has already prevented some price applications from companies in the top category from going through and has resulted in others being cut down. The Commission will now take all the steps that it can to ensure that all firms are aware of this provision of the code. This again is another aspect which will be covered by the Commission in checks on the smaller companies.
At this stage of expansion some recovery of profits is to be expected. Again, that has been criticised by the right hon. Gentleman. Let me give the House the figures. After deducting stock appreciation, the share of gross trading profits in total domestic income was 11 per cent. in the six months to the end of March. From that all investment has to come. For the 1960s as a whole, including the right hon. Gentleman's administration, the average was 13·8 per cent. The present percentage, therefore, shows low

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profitability compared with the decade during which the right hon. Gentleman was in office for six years
Thirdly, the Commission, through its regional organisation, is starting a programme of checks on retail and service establishments. In addition, the regional offices have embarked upon test inquiries to find out whether the big fall in wholesale bacon prices has been effectively reflected in the retail shops, and to ensure that it is. Inquiries of this kind are to be carried through and extended by the Commission. This is a programme for intensifying the activities of the Price Commission in the immediate future.
I have made these points because they are put to us in the discussions which we have with the TUC and the CBI, and it is right that they should be made in public. But there are some in the talks who demand that every price in every shop up and down the land should be controlled. I see nods of agreement. That is an impossible proposition. It cannot be. But the Government will support a further campaign to give the housewife information about what she should expect to be paying, especially in the sector of foodstuffs.
Mr. Peter Shore: This is all very interesting, but will the right hon. Gentleman say whether he expects, in the year ahead, that the rate of inflation, as a result of all these checks, will be held or will be less than the rate at which it is now running, which is 9 per cent. or more? Secondly, as the right hon. Gentleman is covering everything except the most important problem that the nation is facing, will he say what he intends to do about our catastrophic balance-of-payments problem?
The Prime Minister: The right hon. Gentleman well knows that forecasts of that kind are not made publicly. But concerning the balance of payments, if the Labour Party is supporting a policy of expanding the economy, it must be prepared to accept the consequences of the import of raw materials and, in many cases, plant necessary for the expansion of the economy until the exports themselves meet the imports. Export expansion has been very considerable. We are export led. At the same time we must expect that the replacement of stocks and the import of materials and plant
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for an expansion of this size must be borne on the balance of payments.
Mr. Skinner: Now that we have got to the most important matter, namely the economic factors and the economy generally, would the Prime Minister give me the approximate date of the autumn Budget so that I can put it in my diary, and be ready for it?
The Prime Minister: We have agreed on the objectives which we will work for to sustain economic growth, check the rate of inflation and help the low-paid and pensioners. Any further steps we can take will depend crucially on the nature of the agreement which we can achieve.
The CBI and the TUC naturally press the interests of their members but all of us in the talks have a larger responsibility to the people of this country to recognise that our common interests are greater than our differences. We must ensure that the differences do not reach the point at which the impetus of national progress is hindered or disrupted which would be in the interests of no one trade unionists, employers or any other citizens. The responsibility of the Government goes wider than prices and wages. Throughout we have sought to ensure that the weak are protected and that the most effective use is made of the money available for that purpose.
Throughout we have sought to ensure that our overseas policies are such that we can trade widely and exercise influence effectively in the circumstances of the latter half of the 20th century. Above all, we have recognised that we cannot ask industry to be positive and farsighted in its investment decisions unless the Government are also positive and farsighted in providing the services which will be required in 10 or 15 years time.
I look at the Opposition's motion and consider the situation in which we now have steady economic expansion which can be sustained and is export led. I see consumer demand levelling out and investment increasing, unemployment substantially decreasing and regional regeneration taking place as a result of the policies we are pursuing; and when I see that stage 1 and stage 2 have been successfully and peacefully implemented, and that there has been a major reduction in working days lost in industry,

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I recognise that we have an opportunity to move into stage 3, to deal with anomalies in an orderly fashion and to secure an improvement in the real standard of living.
I take into account in this process that those groups in the community most needing protection can receive it. These achievements require above all a continued expansion from which everyone can benefit. We need to make better use of our resources, especially during the coming 18 months, before the investment which is carried through can be operative. This requires us not merely to overcome any suggestion that because difficulties may arise in certain sectors of industry expansion should be brought to a halt, but renewed ingenuity in dealing with these problems, whether on the shop floor or elsewhere, and whether this requires the work of management or of unions.
I believe that many union leaders today want to see a new approach to these matters. They want a better relationship on the shop floor, and it is for management to respond to this. We can discuss this framework not only among ourselves in this House but in the European context of what the future organisation of industry will be from the point of view of worker participation. Within it we can secure better human relationships and the breaking down of class barriers. We all know plants where this has already been done. We also know how much more progress still requires to be made. This, again, cannot be done by one side alone. This is the way to achieve a just and fair society—not an equal society, which is never attainable but a just and fair one, because of the work of the partners in industry.
Mr. Tam Dalyell: Some hon. Members will recall that during Question Time the Secretary of State for Scotland said that if the European Trade Mark Centre were to come to the United Kingdom it would be in London. This is more important than the European Patent Office. Why does it have to be in London? Are all European agencies to be in London?
The Prime Minister: That matter can be discussed on another occasion.
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What are the Opposition's proposals to deal with these problems, or to produce a fairer and more just society? Their proposals are the blight of further nationalisation or the abandonment of other things for which they stood when in office. We have extended the system of fair rents and given help to those who could not afford them. Fair rents was a principle introduced by the right hon. Gentleman and his friends, but they have now run away from it. We have negotiated Britain's entry into the European Economic Community. This was a policy of the right hon. Gentleman and his colleagues, but now they have run away from it. We are going ahead with providing for Britain massive investment to meet the needs of the future. These massive schemes are projects from which the right hon. Gentleman and his colleagues have continually run away. They cannot agree on any realistic policies directed to the needs of modern Britain, despite their working committees and 70,000 words, we are now told, or perhaps because of the 70,000 words.
They are led by a man who, unlike the famous Duke, does not even lead from behind but leads by abstaining. This is the party and that is the man who have introduced a motion of no confidence in Her Majesty's Government. I ask the House decisively to reject it.
5.47 p.m.
Miss Betty Boothroyd: It is never very easy to make a maiden speech in this House, but it can be particularly difficult to follow a Prime Minister. But I hope that the House will be tolerant with me this afternoon.
I speak today as the Member for West Bromwich, well aware that my predecessor, Maurice Foley, was a respected Member of this House and a Minister with special responsibility for immigration and race relations in a former Government, I well know the stand he took on this issue, both in the constituency and nationally. He is a man intolerant of injustice in all its forms and with the ability to apply in a practical manner his sense of decency and fair play.
As a first-hand witness, I recall his integrity in dealing with those who seek to excite the most violent and irrational emotions because they believe that to be anti-colour and to be anti-immigrant

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is to court popularity. Today, Maurice Foley is an international civil servant, responsible for associating the developing world with the developed world of Western Europe, a job that he is particularly well-experienced and well-equipped to perform.
My roots are working class and I have earned my living since the age of 17. Therefore, I claim to be able at any rate to speak for ordinary working people. This, reinforced by recent support of the electorate, might, I hope, help to balance in some way my lack of parliamentary experience. But I am proud to be the Member for West Bromwich, sent here in the main by people who earn their living in industry—in foundries, rolling mills, in factories, making components for motor cars and aircraft and a variety of engineering products—industries which secured for Britain her formal industrial power and which today ensure her economic survival.
West Bromwich's Victorian town hall has an elaborate ceiling cast by the iron masters of old and the borough has a prizewinning brass band. Having been brought up in Yorkshire's West Riding I need no converting to industrial people. They are my kind of folk.
I am sure that politicians and parties must give a lead, but they must also turn a sensitive ear to the views of constituents. I hope that it will interest the House if I mention just two major issues which concern my constituents. The first without doubt is that of inflation. The second is a strong feeling they have about injustice in our national life today.
Earlier today there was a heated argument about land and homes. In West Bromwich in June 1970 the price of a plot of land for an average house was £1,500. Today it is double that. Building society figures show that the average price of a new house in the Midlands was £4,800 in June 1970. Today it is £8,200. In June 1970 monthly mortgage payments were £34. Today they are nearly twice that figure. A family needs a large income to meet these demands.
I turn, secondly, to the justifiable complaints of my constituents about the rocketing price of food which has worn out the elasticity of their wage packets. For three weeks we monitored prices in West Bromwich. Every other day we
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carried out a survey of retail prices in the high street. We found that even in one week many essential items had crept up in price, some by one penny, some by more.
No wonder the cost of living was the talking point. No wonder I was constantly asked, "When will something be done about it? "One suggestion we made was that local authorities should be given powers to monitor prices locally and to tackle abuses locally. Having abandoned the Consumer Council some three years ago. I hope that the Government's new proposals for consumer centres will be given teeth and powers to protect the consumer as well as to advise the consumer.
It was no comfort to my constituents to learn that only a week after I had taken my seat in the House the Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food told the House, in answer to a Question, that during the period of this Government on the latest figures available families have had to pay an extra 49p every week of food for every person in the family. This does not include essential household items. It is 49p per person, per week on food alone.
Hon. Members will recall, as I do, that nationally organised band of women known as the Housewives League. They campaigned dutifully in the late 1940s objecting because ration books were still required for essential foods. Where are the daughters of the consumer revolution now that we have rationing by the purse?
It can hardly be made more obvious to the Government that people want convincing action to protect them from rising prices. The Chancellor added to their general hardship in his April Budget, and he can now help to put that right. I was disappointed to learn today that there is to be no increase in family allowances. This matter could be put right by increasing family allowances and by granting an allowance for the first child. This is one of the fastest methods possible of getting help to those in need.
Secondly, under phase 3 the level of pay rises must be related directly to the cost of food and other essentials. This threshold method of increases would help all wage earners, those with families and

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those without children, and it could be extended to cover pensioners.
Thirdly, in improving the common agricultural policy the Government must ensure that major changes are made to reduce the glut of dairy produce. I know that it is not easy. The emphasis must be on the growing demand for protein foods such as beef and pigmeat. The important thing here is that the Government must take an initiative. It is not enough merely to negotiate on the proposals of other member nations. I mentioned earlier that politicians must listen, but they must also give a lead in these matters.
I turn next to pensioners. At a time of rapid inflation they, too, need rapid help. In West Bromwich we are blessed with a social services department which is second to none. We have people who give their time and their energies to clubs for the over-60s. Were it not for those men and women, many of our elderly would find loneliness a final burden in their struggle for existence. In far too many cases they do not have a life, but a struggle for existence against the odds. There was disappointment that the Budget which gave relief to surtax payers did nothing to recognise the pressing needs of the elderly. With spiralling prices and with the pound rapidly falling the October increase is already overtaken. In my family we would say in such circumstances, "It has got its coat and hat on before it is over the doorstep."
Why is it not possible for an immediate increase to be given to cushion the effects of inflation? Why is it not possible for those who produce their pension books at their regular post office to get an increase in benefit from August onwards? If it is argued that it is administratively impossible to cope with the paper work, we have only to look at previous years. In 1955 and 1964 pension increases were given within a matter of a few weeks. Surely with modern management methods and with computers it is possible to do that in 1973. Why must the pensioners wait until October?
May I finally turn, briefly, to the question of our national life. The firm impression that I carry from the West Bromwich by-election is the dissatisfaction that people feel that our society
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is unjust and unfair, that we live by the rule of law but that there is one law for the well off and another for those who are not so well off.
It is difficult for me to articulate their feelings, but I shall try. Allow me to put it like this: have the Government a right to be listened to in their appeal for wage restraints when we have only to look at the financial pages of the national Press to see that company profits are rapidly increasing? Have the Government the right to be listened to by families seeking homes when rents are deliberately increased and when the property speculator is elevated to the top of our society? Have the Government the right to be listened to by hard-hit families when measures to protect their interests are rejected?
The Government were not elected constantly to explain away the problems of world conditions, world prices or the actions of primary producers. They were elected to find the answers. There can be no real progress until everyone realises that we have a two-tier society and that until practical steps are taken to alleviate its injustices people everywhere will feel badly about this Government which were elected on false promises. I thank the House for listening to me so tolerantly.
6.0 p.m.
Sir Henry d'Avigdor-Goldsmid: Perhaps it is not out of place for a fellow Black Country member to welcome to this House the hon. Member for West Bromwich (Miss Boothroyd) on making her maiden contribution. There used to be a tradition, which I am glad to see is disappearing, that maiden speeches were non-controversial. It was an unhealthy tradition and I am glad to see that the hon. Member would have no part in it.
I am sure, however, that she will forgive me if I do not take up too closely the points that she made. Suffice to say that I understand, and perhaps I am quoting her wrongly, that she announced her return to these corridors which she has for so long decorated by saying that she had been permitted to enter the executive too. I do not know whether that is correct, but I can assure her that we should like to see her in all the executives seats, including the Front Bench.

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I should like to comment on the speech of the Leader of the Opposition, notwithstanding his absence, because he gave us a most apt and convincing illustration of how we should win the last war. I do not think there was a single thing in his speech which would have been particularly out of place if uttered by some great radical leader of 50 years ago. He left me with a feeling that I was listening to the great days of radicalism in this country.
However, times have changed. In military terms the right hon. Gentleman was leading the Polish cavalry against the German tanks. He was most gallant and brave but not altogether convincing and he was not likely to win the war. I remember a former Serjeant at Arms, Brigadier General Howard, who won a great reputation for gallantry in the First World War by constantly exposing himself to fire in order to encourage his men. We could give the right hon. Gentleman a medal for gallantry. He exposed himself to fire on five or six occasion, not very convincingly, but at least he was there and showed himself.
However the war we are fighting is now different. We are not fighting the war of 1870 or even of 1970. We are faced with an entirely different situation. When Vesuvius erupted the citizens of Pompeii were probably discussing plans for a new public baths. No doubt that was a matter of great moment to them, but they were completely unconscious of the deluge of death and destruction that was about to descend upon them. That was the position today. We are facing what amounts to an eruption of Vesuvius. Price inflation all over the world in the last 18 months is something which will bring much of the Western world as we know it to an end. Attribute the blame where we may, but the Western world has been doing what mediaeval kings used to do. They used to sweat their currency—reduce its value by reducing its weight. This is what the Western world has been doing for a number of years. Led by the United States it has issued paper in return for the commodies it wanted. Now most of the rest of the world, particularly the third world, is no longer willing to accept the devalued paper of the West.
We seem to be playing the old nursery game of Slippery Anne. It was a card game in which the object of the player
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was to pass this unhappy card—the queen of spades or Slippery Anne—on to a neighbour. The idea was not to keep it for any longer than was necessary. The Slippery Anne in this case is the paper currency of the West. The East does not want it any more. It wants it only for what it can buy. One of the reasons for the inflation we face is that the Western currencies no longer have the purchasing power that they had vis-à-vis the raw material producing countries.
We must try to find a means of fighting not the Boer War or even the 1914–18 War but the economic war before us. Our view is that a constant rise in productivity is likely to be the right answer, but it is dangerous. It does not appeal immediately, and we must take the population with us. That is the most important factor. An attempt to say that there is no danger, which is what 1 detected from the Leader of the Opposition, and that all we have to do is to pretend that there is no danger and it will disappear, is not a productive policy, nor one that should be commended to the party that seeks to describe itself as an alternative Government.
In a speech after the Budget I recommended my right hon. Friend the Chancellor to consider the possibility of index-linked borrowing. I still believe that that strategem should appeal to him. It would put his money where his voice is. The issues of stock which were made with such éclat after the Budget have not been particularly successful in attracting funds from the public.
When Sainsburys, that eminent firm, made a public issue of shares, "only "about £500 million was put up in applications. That does not suggest that any of the banks emptied their tills to apply for Sainsbury's shares. It shows the vast amounts of short-term money sitting in London because investors do not feel sufficient confidence to invest it in the gilt-edged market or in industry. The very existence of those amounts adds fuel to the fire of lack of confidence.
Therefore, I suggest that the Governor of the Bank of England, to whom we all wish well, should look at the amount of short-term money sitting here and take steps to take some back by demanding special deposits. It is a well-known practice. It does not affect the permanent supply of money but just prevents the

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exaggeration due to an excess of floating money.
I could not help noticing that on the same day as the Governor went to Basle one of the largest banks in the country invested no less than £100 million in a property transaction, which had the effect of putting £100 million into circulation. It is no good our preaching to our friends and neighbours the qualities of thrift and good housekeeping if we behave in this reckless way.
When I speak of behaving recklessly, I think, too, of Rowntrees, which has managed to lose no less than £20 million in speculation in the cocoa market. It does not have to speculate in cocoa. It is the biggest consumer of cocoa in the country. I believe that beyond a peradventure of doubt it is looked upon around the market as naturally good for its engagements and as having a level judgment. That such a firm should lose that sort of money suggests complete lack of supervision and a feeling that money is becoming confetti. That is a matter well within the Bank of England's power to bring to an end. If people think that money is confetti, they will spend it like confetti and expect it to fall from the sky like snow.
There is complete woolliness on the Government's expenditure programmes. This year we had the May reductions in the Estimates, but I believe that in practice the only project which has been brought to an end this year is the new House of Commons building. I do not think that any other project has been curtailed or stopped because of the announcement by my right hon. Friend the Chancellor in May.
It has been explained honestly and honourably by the Treasury that accuracy in estimating is almost impossible. Most Departments are optimistic about their estimates, and therefore they can cut £500 million out of the expenditure Estimates without affecting the revenue side, because that amount would have proved to be under-spending at the end of the year. It is a form of sloppiness which the House should not tolerate. I see my right hon. Friend the Chief Secretary looking up, but these words will be substantiated in print all too soon. Therefore, I shall say no more about that.
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I do not believe that anyone can tell us what our commitments and expenditure on the road programme are. The matter is a riddle, and none of us is in a position to answer it. Government expenditure grows imperceptibly through optimistic estimating and under-spending, and there is no limit to it. Just as Government spending cannot be activated upwards to act immediately, except on the social side, it cannot be conveniently cut, because nothing concrete seems to emerge.
It is clear that there will be a shortfall in Government expenditure, because certain industries are definitely overheating. One is the building industry, in which there are already shortages of gypsum, bricks and steel, all affecting the construction industry and all in the long run affecting the expenditures of the nationalised industries. These are known facts. We know that there will be a shortfall on current estimates, whatever they are.
Our problem is that there is becoming a separation in Britain not between employers and employees but between employees and their union leaders. Union leaders now are not always regarded as acting in the best interests—,I do not say rightly or wrongly—of those who they are supposed to look after.
In a company with which I am connected I found great difficulty in persuading employees to join the union. They show no willingness to do so. They are frightened that they will be taken out of their jobs because of disputes in which they are not remotely involved. I do not invent that. We know that this is what happens.
There are more people in Britain who get reasonable job satisfaction from what they are doing than there has ever been before. The majority of those who are employed would like to get on with their jobs. They want to be allowed to get on with them. They see a reasonable fairness in the plans which the Government are putting before them. I only hope that my right hon. and hon. Friends will remember that the people are not all engaged in sabotage. Most British people like their work and would like to be allowed to get on with it.
6.17 p.m.
Mr. Douglas Jay: The country will be extremely disappointed by the Prime Minister's speech. He announced no new measures which the Government propose to take. The Prime Minister has never explained why, if the level of prices is totally outside his control and the Government's control, he promised in 1970 that he would be able to bring prices down. We still have that question unanswered.
It is now becoming possible to check by hard experience who was right in some of the arguments which we have had during the past three years in this House about the effect on prices of joining the EEC. Some of us predicted that membership would mean a rise of approximately 50 per cent. in retail food prices, a widening trade deficit with the rest of the EEC, and an overall current balance of payments approaching £1,000 million a year. Ministers denied those suggestions.
It is now a matter of hard fact that retail food prices have risen 36 per cent. since the negotiations started, that the United Kingdom is now running a trade deficit with the rest of the EEC of nearly £80 million a month—compared with a negligible deficit three years ago—and an overall current balance of payments deficit of at least £800 million a year.
Those who said that none of those things would happen now tell us that they have nothing whatever to do with the EEC or the common agricultural policy. That is an attempt to deceive the public which will be singularly unsuccessful. We live, of course, in a temporary period, which probably will not last very much longer, of rising world prices. But in such a period any sane Government would surely do everything possible to keep prices down and not to take action which pushes up prices even further. In fact, the Government's complete surrender to all the absurdities of the common agricultural policy has been a major cause of the present unnecessarily high level of food prices.
Since the beginning of this year the Government, at the behest of Brussels and not for any sensible economic reason, have been raising food prices. The Minister of Agriculture, Fisheries and Food said on 21st February:
"We are raising British prices towards Community price levels over a five-year period."
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—[OFFICIAL REPORT, 21st February 1973; Vol. 850, c. 478.]
We heard nothing about that from the Prime Minister today. His own Minister, in the same month, whilst addressing some farmers in Norfolk, told us vividly and candidly how that will be done with butter prices. The Minister said:
"We start the transition with a low intervention price reflecting the low market price in Britain of £357 a ton. The full Community price is £837 a ton. We divide the difference by six to give the amount of the increase which we make on 1st April each year."
I understand that so far the intervention price has gone up to £403 a ton.
The Government are using two instruments to force up food prices in that way. First, there is the imposition of a series of import taxes and levies. Secondly, there is the operation of the Intervention Board in taking food stocks off the market and denaturing them to make them unfit for human consumption.
The Government—we did not hear a word about this from the Prime Minister—have imposed in the past few years the most sweeping series of import taxes on food which has been borne by the British people for generations past. When I hear so much about food subsidies I often wonder how many hon. Members realise the extent of the food import taxes imposed by Britain in the past two years. According to the information given to me by the Minister of Agriculture, Fisheries and Food on 14th June, in answer to a Question, import taxes or levies are now being imposed on the following foods: mutton, lamb, poultry, beef, eggs, bacon, pork, fish, butter, cheese, fruit, vegetables, canned fruit, cereals, cereal products, lard and sugar. We are now threatened with a tax in the autumn on beef.
Mrs. Renée Short: Disgusting.
Mr. Jay: Some of the taxes are extremely heavy. It is no good pretending that they are trivial. The import levy on butter is now £163 a ton. That is a tax of approximately 40 per cent. at existing world prices. That tax has already virtually shut out all Australian butter from the British market. The levy on cheese is £220 a ton. That has shut out all Canadian cheese. It is no wonder that prices are rising in these circumstances.

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But price raising through import taxes is not enough for the Government to satisfy the Brussels authorities. They have also set up the Intervention Board, whose sole purpose is to keep food prices up by buying up stocks and by paying traders to
"withhold stocks from the market …"
and by "denaturing incentives".
I am quoting from Class V, Vote 12 of the Government's Revised Estimates which were issued on 2nd July. These Estimates show that in the present financial year the Intervention Board proposes to spend £55 million, not in bringing food prices down but in keeping them up. According to the Estimates the board this year is to spend £44 million gross and £15 million net on intervention buying so as to keep prices up. It will spend £151 million gross on intervention buying of cereals. It will spend £71 million on skimmed milk powder and £17 million on butter. Perhaps the Government will explain why it is necessary to spend £17 million on taking butter off the market at the present price and, incidentally, what is going to happen to the butter.
On top of this, the board is to spend another £40 million on
"payments to private storers for withholding stocks from the market"
—this is stated in the Revised Estimates, on page 2—and on "denaturing incentives". About £4½ million is to be paid to traders to withhold from the market stocks of butter, sugar, meat and cereals. Most remarkable of all, an additional £22 million is to be spent on denaturing incentives—in plainer English, paying people to make food, presumably mainly cereals, unfit for human consumption.
At Question Time, periodically, the Minister of State feebly attempts to pretend that the Government are only denaturing wheat in order to produce more feedingstuffs for animals. As he knows, that is humbug, because animals, strangely enough, are perfectly content to eat undenatured wheat. The sole purpose is to keep up the price of wheat for home consumption. The Minister has now made arrangements even for beef to be "sold into intervention", as he calls it, although I presume that he has not yet actually done so.
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While, therefore, the Government talk about subsidies and claim that the rise in food prices is outside their control, they are both imposing this sweeping range of import taxes on food and spending over £50 million a year through the Intervention Board solely to keep food prices up. There are, therefore, two simple ways to bring food prices down—and the Prime Minister asked today what the Opposition would do. They can be brought down any day of the week, literally at a stroke, by cancelling the whole range of import food taxes now in force and abolishing the Intervention Board and its whole operations.
If there are any people left who still pretend that the common agricultural policy has not already pushed up food prices here, they have only to look at the prices of some key commodities—sugar, for instance. The United Kingdom intervention price is already well above the Commonwealth Sugar Agreement price. For butter, the intervention price is already above the world price. Of course, if one stays out of the EEC altogether, as the Russians have done, one can buy butter for 8p a pound instead of paying, as we do, about 25p a pound. And, significantly, one of the few major foodstuffs which has not risen in price at all in the last three years—tea—is not affected by the CAP.
The most serious blow to this country's future is that not merely is the CAP forcing food prices up now, but that, if we remain bound by it, it will prevent them from coming down when world prices fall—indeed, it will force them up still further. For instance, the import levy on butter is now £163 a ton, or about 40 per cent. of the world price. Under the present arrangements in four years' time it is due to rise to £601 a ton—about 150 per cent. of the present world price. What are butter prices likely to be when that happens?
One might have supposed that if there were any shred of reality in the Government's claim not to be responsible for the rise in food prices, the main aim of their policy this year would have been the drastic reform of the CAP. We were told again and again that one of the main purposes of joining this curious organisation was to reform it from within. Indeed,

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the Prime Minister's White Paper of July 1971 said:
"We shall be joining at a moment when we shall be able to influence the process of development. We shall have full opportunity to make our views heard and our influence felt in the councils of the Community."
What is happening?
This year, with the GATT negotiations due to open in September, the Government have had an ideal opportunity to demand drastic reform of the CAP. The major interest of the United States coincides with ours, as does that of Canada, Australia and New Zealand, in requiring freer international trade in grain and other foodstuffs. We could have argued with massive international support. But the Government have agreed in advance, without even informing, let alone consulting, the British Parliament, to a Community document, dictated, of course, by the French, which says that the "principles and mechanisms "of the CAP
"should not he called into question and are therefore in no way a matter for negotiation."
So it is laid down in black and white that all the monstrosities of the CAP are sacrosanct and that France is to continue, apparently, indefinitely, to be allowed to live on a dole from this country. This surrender, in the prospective GATT negotiations, of such a priceless opportunity, which has hardly been revealed to the House at all, is an act of extraordinary folly by the Government.
The Prime Minster told us the other day that a complete review of the whole CAP is going on within the Community itself. But what is the good of holding an internal review in the Community, where we are in a hopeless minority on this issue, when we throw away the one real chance of getting any substantial reform adopted in practice in international negotiations? The exclusion of the CAP principles and mechanisms from the GATT negotiations is one of the worst surrenders of British interests made by any British Government for a very long time. It means, if the Government have their way, the deliberate and completely unnecessary adoption of a rigid dear-food system indefinitely, for this country. That in itself together, with the completely negative speech of the Prime Minister, would fully justify this House in censuring the Government's food policy today.
6.33 p.m.
Mr. Christopher Tugendhat: It is always a pleasure to speak following the right hon. Member for Battersea, North (Mr. Jay). Some speeches of right hon. Members on the Opposition benches have not always been marked by consistency, but not even his worst enemy would accuse the right hon. Gentleman of inconsistency in this subject. I cannot think of any Member from an urban constituency who has devoted more time to the study of food and agricultural matters than he has, albeit that I do not find myself always in agreement with his conclusions. Perhaps it is a pity that the right hon. Member for Newcastle-upon-Tyne, Central (Mr. Edward Short) did not talk to the right hon. Gentleman before going on the radio earlier today.
Mr. Edward Short: My right hon. Friend the Member for Battersea, North (Mr. Jay) has proved exactly what I said—that levies imposed in the last two years are denying us access to cheap food from many parts of the world.
Tugendhat: Whether the right hon. Member for Battersea, North would also have agreed with the points made by the right hon. Member for Newcastle-upon-Tyne, Central about poultry in the United States and pigmeat in Poland I do not know, especially in view of the export restrictions recently imposed by the United States.
We face a difficult outlook. The right hon. Member for Battersea, North referred to the terms of trade. I agree that the rate of increase in world prices will probably not go on rising at anything like the rate of last year. It would be contrary to all experience of markets were it to do so. But he may well agree with me that, at the most optimistic, it is likely to be some time before the relative level of import prices to export prices returns to anything like the sort of level we were accustomed to in the late 1960s and early 1970s.
At the same time we find a difficult situation with regard to interest rates. There has been news of rising interest rates in the United States and on the Continent. It seems only a matter of time before interest rates have to rise here. If there is a disaster with the harvest, or any

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natural upset of that kind, the terms of trade may not improve to the extent that I hope they will. That, too, will add to the Government's problems.
In this context the Government must do more than simply try to reduce the rate of inflation as much as possible. They must also try to protect people against its impact. Rapid inflation is always harmful to society and always unfair in its effects. But even when inflation is proceeding more rapidly than we should like there is a great deal a Government can do to mitigate its worst effects and to protect people against its more disastrous consequences.
I believe that threshold agreements provide considerable hope here. I was most encouraged by what the Prime Minister had to say about the Government's attitude towards such agreements. The trade union movement—at least, a great part of it—is overwhelmingly concerned to secure rising living standards for its members. It is aware of the absurdity of securing large percentage increases if these are whittled away within a few months of their implementation. It is quite understandable that at a time of rapid inflation trade union leaders should fear that their gains will be quickly diminished and should therefore go for much larger increases than can be justified by circumstances ruling at the moment of negotiation. They feel that they must have something in hand to take account of the price increases to follow. Unfortunately, when they adopt this negotiating position they are contributing to inflation, since each excessive wage claim leads to a further increase in costs and thus to a further increase in prices.
If we had a workable system of threshold agreements there would be scope for trade union leaders to go for real increases in living standards, with the guarantee that if prices rose thereafter their members would be protected. In that way we should secure a much more realistic level of settlements.
Mr. J. Bruce-Gardyne: I am a bit bemused by what my hon. Friend said, namely, that wage increases contributed thereafter to price increases. How will that not apply to threshold agreements when the threshold is activated?
Mr. Tugendhat: My hon. Friend is trying to drive my argument rather further than I would wish to do. Clearly, any wage increase enters into a company's costs. My point, which perhaps I should have explained more fully, was that a large wage increase is likely to have a greater impact on costs than a more modest one. That is what I was trying to say, and I do not think that it is a particularly exceptionable point of view.
If, thereafter, prices rise under a threshold agreement, wages will follow. I accept the point that my hon. Friend might make—that this will have an impact on costs. I shall revert to that question later. Threshold agreements seem to provide some way out of our dilemma. If we have such agreement it is critical that we should be quite clear about the nature of the indices to which they should be linked. Ideally, they should not be linked to the cost of living index as a whole, since that includes such a wide variety of goods and services, many of which are purchased by people only once a year or at even more infrequent intervals.
The important thing is to link the threshold agreement to the essentials—food, housing and possibly fuel—rather than to the cost of living index as a whole.
Mr. Heffer: I am fascinated by the hon. Gentleman. What margin above that would he suggest? Obviously, people want to buy motor cars, they want to go on overseas holidays, and they want to buy refrigerators. As these things become available, more and more workers want to have such things. Where is the margin?
Mr. Tugendhat: I agree that more and more people want to have cars and refrigerators, and to go on foreign holidays. It is quite right that they should wish to have these things, and wholly desirable that they should receive them. The hon. Gentleman would probably agree that one of the things that people most resent is to find that the proportion of their income taken up by things which they regard as necessities is increasing rather than diminishing.
One of the signs of the improving living standards in this country since the war has been the fact that the proportion of most ordinary people's incomes spent on

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necessities has diminished. The amount available to spend on things that used to be regarded as luxuries has increased. When people find that trend reversed they are naturally filled with hostility and resentment. It seems to be that the type of agreement that I am advocating would have the advantage at least of holding steady the proportion of people's income spent on necessities. I share the hon. Gentleman's general objective, that more people should enjoy those things that were at one time confined to the rich. I believe that the proposal I am putting forward will enable that joint aim to be more readily attained.
Threshold agreements by themselves are not enough. It is also necessary to give direct help to women. It is a truism that it is the man who gets the wage increase and the woman who gets the price increase. When the Government produce their phase 3 proposals it is necessary for them to pay particular regard to this. My preference would be for an increase in family allowances. I agree that the family income supplement is particularly helpful for those in need, so long as they take it up.
However, what is needed now is general assistance for housewives. I am not arguing against increasing family income supplement, but the primary concern at the moment should be to help all those who have to face price increases. I would, therefore, prefer family allowances. If the Government can find another way of achieving the same objective, that would be quite acceptable to me and, I am sure, to everyone else. Failing that, family allowances seem to offer the best bet.
The Government must also remember those who are not members of trade unions. It is possible to provide direct help to specific groups, such as those in receipt of family income supplement, pensioners, and so on. It is very much harder, in the context of the Government CBI-TUC negotiations and the rest of the panoply of economic management, to provide assistance to the self-employed and those on fixed incomes. This is a section of the community that tends to be overlooked in such negotiations. I hope that in their efforts to bring about reasonable threshold agreements the Government will not overlook that section.
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That brings me to subsidies. This is a controversial and emotional subject in politics and there is always a danger that the mere use of the word will lead to misunderstanding and misrepresentation. No one in his right mind would advocate across-the-board subsidies on all foods regardless of circumstances.
That would be an indiscriminate and expensive way of achieving very little, in terms of reducing the cost of living. I was encouraged by the Prime Minister's approach to selective subsidies on a limited range of foodstuffs. I am glad that in recent months the Government have moved some way towards making greater use of selective subsidies of this sort. As they move further along the road towards stage 3 they may well find that selective subsidies, to a limited extent, will have a more important role to play than in the past.
Threshold agreements have many advantages. However, there is a possibility that the indices to which they are linked will rise at a dangerously rapid rate, especially if the terms of trade do not move in the way expected by the right hon. Member for Battersea, North and myself. It is necessary for the Government to have in their power the means of putting a brake on the increase in the indices which would trigger off the threshold agreement. It is also important that the Government should have in their power the means to help and protect people who would not be helped and protected by threshold agreements.
I am sure that threshold agreements should be the centre point of the Government's policy. They would have to be backed by family allowances, or some other device of that kind. Greater use of the policy that the Government have been adopting on selective subsidies may also turn out to be appropriate.
Mr. Speaker: There are still over 20 hon. Members who wish to speak. I therefore hope that hon. Members will keep their speeches short.
6.46 p.m.
Mr. John Pardoe: The motion speaks of having no confidence in Her Majesty's Government. On these matters I have no confidence in the Government or in the Opposition. If one is to believe the results of recent by-elections, the country has no confidence in

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them, either. The motion, broadly, is in two parts. The first concerns the control of the rise in food prices and the cost of other essentials and the maintenance of the value of the pound at home and abroad. The second mentions the creation of a fair and just society.
Let me deal with the second part of the motion first. Did the Leader of the Opposition expect a fair and just society to be created by a Tory Government? What did he think he got from his own Government during their six years in office? Did the Labour Government create a fair and just society? Has the right hon. Gentleman read what one can only call the tombstone of the Labour Government—the betrayal of the radical cause, "Labour and Inequality"? If he has, can he any longer believe that his Government created anything that could be described as a fair and just society?
I turn to the first part of the motion, dealing with the prices and the pound. Again, I have no confidence in either the Government or the Opposition. The Leader of the Opposition said today that the Prime Minister had won the last election on the question of prices—but was it not perhaps on the question of prices that the Labour Party lost the last election? The right hon. Gentleman went on to say, "Most hon. Members opposite are here because of the Prime Minister's pledges."But it is just as easy to say that most of them are here because of the pledges which he, the Leader of the Opposition, when Prime Minister, broke. The right hon. Gentleman said that if the Prime Minister had meant his promises it was merely a question of a charge of incompetance; if lie did not, it was dishonesty. But plenty of promises were given in 1964 and 1966, a host of which were broken. I do not intend to detail them today.
At the last election the Conservatives made ludicrous promises on prices. They are set out in the campaign guide in the Conservative manifesto, "A Better Tomorrow", and in the Prime Minister's speeches made before the last election. But votes were not cast only on the basis of Tory promises. They were also withheld from the Labour Party because of its record on prices and its lack of policies for putting them right.
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The record on prices for a long time-10 years or more—is nothing to write home about. A new house, which at the 1964 election cost on average £3,500, cost £5,000 at the 1970 election and would now cost rather more than £9,500. In other words, under the Labour Government, the cost increased by 441 per cent. and under the Conservative Government it has increased by nearly 100 per cent. on current figures and by 86–6 per cent. on the figures for the first quarter of the year.
Council house rents, after rebates, averaged £1·35 in October 1964, £2·27 in June 1970 and £3·05 at the end of last year, which is the latest period for which figures are available. Under the Labour Government the increase in council rents was 68·1 per cent.—a disastrous record in six years. The 34·4 per cent. increase under the Conservative Government to last October is bad enough, but is better on a pro rata basis.
Tory promises on prices have been broken. What we need to know is how some of them came to be made. Page 16 of the Conservative Party manifesto deals with the question of food and farming. There is a short paragraph on prices, which states:
"The resultant small increases in food prices"—
that is, as a result of the change in agricultural policies—
"will amount to just over a penny in the pound per year on the cost of living for three years—a small increase in comparison with the five shillings in the pound rise of the last six years".
It mentioned the rise in food prices, but it is incredible that it did not mention the likelihood that the cheap world food markets from which we had derived our food for many years—almost centuries—were likely to come to an end. It was because we in the Liberal Party were certain that they would come to an end that we became interested at an early stage in Britain's joining the Common Market. We knew that the cheap food markets would end sooner or later. The question that must be asked of any British Government is, "What did the Government do to expand home production to take care of the situation?" Both Labour and Conservative Governments paid farmers less to produce more.

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Page 14 of the Conservative Party manifesto says this about the nationalised industries:
"We will progressively reduce the involvement of the State in the nationalised industries … so as to improve their competitiveness."
I take that to imply that the Government would not involve themselves too much in the pricing policies of the nationalised industries. Yet they said at the same time that they would, by taking direct action, keep down the price of nationalised industries' output and services. How could they do that without greater involvement? How could they do it without a subsidy?
On house prices the manifesto said:
"Our policies will help to keep down house prices".
How did the Government expect that to be done? How will the Government's attempt to keep down mortgage interest rates reduce the price of houses? It can only increase it. How will the subsidy to building societies—which, after all, is a subsidy to owner-occupiers buying their houses—bring down the price of houses? It can only increase it. There is a series of confusions, contortions and contradictions in the promises that have been made and the present policies.
The matters lying behind the motion and the problems of the £ sterling and prices are fundamental questions about the economy. Is the economy expanding too fast? My answer is a firm "No". The pace of expansion of the economy has been moderating even since before the Budget. It was a cautious Budget. I said that it was slightly deflationary, and the downturn in consumer expenditure has shown that to be true.
Is there overheating? There is a danger of bottlenecks, but no positive conclusions can be deduced from unfilled vacancies. The contradiction between unfilled vacancies and unemployment in the regions is an indication only of the poverty of training programmes during the last 10–15 years. On the pace of economic expansion, I say to the Government, "Keep going."
There is the problem of prestige and public expenditure. More than a decade ago the Liberal Party produced an outline of Liberal economic policy headed "Growth not Grandeur". I want growth, but I do not want prestige investment.
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Alas, we have had far too much. It is with us now with Maplin, and goodness knows how much more money will be swallowed up by Concorde and similar projects.
What are we to do about the sinking pound? There is no remedy to be found in the fixed exchange rate. I hope that the siren voice of the right hon. Member for Birmingham, Stechford (Mr. Roy Jenkins), in his recent intervention, will not be heeded. Even with our considerable resources, we cannot conceivably protect a fixed exchange rate in the present speculative climate of the international currency markets. To do so would run down our reserves unnecessarily and foolishly.
I have always believed in a managed float. I am one of the founding fathers of the floating pound, having fought three elections on that policy. I believed that the crawling peg was the means of managing the float. There is a case for the Bank's giving selective and limited help to the pound, but I would not advise hanging on at the expense of the reserves. That would put enormous sums of money into the pockets of the speculators.
The Chancellor of the Exchequer said recently that he thought the pound was undervalued. In a floating situation, what is an undervalued currency? It is a nonsensical phrase. To ask whether the pound is undervalued or overvalued is to ask a nonsensical question. The pound is worth what people in the international currency markets will pay for it—no more and no less—exactly what they will pay today, not yesterday and not tomorrow.
If the Chancellor of the Exchequer meant that there is little relationship between the sinking of the pound and internal inflation, I accept that. America, for instance, has had a lower rate of inflation than we have, but its currency is down more than ours. The Swiss have had a higher rate of inflation, but their currency is up more than ours. That state of affairs is the opposite of what most hon. Members would expect.
What has happened to currencies? If we take March 1971 as 100 and use the Maxwell Stamp currency index, the pound is now 88 against a weighted average of 14 principal currencies, but against the Deutschemark the pound is now 67. It has lost one-third of its value

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against the Deutschemark in two years. Far from bemoaning this fact we should be glad that it makes us hugely competitive. We shall make a killing in the European markets very shortly. America is even more competitive in these markets. Its currency is down, on the weighted average, to 83 compared with our fall to 88 since March 1971. One consequence of this is that the Germans and the French will shortly be in trouble. They will not be able to sell their exports. Europe will find it difficult to sell to America. If these trends continue they will mean the death of Concorde and the whole European aero-industry.
The Belgians have been offered two aircraft—the French Mercure airliner and the Boering 737. For the same price they can get one Mercure or two Boeings. It will need a lot of political pressure from President Pompidou to persuade the Belgian Government that one Mercure is a good bargain against two Boeings. An interesting piece of news published recently in "Fortune" is that for less than the price we and the French have paid for developing Concorde we could have bought a controlling interest in the whole of the American aircraft industry. That would have been a fairly cheap investment in American aero-industry know-how.
What are we to do about prices? I agree with the hon. Member for Cities of London and Westminster (Mr. Tugendhat) that first we have to separate protection from attempts to cure the problem. We have to protect all wage earners, and particularly the lower-paid, against those prices which cannot be controlled and to admit those prices which cannot be controlled openly and honestly.
I was interested in the Prime Minister's proposals for a threshold agreement and also in the gloss which the hon. Member for Cities of London and Westminster gave to them. He will not be unmindful of the fact that I have made three speeches in economic debates advocating precisely the same policy, the first being on 5th March—
Mr. Kenneth Lewis: Does not the hon. Gentleman agree that, as the Liberal Party and its representatives back almost everything,
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they can always say they have backed a particular policy even though it is the opposite of the policy they advocated?
Mr. Pardoe: The hon. Gentleman should not claim that he can back everything. If he were to read the promises made in this dirty piece of paper, the Tory manifesto, and his own election address he would realise that he put his name to a list of promises that has now been torn to shreds. He should not throw that taunt at the Liberal Party. Of course it is not true of us, but whether or not a statement made in this House is true is a side issue.
I hope that the Government proposal for a threshold agreement will be limited primarily to food prices. I take the point made by the hon. Member for Liverpool, Walton (Mr. Heifer) about people being able to buy cars, but we should not protect people against rises in the cost of colour television sets and motor cars. What we have to protect them against is the rise in the cost of imported foodstuffs. Rents should be dealt with in an entirely different way.
We should discriminate positively in favour of the lower-paid by calculating the effect of rising food prices over the last six months on the average industrial wage earner with a family and paying him an equivalent amount in a flat rate payment right across the board on the threshold agreement. That would help the lower-paid as opposed to the better-off. It is a far preferable system to subsidies. Until we have an answer from the Labour Party telling us how much the subsidy programme would cost in terms of an increase in income tax alone, we cannot take seriously the advocacy of subsidies by the Labour Front Bench. The second protection that is necessary is a minimum earnings guarantee, in line with the Private Member's Bill that I introduced two or three weeks ago.
By linking pensions with average industrial earnings and, over five or six years, bunging up the pension for a married couple to the level of half the average industrial earnings, we should be able to protect the old.
Families have had it tough. This has been a bachelors' Government with a vengeance, and it has produced bachelors' Budgets. There has been precious little help for families. Family allowances

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would be the best short-term answer, as they were at the last election, when they were promised. They are not the best long-term answer. That will come through credit income tax, about which we shall know more when the Select Committee report is published tomorrow. Rents should be dealt with primarily through the medium of credit income tax. I will say no more on that in case I leak something that should not be leaked.
On incomes policy the Prime Minister waxes eloquently, with the view that no modern Government could run an economy without intervention in incomes. I remind the House that three years ago the Conservatives took a fundamentally different view.
Mr. Kenneth Lewis: Not I.
Mr. Pardoe: The hon. Member for Rutland and Stamford (Mr. Kenneth Lewis) advocates everything, so he is always right. He wants it both ways.
Mr. Kenneth Lewis: I merely wish to indicate that the Liberal Party is not the only party that has taken certain lines on certain issues. I did not oppose Labour's incomes policy. I have always advocated an incomes policy.
Mr. Pardoe: I am glad to hear that. I have sat through most debates on an incomes policy since 1966 and I have made many speeches on the subject. I have heard speeches from the Labour Party on prices and incomes and I have heard speeches on the subject from the Conservative Government. The only trouble is that they have stopped sides. I remind the hon. Gentleman that on page 11 of the Tory manifesto his party said that
"Labour's compulsory wage control was a failure and we will not repeat it … We reject the detailed intervention of Socialism which usurps the functions of management and seeks to dictate prices and earnings in industry."
I hope that the hon. Member for Rutland and Stamford will be able to show me a speech in which he denied that he accepted that policy.
I believe that there has to be statutory incomes intervention. Voluntary incomes intervention is a non-starter and cannot possibly work. The way to do this is not by imprisoning or fining trade union leaders for doing their job; it is by taxing those who obtain excessive wage increases. We should fix a ceiling on what-
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ever the economy can support. Firms that increase their average earnings per employee by more than that ceiling should have a selective tax imposed upon them. The best way to operate the system would be through National Insurance contributions. I shall not enter into an argument with the hon. Member for the Cities of London and Westminster on the question whether the Liberal Party or the Economist invented this scheme. I pay tribute to Mr. Norman Macrae if he thought up this idea in his bath. Whoever thought it up, it seems to me to be the best way of implementing Government intervention in terms of income.
I am glad to hear that the Prime Minister is now a paid-up convert to the view that such intervention is essential in the running of any modern economy.
7.0 p.m.
Mr. J. Selwyn Gummer: In some ways it must be pleasant to be the Liberal Party's spokesman on economics because, at the end of it all, one does not have to add up the bill when one has chosen all the various bits that have taken one's fancy from everyone else's policy. In that way it is easy to be consistent. The seated interventions made by the hon. Member for Liverpool, Walton (Mr. Heller) were quite correct. In other words, the Liberal Party does not have to pick up the tab, nor is it likely to have to do so, and therefore it can present the most attractive policies. This is what happens when somebody else is presented with the bill and has to pay it.
The speech made by the right hon. Gentleman the Leader of the Opposition ended on a promising note. He concluded by saying that he was concerned to share the wealth of the nation and to create one nation. That is a statement that can be shared even by the economic spokesman for the Liberal Party, and we can surely all agree on that.
I should like to look at the major aim which I am sure we all want to achieve. I refer to the creation of wealth and the sharing of it in such a way that the people of our nation—whatever they may do, whatever attitudes they may have, or whatever jobs they may do—will share increasingly in that wealth. This means obtaining the wealth in the first place.

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At no point in his speech did the Leader of the Opposition give any indication of what new methods he had evolved after six years during which the major failure of his Government was that they did not create the wealth to help those who are in need as well as those who are the wage earners. It is true to say that under the Labour Government the poor got poorer. That did not happen because the right hon. Gentleman, the then Prime Minister, was wicked or because he wanted to remove money from them, but because he had not got the money and the wealth was not being created. Therefore, the Labour Government was unable to carry out the undoubtedly good intentions of the right hon. Gentleman. When we are concerned with the creation of wealth, growth must come first. It is this dedication to growth which seems to me to be the hallmark of the Government's policy, which I support.
The hon. Member for West Bromwich (Miss Boothroyd) made a maiden speech which was controversial, and I should like to refer to it. She asked whether a Government had the right to ask for wage restraint when profits rise. The answer to that has to be "Yes". Unless profits rise and unless those profits are reinvested and used for the expansion of industry, there can be no expansion of our wealth. Therefore, it seems to me to be a most dishonest argument by the Leader of the Opposition to suggest that there is something wicked in profits per se. Profits are essential for the health of an economy and Labour Members are right to investigate the matter, to argue about how those profits are to be used and whether they are to be used for the expansion of industry or are in fact used in an unsatisfactory way.
Mr. Michael Meacher: If the present Government are so effective in generating wealth to decrease poverty, why has the policy of the present Government led to an increase of a third of a million in the number of the poor in the last three years, and why are the poor continuing to get poorer under the Tories?
Mr. Gummer: Those figures are just not true. All we have done is to increase supplementary benefit rates. The hon. Member for Oldham, West (Mr. Meacher)
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often puts forward that argument, and it is easily destroyed. No doubt the hon. Gentleman by repeating those false figures often enough hopes that the public will come to believe them. But the public will not believe them because those who are hardest hit by rising prices have been helped much more by the present Government than they were by the Labour Government. I hope that such people will be further helped, and I have one or two suggestions about what can be done to give help to those who are most in need.
There is no point in continuing the age-old argument in which one side says "Yah-boo" to profits instead of attempting to isolate the real issue. That issue is whether profits once created are used in a way that is beneficial to society or whether they are not.
I was interested to hear the Leader of the Opposition's remarks about wages. He argued that we needed a policy which accepted that wages were not a material part of the increase in prices. What he was saying was that if we had not restricted wages, in some mysterious way prices would have risen less fast. In fact, he was asking us to do something which would result not in less price increases but in more price increases.
It is surely dishonest to suggest that we can go for a prices and incomes policy in which prices are restrained and wages are not. The right hon. Gentleman refuses to face that basic issue. It is difficult for the right hon. Gentleman because he has given his word that there will be no restriction on wage increases, but he cannot explain how one can restrain prices without restraining wages. All one would do would be to increase the present rise in the cost of living, which is the result of many causes and which would cause the sort of wage-push inflation that we experienced in the dying days of the Labour Government in their attempt to win the election.
Then we heard the fascinating suggestion that in some way or other the European Economic Community was a subject which could be left out of any discussion of the means of getting more wealth. The fact is that all over the country companies have been expanding precisely because of the opportunities which our membership of the Community

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has created. A company with which I am connected has for the first time set up a major export department which will make a great deal of difference to the employment prospects in a part of Yorkshire where employment is not as good as it ought to be and which will increase the wages of the very large number of people whom we employ. The reason is that for the first time we are able to get into markets which were closed to us before Britain's entry.
It would be wrong to discuss these matters without realising that one of the reasons for having confidence in this Government is that they had the honesty and integrity to stand up for what they believed in and did not turn their backs upon the possibility of Britain becoming a member of the European Community. It was one of the most progressive stands that could have been taken by any Government and it was one which would have been taken by a Labour Government if right hon. and hon. Gentlemen opposite had not at the last moment had to step back as a result of the pressure from those who really call the tune in that party.
If we create the wealth we must be concerned about how we share that wealth. I thought that it was unfair of the hon. Member for West Bromwich to suggest that nothing had been done for pensioners. The facts are totally against the hon. Lady. Pensioners have been helped more in real terms than ever before and, with the increase which is to come in October, they will be cushioned in a way that has never happened to old people before.
If we are to continue along those lines we have to look much more carefully at the ways in which pensioners are helped directly in terms of means-tested benefits. The hon. Member for Oldham, West has a point when he says repeatedly that we have too many means-tested arrangements. I am all in favour of providing for those who need help and not for those who do not need it. But for many pensioners and others seeking help the complicated arrangements that we have make matters extremely difficult. I hope that we shall not be backward when we introduce some sort of negative income tax, if that is the intention, in trying to bring into the system as many of the benefits as
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possible as are now available through means-tested arrangements.
The Leader of the Opposition dealt at length with rents. But how wrong it is to discuss a policy of helping those who need help by emphasising the increases in rents for those who can afford them but not emphasising the cuts in rents for the many hundreds of people in my constituency who are now better off because of the rent rebate scheme and the additional allowances made by this Government
There was a tremendous fuss in my constituency when the local labour council, at the ratepayers' expense, spread alarm and despondency by saying that under this Government rents would be tripled and that all sorts of outrageous things were likely to happen. Since the Government's proposals came into force, so many people have benefited from them that the Labour Party cannot even get its own supporters out to make any attack on rents.
Mr. Skinner: Notwithstanding all that the hon. Gentleman says about these wonderful rebates and allowances, does he recollect that in the recent local government elections, not merely in his constituency but throughout the whole of England, Wales and Scotland, the same people who are supposedly benefiting from these Conservative rebates turned out and voted against his party, with the net result that the Conservative Party lost control of nearly every local council?
Mr. Gummer: If the hon. Gentleman thinks that there is any link between his views on rents and the local government election results—unsatisfactory as they were for my party—he should look at some of the Liberal successes. It does not appear to be true that hordes of people rushed out enthusiastically to vote Labour.
If the facts put forward by the Leader of the Opposition are true, if the Labour Party has a marvellous alternative policy providing the great answer to the problems of our time and if after six years of trying and failing it has now got it right, is not it surprising that at a period in the life of a Parliament when other Opposition parties have done very well, the Labour Party has failed to make any impact? I am not suggesting that the Conservatives have done very well. I

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am not suggesting that we are suddenly picking up enormous numbers of votes all over the country. But at a time when the Government are implementing tough and strict measures, the fact that the alternative party fails to make any impact on the electorate clearly shows that the one Government that the country does not want again is one led by the present Leader of the Opposition. I remind hon. Members that at this stage during the life of the Labour Government, the Conservative Party was winning seats that it had never won before.
Mr. Pardoe: The hon. Gentleman gives the impression that between 1972 and 1973 there was a net swing against the Government. May I remind him that despite the Government's appalling record there was in fact a net swing against the Labour Party in those areas where the figures can be compared?
Mr. Gummer: I am obliged to the hon. Member for Cornwall, North (Mr. Pardoe). I shall be more careful about my opening comments in the future. However comparisons are very difficult because of changes in the areas. In any event, it is quite clear that the people do not believe the speeches of the Leader of the Opposition.
If we are first to create wealth and then to see that it is shared properly, we must have a policy for doing it. The Opposition's motion of no confidence demands prima facie an apology. It demands at some point, in some speech, that someone should explain the Opposition's policy. I agree that the Government must defend their record and explain why they have done this, that and the other. But the Opposition must say what they would do.
I listened carefully to the Leader of the Opposition. He made a number of suggestions. For example, he suggested a crisis tax on land. That would certainly increase the price of housing, and I have no doubt that it would stop the pressure on mortgage rates. The right hon. Gentleman then referred to the greater need for public ownership. I am not sure that that has helped to improve prices in the past. It has not helped us at any point.
At no stage in his speech did the right hon. Gentleman mention any specific
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measure which the Opposition wished to introduce, except for his slight embarrassment in trying to get out of what turned out to have been a major faux pas on the part of the right hon. Member for Newcastle-upon-Tyne, Central (Mr. Edward Short) in a radio programme this morning. The right hon. Gentleman's speech was full of the most damaging and dangerous material of politics. By that I do not mean damaging or dangerous to the Government or to the country. I mean damaging and dangerous to politics. First we had the right hon. Gentleman's attempt to pick up any kind of prejudiced attitude and to use it. There was every kind of anti-foreigner comment which could possibly be used at every point. On every occasion that it was possible to blame or to use the foreigner as an example, the right hon. Gentleman seized the opportunity.
Then we had the right hon. Gentleman's pretence that world prices or other matters which we know to have an effect on prices in this country could be dismissed with an airy wave of the hand. I remind the House that the right hon. Gentleman was the Prime Minister who always pleaded with the House and the country to be fair and honest and to face the realities of a situation. He was totally dishonest today in putting forward views which suggested that the facts of international life could be ignored.
When the leader of the alternative government makes a speech of that kind, the least that we can expect in this House is that he should put forward a concerted alternative attitude to the situation that we face. The right hon. Gentleman offered no means of getting more wealth and no means of sharing that wealth. He explained no policy. He does not deserve votes, even from those who on occasion support him. For that reason we must show that there is only one policy for solving our problems and that it is being put into operation by this Government.
7.25 p.m.
Mr. Roger Stott: I ask the indulgence and tolerance of the House while I make my first speech in this Chamber.
I have recently been given the honour to represent my constituents in this House

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owing to the death of their former Member. I never had the privilege of personally knowing my predecessor, Tom Price, but I knew of him and I have been left in no doubt by the many people to whom I have spoken of the esteem, affection and genuine respect that was afforded to him by his constituents, his friends and his Parliamentary colleagues.
Tom Price represented Westhoughton for 22 years. He spoke regularly in many debates in this Chamber and served on many Committees of this House. But I think that he will be best remembered for his knowledge and expertise in the sphere of pensions and superannuation. I am sure that his presence enriched this Chamber.
My constituency has a long and proud record of Labour representation in this House, going back over half a century. Its people are endowed with an abundance of Lancashire humour and friendliness. The six townships within its boundaries were built upon the traditional industries of Lancashire—coal mining, textiles and railway workshops. Some of those industries have now sadly declined, but they have been replaced by other industries which reflect the rapid growth in technology that took place whilst Toni Price was a Member of Parliament. However, there are still many problems within the constituency which need to be tackled. The inadequate number of council houses and the very long waiting lists for this type of accommodation are matters that give rise to a great deal of concern. We have made great progress in building new schools and greater recreation facilities, but much remains to be done before we completely eradicate the terrible old buildings in which many of the children in my constituency are being taught.
It is particularly significant that the debate today is about the rapid increase in the cost of living, prices and inflation generally. Indeed, those of us who have gained electoral success recently know full well that the predominant issue throughout our campaigns was that of rising prices. The way in which the wages and salaries of my constituents and, indeed, those of many others are being remorselessly eroded by constantly rising prices was the issue, above any other, that was causing the most concern.
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I took a great deal of interest in the Prime Minister's speech when he spoke about inflation. I know from personal experience, prior to entering this House, how difficult it is to balance the family budget when, on the one hand, my wife wanted more money for the weekly groceries and, on the other, my wage packet was not increasing. Indeed, many people's wage packets were actually frozen.
But if the situation is difficult for my wife and others like her, I am sure that it must be terribly difficult for those on fixed incomes and old-age pensioners when they try to live and eat properly in our "Better Tomorrow".
The scandalous rise in the prices of fresh foodstuffs recently is constantly being talked about by the women in my constituency. Indeed, only the other day one of my constituents, who happens to be an old-age pensioner, told me that she paid 15p for three small onions. No wonder she wept when she peeled them! The explanation about the rising cost of world food, however tenuously linked to the truth, left her singularly unimpressed. So there is now a substantial case for a direct increase of the old-age pension along the lines proposed by the Opposition.
Unfortunately, inflation, and the failure to deal effectively with it, does not confine itself to food alone. I was profoundly saddened by the frustrations of many young people in my constituency who want to get married but cannot afford to buy a house. It seems that the splendid ideal of having a home of one's own is now beyond the bounds of possibility for most young people, because the speculation and obscene profiteering in housing and land has been allowed to continue without any effective legislation to prevent it.
I think that my constituents and the people of this country as a whole have a right to demand positive action by the Government to stop the continued erosion of their standard of living. If the Government are really serious about providing a better tomorrow, they can start now by repealing the Housing Finance Act, abolishing prescription charges, making positive attempts to distribute the wealth of this nation evenly amongst the people, and substantially increasing the old-age

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pension. If these measures were adopted, I am sure that the Government's talks with the TUC about phase 3 of their prices and incomes policy would be more meaningful. If, however, the Government still stubbornly refuse to do any-think positive about the inflationary situation in which we now find ourselves, the people of this country will do it for them at the next General Election.
I thank the House for a courteous and tolerant hearing.
7.32 p.m.
Mr. Patrick McNair-Wilson: It is with great pleasure that I congratulate the hon. Member for Westhoughton (Mr. Stott) on an absolutely splendid maiden speech. I assure him that making a maiden speech is a bit like being sick. One feels a great deal better afterwards.
Having listened to the hon. Gentleman's moving tribute to his predecessor, Tom Price, I know that he will have brought a great deal of happiness to his many friends both in the House and in the constituency. In view of the hon. Gentleman's clear and incisive speech we look forward to hearing more from him in future.
It was a remarkable experience to listen to the Leader of the Opposition this afternoon posing to my right hon. Friend the Prime Minister the very questions that he had so singularly failed to answer when he was in power. It would not be surprising if the people of this country were completely mystified by the fact that, although the Government had changed, the problems facing this country remain almost the same.
Of course, the right hon. Gentleman made, or appeared to make, strong political points with the merest scraps of economic straws. That, again, is not surprising. When the Labour Government came into power in 1964 they issued a statement on 26th October, with which hon. Members on both sides of the House will be familiar, outlining their view of the economy as they found it.
If I may refresh hon. Members' minds, it contained these words:
"First, the Government took stock of the international financial situation. They have satisfied themselves that, with the facilities available, the strength of sterling can and will
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be maintained … We must no longer be in the position that every time we seek to increase our national production we are forced almost immediately into deficit … An attack must be made on the problem of increasing prices. Not only do they inflict hardship on those least able to bear it, but continually rising prices undermine our competitive power."
No one in this House could possibly disagree with those words. Yet we know that within three years sterling was devalued by 14 per cent. and, as a result, prices began to climb dramatically.
Indeed, in the New Statesman this week, in an article on "Britain's Crisis", written by Mr. Paul Johnson, we find these words:
"The immediate crisis which faces us began in the summer of 1966, when the bottom fell out of Mr. Wilson's government and it abandoned in panic its policies of economic growth. There followed, inevitably, an enforced devaluation, and the beginnings of a new cycle of inflation."
The point I am making is simply that no one in this House has a monopoly of wisdom in running the economy of this country. All hon. Members have had to face disappointments over the performance of their Governments because the promises that they have made on economic matters have so frequently not been fulfilled.
It would not be surprising if our people were to question whether these problems have a solution at all. I am sure that when the Leader of the Opposition talked about the pound in a man's pocket not being devalued he genuinely wanted it to be that way, just as my right hon. Friend clearly wants to get the crisis under control, but I do not believe that toying with the situation and having censure debates backwards and forwards, depending on which side of the House one is sitting, will solve the problem.
We have to ask ourselves what causes the inflationary situation with which we are confronted. There are many possible reasons. There are those who say it is labour costs, there arc those who say it is world prices, there are those who say it is Government expenditure, and there are those who talk about an extension of the money supply leading to this situation. I believe that those are merely symptoms of the situation rather than the causes. In my view, the real cause is that the international monetary structure of the world is unable to cope

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with the demands and desires of rising standards of life and the greater expectations of the peoples of the world.
The hon. Member for Liverpool, Walton (Mr. Heffer), in an intervention, spoke about the desire of people for better material goods, and so on, and he is right, but, as I said with reference to the Labour Party's statement in 1964 on the economic situation, there is always the problem that if we expand beyond a certain point we run into deficit and our currency begins to suffer.
The present world monetary system is like a small blanket on a bed. Someone can have the blanket over his shoulders, or over his feet, but he cannot have it over his whole body. We have reached the situation in the western world in which we cannot expand to meet the real needs of the situation without one currency or another coming under serious pressure. In this situation, Governments are reactive. They are not in a position to take the initiative. They find themselves—as this and the previous Government did—in a situation where their money buys less, and if a country is a net importer, as we are, it means that prices will increase. There is no other way in which the situation can develop.
The hon. Member for Cornwall, North (Mr. Pardoe) spoke about the rate of inflation and the lowering of the value of the United States dollar. What the hon. Gentleman failed to point out is that God made the United States fairly lucky, to the extent that it does not have to import food on the scale that we do. With the fall in the value of money, and particularly with the fall in the value of sterling, further increases in the prices of our imports are bound to take place and, as I see it, there is very little that any national Government can do about it.
Various controls could be introduced as temporary measures, such as wage and price control, with which we are familiar, threshold agreements, to which my right hon. Friend referred this afternoon, subsidies, butter tickets, and so on, but the difficulty with all these temporary measures is to know just how fat one should go. Is there a limit? Ultimately, one reaches the position in which one has to subsidise almost everything—although that argument was rejected this
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afternoon. What concerns me is that this is almost like giving cough drops to a person with lung cancer. They will not cure the disease, though they may bring temporary relief. I suggest that the monetary structure of the western world is in a desperately serious state and that if something is not done soon it will not only be in Britain that these hurricanes of economic problems will blow.
The Government have been skilful in floating sterling. They have at least removed the problem that confronted the previous Labour administration, who were desperately trying to protect a particular parity level against massive speculation. They spent the reserves buying back sterling that was being sold in order to keep the rate up. At least by floating sterling the Government have not had to do that. It is possible to float up and down, but the problems surrounding the United States dollar are now so great that the effect on sterling is worrying.
I shall support my hon. Friend on the Front Bench in the measures that he takes to combat the present situation. With his right hon. Friend he now has a raft of means by which he can deal with the situation as it arises, but in the long term this will not be the answer to our problem. Our problem, ultimately, is to devise a method of expanding stable credit in this country and the western world to take account of the needs of the people.
Many good things have been done by the Government in the form of trying to improve the living standards of the people, cuts in direct taxation, improvements in pensions, and so on, but they do not meet the crux of the problem, which is that what is needed is an urgent review, with our friends in other countries, of the international monetary situation.
There are meetings at Basle and elsewhere and there are discussions about special drawing rights. Although the official price of gold is 42 dollars it is changing hands at 121 dollars. This system is like driving a Model T Ford down the motorway. It is not built for the expanding needs of the world. Until those needs are met we shall go on discussing for many years the subject being debated today, because we shall not find an answer to our problem.
7.42 p.m.
Mr. Eric S. Heffer: We have heard a thoughtful speech from the hon. Member for New Forest (Mr. Patrick McNair-Wilson). Indeed, if I may say so, it was one of the most thoughtful speeches that we have heard today. Unfortunately, this is not a seminar to deal with the great problem with which every industrialised country in the west has been faced since 1945, that of inflation.
There are certain anti-inflationary policies that are beyond any Government's control, but there are some policies that are not, and we are today censuring the Government because of their deliberate policies which have led to higher prices and the imposition of greater burdens on the shoulders of our people. That is the object of the debate.
I confess that I should like the House at some time to discuss in depth the whole problem of how to deal with inflation. I should love to be able to get away from the immediate argument of Government or Opposition policies and to discuss in a much deeper way the whole question whether the existing capitalist society can ever deal with inflation. My simple argument is that it cannot, but again we are not here this afternoon to deal specifically with that question.
The Prime Minister made what I thought was a rather long and dreary speech. It did not lift the House in any way. The right hon. Gentleman made a number of interesting points, but he did not enlighten us about whether the Government had positive answers to this problem. It was very interesting that the Prime Minister said that he made no promises or statements in 1970 about the pressure of world prices because they were not rising then. I can well remember that very little was said about the pressure of world prices before the freeze. We heard in the House from Minister after Minister, particularly from the Prime Minister at Question Time, that the responsibility for rising prices lay in the wage pressure of trade unionists. We heard that day in and day out. We were told that if only we could get the trade unions to moderate their demands
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for increases, we could reduce inflation, prices would be cut back, and the millenium would be around the corner. We were told that we would see a little light at the end of that great tunnel that seems to have existed at least since I have been a Member of the House. It seems to be an endless tunnel.
We have now had the Government's total reversal of policy. Earlier today I intervened in the debate to draw the Prime Minister's attention to the fact that during the period of the Labour Government he was a supporter of neither a voluntary nor a statutory incomes policy. I was not a supporter of a statutory incomes policy, but I was always a supporter of a voluntary incomes policy. I have never changed my position about that. I can remember the speeches that were made by Conservatives, not only in the Chamber but also in Committees, on Bill after Bill, in which they said that it would be disastrous to have a statutory incomes policy.
The present Government, overnight—as they have changed their policy on so many other things—now argue that they need a statutory incomes policy. They introduced this, and a wage freeze. But the rise in prices, particularly food prices, did not halt. Prices continued to rise.
Then we heard the argument which we are now hearing—that price rises are basically due to world prices. Previously we heard little about world prices. Now we hear only about world prices—although the right hon. Gentleman, realising that he could not continue for ever with this argument, slipped back this afternoon into saying that we should have to continue with a wages policy of some kind.
That is all very interesting, but I must draw the attention of Conservative right hon. and hon. Members to some of the statements that were made by them in the General Election campaign of 1970, because the Opposition are censuring them in relation to their policy and their promises.
The Secretary of State for the Environment said in his election address
"Your standard of living will fall, your job will be at risk, if we do not bring runaway prices under control."

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We then had the election address of the right hon. and charming Lady the Secretary of State for Education and Science, who said
"Pensioner; and housewives are helpless as they watch the extra shillings eaten up by price rises, many of which have yet to come."
The one thing about that statement that was accurate were the price rises yet to come. They are still coming.
The Tory election manifesto said,
"Inflation is not only damaging to the economy, it is a major cause of social injustice, always hitting hardest at the weakest and poorest members of our community."
That is absolutely true. It has been proved true by what has happened since the present Government has been in office.
The Foreign Secretary, in his election address, said
"Agricultural deficiency payments will be replaced by levies on imports. It will bring a small, once-for-all rise in the cost of living. But reduced Government interference in industry and an effective competition policy will help to keep other prices down."
I need not continue. If I quoted the election address of practically every Conservative Members, they would probably all have the same basic argument. We have had three years of a Government who have not only failed to keep down prices to a reasonable level but have allowed them to rise, due basically to their own policies.
I promised Mr. Speaker that I would speak for only 10 or 12 minutes, because other hon. Members wish to take part in the debate, although I find that it is very inhibiting in the House these days when one has to confine oneself to 10 minutes to develop an argument. However, one must try.
Let us look at some of the policies that the Government have pursued deliberately in relation to price increases. We were told that value added tax would have no effect on prices. We all know that to be untrue. VAT has led to price increase after price increase. It is no good hon. Members now saying that there have been reductions here and reductions there. They should try to kid the people who are now paying for motor repairs, telephone bills, and just about everything else about the effect of VAT, and try to convince old-age pensioners that they are better off under the present Government.
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A small group of non-political, nonsectarian people in my constituency, called the Aintree Action Group, decorate old people's homes and organise outings for them. They repair old television sets and give them to old-age pensioners. They have been doing this sort of thing for the last 10 years. On the basis of their knowledge gained from practical activity they have organised a petition in a small part of my constituency in support of a demand for a minimum pension of £10 for a single person and £16 for a married couple. From practical experience of helping old people over the years, they have learned that the only way to help them basically is to give them a better pension now. That is what the Government ought to be doing, among many other things such as dealing with rates and house prices.
The hon. Member for Westhoughton (Mr. Scott) made a marvellous maiden speech. It was first class. He said that for young married working-class couples, and for middle-class couples now, houses are totally beyond reach. Even if they could get a mortgage, they could not afford the repayments. It is also a question of acquiring the initial deposit. No doubt some people get the money, but this does not apply to the average ordinary working class person. All these matters are the responsibility of the Government. They cannot dodge their responsibility, no matter how much they try to blame the unions, first of all, then world prices, then the unions again. I hope that the House, and some of the Government supporters, will refrain from supporting the Government, because they deserve to be censured.
7.55 p.m.
Mr. Kenneth Lewis: I will not take up the points made by the hon. Member for Liverpool, Walton (Mr. Heifer) except to comment on a matter at the start of his speech when he said that this was not a debate of censure on the Government for prices which have risen outside their control. The same thing was said by the Leader of the Opposition when he opened the debate. He said that the Government were not being censured for price rises outside their control.
All the price rises which, according to Opposition Members, the Government

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have initiated—VAT, increases in rents and school meals, prescription charges and other matters mentioned by the Leader of the Opposition—should be compared with the increases in wages which have taken place. The fact is that if, from the increases in wages and social benefits one deducted the increases in world prices, people in this country would be miles ahead in their standard of living. They remain ahead in their standard of living, even when increases in world prices are included, but the advantage is smaller, and has been getting smaller in the past few weeks. The Government have been hit by a world hurricane in this matter. They have been unfortunate. This applies to other Governments in Europe as well as to this Government. Without their anti-inflation policy, and without the Price Commission and the Pay Board, the Government and the country would have now been in a disastrous situation.
The anti-inflation policy, the Price Commission and the Pay Board have worked so effectively that even hon. Members on the Government side who were against this policy and who said it would not work, as well as Opposition Members who said it could not work and who voted against it, now admit that until a few weeks ago under phase 1 and phase 2 there has been an arrest in increases in prices and wages, and the internal inflation had been restrained.
A statutory prices and incomes policy should be operated for a certain period, and not for ever. I have never suggested that there should be a permanent statutory prices and incomes policy. We must now think in terms of how to phase this policy out. Those who criticised the introduction of a prices and incomes policy claim that in any case trouble will arise when an attempt is made to get rid of it. They say that this will mean even faster inflation. That happened when Opposition Members set aside their prices and incomes policy, although they had the support of some Government Members.
The Opposition set aside their prices and incomes policy to try to win the General Election, but they set it aside too quickly. I believe that the Price Commission and the Pay Board are here to stay, but they need not have statutory
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powers permanently. We must soon consider whether we phase out some of these statutory powers. I believe that we should first of all phase out the Pay Board's statutory powers. How do we do this? I am glad that my right hon. Friend the Prime Minister said that the Government are intent upon fixing a wages norm for phase 3 which is related to prices. The Pay Board would therefore look at any wage claim presented to it by employers or unions in relation to that kind of norm.
The Government must decide what the country can afford, whether the amount should be as now or something related to the cost of living plus whatever addition the Government think can be contained. This should be the Pay Board's remit. The board would then, at the request of either the unions or the employers or both, decide whether a claim should be allowed but should have no statutory right to impose anything. It should be up to the unions and the employers to decide whether to accept what the board proposes as right.
Meanwhile, the Price Commission should be retained with teeth as strong as or even stronger than it now has. The commission should not be permitted to allow any price rise over and above what the Government think is reasonable in phase 3 if the rise sought contains an element for an increase in wages or salaries above the norm. This is the way to bring restraint into any wage claim which proves to be outrageous. At the same time it will help to bring discipline into industry. Efficient companies would pay increased wages because of their increased efficiency and not from increased prices. The competent and the best industries could thus compete without regard to what they pay in wages.
Mrs. Renée Short: Does not the hon. Gentleman think that the profits made by a company should be taken into account before the Price Commission allows it to increase prices?
Mr. Kenneth Lewis: I am glad the hon. Lady mentioned that. I would allow a similar judgment on dividends. I would allow companies which could pay dividends without increasing prices to do so, because that would secure increased investment.

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This should not take years to reach. The Government should do it in the next few months. World prices will not stay as high as they are now. They arc bound to go down in due course. Any Government should keep their nerve; and this one in particular will do so.
I was interested in the comments of my hon. Friend the Member for the Cities of London and Westminster (Mr. Tugendhat). People are very concerned about price rises, which hit especially hard those on fixed incomes—those on social security and those who must pay the shopping bills, namely, the women. Tomorrow the Select Committee on the Tax-Credit System is to issue a report. The system is not due to conic into operation until 1975. I believe that the family allowance system can be run into the tax-credit system. There is no reason why the Government should not increase family allowances now and eventually the family allowance could be taken over by the tax-credit system. Women would get the benefit immediately. Women do not always have their housekeeping money increased when their husbands have an increase in wages. They need further support.
If it proves necessary, the Government should not hesitate to subsidise selective foods. If the Government are thinking in terms of what should be subsidised, they should consider the Englishman's breakfast which is also sometimes his super. The food which makes up the breakfast could be subsidised.
The Prime Minister said that in phase 3 the norm would be related to the cost of living. I ask my right hon. and hon. Friends, particularly my right hon. Friend the Prime Minister, not to talk about threshold agreements. Nobody outside a university seminar or the House of Commons, and perhaps not even here, understands what a threshold agreement is. The Government will not get their policy over to the country if they talk in those terms. If wage increases are to be related to the cost of living, pension increases and social security benefits should also be related to the cost of living.
The Government must also pay serious attention to some of the arguments of my hon. Friends who do not entirely agree with me up to now. The Government must examine public expenditure. I do
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not want them to abandon the Maplin project, but they could phase it. They need not spend so much money so quickly. They should drop the Channel Tunnel project for the present. In 10 years' time we may need it, but we are not likely to do so for the next five years or so.
Perhaps my hon. Friend the Financial Secretary to the Treasury will tell me whether the regulator is still in operation. I would not mind 1p or more being added to the price of a packet of cigarettes to enable an increase to be made in family allowances, nor do I think that anyone else would complain.
Things which appear meritorious to some are the subject of criticisms to others. A Government are not necessarily any the better because they appear to he administratively efficient and because they are a super machine, or because they put through more and more legislation. We have had enough legislation now from this Government. We were told last Session that there would be less legislation this Session. There has not been less legislation this Session.
Mr. John Stradling Thomas: There has.
Mr. Lewis: In that case, we have had too little of it this Session. We want a greater reduction next Session. People do not always appreciate that changes are for the best, even if Governments think so. There should be a pause during which the Government explain to the public the changes which they think are for the better. It is the Government's job now to put across to the country what they have done, if for no other reason than that a General Election is coming up within the next 18 months. Let us get on with persuading the people that what we have done is the right thing. Then we can hope that before we go to the country it will be apparent to all that we have done the right thing. We should also take the opportunity to explain the alternative which the Labour Party offers. The more we listen to speeches from Labour Members, the more we realise that that whatever criticisms there may be of this Government, the Labour Party has no alternative to offer.
8.10 p.m.
Dr. Edmund Marshall: I cannot share the note of optimism which the

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hon. Member for Rutland and Stamford (Mr. Kenneth Lewis) expressed about the short-term nature of the inflation problem. Until he had spoken I thought there was general agreement from all sides that we were up against a problem of the utmost gravity not just in economic terms but in terms of the social injustice that problem creates.
There is agreement that we are up against a problem of universal proportions. Throughout the Western world inflation is rampant. Conservative Members have described it sensibly as both an eruption of Vesuvius and the eye of a hurricane which is catching us all. It is not surprising that all those countries which are trying to run, in some form or other, a free-reign economy should be faced with the problem of inflation. Inflation is an inevitable consequence of trying to run a free-reign economy in a modern society. Such an economy depends on the working of the profit motive. Every individual unit, whether a person or a corporate firm, has to be expected to fight for the best economic terms it can achieve.
We all know that the price of any commodity, including labour, does not reflect any intrinsic value. Even today we are learning that prices do not depend simply on the interplay of market forces. In a modern industrial society the mechanisms which determine the levels of prices are influenced to an increasing degree by the amount of political and personal pressure which goes into the process. Those pressures can work only upwards. The whole mechanism for determining prices and wages in our kind of economy is a pressure which is essentially working upwards all the time. When the housewife goes shopping she is charged fixed prices for the commodities in the shops and she is in no position to try to bargain or barter to get those prices down. The opportunities for shopping around are limited.
As my hon. Friend the Member for West Bromwich (Miss Boothroyd) pointed out, the housewife is not organised as she was in earlier days. She has no great bargaining power. A far easier method for her is to pass on the upward pressure to her husband so that he may reflect it in his bargaining for increased wages.
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With the mechanisms and processes which produce wage settlements, it is easier for employers to take the line of less resistance, to absorb the increased wages into the system and to put up prices to cover them. All the pressures which have the greatest effect in our kind of economy are pressures which push prices up. Inflation is bound to happen in our kind of free-rein economy.
Nowhere is this better typified than in the system we have for selling and buying houses. People who have a house to sell go to an estate agent and on their behalf he puts it on the market at the best possible price they can achieve. In this respect human greed has produced astronomical prices for property. The system of estate agents and solicitors is geared to push up prices. As a profession the estate agents are dedicated to the creation of inflation. Their fees are worked out in terms of the selling price of the property and often the seller will simply add that likely fee to the price he intends to ask for the house. Often the buyer wants to get hold of the property quickly and is willing to take on a heavy mortgage because he knows that inflation will make it easier for him to meet the repayments in coming years.
The first year of the Government's term of office was one in which the Selsdon Man approach was dominant. There was every encouragement to give our economy a free reign. As a result the kind of inbuilt difficulties which I have described in fact increased. There was great inflation and great unemployment. There were the lame ducks which found they could not survive. There were attempts to give the public sector some kind of free reign economy. The Housing Finance Act which came soon after was an attempt to return the whole area of municipal housing to a free-reign economy. That phase of Government policy was essentially inflationary.
There was then the approach of trying to throw money at everything. Wherever there was a specific firm in difficulty or wherever it became abundantly obvious that the regions needed extra capital support, the Government suddenly rehashed their policies and started throwing in money from an apparently bottomless coffer.

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While these measures may have been welcome palliatives in the short term, we all know that in the longer term they have encouraged inflation and the money supply was increased. I re-echo the words of my right hon. Friend the Leader of the Opposition in opening the debate when he said that money supply policy within the Budgets of certainly 1972 and 1973 have had an added inflationary effect.
We have had the approach of the Government to their prices and incomes policy. It has been stated in debate that the policy started with an arbitrary freeze which froze the injustices of the existing situation last November. We know that on the prices side there must have been thousands of ways in which price controls have been avoided. I will take only one example—a commodity called a shoetree. This was purchased from a department store in Leeds in the last few weeks, the price being 39p for a pair of shoetrees. This is something called a Dasco Shoe-maid and is manufactured in England by a firm, Dunkelman of London. Whereas the price a few weeks ago was 39 pence, only four months ago it was 27 pence—a 44 per cent. increase. I would not accept for a moment that this was an essential commodity in the household budget, although it may well be that it helps to increase the lifetime of a pair of shoes.
In those spheres of the economy where prices are essential the Government have not attempted to have any control in the prices and incomes policy. In housing and fresh food prices the Government have deliberately allowed their other policies to take priority. With regard to food prices we return to the central problem facing us, namely world inflation. This is something on which I re-echo the words of the hon. Member for New Forest (Mr. Patrick McNair-Wilson) when he said that there has to be urgent negotiation between Governments. Above all, we need the kind of world currency agreements which get round the problem of constantly passing on the inflationary pressures from one country to another.
8.23 p.m.
Mr. David Mitchell: In debating the problems of inflation and the Opposition's motion of "no confidence in the Government "; I want briefly to do three things—look at the current posi
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tion, consider what advice one gives to the Government, and examine with some cynicism the Opposition's case.
I know that it is the 960th anniversary of the baptism of King Canute, who was succeeded by his aptly named son, Harold, who appears to be still with us. The present position is one in which the cost of living has risen by 9½ per cent. in the past year, very nearly as much as the 10·3 per cent. by which it rose the year following the General Election, when we saw the consequences of Government policy during the previous period.
I accept that that is not good enough for us today. People are angry. My constituents are resentful, because they do not understand why prices have gone up. It is the duty of Members of Parliament and the Government to trust people and explain to them openly what is going on. They need to carry the public with them. There has been much talk about imported raw material and food prices. Most people recognise that if import prices have gone up it is outside the control of the British Government. Fair-minded people would not seek to blame the British Government for factors outside their control.
I have been studying the facts. It is interesting that since the year 1843 the Economist has been carrying out a regular commodity price classification. It is now based on 28 principal commodities, classified in four groups.
In the 12 months to 4th July one finds that world commodity prices for metals rose by 63 per cent., miscellaneous commodities by 82 per cent., fibres—the raw material of clothes—by 98 per cent., food by 71 per cent., and the overall imported commodities index by 75 per cent. We import about half our food and by far the largest proportion of our raw materials, as we produce very little within this island. In view of such figures, one does not wonder why the cost of living has gone up by 9½ per cent.; one says how remarkable it is that it has not risen a great deal more.
I am heartily relieved that there are signs that the rocketing increase in world prices is levelling off. It is perhaps ironic that those of us who care about the problems of the poorer countries must ruefully recognise that it is in increasing raw material prices that we see the best hope

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for improving the standard of living of those countries.
Let us turn to what the Government should do about the situation. We were elected on a programme to slow down the rise in the cost of living. We expected to do it, planned to do it, and intended to do it, but because of world events which we cannot control we cannot prevent the waves riding in towards us. However, we can and must compensate those who get wet. That means action to help the housewife, the pensioner, the lowest-paid, and those with children.
The House will understand and respect the convention that prevents me from expressing my views on family allowances, pensions and family income supplement. We can help the housewife by permitting wage agreements linked to the cost of living, so that for every 1 per cent. rise in the cost of living there will be a known permitted increase in wages. The housewife will then know that her husband is receiving such an increase and can ask to receive it herself. Far too many husbands are receiving increases and not passing them on. The figures for the past 12 months illustrate that—the cost of living up 9½, per cent. and wages up 13 per cent. How many housewives have had 13 per cent. more in their housekeeping during the past 12 months? If they have not, they should be putting their husbands under fairly close scrutiny to find out just how much extra he has received which he is not passing on.
The Treasury will no doubt object to having wages linked to the cost of living, saying that that fuels the fires of inflation. I realise that there is a problem, but we must set against it the fact that many trade unions conclude agreements that substantially over-kill because they suspect that the rise in the cost of living will be greater than it turns out to be. Therefore, linking wages to the cost of living would moderate wage demands.
Unfortunately, I do not have time to deal in any detail with the way in which I believe the Government should approach phase 3, but I warn the Government to be wary of general flexibility, because it means giving the biggest increases to the biggest, boldest and most bloody-minded trade union membership. That is not something we should seek to defend.
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I beg my right hon. and hon. Friends on the Front Bench to realise that phases 2 and 3 can only buy time—time which the Government must use to get supply and demand in balance. Those of us who want growth, as I do, must acknowledge that it means that we must keep demand roughly in line with growth of capacity. If we do not, we shall run into bottlenecks on the labour front, in steel and in the construction industry, and delays in deliveries, which will suck in imports and put our balance of payments at increasing risk. There are far more than a few signs of that happening at present.
I now turn to the Opposition's motion. I turn to Harold. the heir to King Canute, who sat on a beach not very far from here and urged on all his housecarls. Harold defended himself from the approaching waves by a flood of commands. Harold today has given us a lengthy flood of ways in which he would command prices not to go up. We were told that he would buy cheap food from abroad. When asked where he would buy such food he was unable to produce any practical answer.
The truth is that for many years we enjoyed all the benefits of being tied to world prices at a time when world prices were very low. Prices were so low that our farmers could not conceivably produce at those prices. We had the benefit of that situation and now we will have the disadvantages. We are still committed to world prices. It is not a managed market, and it is not Common Market prices which are now affecting us. We are suffering because world prices have rocketed.
We were told about general food subsidies. They would cost approximately £2,000 million. Such a proposition is superficially attractive, but from where is the money to come? Should we print it? That means adding to inflationary pressure. What about increased taxation? That simply means reducing the incentives which at last have managed to get Britain out of stagnation and on the road to growth. That is not something which the British people would readily accept.
It has been suggested that we should freeze the Housing Finance Act, which ensures that no person shall be made to pay more than he can afford. If we are

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to freeze the costs of that Act we must freeze the benefits. Many of my constituents are enjoying the benefits of lower rents as a result of that Act.
A new property tax was also suggested Such a tax would be placed on top of mortgage repayments. That has not been thought through. On close examination the Opposition's proposals are no more likely to keep down the cost of food or the cost of living than Canute was successful in keeping the waves from carrying him up the beach. I only hope that the House of Harold, when it visits the trade union conferences this year, will be able to resist the temptation to urge them on, as in the past, to make inflationary wage demands.
8.33 p.m.
Mr. James Lamond: Despite the half-hearted attempts to defend the Government's record which we have heard from Government hon. Members, they must realise that inflation, as surely as night follows day, will bring about the downfall of their Government as soon as the electorate is given the opportunity to turn them down.
I base that assertion on my experience and on at least six by-elections in recent months, including the constituency represented by my hon. Friend the Member for Westhoughton (Mr. Stott), who today made an excellent maiden speech, and in particular the recent Manchester Exchange by-election. Government hon. Members cannot disregard the disastrous and humiliating result for the Tory Party at that by-election when all that it could scrape together were 683 votes. The reason for that—the Government must know the reason if they are in touch with the feelings of constituents—is the concern of the British people about rising prices, about inflation and particularly the prices of food, rents, clothes and other household goods.
The Government are so vulnerable to attack that it is difficult to select a topic to speak about. Food prices have been dealt with extremely effectively by my right hon. Friend the Member for Battersea, North (Mr. Jay). He outlined the real impact of entry into the Common Market on the cost of living and particularly the price of food.
I know that the Government have searched very long for excuses to give
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to the people about why they have not carried out their election promises. First, it was the so-called greedy requests of the trade union movement. Then they went a little lower. I recall one hon. Member opposite suggesting at one time that the small shopkeepers were forcing up prices. Today, we have again heard the fable that the working man is not passing on to his wife the whole of his wage increases. But whatever the excuses, perhaps we can now look at something where the Government can make a real impact—council house rents.
If the Government wished to do something quickly and effectively they could halt tomorrow the inflationary increases in council house rents. As my right hon. Friend the Leader of the Opposition said, in Oldham the report of the Rent Scrutiny Board bears out what Labour Members of Parliament have been alleging. Earlier this year we pointed out that council house rents would be doubled. In fact, in my constituency they will be 3½ times what they were in October last year.
Nothing concentrates the mind like an impending General Election, and in their search for something that could be done at a stroke, hon. Members opposite have seized on a number of things—for example, increasing the family income supplement. Some of them even want to do something about food subsidies, but most of them completely ignore the possibility of doing something about council house rents.
Why is it necessary for councils which have no deficit on their housing revenue accounts, and no need therefore to raise additional revenue from housing, to raise their rents? They do so against their own wishes and the wishes of the electorate which spoke so effectively in the recent local elections. Why is it necessary for the Government to force councils to push through further rent increases on top of those imposed in October last year?
Increases of 90p per week were forced on every tenant in my area. The local authority appealed to the Minister but he refused to see a deputation because, he said, he had nothing to discuss with it. It has behaved very responsibly, submitting proposals which it had arrived at in consultation with the local rent

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officer. But its proposals have been turned down and far more savage increases have been insisted upon.
The outcome of these increases in working-class budgets means that the man of the household who has to provide the money puts increasing pressure on his trade union to get further wage increases. Can the Government explain the logic? I appreciate that there are some factors outside the Government's control, but such things as council house rents are well within it, yet they do nothing about them. If they were to freeze rents, at least they would demonstrate that they were genuinely concerned about inflation and wanted to do something about it. It would be an easy step to take and would ensure that wage pressures were not so intensive as they might be otherwise, and it would also assist in keeping down the intensive agitation in many local authority areas about rent increases.
Hon. Members opposite claim that it has been difficult for local councils to get agitation started. In Oldham, which will be affected eventually by the Rent Scrutiny Board's report, because its findings must be taken into consideration by other boards in the area, a large number of tenants are still on rent strike against the 90p increase imposed last October. The newspapers in the area, including the Oldham Chronicle, which has fully reported all of this, have given the reactions of council tenant readers in the area. These have been very violent indeed.
I have no great desire to see this Government returned at the next election but if they do not wish to be annihilated and if they want to do something which will be constructive and of assistance to council tenants, they most certainly must, in the interests of one nation—the great vision of the Prime Minister—freeze rents as from tomorrow.
8.41 p.m.
Mr. Norman Lamont: It has been suggested that Shakespeare's sonnets could not have been written and the Pyramids could not have been built except in an age of inflation. It would be nice to think that at least this age will be one of artistic flowering. Most of us have to consider
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the issue in a more humdrum way. There is no doubt that the issue of inflation is one that threatens the functioning not just of our own economy but of the international economy. I do not think there has been sufficient appreciation of the extent to which the precarious inflationary situation in which we now find ourselves could turn quickly into precisely the opposite situation.
I turn briefly to one subject mentioned from the Labour benches which has been held responsible for part of our present inflation, namely, the Chancellor's decision to float the pound. Obviously, part of the 15 per cent. depreciation in sterling in the fifteen months' since the Smithsonian agreement has had an effect on retail prices. Equally obviously, that 15 per cent. effect is small compared with the total effect of the world increase in community prices of between 60 per cent. and 70 per cent. in the last year alone. Only a fraction of that percentage can be ascribed to the devaluation or depreciation of the floating pound.
The other day the right hon. Member for Birmingham, Stechford (Mr. Roy Jenkins) suggested that floating had become suspiciously fashionable. It was refreshing to find him in this new role of reacting against fashion. Most of us would have thought that he and his right hon. Friend the Member for Manchester, Cheetham (Mr. Harold Lever) who, alas, is not here, make a fairly fashionable pair in their opposition to floating. When they are joined by David Watt of the Financial Times I find it difficult to believe that all those gay blades campaigning together in favour of fixed exchange rates do not firmly indicate the way in which the tide of fashionable opinion is moving.
Leaving fashion aside, what are the arguments against floating? It is said that floating is not a painless cure—that it will not enable us to embark on unlimited expansion, ignoring the exchange rate. No one who was ever seriously in favour of floating suggested that it was a painless cure for our problems. Floating makes the need to contain inflation more pressing, not less.
It is said that the movement of the dollar and sterling in recent weeks has been out of all proportion to the movement in costs and prices. I wonder. I suspect it is wishful thinking on the

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part of politicians on both sides of the House. It is difficult at this time to say precisely what the rate for sterling ought to be. There have been too many changes, not just in our prices and costs but in the prices and costs of other countries and in the parities of other countries. But if sterling has moved too far down it is a wonderful opportunity for the Bank of England not just to act in the national interest in establishing a higher rate but also to make a large profit for itself. I suspect that the reason why sterling has moved down so quickly in recent weeks is simply that our interest rates have moved out of line with those of other countries.
Whereas our rates were formerly broadly comparable with those of other countries, they are now somewhat lower. I hope that the Treasury will bear in mind that our short-term interest rates, which do not affect industrial investment, do have an important effect on the exchange rate.
We should not allow ourselves to be panicked into trying to repeg the exchange rate because of the experience of the last few weeks. It is implied that the J curve effect has not been working. I am not sure that that analysis is right. The volume figures for exports have behaved exactly as one would expect with the J curve effect. It is true that officially the effect has been somewhat obscured by the movements of the values of imports through the increasing price of raw materials and imports.
Another difficulty is that when the economy is near to capacity it becomes more difficult to move resources into exports, and the advantages to be gained from further depreciation are less marked.
But these are not arguments for returning to a fixed parity. To do so would merely be to embark on the same cycle of forgoing growth and having to borrow money from abroad. In any case, no one can say precisely what the correct rate for sterling should be. The correct rate today would be wrong tomorrow, and tomorrow's rate would be wrong in six months' time. In this situation the answer is to do as the Chancellor of the Exchequer intends to do, namely, to support the pound within a band but not to commit us to a rate that would give speculators a one-way option and would be undermined in due time.
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In passing, may I say that I hope that the Chancellor of the Exchequer and the Government will give the most urgent attention to the question of the reform of the international monetary system. That is not just an abstract question which is of no consequence to ordinary people. Undoubtedly the unrest about the international monetary system in recent weeks has been one of the causes, through hedging, of booming commodity prices.
I hope that in our efforts to find a solution to the problem we shall not return to the old, tired formulae of the past, trying to paper over the cracks, and of weekend meetings in Basle which do more harm than good. We should have an end to what M. Debre has called "monetary tourism". What we need is a code for living in a world of dirty floating, because there is nothing incompatible between monetary stability and floating exchange rates, provided we can lay down on precisely what terms they are to be operated, including interest rates and capital movements.
Much of the debate has inevitably centred on the question of world inflation. The facts are clear. We have experienced the biggest commodity price explosion since the Korean War. That is shown by any index at which one cares to look. Reuters commodity index, which was 100 in 1931, was 500 a year ago and is 1,000 today. The Financial Times commodity index is up 70 per cent. The commodity index of the Economist has gone up 75 per cent. in a year.
The DTI's June figures showed that the average prices paid by United Kingdom manufacturing industry for raw materials and fuel rose by 3 per cent. in a month, to bring the rise to 27 per cent. for the year. That compares, one remembers nostalgically, with a rise for the whole of the previous year of only 1 per cent. Inside this year's total the average figure for the food industry's raw materials rose by 5 per cent. in June alone, making a total rise of 31 per cent. for the year. Obviously the wholesale price index has had to follow to a lesser extent.
There is no point in denying the effects of such a situation. Of course we must try to insulate people from those effects. We must consider the question of family allowances and we must increase family income supplement. I welcome what the

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Prime Minister said today about threshold agreements. But there is no point in ignoring or refusing to face the reality that commodity prices have contributed very significantly to the present inflation. It is difficult to estimate precisely and mathematically what part of our inflation is due to commodity prices, but it appears from the import content of the retail price index that a guestimate might be that 50 per cent. of the present rate of inflation could be due to rising import prices. In the present situation the Price Commission has had a vital rôle to play in lowering expectations and preventing the leap-frogging increases that could have occurred. That it has succeeded is shown by the way in which retail food prices have risen substantially less than imported food prices.
This debate has been unreal, because Labour Members have not wanted to know about international factors. They have said that they are irrelevant. They do not want to know about the world outside. Perhaps that is part of their own isolationism, of their "Little England "approach; they want to turn their backs on the world. They are not interested in what happens outside this country. In a way, that is rather strange, because those parts of the world in which they are interested are usually the parts where we have the least power to influence. So one might have expected them to have been interested in this question.
Their attitude is very different from their attitude when in government, when the Leader of the Opposition, the then Prime Minister, was always referring to international factors. How many times were the balance of payments figures explained away by, for instance, the Suez Canal's being shut. Even the right hon. Gentleman, on occasions, sought with less justification to excuse the rate of inflation by referring to the world-wide problems of rising prices. But his attitude to economic news was always selective: economic success came from himself but bad news was an act of God.
The present Government have reaffirmed their commitment to contain inflation. We are embarked on a programme that will bring us the growth which has eluded us for so long, and for that reason this Government are entitled to the support of this House.
8.51 p.m.
Mr. William Hamilton: It is perhaps appropriate in a debate of this kind that a merchant banker should be followed by the simple son of a coal miner. Because that is what this debate is about. It is about failure—about the deception and fraud perpetrated by this Government on the electorate in 1970. This document, "A Better Tomorrow", on which they won the election, is replete with lies, but it is the prospectus on which they won the election, a prospectus which they knew to be false, which they knew could not be implemented.
Nevertheless, the British people believed them and the British people voted for them on the strength of it. There are large numbers of Conservative Members holding marginal seats who will be out at the next election. Governments lose elections. Oppositions seldom win them. That will probably be the case at the next election.
The Government are quite right to say to us, "What are your proposals?" We are formulating them now.
Mr. Tugendhat: A bit late.
Mr. Hamilton: At least they will be honest. This Conservative document is not honest. Let me read out from it:
"Britain now faces the worse inflation for twenty years."
It did not. It is worse now than it ha been for 50 years. The document said:
"Our theme is to replace Labour's restrictions with Conservative incentive. We utterly reject the philosophy of compulsory wage control."
We have got it. In whatever field of policy we care to take, the Government's achievement is in flat contradiction to what was promised, in flat contradiction to the promises on which they won the election.
The most realistic speech, and one of the shortest—and perhaps it was the better for that—was the maiden speech of my hon. Friend the Member for West Bromwich (Miss Boothroyd). She has recently returned from the hustings. There has been a lot of sophisticated talk here about the floating pound, about the international monetary situation, about commodity price indices and the rest. No wonder the British public are disillusioned with that kind of talk coming

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from here. What they understand and what they read about every day in the newspapers is that we live in an unfair, unjust, extremely greedy, grabbing capitalist society where everybody grabs what he can.
The British public read about the dealings in Lonrho. They read about Lord Lambton and Lord Jellicoe. They read about the immorality and the greedy, grubby, selfish face of capitalism—and the merchant bankers do very well. They have not suffered from inflation. The people who have suffered most are not the very poor—although they have suffered enough—but the small savers who are spoken of in the Page Report, which has been played down by the Government. The unsophisticated saver who puts away a few bob a week in savings stamps has been robbed daily over the last quarter of a century, and that process has got worse under this Conservative Government. The simple, honest people know that the dishonest—the speculators—are getting away with it. That, in simple terms, is how ordinary people see our society developing.
The rich are getting richer because they know their way about. They know where are the Cayman Islands and all the other tax havens. They have good accountants who can fiddle their expenses. The ordinary fellow under PAYE has his tax deducted before he sees a penny of his wages.
My right hon. Friend the Chairman of the Parliamentary Labour Party said some years ago that there were two classes of taxpayers, the "pay-as-you-earn "and the "pay-as-you-like". That is still true. We saw it in the Lonrho affair. Hon. Members of the House were involved in the Lonrho affair—the Chairman of the 1922 Committee was right up to the neck in it. There is one now standing at the Bar. He said outside, with great glee, "You can get justice if you pay for it". One can get justice if one pays for it too. That is what he got—
Sir Gerald Nabarro Sir Gerald Nabarro (Worcestershire, South) rose—
Mr. Hamilton: The hon. Gentleman has just this minute come into the House—
Mr. Patrick Cormack: On a point of order, Mr. Deputy Speaker. Is
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it in order for the hon. Member for Fife, West (Mr. William Hamilton) to make snide personal accusations against hon. Members and not give them the opportunity to reply?
Mr. Deputy Speaker (Mr. E. L. Mallalieu): Order. It is unwise to canvas personal matters of this sort without a motion.
Mr. Hamilton: The debate up to now has been far too tame. I intend in the last few minutes to try to raise the temperature. I am making a positive contribution to the debate, which has long been absent.
The Government are under sentence of death. As soon as they have the guts to go to the people, the people will give them the answer. Six hundred of them voted for the Government in the Manchester Exchange Division, yet the Prime Minister has the cheek to stand at the Box this afternoon—being away from his "Morning Cloud"—and to say that the British people are behind him—all 600 of them! If he is so convinced, let him call for an election this autumn. He knows and we know that our society has got more unfair in the last three years than it has in the last quarter of a century. It is certainly now more divided that it has been for the past 30 or 40 years—and it has been divided by a Government who said that they would create one nation.
Inflation is hitting hardest the people who can afford to suffer it the least. There is not a single Conservative Member who has been hit by inflation. [HON. MEMBERS: "Nonsense".] Hon. Members opposite do not know what they are talking about. They have only to talk to the ordinary wage earner, the man on £20 or £30 a week, to know how he and his family are suffering.
All the noises we hear from the Government about protecting poorer people by improving the family income supplement is simply not good enough. That was one of the biggest frauds perpetrated by this Government. One Government Minister said he would be depressed if less than 85 per cent. of those entitled to the supplement did not take it up. But it is very much less than that, and only 65 per cent. of the people involved are taking up the supplement

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—which means that nearly half are not taking it up.
If the Prime Minister and his Government do not do something about family allowances and about the rent Acts, if they do not try to protect, without means-testing, those who are suffering most from the kind of inflation which the Tory Government have inflicted on our people, the Government will get what they deserve. And they will get it as soon as they have the guts to go to country.
9.3 p.m.
Mr. Edward Short (Newcastle-upon-Tyne, Central): I first wish to congratulate the two hon. Members who have chosen this debate to make their maiden speeches. I refer to my hon. Friends the Members for West Bromwich (Miss Boothroyd) and Westhoughton (Mr. Stott), both of whom made excellent speeches. I hope that we shall hear from them often in the House.
The debate was opened for the Government by the Prime Minister, who has just returned to the Chamber. I am glad that he is here, because I told him that I was going to talk a great deal about him. The right hon. Gentleman's speech was 53 minutes of nothing. I wonder whether this man is real. In listening to him today I received the overwhelming impression that this was Mike Yarwood imitating Ted Heath. This Prime Minister is not real; he is plastic. He has raked up more alibis in the last three years than Agatha Christie did in three decades.
The Prime Minister's speech was without compassion or comfort. It did not even contain a promise to the people whom he deceived three years ago. He offered no additional help for the poor or the unprotected. It was not a speech about people at all—no care, no compassion, no concern for the hardship he has caused for so many people by his incompetence.
Food prices, apparently, are an ugly rumour started by the poor and the Opposition. The right hon. Gentleman is not a Prime Minister; he is a caricature of a Prime Minister. He gives no leadership to Britain and no comfort to the people. There was not even an apology to the people who trusted him and who have been deceived by him.
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This debate is on the question whether the House has confidence in this Government and this Prime Minister to create a fair society. I want to talk mainly about people. The present Government have two records to their credit—if "credit" is the right word. They have presided over, and largely caused, the steepest rate of inflation in our history. Secondly, they have carried out the most massive redistribution of incomes to the rich in this century.
In "A Better Tomorrow" on which the Prime Minister won the election he said:
"We will reduce taxation…. We will concentrate on making progressive and substantial reductions in income tax. These reductions will be possible because we will cut out unnecessary Government spending and because we will encourage saving."
The Government have cut taxation. Their own figure is £3,000 million per annum, and that is the figure that I shall use. In order to do so they have, as they promised, concentrated on income tax. But because they have concentrated on income tax, the benefit gained from the cut by individuals has been in direct proportion to their incomes. The well-to-do have got a great deal out of it. The poorest of the poor have got nothing out of it. But although the tax cuts have concentrated largely on income tax. in the main they have not been paid for by the promised massive cuts in Government spending but by borrowing—at least £4,000 million this year, let alone the balance of payments—and also by a series of mean, nasty, miserable little cuts which, had they been selected to produce the minimum of saving and the maximum hardship for ordinary people. could not have been bettered.
Let me remind the Chancellor of the Exchequer of a little document published in October 1970 entitled "New Policies for Public Spending". Those policies included the ending of free milk in primary schools, the ending of cheap welfare milk—this by the housewife's friend who sits nodding his head on the Treasury bench—increasing dental charges and prescription charges, winding up the Consumer Council, and cutting out such bodies as the rural development boards.
These two elements of Government policy—concentrating on income tax and paying for the tax cuts by borrowing—

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have been the major cause of our appallingly high rate of inflation in the past three years which is causing the most acute hardship to people—not just poor people but people on average and below-average earnings.
In addition to this, in their early days the Government quite deliberately encouraged price increases. How often did we hear it said that people should pay realistic prices for their food?
Inflation today is not only acute. 1 expect that all hon. Members have detected a change of mood in the country over the past few weeks about inflation. There is real fear in the country about inflation. The Prime Minister grins. He has £400 a week. Inflation is a joke to him. The Chancellor of the Exchequer as a matter of deliberate policy has accelerated inflation, but the nature of his tax cuts has insulated the better-off from its effects. The price of food does not matter to anyone earning £80 a week, or £400 a week, as the Prime Minister does, but it matters a great deal to anyone earning only £15 a week.
The Chancellor of the Exchequer has tried to conceal the biggest ever redistribution of income by rationalising the tax system and by the claim that we hear so often—we heard it again today from the Prime Minister—that the Government have cushioned the most needy members of society against the worst effects of their policy by means of selective benefits.
Such monumental reforms as the unification of income tax and surtax and the substitution of VAT for selective employment tax and purchase tax—I believe that we are still paying all three—are not much comfort to the housewife trudging from shop to shop trying to save a few coppers. Has the Prime Minister ever seen old people going from shop to shop with a handful of coupons for special offers? I expect the Government call it "shopping around".
When we look at the actual value of the whole package of means-tested benefits, invalidity allowances, age-related pensions, extended old persons' pensions, improvements for the chronic sick, two-tier attendance allowances for the severely disabled, and even throw in family income supplement, we welcome them all, but they amount only to 5 per cent. of the £3,000 million which the Chancellor of
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the Exchequer has dispensed. All of them are welcome. But if the Government wanted to redistribute £3,000 million of purchasing power surely they could have found more than 4 per cent. to give to the most needy groups of all in our community. The Chancellor has given that to the poorest and 22 per cent. to the richest group in the community. Even if we take the whole 46 means-tested benefits together, they amount to only 16 per cent. of that £3,000 million.
But the Prime Minister's principal fig leaf in the cushioning claim is the assertion, which he made again today, that the Government have not only protected pensioners against the effects of their policy, but that in October the pensioners will actually have gained 25 per cent. in their standard of living since the Government came into office.
If the Prime Minister would come to my constituency and talk to the old people there he would understand how utterly phoney this is. Imagine the old lady who has saved up and purchased her own house. She is not eligible for a supplementary pension. She has to live on her retirement pension. Pensioners today who have to live on their retirement pensions, even with supplementary pensions, simply cannot afford to keep themselves warm and well-fed.
The claim about the 25 per cent. is false for three reasons. I shall explain what they are. Today, the Prime Minister claimed that from November 1969 to October 1973, when pensions go up, they will have risen by 55 per cent.—pensions ought to go up every month, not every year, under this Government—and that the cost of living will have gone up by only 30 per cent. I think that today the Prime Minister said 35 per cent. This is not true. The cost of living had gone up by 30 per cent. in March this year, and there is another six months of inflation to add. By October the retail price index is almost certain to indicate a rise of at least 40 per cent. That reduces the pensioner's real increase from 25 per cent. to 15 per cent.
But that is not the end of the story. In making this dishonest claim the Prime Minister uses the ordinary retail price index—he attempted to justify that today—not the special pensioners' index. The

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spending pattern of the pensioner is quite different from that of the ordinary householder. For example, pensioners do net often buy second-hand cars. If the pensioners' index is used instead of the ordinary retail price index the 15 per cent. is reduced to 10 per cent.
Again, that is not the end of the story. Even the pensioners' index is defective, because it excludes the increasing cost of housing. The recent family expenditure survey showed that on housing, pensioners' households spend almost as much as, and sometimes more than, the average household. Between November 1969 and March 1973 rent and rates increased by 36 per cent.
These three factors, about which the Prime Minister and the Secretary of State for Social Services—who is not here—keep very quiet, show that pensioners will have suffered at least a 45 per cent. increase in their cost of living by October. I have not attempted to quantify the third of those factors. Therefore, their 55 per cent. rise by October is worth, in real terms, £154 for the single pensioner and £2·42 for a couple over four years. So their magnificent annual share of three years of Tory prosperity amounts to a weekly increase of 38p per year for a single person and 60p per year for a married couple. What a commentary on the Government's claims to fairness in helping the poorest and the weakest members of society! Where is their share of the 5 per cent. growth? Where does the 5 per cent. growth go anyhow? The workers are not getting it. The pensioners are not getting it. What has happened to it?
Almost 1 million non-pensioners are so poor that they are getting supplementary benefits. This group and their dependants, together with the pensioners who get supplementary pensions, amount to 5 million people. In addition, it is estimated that 500,000 more pensioners are entitled to the supplementary pension but do not claim it, and that 350,000 people are entitled to supplementary benefit but do not claim it. So, including pensioners and dependants, we have the astounding figure of 6½ million people in our society who come within the official definition of poverty. One person in eight in our society is living in the official
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definition of poverty. The gulf between them and the more affluent has been enormously increased by the Chancellor's policy, and it is increasing every day that the Government stay in office.
The House will have seen an article in today's paper entitled "The Hungry Ones". It says:
"More than 1,500,000 of Britain's families arc not getting enough to eat,"
and so on. The number of poor is much greater than that alarming figure, and it is an indictment of our society that there are still vast numbers of low-paid workers and others who, with their families, are living in what we must call poverty in 1973 although they may not fall within the official definition.
In April last year—these are the latest figures published-2 million adult workers had a gross pay of less than £22 a week, and here, as in most other things, there is a gross regional imbalance. Most low-paid workers are in the development areas in the regions. At present, 46 per cent. of farm workers, 45 per cent. of catering trade workers, 37 per cent. of male nurses and a vast number of women are low paid. To find a cushion for them the Government went back to 1795, when the magistrates, at a place called Speenhamland, in Berkshire, made up to subsistence level the wages paid by the local farmers—FIS in the eighteenth century.
Only 84,000 people are claiming FIS, and so far it has not even dented the problem of poverty among low-paid workers. So far as we can tell, the poorest families of all are among the non-claimants. The current FIS rate is £21 for a worker with one child. The single worker and the married childless worker get nothing. A married worker with one child gets the difference between £21 and his wage. If a man earns £20 a week, and if he has one child, FIS amounts to the magnificent sum of 50p, and a single man gets nothing. [An HON. MEMBER: "That is more than you gave them."] But they could live during the time of the Labour Government.
Mr. Peter Tapsell: Will the right hon. Gentleman explain how he accounts for his claim that 1½ million people are not getting enough food to eat and yet only 86,000 have bothered to apply for FIS?
Mr. Short: I suggest that the hon. Gentleman reads the report to which I have referred.
There is another aspect of FIS—[Interruption.] The Chancellor wants to speak, and I shall finish what I have to say. FIS is one of the most potent elements in the poverty trap because no improvement in the rates or scales of FIS can alter the problem of a small pay rise taking earnings above the cut-off rate. On his own figure the Chancellor had £3,000 million to dispense. He looked around Britain, saw 2 million low-paid workers and decided that their share would be £12 million out of the £3,000 million, and to the 1 per cent. of the population who earn more than £5,000 a year he gave £750 million.
Not only have the poor not been cushioned and not had anywhere near their fair share of the nation's wealth, but the effect of Government policy almost daily makes their lives and the lives of all working people with below-average incomes more difficult, and increases the gulf between rich and poor. Let me briefly give five examples. First, the floating pound—or sinking pound—increases corporate profits derived from exports and at the same time pushes up food prices and depresses real earned incomes. So does the denial of access to cheap food by import duties. [HON. MEMBERS: "Where?"] The Prime Minister doubted this today, but in the few hours since he spoke I have acquired a list. No fewer than 27 categories of food are now subject to import duties or import levies. Hon. Members can look in HANSARD for 14th June to find them. These are now denying us access to cheese and butter markets, and to markets all over the world—[Interruption.] Regarding poultry and pig products, I shall inquire of the Polish and American Governments, and write to the Prime Minister. If I am wrong, I shall say so. But the case has been overwhelmingly made by these figures and by the speech of my right hon. Friend the Member for Battersea, North (Mr. Jay). If hon. Members want examples, there is a 40 per cent. levy on butter. It varies, but that is the latest of which we know. This denies us access to Australian butter. There is a £220 per ton levy on cheese. That denies us access to Canadian cheese. There are dozens, of examples of the same thing.
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Secondly, VAT is hitting the poor infinitely harder than the well off. Let us not hear the nonsensical argument that the pensioner can cut his VAT bill by abstinence. That is an extension of "Godber's law"—if one does not buy anything, one does not pay any VAT. Most pensioners have cut their expenditure to an absolute irreducible minimum.
Thirdly, in the last three years there has been an obscene property speculation in Britain. This has been entirely at the expense of wage earners. The Chancellor's device, announced in his Budget, was derisory. The Times said:
"Charge for hoarding will not hurt speculators."
The day after the Chancellor made his announcement, all property shares shot up like mad. From early 1971 to May 1973 bank advances to property speculators amounted to £1,500 million. After the Bank of England asked for restraint in this credit, they rose by another £500 million. In the main, this is a purely non-productive investment. Its only effect is to push up the price of existing property. It does not increase the rate at which housing becomes available; it reduces it. Its only effect is to siphon off income from wage earners to speculators.
Fourthly, the Government's prices and incomes policy also increases corporate profits at the expense of real earned incomes. The Prime Minister talked about his freeze. It is very interesting to see who got what during the freeze. There were some very interesting figures in a recent issue of the Department of Employment Gazette which show the amazing fact that during the freeze home-produced goods manufactured from home-produced raw materials rose in price by 2·5 per cent., while goods made from imported raw materials fell by 2·3 per cent. That certainly casts doubt on the current bogy of world prices, which has succeeded the trade union bogy, which is not now creditable.
From November 1972 to April 1973, in the freeze, there was without doubt a cut in the real standard of living for the majority of workers in this country. It has been variously estimated at between 0·5 per cent. and 2·7 per cent.; but it is probably about 1·5 per cent. Without doubt there will be a further fall during phase 2.

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It was at the end of the period of freeze on wages that the Chancellor had the cheek to distribute £300 million to the richest taxpayers, who own most of the capital anyway. Can any self-respecting trade union leader be criticised for doubting the good faith of a Government who act with such contemptible cynicism?
I turn finally to the Housing Finance Act. This is clearly a major instrument in the Government's policy of redistribution. It is admitted to be such by the Government. In this case the redistribution involves the council tenant, the private tenant and the owner-occupier. I wish to make absolutely clear that my colleagues and I do not object to, but welcome, help to tenants of private rented accommodation. The fact that it is now necessary to give this help is further proof, if any were needed, that landlordism is no longer a credible way of satisfying the housing need. Nor do we object to the owner-occupier getting help to buy his house. That is why we introduced the option mortgage scheme, which the next Labour Government will make universal.
We object to the council tenant's being made to pay for all of this. There are exceptions, but on the whole the council tenant cannot, under the Government, afford to become an owner-occupier. The average mortgage repayment today is £76.82 and the average deposit needed to buy a house, according to the latest Nationwide figures, is £3,225, which most council tenants cannot accumulate.
The Prime Minister: Is the right hon. Gentleman prepared to be put to the test and say whether his party and Labour councils will give council tenants the opportunity of buying their houses?
Mr. Short: We believe that it is utterly wrong to sell council houses in areas of housing stress. [An Hon. Member: "Humbug."] The hon. Member should talk of humbug. It is downright immoral for the Prime Minister to encourage councils to sell their houses in areas of housing stress.
These five aspects of the Government's current policy contribute to the depressing of living standards for the wage earners and, at the same time to the
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raising of living standards for the better off.
I wish to turn to another matter during the few minutes remaining to me. Prices and houses are important, but there is more to life than these two topics. The Government are not only redistributing wealth; they are also redistributing opportunity. I refer to their education policy. This debate is about a fair society, and an education policy is perhaps more relevant to a fair society and the quality of life than are most other services. The Secretary of State, who is the most reactionary Minister of Education of the century, has for three years used all her powers—and abused some of them—to prevent the ending of the 11-plus selection by local authorities. This is an evil system, which is inaccurate, divisive and wasteful of natural ability. There is no longer any argument about the need to end selection, even amongst Conservative local authorities, yet no one has told the Secretary of State. She sails merrily along, firing broadsides into any scheme that will give all children, especially poor children, the chance to develop their potential to the full. Because of her activities in the past three years, tens of thousands of children in Britain have each year to be branded as failures when they are no such thing. To tell a child that he is a failure often makes him one. This is an immoral system, perpetuated by a bigotted reactionary Tory Secretary of State. It is her major device to prevent children from State schools developing their potential to the full. But it is not the only device. The recent White Paper proposes to cut by half the number of teachers in training. The Secretary of State has already started on this process. This will not affect the independent schools; it will not affect the small teaching groups in schools like Eton and Harrow, but it will condemn State primary schools to classes of 40 and State secondary schools to classes of 30 in 1981. This is at a time—[Interruption.] I know that the hon. Gentleman is not interested in this, but many parents are.
The Secretary of State is doing this at a time when every trend in society calls for children to be taught as individuals. This is true whether we look at the changes in industry or at the changes in such things as attitudes towards

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morality in our society. How can our teachers give individual attention to their children in classes of this size? The Secretary of State, by her policy, is preventing our teachers from making their teaching relevant to the modern world.
Nor is that all. In her White Paper she is proposing to abandon the criteria we have used for some years for entry to the universities. The Department of Education and Science itself estimated that by 1981 there would be 835,000 students qualified—
Mr. Peter Rees: On a point of order, Mr. Speaker.
Hon. Members: Sit down!
Mr. Speaker: Order. I want to establish whether it is a point of order.
Mr. Peter Rees: If I were lucky enough to catch your eye, Mr. Speaker, would I be in order to discuss the White Paper on education?
Mr. Speaker: There is no chance of the hon. and learned Gentleman's catch-my eye in this debate.
Mr. Short: The Department of Education and Science estimated that by 1981, 835,000 places would be required. The Secretary of State is planning for 750,000—a quarter of a million too few. Clearly the Secretary of State thinks that the time has come to stop too many children from State schools from going on for higher education. Not content with these three negative policies—[Interruption.]
Mr. Speaker: Order. Is it not possible for both sides of the House to listen—[HON. MEMBERS: "Oh!"]—to arguments with which they do not agree in comparative silence?
Mr. Short: Not content with these three negative policies, the Secretary of State has given more financial help to the direct grant schools and the Chancellor has given help to the parents in independent schools. This has been paid for by withdrawing milk from primary schools.
These four aspects of Tory education policy are clearly and deliberately aimed at redistributing educational opportunities just as surely as the Chancellor's policy is aimed at redistributing wealth and income.
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Throughout this debate, in speech after speech, and from the Prime Minister's speech most of all, there has emerged the picture of a Government elected on fraudulent policies. Not only were they elected on fraudulent policies; they have abused the confidence of the electorate by intensifying the imbalance of living standards and opportunities which defaces our society in Britain. Their three years in office have seen a further steady polarisation of Britain into two nations—one which bears the burden of inflation, the other which is insulated against it; one which constantly improves the quality of life, and the other for which life is a series of dull, unsatisfying jobs, unskilled jobs, ill-paid jobs, spells of unemployment, a struggle to make ends meet, poor educational opportunities, poor environment, and insecurity.
The Opposition believe that this polarisation has gone so far and so deep that we shall never create one nation in Britain until we accord to every human being equal importance, equal dignity, and an equal right to a full and satisfying life. To do so will involve major structural changes in our economy, in our social services—especially in education—in our tax system, and, perhaps most of all, in our distribution of wealth, and not least of all in our attitudes of mind.
There is no hope of a radical change of attitudes of mind or of the economy, and there is certainly no hope of a change in the education system under this Government. There is no hope of change, because the Government want two nations—a nation of rich and a nation of poor; a nation of educated and a nation of uneducated; a nation of privileged and a national of unprivileged.
That is what Toryism is all about—the unequal distribution of wealth and opportunity. That is why neither we nor the country have any confidence in the Government to create a fair society.
9.35 p.m.
The Chancellor of the Exchequer (Mr. Anthony Barber): Once I learned that the debate was to be wound up by the Deputy Leader of the Opposition I realised that the Labour Party was determined to maintain a low, some would say an invisible, profile. We have not been disappointed. For a censure debate it has been remarkably quiet. At one

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stage there was only one person on the Opposition Front Bench—and he was a junior Whip—listening to this debate on an Opposition censure motion.
However, I have the pleasure at the outset of congratulating the hon. Member for West Bromwich (Miss Boothroyd) and the hon. Member for Westhoughton (Mr. Stott) on their maiden speeches. The hon. Member for West Bromwich spoke with considerable knowledge of the industry in her new constituency. She approved of the principle of threshold agreements and she said—I do not think I am being unfair—one or two things which some might say bordered on the controversial. Nevertheless, like me she comes from Yorkshire, and I give her a particular welcome. The hon. Member for Westhoughton also made a spirited and well-delivered speech and he had something to say about living standards. I shall come back to this point. However I congratulate both hon. Members and say that we look forward to listening to them again.
Mr. William Price: That is more than we can say about the right lion. Gentleman.
Mr. Barber: Several speakers, including the Leader of the Opposition, have referred to living standards and I want to refer to that, too. My right hon. Friend the Prime Minister made clear this afternoon why we reject the Opposition's philosophy of subsidising those with above-average earnings from paying fair rents and doing so with subsidies which will be paid for by the self-same people through taxation. There is therefore no question of abandoning the next step towards fair rents, which is due in October. We shall continue our policy of giving special help to those tenants who need it. In April we increased the needs allowance under the national rent rebate scheme by £3·50 a week. As a result, a married man with two children living in a council house, with an average or above-average rent and earning £35 a week, would not normally be paying more rent on the present basis by the end of October this year than he was paying before April, even though the rent of his dwelling will have increased. Many tenants with the rebate will be paying less rent.
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The Government now propose to give further help by making a further increase in the needs allowance from October 1973. We are proposing an increase of £1.50 a week for a single tenant, £2·50 for a married couple and an additional 25p for every dependent child. My right hon. Friends will immediately consult the Advisory Committee on Rent Rebates and Rent Allowances about these proposals with a view to laying the necessary amending regulations before the House. The broad effect will be that most of the 1 million council and private tenants not on supplementary benefit but who are at present receiving a rent rebate or allowance will get a reduction in their rent averaging about 45p a week. For those of them who are due for an increase in the rent—
Mr. Skinner Mr. Skinner rose—
Mr. Barber: I want to complete this passage first, and then the hon. Gentleman is the one man to whom I will willingly give way.
For those who are due for an increase in the rent of their dwelling in October, the effect of the increased needs allowance will be that on average they will pay about 25p less in rent after the rent increase in October than before it. Some council and private tenants will become eligible for a rebate or allowance for the first time.
The increases will give special help to families with children. The great majority of lower-paid workers with children are tenants, and the increase in the needs allowance for each dependent child is therefore of direct help to those families. For instance, a married couple with two dependent children and an income of £35 a week, living in a council house at a rent of £3·50, now pay the whole £3·50 themselves. Under the new proposals they will pay only £2·80. If the rent of their house goes up by 50p to £4, they will pay only £3 themselves, 50p less than now. We have no doubt that this is by far and away the best way to help those people in need.
Mr. Skinner: The Chancellor has been very selective with his carefully worked out examples of those who will benefit as a result of the increase in the needs allowance. He will agree that for a single man receiving an extra £1·50 on the needs allowance a swift calculation,

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even by his unimaginative mind, will produce only three times 81p, which means 25½p when the increase is 50p in October. Therefore, he will be that much worse off as a result.
The other point the Chancellor should bear in mind—[HON. MEMBERS: "Too long."]—is that when the Prime Minister asked the TUC to meet him a few weeks ago both he and the Chancellor made it abundantly clear that if the TUC came to Downing Street it would be allowed to discuss absolutely anything it wished. [HON. MEMBERS: "Speech By announcing this decision tonight, the right hon. Gentleman has ruled out any reductions that can take place under the Housing Finance Act.
Mr. Barber: On the first point the hon. Gentleman is wrong. On the second point, which Opposition Members cheered, the fact is that if we had not made the announcement before the House rose it could not have been operative in October. That is the sole reason it was made now.
Practically every speech in the debate has been concerned with one or other aspect of the two principal objectives of economic policy—first, the determination to jack up our rate of economic expansion, as being the only means by which we or any nation can improve our prosperity, and, secondly, as a great trading nation in a situation in which the worldwide pace of inflation has speeded up dramatically, to take such action as is available to us to contain our domestic costs and prices consistent with—this is the important point—a policy of sustained growth.
I readily accept that it would be open to any Government to provide massive, across-the-board subsidies to hold down certain prices of food for rich and poor alike, but it is a complete illusion to pretend that this can be done without also levying massive, across-the-board increases in taxation.
I shall return to that theme, but first I hope that the whole House will accept that the benefit to the British people of pursuing a policy of economic expansion has been very great. I hope that in fairness the Opposition will also accept that, whatever the problems resulting from the unprecedented increase in world prices, over which we have no control, we have
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been able to secure for our people a far greater improvement in their real living standards than they, with their different policies, were able to achieve, when in office. This debate has crystallised the fact that on both sides of the House there is a deep, fundamental and wholly different approach to the problems which any British Government, Labour or Conservative, must tackle.
The Opposition motion refers to the creation of a fair and just society. What is most significantly omitted from the motion is any reference to the creation of national wealth, which is the prerequisite of such a society. That is not surprising when it is remembered that throughout the six years of Labour Government the economy grew on average at the rate of only 2½ per cent. a year. The trouble with Labour Governments is that they always begin to fight over the national cake before they have even begun to bake it.
It was a prime objective of the economic policy of the present Government to break out from the era of stagnation which resulted in our living standards falling further and further behind those of other industrialised nations. We have only to look at the various steps which have been taken during the last three years to recognise that that has been achieved.
Mr. Russell Kerr: Who wrote this rubbish?
Mr. Barber: On the basis which is common to both Governments of real personal disposable income, the standard of the British people has risen more in the past three years than in the last Labour Government's six years. [Interruption.] If right hon. and hon. Members will listen I shall give one of the most significant comparisons which can be made. The right hon. Member for Newcastle-upon-Tyne, Central (Mr. Edward Short) referred to those who arc on average industrial earnings. The fact is that after almost six years of Labour Government a family with two young children on average industrial earnings was in real terms only 80p a week better off-80p after six years. Since 1970, after three years of Conservative Government, the latest figures show that the same family is already better off in real terms, taking into account increases in

615
prices, to the extent not of 80p a week but of £2·29 a week. In other words, average real earnings, despite the rise in the cost of living, have gone up almost three times as much in half the time.
Considerable reference was made by the Leader of the Opposition to food subsidies. He was asked certain questions. First, it is clear that not one hon. Member—this is also made clear by the document which was produced by the Labour Party—pretends for one moment that there is anything which we can do about the rise in world prices. But, say the Opposition, the Government must introduce food subsidies. The Government have never been doctrinaire about subsidies. We have at various times subsidised particular foods, such as milk, potatoes, and butter.
The nation should be under no illusion that if we were to go in for the sort of massive across-the-board subsidies which have been spoken of by the Leader of the Opposition and the Deputy Leader of the Opposition, subsidies benefiting rich and poor alike, such a burden would involve massive across-the-board increases in taxation.
If we introduced such subsidies we should be right back again on the old Socialist treadmill of ever-increasing rates of taxation. I quote part of a speech which the right hon. Member for Newcastle-upon-Tyne, Central made recently at Be1per. He said:
"Subsidies will be costly and will have to be paid for by re-imposing some of the taxes Mr. Heath has removed from the higher income groups."
All right! Is that what the Labour Party would do? Would it reimpose some of the taxes removed from the higher income groups, and on them only? No one believes that, not even the Deputy Leader of the Opposition. Let the House listen to these words, which do represent the truth, from someone sitting on the Opposition Front Bench at this moment.
"We have to be frank. … When a Labour Government is in office there will be relatively high levels of taxation and local rates and national insurance contributions…. We can no longer pay for higher expenditure just by soaking the rich."
Now we know. Those were the words of the man who came top in the Shadow Cabinet elections last year—the right hon.
616
Member for East Ham, North (Mr. Prentice).
Mr. Reg Prentice: As the right hon. Gentleman has quoted what I said, will he defend the social morality of the tax concessions which took effect in April in the context of a situation in which the pensioners and the lower paid are having to pay the highest food prices they have ever known?
Mr. Barber: All I can say to the right hon. Gentleman as far as that is concerned—[HON. MEMBERS: "Answer."] I am answering. As far as that is concerned, I believe, in the context of the massive reductions we have made, that what we did this year, as in previous years, is perfectly fair.
The Deputy Leader of the Opposition told us that with food subsidies there would be no need for an incomes policy. He mentioned a figure of "up to £500 million". Does he really think that a subsidy of a little over 15p a week per head of the population would dispense altogether with the need for an incomes policy? Such a proposition by the Deputy Leader of the Opposition is almost too ludicrous to merit consideration. I am not in the least surprised that the Shadow Chancellor, the right hon. Member for Leeds, East (Mr. Healey) decided to have nothing whatever to do with this debate.
What does all this talk by the Deputy Leader of the Opposition of the cost of his proposed food subsidies mean when he says that it would be "up to £500 million"? His proposals are not the proposals of the Leader of the Opposition, whose speech today, if I may say so, was not quite up to the high standard of his speech yesterday on Mozambique. He is not limiting the subsidies which he wants to see to those items set out so carefully by the Deputy Leader of the Opposition. He, unlike his deputy, says that he also wants to have subsidies on meat. He mentioned beef, pork and lamb specifically. Where does his deputy stand on that? Where does the Shadow Chancellor stand on that? They both know that one could not do it for £500 million a year.
Mr. Harold Wilson: Where does the Chancellor stand on that?
Mr. Barber: We are opposed to it for the reasons I have given.

617
That is not all, because the Leader of the Opposition said today nothing whatever about fish. Yet last Friday on television to the nation he said that he would consider subsidising fish. What does the Deputy Leader of the Opposition think about that? What does the Shadow Chancellor think about that? I will tell the House what I think. We are not prepared to go in for the massive increases in taxation which would be necessary—but, to be fair to the Leader of the Opposition, he has made it abundantly clear that so far as he is concerned there is no such limit as £500 million. The cost, he says, is for decision not now but later.
What would the joint policy of the right hon. Gentlemen have cost over this past year? The Deputy Leader of the Opposition's subsidies of £500 million did not include meat and fish. But, assuming that he is right, and we then include what the Leader of the Opposition has said—that is, including carcase meat—and assuming that we could have kept to the price levels over the past year, that would have cost the British taxpayer a further £500 million a year. If one includes fish, which the right hon. Gentleman told the electors the Opposition would consider, the cost would total some £1,100 million in a year which is just about the same amount—
Mr. Harold Wilson Mr. Harold Wilson rose—
Mr. Barber: I will give way in a minute.
Mr. Speaker: Order. Can we have four minutes of silence?
Mr. Barber: I have said that I will give way to the Leader of the Opposition. He is fair, and I know that he will not take up the whole time. What I am saying is that the joint proposals of the Leader and the Deputy Leader the Opposition—[HON. MEMBERS: "Give way" If hon. Members want me to give way, they have only to wait. The joint proposals of the Leader and
Deputy Leader of the Opposition, if they had kept prices stable over the past year, would have cost £1,100 million. To put it into perspective, that is almost the same as the full year cost of the cut in income tax which I made last year and which provided every taxpayer throughout the land with an income tax cut of £1 a week. The weekly wage earner had better know what would be in store for him with the return of a Labour Government. It would be back to 1968 with a vengeance.
Mr. Harold Wilson: The right hon. Gentleman calculates a cost of £1,100 million. Will he tell me and the House how much has accrued in each year of his Government's administration to the land and property speculators? If he were to take that back from them, he could pay for these proposals.
Mr. Barber: The right hon. Gentleman knows perfectly well from the answer of his right hon. Friend the Member for East Ham, North that that is not so.
Inflation is rightly a matter of great concern, but that is not the reason why the Labour Party have instigated this debate. The real reason is simply that the Labour Party will miss no chance to run this country down, to run down its achievements. The hallmark of the Labour Party is failure. Their term of office reeked of failure. In Opposition, they are desperately willing failure. But the British public reject the philosophy of failure peddled by the Labour Party. This Government have a record in which the House will tonight express its confidence. So too, when the time comes, will the British people.
Question put,
That this House has no confidence in the ability of Her Majesty's Government to control the rising price of food and the cost of other essentials, to maintain the value of the pound at home or abroad, and to create a fair and just society.
The House divided: Ayes 288, Noes 314.

Division No. 206.]

AYES

[10.0 p.m.

Abse, Leo

Bagler, Gordon A. T.

Bidwell, Sydney

Allaun, Frank (Salford, E.)

Barnes, Michael

Bishop, E. S.

Allen, Scholefield

Barnett, Guy (Greenwich)

Blenkinsop, Arthur

Archer, Peter (Rowley Regis)

Barnett, Joel (Heywood and Royton)

Boardman, H. (Leigh)

Armstrong, Ernest

Baxter, William

Booth, Albert

Ashley, Jack

Beaney, Alan

Boothroyd, Miss B. (West Brom.)

Ashton, Joe

Senn, Rt. Hn. Anthony Wedgwood

Bottomley, Rt. Hn. Arthur

Atkinson, Norman

Bennett, James(Glasgow, Bridgeton)

Boyden, James (Bishop Auckland)

Bradley, Tom

Hart, Rt. Hn. Judith

Morris, Rt. Hn. John (Aberavon)

Broughton, Sir Alfred

Hattersley, Roy

Moyle, Roland

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

Healey, Rt. Hn. Denis

Mulley, Ht. Hn. Frederick

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

Heffer, Eric S.

Murray, Ronald King

Brown, Ronald (Shoreditch & F'bury)

Hilton, W. S.

Oakes, Gordon

Buchan, Norman

Hooson, Emlyn

Ogden, Eric

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

Horam, John

O'Halloran, Michael

Butler, Mrs. Joyce (Wood Green)

Houghton, Rt. Hn. Douglas

O'Malley, Brian

Campbell, I. (Dunbartonshire, W.)

Howell, Denis (Small Heath)

Oram, Bert

Cant, R. B.

Huckfield, Leslle

Orbach, Maurice

Carmichael, Neil

Hughes, Rt. Hn. Cledwyn (Anglesey)

Orme, Stanley

Carter, Rey (Birmingh'm, Northfield)

Hughes, Mark (Durham)

Oswald, Thomas

Carter-Jones, Lewis (Eccles)

Hughes, Robert (Aberdeen, N.)

Owen, Dr. David (Plymouth, Sutton)

Castle, Rt. Hn. Barbara

Hughes, Roy (Newport)

Padley, Walter

Clark, David (Colne Valley)

Hunter, Adam

Paget, R. T.

Cocks, Michael (Bristol, S.)

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

Palmer, Arthur

Cohen, Stanley

Janner, Greville

Pannell, Rt. Hn. Charles

Coleman, Donald

Jay, Rt. Hn. Douglas

Pardoe, John

Concannon, J. D.

Jeger, Mrs. Lena

Parker, John (Dagenham)

Conlan, Bernard

Jenkins, Hugh (Putney)

Parry, Robert (Liverpool, Exchange)

Corbet, Mrs. Freda

Jenkins, Rt. Hn. Roy (Stechford)

Pavitt, Laurie

Cox, Thomas (Wandsworth, C.)

John, Brynmor

Pearl, Rt. Hn. Fred

Crawshaw, Richard

Johnson, Carol (Lewisham, S.)

Pendry, Tom

Cronin, John

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

Perry, Ernest G.

Crosland, Rt. Hn. Anthony

Johnson, Walter (Derby, S.)

Prentice, Rt. Hn. Reg.

Crossman, Rt. Hn. Richard

Johnston, Russell (Inverness)

Prescott, John

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

Jones, Barry (Flint, E.)

Price, William (Rugby)

Cunningham, Dr. J. A. (Whitehaven)

Jones, Gwynoro (Carmarthen)

Probert, Arthur

Dalyell, Tam

Jones, T. Alec (Rhondda, W.)

Radice, Giles

Darling, Rt. Hn. George

Judd, Frank

Reed, D. (Sedgefield)

Davidson, Arthur

Kaufman, Gerald

Rees, Merlyn (Leeds, S.)

Davies, Denzil (Llanelly)

Kelley, Richard

Rhodes, Geoffrey

Davies, G. Elfed (Rhondda, E.)

Kerr, Russell

Richard, Ivor

Davies. Ifor (Gower)

Kinnock, Neil

Roberts, Albert (Normanton)

Davis, Clinton (Hackney, C.)

Lamble, David

Roberts,Rt.Hn.Goronwy(Caernarvon)

Davis, Terry (Bromsgrove)

Lamborn, Harry

Robertson, John (Paisley)

Deakins, Eric

Lamond, James

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

de Freitas, Rt. He. Sir Geoffrey

Latham, Arthur

Rodgers, William (Stockton-on-Tees)

Delargy, Hugh

Lawson, George

Roper, John

Dell, Rt. Hn. Edmund

Leadbitter, Ted

Rose Paul B.

Dempsey, James

Lee, Rt. Hn. Frederick

Ross, Rt. Hn. William (Kilmarnock)

Doig, Peter

Leonard, Dick

Rowlands, Ted

Dormand, J. D.

Lestor, Miss Joan

Sandelson, Neville

Douglas, Dick (Stirlingshire, E.)

Lever, Rt. Hn. Harold

Sheldon, Robert (Ashton-under-Lyne)

Douglas-Mann, Bruce

Lewis, Arthur (W. Ham, N.)

Shore, Rt. Hn. Peter (Stepney)

Driberg, Tom

Lewis, Ron (Carlisle)

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

Duffy, A. E. P.

Lipton, Marcus

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

Dunn, James A.

Lomas, Kenneth

Silkin, Rt. Hn. John (Deptford)

Dunnett, Jack

Loughlin, Charles

Silkin, Hn. S. C. (Dulwich)

Eadie, Alex

Lyon, Alexander W. (York)

Sillars, James

Edelman, Maurice

Lyons, Edward (Bradford, E.)

Silverman, Julius

Edwards, Robert (Bilston)

Mabon, Dr. J. Dickson

Skinner, Dennis

Edwards, William (Merioneth)

McAliskey, Mrs. Bernadette

Smith, Cyril (Rochdale)

Ellis, Tom

McBride, Neil

Smith, John (Lanarkshire, N.)

English, Michael

McCartney, Hugh

Spearing, Nigel

Evans, Fred

McElhone, Frank

Spriggs, Leslie

Ewing, Harry

McGuire, Michael

Stallard, A. W.

Faulds, Andrew

Machin. George

Steel, David

Fernyhough, Rt. Hn. E.

Mackenzie, Gregor

Stewart, Donald (Western Isles)

Fitch, Alan (Wigan)

Mackle, John

Stewart, Rt.Hn. Michael (Fulham)

Fletcher, Raymond (Ilkeston)

Mackintosh, John P.

Stoddart, David (Swindon)

Fletcher, Ted (Darlington)

Maclennan, Robert

Stonehouse, Rt. Hn. John

Foot, Michael

McMillan, Tom (Glasgow, C.)

Stott, Roger (Westhoughton)

Ford, Ben

McNamara, J. Kevin

Strang, Gavin

Forrester, John

Mabon, Simon (Bootle)

Strauss, Rt. Hn. G. R.

Fraser, John (Norwood)

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

Summerkill, Hn. Dr. Shirley

Freason, Reginald

Marks, Kenneth

Swain, Thomas

Galpern, Sir Myer

Marquand, David

Taverne, Dick

Garrett, W. E.

Marsden, F.

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

Gilbert, Dr. John

Marshall, Dr. Edmund

Thomas, Jeffrey (Abertillery)

Ginsburg, David (Dewsbury)

Mason, Rt. Hn. Roy

Tinn, James

Gordon Walker, Rt. Hn. P. C.

Mayhew, Christopher

Tomney, Frank

Gourlay, Harry

Meacher, Michael

Torney, Tom

Grant, George (Morpeth)

Mellish, Rt. Hn. Robert

Tuck, Raphael

Grant, John D. (Islington, E.)

Mendelson, John

Urwin, T. W.

Griffiths, Eddie (Brightside)

Mikardo, Ian

Varley, Eric G.

Grimond, Rt. Hn. J.

Millan, Bruce

Wainwright, Edwin

Hatton, F.

Miller, Dr. M. S.

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

Hamilton, James (Bothwell)

Milne, Edward

Walker, Harold (Doncaster)

Hamilton, William (Fife, W.)

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

Wallace, George

Hamling, William

Morgan, Elystan (Cardiganshire)

Watkins, David

Hannan, William (G'gow, Maryhill)

Morris, Alfred (Wythenshawe)

Weitzman, David

Hardy, Peter

Morris, Charles R. (Openshaw)

Wellbeloved, James

Harper, Joseph

Wells, William (Walsall, N.)

620

621

White, James (Glasgow, Pollok)

Williams, Mrs. Shirley (Hitchin)

Woof, Robert

Whitehead, Phillip

Williams, W. T. (Warrington)

Whitlock, William

Wilson, Alexander (Hamilton)

TELLERS FOR THE AYES:

Willey, Rt. Hn. Frederick

Wilson, Rt. Hn. Harold (Huyton)

Mr. Walter Harrison and

Williams, Alan (Swansea, W.)

Wilson, William (Coventry, S.)

Mr. John Golding.

NOES

Adley. Robert

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

Kilfedder, James

Alison, Michael (Barkston Ash)

Emery, Peter

Kimball, Marcus

Allason, James (Hemel Hempstead)

Eyre, Reginald

King, Evelyn (Dorset, S.)

Amery, Rt. Hn. Julian

Farr, John

King, Tom (Bridgwater)

Archer, Jeffrey (Louth)

Fell, Anthony

Kinsey, J. R.

Astor, John

Fenner, Mrs. Peggy

Kirk, Peter

Atkins, Humphrey

Fidler, Michael

Kitson, Timothy

Awdry, Daniel

Finsberg, Geoffrey (Hampstead)

Knight, Mrs. Jill

Baker, Kenneth (St. Marylebone)

Fisher, Nigel (Surbiton)

Knox, David

Baker. W. H. K. (Banff)

Fletcher-Cooke, Charles

Lamont, Norman

Balniel, Rt. Hn. Lord

Fookes, Miss Janet

Lane, David

Barber, Rt. Hn. Anthony

Fortescue, Tim

Langford-Holt, Sir John

Batsford, Brian

Foster, Sir John

Le Merchant, Spencer

Beamish, Col. Sir Tufton

Fowler, Norman

Lewis, Kenneth (Rutland)

Bell, Ronald

Fox, Marcus

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

Bennett, Sir Frederic (Torquay)

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

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

Bennett, Dr. Reginald (Gosport)

Fry, Peter

Longden, Sir Gilbert

Benyon, W.

Galbraith, Hn. T. G. D.

Loverldge, John

Berry, Hn. Anthony

Gardner, Edward

Luce, R. N.

Biffen, John

Gibson-Watt, David

McAdden, Sir Stephen

Biggs-Davison, John

Gilmour, Ian (Norfolk, C.)

MacArthur, Ian

Bicker, Peter

Gilmour, Sir John (Fife, E.)

McCrindle, R. A.

Boardman, Tom (Leicester, S.W.)

Glyn, Dr. Alan

McLaren, Martin

Boscawen, Hn. Robert

Goodhart, Philip

Maclean, Sir Fitzroy

Bossom, Sir Clive

Gerst, John

McMaster, Stanley

Bowden, Andrew

Gower, Raymond

Macmillan,Rt.Hn.Maurice(Farnham)

Braine, Sir Bernard

Grant, Anthony (Harrow, C.)

McNair-Wilson, Michael

Bray, Ronald

Gray, Hamish

McNair-Wilson, Patrick (New Forest)

Brewis, John

Green, Alan

Madden, Martin

Brinton, Sir Tatton

Grieve, Percy

Model, David

Brocklebank-Fowler, Christopher

Griffiths, Eldon (Bury St. Edmunds)

Maginnis, John E.

Brown, Sir Edward (Bath)

Grylls, Michael

Marples, Rt. Hn. Ernest

Bruce-Gardyne, J.

Gummer, J. Selwyn

Marten, Nell

Bryan, Sir Paul

Gurden, Harold

Mather, carol

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

Hall, Miss Joan (Keighley)

Maude, Angus

Buck, Antony

Hall, Sir John (Wycombe)

Maudling, Rt. Hn. Reginald

Bullus, Sir Eric

Hall-Davis, A. G. F.

Mawby, Ray

Burden, F. A.

Hamilton, Michael (Salisbury)

Meyer, Sir Anthony

Butler, Adam (Bosworth)

Hannam, John (Exeter)

Mills, Peter (Torrington)

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

Harrison, Brian (Maldon)

Mills, Stratton (Belfast, N.)

Carlisle, Mark

Harrison, Col. Sir Harwood (Eye)

Miscampbell, Norman

Carr, Rt. Hn. Robert

Haselhurst, Alan

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

Cary, Sir Robert

Hastings, Stephen

Mitchell, David (Basingstoke)

Channon, Paul

Havers, Sir Michael

Moate, Roger

Chapman, Sydney

Hawkins, Paul

Molyneaux, James

Chataway, Rt. Hn. Christopher

Hay, John

Money, Ernie

Chichester-Clark, R.

Hayhoe, Barney

Monks, Mrs. Connie

Churchill, W. S.

Heath, Rt. Hn. Edward

Monro, Hector

Clark, William (Surrey, E.)

Heseltine, Michael

Montgomery, Fergus

Clarke, Kenneth (Rushcliffe)

Hicks, Robert

More, Jasper

Cockeram, Eric

Higgins, Terence L.

Morgan, Geraint (Denbigh)

Cooke, Robert

Hilley, Joseph

Morgan-Giles. Rear-Adm.

Coombs, Derek

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

Morrison, Charles

Cooper, A. E.

Hill, S. James A. (South'pton, Test)

Mudd, David

Cordle, John

Holland, Philip

Murton, Oscar

Corfield, Rt. Hn. Sir Frederick

Holt, Miss Mary

Nabarro, Sir Gerald

Cormack, Patrick

Hordern, Peter

Neave, Airey

Costain, A. P.

Hornby, Richard

Nicholls, Sir Harmer

Critchley, Julian

Hornsby-Smith,Rt. Hn.Dame Patricia

Normanton, Tom

Crouch, David

Howe, Rt. Hn. Sir Geoffrey

Nott, John

Crowder, F. P.

Howell, David (Guildford)

Onslow, Cranley

Davies, Rt. Hn. John (Knutsford)

Howell, Ralph (Norfolk, N.)

Oppenheim, Mrs. Sally

d'Avigdor-Goldsmid, Sir Henry

Hunt, John

Orr, Capt. L. P. S.

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

Hutchison, Michael Clark

Osborn, John

Dean, Paul

Iremonger, T. L.

Owen, Idris (Stockport, N.)

Deedes, Rt. Hn. W. F.

Irvine, Bryant Godman (Rye)

Page, Rt. Hn. Graham (Crosby)

Digby, Simon Wingfield

James, David

Page, John (Harrow, W.)

Dixon, Piers

Jenkin, Rt. Hn.(W'st'd & W'df'd)

Parkinson, Cecil

Dodds-Parker, Sir Douglas

Jennings, J. C. (Burton)

Peel, Sir John

Douglas-Home, Rt. Hn. Sir Alec

Jessel, Toby

Percival, Ian

Drayson, G. B.

Johnson Smith, G. (E. Grinstead)

Peyton, Rt. Hn. John

du Cann, Rt. Hn. Edward

Jones, Arthur (Northants, S.)

Pike, Miss Mervyn

Dykes, Hugh

Jopling, Michael

Pink, R. Bonner

Eden, Rt. Hn. Sir John

Joseph, Rt. Hn. Sir Keith

Pounder, Rafton

Edwards, Nicholas (Pembroke)

Kaberry, Sir Donald

Powell, Rt. Hn. J. Enoch

Elliot, Capt. Walter (Carshalton)

Kellett-Bowman, Mrs. Elaine

Price, David (Easlleigh)

Kershaw, Anthony

622

623

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

Shersby, Michael

Tugendhat, Christopher

Proudfoot,Wilfred

Simeons, Charles

Turton, Rt. Hn, Sir Robin

Pym, Rt. Hn. Francis

Sinclair, Sir George

van Straubenzee, W. R.

Quennell, Miss J. M.

Skeet, T. H. H.

Vaughan, Dr. Gerard

Ralson, Timothy

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

Vickers, Dame Joan

Ramsden, Rt. Hn. James

Soref, Harold

Waddington, David

Rawlinson, Rt. Hn. Sir Peter

Speed, Keith

Walder, David (Clitheroe)

Redmond, Robert

Spence, John

Walker, Rt. Hn. Peter (Worcester)

Reed, Laurance (Bolton, E.)

Sproat, lain

Walker-Smith, Rt. Hn. Sir Derek

Rees, Peter (Dover)

Stainton, Keith

Wall, Patrick

Rees-Davies, W. R.

Stanbrook, Ivor

Walters, Dennis

Renton, Rt. Hn. Sir David

Stewart-Smith, Geoffrey (Beiper)

Ward, Dame Irene

Rhys Williams, Sir Brandon

Stodart, Anthony (Edinburgh, W.)

Warren, Kenneth

Ridley, Hn. Nicholas

Stokes, John

Wells, John (Maidstone)

Ridsdale, Julian

Stuttaford, Dr. Tom

White, Roger (Gravesend)

Rippon, Rt. Hn. Geoffrey

Sutcliffe, John

Whitelaw, Rt. Hn. William

Roberts, Michael (Cardiff, N.)

Tapsell, Peter

Wiggin, Jerry

Roberts, Wyn (Conway)

Taylor, Sir Charles (Eastbourne)

Wilkinson, John

Rodgers, Sir John (Sevenoaks)

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

Winterton, Nicholas

Rossi, Hugh (Hornsey)

Taylor, Frank (Moss Side)

Wolrige-Gordon, Patrick

Rost, Peter

Taylor, Robert (Croydon, N.W.)

Wood, Rt. Hn. Richard

Royle, Anthony

Tebbit, Norman

Woodhouse, Hn. Christopher

Russell, Sir Ronald

Temple, John M.

Woodnutt, Mark

St. John-Stevas, Norman

Thatcher, Rt. Hn. Mrs. Margaret

Worsley, Marcus

Sandys, Rt. Hn. D.

Thomas, John Stradling (Monmouth)

Wylie, Rt. Hn. N. R.

Scott, Nicholas

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

Younger, Hn. George

Scott-Hopkins, James

Thompson, Sir Richard (Croydon, S.)

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

Tilney, John

TELLERS FOR THE NOES:

Shelton, William (Clapham)

Trafford, Dr. Anthony

Mr. Walter Clegg and

Trew, Peter

Mr. Bernard Weatherill.

Question accordingly negatived.

BUSINESS OF THE HOUSE
Ordered,
That the Consideration of Lords Amendments to the Fair Trading Bill may be proceeded with at this day's Sitting, though opposed, until any hour.—[Mr. Hawkins.]

FAIR TRADING BILL
Lords amendments considered.
FAIR TRADING BILL
  Clause 13

    MEANING OF "CONSUMER TRADE PRACTICE"
    Lords Amendment: No. 1, in page 11, line 33, at end insert:
    "( ) to methods of salesmanship employed in dealing with consumers, or".
    10.14 p.m.
    The Minister for Trade and Consumer Affairs (Sir Geoffrey Howe): I beg to move, That this House doth agree with the Lords in the said amendment.
    This Lords amendment— [Interruption.]
    Mr. Speaker: Order. May we have a little more silence, please?
    Sir G. Howe: This Lords amendment is to Clause 13 which, hon. Members will remember, was much debated in Standing Committee. At that stage we identified one area of omission, namely, packaging, as one which ought to be covered by way of amendment. We then looked at the scope of the clause as it stood to see whether anything else had been omitted. We came to the conclusion that there might be some doubt whether promotion as defined in paragraph (c), would cover patter by salesmen and other kinds of representation by salesmen. It is for that reason that we have extended the scope of the clause by this Lords amendment to ensure beyond doubt that oral and written representations connected with promotion and sales come within the definition of matters covered by the clause.
    Question put and agreed to. Vol.

  Clause 16

    RESTRICTION ON REFERENCES UNDER S. 14 IN RESPECT OF CERTAIN GOODS AND SERVICES.
    Lords Amendment: No. 21, in page 12, line 41, after "goods" insert "or services".
    Sir G. Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker (Mr. E. L. Mallalieu): With this, we will take Lords Amendment No. 59, in page 108, leave out lines 10 to 32 and insert:

    "Description of goods or services

    Form of supply

    (1) Apparatus or equipment used, or constructed or adapted for use, for the purposes of or in association with any such system as is mentioned in paragraph 7 of this Schedule.

    Supply to persons who are subscribers to a service provided by the Post Office which constitutes or forms part of any such system, in their capa—city as subscribers to such a service."

    (2) The installation or maintenance of any such apparatus or equipment.

    Sir G. Howe: The amendments relate to a technical variation of the scope of the definition of the monopoly of the Post Office in Schedule 5. Amendment No. 2 is a paving amendment in Clause 16 and Amendment No. 59 replaces the words referred in Schedule 5 so as to ensure that the scope of the Post Office monopoly as defined in the Post Office Act is covered identically and to the same extent in the provisions of Schedule 5.
    Mr. John Golding: Does this widen or narrow the original Schedule?
    Sir G. Howe: It widens it to make sure that it covers all means of telecommunication, not merely telephone services.
    Question put and agreed to.
    Lords Amendment: No. 3, in page 13, line 7, after "section" insert:
    ""Minister" includes a Minister of the Government of Northern Ireland, and".
    The Under-Secretary of State for Trade and Industry (Mr. Peter Emery): I beg to move, That the House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this we will take the following Lords amendments:
    No. 9, in page 37, line 3, after "Scotland "insert:
    "the Secretary of State for Wales, the Secretary of State for Northern Ireland".
    No. 10, in page 37, line, 4, after "Ireland "insert:
    "the Minister of Commerce for Northern Ireland".
    No. 11, in page 38, line 3, at end insert:
    "and the Minister of Commerce for Northern Ireland."
    No. 16, in page 63, line 42, at end insert:
    "and the Minister of Commerce for Northern Ireland".
    Mr. Emery: Clause 16 provides that before referring to the Advisory Committee the trade practices of certain nationalised industries carried on in connection with the supply of goods and services listed in Schedule 5 the Director General must first secure the consent of the Minister with sponsoring responsibility for that industry. The Minister responsible for certain nationalised industries in Northern Ireland has been omitted, and the amendments correct that omission and similar omissions in the other clauses referred to.
    Question put and agreed to.
    Lords Amendment: No. 4, in page 13, line 9, at end insert—
    "( ) The Secretary of State may by order made by statutory instrument vary any of the provisions of Schedule 5 to this Act, either by adding one or more further entries or by altering or deleting any entry for the time being contained in it; and any reference in this Act to that Schedule shall be construed as a reference to that Schedule as for the time being in force."
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    The amendment introduces a power by order to vary Schedule 5. Its terms are precisely parallel to those of the powers to vary the schedule already contained in Clause 50(5). In Committee my hon. Friend the Member for Kidderminster (Sir T. Brinton) drew the attention of the Committee to this. Clause 50(5) contains a power by order to vary the provisions of Schedule 7. There is,
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    however, no equivalent power in Clause 16 to vary the provisions of Schedule 5. The amendment remedies that omission
    Mr. Alan Williams: As such a power to vary is appropriate to the Schedule, I am surprised that it has not been thought necessary to insert a provision to exclude professional services.
    Will the order be subject to positive or negative procedure? The Opposition—and I suspect back-bench Members on both sides of the House—would prefer it to be subject to positive procedure.
    Mr. Emery: With the leave of the House, I congratulate the hon. Gentleman on his throw-away line about the professional services. That is an in joke which will be appreciated by hon. Members who served on the Committee. I confirm that the order will be subject to positive procedure.
    Mr. John Gorst: Can my hon. Friend say whether it will be possible to delete certain items as well as to increase them?
    Mr. Emery: With the leave of the House—
    Mr. Alan Williams: We are delighted to have the assurance that this is to be done by the positive procedure. However, in view of the frantic agitation now taking place in certain areas in close proximity to the Minister, I have a strong suspicion that this may not be the case. Perhaps the hon. Gentleman could now confirm that this will be subject to the positive procedure—and, if so, will he explain how this will be provided for in the Bill?
    Mr. Emery: With the leave of the House, may I reply to the hon. Member for Swansea, West (Mr. Alan Williams) and also to my hon. Friend the Member for Hendon, North (Mr. Gorst). They will realise that there are certain items which arc subject to the positive procedure and others to the negative procedure. I obviously misunderstood my own reply. [Laughter.] Well, I cannot be more honest than that. I appologise if I have misled the House. This particular amendment, which relates to the power to vary Schedule 5, is by negative resolution and is entirely parallel to

    629
    the variation of Schedule 7. If we were not to provide for the situation in this way, this would be inconsistent with what is already in the Bill.
    Mr. Williams: With the leave of the House, may I say that I regard consistency as less important than securing the rights of the House. Frankly, I regret the fact that I gave the Minister the opportunity to reconsider his original reply. I must state that the Opposition are utterly dissatisfied with the situation. The Minister is taking power to make an important variation. We feel that this should be done by the positive procedure since this would give the House closer scrutiny over these matters. It may be that at a later stage, in the event of a change of Government, it will be appropriate to extend Schedule 5. In the event of that being necessary, I feel that certain Conservative back-bench Members may in some future Parliament regret that this is to be by a negative rather than by a positive procedure.
    Mr. Emery: I understand the point. There appears to be an argument that in regard to Schedules 5 and 7 one may be said to be more important than the other. As an intellectual argument I find that somewhat difficult to sustain. As I said earlier, it was thought right that this provision should be on exactly the same lines as similar provisions.
    Mrs. Sally Oppenheim: Would my hon. Friend not agree that in the unlikely event of Labour returning to power, it is understandable that the hon. Member for Swansea, West (Mr. Alan Williams) should be worried about further variation, because it would mean that he would be responsible for adding 25 nationalised companies?
    Mr. Deputy Speaker: I must remind the House that this is not a Committee stage and that observations should be made before the Minister resumes his place.
    Question put and agreed to.

  Clause 19

    SCOPE OF RECOMMENDATION PROPOSED IN REFERENCE TO WHICH S. 17 APPLIES
    Lords Amendment: No. 5, in page 14, line 14, leave out "or classes".
    Sir Geoffrey Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    This and the other Lords amendments to Clause 19 and one linked amendment to Schedule 6 all have the effect of removing some doubt which existed about the scope of the powers conferred by Clause 19(2) on the Director to make orders in relation to certain classes of transactions. The wording which existed there, notably in lines 27 and 28, might have restricted the Director's power to make recommendations for certain kinds of order. By these changes we remove any doubt and clarify and strengthen the power conferred upon the Director General.
    Question put and agreed to.
    Subsequent Lords Amendments agreed to

  Clause 69

    DIFFERENT KINDS OF MERGER REFERENCES
    Lords Amendment: No. 12, in page 51, line 4, at end insert:
    "(2A) In relation to the question whether any such result as is mentioned in section 64(1)(a) of this Act has arisen, a merger reference may be so framed as to require the Commission to confine their investigation to the supply of goods or services in a specified part of the United Kingdom."
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    This amendment and those to Clause 75 are concerned with the framing of merger references. Lords Amendment No. 12 restores to the merger provision of the Bill the effect of the last four lines of Section 6(4) of the Monopolies and Mergers Act 1965 which says that "the reference may be so framed as to require the Commission to confine their investigation to the supply of goods or services in a specified part of the United Kingdom". It provides that in cases where a reference is so made it must specify which part of the United Kingdom is relevant.
    Question put and agreed to.
    Subsequent Lords amendments agreed to.

  Clause 88

    ACTION BY DIRECTOR IN CONSEQUENCE OF REPORT OF COMMISSION ON MONOPOLY OR MERGER REFERENCE.
    Lords Amendment: No. 17, in page 64, line 32, after "73(1)" insert:
    "or in section 75(4)(e)".
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    It repairs an omission in the Bill to which attention was drawn in Committee. The existing definition in Clause 88(6)(b) of the "relevant parties" with whom the Director will be required to negotiate undertakings following an adverse report of the Commission on a merger reference refers only to persons in control of enterprises which have ceased to be distinct. This amendment deals with the more normal situation where a reference has been made in anticipation of a merger and it enables the Director to negotiate undertakings with persons who may be proposing to take over an enterprise in the merger situation.
    Question put and agreed to.
    Subsequent Lords amendments agreed to.

  New Clause A

    TRADE ASSOCIATION NOT TO INCLUDE CERTAIN APPROVED SOCIETIES
    Lords Amendment: No. 23, after Clause 96, in page 70, line 41, at end insert new Clause A?—
    "A. In section 6(8) of the Act of 1956 which contains a definition of 'trade association'), after the words 'or of persons represented by its members' there shall be inserted the words 'and which is not a society for the time being approved under section 6A of this Act'."
    Sir G. Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this amendment it will be convenient to take Lords Amendment No. 24, in page 70, line 41, at end insert new Clause B-Wholesale co-operative societies.
    Sir G. Howe: May I suggest that we also take the following Lords amendments:
    No. 38, in Clause 108, page 79, line 38. leave out "the following provisions"and insert "subsections (2) to (5)".
    No. 39, in page 80, line 6, at end insert
    "and
    (c) it is not a society which is for the time being approved under section 6A of the Act of 1956".
    No. 40, in page 81, line 6, at en insert—
    "( ) In relation to a society which is for the time being approved under section 6A of the Act of 1956, but which, in consequence of an order made under section 103 or section 104 of this Act, is a society to which the preceding provisions of this section would apply if it were not so approved, subsection (4) of that section (which confers power on the Secretary of State to withdrawn any such approval) shall have effect as if in that sub-section?—

    (a) any reference to an agreement which would have been subject to registration under Part I of the Act of 1956 if the approval had not been given included a reference to an agreement which would in those circumstances have been subject to such registration by virtue of the order, and

    (b) any reference to such a recommendation as is mentioned in section 6(7) of that Act included a reference to such a recommendation as is mentioned in subsection (3) or subsection (4) of this section."

    No. 68, in Schedule 11, page 120, line 22, at end insert?—
    "Restrictive Trade Practices Act 1968, s. 11 An agreement which?—

    (a) was made before the commencement of this Act by a society at a time when it was approved for the purposes of section II of the Act of 1968 (wholesale co-operative societies), and

    (b) by virtue of that approval was not subject to registration under Part I of the Act of 1956,

    shall, notwithstanding the repeal of that section, not be subject to such registration.".
    No. 69, in Schedule 12, page 121, line 13, column 2, at beginning insert:
    "In section 6, in subsection (I), for the words "the two next following sections" there shall be substituted the words "sections 7 and 8 of this Act"
    In section 22, after subsection (4) there shall be inserted the following subsection:—
    "(5) The foregoing provisions of this section shall not apply in relation to any order made under section 21A of this Act.".
    No. 70, in page 122, line 36, column 2, leave out "paragraph" and insert "paragraphs".
    No. 72, in page 122, line 44, column 2, at end insert:
    "(I) in the case of an agreement which becomes subject to registration by virtue of the expiration or withdrawal of an approval given under section 6A of the Act of 1956, within three months from the day on which the agreement becomes so subject."
    No. 73, in Schedule 13, page 124, line 30, at end insert:

    "1968 c. 66.

    The Restrictive Trade Practices Act 1968.

    Section 11."

    These amendments deal with the position of wholesale co-operative societies which were the subject of a debate on an Opposition amendment in Committee. It was also the subject of a meeting between myself and a number of hon. Members who made representations about the position of such societies and the extent to which they ought to be eligible for the relief made available by Section 11 of the 1968 Act.
    The problem arises because the wholesale co-operative society is deemed to be a trade association by virtue of the provisions of Section 6(8) of the 1965 Act. It follows that the recommendations it makes to its retail society members are registrable and subject to judicial examination. The wholesale co-operative society regards itself as more analogous to a group of companies with multiple retail outlets. I need not pursue the complexities of the relationships beyond that.
    On analysis of the problem it is clear that some provision should be made for making available to wholesale co-operative societies relief of the kind in question. These amendments enable that to happen. They will enable the Secretary of State to approve industrial and provident societies that meet certain criteria so that they will no longer be deemed to be trade associations for the purposes of the restrictive trade practices legislation.
    The criteria are threefold: first, that the society carries on business in the production and supply of goods or in the supply of services or in the application to goods of any process of manufacture; secondly, that its shares are mainly or wholly held by industrial and provident societies; and, thirdly, that those societies are retail societies or societies whose shares are wholly or mainly held by retail societies.
    Having decided that relief should be given in that way, it was important to ensure that the freedom conferred was not likely to be abused. For that reason, a time limit of two years on any approval with provision to extend has been imposed. There is also power for the Secretary of State to withdraw the approval if it appears to him that the society was acting in a way which was likely to have a seriously adverse effect on competition.
    I think that these amendments meet the representations that were made by hon. Members on a point which has caused concern for a number of years. I commend them to the House on that basis.
    Dr. J. Dickson Mabon: On behalf of my 14 colleagues of the parliamentary Co-operative Group I should like to say how much we appreciate the way that the Minister has handled this matter. It was debated in Committee and was raised in the other place. I should also like to thank the Minister in the Lords, Lord Limerick, and Lords Diamond, Hoy, Jacques and Baroness Phillips for what they have done in this regard.
    Often the Co-operative Group is forgotten, but it is to the credit of the Government that they have made these amendments. This is a complex matter, as the right hon. and learned Gentleman said and knows from the submission that we made to him, but it has been dealt with adequately and fairly not only from the co-operative sectional interest, but the wider interest of the nation.
    On behalf of Co-operative Members both here and in another place, I should like to thank the Minister for these amendments.
    Mr. Bruce Millan: I should like to add my thanks to the Minister. This matter was debated in Committee. It seems that the amendments that the Government put down in the other place meet the legitimate concern of the co-operative movement about the present legal situation and yet at the same time safeguard the public interest, because, if for any reason there was a feeling that the new provisions were leading to adverse results from the competitive point of view, he could step in and withdraw the approval. A nice balance

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    has been drawn here, and the Government deserve to be thanked for what they have done in this difficult area.
    Question put and agreed to.
    Subsequent Lords Amendments agreed to.

  New Clause C

    AGREEMENTS RELATING TO COAL OR STEEL
    Lords Amendment: No. 25, in page 70, line 41, at end insert new Clause C—
    "C. In section 7 of the Act of 1956, before subsection (2) there shall be inserted the following subsections:—
    "(1A) In determining whether an agreement is an agreement to which this Part of this Act applies, where—

    (a) the parties to the agreement are or include two or more bodies to which this subsection applies, and

    (b) restrictions relating to coal or steel, or relating to both coal and steel, are accepted under the agreement by two or more such bodies, whether the restrictions so accepted by those bodies are the same restrictions or different restrictions,

    no account shall be taken of any such restriction which is accepted under the agreement by a body to which this subsection applies, whether that restriction is also accepted by any other party to the agreement or not.
    (1B) Subsection (IA) of this section applies to any body which, in accordance with Article 80 of the E.C.S.C. Treaty, constitutes an undertaking for the purposes of Articles 65 and 66 of that Treaty, and in that subsection "coal" and "steel" have the meanings assigned to them respectively Annex I to that Treaty.""
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    This amendment has been introduced to meet representations made by the BSC and BISPA that the restrictive trade practices legislation could place them under greater restraint than their European counterparts and would thence put them at a disadvantage. The amendment would remove from the scope of the restrictive practices legislation agreements to which two or more coal, iron or steel undertakings are party and in which restrictions relating to steel products as defined in the Treaty of Paris are accepted by two or more such undertakings. The amendment seeks to ensure that the BSC and BISPA will be on
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    equal terms with those in Europe. It seems sensible to meet the requests of both the BSC and BISPA.
    Question put and agreed to.

  Clause 98

    PATENT OR DESIGN POOLING AGREEMENTS
    Lords Amendment: No. 26, in page 71, line 16, after "include" insert "at least three".
    Sir G. Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    The amendment relates to a point raised in Committee by my hon. Friend the Member for Bedford (Mr. Skeet), who is not here today. It was suggested that the provisions of the clause as it stood would cover a large number of patent pooling agreements which ought not to be made registrable. The amendment is in response to representations that we received following the discussions in Committee and has the effect of making it a pre-requisite of registrability that a patent or design pooling arrangement must have at least three principal parties. It alters the scope of the clause so that it no longer catches bilateral agreements that were not intended to be caught by the substance of the legislation.
    I hope that on the basis that the amendment represents a sensible response to the needs of industry, it will commend itself to the House.
    Question put and agreed to.
    Lords Amendment: No. 27, in page 7, line 23, leave out "each such patent" and insert
    "one or more such patents"
    Sir G. Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    I hope to move on some other occasion, That this House doth change that form of words.
    Mr. Deputy Speaker: With this we are to take the following Lords amendments:
    No. 28, in page 71, line 24, leave out "design to each" and insert:
    "designs to one or more".
    No. 29, in page 71, line 25, leave out "each" and insert "one or more"
    No. 30, in page 71, line 26, leave out "each" and insert "at least one".
    No. 31, in page 71, line 28, leave out "each" and insert "one or more".
    No. 32, in page 71, line 29, leave out "each" and insert "one or more".
    Sir G. Howe: These amendments are of a comparable kind, although moving in the opposite direction, because they have the effect of altering the scope of this provision and closing a loophole to which the Opposition drew attention in Committee.
    If the word "each" in the provision as now drafted were interpreted as "every", it would mean that a patent pooling agreement would be registrable only if an interest in all the patents in a pool were granted to all the principal parties. That was not the Government's intention. The amendment seeks to ensure that an agreement is registrable if an interest in any patent in the pool is granted to any of the principal parties. This is being done in response to the shrewd observations of the hon. Member for Glasgow, Craigton (Mr. Millan).
    Question put and agreed to.
    Subsequent Lords amendments agreed to.

  Clause 100

    EXAMINATION ON OATH OF CERTAIN EMPLOYEES OF BODIES CORPORATE AND UNINCORPORATED TRADE ASSOCIATIONS.
    Lords Amendment: No. 33, in page 73, line 5, leave out "subsection" and insert "subsections".
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    If my right hon. and learned Friend gets the opportunity to move the motion that he suggested on the previous amendment it will give me great pleasure to support it.
    Mr. Deputy Speaker: With this we are to take Lords Amendment No. 34, in page 73, line 9, at end insert:
    "(3B) Nothing in this section shall be taken to compel the disclosure by a barrister, advocate or solicitor of any privileged communication made by or to him in that capacity, or
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    the production by him of any document containing any such communication."
    Mr. Emery: The amendment meets the point touched on by my hon. Friend the Member for Bedford (Mr. Skeet)—who is unfortunately detained elsewhere—in Committee and again by Lord Stow Hill in another place.
    The clause extends the provisions of Section 15(3) of the Restrictive Trade Practices Act 1956, as amended, to examination on oath by the Restrictive Practices Court. The court is in future to be free to examine any employee of a company.
    Amendment No. 34 makes it clear that it would not be within the court's power to require employees who are barristers, advocates or solicitors to disclose information which, in accordance with the law of evidence, could be protected by professional privilege from being disclosed in civil proceedings.
    I assure the House that this has nothing to do with the professional aspects of my right hon. and learned Friend. I think that it happens to be right, and I am sure that the House will agree with the amendment.
    Question put and agreed to.

  CLAUSE 102

    INTERIM ORDERS OF RESTRICTIVE PRACTICES COURT
    Lords Amendment: No. 35, in page 75, line 3, at end insert:
    "( ) At any time when any such interim order is in force, the Court, on the application of the Director or of any person who is subject to or entitled to the benefit of any restriction specified in the order, may discharge the order and substitute for it any interim order which could have been made on the original application under this section."
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this it will be convenient to discuss Lords Amendment No. 36, in page 75, line 9, at end insert:
    "( ) the discharge of the order by the Court."
    Mr. Emery: These amendments seek to remove any doubt that the Restrictive

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    Practices Court will have power to discharge or vary its own interim orders. The effect will be that it will have power to do so on the application of the Director or—and this is the important part—of any interested party.
    May I again pay tribute to the hon. Member for Glasgow, Craigton (Mr. Millan), who moved a similar amendment in Committee. I then gave an undertaking that we would look at the point that had been made, which seemed to be substantial. I said that we could not accept the exact wording of that amendment but that if we felt that it was of substance we would move amendments in another place. These amendments fulfil that undertaking.
    Question put and agreed to.
    Subsequent Lords amendment agreed to.

  New Clause D

    INDUSTRIAL AND PROVIDENT SOCIETIES AND THEIR SUBSIDIARIES
    Lords Amendment: No. 37, after Clause 102, in page 75, line 15, at end insert new Clause D—
    "D. In section 36(1) of the Act of 1956, in the definition of "inter-connected bodies corporate", after the words "all other bodies corporate which are its subsidiaries within the meaning of section one hundred and fifty-four of the Companies Act 1948" there shall be inserted the words "or (in the case of an industrial and provident society) within the meaning of section 15 of the Friendly and Industrial and Provident Societies Act 1968"."
    Sir G. Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    This is another amendment relating to the position of industrial and provident societies in the co-operative field. Its effect is to extend the concept of a group, as embodied in the magic phrase "interconnected bodies corporate" for an industrial and provident society and its subsidiaries.
    This is a logical step to take. It is in response to an amendment moved in Committee.
    Mr. John Roper: I support what my hon. Friend the Member for Greenock (Dr. Dickson Mabon) said
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    earlier. The co-operative movement very much welcomes this technical amendment, along with the amendments made in Committee. In the submissions made to the Department we pointed out that this was an important correction which should be made. We are glad that it has been possible to do this in another place.
    Question put and agreed to.
    Subsequent Lords amendments agreed to.

  Clause 112

    APPLICATION OF PROVISIONS OF ACTS OF 1956 AND 1968
    Lords Amendment: No. 41, in page 86, line 43, at end insert—
    "(4A) In section 9 of the Act of 1968 any references to particulars entered or filed in the register pursuant to Part I of the Act of 1956 shall be construed as including a reference to particulars so entered or filed pursuant to any provisions of Part I of the Act of 1956 as applied by subsection (1) of this section."
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    This amendment corrects an omission. Clause 112 deals with the application of the provisions of the Restrictive Trade Practices Acts, 1956 and 1968, to the service agreements which will in future be brought within the scope of the legislation under Part X of the Bill.
    It was suggested at an earlier stage by the hon. Member for Glasgow, Craig-ton (Mr. Millan) that the clause could be considered to be defective in that it did not go far enough in applying the provisions of the earlier legislation. In particular, it was suggested by the hon. Member that it would not enable the useful procedures in Section 9 of the Restrictive Trade Practices Act 1968 to be used for agreements registered under these new provisions.
    We are not absolutely certain that the hon. Member is completely right, but in order to ensure that nothing should go wrong we felt that it would be desirable to make this amendment to cover completely the points that he had made.
    Mr. Millan: I thank the Minister for moving the amendment. I would thank

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    him even more warmly if I could remember having raised this point in Committee. Obviously, I did raise it, and clearly it was an even better point than I thought at the time. I am glad that the matter has been put right.
    Question put and agreed to.

  New Clause E
    TRADING SCHEMES TO WHICH PART XI APPLIES
    Lords Amendment: No. 42, after Clause 113, in page 87, line 43, at end insert new Clause E—
  PART XI

    PYRAMID SELLING AND SIMILAR TRADING SCHEMES
    E.—(I) This Part of this Act applies to any trading scheme which includes the following elements, that is to say—

    (a) goods or services, or both, are to be provided by the person promoting the scheme (in this Part of this Act referred to as "the promoter") or, in the case of a scheme promoted by two or more persons acting in concert (in this Part of this Act referred to as "the promoters"), are to be provided by one or more of those persons;

    (b) the goods or services so provided are to be supplied to or for other persons under transactions effected by persons (other than the promoter or any of the promoters) who participate in the scheme (each of whom is in this Part of this Act referred to as a "participant");

    (c) those transactions, or most of them, are to be effected elsewhere than at premises at which the promoter or any of the promoters or the participant effecting the transaction carries on business, and

    (d) the prospect is held out to participants of receiving payments or other benefits in respect of any one or more of the matters specified in the next following subsection.

    (2) The matters referred to in paragraph (d) of subsection (1) of this section are—

    (a) the introduction of other persons who become participants;

    (b) the promotion, transfer or other change of status of participants within the trading scheme;

    (c) the supply of goods to other participants;

    (d) the supply of training facilities or other services for other participants;

    (e) transactions effected by other participants under which goods are to be supplied to, or services are to be supplied for, other persons.

    (3) For the purposes of this Part of this Act a trading scheme shall be taken to include the element referred to in paragraph (b) of subsection (1) of this section whether
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    the transactions referred to in that paragraph are to be effected by participants in the capacity of servants or agents of the promoter or of one of the promoters or in any other capacity.
    (4) In determining, for the purposes of paragraph (c) of subsection (1) of this section, whether any premises are premises at which a participant in a trading scheme carries on business, no account shall be taken of transactions effected or to be effected by him under that trading scheme.
    (5) For the purposes of this Part of this Act such a prospect as is mentioned in paragraph (d) of subsection (1) of this section shall be taken to be held out to a participant

    (a) whether it is held out so as to confer on him a legally enforceable right or not, and

    (b) in so far as it relates to the introduction of new participants, whether it is limited to the introduction of new participants by him or extends to the introduction of new participants by other persons.

    (6) In this Part of this Act "trading scheme" includes any arrangements made in connection with the carrying on of a business, whether those arrangements are made or recorded wholly or partly in writing or not.
    (7) In this section any reference to the provision of goods or services by a person shall he construed as including a reference to the provision of goods or services under arrangements to which that person is a party."
    Sir G. Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this it will be convenient to discuss the following Lords Amendments:
    No. 43, in page 87, line 43, at end insert new Clause F—Regulations relating to such trading schemes.
    No. 44, in page 87, line 43, at end insert new Clause G—Offences under Part XI.
    No. 45, in page 87, line 43, at end insert new Clause H—Defences in certain proceedings under Part XI.
    No. 46, in page 87, line 43, at end insert new Clause I—Penalties for offences under Part XI.
    No. 47, in page 87, line 43, at end insert new Clause J—Enforcement provisions.
    No. 49, in page 93, line 9, leave out "or".
    No. 50, in page 93, line 10, after "85(6)" insert "or Part XI".
    No. 51, in page 94, line 21, after "order" insert:
    "or whereby any regulations are made under this Act".
    No. 54, in page 98, line 4, leave out "for" and insert:
    "any reference in those provisions to services supplied or to be supplied, or to services provided or to be provided, shall be construed accordingly.
    ( ) For".
    No. 74, in line 17, in the Title, after "Agreements" insert:
    "to make provision with respect to pyramid selling and similar trading schemes".
    Sir G. Howe: This is certainly the most important group of amendments that we are considering this evening. It deals with the problems that arise from pyramid selling and similar trading schemes. It is the group which results in adding to the Bill, as it left this House, Part XI, a totally new Part, to deal with this problem.
    As the House well knows, it has been the Government's intention to get rid of the menace of pyramid selling as soon as it was possible to enact legislation. [HON. MEMBERS: "Hear, hear."] As is clear from the chorus of voices now raised, that has been for some time the general wish of the House.
    10.45 p.m.
    The House will recall that in March we published a consultative document setting out the measures which then seemed to us to be needed to impose a ban on the objectionable features of pyramid selling. At that stage we were proposing to impose a ban on the soliciting for or taking of payments in respect of rights in a pyramid selling scheme. As a result of that we received a number of comments from hon. Members and from commentators outside the House. It was suggested to us that the simple concept "taking of payment" could be disguised in a number of ways, for example through the sale to new recruits of excessive quantities of goods by the recruiter or by providing spurious training for recruits at exorbitant prices from which recruits would gain little or no benefit.
    It became clear after the publication of the consultative document that the narrow definition of pyramid selling could
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    be easily evaded and that, if that were to happen, many undesirable practices would not be caught. Accordingly, we decided that the only effective approach to the problem was to define widely those schemes which might be used as a basis for pyramid selling and to take flexible powers to control both their control and their operation. It is that which we have done.
    We have defined trading schemes which are to be subject to these measures in relation to direct selling. The definition is further designed to ensure that, however disguised rewards for recruitment may be, schemes that offer such rewards and are open to abuse in that kind of way are brought within it. This is the essential object of Lords Amendment No. 42. Effectively, it covers schemes in which goods or services are provided by promoters otherwise than from business premises and in which the participants are offered the prospect of reward whether in cash, commission, profit on goods or services sold for recruiting efforts or as a result of the activities of others.
    Lords Amendment No. 54 is a consequential amendment to extend the definition of "services" in Clause 127.
    One unavoidable feature of defining the matter as widely as that is to bring within the scope of this part of the Bill some unobjectionable schemes. The fact that a trading scheme falls within the definition does not necessarily imply that it is objectionable. Schemes are objectionable if they are of a kind in which the offence proposed in new Clause G is committed. It is no part of the Government's intention to impede or restrict the development or operation of unobjectionable schemes such as those which subscribe to the code of conduct of the Direct Sales and Service Association or mail order trading schemes.
    We have seen how quickly pyramid selling schemes can be shifted or bent to evade any proposed stipulation in the law. It is for that reason that Lords Amendment No. 43 provides the Secretary of State with wide and flexible powers to regulate by statutory instrument the promotion and conduct of schemes coming within the definition. Powers drawn in that form will ensure that any new and as yet unforeseen and

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    perhaps undreamt of objectionable practice which can be adopted in this context can he stopped much more quickly than if the basic statutory law had to be amended. Amendment No. 51 provides for the negative procedure in relation to these orders.
    I need not weary the House by going in detail through the matters which may be regulated, but they are set out in Amendment No. 43. The regulation-making powers can be used with discretion so as to ensure that the regulation catches only objectionable schemes. Equally, it enables us to amend the regulations if it transpires that inadvertently we are catching unobjectionable schemes.
    The regulations may be a vital part of the measures here contained. We will ensure in the drafting that they are comprehensive. There is no difficulty about laying them during the recess.
    Amendment No. 44 deals with the offences which may be committed under the new Part XI. Amendments Nos. 49 and 50 ensure that if the offences are committed by a body corporate the officers of that body may also be prosecuted. The provisions there will put an end to the evasion which has been frequently practised in the past, namely where certain activities have been carried on by over-zealous participants without the authority of the company or its promoters.
    Amendment No. 46 provides for penalties at the usual level for such offences, if it is possible to speak in such terms about these matters. Amendment No. 47 deals with enforcement. It is essential that this part of the Bill should be enforced quickly and vigorously. That can best be done by the Department, because the organisation which will take on the job is already in existence. Staff of the Department are experienced in investigating these complicated matters and in bringing prosecutions over the whole area of company law. It seems right, therefore, to apply these resources to this purpose for what I hope will be the limited period which it will take to get rid of this objectionable practice of pyramid selling. The provisions here set out make available to the Department for the purposes of investigating pyramid selling schemes a suitably adapted form of the powers otherwise available in the
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    rest of the Bill to weights and measures authorities. There is also a need to amend the Long Title of the Bill.
    Pyramid selling has proved to be a difficult problem to deal with legislatively. These comprehensive measures are to be taken as a whole and will make it extremely difficult for any scheme remotely resembling pyramid selling in its present form to be set up or to continue without the promoters committing a criminal offence. I commend this part of the Bill to the House on that basis, as a determined effort to provide powers which will stamp out these objectionable, not to say fraudulent, methods of trading which have caused so much hardship. I hope when these measures are on the statute book they will have that effect and I hope that even beyond the territory covered by these provisions people who might be tempted by comparable things that appear on the market will remain as vigilant as they should be when confronted by this kind of fraudulent temptation.
    Mr. Raphael Tuck: The right hon. and learned Gentleman hath written me a letter dated 12th June 1973 which contained the following sentence:
    "I hope that when you see the proposed measures, you will agree that they provide adequate powers."
    I congratulate the Government on the efforts they hath made to stamp out this abominable practice, but I regret that I cannot agree that the powers are adequate.
    My hon. Friend the Member for Ebbw Vale (Mr. Foot) described the right hon. and learned Gentleman, when he was Solicitor-General, as being capable of wriggling out of anything. I suggest to the right hon. and learned Gentleman that these companies, too, can wriggle out of anything, and will try to do so. Holiday Magic has been boasting openly that the Government's measures will make no difference to it and that it will continue with its filthy practice—"filthy" is my word, not the company's. It has announced a New General Programme with effect from 27th June 1973, which tries to squeeze £1,020 out of unsuspecting clients.
    The definition in the Bill contained in new Clause E tries to catch everyone, but the definition of a trading scheme has

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    been commented on by the Public Interest Research Centre in a memorandum dated 18th June. I hope that the right hon. and learned Gentleman is familiar with it. It says:
    "The definition of trading scheme now suggested by the Government is both long and complex".
    However, it agrees that some degree of complexity is inevitable if the definition is to be watertight in law. I wish that the parliamentary draftsman had drafted all these amendments to Bill in a simple manner which could be understood by the average layman. I am a lawyer, of sorts, and even with a wet towel over my head I was unable to understand quite a number of clauses. Perhaps the right hon. and learned Gentleman will explain them to me some other time.
    The Public Interest Research Centre goes on:
    "Even as at present drafted there are serious potential loopholes."
    I shall not speak about those loopholes because I am sure that the right hon. and learned Gentleman has them under advisement. One point to which I would draw attention is part of the definition clause—new Clause E(1)(c):
    "those transactions, or most of them, are to he effected elsewhere than at premises at which the promoter or any of the promoters or the participant effecting the transaction carries on business".
    Surely this could be got round by the promoters or the participants effecting pyramid transactions on their own premises.
    New Clause F(2)(e) provides that regulations made by the Secretary of State by statutory instrument may prohibit the promoter of a trading scheme or the participants from
    "accepting from any such participation any payment, or any undertaking to make a payment, in respect of any goods or services supplied".
    Why limit it to goods or services supplied? Suppose payment were made for so-called "training", for joining or for raising the person concerned to a higher level. None of these matters is covered, but they should be covered.
    New Clause F(3) says:
    "Any requirements prescribed by regulations under subsection (2) of this section shall be such as the Secretary of State considers
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    necessary or expedient for the purpose of preventing participants in trading schemes to which this Part of this Act applies from being unfairly treated; and, without prejudice to the generality of this subsection, any such requirements may include provisions—
    (a) requiring the rights and obligations of every participant under such a trading scheme to be set out in full in an agreement in writing …"—
    I agree with that and also with the next subsection,
    "(b) specifying rights required to be conferred on every such participant".
    However, nothing is mentioned about requiring a specified territory to be assigned to a participant. The participants may find that there are a hundred or two hundred in their territory, and that they have no chance of selling the goods. There should therefore be a clause requiring a specific territory to be assigned to a particular participant.
    Again, many participants, when they seek to sell their goods, make extravagant claims which are later found to be absolutely groundless. When the poor people who have bought the goods try to get back at the participant by going to the company, the company says, "We are in no way connected with this participant. He is not an agent of the company. He is merely an independent contractor."
    No provision is made against that sort of practice. Quite a lot was said, however, in simple terms in my Bill, which the Government have blocked every Friday it has come up. It is still before the House. It says in Clause 2:
    "(2) Every agreement entered into between a company carrying on business in multi-level marketing and an agent for any such company for the sale of goods or services shall—

    (a) be in writing;

    (b) designate the agent as agent of the company and not as an independent contractor; …

    (d) grant to the agent exclusive territorial rights in an area clearly defined in the agreement."

    Why is not such a provision incorporated in this Bill?
    New Clause F(4) says:
    Regulations made under subsection (2) of this section—
    (a) may include provision for enabling a person who has made a payment as a participant in a trading scheme to which this Part of this Act applies, in circumstances where any of the requirements prescribed by the regulations were not complied with,

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    to recover the whole or part of that payment from any person to whom or for whose benefit it was paid".
    That is a very good provision, but the right hon. and learned Gentleman will be inundated with claims under this clause. Why not legislate directly so that he will not be inundated by these claims?
    If the right hon. and learned Gentle. man comes to my office he will see that I have a pile of claims about two inches thick. Those are claims which have been made by people who want their money back. If the right hon. and learned Gentleman multiplies that by 630—the number of Members of Parliament—he will see how he will be avalanched by claims. Why not legislate directly instead of making the matter subject to regulation by the Secretary of State or by the Minister?
    11.0 p.m.
    I agree that room must be left for regulations. The companies concerned will have a knack of getting round or under the Bill and, therefore, a safety valve must be provided. However, I suggest that there should be direct legislation on all matters on which it is possible so to legislate at this particular moment.
    New Clause G(3) says:
    "If any person who is a participant in a trading scheme to which this Part of this Act applies, or has applied or been invited to become a participant in such a trading scheme—
    (a) makes any payment to or for the benefit of the promoter or (if there is more than one) any of the promoters, or to or for the benefit of a participant in the trading scheme … any person to whom or for whose benefit that payment is made shall be guilty of an offence."
    The participant for whose benefit the payment is made may know absolutely nothing about it but he will still be guilty of an offence by virtue of this provision.
    I realise that new Clause H(2)(b) says that
    "it shall be a defence for him to prove—that the act constituting the offence was committed without his consent or connivance".
    However, that applies only to promoters and not to participants. Again, there is a lacuna here. I suggest that that be amended. I remind the House that new Clause G(3)(b) says:
    "and is induced to make that payment by reason that the prospect is held out to him
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    of receiving payments or other benefits in respect of the introduction of other persons who become participants in the trading scheme, any person to whom or for whose benefit that payment is made shall be guilty of an offence".
    The new clause relates only to inducement. But what if the payment to the promoter is made without that inducement? Supposing the payment is made for goods? Supposing the payment is made for training? Supposing the pay. ment is made for becoming a distributor? There is nothing to prevent such payments. I do not like to blow my own trumpet but I must refer to my Bill, which provides for such a situation. Clause 2(3) says:
    "No company carrying on business of multilevel marketing shall require any person to purchase goods or services…."
    That is simple and direct. Companies—or promoters—cannot require anybody to purchase goods or services. If the goods are good enough they will be able to be sold on commission—for example, Kleeneze, whose brochure I have. If they are good enough they can be sold on commission and they need not be sold direct to the participant concerned. He need not be lumbered with £850 or £1,000 worth of the goods which he is to sell. He can merely sell the goods on cornsion. Kleeneze provide for a maximum payment of £5 for a kit. My Bill at Clause 2(3) says:
    "No company carrying on business in multi-level marketing shall require any person to purchase goods or services, or to pay or give any consideration other than a maximum payment of i10 in consideration of becoming an agent of the company".
    That is simple and direct. The commission may be paid—such commission as is deemed to be fair. Clause 4 says:
    "… but no such company shall pay or given any consideration to any of its agents for recruiting any other person as agent of such company".
    That would be much simpler and would catch anybody who gave any consideration to an agent for recruiting another person as agent of or participant in the company.
    Therefore, the maximum payment would be £10. An agent or participant would not and could not be required to pay for the goods or for training or for becoming a distributor. I commend again that part of my Bill to the Minister. It is not complex. It is quite simple

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    and would prevent any such practices as have been prevalent among pyramid selling companies.
    Lords Amendment No. 46, laying down penalties, says that a guilty person shall be liable,
    "on summary conviction, to a fine not exceeding £400 …".
    When people are making thousands and millions of pounds out of this kind of thing, what penalty is it to be deprived of £400. It is derisory. I suggest a very big fine indeed for the first conviction and a larger fine and/or imprisonment for the second. I ask the Minister to consider that £400 means nothing to these people. It means no more than a fine of £2 meant some time ago to wealthy people driving Rolls-Royce cars. I repeat finally that I think that the Minister will run into trouble and will find that loopholes will be found in the Bill by which its spirit can be successfully evaded.
    Mr. Alan Williams: I welcome the inclusion of these amendments. In Committee we sought to have pyramid selling covered by the Bill but the Government were doubtful whether it would be possible. We welcome the fact that they have been able to use the Bill after all instead of waiting for separate legislation, which would probably have meant waiting for another year.
    Equally; I recognise the Minister's approach in saying that the legislation must be flexible. That is obviously the case. We are dealing here with some companies which are honourable and honest, but many are fraudulent, dishonest and unscrupulous. They will employ the best and equally unscrupulous legal advice to find ways round the Bill.
    The Government will probably recognise, as we and all the consumer groups recognise, that legislation for the control of pyramid selling can be only as effective as the determination with which it is applied and enforced. For that reason, I have a number of questions to put, since this is the first time we in this House have had the chance to consider the proposals relating to pyramid selling.
    How is the legislation to be enforced? What is the precise role of the Director General of Fair Trading in the process
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    of enforcement? Who will be responsible for collecting information? Is there a duty actively to collect information? In questions of health and safety, the Director General has a passive role—he can receive information but not actively search for abuse or information or initiate investigations and research. Is there any duty on anyone actively to seek out abuses as envisaged by the amendments? What duty is imposed and what machinery will exist to ensure that the information collected at local level by weights and measures inspectors is transferred through the consumer protection machinery to the centre?
    I agree with the approach taken in the other place that enforcement is better treated in relation to pyramid selling as a national rather than as a local duty. That is correct. Nevertheless, the initial information may emerge at local level and we want to be sure that there is adequate machinery and that the duty is imposed at local level to guarantee that, as soon as such information is available, it is immediately transferred to the centre where the sanctions can be brought into operation.
    When will this part of the legislation come into force? The right hon. and learned Gentleman said that it would be as soon as possible. Since the amendments have been in existence for a few weeks, it is not unreasonable to assume that draft regulations have been prepared. The Minister legitimately made the point that there is nothing to prevent these regulations being laid during the recess, but that does not alter the fact that it will still be two or three months before Parliament has the opportunity to interrograte the Minister in the nicest and most helpful way on the efficiency of the regulations he decides to introduce.
    Can the Minister spell out how far Amendment 45 referring to schemes already in operation, will limit the effectiveness of the amendment? I note that Amendment No. 45—new Clause 4(2)—says:
    "…it shall be a defence for him to prove … that the trading scheme to which the charge relates was in operation before the commencement of this Act".
    How far does that mean that existing abuses can carry on? I am sure that it is not the Minister's intention that abuse

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    shall be permitted to exist where it existed before the legislation came into operation, but is the Minister sure that he can break abuses already in operation?
    When we came to the question of penalty, my hon. Friend the Member for Watford (Mr. Raphael Tuck) made an important point when he said that the level of fine envisaged is small and derisory in relation to the sort of profit which these operators are making.
    What will constitute an offence? Is the offence just to set up such an operation or venture? If so, £400, as my hon. Friend the Member for Watford said, in relation to turning oneself into a millionaire, will seem a worthwhile gamble. Or will the fine apply to each operation? Will the initiator of operations of a pyramid selling firm be liable to a £400 fine in relation to each new recruit?
    Mr. Raphael Tuck: That would not be enough.
    Mr. Williams: My hon. Friend says that it would not be enough, but one would assume that in those circumstances other fines, relative to the multiplication of offences, would come into operation, and there would be a possibility of imprisonment.
    Mr. Tuck: A long stretch.
    Mr. Williams: It would be valuable if these were spelt out in the starkest form. We should be happy to give the Minister the opportunity to warn pyramid sellers just how harsh can be the penalties, but he should warn the House if penalties are to be as minute as my hon. Friend feared they might be.
    How far will these penalties be valid? I am not pretending that this is an easy situation, but what is the sanction where a company chooses to site its base in Holland, Belgium, or France? That has been done with certain firms sending pornographic literature to this country, thereby escaping the controls which we operate internally. What is likely to happen if the arch-villain decides to make his main base in a Common Market country, which lie is perfectly entitled to do? Then it is only his unfortunate victims who will face the sanctions outlined in the Bill. How do the Government envisage dealing with that type of
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    situation? I do not pretend that it is an easy situation but it is a problem which might arise.
    11.15 p.m.
    In particular, will the right hon. and learned Gentleman investigate the activities of a firm whose letter has been sent to me by special delivery from one of the consumer protection bodies? I will give the Minister a copy of it so that his officials can look at it. This is a company which I feel should be considered. It is called Bestline Products. I believe that it is one of the antecedents of Golden Chemicals. Many of the companies which have brought pyramid selling into disrepute are now well known by name, thanks in many instances to the publicity given to them by hon. Members, and in particular by my hon. Friend the Member for Watford. Bestline is one of those companies which tends to be rather subdued.
    Mr. Tuck: I do not know whether my hon. Friend is aware that Bestline had a chequered career in America and that Jerry Brassfield, who was head of it, left America very quickly and then appeared here as a director of Golden Chemicals.
    Mr. Williams: The link is quite clear. I am obliged to my hon. Friend. This is a company which does not court publicity but which has been particularly active in building up its business among immigrant communities. It knows very well that among such communities there is, on the one hand, a considerable ignorance of the legal protection which exists against this type of business and, on the other hand, there is, perhaps, a greater than normal reluctance to use that legal protection.
    This company has distributed a letter from its office in Potters Bar which says:
    "Dear distributor. You have probably wondered why you have not received either a July calendar or a notice of our intended move to Watford. Well, the reason is that over the past few weeks Mr. Finley has been working on a marketing scheme to overcome all the fears and doubts of all our distributors about the proposed legislation by the British Government on pyramid selling, and to prove to everyone that Bestline are in the business of selling cleaning products with an ample opportunity for anyone to succeed."

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    Already it admits that it has been looking for a loophole, looking for a way round the legislation. I will not read all of the letter and if I quote from parts I hope that I shall not be accused of being too selective. It goes on:
    "From the 1st August, therefore, Bestline will have general distributors only, to whom the company will sell the product at a discount of 55 per cent. Each general will be running their own businesses."
    I will not comment on the grammar. It obviously has American antecedents.
    Sir G. Howe: It is not Welsh.
    Mr. Williams: It would have been three times as long if it were Welsh. The Totter goes on:
    "Existing direct distributors will purchase what they need from their general distributors at a discount of 40 per cent. It will be the duty of each general distributor to hold a stock of product in order to supply their agents."
    That is the point my hon. Friend the Member for Watford raised. It continues:
    "Anyone may become an agent of a general distributor in Bestline if they so wish. In order to, become a general distributor in Best-line an agent must"
    not "may"—
    "purchase a total of £4,500 from his or her general distributor in one year. Training sessions will be held in various places each month and corporate members of the Company will be in attendance at many of these meetings".
    It does not mention whether there will be a charge for attendance at the sessions or whether there is any compulsion about attendance. The document continues:
    "A Direct Distributor has until August 1st a chance of becoming a General Distributor on payment of £250 to his General for the purchase of the extra 15 per cent. The General School will be held in Madrid at the end of August and all those entitled to go shall attend. Any other General may attend on payment of £250".
    I shall give this document to the Minister. As a non-lawyer, I am not able to assess how far this revision of the structure of this pyramid selling company will enable it to escape any of the controls which the Minister hopes to introduce by this Bill. However, I know that the right hon. and learned Gentleman's officials will look at it as a matter of urgency. It should be looked at urgently and, if necessary, action should be taken against the firm concerned.
    Mr. Tuck: Is my hon. Friend aware that in many cases, when people purchase from the company £1,000, £2,000 or £3,000 worth of stock, they might sell £300 or £400 worth and then find that they are out of pocket and have to unload the remainder in the market at very low prices, thus hampering other people trying to sell at the recommended prices?
    Mr. Williams: There is no reference in this document, despite compulsion to purchase certain amounts in a year, to any buy-back facility. My hon. Friend is right in giving that warning.
    As this may well be the last major debate at this stage of the Bill, may I trespass on your tolerance, Mr. Speaker, and take this opportunity to make a positive statement of Opposition policy on the operation of the Bill because it may be helpful to the Minister. The Government will have to recruit personnel for the directorate, many of whom may be offered the opportunity, or asked to make the sacrifice, of leaving the Civil Service and going into the directorate, and they must inevitably be concerned about their futures.
    Our approach to the directorate will be positive and, I hope, constructive. We shall not undo the basic framework envisaged in the Bill. That does not mean that we shall not replace the Consumer Protection Advisory Committee. That we shall do. When in Government we shall include professions within the provisions of the Bill and we shall give the same powers in relation to health and safety interests of consumers as are given in the Bill to economic interests.
    I know that I am going further than I should, but I think that this is a helpful point at which to make this statement as recruiting for the directorate is soon to take place. The Opposition have no intention of abolishing the directorate, only to review and strengthen it at appropriate times. I hope that this statement will help in the recruiting process. I wish the Director and the members of his staff every success in their endeavours.
    Sir G. Howe: By leave, may I say that I welcome the observations of the hon. Member for Swansea, West (Mr. Alan Williams), although they may have been founded on a rather remote hypothesis. They will, nevertheless, assure some of

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    the younger civil servants who will be appointed to take up positions in the directorate that they can look forward to long and settled future careers—so long that they stretch into the period of office of the next Labour Government. That will give them much comfort.
    I mean no unkindness to the hon. Member for Watford (Mr. Raphael Tuck) when I suggest that it is a pity that the non-stop train from Watford which rattled through the Chamber as he spoke, firing off question after question, did not find time to discharge some of the questions in writing a little earlier than at this penultimate stage in the proceedings on the Bill. I am comforted to find that, as far as I can answer them, the answers are entirely satisfactory to me and the hon. Member.
    He referred to the representations of the PIRC, the Public Interest Research Centre, which has ceased to exist as such and has changed its name to Social Audit. The points that it made on the original amendments were closely considered and have been taken into account in the present form of the new clauses. He will find them reflected in particular in new Clause E(2) and new Clause F(2).
    The hon. Member will find that it is hardly a valid criticism to complain at the complexity of these provisions, because they are designed to be complete and they must necessarily be widely drawn and complex to achieve their effect. He referred to the extent to which people might evade the prohibition by conducting pyramid selling businesses from their own premises. That point is dealt with in new Clause E(4).
    The hon. Member also suggested that the scope of the regulations provided for in new Clause F(2)(e) was too narrow, but I think he will find that that paragraph relates back to the supply of services mentioned in paragraphs (a) to (d), so that also has a wider scope than he implied.
    The hon. Gentleman suggested that there was no power to define territories in which agents could operate, but he will find that the regulation-making power in new Clause F(3)(b),
    "specifying rights required to be conferred. and obligations required to be assumed by the promoter or promoters"
    will be sufficient to deal with that kind of thing. It will also include provision to
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    be made for the assumption by the promoters of agency responsibilities in relation to characters "out in the bush" on their behalf.
    Mr. Tuck: Why leave that to the regulations? The power to make regulations surely is specifically included so as to stop any evasion of or getting around the law. Why not at this stage put that into legislation? It could be done quite simply.
    Sir G. Howe: For the very reason which I would have thought had impressed itself more clearly upon the hon. Member than on anyone else—that we are here designing provisions which are intended to be flexible and adaptable in the face of people who are capable of reacting as the hon. Member so vividly described. As our consultative document said, to some extent, it would be easy enough to formulate a provision to provide for agency operations which would seem to be sensible, but, on the hon. Member's own analysis, that would be a temptation, set out in primary legislation, for those with whom he has been concerned for so long to wriggle around it.
    With respect to the hon. Member's intellectual analysis, I cannot see how he can criticise us on those grounds. All the provisions that he wants, and more, can be made by regulation. I am sure that it is right to have that kind of flexibility to deal with the kind of point that he has in mind.
    Mr. Tuck: If there were a clause stating that an agreement should designate a specified territory and another clause saying that an agreement should designate the agent or the participant as agent of the company as an independent contractor, how could that be got round?
    11.30 p.m.
    Sir G. Howe: I do not wish to be unkind to the hon. Gentleman's private authorship. I can think of half a dozen ways round each of them. It is not for me to give gratuitous advice as to how to evade that kind of provision, but each word used by the hon. Gentleman represents a loophole. He refers to a company for example. Who knows that the organisation will be a company? Much though we pay tribute to the hon. Gentleman's zeal in the pursuit of these activities, there is a limit to the extent

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    to which I bow down and say that all that he says is right. On this occasion, we have got it more right than he has, simply because of the flexibility which we provide.
    The hon. Member for Swansea, West asked on whom the duty to enforce was imposed. We considered whether it should be placed on the director general or on local enforcement authorities or whether the responsibility rather than duty should rest with the Department. We felt that the latter course was right. Most of these organisations are national ones whose activities extend to many different localities. Therefore it is right to have a central enforcement agency in the form of the Department.
    Mr. Alan Williams: I accepted the right hon. and learned Gentleman's point about enforcement and said that I felt that it should be national. But that does not answer my other point, which is that the first information may be found locally. In such a case, on whom is there a duty to search out such information, and what procedure is there to ensure that it is passed to the centre?
    Sir G. Howe: There is no express duty to collect information. I am sure that the lion. Gentleman will acknowledge that there has been no problem about the gathering of information about these practices and the transmission of it to my Department and to hon. Members. There has been no problem involving the gathering of information by the media and its ready transmission to us. The only question is who is to react to it. In the light of the publicity given to these practices, any information about it is likely to be quickly transmitted.
    I was asked when the regulations are likely to be in force. I hope that they will be ready and brought into force before the House returns from the Summer Recess.
    I was asked about the statutory defence available under new Clause H (2)(b). That statutory defence is one for promoters charged under new Clause G (6), which provides that if a participant or promoter commits certain offences, the promoter or other promoters will be guilty of those offences. In those cases only, promoters will have a good defence
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    if they can show that the trading scheme to which the charges relate was in operation before the Act came into force and that the offences were committed without their consent or connivance. Even in our enthusiastic pursuit of these pyramid maniacs, it would be carrying enthusiasm too far to provide for guilt by association retrospectively.
    As for the scope of liability, how far people can be involved by being promoters in relation to the activities of participants is provided for by the provisions of new Clause G (6). Where the person by whom an offence is committed under subsection (3) is not the sole promoter of the scheme, any other person who is the promoter or one of the promoters shall also be guilty of that offence. If 20 participants are guilty of offences by seeking to multiply the sub-participants, in relation to each participant any promoter is also guilty of an offence. So that quite a number of offences can be charged against a promoter if one can involve a number of participants.
    As for the scale of the penalty, the House will have seen in new Clause I that even on summary conviction provision is made not merely for a fine of up to £400 and I take the point of the hon. Member for Watford that that could be regarded as being no more than the barrow boy's £2 fine in a magistrates' court for parking his barrow in Oxford Street—but also for a term of imprisonment of up to three months. That is unusual in modern penal practice. In addition, at the option of the prosecution proceedings may be taken an indictment, in which circumstances the maximum penalty may be two years or an unlimited fine. That should be enough to satisfy the anxieties of the hon. Member for Watford, at least for a day or two.
    The particular company referred to by the hon. Member for Swansea, West Bestline Products—is known to the Department. We are investigating it, and if it proves to come within the scope of the legislation, the appropriate steps will be taken in relation to it.
    Dr. Dickson Mabon: The Minister was kind enough to explain the complicated references to participants, promoters, and sub-participants, and the fact that there could be an aggregation of charges. I

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    did not follow the summation of the points he made. Does it mean that there could be so many offences that there would be a multiplication of the fine of £400 as well as imprisonment, as a possibility?
    Sir G. Howe: If the promoter is charged and found guilty in relation to a series of offences by a number of participants the promoter, in so far as he is convicted of more than one count or charge, would be liable to the maximum fine of £400 times the number of offences involved. I am glad to see that the hon. Member for Watford is filled with pleasure at that prospect.
    I hope that I have dealt with most, if not all, the points that have been raised. We believe that we have covered this activity as far and as sensibly as we can, and as flexibly as is necessary.
    Question put and agreed to.
    Subsequent Lords amendments agreed to.

  Clause 114

    PUBLICATION OF INFORMATION AND ADVICE BY DIRECTOR
    Lords Amendment: No. 48, in page 88, line 20, at end insert:
    "( ) Without prejudice to the exercise of his powers under subsection (I) of this section, it shall be the duty of the Director to encourage relevant associations to prepare, and to disseminate to their members, codes of practice for guidance in safeguarding and promoting the interests of consumers in the United Kingdom.
    ( ) In this section "relevant association" means any association (whether incorporated or not) whose membership consists wholly or mainly of persons engaged in the production or supply of goods or in the supply of services or of persons employed by or representing persons so engaged and whose objects or activities include the promotion of the interests of persons so engaged."
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    This is the only other amendment of substance that is new to the House in dealing with the Bill. Hon. Members on both sides will probably remember that when we debated this matter in Committee upstairs I indicated that, whilst I had some feeling of support for the proposal—and that was proved by a certain
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    voluntary code which I was able to introduce later—I was not certain whether we should be able to spell it out in the Bill.
    I pay tribute to an ex-right hon. Member of this House—now a right hon. Member of another House, Lord Diamond—who moved the amendment in another place. I have always had a liking not only for him but for his particular appreciation of impressionist art, which I have enjoyed on certain Commonwealth Parliamentary Association tours. In this instance he left the art gallery to come down to earth to consider the way in which this matter could be spelt out in the Bill. We have considered the question, and we believe that it is possible to spell this out in the Bill.
    This means that we shall strengthen the director's influence in this specific area. The Government have always supported such codes, because the Government and both Houses believe that they should be encouraged. The amendment demonstrates that this type of code is a sensible and excellent way of adding to some of the powers of control over certain practices without necessarily having to legislate by statutory instrument immediately in order to deal with the matter.
    I hope, therefore, that hon. Members on both sides of the House will be pleased that we have been able to come this far in spelling out the matter in the Bill.
    Mr. Roper: 1 am glad that the Government found their way to accept what is effectively the amendment which was moved by my noble Friend Lord Diamond and tabled by Lord Jacques in another place and which had originally been moved by my hon. Friend the Member for Glasgow, Craigton (Mr. Millan) in Committee in the Commons. We felt quite strongly about this point. We believed that it was possible, within the structure envisaged for the director general, to have the provision not merely for putting forward secondary legislation and getting the approval of the Secretary of State and coming to the House, but for making use of trade associations to draw up codes of practice of this kind.
    I hope that, like many other provisions of the Bill, this one will be used energetically and effectively by the director general and the trade associations when the Act comes into effect.
    Mr. Alan Williams: I, too, welcome the fact that the Government have been able to incorporate another of our Committee amendments within the Bill.
    I should like to ask four specific and brief questions. What is the standing of such a code of practice? What requirement will there be for its observance? What will be the sanction for any breach of such a code? Is the code simply a formality, or will it have meaningful significance from both the public and the legal point of view?
    Mr. Emery: With the leave of the House, I should like to reply.
    I think that the hon. Member for Swansea, West (Mr. Alan Williams) is probably fully cognisant of the varying effects of varying codes.
    When we debated this matter in Committee, one of my worries was that we might need to standardise a code and not allow it to be introduced and used by those who wish to govern their own disciplines. Being judged by one's peers is often much harsher, as certain hon. Members know, than having to deal with ways round a statutory instrument or a piece of legislation. Therefore, codes of practice will be encouraged by the director general to be flexible enough to deal with whatever specific practice or practices there may be within a particular area.
    I am not trying to avoid answering the hon. Gentleman. It is right and proper that we should ensure that, where a code of practice is brought in, the director general should be able to guide the body dealing with it. The body concerned may in certain instances have stricter disciplines than we might expect for minor infringements if dealt with by a statutory instrument. This is part of the benefit of the flexibility of such a code. Therefore, I hope that the House will agree to the amendment.
    Question put and agreed to.
    Subsequent Lords amendments agreed to.

  Clause 127

    GENERAL INTERPRETATION PROVISIONS
    Lords Amendment: No. 53, in page 96, line 15, after "undertaking" insert:
    "which is carried on for gain or reward or which is an undertaking".
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    This amendment stems from a suggestion made by the Law Society to my right hon. and learned Friend. The Law Society suggested that the definition of "business" in this clause might be regarded as excluding certain undertakings which should be covered.
    "Consumer" is defined as a person to whom goods are supplied in the course of business in order to exclude private undertakings. "Business" is defined at present as including undertakings
    "in the course of which goods or services are supplied otherwise than free of charge".
    The amendment adds a reference to undertakings
    "carried on for gain or reward".
    Question put and agreed to.
    Subsequent Lords amendments agreed to.

  Clause 130

    SHORT TITLE, CITATION, COMMENCEMENT AND EXTENT
    Lords Amendment: No. 55, in page 100, line 27, at end insert:
    "( ) Where any provision of this Act, other than a provision contained in Schedule II, refers to the commencement of this Act, it shall be construed as referring to the day appointed under this section for the coming into operation of that provision.".
    11.45 p.m.
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this we are to take the following Lords amendments:
    No. 63, in Schedule 11, page 117, line 40, at end insert:
    "and" the commencement of this Act", where that expression occurs in any provision of this Schedule,—

    (a) if the same day is appointed under section 130 of this Act for the repeal of all those enactments, means the day so appointed, or

    (b) if different days are appointed under that section for the repeal of different enactments, means such day as may be specified for the purposes of this sub-paragraph in an order made by the Secretary of State by statutory instrument;

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    and different days may be so specified in relation to different provisions of this Schedule."
    No. 71, in Schedule 12, page 122, line 43, column 2, leave out "commencement" and insert:
    "coming into operation of Part IX".
    Mr. Emery: The House will recall that Clause 130 was amended in Committee to make provision for different parts of the Bill to be brought into operation at different stages. These amendments are purely consequential and import no change of substance in the Bill
    Mr. Edward Taylor: May I ask my hon. Friend to take this opportunity to let us know what date he has in mind for commencement and also when we may be told of the appointment of the director general?
    Mr. Emery: My hon. Friend will know that my right hon. and learned Friend and I are as keen as he is to announce to the House and, indeed, to the world who will be the director general. We wish to make the announcement as soon as possible, but we have always said that it is imperative that we should be able to ensure that the person designated is of the calibre that both sides of the House wish to see.
    A number of candidates are under serious consideration. I hope that it will be possible to reach a decision as early as possible and that the office of the director general can begin to operate in the autumn.
    Question put and agreed to.

  Schedule 1

    DIRECTOR GENERAL OF FAIR TRADING
    Lords Amendment: No. 56, in page 101, line 34, at end insert:
    ". Anything authorised or required by or under this Act or any other enactment to be done by the Director, other than the making of a statutory instrument, may be done by any member of the staff of the Director who is authorised generally or specially in that behalf in writing by the Director."
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    We have been advised that it would be unsafe to assume that the director will
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    have an inherent power to delegate his statutory duties to his staff. In certain circumstances that would obviously be nonsense, and the amendment is designed to put the position beyond legal challenge.
    Question put and agreed to.

  Schedule 5

    GOODS AND SERVICES REFERRED TO IN SECTION 16
    Lords Amendment: No. 57, in page 107, line 45, leave out "rail or air" and insert "or rail".
    Sir G. Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this we are to take the following Lords Amendments:
    No. 58, in page 108, line 1, leave out "or air".
    No. 62, in Schedule 7, page 109, line 12, at end insert:
    ". The carriage of passengers or goods by air."
    Sir G. Howe: This trio of amendments is designed to correct an anomaly in relation to airlines. As the Bill stood, provision was made in relation to air services in Schedule 5 and in Schedule 7. When these amendments are made it will be possible for the director, under Clause 16, to make a reference to the CPAC of a consumer trade practice relating not only to private airlines but also to State-owned airlines.
    On the other hand, the restriction on the power of the director to make a monopoly reference under Schedule 7 will remain and will extend to civil aviation services generally, to the carriage of passengers or goods by air. The way is open for references under Clause 16 in relation to private or State-owned airlines, but the director will be excluded from the right to make references under Schedule 7 in relation to private as well as State-owned airlines.
    Mr. Millan: As this kind of matter about the nationalised industries was discussed extensively in Committee, we agree with the amendment. It is satisfactory that the nationalised airlines should now be subject to reference.

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    It is slightly ironic that when the Bill was in another place the nationalised airlines established consumer consultative councils. We very much welcome that.
    Lady Burton has carried on a considerable campaign on this issue, with particular reference to the closure of the West London air terminal. As it happens, I have also made representations to British European Airways about its decision. I am glad that BEA has established a consumer council. Even so, the amendment is desirable because it puts the nationalised airlines on the same basis as the private airlines.
    Question put and agreed to.
    Subsequent Lords Amendments agreed to.

  Schedule 7

    GOODS AND SERVICES (IN ADDITION TO THOSE IN SCHEDULE 5) WHOLLY OR PARTLY EXCLUDED FROM SECTION 50
    Lords Amendment: No. 61, in page 109, line 8, at end insert ". Water."
    Sir G. Howe: I beg to move, That this House doth agree with the Lords in the said amendment.
    This is remarkably laconic, The amendment is for the insertion of one word in the schedule, to include in the list of statutory monopolies in relation to which the director general may not make a monopoly reference that vital commodity, water. There was an oversight in relation to the statutory monopolies which ought to have been included in the schedule. I am sure that the House will not object to this inclusion.
    Question put and agreed to.
    Subsequent Lords Amendments agreed to.

  Schedule 11

    TRANSITIONAL PROVISIONS AND SAVINGS
    Lords Amendment: No. 64, in page 119, line 20, leave out from "undertaking" to "is" in line 21 and insert:
    "given to a Minister which"
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.
    Mr. Deputy Speaker: With this it will be convenient to discuss the following Lords Amendments:
    No. 65, in page 119, line 25, at end insert:
    "and which either—

    (a) was given before the commencement of this Act, or

    (b) is given after the commencement of this Act in a case where no request under subsection (1) of section 88 of this Act has. been made to the Director to carry out consultations in accordance with that subsection."

    No. 66, in page 119, line 27, at end insert:
    "and the Minister to whom any such undertakings was or is given shall furnish particulars of it to the Director".
    No. 67, in page 119, line 36, at end insert:
    "( ) The preceding provisions of this paragraph shall have effect without prejudice—

    (a) to the duty of the Commission under section 86 of this Act to transmit to the Director copies of reports which were made by the Commission before the commencement of this Act and which, by virtue of paragraphs 1 and 7 of this Schedule, have effect as if made under this Act, or

    (b) to any duty of the Director, where requested by the appropriate Minister or Ministers to do so with respect to any such report, to carry out such consultations as are mentioned in section 88(1) of this Act."

    Mr. Emery: These four amendments complete the transitional provisions concerning follow-up action on the Monopolies Commission's reports made before the director takes over his monopoly duties. It is right and proper that we should safeguard this period. That is what the amendments do.
    Question put and agreed to.
    Subsequent Lords amendments agreed to.

  Schedule 12

    ENACTMENTS AMENDED
    Lords Amendment: No. 69A, in page 121, line 13, column 2, at beginning insert:
    "In section 22, after subsection (4) there shall be inserted the following subsection:—
    '(5) The foregoing provisions of this section shall not apply in relation to any order made under section 21A of this Act.'"
    Mr. Emery: I beg to move, That this House doth agree with the Lords in the said amendment.

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    There is some confusion over the printing of the amendment. It is on page 15 of the amendment paper. It has no number. That is why we have identified it as No. 69A. The initial page and line reference is missing. The amendment is consequential on the amendments to Clause 102, Lords Amendments Nos. 35 and 36.
    Mr. Deputy Speaker: Let us be clear which amendment we are discussing. Lords Amendment No. 69A, on my copy of the paper, begins
    "in section 22, after subsection (4)".
    Mr. Emery: That is what I hope I am moving. It is that
    "in section 22, after subsection (4) there shall be inserted the following subsection:—
    '(5) The foregoing provisions of this section shall not apply in relation to any order made under section 21A of this Act'."
    There can be no doubt about that. As I said, it is on page 15 of the Lords amendments.
    It is appropriate that at this stage I should pay tribute to the immense amount of work which has been done by the officials in the preparation of the Bill. All hon. Members will want, although it is not always done, to pay tribute to the outstanding work they have done. Because of the intimacy in which the media have brought all of us together at certain times during the proceedings on the Bill, the work done by the officials has become more than evident.
    The House has agreed to Lords Amendments Nos. 35 and 36 which prescribe the procedure by which the Restrictive Practices Court may discharge or vary an interim order. In Section 22 of the Restrictive Trade Practices Act there is already provision for the court to vary other decisions. It is desirable to make it clear that these provisions do not apply to interim orders. Separate provision is made for them in the new subsection which is to be inserted in the 1956 Act by Amendment No. 35. The amendment accordingly adds a new subsection to Section 22 of the 1956 Act to make it absolutely clear that the provisions of that section do not apply to interim orders under the new Section 21A.
    Mr. Robert Hughes: I wish to associate this side of the House with the Under-Secretary's remarks. I join
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    him in congratulating the officials who have done so much work in preparing the Bill and incorporating within the final form of the Bill so many of the points that were made in Committee. I await agog, as do many other hon. Members, to see the television programme on Tuesday night. [Interruption.] We will watch all three programmes with the greatest of interest to see whether these prima donnas of the private office are as genial in their own lair as they are when operating in our spheres.
    Sir G. Howe: I am not sure whether I need the leave of House, but I ask for it in any event.
    I beg to move that this House doth agree with Granada Television in the said television programme. The programme to which the hon. Member for Aberdeen, North (Mr. Robert Hughes) refers will be transmitted at 22.30 hours on Monday. It has been promoted to being the first of the three and is appropriately entitled "The State of the Nation"-which nation I am not sure.
    I join my hon. Friend the Under-Secretary in paying tribute to those who have taken part in the work on the Bill. I wish to pay tribute in particular to the part played by the hon. Members for Swansea, West (Mr. Alan Williams) and for Glasgow, Craigton (Mr. Millan) and all their colleagues and by my hon. Friends who have shown such a tenacious and sustained enthusiasm, even to this late hour. I am sure we shall all get joint top billing for the programme on Monday.
    Question put and agreed to.
    Remaining Lords amendments agreed to.

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

PARLIAMENTARY YEAR
12.1 a.m.
Mr. Jerry Wiggin (Weston-superMare): Intrigued by the trailer for that television series, I am glad that the stars have now left the floor to us. I am grateful for the opportunity to raise at this

671
time of year the question of the parliamentary year and the calendar of our Sessions and Recesses. I deliberately postponed applying for this Adjournment debate until the humid, long and tiring days of July were upon us so that the difficulties of sitting at this time of year should be apparent to my hon. Friend the Parliamentary Secretary.
I should like to thank my right hon. Friend the Leader of the House for writing to me and explaining why he is not able to respond to my debate, but in some respects it is perhaps propitious because my hon. Friend who is to reply has for long taken a considerable interest in the welfare of hon. Members and their families, and I know that his wife has interested herself considerably in the welfare of Members' wives. This is something which is frequently forgotten in this place.
My point in raising this matter is to direct to the attention of the authorities of the House the position not only of Members but also of the many hundreds of other people who are involved when the House is sitting. The staff of the House immediately come to mind—the officials, the Official Reporters, the police, the cleaners, the civil servants on parliamentary duties in every Government Department, members of the Press and individuals in embassies and companies. Of course, like us they have families whom they like occasionally to see when they are not performing their official duties. It seems to many of us that our present arrangements impose the maximum of suffering quite unnecessarily on a large number of people. I shall try to explain briefly how I see the problems.
I fully acknowledge that the Select Committee on Procedure dealt with this matter in the Session 1967–68 in a report entitled "The Dates of the Session; the Financial Year", but that Select Committee sat some five years ago and to my knowledge nothing has been done subsequently. I hope that what I have to say tonight might perhaps spark off a new investigation into the possibility of trying to alleviate some of the unnecessary distress caused by the present arrangements.
I accept, as the Select Committee accepted, that there is no need basically to alter the total length of our Session. I
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have looked up the length of the Session in the last 10 years. Starting with 1962–63, the length of the Session in terms of days for that and each succeeding year is as follows: 162, 155, 178, 65—that was an election year, followed by a Session of 246 days, giving an average for the two of 160. In 1967–68 the length of the Session was 176 days, and in the succeeding years it was 164, 122, 206 and 180. If the current Session sits until 25th July, we shall have sat for 156 days this time. If one accepts that basic precept—that the Session should be neither lengthened nor shortened—one is left with the question of how to fit the right number of sitting days into the gap with the recesses in between.
I hope that we can consider a method of rising at the end of June. Clearly, that would have a quid pro quo in that the House would have to make up the days it lost during July by sitting in the autumn, presumably from about the middle of September or even a little earlier—say, the end of the first week in September—until the hang-over business is concluded, then allowing time for the party conferences. The new Session would start at about the same time as it does now.
I appreciate that the party conferences cause a difficulty, but it would be wrong for the House to adjust its own business only because they could not be fitted in except at that time of year. It was, I think, only in about 1948 or even later that the party conferences stopped being held at Whitsun. I do not suggest that the whole panoply of a party conference should be altered, but I cannot imagine, with the new conference centres being built round the country and the other facilities becoming available, that we must be quite so inflexible about when the party conferences should be held.
I should like to draw attention to the tourist figures for the past three years. In 1970, for example, in June there were 509,000 tourists, in July 821,000, in August 680,000 and in September 446,000. In 1971 the comparable figures were 571,000, 907,000, 690,000 and 478,000. In 1972 they were 580,000, 896,000, 682,000 and 532,000. July and August are outstandingly the major tourist months. Any hon. Member who has an office outside the building or who approaches it on his own two feet will be well aware that in July and August

673
every tourist who enters the country appears to visit Westminster Abbey and Parliament Square at least once, and many come to this building.
The tourist authorities tell me that about 80 per cent. of all the tourists who come to this country visit London. On the assumption that the majority visit this part of London, there is quite a good case for leaving it to them for July and August. I am the first to acknowledge that the tourist industry is of great importance and that it would be wrong to try to restrict tourists. We must live with them.
I know that my hon. Friend the Parliamentary Secretary is rightly very interested in family life. It is obvious that the school and university holidays have become completely out of gear with the parliamentary year. That causes considerable difficulties to all those with members of their family who are of school or university age. To see one's family is difficult enough at present, with the ordinary constituency duties that hon. Members have to perform, travelling, speaking engagements, and so on. But to make it doubly bad by ensuring that one's children are at school when we are in recess and vice versa seems unnecessary.
The university year apparently now concludes in about the middle of June. This year Oxford rose on 22nd June and Cambridge on 15th June. School holidays depend to some extent on the local education authority, but the second week in July is usually about the latest that schools break up. It appears that public schools are also breaking up at about that date. The university board examination for A- and O-levels are held in the last week or two of June and the first week of July.
Next we must consider the technical reasons which are said to preclude such an arrangement as I suggest. The Select Committee examined pages of evidence from the Treasury. There seem to be innumerable historic and bureaucratic reasons for not altering the Treasury year. Any hon. Member who has ever been responsible for a business which has altered its financial year will have some sympathy with the problem. It is not easy. Difficulties are created, but those difficulties are far from insuperable.
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The necessity to alter our financial year should not be an objection which cannot be overcome.
Third Readings of Finance Bills during the last 10 years have been before the end of June or in the first week of July in six years out of the 10, one of which was 1970, which was an exceptional year. For the other five years Third Readings were always in the first half of the month. It would seem that, even if we adopted the same financial year, the Finance Bill is not an excuse for not rising rather earlier.
I accept that there is a difficulty about the number of Supply Days which, according to Standing Orders, have to be dealt with by 5th August. We would have to change a Standing Order if we were to allow Supply Days to be taken in the held-over part of the Session.
I have the dates for the rising of the House. In 1963 we rose on 30th July; in 1964, 31st July; in 1965, 5th August; in 1966, 12th August; in 1967, 28th July; in 1968, 26th July; in 1969, 25th July; in 1970, 24th July; in 1971, 5th August; and in 1972, 9th August. We shall soon know whether we are to rise this year on 25th or 26th July. We are talking about three or possibly four weeks when our dates could, and I believe should, be altered.
We are keen at the moment to conform with Community practices. The details are not easy to obtain but it appears that Belgium, Germany, Italy, Luxembourg, France and Holland have financial years which start on 1st June. Sessions end in June or early July in Belgium, Denmark and Germany. Other Parliaments have very different practices from this House. The hours which they sit are different and to make comparisons is difficult. However, it would seem that we would be far from out of step if we were to make the change which I suggest.
I see no reason for not giving this suggested change a try. The noble Lord, Lord Diamond, in giving evidence to the Select Committee in 1967, said that he could not envisage an alteration of the financial year as such an alteration would be incapable of being carried out until 1972 at the earliest. Clearly we are already past that date. I hope that Her Majesty's Government will reconsider the matter. We could keep the same financial year and yet rise earlier. That

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is a matter purely for this House. If that proved convenient, no doubt the Treasury could overcome any difficulties and reorganise the financial year. An earlier rising could then become part of the normally accepted parliamentary year.
12.14 a.m.
The Parliamentary Secretary to the Civil Service Department (Mr. Kenneth Baker): When I was listening to my hon. Friend the Member for Westonsuper-Mare (Mr. Wiggin) I could not help recalling that someone, somewhere, on some occasion, remarked that a week in politics was a long time. When my right hon. Friend the Leader of the House asked me to reply on the subject of a whole parliamentary year, I thought I might be bordering upon a political eternity.
My hon. Friend, with his usual clarity, brevity and good and thorough research, has set out in specific terms his concern about the present arrangements of our business and his plea that we could now profitably make a change.
I want first to emphasise that my hon. Friend's choice of the title, "Parliamentary year", is obviously a very deliberate one. To avoid misunderstanding outside this House, I want to make it clear that we are not talking about the Member of Parliament's working year or the Minister's working year.
There is no question here of MPs asking for longer holidays. Any such suggestion is based on a misunderstanding of an MP's life. It makes the mistake of assuming that Westminster is an MP's office and that when he is not there he is not at work. I am sure my hon. Friend will agree with me that this is very far from the case. The Recess is not all holiday. Most of it should be described as an essential break in parliamentary business which allows MPs to devote more of their time to work in their constituencies.
What we are talking about is the feeling among some MPs who are so often parted from their families for long periods that, if there is an opportunity for them to be working at home during school holidays, it should be taken. Political life imposes upon an MP many strains, but the greatest of all is that
676
imposed on his family and I think that we should do everything we can to reduce this strain.
My hon. Friend has taken up the argument put to the Select Committee on Procedure in 1968 that changes in the school holidays have meant that Members, particularly in Scotland and the North of England, have been separated from their families for almost a month of their school holidays.
I believe it is the custom in Scotland for schools to break up at the beginning of July. Certainly many schools in England do. My children broke up a week ago. This is a very important factor. My hon. Friend also mentioned the universities and their terms. That is a matter of opinion. I think it is rather nice to be with one's children when they are small, but I do not know whether, when mine go to university, I will want them with me or, indeed, whether they will want to be with me. I have some doubts about that.
Hon. Members will recall that in 1968, just after these changes had become evident, the Select Committee on Procedure did not come to a final decision although it provided a most useful analysis of the problem. My hon. Friend has argued that experience since then, and the influx of younger Members with school age children into the House, makes these arguments all the more cogent. I also noted what he said about the financial year.
I assure my hon. Friend that the Government recognise the problem posed by the different financial years in the EEC countries. We have also noted the Irish Government's intention to go over to the calendar year basis in 1975. As Treasury Ministers have announced, we have therefore set in hand a study on this matter.
If a change in the financial year were to be recommended, it would, of course, mean changes in the timing of parliamentary business, and I can assure my hon. Friend that the points he has made tonight will be taken into account. I think, however, it is fair to say that while it would obviously be sensible for decisions on any change in the financial year to be taken at the same time as a decision on the parliamentary year, the latter change is not dependent on the

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former. It would be possible to do the one without the other.
Indeed, as my hon. Friend has pointed out, the Finance Bill used to be a tremendous blockage during the summer, but ever since it was split in 1968 it has become very much less so. It has, in fact, been deglamorised since then, and in my view rightly, because the other economic debates during the year, like the public expenditure debate just before Christmas and the various others on subjects such as the Price and Pay Code, are as important as the Finance Bill, which now passes through the House in a much easier way.
This is very much of a pattern of how Parliament changes over the years and, indeed, how the dates of Sessions change over the years. When I was reading Robert Blake's biography of Disraeli, I came across an account of how our predecessors did things in those days. I should like to give the following quotation:
"Summer after summer when the Session ended, often late in August, the Disraelis would repair to Hughenden, and unless the Conservatives were in office when Cabinet meetings made it necesary to return to London in late October"
—that is rather nice, two months without Cabinet meetings—
"they would stay there until after Christmas. Autumn Sessions were rare in those days. Indeed, in that Indian Summer of aristocratic rule the life of a politician was in almost every respect more agreeable than it is today. There was far more time for thought and reflection."
Therefore, when people refer to the good old days, a vision of the Disraelis going to Hughenden in August and not coming back until January springs to my mind and I can see the gleam of nostalgia in the eyes of my hon. Friend. I fear, however, that such days are long past.
The aristocrats' benevolent paternalism has been replaced by the yoke of the burghers' rule. We are the most hardworking legislature in the world. The Procedure Committee published some very interesting figures which show that the House of Commons averages some 1,350 hours in a Session per year as against 1,000 in Canada, 920 in the United States of America, 540 in France and 260 in Germany. We sit five times as long as the Bundestag. It seems obvious, therefore, that we should do
678
what we can to reduce the strain imposed by long Sessions and long hours.
I turn briefly to the various factors of constraint on the changes suggested by my hon. Friend. First, there may be the views of those hon. Members who do not have children of school age and who prefer the present arrangements. Second are the changes which might have to be made to other Recesses to pay for an earlier summer break. For example, to get through the business it might be necessary to shorten the Christmas Recess or to ask hon. Members to return earlier in the autumn and accept a longer spillover period, to come back in September to catch up on the lost period. This might not be welcomed by all hon. Members.
Third, and I think most important of all, are the difficulties which my hon. Friend recognised of rearranging the party conferences, which have to be held out of the holiday season, otherwise we could not get in at the two towns to which the two parties seem to be irrevocably committed. October is the most convenient time for the Conservative and Labour Party conferences and changes in the dates might prove awkward.
It is perhaps ironic that the one thing which party conferences dictate with absolute authority to the parties and to this House are the dates of our Sessions. However, I do not believe that any of these difficulties would prove insurmountable and beyond the wit of the ingenious managers who have contrived to provide for us to rise in any event during next week.
The introduction of new procedures such as the Statutory Instruments merits committee may help by relieving the full meetings of the House from examining subordinate legislation.
It would be no bad thing if we imposed a healthy self-discipline on ourselves and legislated a little less. Then the Opposition could, as their part of the bargain, offer up some Supply Days as their part of this self-denying ordinance.
On behalf of the Government, therefore, I welcome the initiative of my hon. Friend in this matter. The House would do well to look carefully at his argument for change and at the constraints affecting such a change.

679
I personally have every sympathy with the argument my hon. Friend has put, and I know that my right hon. Friend the Leader of the House shares this sympathy. I can assure my hon. Friend that all the points he has made tonight will be carefully noted and considered by the Government.
I am only sorry that in order to raise these points my hon. Friend has had to sacrifice yet another evening with his
680
family, and in view of the hour he will not be able to go home and get in touch with them to let them know how the debate has gone. Perhaps it is some consolation for him to know that there is only one more week left in this parliamentary Session before he can return to Somerset, to his family and his constituents.
Question put and agreed to.
Adjourned accordingly at twenty-four minutes past Twelve o'clock.

SCOTLAND
  Scottish Special Housing Association
  Scottish Special Housing Association
  Historic Buildings (Edinburgh)
  Historic Buildings (Edinburgh)
  Government Offices (Dispersal)
  Government Offices (Dispersal)
  Forth Road Bridge
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FOREIGN AND COMMONWEALTH AFFAIRS
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  Royal Aircraft Establishment, Bedford
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EMPLOYMENT
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EDUCATION AND SCIENCE
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  Research and Development Expenditure
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HOME DEPARTMENT
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POSTS AND TELECOMMUNICATIONS
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SOCIAL SERVICES
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TRADE AND INDUSTRY
  Japan
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  Shipbuilding
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  Tyres
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  Post-Apollo Programme
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  Price Code
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WALES
  New General Hospital (Bangor)
  New General Hospital (Bangor)

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

THE LORD BISHOP OF LONDON
Gerald Alexander, Lord Bishop of London—Was (in the usual manner) introduced.

ELECTRIC VEHICLES
2.37 p.m.
LORD CLIFFORD OF CHUDLEIGH: 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, in view of the world shortage of energy and the pollution of the atmosphere by petrol and diesel fumes, they will encourage the production of the electric or part-electric car.
EARL FERRERS: My Lords, world oil supplies are expected to be adequate for a considerable time. Her Majesty's Government have supported research into the development of improved batteries, which are important for the construction of a practical electric car, and are continuing to examine promising alternatives. We have also financed the building of two electric buses which are now being tested in operation in city centres.
LORD CLIFFORD OF CHUDLEIGH: My Lords, I thank the noble Earl for that reply. Is it not a fact that the famous Mr. Healey—I refer to the engineer, not the politician—has recently announced that he is working on this project? Is there not also a prototype Waterbury electric car which is solar charged from the roof and electrically charged from crash barriers and from parking meters? Would it not be a great advantage for us to be able to develop something like this so that no longer need we be blackmailed
1136
by Colonel Gaddafi—or, for that matter, the Scottish Nationalists—and would not this car have been developed before but for the interests of the oil companies?
EARL FERRERS: My Lords, I quite agree with the noble Lord, Lord Clifford of Chudleigh, that if some electric car could be invented it would certainly have very great advantages. Much research has been done by different companies from time to time, but, so far as I understand it at the moment, it has been found impossible to find a suitable form of battery.
LORD DAVIES OF LEEK: My Lords, following the noble Earl's very encouraging reply, may I ask whether he is aware that one of the greatest contributions made to the lack of pollution and the cleanliness of the atmosphere in England is made by the local milkmen, some 50,000 of them, who drive their electric lorries or little tubs round Britain? Is the Minister further aware that in 1972, in an answer given in another place to Mr. Clark Hutchison, the Minister of State for Trade and Industry said that we were subsidising research into batteries to the tune of £160,000; and anent that supplementary answer may I ask whether we have increased that amount? When shall we cease to succumb to the pressure of the petrol interests? Edison said a century ago that there was a potential in the electric car and Berlin had 600 of them in 1902. Finally, is the Minister aware that a bus was running between Victoria and Charing Cross in 1902 and providing a good and a regular electric bus service?
EARL FERRERS: My Lords, the noble Lord, Lord Davies of Leek, has provided a fund of information, of some of which I was aware and some I was not. I agree that the electric milk float has very great advantages, but the trouble with batteries is that they need to be re-charged. That means that they have to be re-charged with electricity developed probably by the use of oil or some other means of generation. With regard to the subsidy to which the noble Lord referred, the amount paid out by the Department has increased over that sum.
VISCOUNT HANWORTH: My Lords, would not the noble Lord agree that with the existing batteries both the speed

1137
and endurance of most electric cars are inadequate for anything except city use?
EARL FERRERS: My Lords, that is one of the problems.
THE EARL OF LAUDERDALE: My Lords, would the noble Earl take this opportunity to repudiate the statement of the noble Lord, Lord Clifford, that there might be some sort of blackmail in the matter coming from Scotland?
EARL FERRERS: My Lords, when the noble Lord, Lord Clifford, comes to read what he said he may feel, in view of the number of people who come from the part of the world to which he referred, that he might have chosen slightly different words.
EARL HOWE: My Lords, is there any evidence to prove that the atmosphere is dangerously polluted by exhaust fumes, unless the exhaust pipe is turned and put through the window of the motor car?
EARL FERRERS: My Lords, there are certain regulations to prevent the pollution of the atmosphere from exhaust fumes, and there is also a voluntary agreement with industry to reduce the lead content in petrol to a maximum of 4·5 grammes per litre by the end of 1975.
LORD WALSTON: My Lords, the noble Earl mentioned in his first Answer that there was sufficient oil for a considerable period. Is he able to quantify that rather more exactly, and tell us what are the official estimates of the amount of fuel that is available, and for how long a period it will last?
EARL FERRERS: My Lords, I think the imminence of the physical shortage of oil should not be overstressed. The present known reserves in the world are sufficient for about 35 years' supply at the current rate of consumption.
LORD KINGS NORTON: My Lords, is the noble Earl aware that the prospects for the battery electric car are not very good and that there are electrical alternatives which are more promising? Is he further aware that it is possible to incorporate into a motorway a linear motor so that motor cars of the conventional kind, by the mere addition beneath them of a flat plate, could be carried along the motorway by mains power? Further,
1138
is he aware that this mains power would probably be generated in the future, which we now have to visualise, by nuclear energy?
EARL FERRERS: My Lords, I agree that as to the prospect of electrical cars, as we know them, they have had their problems and therefore are not as good as we should wish. We should like to see this possibility pursued, but the fact is that research has not yet found a way of overcoming some of the problems. The alternatives to which the noble Lord, Lord Kings Norton, has referred are certainly exciting possibilities, which I am sure will be pursued.
LORD SEGAL: My Lords, can the noble Earl give us an assurance that the Government have no intention of yielding to any political pressure from any quarter in order to ensure our adequate oil supplies in the future?
EARL FERRERS: My Lords, it is the Government's desire to ensure, so far as possible, that we have adequate oil supplies for the future. This is one of the reasons why we are prosecuting to the extent we are the findings in the North Sea.
LORD AIREDALE: My Lords, the Minister mentioned that electricity would be required for re-charging batteries. Would not most of this be done at night time, which would be a great advantage to the Generating Board, who would be able to spread the load?
EARL FERRERS: My Lords, that may well be a possibility. But the fact is that the electricity required to generate the batteries also has to be produced by hydrocarbons—
LORD KINGS NORTON: Nuclear energy.
EARL FERRERS: So if one is referring to pollution, there is still the same relative degree of pollution.
LORD SLATER: My Lords, is the noble Earl aware that he is to be highly complimented on the way he has answered the supplementary questions that have been asked? Would it not be a good idea for the three Parties to get together, to see whether we cannot fix a date for a debate and discussion on a matter of such great importance as

1139
this with the people who are supposed to have advanced knowledge on this subject?
EARL FERRERS: My Lords, we had a debate on the world energy situation some time ago. While the noble Lord, Lord Slater, may have a point about wishing this to be debated, the real problem is to try to find the answer to the research problems. At the moment that has not been possible.
LORD REA: My Lords, if investigations are to be made in this matter, would the noble Earl ensure that there is also taken into account the possibility of the steam car?
EARL FERRERS: My Lords, the steam engine went out a short while ago. I do not know whether the reintroduction of the steam car would prove very acceptable to most people.
LORD CROOK: My Lords, is the Minister able to say whether fuel cell investigation is taking place as part of the research?
EARL FERRERS: My Lords, there are many companies involved in research in this particular field.

CHELMSFORD A.12 BY-PASS ROUTE
2.46 p.m.
LORD IRONSIDE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they agree with the precipitate decision of the Essex County Council Highways and Planning Committee in selecting the Northern route for the proposed Chelmsford A.12 By-pass; and, in view of the importance attached by the Department of the Environment to the method by which such planning decisions are reached, whether the reasons for Essex County Council's decision can be made publicly known and subjected to proper public scrutiny.
LORD MOWBRAY AND STOURTON: My Lords, the decision on the route of the A.12 Chelmsford By-pass will be a matter for my right honourable friend the Secretary of State for the Environ-
1140
meat. In accordance with the new arrangements for consulting the public at an early stage in road planning, members of the public were asked to state a preference for one of three routes. The Essex County Council expressed a preference for the Northern route. It is for the county council to decide whether to make public the reasons for their choice.
LORD IRONSIDE: My Lords, I thank my noble friend for that Answer; but is he aware that I live in the area and that there is widespread objection to the Northern route from the rural district council, from the borough council and from the three action groups? In fact, one might say that this route has no friend in the world except the Essex County Council. Is my noble friend further aware that intense interest is being taken in the planning of this by-pass, particularly from the point of view of the new planning procedures, and that Chelmsford is here being used as an experiment? Would he not agree therefore that if a proper judgment is to be made by the local community it is important for the county council to make known their reasons for the selection of the Northern route?
LORD MOWBRAY AND STOURTON: My Lords, I take my noble friend's point. In fact, in this particular case the Essex County Council are not the planning authority. They are just one of the local authorities who have given their views, as others have been asked to do. Thirteen thousand completed questionnaires have been received, and when my right honourable friend makes his announcement in due course he will no doubt indicate which way they favoured.
LORD IRONSIDE: My Lords, may I further ask my noble friend whether he knows when the Secretary of State expects to lay a draft proposal under the Highways Act?
LORD MOWBRAY AND STOURTON: My Lords, I cannot give my noble friend an exact date. My right honourable friend is studying the data received from local authorities and amenity bodies, and in the course of the summer he will be announcing his decision. Of course, if there are substantial objections an inquiry will be held.
LORD BURTON: My Lords, is my noble friend aware that planning procedures already proceeding on the A.12 by-pass are grossly in excess of what we are allowed for any trunk road in Scotland? Would he advise the Ministers concerned that we should like to increase the planning procedures in Scotland too?
LORD MOWBRAY AND STOURTON: My Lords, I am sure my right honourable friend the Secretary of State for Scotland will take notice of my noble friend's question.
LORD PARGITER: My Lords, can the noble Lord say how many major routes have been approved without objection?
LORD MOWBRAY AND STOURTON: My Lords, I think that is a little wide of the Question on the Order Paper, and I should need notice of it.

EX-SERVICEMEN'S WIDOWS' PENSIONS
2.49 p.m.
LORD SHINWELL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what representations have been made by widows of ex-Servicemen, or on their behalf, for increased pensions; how many have applied for supplementary allowances; the number in receipt of such allowances; and the average amount paid.
THE MINISTER OF STATE, DEPARTMENT OF HEALTH AND SOCIAL SECURITY (LORD ABERDARE): A number of representations have been received from both individual war widows and ex-Service organisations by my Department and by the Ministry of Defence. In November, 1972, 11,600 of the 100,000 war widow pensioners were in receipt of supplementary benefit. The average amount in payment was £2.32 a week.
LORD SHINWELL: My Lords, if it be considered desirable to provide a reasonable pension for those widows who were bereaved as a result of recent conflict, for example, in Ulster, why
1142
should not widows who were bereaved as a result of the Second World War, Aden and other conflicts be assured of a similar pension?
LORD ABERDARE: My Lords, there are two separate issues involved. One is the ex-Serviceman's pension, which is administered mostly by my Department and which also covers war widows; and the other issue is covered by the schemes run by the Ministry of Defence, one of which is the special scheme which applies to Northern Ireland and which the noble Lord has mentioned.
LORD SHINWELL: My Lords, is the noble Lord aware that the fact that this very difficult matter is being administered by two separate Departments calls for immediate co-ordination? A reasonable pension should be given. Can the noble Lord, Lord Aberdare, explain why this anomaly should continue?
LORD ABERDARE: My Lords, it is not an anomaly. This has always been the practice. One scheme is the basic scheme, rather like the National Insurance basic scheme which is run by my Department. Over and above that there are special schemes, for example, the new occupational schemes of the Ministry of Defence, which give additional benefit to people who are now serving on better terms of service than originally applied.
LORD SHINWELL: My Lords, would the noble Lord say quite categorically that those widows who were bereaved as a result of what happened in the Second World War and in Aden, and so on, are receiving as reasonable and decent a benefit by way of pension as those widows who were bereaved as the result of other conflicts?
LORD ABERDARE: No, my Lords, they are not, because there are widows whose husbands were killed while serving in the First World War, and those men were serving on different terms of service. The fact is that they are treated considerably better; all Governments have treated them considerably better than they would be treated under the normal National Insurance scheme. They have considerable preferences over the widow in the National Insurance scheme. But there have recently been introduced improved terms of service by which people who are now serving are gaining

1143
the benefit. This is exactly what happens in any other walk of life when a new pension scheme is introduced.
BARONESS WOOTTON OF ABINGER: My Lords, when the Minister says that this has been the rule for a very long time, is he implying that if an anomaly goes on long enough it ceases to be anomalous?
LORD ABERDARE: My Lords, this is not an anomaly.
LORD MAYBRAY-KING: My Lords, is the noble Lord, whose work in this field many of us admire, aware that every ex-Servicemen's association— AJAX, BLESMA, FEPOW, and the great Legion itself places first on its agenda at every annual conference the special claims of, the women who gave their husbands that we might be free?—that we recognise what the Minister has done, but that we hope he will still bear in mind the special claim of the widows of ex-Servicemen?
LORD ABERDARE: Indeed, I will, my Lords. I thank the noble Lord for the kind references he made to myself and my Department. It is a fact that war widows do receive very special treatment, not only in respect of their basic pension but also in regard to special allowances; and they also benefit from a special disregard in respect to supplementary benefit. All this will continue and is continuing under the new Bill which uprates the various allowances.
LORD SHINWELL: My Lords, I feel I must pursue the matter a little further. I apologise for doing so, but this is an extremely important matter. In view of what the noble Lord has now stated—that the widows of those bereaved as a result of previous conflicts are not as well off, because of some technical difficulty or financial problem, as those who were bereaved in recent conflicts—may I ask the noble Lord to give an assurance that the Government will reconsider this matter at a later stage—perhaps soon after we resume in October? Would he give me an assurance that he will be able to inform your Lordships' House at that time that the matter has been settled in a more reasonable fashion?
LORD ABERDARE: No, my Lords; I regret that I cannot give the noble Lord that undertaking. This is a completely new scheme—an occupational pension scheme of the Ministry of Defence—and it applies to those who are currently serving in Her Majesty's Forces. It cannot be retrospective in its application.
LORD WIGG: My Lords, is it not a fact that all Governments have treated with generosity the dependants of the soldiers who lost their lives in the First and Second World Wars, whereas the dependants of the ex-Servicemen who receive benefits under the Royal Warrant —and indeed the ex-Servicemen themselves—are heirs to quite a different tradition? In the first case the recipients receive their pensions under statutory authority, while others, like myself, my stepfather and my mother, receive our pensions by grace and favour—and there is pretty little grace and not very much favour.
LORD ABERDARE: My Lords, I am afraid that that only underlines what I have been trying to say to the noble Lord, Lord Shinwell: that people serve in Her Majesty's Forces under different conditions of service.
LORD WIGG: But, my Lords, is it not about time that the Government (I am not saying that the Conservative Government have been more mean than others but they have not been more generous) looked retrospectively, perhaps as far back as the South African War, and to those who enlisted before the First World War, and treated them with the same generosity as those who had the good fortune to be born some years later?
LORD ABERDARE: My Lords, the normal schemes run by my Department are generous and are uprated at regular intervals.
LORD CHALFONT: My Lords, is it not true that in fact the reason why this pension scheme cannot be made, as the noble Lord, said, retrospective—though that is a rather crude way of describing it—is entirely a matter of financial restriction; in other words, of not having enough money? Would it not be wiser for the noble Lord to say so? And would he also say why—and it seems to me extraordinary—he cannot assure my noble

1145
friend that at least the Government will look into this? Because, whatever the noble Lord may say, there seems to be a great anomaly here in that the dependants of those killed in previous wars are treated less generously than those who are serving now. This is an anomaly which should be put right. Would not the noble Lord assure the House that the Government will at least look into this?
LORD ABERDARE: My Lords, I do not agree with the noble Lord that this is an anomaly; nor is it only a matter of finance. Certainly there is a very large sum of money involved, but the fact of the matter is that it would set an entire precedent for every other large pension scheme. When you have a pension scheme, it is only those people who are enrolled in that scheme who stand to gain by its benefits. That applies to the schemes of the Civil Service and to various other large schemes, where you could not take into account all those people who have already retired on different conditions of service.
LORD WIGG: My Lords, would the noble Lord bear in mind that many Governments—and certainly this applies to the first Labour Government before they assumed Office—gave an undertaking on one simple point: that for those of us who had the good fortune to have had lengthy "other rank" service and were subsequently commissioned, that "other rank" service should count for pension? I must declare an interest. I happen to be one of the victims, as were my forbears; but there are many others who are worse off than I am; and there are many widows who are worse off, for just the reason that the noble Lord, Lord Chalfont, mentioned, and are treated in this scandalous way.
LORD ABERDARE: My Lords, if the noble Lord, Lord Wigg, would send me details of his case, I will certainly look into it.

BUSINESS
LORD DENHAM: My Lords, with the leave of the House, my noble friend Earl Ferrers will be making a statement on the recent meeting of the Council of Ministers at a convenient moment after 3.30 p.m.
ABERDEEN CORPORATION 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.
DUNDEE CORPORATION (BROKERS &c.) 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.
NATIONAL TRUST FOR SCOTLAND 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.
CROMARTY FIRTH PORT AUTHORITY CONFIRMATION BILL
Read 3a, and passed.
ULLAPOOL PIER ORDER CONFIRMATION BILL
Read 3a, and passed.
GLASGOW CORPORATION (PARKS ETC.) ORDER CONFIRMATION BILL
Read 3a, and passed.
DEE AND CLWYD AUTHORITY BILL
Read 3a, and passed.

LAND COMPENSATION (SCOTLAND) BILL [H.L.]
3.2 p.m.
THE MINISTER OF STATE, SCOTTISH OFFICE (LORD POLWARTH): My Lords, before the House decides to discharge the Order of Re-commitment, if it does so decide, I should inform the House that this is a Bill to re-enact, in the form in which they apply to Scotland, the provisions of the Land Compensation Act 1973. Following a Resolution of this House on May 22, 1973, which was agreed to by the other place, this Bill was referred to the Joint Committee on Consolidation Bills. They have reported that the Bill represents the existing law as contained in the Land Compensation Act of this Session, and that it does no more than reproduce the provisions of that Act in the form in which they apply to Scotland. They are of the opinion that there is no point to which the attention of Parliament should be drawn. This Bill was not amended by the Joint Committee on Consolidation Bills. I understand that no further Amendments have been put down to this Bill and that no noble Lord has indicated a wish to move a manuscript Amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the Order of Re-commitment be discharged.
Moved, That the Order of Re-commitment be discharged.—(Lord Polwarth.)
On Question, Motion agreed to.
Then, Standing Order No. 44 having been suspended (pursuant to the Resolution of July 12):
LORD POLWARTH: My Lords, I beg to move that the Land Compensation (Scotland) Bill be now read a third time.
Mover, That the Bill be now read 3a.—(Lord Polwarth.)
THE LORD CHANCELLOR (LORD HAILSHAM OF SAINT MARYLEBONE): The Question is, That the said Bill be now read a third time. My Lords, I heard a noble Lord say, "Committee, Committee!" and I am bound to say that in the form in which it is shown upon my Order Paper the item on the Local Government (Scotland) Bill appears as "House to be again in Committee". If that is right, the appropriate Motion
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would be to move, "That the House do again resolve itself into Committee on this Bill". I am wondering whether my noble friend could elucidate the position, because some of the Members of the House are in some doubt as to where they stand.
LORD HUGHES: My Lords, surely the Order of Re-commitment has been discharged.
LORD POLWARTH: My Lords, we are still discussing the Land Compensation (Scotland) Bill, and, the Order for Re-commitment having been discharged, I am moving that the Bill be now read a third time.
THE LORD CHANCELLOR: My Lords, I apologise to my noble friend; I was misled by a voice on my left.
On Question, Bill read 3a.
LORD POLWARTH: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill do now pass.—(Lord Polwarth.)
On Question, Bill passed, and sent to the Commons.

LOCAL GOVERNMENT (SCOTLAND) BILL
3.4 p.m.
LORD POLWARTH: My Lords, I beg to move that the House do again resolve itself into Committee on this Bill.
Moved, that the House do again resolve itself into Committee.—(Lord Polwarth.)
LORD SHINWELL: My Lords, in view of the confusion that has been exhibited on the Government Front Bench, may I ask whether this is not a classic example of the need for home rule for Scotland? Does it not occur to the Ministers on the Government Front Bench that if the noble Lord, Lord Polwarth, left your Lordships' House at the present moment and went post-haste to Edinburgh, to St. Andrew's House, and tried to remove the confusion, it would help your Lordships' House to get on with more important business?
LORD POLWARTH: My Lords, if I accepted the noble Lord's suggestion, I should certainly invite him to come and join the party.
LORD HUGHES: My Lords, three-quarters of the Front Bench at present are Scots. Secondly, I can imagine no more important business before this House than Scottish business.
On Question, Motion agreed to.
House in Committee accordingly.
[The EARL OF LISTOWEL in the Chair.]
Schedule 3 [Amendmentand Modification of Election Law]:
THE EARL OF BALFOUR: Sections 113 and 117 of the Representation of the People Act 1949 concern local elections. Therefore I am moving that for the word "county" in one case there should be substituted "island or district", and in the other case, "district or island". I beg to move Amendment No. 46.
Amendment moved—
Page 158, line 35 at end insert—
("in section 113(3) (Presentation of petition questioning local election) in subparagraph (b) for the word "county" there shall be substituted "island or district".
In section 117(1) (constitution of election court in Scotland) for the word "county" there shall be substituted the words "district or island". ").—(The Earl of Balfour).
THE MINISTER WITHOUT PORTFOLIO (LORD DRUMALBYN): I can reassure my noble friend on this matter. Provision is made in the 1971 Act for the interpretation of the word "county" in relation to sheriffs; and with that assurance my noble friend may be prepared to withdraw his Amendment. However, my noble friend may also like to know that there is a possibility that some local authority areas may be contained partly in one sheriffdom and partly in another. In this situation there would be a question as to which sheriff would have jurisdiction in relation to elections in the local authority concerned. This point is being considered and, if necessary, an Amendment will be brought forward at the Report stage.
THE EARL OF BALFOUR: With that assurance, I should like the leave of the Committee to withdraw the Amendment.
Amendment, by leave, withdrawn.
THE EARL OF BALFOUR: I consider that this is a drafting matter. It is either necessary or unnecessary. In my opinion,
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certainly the date 1947 can no longer be appropriate. I beg to move Amendment No. 47.
Amendment moved—
Page 158, line 38, at end insert:
("13. In section 166 (Local elections in Scotland excluded form Parts II and III of Act), for the date "1947" there shall be substituted the date 1973".")—(The Earl of Balfour.)
LORD DRUNIALBYN: I am happy to agree with my noble friend and to accept the Amendment.
On Question, Amendment agreed to.
Schedule 3, as amended, agreed to.
Clause 12 agreed to.
Schedule 4 agreed to.
Clauses 13 to 15 agreed to.
Clause 16 [Substantive changes in electoral arrangements]:
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 49:
Page 9, line 16, at end insert:
(" (4) It shall be the duty of the Council of each district or island area to keep under review the electoral boundaries of their wards and report to the Boundary Commission any substantive changes in the electorate or other matters concerning the representation of the people.")
The noble Earl said: May I briefly speak to both Amendment No. 49 and the next Amendment standing in my name, in Clause 18, No. 50? I put down these Amendments to draw attention to the fact that the review of boundaries and wards need to be carried out; and I felt, if the council of each district did not keep these matters under review, who else would? Also, I felt that the Secretary of State, on any representation made to him, should be in a position to invite the Commission to look into the matter properly. The problem here is that people, even within one district, can move from one area to another and thereby upset the ward or the election areas. I beg to move.
LORD HUGHES: I am not certain whether it will be necessary to have a provision in the Bill to give effect to this proposal, but certainly what the noble Earl is asking for is desirable. The Boundary Commission in relation to local government is a new procedure and it may well

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be that unless local authorities' attention is drawn to the fact that this remains a matter on which they should continue to interest themselves, some of them, at any rate, may assume that they do not have to do anything; that they just have to wait for the Boundary Commission to act. It may be that the Boundary Commission will have its own sources of information and get it just as readily as it would do if the local authorities notified it. But I agree with the noble Earl that the most likely body to be first aware of a need for change is the local authority. Presumably, however, it will always be open to anyone else to suggest to the Boundary Commission a need for change; for example (and I say this in fear and trembling because of what the noble Lord, Lord Burton, may say), even the political Parties may be able to draw the Boundary Commission's attention to a matter of this kind.
LORD DRUMALBYN: The noble Lord, Lord Hughes, is quite right on this; we do not think this Amendment is necessary. But we think that the local authorities will certainly keep these matters under review, and in any case, as Lord Hughes says, in Clause 14(3) the words are:
"If the Boundary Commission receive a request from a local authority or from any person that they should conduct a review under subsection (2) above with respect to any local government area in which the authority or person appears to the Commission to have an interest, the Commission shall consider the request."
The preceding clause gives the Boundary Commission the right at any time to:
"review all or any part of the local government areas".
So that is the body which has to keep the local government areas under review. But obviously the local authorities themselves will be taking a constant interest in this matter, such is the nature of local government, and if they request the Boundary Commission to make a review, then the Commission is bound to consider the request. So this Amendment is unnecessary.
THE EARL OF BALFOUR: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 16 agreed to.
Clauses 17 to 20 agreed to.
Schedule 5 agreed to.
Clauses 21 and 22 agreed to.
Clause 23 [Change of name of region, islands area or district]:
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 52:
Page 12, line 20, after ("proceedings") insert ("or arbitration").
The noble Earl said: Here we have in Clause 23(3), at line 20, the expression:
"or render defective any legal proceedings".
I have suggested that we should insert the words, "or arbitration". In many casesterms of leases, contracts and various such things—because often it is an easier and cheaper way of settling any dispute, the words "or arbitration" are used. The term used might be:
"In case of a dispute between the local authorities, or whoever it may be, the matter shall be settled by arbitration".
I have attempted to seek legal advice as to whether the term "legal proceedings" would cover arbitration, and I was rather led to the impression that it would not. Hence the reason for my Amendment. I beg to move.
LORD DRUNLALBYN: We are here talking about the consequences of a change of name of an authority. The subsection reads:
"A change of name made in pursuance of this section shall not affect any tights or obligations of any council, authority or person, or render defective any legal proceedings".
My noble friend is seeking to add the words "or arbitration". In its ordinary sense the expression "legal proceedings" does not include arbitration, but there are instances in Statute where express provision is made so that it is deemed to include arbitration—for example, the Bankers' Books Evidence Act 1879. But the essence of arbitration is the agreement of the parties to go to arbitration. It is best, therefore, that in this area of arbitration, which is governed by agreement and not by Statute, there should be the minimum of statutory interference and the effect of any change of name should be left to be dealt with by the parties them- selves. The use of the expression "legal proceedings" in the subsection is primarily to cover proceedings before the courts where more formal rules and procedures apply and there is no question

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of the agreement of parties. A change of name here could lead to delay and expense, and even dismissal of the action in certain cases, and it is this situation that the subsection is really providing for. Having said that, I am prepared to look at this matter further, if my noble friend will withdraw the Amendment, to make quite certain that the interests of the existing authorities and their successors will be in no way prejudiced.
THE EARL OF BALFOUR: I am most grateful for that highly technical reply and am happy to ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
3.20 p.m.
LORD HUGHES LORD HUGHES moved Amendment No. 54:
Page 12, line 24, leave out ("before 16th May 1980").
The noble Lord said: Subsection (4) of Clause 23 reads:
"The name of a region, islands area or district shall not be changed under this section before 16th May 1980 unless the change is made with the consent of the Secretary of State".
I can understand the reasons for putting in a date. The declared view of the Government on this and on other matters has been to give the maximum amount of freedom to local authorities to make their own decisions in matters of their own business, and that is a point of view with which I heartily concur. However, I think the change of name of an authority can affect a great deal more than just their own business. It can cause complications in relation to what people outside know, what they think of an area, and at a time when most local authorities in Scotland concern themselves very much with trying to attract industry into their area it is important that outside people should know exactly with whom they are dealing. We have too much trouble as it stands, even with long established and well known names, with the amount of remarkable ignorance of the situation which exists.
Not so many years ago I attended an exhibition arranged by the Hydro Board in Birmingham. This was at the time, if I remember rightly, when the noble Lord, Lord Strathclyde, was chairman of the Board. An industrialist there who was contemplating coming to Scotland
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said he had just learned that some remote ancestors of his came from Aberdeen and therefore he thought he might be in-interested in going there, but before doing so he would wish to be assured that Aberdeen possessed an electricity supply and running water. If one can have that sort of misunderstanding about a name which has become famous, if in nothing else at least in story—funny story in particular—what will be the position if there are to be frequent changes of names of local authorities? We heard a good deal about this yesterday when some names, perhaps well known in ancient history but not so well known at the present time, were queried, and in one case at least a change was made.
So while generally I should be reluctant to say that the local authority should act only with the consent of the Secretary of State, I think this is a case where the Secretary of State might retain a power and not just have it for a limited period. I am quite certain that if there are good reasons for a change it will be a formality; the Secretary of State will not withhold his consent. But there could be circumstances in which a change was made for reasons which were good neither for the local authority itself nor for other people concerned. Therefore, in those circumstances I think it would be better that the position should be safeguarded and that an outside, unbiased party should have a right to say "Yea", or "Nay". I beg to move.
LORD BALERNO: I rise to support the noble Lord. Lord Hughes, in this Amendment. A change of name can affect not just the district or region which changes its name but the adjacent districts or regions. There is a wider implication here and I trust that the Government will give sympathetic consideration to this Amendment.
LORD DRUMALBYN: I entirely agree with the noble Lord, Lord Hughes, that it is a serious matter to change the name, and I think he is perfectly right—and also my noble friend, Lord Balerno—in saying that a change of name affects people outside the area concerned, although I believe it is equally right to say that the people who stand to lose most by a change of name are the inhabitants themselves. There are any number of things which are affected—maps, books of reference and all the rest of it. I should have

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thought that this was something that everyone concerned would take into account and that there would not be a tendency to change names frivolously (if I may put it that way) with each change of régime in a local authority.
The reason why the date of May 16 has been put in is because once the matter has been fully discussed, as it was before the Bill was introduced, and once Parliament has considered the matter, it seems that it would be only right that the Secretary of State should have a chance to express a view on a proposed change of name, and indeed even to prevent it if he thought it was inappropriate. That is the reason why it is being done in what might be termed the launching period of the new régime. But, given the fact that it is so obviously important to the inhabitants of the area themselves, we thought this was something which could safely be left to the local authorities. After ail, we are extending their powers of decision very widely indeed in this Bill and we thought that this was among those items where we could afford to leave it to the local authorities concerned.
My own personal view is that if a name is to be changed at all it ought to be changed pretty quickly at a time when we are changing names in general and before it gets into the maps and books of reference. But there is the safeguard of the Secretary of State, for the reasons I have given. I hope the noble Lord will agree that after that date, and simply because it will be obvious to everyone that if they are going to change the name they should change it quickly, a control will be unnecessary. After all, in the past names have not been changed without a good reason for so doing, and that is why we provided this initial period of five years during which the Secretary of State should exercise oversight of changes of name.
THE EARL OF SELKIRK: I must confess that I rather agree with the noble Lord, Lord Hughes, on this subject. I do not think it is likely to happen often, but I can conceive of a name becoming
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a sort of political football, and that would be a great pity. I should have thought that the submission of a series of names to the Secretary of State would be a formal matter but it would discourage the frequent changing of names. May I mention one point which came out yesterday? There is sometimes a name which is popular locally, but the point of a name is much wider, and sometimes the local authority might not realise the wider significance of changing the name. I hope the noble Lord will give this matter further consideration.
LORD HUGHES: May I ask the noble Lord what the present position is? Are existing local authorities able to change the name off-hand? I know that it happens only seldom. The last one of which I am aware was in my own part of the world when, many years ago, the county of Forfarshire became the county of Angus. Can the noble Lord say what the present position is?
LORD DRUMALBYN: I think the answer is that they are not able to, but I am not sure of that without getting confirmation. I see that I am right; they cannot change the name without the consent of the Secretary of State. I should like to think of this proposal further in the light of what the noble Lord has said. As I have said, we are relaxing controls in many ways and we should like to consider whether this is an appropriate way in which to relax the control or not. I would point out that there is the safeguard of the Amendment made on the Report stage in the Commons which requires a resolution for a change of name to be passed by a majority of the whole council, not just a majority of those present. Even so, I shall be happy to reconsider the matter.
LORD HUGHES: That is as far as I can expect the noble Lord to go on this occasion. I therefore beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 23 agreed to.
Clauses 24 to 28 agreed to.
Schedule 6 agreed to.
Clause 29 [Qualifications for nomination, election and holding office as member of local authority]:
3.31 p.m.
THE EARL OF SELKIRK THE EARL OF SELKIRK moved Amendment No. 55:
Page 15, line 39, at end insert ("and has been resident in the United Kingdom for twelve months.")
The noble Earl said: Clause 29 deals with what I call the geographical qualifications, to enable anyone to stand for a local authority. I should like to draw attention particularly to subsection (1)(a). The rule, as it stands, is that anyone can stand for a local authority provided he has one of four qualifications: he can be on the electoral roll; he can have lived in his own property for 12 months; he can have worked for 12 months, or he can, during the whole of that period of 12 months, have lived in the authority's area. The first qualification is of a very different character from the others. I am not quite certain how one gets on the electoral roll, but I rather think that if one stays fora fortnight in October in almost any place, one would probably get on the roll. That is a very different proposition from the other three qualifications.
It might well be argued that the other three propositions are too restrictive. I am rather inclined to think that it is not too restrictive, but it is open to doubt. If it is not too restrictive, then I think paragraph (a) is too open if it means that any British subject—and I believe "British subject" means anyone who is a citizen of any part of the Commonwealth—can come into a local authority, be registered in October, and then is entitled, so far as I know, so long as he keeps that registration, to stand forthwith for the local authority. I am doing no more at this stage than moving a probing Amendment. I should have thought that if this is to stand in line with the other three restrictions there should be an additional qualification. Possibly one should say that he should be on the electoral role for 12 months, but I would suggest, if I may, that the Government should look at this again. I think the mere extending of the electoral role to someone who in fairness may have been in this country for only three months is a little too wide if the other three qualifications are considered
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necessary. Would the noble Lord look at the question to see whether it should stand exactly as it is? I beg to move.
LORD DRUMALBYN: As usual there is some force in what my noble friend says, but before I take it away to look at it, I ought to state at any rate the arguments that exist for maintaining the law as at present because this clause reproduces the existing law on qualifications for election which are at present set out in Section 50 of the Local Government (Scotland) Act 1947, as amended by the Local Authorities (Qualification of Members) Act 1971. So in a sense this has been looked at fairly recently. But that is no reason why it should not be looked at again.
As my noble friend says, it is the case that a British subject, or a citizen of the Irish Republic arriving in an area on or about the qualifying date for the register, which is October 10, could get on the register if the general circumstances of his stay satisfy the registration officer that he was resident in the area. As my noble friend knows, the register is compiled with regard to the circumstances at October 10, but not published until the following February. Under Clause 8 of the Bill, local authority elections in Scotland will be held on the first Tuesday in May, so candidates standing at these elections qualifying by being on the register of electors will have been resident in the area for at least seven months.
THE EARL OF SELKIRK: If I may interrupt the noble Lord, he may have left the area and still be on the register. That is my point.
LORD DRUMALBYN: I take note of my noble friend's point, but if he has left the area he might have considerable difficulty in getting the people to sign his nomination papers and to put him forward. I think one has to bear in mind that a candidate cannot simply decide for himself that he should stand at an election. He will have to be nominated by local government electors for the electoral division or ward for which he wishes to stand. The restriction proposed by the Amendment is not one which applies for nomination for an election to another place. The restriction imported by the Amendment could debar an able candidate from standing in circumstances in which it would be

1159
obviously desirable that he should stand. For example, one would not have to look far round this Chamber to see people who might have been minded to stand for election to a local authority shortly after their return from holding distinguished office abroad. If they had strong connections with the locality, the mere fact that they had worked abroad would not deter them from doing so, and on return to the locality they could offer experience valuable to the council of the area concerned. My father did this on retiring from the Indian Civil Service. So these are matters one has to weigh in the balance in reaching a decision on this.
It is the Government's view that this matter can be left to the good sense of the electors in subscribing to nomination papers of the candidates and recording their votes in the ballot box. With respect I do not think my noble friend's arguments outweigh the argument that I have put forward.
THE EARL OF SELKIRK: I do not propose to press this Amendment, but if it is left to the good sense of the electors you do not need (b), (c) or (d). If you have those three paragraphs the good sense of the electors is superseded. In these circumstances, however, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
3.38 p.m.
LORD BURTON LORD BURTON moved Amendment No. 56:
Page 16, line 3, after ("land") insert ("with a value of not less than £10").
The noble Lord said: When I first stood for the county council 24 years ago, I remember that I had to become a tenant of a piece of ground to a value of no less than £10 to allow me to qualify. Since then there has been another Act which has dropped this qualification from the Local Government (Scotland) Act. I do not mind if it is £10 or any other figure, but I feel that there should be a minimum qualification. After all, as we stand at present, someone could just pay a peppercorn rent or 1p for a piece of land to allow him to qualify. Somewhere there should be a minimum qualification. I beg to move.
LORD HOY: While I am very interested in the Amendment, I must say that I do
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not think it is very clear. I do not think that the noble Lord made it any clearer in the course of his short introduction, for which I commend him. What does he mean by £10? Is this a value, a rateable value or rent? The Amendment just says, "to the value of £10", but does not explain what is meant by "£10". If it is an annual value, a rateable value, one can measure it, but if it is the selling price of land, one would not get much land for £10—you could carry it away in your window box. Before we discuss the Amendment any further, could the noble Lord explain what he means by £10?
LORD BURTON: I would agree with what the noble Lord, Lord Hoy, has said, that perhaps it is not very clear. I do not really mind what the figure is or how it is valued, but the principle I have in mind is that there should be a minimum value for a tenancy or for an ownership of a piece of ground. It is ridiculous that one may be able to pay perhaps a peppercorn rent and still qualify. If the Minister would look at this he might even put an Amendment down to put it right at Report stage.
LORD POLWARTH: My Lords, in order that the House may hear the statement of the E.E.C. Council of Ministers I beg to move that the House do now resume.
House resumed.

ROYAL ASSENT
3.41 p.m.
THE LORD CHANCELLOR: My Lords, before my noble friend makes his Statement I have to notify the House in accordance with the Royal Assent Act that the Queen has signified her Royal Assent to the following Acts:

Protection of Wrecks Act,

Ulster Defence Regiment Act,

Employment Agencies Act,

Northern Ireland Constitution Act,

Water Act,

Social Security Act,

Statute Law (Repeals) Act,

Ullapool Pier Order Confirmation Act,

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Cromarty Firth Port Authority Order Confirmation Act,

Glasgow Corporation (Parks &c.) Order Confirmation Act,

Ryde Corporation Act,

Southampton Corporation Act,

City of London (Various Powers) Act,

Medway Ports Authority Act,

Queen Mary College Act,

Rhondda Corporation Act,

Salford Corporation Act.

E.E.C.: AGRICULTURAL MINISTERS' MEETING
3.42 p.m.
EARL FERRERS: My Lords, with the leave of the House I should like to repeat a Statement which is being made in another place by my right honourable friend the Minister of Agriculture on the meeting of the Council of Agricultural Ministers in Brussels this week. The Statement is as follows:
"The main subjects discussed were sugar, beef and the problem of protein for animal feed arising from United States controls on exports of soya beans.
"There were two issues concerning sugar before the Council. The first related to the subvention to United Kingdom sugar refiners which I announced to the House on March 28, and which is designed to enable us to continue refining Commonwealth Sugar on the same basis as before. The European Commission had warned us that they might have to take the view that this arrangement was incompatible with the Treaty of Rome. I received notification yesterday that the Commission was of that opinion, and so I immediately raised the issue in the Council of Ministers. I explained the importance of this subvention to the honouring of our Commonwealth commitments, and I am happy to tell the House that the Council immediately and unanimously decided to authorise its continuation for the next 12 months.
"The second issue related to the arrangements for sugar from 1975, with the three interrelated aspects of continued imports from the developing
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Commonwealth, the European Economic Community's membership of the International Sugar Agreement and the future arrangements for sugar beet in Europe. The Commission tabled farreaching proposals on all these aspects. Obviously they will require detailed study, but I should like to call attention now to three points. First, they provide for the continued import of the full 1·4 million tons a year from the developing Commonwealth, and so are intended to honour the Lancaster House assurances in letter and in spirit. Secondly, they would enable the Community to participate very constructively in the resumed negotiation for a new International Sugar Agreement. Thirdly, they should provide scope for us to secure a justified increase in British beet sugar production as the Australian quota is phased out. I am glad to say that, although obviously all wanted a chance to study these proposals further, the will to honour the commitment to continue to import 1·4 million tons was evident in the initial comments of most Ministers.
"The Council also discussed the reduction in cattle prices which has taken place recently. It was decided that import duties which are at present suspended should be restored if the average Community market price falls below 103 per cent. of the guide price for one week. The effect on United Kingdom retail prices should be marginally beneficial, since although we should have to reintroduce import charges these would be offset at the current value of the pound by the application of monetary compensatory amounts as subsidies on our imports. Exports from the Irish Republic both as stores and as fat animals which have recently been attracted away from their traditional outlet in the United Kingdom will be likely to revert to this country.
"On protein feedingstuffs, the Council decided to put in hand the consideration of the possible diversion from intervention stocks of 50,000 tons of dried skim milk for use in pig and poultry feed between now and the end of the year if the need should arise, and also the possibility of expanding protein production in the Community. These matters will be considered further

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in the light of the outcome of the visit which the Agricultural Commissioner, Mr. Lardinois, is to pay to Washington this week and in the light of the protein supplies likely to be available from the U.S.A. and Canada.
"I also raised briefly the question of welfare of animals in transport and at slaughterhouses. The matter is to be discussed now at official level and will be on the agenda of the Council for further discussion in September."
My Lords, that concludes the Statement.
LORD HOY: My Lords, we are grateful to the noble Earl for repeating the Statement made by the right honourable gentleman the Minister of Agriculture in another place. May I ask the Government what steps the Minister is going to take regarding transport of live animals? After all, he is faced with the position created in another place which so overwhelmingly told the Government that there must be no more export of live animals. How do the Government propose to undertake this task? One has also to take into account the importance of this section of the industry so far as agriculture is concerned, so that we should be grateful to hear what proposals the Minister has to place before the other Ministers when they meet in September.
On the subject of the difference in cattle prices, I wonder if the Minister could say whether these falls have been reflected in the purchasing power of housewives at home. Have they been reflected in the shops? This is where the importance of any reduction will be appreciated. Secondly, I should like to know why the Minister thinks that, merely by changing the form of compensation that is proposed, more cattle, either store or fat, will be diverted from Southern Ireland to this country. How does he think that this simple change will allow this to take place? Since the figures we have of imports from Southern Ireland are fairly well established under the Anglo-Irish Treaty and the Irish Agreement, the House would also like to know, I think, whether in fact they do meet that commitment in this respect.
Most important, of course, is the question of the Sugar Agreement. I must say
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that the Minister's account of it appears to be quite cheerful, but if one cares to read the official reports of the meeting the position is not quite as the Minister has put it in his Statement. First of all, the Minister quoted the date on which we debated the Sugar Agreement, March 28; and the House was then assured that the position of the Commonwealth sugar producers had been totally safeguarded. Now we hear that the Commission have intimated—not only did they intimate but they told the Minister pretty firmly—that what Britain was doing was in fact a contravention of Article 92 of the Treaty of Rome. Having had this unanimously agreed to, we then had to adopt another tactic, as I understand it. And is it not a fact that when we went to the Committee of Ministers we were appealing against a decision arrived at by the Commission? While the Ministers have agreed to give us the waiver, it is a waiver that will last only for 12 months. Surely this cannot give any great assurance to the Commonwealth sugar producers, because they cannot continue the practice of producing sugar on a year-to-year basis. They understood when the first Agreement was reached that they had an assurance for practically all time. Can the Minister tell us what is proposed in order to put the Commonwealth sugar producer back to where he thought he was when the first Agreement was made in March of this year?
LORD WADE: My Lords, I should like to join in thanking the noble Earl for repeating this Statement, but would also ask him whether he can give a little further clarification on the subject of the timetable. I certainly welcome the announcement that the commitments of Her Majesty's Government to the Commonwealth countries will not be inhibited. I think we are all aware that the production of sugar is very important to certain of the Commonwealth developing countries, particularly those in the Caribbean. Long-term planning is essential for sugar production. It is not quite clear to me what the position is over a period of time. The noble Earl referred to the next 12 months in the case of this extension, and under what he called the "second issue" he referred to arrangements for sugar from 1975. Is he able to say for how long a period the safeguards of the interests of the sugar

1165
producers in the Commonwealth will continue, or is that a matter for resumed negotiations? If I remember rightly—this is my last point—even the Lancaster House assurances were not in any way indefinite; they were only for a period of years. I think the crux of the matter is the period of time for which the safeguards will continue.
3.52 p.m.
EARL FERRERS: My Lords, perhaps I may answer the questions put by the noble Lords, Lord Hoy and Lord Wade. The noble Lord, Lord Hoy, first asked what Her Majesty's Government were going to do about the export of live animals, having regard to the view expressed by another place the other day. Quite clearly, Her Majesty's Government will take into account that view, and are at present considering what action should be taken to give effect to the view expressed by another place last week.
The noble Lord also referred to the falls in the price of beef to which the Statement referred, and asked whether these would be noticeable in the price of beef in the shops in this country. Of course the falls that have taken place in the European Economic Community have varied from country to country. In this particular country over the last few weeks the fall in market prices for beef has been of the nature of 1½ per cent. Various countries have experienced greater falls, the highest being Germany, where there has been a fall of up to 10 per cent. Therefore, in this country, where the fall has been in the nature of only 1½ per cent., the effect will be less marked than would otherwise have been expected.
The noble Lord, Lord Hoy, was also concerned as to why exports of beef from Southern Ireland should now find their way into this country as opposed to the European Economic Community. The fact is that once the price of beef falls below 103 per cent. of the guide price for a period of one week, then the European Economic Community will impose the tariffs which it had previously removed. This would in fact be a direct disincentive to sales from Southern Ireland to the other members of the Community, which the removal of those tariffs had reversed, and it would, therefore, tend to make the products from
1166
Southern Ireland, which temporarily have been going to the European Community, come to this country.
Both the noble Lord, Lord Hoy, and the noble Lord, Lord Wade, were concerned, and with justice, about the future of sugar. Clearly, the Community decides the intervention prices for raw and refined sugar one year at a time, and the present prices will last until the end of June 1974. The Community will have to decide the prices for 1974–75 before then. But it is a fact that the Commission made it perfectly plain that they thought that it would be indefensible for the Community to import less than 1·4 milion tons, and indeed I think no country other than France challenged this. I have no doubt that the Lancaster House assurances, which were given by this Government after consultation with the Commonwealth producers will be met. Indeed in the Treaty of Accession, in Protocol No. 22, Section 3, which was signed by the Community and this country, it says:
'The Community will have as its firm purpose the safeguarding of the interests of all the countries referred to in this Protocol whose economies depend to a considerable extent on the report of primary products and particularly of sugar."
This is a commitment made by the European Community. All the Ministers, with the exception that I mentioned, have agreed in principle that the figure of 1·4 million tons for the import of Commonwealth sugar is reasonable.
LORD HOY: My Lords, the noble Earl has not dealt with the main point. Is it not a fact that the Commission said that it was a contravention of Article 92 of the Treaty of Rome for Britain to pay this £4 a ton to Commonwealth sugar producers, without which, obviously, it would be quite uneconomic to send sugar to this country? Was it the Commission who said that Britain was wrong to do so, and so was contravening Article 92? The waiver took place only when the matter went to the Council of Ministers, and that waiver will last for only twelve months.
EARL FERRERS: My Lords, of course the £4 a ton to which the noble Lord refers is not paid to Commonwealth producers, but to the refineries in order to enable them to have the equivalent of £17 a ton margin. It is perfectly true

1167
that the Commission put their view that this was in contravention of the European Economic Community's obligations. But, of course, under Article 93, Section 2, of the Treaty of Rome any Member State is permitted to appeal to the Council when it considers that there are special reasons for disagreeing with the Commission. This Article permits the Council to derogate from the conclusions of the Commission. It was upon that basis that my right honourable friend the Minister for Agriculture took this matter to the Council of Ministers, and they agreed unanimously to derogate from this particular recommendation.
LORD BESWICK: My Lords, I am sure the whole House warmed to the noble Earl when he quoted these words, that we were going to honour our obligations in letter and spirit. If the noble Earl really means to honour our undertakings in letter and spirit after 1975, we shall be behind the Government in that regard. But would he not agree that there is room for some doubt still when one looks, for example, at the statement made in Brussels by M. Henri Cayre, the President of the Confederation of European Beet-growers, when he said that had the Council really meant that they were going to let 1·4 million tons of Commonwealth sugar come into Europe they would never—and I quote—
"…have taken the trouble to search out the now famous wording of Protocol 22".
M. Cayre went on to say:
"European producers are guaranteeing European self-sufficiency and have every intention of going on doing so."
In the light of that sort of attitude, what would be the position of Her Majesty's Government?
EARL FERRERS: My Lords, first, let me make it plain to the noble Lord, Lord Beswick, that what the Statement refers to as the intention to honour the Lancaster House assurances in letter and spirit does not apply just to Her Majesty's Government but to the European Economic Community.
LORD BESWICK: After 1975?
EARL FERRERS: Yes. It is perfectly true that the French have always had a different attitude, and up to a point their attitude is understandable. They have
1168
always made it plain that it would be difficult for them to accept a cut-back in their own production to make room for Commonwealth sugar. But I can only assure the noble Lord, Lord Beswick, that discussions and negotiations are bound to go on, and people will put conflicting views. The European Economic Community accepted what is known as the aura à cæur, as indeed did this country, and it is our belief that the European Community as a whole intend to honour this particular agreement.
LORD SHINWELL: My Lords, is it not remarkable that Mr. Godber, who I am certain is doing his best in the interests of the United Kingdom, in the course of his Statement made no reference to the intransigent attitude of the French Minister of Agriculture who for the past ten days, according to reports in reputable newspapers in the United Kingdom, has been breathing fire and fury and declaring that on no account must there be any interference with French agricultural interests? Is that not the reason why so many of the items which have been referred to by the noble Earl arising from the Statement made by Mr. Godber have been deferred until the next meeting of the Council of Ministers? Is it not also the fact that we are experiencing considerable difficulty because of the attitude of the French?
EARL FERRERS: My Lords, I do not think that it would have been helpful had my right honourable friend mentioned, in a cool and reasoned Statement, that the attitude of the French Minister was intransigent. Our purpose is to negotiate over details and problems of the European Community. We have always accepted, and indeed every member has accepted, that there will be differences of opinion and differences of demand and requirements from different countries. It is in order to resolve this that there will be decisions and discussions at which different points of view will be put forward.
With regard to the question of the Sugar Agreement, it has been acknowledged and accepted as part of our joining the Community that we and the Community should have respect for the obligations that we have previously had to the sugar developing countries. To the best

1169
intentions of the European Economic Community, this is what they intend to honour.
LORD BESWICK: My Lords, in the statement from which I quoted from M. Cayre, he also said:
"Sugar is just one vehicle for aid. Its absence in one country can be replaced by another form of aid."
Has this possibility been part of the discussions to which the noble Earl referred? Is there a suggestion that we should buy off the Commonwealth countries by some other form of aid?
EARL FERRERS: My Lords, there has been no suggestion, to my knowledge, that any of the Commonwealth countries should be bought off by any other kind of aid. The whole purpose is to ensure that the sugar production from those countries should have a ready place within the Community. I can only repeat that, with the exception to which noble Lords have referred, the Ministers of the Council have been of the opinion that this should be done.
LORD WIGG: My Lords, does not the noble Earl realise that it is no use the Government, on the one hand, blaming the sharp rise in the price of commodities on to world conditions when they, by their action, have created the conditions of shortage? Is he not aware that one of the consequences of the uncertainty about the future of refining costs is to diminish the production of sugar in Jamaica? Is he not aware of the extraordinary situation last winter in Jamaica, a country which is one of the most natural low-cost producers of sugar, that it was without sugar because production had been cut down under the shadow of the agreement which the Minister has announced to-day?
EARL FERRERS: My Lords, there was a conference at Lancaster House some two years ago which was attended by all the countries of the Commonwealth who were involved in sugar production. It was decided then what would be the appropriate level of imports of sugar from those countries. With regard to the future, it is Her Majesty's Government's hope and intention that that undertaking should be approved and should be kept. Of course it is up to the Commonwealth sugar producing
1170
countries themselves to negotiate directly with the European Economic Community on future supplies, in which of course Her Majesty's Government are extremely interested.
LORD NUGENT OF GUILDFORD: My Lords, is my noble friend aware that his observation that there is likely to be an improved prospect for sugar beet growing in this country will be very welcome? Can my noble friend, knowing, as he does, the great value of sugar beet as a break in the corn rotation, tell us how this prospect might mature in terms of an increased sugar beet acreage here?
EARL FERRERS: My Lords, I think that we are getting a little premature on that. I would tell my noble friend Lord Nugent that the reason behind this is the fact that there will be the phasing out of the Australian sugar quota in the course of the next few years, and that supply of sugar which, at the moment comes from Australia, will have to come from some other parts of the European Economic Community. It is cur hope that some part of that will come from this country.
LORD BALERNO: My Lords, may I ask my noble friend whether the Government are aware that a continuation of this acute shortage of vegetable protein will almost certainly result in a rise in the price of beef? May I ask whether he has any information as to when, if ever, the United States is likely to raise its embargo on the export of soya beans?
EARL FERRERS: My Lords, it is perfectly true that the shortage of protein is bound to cause great concern to producers of beef, and indeed to the Government, because it is bound to result in a rise in prices. I can only tell my noble friend Lord Balerno that M. Lardinois is going over to America this week to discuss the position with regard to soya beans. My understanding is that there is likely to be a better crop there of soya beans this year than last, and if this is so possibly it will help to lessen the effects of the world shortage of protein. I cannot give my noble friend the answer as to whether and when the United States will lift the embargo on exports of soya beans.
LORD WIGG: My Lords, would the noble Earl not agree that the problem can be expressed arithmetically quite simply? In Jamaica we are paying £64 a ton, but the agreement for beet sugar which was welcomed by the noble Lord below the gangway is at £100 a ton. Of course the farmers in this country welcome it. That is what the French want—£100 a ton. The French being what they are, is he not aware that they have hit on the slick idea of withdrawing the subsidy for refining costs, and as it is more expensive to refine the sugar from Jamaica, if they withdraw the subsidy here it will work against the sugar that comes from the Commonwealth?
EARL FERRERS: My Lords, the point is that the subsidy has not been withdrawn. I would only say, in deference to the noble Lord, Lord Wigg, that when he says that he found that the problem was arithmetically simple, I have never found anything to do with sugar, Commonwealth sugar agreements or international sugar agreements, in any way simple.
LORD WIGG: My Lords, the point is that the row with the French is that they want to withdraw the subsidy on refining because they want us to favour beet sugar.
EARL FERRERS: My Lords, maybe they do, but they have not succeeded.
LORD WIGG: Not yet.
BARONESS WHITE: My Lords, would not the noble Earl agree that it is all very well for the noble Lord, Lord Nugent, to speak up for the beet sugar growers in this country, but they are capable of growing other crops, whereas there are many sugar islands, particularly in the Commonwealth, which are not capable of growing other crops? Surely we have always regarded sugar as the touchstone of whether or not the Economic Community was really concerned about the Third World. If we do not speak up for the Commonwealth sugar countries and prefer to take votes from East Anglia, we are really in breach of our moral obligation to our Commonwealth partners.
EARL FERRERS: My Lords, I think that the noble Baroness, Lady White, has
1172
slightly turned the implication—I am sure unwittingly—which my noble friend Lord Nugent put into his question. Her Majesty's Government have always been concerned about the Commonwealth sugar interests. That is the reason why they convened the Lancaster House Conference, and that is the reason why, having come to an agreement, they were able to persuade the European Economic Community to write into the Treaty of Accession that which has been written into it and which I have quoted. I would only repeat—and I accept that this is a very important point—that the Commission made it plain this week that they thought it would be indefensible for the Community to import less than the 1·4 million tons, and no country other than France challenged that.
LORD ABERDARE: My Lords, I wonder whether I may suggest to your Lordshops that as we have been nearly half-an-hour on this Statement, and are in the middle of a most important Committee stage of a very important Bill, we could perhaps have just one more question and then call it a day and move on to the next Business.
LORD WALSTON: My Lords, I shall put my point as briefly as I can, declaring my interest as an East Anglian sugar producer but one who does not have a vote. I hope the noble Earl was not accurately reflecting Government policy when he indicated that the coming to an end of the Australian sugar quota would mean that this sugar would be replaced by sugar beet from Europe. I should hope a good proportion of that sugar, if not all of it, might come from the developing countries of the Commonwealth and elsewhere. May I at the same time, while welcoming the one year's Agreement which has been achieved and about which I am certainly very happy, as I am sure the sugar producers in the Commonwealth will be, reiterate the point made by my noble friend Lord Hoy and by my noble friend Lord Wigg, that sugar production is a long-term business, and express the hope that Her Majesty's Government and the Minister of Agriculture, in particular, will press upon their colleagues in the Community the overriding necessity of having long-term agreements for all these products, particularly sugar?
EARL FERRERS: My Lords, I sympathise with the wish of the noble Lord, Lord Walston, to have long-term agreements for these commodities, a wish which I think will be shared by a great many people and by a great many countries. I hope that I did not give the impression that when the Australian sugar quota came to an end all of that production would be absorbed by beet growers in this country. If I gave that impression, it was an erroneous one. Clearly, there will be a gap left by the sugar which at the moment comes from Australia, and it will be a matter of negotiation as to how that gap will be filled. It is not impossible that some of it might be filled from elsewhere.
LORD SHINWELL: My Lords, I do not want to put a question. I want merely to ask whether I may voice a vote of thanks to the noble Earl, Lord Ferrers, for having made a better defence in this House of the Statement which was made in the other place by the Minister of Agriculture.

LOCAL GOVERNMENT (SCOTLAND) BILL
4.14 p.m.
House again in Committee.
THE CHAIRMAN OF COMMITTEES: Perhaps I should remind noble Lords that the Committee is still considering Amendment No. 56 by the noble Lord, Lord Burton, to Clause 29.
LORD DRUMALBYN: It might be convenient if I resume the discussion and reply to my noble friend. This is another matter which has been discussed at least twice within the last five years in Parliament. May I remind your Lordships that we are talking about the qualifications for nomination as a local government candidate, and, in particular, the qualification of occupying land or other premises in the area of the authority. My noble friend wishes to add after the words, "occupied as owner or tenant any land" the words, "with a value of not less than £10", and the paragraph will then go on "or other premises in the area of the authority". I think my noble friend appreciates that one of the difficulties here is setting a value to the property or other premises which must
1174
be occupied for this qualification to apply. Whatever figure is chosen is bound to be an arbitrary one. My noble friend is quite right in saying that the figure used to be £10, which I think was fixed way back in 1947.
During the passage of the 1971 Bill, the Government took the view that no value should be specified, because occupation of property is one of a number of considerations which might indicate a person's interest in an area. If the property concerned was of very little value, then, in a normal case, a person's interest in the area would be very slight and he would be unlikely to want to stand as a candidate. But if he wanted to stand, he would first have to be nominated and it would then be for the electors to decide whether he should be elected. So it still remains the Government's view that no value should be specified, and that we should adhere to what was decided in 1971.
LORD BURTON: I note what my noble friend has said, but it seems to me pointless to have these words in the Bill if we are talking only about a peppercorn value which can be rigged by anyone. But in view of what my noble friend has said, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 29 agreed to.
Clause 30 agreed to.
Clause 31 [Disqualifications for nomination, election and holding office as member of local authority]:
4.17 p.m.
THE EARL OF SELKIRK THE EARL OF SELKIRK moved Amendment No. 57:
Page 16, line 35, leave out ("or").
The noble Earl said: Amendments Nos. 57 and 58 should be taken together. Clause 31 states what is substantially the law as it is to-day, and according to that if within five years before nomination day anyone has been convicted and sentenced to three months' imprisonment without the option in the United Kingdom, the Channel Islands, the Isle of Man or the Irish Republic he will be disqualified from standing. As the noble Lord, Lord Drumalbyn, has said, a British subject includes anyone who is a citizen of the United Kingdom, but this disqualification

1175
should apply equally to anyone who has been convicted in a court within the Commonwealth. That seems to be a common sense interpretation. It may be argued that it might be difficult to identify the circumstances, but if the circumstances are not identifiable then clearly they will not be found out. But I believe that if somebody is convicted within the Commonwealth and is sentenced to three months' imprisonment or more without the option, he should be disqualified in the same way as another person would be because of a sentence imposed in this country. I beg to move.
LORD DRUMALBYN: I do not think we should be under any misapprehension. The phrase, "British subject" goes a good deal wider than a subject of the United Kingdom and Colonies. I was in some doubt as to my noble friend's purpose in moving this Amendment, but as I understand it he takes the view that if a person should be debarred from standing for election as a local authority candidate if he has been convicted in the United Kingdom of an offence for which a three months' sentence has been imposed without the option of a fine, then that disqualification should also apply in respect of convictions in those areas where there are similar jurisdictions; that is to say, in the Commonwealth.
A Government Amendment adding sentences passed in the Irish Republic as a ground for disqualification was carried at Report stage in another place as a result of an undertaking given in Committee there. This seemed reasonable because of the status of citizens of the Irish Republic as laid down in the Bill and also because of what is known as the sentencing policy in the Irish courts; but, all the same, it was a departure from the disqualification provisions of the Local Government Act 1972 affecting England and Wales. It would be more difficult to justify a further departure from the common code especially having regard to the relative numbers of Commonwealth citizens in the three countries. There is also the point that it is quite possible that all Commonwealth countries do not follow the same kind of sentencing practice as is followed in the United Kingdom. It is possible that a minor offence in the United Kingdom will be less harshly punished than in some of the Common-
1176
wealth countries, and it would be perhaps less than fair if an apparently severe penalty passed in a Commonwealth country led to disqualification from membership of a local authority whereas a lesser and more reasonable sentence passed in a United Kingdom court for a similar offence did not.
There is also the point that if we are disqualifying people in respect of offences that merit a certain punishment, why stop at the Commonwealth? If you are going to disqualify people for offences, then they ought to be disqualified wherever those offences are committed if it is the moral content that you are looking at. So the Government think it wiser to keep to the present system. We have already extended it to the Irish Republic, but we do not think we ought to extend it any further.
LORD HUGHES: I certainly would not welcome the prospect of its being extended to any part of the world because at the present time there are some parts of the world where they think being a British subject is worthy of imprisonment.
THE EARL OF SELKIRK: This may or may not be the case, but I think the noble Lord has missed the point entirely. If he turns back, he will see that any British subject in this country can stand for local election, and a British subject is a citizen of any member of the Commonwealth. What the noble Lord says is that if anyone is convicted of an offence in this country within five years—and three months' imprisonment is the minimum—he may not stand as a member of a local authority. What I am saying is that if someone from any part of the Commonwealth comes here with a heavy criminal sentence on his back, he should equally be disqualified. The noble Lord says, "Oh, well, we do not know, about Comonwealth courts; some of them are very second-class; they convict people of all sorts of silly things." This is not so; it really is not remotely so. If it is fair that a person in this country who has a criminal record should not stand for five years, I think it should be equally so in the case of people from Commonwealth countries.
I must say, with respect, that the noble Lord's argument is wholly illogical. As to the extension to Ireland, I did not know it had been made at that time.

1177
But anyone with a criminal record coming here from abroad who has the right to vote can stand. It is a peculiarity of this country—in this respect we are probably unique in the world—that anyone from any part of the Commonwealth can vote and stand if he is on the electoral register. It is a peculiarity of this country; it is quite different from most other countries. I should have thought that at least the same rule should apply to someone coming here as in fact applies to citizens of this country. I really must ask the noble Lord to be good enough to look at this again. I do not think his answer has met my point at all.
LORD KILMANY: Having listened to the debate for the last few minutes, I am bound to say that I feel there is a good deal of substance in what my noble friend Lord Selkirk has said, and I very much hope that my noble friend on the Front Bench will think again before he definitely says "No" to what he has been asked to attend to.
LORD DRUMALBYN: I am perfectly prepared to think about this again, but the difficulties are these. In the first place, do we want to have disqualifications in the case of Scotland that differ considerably from disqualifications in England and Wales?
THE EARL OF BALFOUR: I am sorry to interrupt my noble friend, but is it not the case that either we have disqualifications for Commonwealth citizens or else, because they may have been sentenced overseas, they can come here and go immediately into local government if they want to, or stand for election? The Bill as I read it does not cover anybody who has been sentenced in the Commonwealth, irrespective of the crime. I think that is the point, and I ask my noble friend to look at it again.
LORD DRUMALBYN: My noble friend may say that that is the point, but it is not the point I was talking about. I am saying that we have to consider the relativities of qualifications in Scotland and in England and Wales. My noble friend is of course quite right, in theory at any rate, that a person having been sentenced for something and having served his sentence in the past five years, immediately on being let out of prison
1178
might come over here to start a fresh life and might stand for election as a representative in a local government area. Of course he might; but we have I think to consider the realities of these things—the prospects of his getting nominated, and so on, in circumstances of that kind. May I also say that we are not thinking only of Commonwealth citizens: we are thinking of British citizens who may have been sentenced abroad and then come back to stand for election here. We have not so far thought fit to include this in the disqualifications, but it is, again, another difficulty. If a British citizen is to be debarred for a crime committed in the Commonwealth, why should he not also be debarred for a crime committed in another part of the world? I think we have to get some kind of logic into this. It is not as easy as it looks; there are difficulties. But we think that, having regard to the realities of the situation, it is not necessary to do this, least of all in Scotland because the number of Commonwealth citizens coming into Scotland are proportionately less than those coming into certain parts of England and Wales.
LORD SHEPHERD: Perhaps I could help the noble Lord. Would it not be a fact that if there was a Commonwealth immigrant with such a record the likelihood of his getting a permit to take up residence in this country would be extremely remote, certainly in Scotland?
LORD DRUMALBYN: I am obliged to the noble Lord, but I was taking the extreme case, where he had got away with it.
THE EARL OF SELKIRK: I must say that I find it very hard to understand why the noble Lord should not change this and simply say that anyone who has been convicted and sentenced anywhere to not less than three months' imprisonment should not be competent to stand for local government. If that is what he wants, why not put it in? I really think that we want a measure of logic about this matter. I am not thinking, of course, of people sentenced to three months: I am thinking of scoundrels. If a scoundrel comes here there should be an absolute bar which can be enforced. The argument that sentencing may be different in different countries is, with

1179
respect, quite illogical. If it is valid in this country, it should be valid over a wider sphere.
LORD DRUMALBYN: I note that there is some support for this proposal. My advice at the present time is that it would be difficult to do this, but in view of what the noble Earl has said I will take another look at it to see whether it would in fact be practicable. We have a little time before the next stage to do that, because obviously it is a rather complicated matter.
THE EARL OF SELKIRK: I am grateful to the noble Lord. I felt a sort of conservative obstinacy in the noble Lord's approach to this problem: that this is the law at present, and why should we change it? But now he changes to quite a different line and says it might be difficult. I said at the beginning that it might be difficult; and, of course, if it is not known, then it is not known. But where this is known then it can be effective. I am very happy to accept what the noble Lord has said, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 31 agreed to.
Clauses 32 and 33 agreed to.
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 59:
After Clause 33, insert the following new clause:
Declaration by member elected by local authority
" .A person who is elected by a local authority as a member of the authority shall, before attending a meeting or otherwise acting as a member of the authority, sign a declaration that:—

(a) none of the disqualifications for office set out in section thirty one of this Act apply in his case:

(b) he is otherwise qualified for election in terms of section twenty nine of this Act:

(c) he accepts office as a member of the authority; and

(d) he will faithfully perform the duties of the office;

and any person attending a meeting or otherwise acting as a member of an authority before signing such declaration, or signing such a declaration knowing any statement therein to be false, shall be liable on summary conviction to a fine not exceeding fifty pounds."
The noble Earl said: Throughout my time as a member of a local authority I have always signed a declaration very
1180
much on the lines of this Amendment. I admit that the words, "by a local authority" in the first line of my Amendment are wrong. There will be no co-option, so those words would not apply; otherwise the new clause reads reasonably satisfactorily. I regret to say that I have not managed to find these words in the Bill. It happens that I have never had to fight an election, but I have always had to sign a declaration that I will perform my duties efficiently. I presume that this point must be covered somewhere. I beg to move.
LORD DRUMALBYN: My noble friend is quite right: it is contained in Clause 7(3). His Amendment says:
"A person who is elected by a local authority as a member of the authority shall … sign a declaration…."
This relates only to co-option and is already covered in the Bill.
THE EARL OF BALFOUR: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clauses 34 to 36 agreed to.
Clause 37 [Filling of casual vacancies]:
4.31 p.m.
LORD HUGHES LORD HUGHES moved Amendment No. 59A:
Page 19, line 39, after ("election") insert ("(a)")
The noble Lord said: This is a paving Amendment for No. 59B and deals with the question of co-option. The Bill changes the law in this respect in that at present there is a power, a very wide power, to co-opt members to a local authority as the authority may decide. In the Bill there is no provision for co-option in any circumstances. If a vacancy occurs more than six months before the end of the Council's term of office it will be filled by means of a by-election. But if the vacancy occurs in the six months before an ordinary election is due it will remain, unless there are so many vacancies that the council is reduced by one third. The second possibility is so remote that one wonders why it is in the Bill at all. I have never heard of a council where the vacancies were so numerous, whether from resignation, death or imprisonment, that

1181
one third of the council went from the scene.
What is very common is that a single vacancy occurs, and there are a number of authorities in the country which are run on Party lines. In my home town, in the last seven or eight years, neither side has ever had a majority of more than one, and for a period of three years or six years there was equality. Decisions rested entirely on the casting vote of the Lord Provost. I think that it might be bad for government if, during the last six months of a council's life, because a vacancy was created, the majority in the council changed. There could be a situation where for the last six months of the council's existence there was a complete futility, in that the new majority might spend a considerable part of the time electioneering in the way of undoing decisions taken in the previous period. That is not the sort of thing which leads to good government.
My Amendment would permit a local authority to co-opt a member, if a vacancy occurred during the last six months of the council's term of office. I emphasise that it is only during this period that the Government are not providing that there should be an election. But I think it is important that if a council wishes to co-opt in those circumstances it should be free to do so. If the control of a council were unaffected by a single vacancy, or even two vacancies, within the six months, probably the council would not bother to do anything about it. But I think it right that good government should be made possible for the whole four years. Or, if one looks at it from the political point of view, the minority might say that it would be equally effective that bad government should at least be continuous right up to the end of the term, and that the electors should decide whether what had been done was good or bad. But we ought not to create a sort of "lame duck" situation in the last six months of the council's period of office.
LORD BURTON: I am sure that we were interested to hear the noble Lord, Lord Hughes, expounding the disadvantages of having political councils.
LORD HUGHES: The noble Lord, Lord Burton, is not usually so misunderstanding as that.
LORD DRUMALBYN: Perhaps what my noble friend Lord Burton means is that the noble Lord, Lord Hughes, is looking at this as a matter of fact at present; irrespective of whether it is desirable or not. Is not that right? I am bound to tell the noble Lord, Lord Hughes, that his Amendment is defective because he has linked it with subsection (2):
"Where a casual vacancy in any such office occurs within six months before the date of the next election …"
There is then the remainder of subsection (2), which he does not seek to amend, after which he wishes to add a provision for co-option which does not fit in very well with the words:
"where an election under subsection (1) above is not held, the vacancy shall be filled at the next ordinary election."
The drafting of the Amendment is defective, if I may say so, but I agree that there is a good deal in the noble Lord's argument. There are considerations both ways. There could always be extreme cases whatever we do, such as the case which the noble Lord mentioned. But if he will be good enough to withdraw the Amendment, we will look at the matter again before the next stage.
LORD HUGHES: I am quite happy to do so. Had I thought there was only a defect in the drafting that would affect the issue, I would have had the noble Earl, Lord Balfour, draft the Amendment for me. The noble Earl seems to be establishing a reputation as a draftsman—and perhaps a record for the number of Amendments withdrawn. But I will join him in that and ask leave to withdraw the Amendment, on the assurance that the Minister has given.
Amendment, by leave, withdrawn.
Clause 37 agreed to.
Clause 38 [Disability of members of authorities for voting on account of interest in contracts, etc.]:
4.39 p.m.
LORD HUGHES LORD HUGHES moved Amendment No. 60:
Page 20, line 11, leave out ("fact") and insert ("nature of his interest").
The noble Lord said: This Amendment relates to a matter that is giving a great deal of concern at the present

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time in respect of the declaration of interest by members of a council. I had better say in advance that I do not claim to be a draftsman, and if I am told that the drafting is defective I will immediately accept that that is the case. What I am certain about is what the Bill is doing and what I want to do. The Bill deals with two types of people who have to declare an interest; one is the member and the other is the official. The Bill says that if a member of a council has a pecuniary interest, direct or indirect, and is present at a council meeting, he should declare the fact. What takes place at present is that if a member attends a meeting he stands up and says, "I beg to declare an interest". But he does not say what the interest is. He does not say whether he is employed at the works as a janitor, or whether he is a major shareholder, or whether he is interested in a contract, or whatever it may be. He merely says, "I beg to declare an interest". Then he takes no further part in the proceedings. That complies with the law. Instead of merely declaring an interest he should declare the nature of that interest. I want him to be more specific than he has to be at present. That is the object of Amendment No. 60.
It will save time if I may, with permission, speak also to Amendment No. 61. This deals with the other part of the matter, the part which is similar to that dealt with in Clause 68. The clause we are now discussing deals only with the declaration that has to be made if a member is present at a meeting when the matter is being considered. Let us assume that someone wishes to evade the law. Let us assume that he has something to conceal. He is not going to risk breaking the law by taking part and helping to get the business through; for by concealing his interest he is going to place himself in a difficult position. A man who wants to do something underhand will be careful, as things now are, to declare an interest and to arrange for someone else to do the work for him, or to absent himself from the meeting. If he absents himself from the meeting he is under no obligation to declare an interest.
Let me now, if I may, read Clause 28 of the Bill:
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"If it comes to the knowledge of an officer employed, whether under this Act or any other enactment, by a local authority that a contract in which he has any pecuniary interest, whether direct or indirect (not being a contract to which he is himself a party), has been, or is proposed to be, entered into by the authority or any committee thereof, he shall, as soon as practicable, give notice in writing to the authority of the fact that he is interested therein."
It goes on to apply the same conditions to that officer as apply to a member. My second Amendment takes care of the situation where a man has an interest in a matter but is not present at the meeting, either through accident or intention or because he is not a member of the committee concerned. My second Amendment would require in these circumstances that if a member becomes aware of the fact that such a matter is going to take place or has taken place he shall take exactly the same action as the officer of the local authority is required to take: that is, he should notify in writing the nature of his interest. I can see no reason why in a matter of this kind in which there is so much public interest at the present time there should be a stricter set of rules for officers of local authorities—who are much less likely to have an interest in contracts—than there is for members of the authority. I beg to move.
THE EARL OF CROMARTIE: I should like to support the noble Lord, Lord Hughes, on this Amendment. As he knows, we have recently had a vast increase in matters in which a great deal of money is concerned: I refer to oil and to consequent heavy interests in building. This problem has exercised our minds for some time as a county council and I would strongly support the noble Lord on this Amendment.
THE EARL OF SELKIRK: I referred to this issue in the course of the Second Reading. I have an Amendment down later which touches on this subject but which I think is greatly inferior to the one that the noble Lord. Lord Hughes, has put down. He has taken the case of anyone who is not a member of a particular committee—and that is very important—and of the need to state the nature of the interest. For a long time we have had close rules about contracts but we now have in relation to planning permission a far more difficult matter than in relation to contracts. As my

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noble friend Lord Cromartie knows, the values involved in planning permission can be colossal.
My approach to this problem is this. The great majority of people who go into local government are perfectly honest people. We have a duty to see that no temptation comes to them that would divert them from the standards they held before they went into local government. We should make it as difficult as possible for anyone to transgress. The second side, which is just as important, is that the public should know that members of local authorities would have the utmost difficuty in doing anything to their own advantage. I believe that the wording which Lord Hughes has used is good wording. I am not going to say that it cannot be improved—probably the Government can do something about that—but the lines are sound, and I hope the Government will accept the Amendment or undertake to produce something closely parallel to what is intended by it.
LORD BALERNO: I should like to support the Amendment moved by the noble Lord, Lord Hughes. So far as I recollect, I was the only speaker on the Second Reading of this Bill who drew attention to the state of affairs which is occurring in Scotland at the present time and which probably has been going on for a rather longer time than we suspect. I then particularly welcomed Clause 40 which I think meets a great many of the points raised in this debate. It is that a book should be kept in which members of authorities will record their own and their spouses' interest in any particular subject and that this book will be made available for examination by any local government elector. I welcome what the Government have done in this matter. I am sure that when it is appreciated that it exists, it will be very widely welcomed throughout the country. I am grateful to the Government for what they are doing—and to put a little extra polish on it, Lord Hughes' suggestion is a very good one.
THE EARL OF BALFOUR: I, too, would support this Amendment. I think that Lord Hughes has raised a vitally important point. So far as Amendment No. 60 is concerned, I feel that there may be either a declaration of the nature of the interest or possibly—and I should like
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Lord Hughes to consider this—that the member simply leaves the meeting. It might not be strong enough; but on one or two occasions I have been involved in such situations and whenever a matter has arisen in which I have an interest I have just left the meeting. I refused to discuss anything about it with anybody. It once happened over something which was then a little embarrassing (and is so to-day) and I should not have liked to resign from the council because of this one item. I backed right out of it; I had nothing to do with it. If that was possible, it would achieve a lot of points. A matter to which I have strong objection is that of a member who might be quite a senior employee with a building firm being present when a building contract comes up to be discussed. I feel that that person at that meeting could gain information that an outsider could not get. That is wrong. That person should not have attended the meeting. I must say I am grateful to the noble Lord, Lord Hughes, for putting down this Amendment. I am sure we all feel that the tighter we make these regulations the better.
LORD BURTON: I agree that this Amendment has much to commend it. I am a little worried, however, about the words, "If it comes to the knowledge of a member". It will not be very easy to know whether a member did or did not know about the matter in question. It could be said that he should have known about it if he had read all his papers. But he may not be on the committee. We all know that we shall have a great deal of paper work to read, and it may be that he did not know about the matter. I do not want to interfere with the Amendment, but I feel that the question of whether he did or did not know about it should be looked at.
LORD HUGHES: I was not too happy about these words, but I adopted them because they are the form of words in the Bill in relation to an officer. This seems to me, in one sense, to be quite satisfactory because a comparatively minor matter could arise which affected an individual—an indirect pecuniary interest—and he did not know it had taken place because it was so insignificant. In such circumstances, we must give a man the benefit. It would obviously be a defence to say: "I did not even know

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that it had come up." This is why I think in the case of an officer, and in the case of the member, the matter is conditional upon the words "If it comes to his knowledge". We are really concerned here to ensure that no councillor or official on a matter of substance enables something to be done for his benefit by concealing information which might change the position if the council were aware of it. That is what we want to prevent.
I cannot believe that any member or official of a committee, with something of that kind coming up, would not know about it. The noble Earl, Lord Cromartic, referred to large building contracts in the oil industry. Just imagine a contract running into some hundreds of thousands, if not millions, of pounds and a director of a company saying: "I did not say anything about it because I did not know about it." Some people might believe that; but if they did, they ought not to be members of local authorities—which brings in another point, whether a man is of sound mind if he believes that sort of thing.
I look forward to hearing what the Minister has to say on this matter. I honestly believe that the Bill does not go far enough. I want to emphasise the fact that it is my opinion that the number of people in local government who are doing things that they ought not to do is a very small proportion of the total. Any tight piece of legislation of this kind will not affect or worry the great mass of individuals, because they are never going to be doing anything which might be an infringement of the law. Most of them will have no interest to conceal at any time; and most of them, if they have an interest, remote or otherwise, are only too ready to make it known. They do as the noble Earl, Lord Balfour, does—it is the commonest procedure: they say exactly what the interest is, and then go away. Nobody is then under any misunderstanding. That is not what we are concerned about. We are concerned about the individual who is trying to do the wrong thing, and we want to make it as difficult as possible for that individual to get away with it.
THE EARL OF PERTH: On that last point, raised by the noble Lord, Lord Hughes, and also by the noble Earl, Lord
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Balfour, I do not think the draft, as it stands, ensures that a man might have to go away. Clearly there are occasions when he ought to be asked by those present to go. I should hope that that would be taken into account in any drafting. The wording is merely that he should declare his interest, and not take part in the consideration, and so on. That is not enough. I should hope that we could so tighten up the draft that it would be open to the authority to say: "Please leave the room" rather than that he should sit and listen.
4.56 p.m.
LORD DRUMALBYN: The more I have listened to what has been said, the more I am convinced that everybody wants the same thing, but that it is a very complicated matter. I am quite certain that we all want to achieve what the noble Lord, Lord Hughes, has indicated. We want to see that not only the opportunities for somebody being able to use his position to bring decisions his way should be avoided, but also that people should not be allowed to use the council, so to speak, as a means of obtaining early information. There are those two aspects. I am not entirely in agreement with the noble Lord, Lord Hughes, in equating the position of the member with the officer of an authority, because the essential difference between them is that the officer has no opportunity to declare his interest, as he does not normally attend meetings unless he is the clerk, the adviser to a particular committee, or something of that kind.
As to the first point, that of declaring the nature instead of merely the fact of an interest, so far it has been considered sufficient to declare the fact and to remain silent, and not to leave the discussion. Declaring the nature gives rise to certain tricky little problems. Do you have to declare the full nature every time there is a discussion on the particular matter? With what degree of accuracy and detail must you declare it? There are difficult little points like that, and I am bound to mention them.
On the general point I think my noble friend Lord Balerno gave the reason; namely, that we have left it as the fact, so far, because we have introduced Clause 40, which provides optionally for the full disclosure of interests to be recorded and

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to be available for public inspection. So that not only will the clerk have notice in advance of any interests of members that they have disclosed, but so will the other members present. I have certainly found in another place that my fellow Members were quick to draw attention to any failure to disclose a known interest on the part of any Member of the House. It is more difficult to secure a disclosure of an interest that is not known. But here, of course, tied to subsection (1) is the sanction of a fine not exceeding £200, unless he did not know that the contract was the subject of consideration at the meeting. There is there the need to declare the fact, coupled with the fine. There is, furthermore, the register, which can act as a permanent notice to everybody of the interest in question.
I am not absolutely certain that we should be justified in making this change, or that if we did this would be the right way to go about it. I think I should draw to the attention of your Lordships the fact that the Prime Minister, speaking in another place on May 3 of this year, referred to the general question of a code of conduct in public life, and said that he was studying the part relating to local government. So the whole question of a code of conduct is under consideration. It may be that your Lordships, while sharing the views of everyone who has spoken to-day, may feel that in anticipation of this general consideration it would be a mistake to make a change at this time.
As I have said, I think we are all in sympathy with the general intention of the noble Lord, but I think it would be a mistake at the present time to make up our minds definitely. It may be that we shall be able to make further progress before the next stage, but my guess would be that it would take rather longer than that and that we should try to get simultaneous changes in England, Wales and Scotland.
LORD HUGHES: I can appreciate the point about the general view, and obviously it is desirable that the same sort of conditions should apply throughout the whole country. If that decision is known before we come to the next stage and if the code has been worked out, obviously the way will be clear for the Government to submit such Amendments to the Bill as will fit in with the code.
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Because I am quite certain that if a code of conduct for local authorities is produced and goes no further than this Bill, the Prime Minister can prevent a lot of time from being wasted by many people, because they need not look at it any further if that is all that is going to come out of it. But if something more effective is to take place, then obviously we ought not to wait for a change in the English legislation before we take the opportunity of doing something about it in Scotland. After all, it would not be the first time that Scottish legislation has set the pattern for what is subsequently done South of the Border—though in present circumstances we find that once the English decide to follow our example we then decide to go back to what we were doing before, as for instance we are doing with water.
If it is not possible to do some tightening up of procedure under the Bill, would the Minister consider with his right honourable friend the possibility of taking administrative action by circularising local authorities and giving guidance on the way they feel this should be done?—for instance, making it quite clear that just getting up and saying, "I beg to declare an interest", is not what the Government expect to be done, because such a statement is of no use whatever. If the Minister is willing to look at these points, then I shall be happy to ask leave to withdraw the Amendment.
THE EARL OF BALFOUR: I should like to say just one or two words. If a guide could be given to setting a first-class standard for local rules for a local authority—such as our own Standing Orders, for example—I think this would go a long way.
LORD DRUMALBYN: I am most grateful to the noble Lord for making two very valuable suggestions. I shall most certainly respond to what he has said to see whether between now and the next stage of the Bill these are practicable.
LORD TAYLOR OF GRYFE: I am sorry to delay your Lordships on this matter, but I wonder whether, following the suggestion of the noble Lord, Lord Hughes, that some administrative guidance might be given, in the declaration of interest we should define the nature of the interest. Shareholding is becoming

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rather dispersed, and it could be that people have a fairly remote interest in a particular matter. I think even the area of the Co-operative Society's involvement is one that might be covered by such administrative guidance.
LORD HUGHES: But is this not covered in the following clause. Clause 41(6), where the interest is in fact such a small one that it does not disqualify a person?
LORD DRUMALBYN: Yes. I think what the noble Lord, Lord Taylor of Gryfe, was referring to was a dispersal of an interest. If one has an interest in, say, a unit trust which again has a certain holding, it is difficult to determine exactly what that proportion is. The matter may perhaps not be as simple as that, but it illustrates the problem.
LORD HUGHES: This clause refers to cases where a holding does not exceed £1,000 or one-hundredth of the total nominal value of the issued share capital in a particular unit trust. There are not many people who own more than 1 per cent. in a particular trust. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD BURTON LORD BURTON moved Amendment No. 63:
Page 20, line 16, leave out ("£200") and insert ("£500 or 6 months in prison or both").
The noble Lord said: Here we have a derisory penalty of only £200 for corruption. We discussed this subject at our county council meeting last week and it was unanimously agreed that this was a ridiculous penalty. It is absolutely no deterrent and I feel it is very important that the punishment should be made to fit the crime. This question was also discussed in another place and a much larger penalty was suggested there than I have suggested. I would not be against that. The arguments given for not accepting it were that we should not be different from England. The noble Lord on the Front Bench has just had a reply on that point from the noble Earl, Lord Selkirk, and I was also glad to hear the noble Lord, Lord Hughes, rebutting it just now. There seems to be no reason why in Scotland we should not have something different from England, particularly if we are im-
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proving the Bill—and this would undoubtedly improve it.
The other reason that was given was that there was no demand for a higher penalty. During the course of the last year, since the English Bill went through, some extremely unsavoury cases have come to light. In particular, there is one in which a penalty of £200 would be absolutely ridiculous. Therefore I beg to move that the penalty should be increased to £500—and if any noble Lord wishes to propose more I should be only too happy—or six months in prison, or both.
LORD HUGHES: My noble friend, Lord Hoy, has given me a very good reason for making it more in Scotland than it is in England: if it is £500 in Scotland and £200 in England we may encourage all the corrupt people to go South of the Border.
LORD DRUMALBYN: I certainly would not rely on the argument in this case that we should not do anything different from England. I think the point of the argument, so far as people coming in from abroad or committing offences abroad are concerned, is rather different from the point we have here. There is a different quality about that argument. We should bear in mind that the offence here is not the offence of corruption but of failure to disclose an interest—which may be quite a different matter—or else the offence of taking part in a consideration or discussion of a contract as well. There are of course separate penalties under the Prevention of Corruption Act. The actual offence of corruption is governed by the Act, under which on conviction on indictment it is possible to get two years' imprisonment or a fine of £500, or, on a summary conviction, four months' imprisonment and a £200 fine. On that basis, I think that my noble friend would agree that it would be out of proportion to make it a £500 fine for simply failing to disclose an interest.
LORD BURTON: If my noble friend can assure us that if someone failed to disclose an interest when he obviously should have done and it would therefore come under this different Act which he has mentioned, then I cannot see any point in having this particular clause in

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the Bill. I should like to have an assurance that it would be possible to prosecute him under the other Act. If that is so, perhaps the noble Lord would consider withdrawing this clause.
LORD DRUMALBYN: We are talking of a totally different offence. One may fail to disclose an interest without actually doing it corruptly. If one is doing it corruptly, then it would be a matter for consideration by the authorities whether or not to prosecute for corruption. We are concerned only with the offence specified in subsection (1).
LORD BURTON: I thank my noble friend for that explanation, which I am sure will relieve the anxiety of a good many people. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 38 agreed to.
On Question, Whether Clause 39 shall stand part of the Bill?
5.10 p.m.
LORD HUGHES: I should like to ask some questions about Clause 39. Subsection (2) says:
Subsection (1) … does not apply to membership of or employment under any public body, and a member of a company or other body shall not by reason only of his membership be treated as having an interest in any contract, proposed contract or other matter if he has no beneficial interest in any securities of that company or other body."
I am foxed by what is meant by this. How can a person be a member of a company without having a beneficial interest in its security? I can think of one exception—a charitable body which is limited by guarantee, not having a share capital. I am a member of such a body, the Help the Aged Housing Association, in Scotland. That is a limited company not having a share capital. Is that what is meant by being a member of a company, but not having a beneficial interest in any of its securities?
The second point is in reference to paragraphs (a) and (b), which say:

"(a) he or any nominee of his is a member of a company or other body with which the contract was made or is proposed to be made or which has a direct pecuniary interest in the other matter under consideration; or

(b) he is a partner, or is in the employment, of a person with whom the contract was made or is proposed to be made or who has a
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direct pecuniary interest in the other matter under consideration."

Is a director of a company an employee in terms of Clause 39(b) and, in terms of that, does "a person" include a company or other body?
LORD DRUMALBYN: The answer to the second question certainly is, "Yes"; and I think the answer to the first question is also, "Yes". May I explain the situation, because this is a clause which starts with a wide provision in subsection (1) and then narrows it down in subsection (2). Subsection (1) covers, in effect, the case where the member, or any nominee of his, is a member of a company or other body which has a direct pecuniary interest in a contract or other matter, or the member is a partner or employee of a person with a direct pecuniary interest in the contract. These interests can arise where the member is a shareholder of a company (including a co-operative society), a trustee or a member of a society or club. Your Lordships can see how wide it is. The subsection also covers partnerships—for example, where members are in professional practice—and employment in a firm of any size. By virtue of the Interpretation Act 1889, an employee of a person includes an employee of any body of persons, corporate or incorporate.
Subsection (2) goes on to qualify subsection (1) by excluding membership of or employment under any public body and membership of a company or other body where the member has no beneficial interest in any securities of the company or body. "Public body" is defined by Clause 42—
LORD HUGHES: I am not concerned about a public body.
LORD DRUMALBYN: I am trying to put the matter in perspective. A public body, as defined by Clause 42, includes nationalised industries and undertakings, and governing bodies of universities and similar institutions.
A member may have both a direct interest under Clause 39(1) and an indirect interest under Clause 40 in the same matter. An employee may have an interest in a proposed contract because it is with his firm (that is an indirect interest) and also, because it would mean overtime for him, a direct

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interest. If he has a direct interest he will be caught by Clause 39 because of the great width of subsection (1). Subsection (3) brings in a third class of interest through another person. This is the main burden of the provisions here. It is a matter of fact in any particular case whether there is a direct or indirect interest, and it is not always easy to distinguish it at first sight. I am speaking without being briefed on this matter, but I imagine that this is one of the difficulties in disclosing the nature of an interest, because the mere nature of an interest itself might not fully disclose the reality of interest in the particular case.
LORD HUGHES: The Minister has answered all but one of my questions. He has not told me what is meant by a member of a company who does not have a beneficial interest in any securities of that company. I may be wrong, but I thought that a "member of a company" and a "shareholder of a company" were interchangeable terms.
LORD DRUMALBYN: "Securities" is a wide term; it covers any kind of debenture, ordinary or preference shares, or anything else.
LORD HUGHES: How can a person be a member of a company if he does not have a beneficial interest in any of its securities? A director is not a member; a man can be a director of a company without having any shares. He is not a shareholder, therefore presumably he is not a member of that company. That is what I want to get at.
LORD DRUMALBYN: He might be not merely a shareholder, but a trustee as well. I understand that this is the situation. I do not think membership of a company is used, in the widest sense, to include employees. I think it relates to a member of a company in the technical Companies Act sense.
LORD HUGHES: I am sorry, but I am still not getting an answer. I am being told what he may not be; but I want to know what he is. Can the Minister of State help? He is an accountant and ought to know from his own professional experience rather than his Ministerial knowledge.
LORD POLWARTH: Certainly one category coming under this description would be a person holding shares for another person's beneficial interest, for instance as a trustee or nominee. That is a common state of affairs. So far as I know, that is the main category covered by this Amendment.
THE DUKE OF ATHOLL: Did I understand my noble friend to say (I think I must have misunderstood him) that because of Clause 39(2) someone would not be caught by Clause 39(1) if he had no beneficial interest in the company? He might well be a director of a company, but not hold any shares in it; in which case I should have thought technically he had no beneficial interest, particularly if he was an unpaid director.
LORD DRUMALBYN: He is either an employee—and some directors I believe could be employees—or he is a member as a director.
THE DUKE OF ATHOLL: I thought that subsection (2) over-rode subsection (1); that is what worries me. But I do not think we can argue the matter now.
LORD DRUMALBYN: I do not think subsection (2) over-rides subsection (1). It is simply a clarification of it.
Clause 39 agreed to.
Clauses 40 to 43 agreed to.
Schedule 7 [Meetings and Proceedings of Local Authorities]:
THE EARL OF SELKIRK THE EARL OF SELKIRK moved Amendment No. 66:
Page 165, line 39, at end insert—
("Such standing orders will make provision whereby members of the council will be informed on request of any matter for which the Council has responsibility or on which funds have been suspended.")
The noble Earl said: I beg to move this Amendment to ask a question. The local authorities write their own rules of procedure: I think they generally get a model which the Government show to them. May I ask what assurance councillors have that they are informed on questions which they ask? I certainly know of one case where this is a matter of discretion of what is sometimes called "the Establishment". I am wondering

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whether it is desirable to make some provision in the Bill that councillors themselves are entitled to information on matters with which the local authorities are concerned and on which they spend money. In some ways this is more important than Clause 44, which deals with the Press, and I should like to know whether the Government can give any assurance that councillors or members of a council or any local authority can be given such assurance or such rights.
LORD DRUMALBYN: As I am sure my noble friend will be aware, it is not the case that a councillor has a right to demand information which is or ought to remain confidential. So there is already that exception. So far as we know, there is no great or continuing difficulty arising out of this matter, although there may be the odd difficulty that arises every now and again. But it would be difficult to lay down by Statute a general right without impairing the right to preserve information which ought to remain confidential. If my noble friend could bring to my notice any wide range of cases where there has been a failure to provide information, then I think there would be a case to argue here, but at the moment it is difficult for me to see how we could justify Parliament's intervening in a matter which is essentially a matter for standing orders, as my noble friend has said. If he has information it might be, as he said, possible to deal with it by circular in so far as it has not already been dealt with in that way.
THE EARL OF SELKIRK: I accept what the noble Lord says. This is really the point. If there were a case like this, what could the noble Lord do? So far as I know, the Scottish Office could do nothing. I am only saying that, unless something is put into the Bill, they will have no power to interfere at all with the procedures which are drawn up by the local authority. This is the point I am making. The noble Lord refers to a circular, but I do not think that would be of any use. If the noble Lord does not want it, I will not press him; I am only asking him to think about it. I think it is a fundamental right of councillors to be informed, and I was wondering whether some words to that effect should not be included in the Bill itself. However, in view of the noble Lord's
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answer I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Schedule 7 agreed to.
Clause 44 [Admission of public and press to local authority meetings]:
On Question, Whether Clause 44 shall stand part of the Bill?
5.24 p.m.
THE EARL of SELKIRK: I am moving the exclusion of this clause to see whether I can persuade the Government to write a clause that is comprehensible. I have done my best to understand this clause and I have read the Act of 1960; but I am not very much wiser. It is extremely obscure. The 1960 Act deals with a number of other authorities—health authorities, water authorities and others—which are not wholly connected with this. I should have thought that local authorities were entitled to a clear clause on how they stand in relation to the Press. I myself am not clear on how they stand at the present time. I think that any meeting of a local authority, whether it be the full authority or one of the major committees, must allow the Press to come in and must inform the Press, unless a resolution is passed—I am not clear by whom; whether it is by the committee or whether it be by the local authority itself. Nor, may I say, am I wholly clear about an extraordinary provision—Section 1(1)(c)—in the 1960 Act, which changes the rule if there is a public telephone on the premises not belonging to the local authority. Why the existence of a public telephone should make any difference, I cannot state. But the point I am trying to make is this. Can we not have a clause clearly stating how the matter stands? This is not unimportant, and this clause is very difficult to understand as it is at present drafted.
BARONESS ELLIOT OF HARWOOD: As the person who took the 1960 Act through the House of Lords (it was a Private Member's Bill, started in the House of Commons by the present Minister of Education, Mrs. Thatcher, and I was asked to take it through the House of Lords in 1960: it is the only Act taken through both Houses by ladies), I wish to defend it and also the particular paragraph. It is perfectly clear to me

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that that provision was passed in order that there should be no dubiety about meetings being open to the public and to the Press. Before that, there were meetings of county councils and committees, and so on, from which the Press were excluded. This caused a considerable amount of anxiety, and I think bad blood on occasions at these meetings. This Bill went through both Houses and the Act has now been working since 1960. I have seen it working very successfully in the councils on which I sit. The Press are of course admitted; the public are admitted. If there are times when one has to debate something in private someone can move that the Press be excluded. It is obviously reasonable to have a private debate on an individual person or an individual salary or on something the members do not want the Press to know about. In such a case the Press can be kept out. Otherwise they are present. I hope very much that this principle of allowing the Press and the public to come to meetings of councils will not be altered. I am bound to say that I do not agree with my noble friend Lord Selkirk that this provision is obscure, since it operates very well as part of the 1960 Act.
THE EARL OF MANSFIELD: I do not share the anxieties of my noble friend Lord Selkirk over this clause. It repeats almost word for word what became Section 100 of the English Local Government Act, and that itself was the subject of a fairly long and interesting debate in your Lordships' House. The actual clause was spewed out in the other place in the middle of night on Report. It was originally the product of the very last gasp of a Standing Committee—the very last Amendment which the other place made to that particular Act, as it now is.
The general principle, as I understand it (and I am sure that my noble friend on the Front Bench needs no help from me), is that the Press will be admitted to all deliberations of a local authority down to sub-committee level; that is to say, all meetings of the council or the authority, and all committees, but not sub-committees. I do not suppose there are many of your Lordships who would dissent from this principle. Previously, meetings of committees were held in
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private. But where a number of us were extremely concerned over this particular section—Section 100, as it became—was in regard to committees to whose deliberations, by the very virtue of their constitution or the type of matters they discuss, it is undesirable that the public or the Press should ever be admitted. I am thinking now of a committee which deals perhaps with staff appeals. I am not going to weary the Committee with a long list of other examples, but any of your Lordships who are in local government will readily appreciate them. There is no possibility of a staff appeals committee's ever admitting the Press or the public in their deliberations.
There were two subsections which were deleted in Committee from the English Local Government Act in your Lordships' House and which rendered it within the powers of a committee, acting properly and according to the laid down procedure, to exclude the public and the Press for a period of twelve months from all its deliberations. Unfortunately, the debate in your Lordships' House really centred on whether the Press and the public should ever be admitted to all meetings. Be that as it may, my noble friend Lord Sandford, who on that occasion conducted matters on behalf of the Government, undertook to continue thinking about the matter—I think that is the way to describe it. What I should now like to ask my noble friend is whether, to his knowledge, in England there have been further thoughts and whether those further thoughts have produced anything. In this particular instance, it is not so much a matter of principle because I think all of us are agreed that the maximum publicity, where proper, must be given to everything that a local authority does. It is a matter of procedure, to tie up, as it were, the procedures which should be adopted where a committee is never going to discuss matters that should be ventilated through the normal media of publicity.
LORD DRUMALBYN: I am afraid that I am not in a position to tell my noble friend Lord Mansfield exactly what progress has been made in the consideration of this matter in England and Wales. I am sorry if my noble friend Lord Selkirk finds it difficult to understand this particular clause. I wonder whether it would help him if he knew what it meant to

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start with, because sometimes when you know what it means to start with you can understand it better afterwards. So if I may tell my noble friend what it is intended to mean, it may help him. But let me say first that the purport of the 1960 Act is that, in general, meetings of the local authorities and certain similar bodies—that is to say, the list of bodies given in the Schedule to the Act—are to be open to the public; and the exception to this general rule is that if the authority resolve, for reasons of confidentiality or other special reasons, to exclude the public they may do so, but they are obliged to live reasons for the exclusion.
The object of Clause 44 is mainly to extend the scope of the 1960 Act to all committees of the authority as well as the council itself. My noble friend Lord Mansfield is quite right there. It also forestalls a device which has been used to evade the spirit of the 1960 Act so far as the council is concerned; namely, that of dropping one member of the council from the meeting and to declare the meeting to be a committee, which, not then being a full council, does not fulfil the conditions of the Act. Clause 44 brings all committees, however constituted, within the ambit of the Act, so that in every case if it is desired to exclude the public, which also means the Press, they may do so, but they are obliged to give reasons for the exclusion.
As to the question of telephones, as the Press need to communicate immediately the contents of their notes, and so on, to their papers, it is thought reasonable that they should have acccess to telephones on the premises for the purpose, and where there are joint committees, or where the premises belong to the local authority or one or more local authorities appointed to the committee, they shall be treated as belonging to the committee. So the purpose of this is to extend the whole thing to the committee for the purposes of the Act and put the access to committees on exactly the same basis as access to councils at present.
THE EARL OF SELKIRK: I was in Singapore when the noble Baroness piloted the Bill about which she spoke, and I apologise if I was not aware of the fact that she was the sponsor. I think I did not know what it meant in the first place, but I am bound to say that,
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although it may be easy for the noble Earl, Lord Mansfield, to understand, I do not think it is easy for other people who are immediately concerned with it. My whole point in raising it was to try to persuade the Government to write into the Bill what I understood to be the position. If they do not want to do it I do not mind very much.
LORD DRUMALBYN: I think my noble friend has made a point here at which we should look, because if it is not clear to him perhaps we should look at the clause to see whether it can be made more clear.
THE EARL OF SELKIRK: I thank my noble friend.
Clause 44 agreed to.
Clause 45 [Attendance allowance and financial loss allowance]:
LORD STRATHCLYDE LORD STRATHCLYDE had given Notice of his intention to move Amendment No. 67:
Page 23, leave out line 25 and insert:—
("(1) Members of regional councils shall be paid a salary. Members of other councils").
The noble Lord said: As there are other Amendments on the Marshalled List with the same object in view, I do not now intend to move this Amendment.
5.35 p.m.
THE EARL OF CROMARTIE THE EARL OF CROMARTIE moved Amendment No. 68:
Page 23, line 25, at end insert ("other than a councillor for a region").
The noble Earl said: With your Lordships' permission, as this Amendment leads on into my Amendment No. 70 I shall take the two together. This is a difficult position. I realise this because I have spent a good many years thinking about it and have only recently come up with what I believe to be my final decision. It is a matter for the consideration of your Lordships and also it is in the interests of that much abused word "democracy". I fear that in the great area of the Highland region, where lack of transport facilities and sometimes climatic conditions are quite dissimilar from the smaller Southern regions, the less affluent would-be candidates might be discouraged from standing. As I mentioned during the Second Reading debate,

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there could be a danger of regional members, who in any case will be occupied on local government business for many days in the month, holding unnecessary meetings at the expense of the ratepayer. I do not say that this would necessarily happen, but it could happen. In the change of local government, conditions in which we have served for many years are radically altered and I, with others, have come to the conclusion that the answer is that regional and not district councillors should be paid. I beg to move.
LORD POLWARTH: Before other noble Lords intervene, I think I should be right in saying that as there are several subsequent Amendments dealing closely with the same subject with only small variations we might be in order if those noble Lords interested in them took the opportunity to debate the subject in general on this first Amendment.
LORD TAYLOR OF GRYFE: I am delighted to acept the suggestion of the noble Lord, Lord Polwarth, that these matters might be discussed together, because they raise a very important principle in connection with the future of local government. The issue that is at stake here is very clear; namely, whether we should pay members of local authorities or whether they should be provided for by means of attendance allowances. I suspect that if this enactment were passed, the Secretary of State for Scotland, whose duty it would be to decide on the rate of the salaries to be paid, would look at the situation so far as the responsibilities are concerned. The noble Earl, Lord Cromartie, has indicated his concern for the Highland region. I am also concerned with the fact that the Strathclyde region will be responsible for 2 million people and the responsibilities of a regional councillor in Strathclyde are very considerable. In fact, my Amendment would permit the Secretary of State for Scotland to extend the principle to other members of local authorities. If we take the Glasgow district council prior to its reduction in size as from yesterday's date, if the council was responsible for more than a population of 1 million it may be that in discharging his responsibilities the Secretary of State would look at the whole field of service in local
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government and make decisions appropriate to the responsibilities of regions and districts.
The Amendment does not state any sum and I think this is appropriate, for the reason I have just suggested. It is a fundamental principle of democracy that all men and women who wish to give public service should be available to give public service without penalty. I suggest that the arrangements whereby they are given the expenses and allowances, plus the day-to-day allowances mentioned in the Bill, are less attractive than being paid a straight salary. It may be said that people will be available for this service who are already in receipt of substantial salaries from other duties. In that event, the salaries would attract a tax liability and so the State would recover a substantial amount of the additional salary paid to people in that position.
I have had some experience of local government in the city of Glasgow. I was a fellow-councillor with the noble Lord, Lord Strathclyde, for a number of years. The problem of people claiming on local authorities for expenses and so on has always been a very difficult one. In this particular case we are getting away from the old loss of earnings claim, and I am glad that this is so. I think to receive a salary for the job carries with it much greater status than to receive so much per attendance. As the noble Earl, Lord Cromartie, has said, there is a tendency, perhaps a human weakness, that if you are paid so much per day or per attendance it is quite easy, particularly if so much of your time is taken up in local government, to make it almost a full-time job and to have six meetings where perhaps two might have served. That is a danger if an attendance allowance is paid—and it is a very real danger.
Therefore, I suggest that it would be much more in keeping with the status of the job, and it would make for better government, if we were to pay a straight salary. I know that at present there are people who are serving in local authorities, who have to get time off to do so and whose salaries are reduced accordingly because they are of little value to their employer. I know from cases in the organisation with which I was associated that this is so. There is a further penalty on people, because their

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superannuation and pension expectancy is based on a much reduced salary. If we paid a straight salary it might be better. We are initiating new government here and we want it to be better government. I suggest that this principle might be a contribution to better government.
LORD STRATHCLYDE: I rise to support the Amendment just moved. If I may say so as a preamble, it seems to me that if we are to obtain the highest possible level of efficiency in local government it is surely necessary that we should encourage and succeed in attracting to serve as councillors capable men and women from social and financial backgrounds who can give service of the highest quality. I think it is now generally accepted that councillors should receive payment for their services and that they should be able to recover in addition inescapable out-of-pocket expenses. The Bill proposes that payment should be in the form of attendance allowances and financial loss allowances. I strongly support this Amendment as against the suggestion in the Bill.
I want to point out the differences which arise and what should happen. The Amendment states that payment should be by way of salary, and for this reason it seems to me that prospective candidates should be quite aware of how their finances are going to be affected on their becoming councillors. If they are partners in a professional firm, or in some form of business, their partners will wish to know to what extent the finances of the firm will be affected before giving permission to their partner to undertake this public service. Where the payment is by salary no difficulty is likely to arise, for most partnership agreements stipulate that all the earnings of the partners are paid into the firm. On the other hand, where payment is by attendance allowance there is a temptation—I put it no higher than that—to prolong business and to multiply meetings and the number of attendances available. Where salary is paid there is no such temptation. Business will be expedited; everyone will want it to be dealt with in a businesslike way and as speedily as possible, and meetings will be kept to the minimum number necessary for the proper and efficient conduct of affairs.
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It is only in these circumstances that active men and women, busy and usefully employed elsewhere, will be attracted to serve as councillors.
Let me say that there is another advantage in the payment of a salary. It is that by expediting business it will allow highly paid officials to spend more time in their offices dealing with council business instead of interminably attending meetings. As this is a matter of great importance, I believe, in getting the proper people to serve as councillors, I hope that the House will support the Amendment which has been spoken to by the noble Lord opposite, and that my noble friend on the Front Bench will find himself able to accept it.
LORD STRATHEDEN AND CAMPBELL: This is an extremely difficult problem. When I first gave evidence to the Wheatley Commission, some seven or eight years ago, I opted for an attendance allowance, but at that time the whole matter was very much in the air; there had never been any question of paying county councillors or local government councillors at all. Having considered it further, after a great deal of thought I am now in favour of the Amendment proposed by the noble Lord, Lord Taylor of Gryfe, with one condition, which I think makes it extremely difficult to accept: that there must be a different salary paid to the councillor for the Strathclyde region from that which is paid to the councillor for the Borders region. There is no comparison at all in the amount of work which will be involved in those two jobs. I do not know why that cannot be done. It is perfectly competent, I should have thought, for the Secretary of State, who will have to lay down the amount of salary anyway, to lay down the amount of salary either on a per capita basis or in some such way so as to make it a fair and reasonable salary for each of the different regions. I support the Amendment of the noble Lord.
5.49 p.m.
THE EARL OF BALFOUR: I should like to say a few words in opposition to the payment of a salary. First and foremost, we have an excellent example in this your Lordships' House: that is, that democracy will work only if the ordinary man is prepared to give up his own free time to make it work. If he has not got

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that free time, he should not stand as a councillor anyway. Furthermore, let us consider what has really happened.
LORD TAYLOR OF GRYFE: I am sorry to interrupt the noble Earl, but is not the point that he can then make free time if he is paid a salary, whereas if he is not paid a salary, if he is in employment from nine to five, he cannot have the free time necessary to discharge this duty?
THE EARL OF BALFOUR: In reply to the noble Lord, Lord Taylor of Gryfe, if a person does suffer loss of earnings there are special provisions in this Bill, as there were in the 1947 Act, that the employer must give him time off to attend to council duties; also, as an employee, he gets the loss of income allowance, which I must admit is not nearly generous enough. But there are such provisions, and so far as I know they work quite well. To the best of my knowledge, even in the big cities the position of Lord Provost is not considered as a full-time appointment. He is not expected to be on duty every day of the week. In future, the cities will become second tier authorities with less work to do. Equally, we shall be in the position of having the whole of local authority functions divided in half, roughly half going to the region and half to the district; so that in many ways, certainly at district level, there will be less work to do as a councilor than there is at the present moment. Now a local authority councillor deals with all the functions—education, roads, planning, and so on.
I should like my noble friend to consider a generous allowance on a daily basis, paid roughly in the same way as that in your Lordships' House is paid, and not something for the forenoon and something for the afternoon or on an hourly basis, which will not work. Those people who have a lot of travel and work to do, such as chairman of the education committee, or Provost, should be provided, out of the expenses of a local authority, with a car which they can virtually call their own for as long as they hold the job, together with a full allowance for telephone and other expenses which I feel should be covered. I am quite certain that if we pay councillors we shall attract the wrong type of
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people into local government. I am certain that England came to the right conclusion when they rejected payment of councillors, and I am certain that an attendance allowance on a generous footing is what we need.
Finally, if we decide that there should be a salary, is it going to be the same salary for every regional councillor, whether he is the convener, chairman or an ordinary councillor, whatever his duties may be? If that is so, we shall get into serious difficulties. The moment the word "salary" is mentioned we come up against income tax, and the councillor may end up poorer than he is now. Do let us remember that any ordinary attendance allowance is not subject to the filling in of income tax forms or anything else; it is classed as out of pocket expenses.
THE EARL OF CROMARTIE: Before the noble Lord sits down, he did suggest giving cars to councillors? I know he lives in a rather more confined space than I do. Does he suggest that those councillors to the Islands authorities should be given a yacht?
LORD STRATHEDEN AND CAMPBELL: Again, before the noble Lord sits down, can he enlighten me further? He says that this attendance allowance is not liable to income tax. I understood that it is and that it is treated as ordinary income.
THE EARL OF BALFOUR: Not to my knowledge.
THE EARL OF MANSFIELD: I am bound to say that I find the purpose of this debate most difficult to follow. As I understand it, the Government are committed to providing some sort of remuneration for those who are engaged in local government. Also, as I understand it, the remuneration is to be on the basis of money received for part-time work, and it is to be taxed. This is no loss of profit allowance which is not subject to tax. As I understand it, certainly the English Local Government Act is on that basis. Therefore I find it difficult to understand why noble Lords are so passionate in regard to a salary which is taxed rather than allowances which are also taxed. Equally, my noble friend Lord Cromartie might care to reflect on whether it is better for the taxpayer to

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have councillors who are straining to have more meetings in order to get more allowances, or to have persons elected to the council who take their salaries without turning up to any meetings. It seems to me that there are points in favour of both those views.
I have had certain experience of this by virtue of my membership here and of the European Parliament, and I would come down on the side of allowances. I am bound to say that we argue about almost everything in six languages, but I have never yet heard anybody suggest that we have more meetings in order that our £22 should be increased. On a more serious note, I hope that members of local authorities would really not be so low as to occupy themselves with that aspect. I should have thought that if the Secretary of State, and indeed the local authorities working together, combined to make a scale of attendance allowances—which is not merely like that of your Lordships' £8·50—which is reasonably generous to take into account the work which councillors will have to do through their constituencies, not just the cost of attending meetings and the cost of missing their work on that day or whatever happens to be the case: a fairly generous attendance allowance, but not a full-time salary—it would then, I think, be up to the individual councillor to attend meetings as often as he can and he will duly claim the money in relation to each meeting he has attended.
5.57 p.m.
LORD HUGHES: I find difficulty in knowing what I want to do on this proposal in the absence of any information from the Government as to what the attendance allowance is going to be. Circumstances could arise where obviously a councillor would feel that, if the attendance allowance was sufficiently generous, he could give all the service that was needed without in any way having to arrange extra meetings in order to get more money. The noble Earl made reference to the £22 for members of the European Parliament. One wonders whether they are not out of pocket every time they attend, whether it is sufficient to give them a profit, whether they might want to spin it out there, too. The argument in relation to councillors is that
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if the allowance was generous, and therefore was profitable, there might be needless meetings. I rather agree, but I do not think that this is likely to be a serious factor.
There is a difficulty about salaries—and I must say that I start off with a preference for salaries rather than allowances—but the Amendment which my noble friend Lord Taylor of Gryfe has moved tries to take account of this particular difficulty, namely that the nature of the duty will vary enormously from one authority to another. Some of the very small districts in the Highlands which have had to be created because of the great distances involved may have many fewer meetings than, for instance, a district of Glasgow. My noble friend's proposal would make it possible for the Secretary of State to fix different salaries for different councillors in different regions. While this would be possible, I certainly should not like to be in the shoes of the Secretary of State if he were to say that a regional councillor in region A would get £3,000, whereas a person in region F (and I am carefully not naming them, in case it should be thought I am attributing value to their services) would get £1,500, in district B £2,000 or in district X £500. He would be inundated with protests. This is where I presume the Government see the attraction of the daily allowance. It will be governed by the volume of work to be undertaken. In the bigger authority, presumably the people will have more work to do and will legitimately be involved more often. I do not know whether that is how it will work.
We all have our ideas about what an appropriate salary would be. Figures have been mentioned: £2,000, £2,500 or £3,000 for regions; £1,000 or £1,500 at district council level. All we have in relation to allowances is the supposed leak that the Secretary of State or Secretaries of State were considering an attendance allowance, taxable, of somewhere between £12 and £16 a day, plus, in particular cases, the subsistence and travelling allowances, which of course would be non-taxable. If the allowances were sufficiently generous, then I might be attracted to them rather than salaries. But of course, if the Government's idea of a generous allowance was something like £5, £6 or £7 a day—or even £8·50, I should not agree, and in

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those circumstances the argument for salaries would be overpowering.
I should like the Minister to make some statement about what the range of allowances might be, but I do not expect that he will be able to do so. If he were in a position to do so, it would be much easier for all concerned to say whether they favour attendance allowances or salaries. I do not expect that we shall reach a decision on this point to-day, but if it were to come to Report stage and the Government had not made up their mind about attendance allowances, then I suspect the House would almost certainly be forced into the position of putting a stated salary in the Bill. The Minister said on Second Reading that the local authorities are not to be elected until May next year, so that there is plenty of time for the Government to arrive at a decision. I want to disabuse the Minister of that idea. One of the difficulties which the Parties or associations are already having is to find out on which authority people are willing to be nominated. The membership of a regional body, certainly of a larger region, is going to be virtually a full-time job.
I spoke to a very able councillor in my own part of the world the other day, and said to him, "I suppose you will be going for the region". He said, "Well, at the moment I think not". I asked him why. He replied, "I have a very good job, but if I am going to hang on to my job I must give a reasonable amount of service to my employer. If I go on a regional authority, and I am going to be engaged three or four days a week, I would not expect my employer to continue my employment, because I should not be able to give him the sort of service he needs. If that were to be the case, I would have to decide what the alternative was." If it were a totally inadequate allowance, the answer of that man would be, "I will go on the district authority, where I shall be perfectly able to do my job and attend the meetings, because in that particular area it is almost certain that the new authority will meet in the evenings, so that the work will not interfere with my employment." But I am quite certain that in many cases regional councils will not be able to arrange for evening meetings. So that position is much more urgent than being related to the date of the election. The
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decision ought to come in time for people to make up their minds where best they can give their service, at regional or district level. I think it would be wrong if large numbers of people opted for the district because they did not think they could afford to be members of the regional authority.
6.5 p.m.
THE EARL OF SELKIRK: May I say one word on this subject, as I have an Amendment down? I think that if the Government want to get a new spirit in local authorities they will have to pay something that looks very like a salary. I honestly do not believe that they will get the nature of the change which we all believe is fundamental unless something like this is done. I think the noble Lord, Lord Taylor, put his finger right on it when he said there is a dignity in the office which comes from payment of a salary which I do not think would come from daily attendance allowances. I am not sure that this House is a good example, or the European Parliament. There are already stories going around about the European Parliament—not, if I may say so, about our members, but about other members. I am not going to say whether they are right or wrong, but there are stories going round. I wonder whether it matters if we do have different salaries. When a man goes to a job he knows exactly what he is going to get; he knows that before he goes into it.
May I add one other point? I suppose that we in Scotland must be tied to England. Is this really the position we are in; that we dare not make any decision, whatever our requirements are, unless they fall in with those of our neighbours? If that is so, I should have thought it is not much use continuing the discussion very much longer.
LORD STRATHCLYDE: May I intervene for one further moment? I am afraid I did not succeed in making clear that one of the particular attractions of the salary system is that it will enlarge the area from which candidates will come and to a very considerable extent. I know this from experience. For many years I was responsible for getting candidates for the City of Glasgow Council, and I found time and time again that the partners in businesses would not allow their younger partners to come and serve because they did not know what it meant

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to their firms. If in fact they know that they are going to be paid a salary, of whatever sum it may be, they know that that money is not being lost to the firm, as it would be otherwise. Under a salary scheme you will get quite a number of excellent candidates whom you would not get under the allowances provisions.
LORD BURTON: I am very much in agreement with the noble Lord, Lord Hughes, on this point. It is an extremely complicated issue. I came in with a completely open mind. Having listened to the debate, I am rather inclined to come down on the side of allowances. There is a tremendous variation, not only from region to region and from district to district, but even with individual councillors within those districts. Take, for instance, our own Highland district: a councillor coming from Skye or Caithness would find it very much more onerous than one living just outside Inverness, if he is doing the same amount of committee work. He will have to spend so much time travelling to and from his work. I find it very difficult to know how anyone is going to fix a salary which will be reasonable and commensurate to the amount of work the individual is doing. Some councillors may well be committee chairmen or vice-chairmen. Are they going to get different salaries from the ordinary members? It seems to me that allowances would be fairer.
If I might make one further observation, I hope the Government will look at the question of loss of earnings. I think it is very difficult for a self-employed person to establish what loss of earnings he has. If you are a farmer, and perhaps employing no one else, I do not know how you work out your allowance for coming to a regional council or district council. It is quite easy for someone on a £10,000 salary to apportion the time, but for a self-employed person it is not easy to calculate loss of earnings.
LORD HOY: It is a very difficult subject. As I said not long ago, if I had had to vote that day I should have voted for salaries rather than allowances. When the noble Lord, Lord Burton, says he is inclined to come down on the side of allowances, all I would say is, do not come down too quickly or too heavily. This is a very difficult issue, and the real
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trouble is that the Government have put us into this difficulty. I do not say that spitefully or in any other way, but we are faced with the position that we do not know what the Government are going to do, or what they want to do. If we had the opportunity of making a choice between a salary that is going to be specified or an allowance, we could more readily make up our minds which to choose.
I know some young people who at the present time are members of the council in the city of Edinburgh. Whether one agrees or disagrees with their political views, they are of absolutely first-class calibre. What has become quite apparent is that they will certainly not go to regional councils; the time that would be demanded from them would be much too great. Some who are employees of certain associations and firms, and perhaps some in business for themselves, could not afford to give up the time that the regional council is going to demand unless they knew that all the loss in attending was not going to fall on them.
It seems to me that until such time as the Government tell us what they intend to do, we shall continue to be in this predicament. I heard the noble Earl, Lord Mansfield, say, "Do you think that councillors are going to create meetings?" The noble Earl must realise that councillors are just as human as other folk. I am not going to say that they will create meetings, but indeed they are not going to continue—as we sometimes do—until 10 or 11 o'clock at night, when they can adjourn at 5 and come back the next day and finish the business at a reasonable hour. You have all these views to take into account when you are considering a question of this kind. I do not think that the noble Lord, Lord Polwarth, is going to tell us what the Government's decision is. Indeed, he kindly sent some of us a letter—I do not know how many—after the last debate, and made it perfectly clear that the Government were giving it "due consideration". That is not a very new answer so far as Governments are concerned. We are in this position, and it is a difficult one, because in England, where the Bill has already become an Act and been put into operation, the Government have not yet decided what they are going to

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pay people who are working at the present moment.
LORD BURTON: Does the noble Lord insinuate that no one is going to stand for a council until he knows what he is going to get out of it?
LORD HOY: No. If the noble Lord had been listening he would have heard me say that there are hundreds, thousands of councillors in England operating the present Act and they do not know whether they are going to get a penny out of it. They do it because they want to do it. If Parliament is going to make a change and call for greater demands on councillors so that it makes it impossible for them to earn their livelihood in the ordinary way, Parliament has no right to make those demands without paying compensation in one form or another.
That is the position that we are at, whether it is going to be a salary or allowances. We could be taken out of this difficulty if we knew what the Government proposed to do. It is not noble Lords on either side who have introduced this Bill; this is Government legislation, but the Government cannot make up their mind how they are going to pay for it. Until we get that information I do not think that we can make a decision. I should like to put on record once more that unless we get something much more constructive, or much more informative, then I remain of the opinion that I had some time ago, that a salary would be a better solution than allowances.
6.13 p.m.
LORD TAYLOR OF GRYFE: May I delay the Committee a moment or two to discuss one or two points that have been raised. The major problem is the differential in rates for different authorities. This is a serious problem, but it is not unknown in business to-day to employ people on job evaluation to assess the relative responsibilities of particular jobs. It is even done by one organisation of other organisations. I suggest that there are techniques of job analysis and job evaluation that could quite readily establish the amount of time that people have to serve in a fairly independent way, and take the responsibility off the shoulders of the Secretary of State for Scotland—though to some extent the ultimate decision will be his.
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The Government have said where they stand in this matter; all they have not filled in is the amount of the attendance allowance, but the Bill has said that it will be an attendance allowance and not a salary. We are seeking to secure the best form of local government and attract the best people to local government service, and the question we have to ask is whether payment of an attendance allowance or a salary is more likely to achieve these ends. I must say that if you are asking people to give public service of this kind you must give them some idea of what they are involved in in terms of expectancy of reward. To say that they will get an attendance allowance does not give anyone any information on which they can decide whether to give up their job in order to serve, and this is what many people will have to decide before they will undertake this public service. It does not tell them what adjustments they will require to make in their personal budget. If you state that the salary for this service is x amount, at least an individual who makes a decision to be a candidate for public office knows where he stands.
I would say to the noble Earl, Lord Mansfield, and to the noble Earl, Lord Balfour, that what is practised in this House is not a very good precedent. We do not get an attendance allowance; we get a figure to cover our expenses bill and our hotel expenses, and this is provided for in the Act under "expenses". We do not get an attendance allowance because we attend; we have to produce certificates that we have spent £8·10, if we claim that amount, or £5 or whatever it may be. It is not a good practice. May I say to the noble Earl, Lord Balfour, that this House is probably the poorest example of an organisation which permits a broad opportunity for people to enter it. What we are talking about is calling on the whole resources of our community for public service, and to make it easier and not penalise them for offering themselves for public service. I suggest that to provide a salary makes it possible for people to plan, makes it possible for them to arrange their domestic circumstances to give this service, and by the technique of job evaluation some of the political conflicts that are visualised in the differentials between the various authorities can be avoided.
LORD BALERNO: When the Bill was first published I was strongly in favour and there has been opportunity for study of the discussions in Committee in another place, and after hearing the debate to-day, especially the arguments of my noble friend Lord Strathclyde, I want to give my support to Lord Cromartie's Amendment that the regional councillors should be paid a salary.
THE EARL OF PERTH: May I ask the noble Lord, Lord Taylor of Gryfe, about one point in his argument which I did not fully understand. He said that if you paid a salary it would enable a man to decide whether he should give up his other job. If I understand that aright, I find it a dangerous principle, because it may lead to a professional class who are working on this job only as salaried functionaries, and who would give up their other interests. I do not think we want that type of person all the way through. I wonder whether I was right in understanding that the noble Lord is advocating a salary so that there shall be a professional class doing this work and nothing else.
LORD TAYLOR OF GRYFE: I am sorry to intervene again, but a question has been directed to me. All I am saying is that in many areas there are working class people—not professional classes—who would require to make a decision about whether to give up their employment, because it is not easy in many forms of employment to operate part-time in this way and to give four or five hours' service to the public and three hours' service to an employer. I had to resign from my public service because I could not afford to take time off in my former employment in order to give public service. All I am saying is that for many people it will be that type of decision, and it could be better made by people knowing what is the expectancy of salary in such cases. I think it would broaden the area of selection of candidates.
LORD HUGHES: There is another way of looking at this question. I cannot say that I agreed with the noble Earl, Lord Perth, about a fixed salary bringing in a professional man. If a man is so interested in the work of, say, a regional council, and it involves so much time
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that he is prepared to give up his present method of earning a living, with the risk attached that he can be discharged at the end of four years' employment without any redundancy pay, superannuation or pension, simply because he has not satisfied the electors, he will not necessarily be a bad councillor because of it. The argument can be advanced that when he has put himself at risk to this extent, he will make every endeavour to be so good a councillor that his chances of re-election are greater than other people's. After all, we do not have to look any further than the other end of this building to find that that is what many Members of Parliament have had to do. They have had to give up their employment in order to be able to do a satisfactory job as Members of Parliament, and I doubt very much whether anyone would argue nowadays that those who are able to combine another job with the job of a Member of Parliament are better than those who have had to give up their outside employment and who give their whole time to being Members of Parliament.
We have not yet reached the situation, even in regional government, where we can say that being a councillor is a full-time job, but undoubtedly the feeling for salaries is almost overwhelming in the case of regional councillors, because in so many cases, even if it will not be a full-time job, it will certainly be very near it and will restrict very much the type of other work that a man is able to undertake with satisfaction, either to his own business or to his own employer, if he is to do a satisfactory job as a regional councillor. I have not the slightest doubt that that is what influenced quite a number of your Lordships to change from the general idea of allowances to the strong possibility of salaries for regional councillors.
6.24 p.m.
LORD POLWARTH: We have had an extremely interesting discussion about a subject on which, while there was a predominance of views in favour of salaries, there was equally quite a strong lesser element in favour of the opposite, while some noble Lords indicated that at present they are in doubt. It may be helpful to explain the Government's thinking on the question of the payment of councillors and how it has developed. We start with the present system of a

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financial loss allowance, which any councillor can claim up to a maximum of £5·50 a day, free of tax, but only if he can prove that he has actually suffered loss of income of the amount that is claimed. I think we are all agreed that this is not a satisfactory system and it should not be perpetuated. Certain classes of people have found it difficult to establish loss; the rate of take-up of the allowance is low; and there is no doubt that an unknown number are deterred from seeking office because of the inadequacy of the loss allowance.
The Maud Committee on Management of Local Government in England and Wales—and I have deliberately refrained from commenting on our neighbours to the South, because we are discussing a Scottish Bill—reporting in 1967, recommended that the financial loss allowance should be replaced by a sort of flat rate expense allowance, to be fixed by local authorities themselves and claimable by individual members in whole or in part. Then we had the Wheatley Commission which went further and came out in favour of an outright salary for all members, as a reflection of the value of the service which a councillor gave to the community. Although this salary was not to presume that the ordinary councillor was serving full-time, it was to be substantial and it was to be augmented at the discretion of the council to the extent of up to 100 per cent. in the case of those councillors who had special responsibilities, such as chairmen of committees. It was accepted that such a salary would be taxable.
The Government have no quarrel with the basic objectives of the Wheatley recommendations on this matter. We certainly want to get away entirely from the idea of financial loss allowance, with its overtones of hardship payment and the need to prove every penny spent. We want to see a simple and effective system which will be taken up by a much higher proportion of people, and we do not shy against the idea of regarding payment as a form of remuneration. However, while the payment of a salary is one way of achieving these objectives, it is not the only way and we are not convinced that it is necessarily the best way.
A number of noble Lords have made very valid points. It could be that the
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offering of a salary might be an inducement to people—I hope not too often—to go into local government, when they do not necessarily intend to give their maximum effort and time to the job. There is the much more real problem of how we settle the level of salary in relation to the different duties falling on those in chairmanships and ordinary councillors. There is the difficulty of deciding the level as between different regions and districts, some of which would need to have far more meetings with a greater demand on people's time. How would one come to a conclusion about who should be eligible for special responsibility payments? One can envisage acrimonious discussions internally, if this were left to each authority to thresh out. This is a very considerable draw-back to a flat rate salary, and it would be a very invidious job for a Secretary of State, or indeed for any independent body to attempt to assess the values of the services demanded as between different regions and districts.
We have therefore proposed a system which differs from the ideas of both the Maud Committee and the Wheatley Commission and which seems to us to have advantages over both. I shall not follow the analogy of your Lordships' sessional allowance, because that analogy is limited, although to some extent it will operate in the same way. But the system we propose has the advantage of simplicity; it will be easily known who is entitled to what; it will be widely taken up, because it will be payable as of right to any councillor regardless of his own income and employment; it will apply equally to regional, district and island councillors; it will deal satisfactorily—I do not mean necessarily equal in amount, but in the same way to different bodies—with chairmen of committees and "back-benchers", and the fact that chairmen of committees will be doing more work will be reflected in the amount to which they are entitled.
I should like to correct the noble Earl, Lord Balfour. These allowances will be taxable. They are allowances: they are not the reimbursement of expenses. Of course, certain travelling and subsistence expenses will be reclaimable, as at present. They will be taxable, but that is inevitable under our tax laws if we are to have a tax system which offers remuneration, as this is, just the same as it would be in

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the event of a salary. The amount of the allowance, I can assure your Lordships, will be fixed so as to take account of the fact that it is to be taxable.
The question of proliferation of meetings has been raised by a number of noble Lords. I know this is often alleged with regard to local government in Scotland, but to what extent it is a fact I do not know. In the first place, there will be no danger of prolonging meetings to increase the allowance because the allowance will be fixed on a maximum daily basis, and there should therefore be an incentive to finish off the day's business as expeditiously as possible.
LORD STRATHCLYDE: May I interrupt the noble Lord for a moment? He says that it will not lead to the carrying over of business. But will it not? Will they not be able to say, "We will not finish the business to-day; we will have another meeting to-morrow", and in that way get in two days?
LORD POLWARTH: With great respect, I was coming to that. I had not said that: I had said that there would be no danger of stretching out a day's meeting in order to get more. As to the question of carrying over, of proliferating meetings, I think we must have some faith in the members of these new authorities; and I am sure that the public, with their rights of admission, and the Press, with their rights of attendance, will be fairly quick to spot this kind of practice if it is developing and will bring it to the attention of local electors.
I come finally to the very tempting bait which the noble Lord, Lord Hughes, once again dangled in front of me regarding announcing the rate of allowances in order, as he told us, to enable him to make up his mind as to which horse he will back.
LORD HUGHES: I would hope not just me. Do not do it just for me: I think others will be interested also.
LORD POLWARTH: It was the noble Lord, I think, who originally raised the matter at a previous stage. I think there is a genuine difficulty here, and, as my right honourable friend the Secretary of State said in another place on July 5, we are not ready to announce this yet. We still have to consult local authority associations; we have had other more press-
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ing matters to consult them on in the meanwhile; and we must—and I submit to your Lordships that this is a matter of importance—have regard to the particular stage at which the Government's counter-inflation programme stands. We are also, after all, considering fixing a figure that will not commence to be payable until May of 1975. That is the better part of two years ahead. I should have thought that there were advantages in waiting till as reasonably near the first elections as possible to fix this amount, because of the distance ahead when it should first become operative.
I appreciate the wish of those standing, or intending to consider standing, to have knowledge of the figure. I doubt whether it is really quite so pressing as the noble Lord made out, as to need it at this time in relation to elections next May. I would only repeat my previous assurance that an announcement will be made in good time for the first elections in May. There is another point here. If it were a salary that we were proposing at this moment, we should find ourselves in exactly the same difficulty about announcing the amount of the salary. Having said that, and realising that there are arguments on both sides, the Government are very definitely of the view that the balance of advantage is in favour of the system we are recommending, and I would ask your Lordships to support that view.
On Question, Amendment negatived.
LORD TAYLOR OF GRYPE: I beg to move Amendment No. 69.
Amendment moved—
Page 23, line 25, leave out from ("councillor") to end of line 4 in page 24, and insert ("shall be paid such salary as the Secretary of State may by order made by statutory instrument determine.").—(Lord Taylor of Gryfe.)
On Question, Amendment negatived.
THE EARL OF CROMARTIE THE EARL OF CROMARTIE had given Notice of his intention to move Amendment No. 70:
Page 23, line 30, at end insert—
("( ) A councillor for a region shall be paid such salary as the Secretary of State may by order made by statutory instrument determine.").
The noble Earl said: I am quite prepared not to move this Amendment on one straightforward understanding.

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Unless we get a clearer view of what is going to happen, I shall put this Amendment down again at the next stage of this Bill. Meanwhile, I do not move this Amendment.
6.36 p.m.
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 72:
Page 24, line 4, at end insert—
("(5) Allowances may be paid by regional island or district councils in respect of expenses reasonably incurred by their members in connection with the installation or use of telephones for the purpose of the performance of their official duties.")
The noble Earl said: Clause 45 of this Bill was taken from Section 119 of the Local Government Act 1948, Chapter 26. The subsection which I am seeking to insert into the Bill is worded in almost exactly the same way as an amendment to Section 119 by Section 36 of the Local Government (Scotland) Act 1966, Chapter 51—which, by the way, is being repealed by Schedule 28 to this Bill. I beg to move.
LORD POLWARTH: While I am grateful to the noble Earl for drawing our attention to this point, I would submit to your Lordships that the Amendment is not necessary. The new power given to local authorities in Clause 69 of the Bill enables them to
"do any thing (whether or not involving the expenditure, borrowing or lending of money …) which is calculated to facilitate, or is conducive or incidental to, the discharge of any of their functions ".
This is sufficiently wide to cover the payment to councillors of expenses connected with their telephones; and I have no doubt that the use of a telephone and the costs connected with it are very necessary expenses, and will be considered so by councils. The noble Earl quoted a section with which I do not think I am familiar, but it could be that he is thinking of Section 36(4) of the Local Government (Scotland) Act 1966, which amended part of the Local Government Act 1948, enabling local authorities to pay for the provision of telephones for their members. This specific power is no longer required because of the general powers conferred under Clause 69 of this Bill.
THE EARL OF BALFOUR: May I ask my noble friend one further question?
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Would this cover having a car? Would Clause 69 of this Bill cover, say, a Provost being provided with a car?
LORD POLWARTH: Presumably it would be a question of what expenses the authority considered reasonable for the carrying out of the office.
LORD HUGHES: Presumably there is some such power at the present time; otherwise, there are an awful lot of Provosts and Lords Provost going about illegally in cars.
THE EARL OF BALFOUR: With that assurance I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 45 agreed to.
Clauses 46 and 47 agreed to.
Clause 48 [Payment of expenses of official and courtesy visits, etc.]:
On Question, Whether Clause 48 shall stand part of the Bill?
6.40 p.m.
LORD HUGHES: I have a small query on Clause 48. Paragraph (a) refers to defraying expenses incurred in making "official and courtesy visits", and paragraph (b) refers to defraying expenses incurred in entertainment by way of "official courtesy". Is there a difference? In the first instance does "official and courtesy" mean an official visit or a courtesy visit, or a visit which must be both official and courteous? The second one I am clear on. "Official courtesy" would cover a conference coming to town, distinguished visitors and so on. What I am doubtful about is why there should be the use of this phrase "official and courtesy visits".
LORD POLWARTH: I would assume that one could easily differentiate between two kinds of visit. There could be a visit to study, say, some particular new type of sewage plant and so on which was official in that the visit was for official purposes. When we come to courtesy, one example would be the admirable practice of twining towns between this country and the Continent. These are examples of courtesy visits which within reason would be encouraged. These two examples occur to

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me. A visit purely for goodwill purposes to a twin town would not necessarily be classed as an official visit.
LORD HUGHES: I would not agree for a moment. Unless a council authorises a courtesy visit to a twin town and agrees to pay the expenses, it cannot take place; therefore it is an official visit. It may be an official visit for the purposes of courtesy. I have been on visits to Orleans and before I went the council decided which members of the council were to go. If a member who was not on the list travelled—on one occasion one did—he would find himself having to pay his own expenses.
LORD POLWARTH: We appear to find some difficulty in distinguishing between what is official and what is not official. I can assure the noble Lord that I will look into this and communicate with him as to the specific meaning of "courtesy" as distinct from "official".
LORD HUGHES: I think that all that is needed is the phrase "official visits".
Clause 48 agreed to.
Clauses 49 and 50 agreed to.
Clause 51 [Establishment and general purpose of community councils]:
THE EARL or BALFOUR: This Amendment is clear in its wording. We have a lot of business to-night. I should be happy to move it formally. I would answer any questions noble Lords may care to put. I beg to move.
Amendment moved—
Page 27, line 11, at end insert—
("(1A) A community council shall be established for one or more electoral divisions or wards as described in Section 5 of this Act;
(1B) The Boundaries of a community council shall be the same and conform to the boundaries of the electoral division or divisions or ward or wards, as the case may be;
(1C) An electoral division or ward other than a regional division shall not be divided between two or more community councils.").—(The Earl of Balfour.)
LORD POLWARTH: As I see it, the noble Earl's Amendment seeks to have two effects. First he says that community councils have to be established for one or more electoral divisions or wards. I take that to mean that this would make the establishment of community councils compulsory—
THE EARL OF BALFOUR: I thought they were complsory; that we were supposed to start them under the Bill.
LORD POLWARTH: We give every encouragement, as will be seen further on, when we come to the establishment of community councils. We are not laying down that they must be established for every community. We are saying that every district must put forward to the Secretary of State for Scotland a scheme for the establishment of community councils within its districts. There may be reasons why one particular part of the district should not require one. It is not correct to say that the establishment of community councils is compulsory. It will be encouraged, and actively so.
The main point of the noble Earl's Amendment is to tie boundaries of community council areas rigidly to those of electoral divisions or wards. I think that this is against the tenor of the idea of the community councils. It is the essence of our thinking that these bodies should be set up if and where local communities ask for them. District councils are required to prepare these schemes, but once a scheme is confirmed it is for the local people to make up their minds and say how they want it set up, its rules, its purposes, and also its area. It could be that the logical area for a community council would overlap the boundaries of electoral divisions or wards which are established for quite different purposes. We feel that his Amendment would restrict unduly the freedom of action of all parties in connection with community councils, which are not statutory local government bodies but a totally new form of organisation that we are introducing in this Bill. Therefore we feel that such a proposal as the noble Earl suggests would be unduly restrictive.
THE EARL OF BALFOUR: In that case, may I beg leave to withdraw the Amendment?
Amendment, by leave, withdrawn.
6.48 p.m.
On Question, Whether Clause 51 shall stand part of the Bill?
LORD HUGHES: There was considerable discussion about community councils on Second Reading. I think that the Minister said at that time that one of

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the reasons why community councils were in the form of not being another tier of the local authority was because they are to have the maximum amount of freedom. It was not to be laid down what they might do or might not do. First of all, I should like to ask a question. On the answer to it depends where I go. Clause 51(2) says:
"… and to take such action in the interest of that community as appears to it to be expedient and practicable."
Does the fact that what the community council may do or may not do is not defined mean they have complete freedom to do anything that appears to them to be expedient and practicable in the interest of that community?—because that would appear to be what flows from what was said on Second Reading. Would the noble Lord, Lord Polwarth, be good enough to answer that simple question? On the answer to it depends my next question.
LORD POLWARTH: As I understand it, the freedom will be complete within what is considered expedient and practicable for that council.
LORD HUGHES: The freedom will be complete. In that case I cannot understand the answer that the noble Lord gave to the noble Lord, Lord Tanlaw, when he asked whether a community council would be free to give free milk to children in their area. The answer was that they would not. If they can do anything they consider expedient in the interest of their community—and obviously it is perfectly reasonable for them to say that it is expedient to give free milk to the school children of the area of the community council and it is a simple matter to arrange its distribution, so it is obviously a practicable proposition—on what ground did the Minister answer Lord Tanlaw that it would not be permissible for them to do that? That is the second question.
LORD POLWARTH: I will see whether I can do better on this one. Have freedom of action, yes!—but not so as to usurp any function reserved for some other body. Certainly, my first reaction on that question of Lord Tanlaw was that this was a function statutorily laid down, as I understand it, and therefore it should be reserved to those bodies. I suppose that theoretically it would in
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this case be possible, if they had sufficient funds; and, of course, they have to acquire the funds. I suppose in theory they could produce a scheme for the distribution of free milk if they could raise enough money, but I doubt whether they would get the funds out of the district council or the regional council.
LORD GARNSWORTHY: Why not?
LORD POLWARTH: Because those bodies would probably feel that that was a function covered in other ways.
LORD HUGHES: By no means. After all, the country is full of local authorities which wanted to continue to give free milk. They were prevented from doing so by the Government. The councils stopped doing it, but not because they wanted to, and they have tried various means to get round the Government's decision with limited success for limited periods. There is nothing in the Bill which says that the community council cannot do things which are within the power of the district council or the regional council to do. It is anything which appears to be "expedient and practicable". The Minister says, "Yes, it would be theoretically possible for them to give free milk, if they could get the money." If you have a district council which wants to give free milk it will be only too ready, if that is the only way to make it possible, to put these funds at the disposal of the community council.
I am not raising this point in order that on Report the Minister may introduce restrictive powers on community councils. But I think it right to point out that either they have freedom, as the Minister has said, to do anything they like, and for which they can raise the money, or they are restricted in some way. Undoubtedly it is the case that the Government have, over a period, interfered with the functions which local authorities may undertake, in the sense of saying that local authorities may not do certain things which hitherto they have been able to do. In this the Government may be giving the opportunity to these councils to do the thing at second hand. I am not raising this because I want to stop the possibility, but I am pointing out that this would be the wrong way to do it and that the Government may be making it a perfectly legal

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way to do it. I can think of at least half a dozen district councils in Scotland who would be delighted to take the opportunity of making funds available for the distribution of free milk to any community council which wished to do the job.
LORD POLWARTH: I can only say that the noble Lord, Lord Hughes, has opened up a fascinating new field of possibilities. I would need to inquire further into this matter about the exact limitations and communicate with him. I cannot say precisely what limitations could be imposed.
LORD HUGHES: I did not intervene in respect of the community councils because I have no great enthusiasm for community councils. I doubt very much whether they will be able to do the sort of job that people think they may do. They may be no more than glorified tenants' associations. But if they are capable of doing the job it will be because the Government are giving them real powers and putting real money at their disposal from the district and regional councils. Either the Government want them to be bodies with power to do these things, or they must re-think the matter. My real objection to community councils as they are in the Bill is that I do not think the idea has been thought out at all. They are a kind of unknown kind of animal which has not appeared in local government life before, and if it were left in this way they might turn out to be the most powerful bodies of them all, provided that the district and regional councils were prepared to find the money, because it is the nearest approach to general power given to a local authority which appears in the Bill.
THE EARL OF SELKIRK: I am wondering whether the noble Lord, Lord Hughes, is not greatly overstating the case. Suppose a community council wanted to run a brothel. Is the noble Lord saying that there would be no objection to rates being raised in order to put money at the disposal of a community council to run a brothel, or a gambling hall, or anything else? Surely, there would be an objection to that. It is carrying the thing too far.
LORD HUGHES: No. Running a brothel, so far as I know, is against the law. I have never tried it.
THE EARL OF SELKIRK: Giving free milk is against the law.
LORD HUGHES: It is not against the law. It is illegal for town and county councils to give free milk. There is nothing in the present legislation to say that a community council cannot give free milk. The embargo is on existing local authorities.
THE EARL OF SELKIRK: Therefore it is raising money for an improper purpose.
Clause 51 agreed to.
House resumed.

NATIONAL INSURANCE AND SUPPLEMENTARY BENEFIT BILL
6.55 p.m.
THE MINISTER OF STATE, DEPARTMENT OF HEALTH AND SOCIAL SECURITY (LORD ABERDARE): My Lords, I beg to move that this Report be now received.
Moved, That the Report be now received.—(Lord Aberdare.)
On Question, Motion agreed to.
Schedule 4 [Amendment of Schedule 2 to Ministry of Social Security Act 1966]:
LORD ABERDARE LORD ABERDARE moved as an Amendment:
Page 16, line 42, leave out paragraphs (d) and (e).
The noble Lord said: My Lords, this Amendment seeks to reverse the decision which was taken by this House at the Committee stage last Thursday. On that occasion an Amendment in the names of the noble Baroness, Lady Phillips, and the noble Lord, Lord Avebury, was carried against the Government by one vote in a small House. This Amendment seeks to restore the provisions of the Bill as they were originally introduced into this House. I should like to try to explain as clearly as I can why we wish to stick to our original proposals. We are not being in the last bit mean or grudging; very much the reverse. We are in fact

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giving additional help to a particular class of people who need it most, and we are not reducing the present scale of assistance to anybody else. To try to make this clear may I begin by briefly sketching the historical background.
Before 1966, the National Assistance Board had power to consider on their merits individual claims for extra help in exceptional circumstances. This meant that inquiries about special needs had to be made in every case which often caused embarrassment to the applicant. Moreover, the fact that special additions were given at the discretion of the officer dealing with the case resulted in a considerable lack of uniformity, and entailed some instances of unfairness for the applicant. It was therefore entirely to the credit of the then Labour Government that in 1966 they introduced the long-term addition. This was designed to avoid these individual investigations, except in very particular circumstances, by paying a flat-rate addition to all those, apart from the unemployed, who were in receipt of long-term supplementary benefit. So that the majority of claimants under the new scheme had an entitlement to an allowance covering their special needs instead of having to depend on the discretion of the officer concerned to get what they needed.
When it was first introduced in 1966 the rate was 9s. This figure was chosen because it was roughly the equivalent of the average amount awarded for special addition before 1966. This 9s. was to cover, so far as possible, the extra requirements of long-term recipients of supplementary benefit, including extra heating needs, extra diet, extra laundry and other exceptional needs. Only when a person's exceptional circumstances required more than 9s. was it necessary to make a special investigation, and possibly an extra payment. But in any such case, of course, it followed logically that the 9s. already allowed for extra needs had to be taken into account, and any extra requirement was paid over and above the 9s. This has been the system which has operated ever since. It was operated by the Labour Government and is operated now by the present Government; although the portion of the long-term addition available to meet special expenses has now been increased
1232
to 50p, and for those over 80 years to 75p. But there has been no change in the administration of these exceptional circumstances additions. They have been calculated in full, and the long-term addition already paid to meet exceptional circumstances has been offset against the total.
Now if we come to this Bill, we are making one small but very significant change in order to help a particular priority case; namely, those who require extra heating. Your Lordships will know well that we have been under considerable pressure to help those in need of extra heating for a long time, both in the two Houses of Parliament and by such organisations as the Child Poverty Action Group and Age Concern. Now that is just what we are doing. We are allowing those with heating needs to receive their extra addition without offsetting it against the long-term addition.
I acknowledge that this is of course illogical, but it is a very special effort to help with the cost of heating, and it certainly should be welcome to all your Lordships. In fact, no one has criticised us for making that concession, but it has stirred your Lordships to demand that we make even more concessions. The Amendment which was carried last Thursday by one vote would compel the Supplementary Benefits Commission to make this same concession in respect of those who receive exceptional circumstances additions for special diets or for laundry. Since these, together with heating, form the bulk of the special needs for which provision is made, the Commission would in effect be providing twice over for most special needs—once in the long-term addition, and again by means of special additions made on top of it. Moreover, in a sense the Amendment would put the clock back, since, just as in the days before 1966, all claimants would once again be dependent on the discretion of the local officer to ensure that they got their full entitlement. This we cannot accept.
We believe that heating has a priority of its own and that we are justified in making an exception in that case. In cases where a very special diet is required the Supplementary Benefits Commission always make proper provision on medical advise. They also have full flexibility to make such additions as they

1233
consider appropriate in other cases; for example, in the case of laundry. The concession that we are making in favour of those with heating needs we estimate will help about 400,000 people at a cost of approximately £6 million; but of course this is a figure which it is difficult to estimate, and it may be considerably more.
LORD PLATT: My Lords, would the noble Lord forgive me for interrupting, because I am not quite sure of one thing he said a few seconds ago. Did he say that full provision was made for the diet on medical advice?
LORD ABERDARE: Yes; that is precisely what I said. I said that where a doctor recommended a very special diet —and there are cases, such as those with kidney failure—then the full amount of what the doctor says is required for the special diet is allowed by the Supplementary Benefits Commission. But of course there is set against it the extra amount the person is already getting from the long-term addition.
My Lords, I was saying that the concession we are making in favour of those with heating needs will help some 400,000 people and will cost about £6 million; but it will depend what the needs are shown to be, and the costs will vary according to the needs. But to add on, as some of your Lordships wish, those who need extra diets or extra laundry additions would cost something in the region of another £10 million. We do not think it right to incur this extra expenditure, given the fact that the Supplementary Benefits Commission already have discretion to consider exceptional individual cases. When the noble Baroness, Lady Phillips, spoke last week she implied—I am sure it was done inadvertently—that while retirement pensioners were to get an extra £1, longterm recipients of supplementary benefit might get 10p more, or perhaps nothing at all. This of course is not right. Longterm recipients of supplementary benefit will receive the same increases as retirement pensioners, and it is only amounts additional to that for exceptional needs with which we are concerned in this Amendment.
BARONESS PHILLIPS: My Lords, may I interrupt? That is, I am sure inadvertently, linking two unlike things. I
1234
did not refer to the flat rate increase; I was referring to the long-term allowance and to the exception.
LORD ABERDARE: My Lords, I am glad it was inadvertent, because if the noble Baroness reads her speech, at column 920, she will see that perhaps she gave another impression. I just want to make it clear that the supplementary benefit people will be getting their £1 just as the ordinary retirement pensioner does.
My Lords, in total, this Bill brings large extra benefits to those who are most in need, including, at a cost of £6 million, additional help to those who need extra heating. We are going far further than any previous Government have gone in this respect, and I do not think it reasonable that your Lordships should force us to go any further at the present moment. I confidently recommend this Amendment to the House, and I hope that my noble friends on this side will support the Government in making this one very significant concession to those who need extra heating next winter. I beg to move.
7.6 p.m.
BARONESS PHILLIPS: My Lords, I should like to thank the Minister for his careful explanation of what is, as we all appreciate, a rather complicated matter. I will not detain your Lordships for long; I never believe in repeating arguments. Though the Minister said it was a thin House last week—and that is quite true—I think it had one particular quality; namely, that everybody present on that occasion was genuinely interested, asked questions and really seemed to follow the whole of the debate. So while it might have been less in quantity, it was very high in quality—and by that I do not imply in any way that that is untrue this evening, as no doubt we shall see later. I rest my case purely on this point. The Minister said last week, rather sadly, that when he came to bring more we then asked for still more. I do not in any way decry the additional help which this Bill will give. I have only four sums here with which I will not weary your Lordships, but when they are added up, if there is only the one allowance offset, these people will not receive any more on their extra benefit. They will receive the £1, but so will everybody else. It

1235
seems to me that we are slightly confusing the long-term allowance, which, as I understand it, was never intended to cover diet or heat. The Minister shakes his head. Perhaps it is laid down.
LORD ABERDARE: My Lords, I am sorry, but it certainly was.
BARONESS PHILLIPS: As I understood it, when I carefully read the regulations, it was intended to cover replacements, shoe repairs and things of that kind. The heating allowance came under the exceptional circumstances. But be that as it may, it seems to me that, whatever explanation we give and however kind and sympathetic we are, if at the end of the day somebody who has hitherto received £1·10 still only receives £1·10, then he or she is not going to get any more on his extra benefits. I think we can see this very clearly in the examples of two elderly couples, living side by side. One couple, in relatively good health, will be receiving their extra long-term allowance, but because they are both fit and not in need of the exceptional circumstances allowance, as the other couple are (where the husband has had a stroke and is totally incontinent) the first couple will get the heating allowance offset and the second couple will not. Therefore, even though the first couple receive the pound and the second couple also receive it, the second couple will still get less—and they are the people who, being sick, will need it more.
On this side of the House, my Lords, we are not suggesting that this Bill does not bring help. It does bring help to all pensioners and it brings extra benefit to those who are already in receipt of benefit; but it still leaves out many people—people, as I said to your Lordships last week, who are very sad people, those right at the end of the scale. If somebody is over 80, is ill and has very little money, he needs the maximum to stay in one place. I should like to say once again that if they need a high-protein diet, a steak costs the same for them as for any of your Lordships. However we work out the sums in the Bill, when we get down to actual figures there will be some people who will not receive any more. Therefore I am sorry, but I cannot support the Amendment which is before us this evening.
7.12 p.m.
BARONESS MASHAM OF ILTON: My Lords, it seems extraordinary to have supported an Amendment which is now part of the National Insurance and Supplementary Benefit Bill and now to be speaking against another Amendment which is meant to undo the good work which your Lordships did last Thursday evening. What is the point of a Bill coming to your Lordships' House and going through the different stages if your Lordships, many of whom have great experience in these matters, cannot make suggestions on how to improve the Bill? With the multitude of legislation which has recently passed through both Houses, is it not possible that Members of another place may not have had time to consider fully the importance of giving this very small extra help to people who, after all, are already on supplementary benefit?
To take the least important item first, I should like to stress, as I did on Committee stage, that good food helps to keep people out of hospital and thus saves the country money in the long run. If a person's haemoglobin drops too low, they are likely to develop pressure sores which will cause a considerable extra cost to an already overworked nursing service. People on extra diets, as the noble Lord has already said, are catered for. In this case, why worry about taking them out of the Bill? They are ill people.
At the Committee stage, I thought the heating and laundry allowances should have equal priority, but now, because of the Amendment which we are considering, I have had to give it more thought. I hate to be cold, but I hate even more to have to sit in wet clothes or sleep in a damp, clammy bed. At least if one has a dry bed and is cold it is possible to go to bed with a hot water bottle and keep warm. I therefore feel that the extra laundry allowance heads my list of priorities. There is nothing more depressing than a pile of soggy laundry. If there is 50p available, it is possible that someone (even if there is no home help available) might take the laundry down the road to the launderette. If there is no 50p, after weeks of good will, the situation may end with the incontinent person giving up his or her struggle for freedom and going into an institution.

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The noble Baroness, Lady Elles, feels so strongly about this that she has written to the Prime Minister.
I had to go home to Yorkshire last night. I drove 240 miles here this afternoon and shall drive another 240 miles back to-night; but at least I shall have had the satisfaction of having voted against this Amendment. This Government have done a great deal to help people who will be affected by this Bill, and they can take great credit for it. But there was a Government survey, compiled by Amelia Harris, which came out two years ago. It gave a great deal of information about the appalling conditions many elderly and disabled people throughout the country were living under. With this information, any Government have a duty to continue to do something about it. I have often opened a newspaper and read about the right honourable Sir Keith Joseph having said that he recommends people to stay living in the community as long as possible. Today, we are talking about a group of people who cannot live in the community with the rising costs, unless they have increased financial help for these vital services.
LORD AIREDALE: My Lords, I should like to echo the opening words of the noble Baroness, Lady Masham. I hope that the Minister, when he comes to reply, will explain to us why the normal and dignified procedure is not being followed in this matter. Surely the normal, dignified procedure is that this Bill, having been amended in this House, should be sent to the other place as amended and that the Amendment should be considered in the other place. No doubt the careful argument which the Minister addressed to us just now would be addressed to Members of another place, and it may be that they would decide to disagree with your Lordships' Amendment. Then the Bill would come back to your Lordships and, on all known form, your Lordships would not insist upon their Amendment.
Instead of that, what is the situation that is presented to us now? The Government are taking a course which, if they are successful, will achieve the position that the House of Lords came to a decision last week and are going to come to an opposite decision this week. Is
1238
that not a situation after the Devil's own heart?—if the Devil is one who would not be sorry to see the demise of the House of Lords. Would this not then enable people to say: "What does the House of Lords really think? Is it what they said last week or is it what they have said this week? Or is it that the House of Lords does not really know what it thinks and has really nothing to offer?" I am fond of your Lordships' House. I come here on most days, and I am jealous of the reputation of your Lordships' House. I think it is a sorry day when a Conservative Government sets out on a course which, if successful, will tend to bring the House of Lords into disrepute.
7.18 p.m.
LORD PLATT: My Lords, I tend to be one of those who is a little influenced by a logical argument, though I do not think logical arguments should govern us in every possible case. I can of course see the arguments of the Government in this case, as they were very ably put over by the noble Lord in his introduction. His point, or the Government's point, is that the supplementary allowance has been given and people spend some of that on food, heat and laundry; therefore, if you are going to give extra, some of that extra should be deducted because you have already given them a supplementary allowance. The noble Lord went on to say—and I questioned it just to make quite sure that he really did say it—that if, on medical advice, a diet were to cost a patient something extra, and presumably it was assessed by an hospital dietician, full provision was always made. I have actual evidence—and I think the noble Baroness, Lady Phillips, had evidence—that in many cases this is not true. I do not know of any case in which it is true, but I have not been into a large number of cases and I may he wrong over this. What happens as a rule is that the diet is assessed as costing £3, £4 or £5 a week, or whatever the sum is. Then the authorities say, "We will give you £3 towards the diet". It will probably cost £4. Already a deduction has been made; but on top of that another deduction is being made. I do not believe the argument holds water. I said so when we discussed this matter only a few days ago. I cannot accept the argument that this

1239
would be providing twice over for the same need. If that argument is defeated, I do not think the Government have any arguments left on which to stand.
I agree, after giving careful thought to what the noble Baroness, Lady Masham of Ilton, has said—and she told me about it beforehand, so I have had more than just two or three minutes to think about it—that the laundry need is most important. For most people, fortunately, it is not one of the essentials of life. Most of us manage one way or another to get some washing done. But for the people who really need it, the people who are incontinent and so on, who are old, who cannot do their own laundry, this is one of the greatest needs. I come back to another point which I made. Is this not a foolish situation? How will the people look at it? Whatever the logical arguments may be, they will say, "You give us a benefit and immediately you take something away from us. If we are over 80, you take 50 per cent. more away from us than if we are under 80." Can you really imagine a Government putting that forward and expecting to get votes on it? I cannot, though that is the least of my arguments. In view especially of what the noble Lord, Lord Airedale, has said, I hope that this Amendment will be withdrawn.
7.23 p.m.
LORD ABERDARE: My Lords, I have listened to what has been said in the debate, and I should like to answer one or two points. I should like to make it clear to the noble Baroness, Lady Phillips, that no-one is any worse off. This Bill does not take anything from anybody. There may be, as there always is with any provision, some who stand to benefit more than others; but there is nobody who is worse off, and probably 400,000 people are better off at a cost of £6 million. There may be cases—
BARONESS PHILLIPS: My Lords—
LORD ABERDARE: I am sorry, I want to finish my sentence—where a person is getting more than one extra exceptional circumstance addition, where the set-off arrangements mean they will not be getting any more. These are special cases. If there are cases of hardship the Supplementary Benefits Commission can always review them. The flexibility is
1240
there; but the general provisions of the Bill are more for those who need heating allowances.
The noble Baroness, Lady Masham of Ilton, made an eloquent plea, but her picture of people sitting in damp, clammy beds is not realistic because they can get all that they need from the Supplementary Benefits Commission. If they have exceptional laundry needs these are met. The only point I am arguing on is, as has been the case since 1966, in order not to have a mass of small claims, everybody has their long-term addition of 50p which is to meet these needs. If the needs are greater than that, they can get extra. This seems perfectly fair to me; it has been the system which has been working since 1966.
BARONESS MASHAM or ILTON: If they get it, why not have that in the Bill?
LORD ABERDARE: Because they would be getting it twice: the long-term addition to meet the needs, and getting it on ton of that. That is the point. My Lords, I do not agree with the noble Lord. Lord Airedale; I thought his was a very unrealistic approach considering that all through the past three years that I have been on this Front Bench we have done nothing but repeat at Report stage Amendments that have been moved and carried one way or the other at Committee stage. When there is an Amendment like the particular Amendment we had at this Committee stage, which was only carried by one vote in a small Committee, I see nothing wrong with asking your Lordships to reconsider the matter. This happens the whole time in another place.
LORD SLATER: My Lords, may I ask—
LORD ABERDARE: My Lords, I must get on; but perhaps a quick question from the noble Lord.
LORD SLATER: The noble Lord emphasised the point that this Amendment had been carried by one vote. Is he aware of the statement made in another place by an ex-Member of the Cabinet of the Tory Government, to the effect that if they were returned to power and they had a majority of only one in regard to denationalising the steel industry, they would denationalise the steel industry?
LORD ABERDARE: My Lords, that is another matter. If the noble Lord, Lord Airedale, thinks back even so far as a Bill not dissimilar to this one—the Social Security Bill—the noble Lord, Lord Raglan, moved an Amendment at Committee stage, and he lost it by one vote. It came back again at Report stage when it was considered again, and he lost again. The fact that he lost again does not alter the fact that one can always reconsider at Report stage a decision that has been made at Committee stage.
LORD AIREDALE: My Lords, what I asked the Minister to answer was why the Bill had not been sent to the other place for them to consider the Lords' Amendment. I hope that we shall not be told that it is because of lack of Parliamentary time, because I hope always each House of Parliament would do the courtesy to the other of giving time to consider any Amendment to any Bill introduced in the other House.
LORD ABERDARE: My Lords, I accept what the noble Lord is saying.
The point is that this House should send its balanced decision back, not a decision made by one vote in a small Committee.
BARONESS SEROTA: My Lords—
LORD ABERDARE: I will not give way any longer. We must get on, my Lords. This is a Report stage of a Bill and I am speaking to this Amendment.
I would only say, finally, that this Bill brings massive benefits to many people. It makes one particular concession to 400,000 people who need extra heating, at a cost of £6 million. It takes nothing away from anyone; it continues the sensible practice of a long-term addition to cover the normal extra needs of long term beneficiaries, but leaves the Supplementary Benefits Commission flexibility to meet extra needs in excess of that long-term addition.
7.29 p.m.
On Question, Whether the said Amendment shall be agreed to?
Their Lordships divided: Contents, 93; Not-Contents, 44.

CONTENTS

Aberdare, L.

Eccles, V.

Monck, V.

Ailwyn, L.

Elliot of Harwood, B.

Mountevans, L.

Albemarle, E.

Elton, L.

Mowbray and Stourton, L.

Aldenham, L.

Essex, E.

Napier and Ettrick, L.

Aldington, L.

Ferrers, E.

Nelson of Stafford, L.

Alport, L.

Fortescue, E.

Nugent of Guildford, L.

Amherst of Hackney, L.

Fraser of Lonsdale, L.

Pender, L.

Atholl, D.

Gainford, L.

Penrhyn, L.

Balerno, L.

Goschen, V.

Polwarth, L.

Balfour, E.

Gowrie, E.

Reay, L.

Barnby, L.

Grenfell, L.

Reigate, L.

Berkeley, B.

Gridley, L.

Rockley, L.

Brabazon of Tara, L.

Grimston of Westbury, L.

St. Aldwyn, E. [Teller.]

Brecon, L.

Harris, L.

St. Helens, L.

Brooke of Cumnor, L.

Hylton-Foster, B.

Sandford, L.

Brooke of Ystradfellte, B.

Inchyra, L.

Selborne, E.

Cawley, L.

Kemsley, V.

Selkirk, E.

Coleraine, L.

Kilmarnock, L.

Sempill, Ly.

Colville of Culross, V.

Lauderdale, E.

Sharples, B.

Conesford, L.

Limerick, E.

Strathclyde, L.

Cork and Orrery, E.

Lonsdale, E.

Strathcona and Mount Royal, L.

Craigavon, V.

Lothian, M.

Croft, L.

Loudoun, C.

Stratheden and Campbell, L.

Cromartie, E.

Lucas of Chilworth, L.

Sudeley, L.

Cullen of Ashbourne, L.

Lyell, L.

Tenby, V.

Daventry, V.

McFadzean, L.

Tweedsmuir, L.

Denham, L. [Teller.]

Macleod of Borve, B.

Tweedsmuir of Belhelvie, B.

Derwent, L.

Mancroft, L.

Vivian, L.

Digby, L.

Mansfield, E.

Ward of Witley, V.

Drumalbyn, L.

Merrivale, L.

Windlesham, L. (L. Privy Seal.)

Dulverton, L.

Milverton, L.

Young, B.

Ebbisham, L.

NOT-CONTENTS

Airedale, L.

Balogh, L.

Blyton, L.

Auckland, L.

Beswick, L.

Boothby, L.

Bacon, B.

Birk, B.

Burton, L.

Champion, L.

Hoy, L.

Segal, L.

Chichester, L. Bp.

Hughes, L.

Serota, B.

Davies of Leek, L.

Jacques, L.

Shackleton, L.

Foot, L.

Janner, L.

Shepherd, L.

Gaitskell, B.

Llewelyn-Davies of Hastoe, B.

Slater, L.

Garnsworthy, L.

Longford, E,

Strabolgi, L. [Teller.]

George-Brown, L.

Maelor, L.

Taylor of Gryfe, L.

Gladwyn, L.

Masham of Ilton, B.

Taylor of Mansfield, L

Granville of Eye, L.

Phillips, B. [Teller.]

Wade, L.

Greenway, L.

Platt, L.

Wise, L.

Henderson, L.

Raglan, L.

Wynne-Jones, L.

Henley, L.

St. Davids, V.

On Question, Amendment agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.
Then, Standing Order No. 44 having been suspended (pursuant to the Resolution of July 12):
7.36 p.m.
LORD ABERDARE: My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3a.—(Lord Aberdare.)
LORD AIREDALE: My Lords, we now have a situation in which on a particular matter, on a particular Amendment, your Lordships decided last week in one direction, and at Report just now in the opposite direction. I do not know whether it is usual for a Bill to be read a third time immediately after a Report stage in which an Amendment has been made. In any event, I should have thought it was only a courtesy to those noble Lords who are not able to be present this evening to have time in which to consider the two conflicting decisions that your Lordships have come to within a week upon this matter. I would therefore suggest that your Lordships do not support a Motion for the Third Reading of this Bill this evening.
LORD ABERDARE: My Lords, it is on the Order Paper and was agreed through the usual channels that we should take the Report and remaining stages this evening, and that seems to me to be perfectly fair and logical. On the other point which the noble Lord makes, I am not sure whether it is out of order or highly irregular to move again on Third Reading an Amendment which has been voted upon at Report stage. I remember this question in the case of debates we had on the boundary between Somerset and Avon. But I would suggest to the House that as we have agreed to this matter and this Bill is a very urgent
1244
one and brings massive help to a great number of pensioners and other people, really we are behaving in a perfectly normal manner.
LORD SHEPHERD: My Lords, could the noble Lord give an indication of when the Government expect to receive the Royal Assent to this Bill, because this of course is material in the light of what the noble Lord, Lord Aberdare, has said in regard to the importance and the urgency of this Bill. I think—and no doubt the noble Earl the Chief Whip would agree with me—that there have been occasions on Third Reading when Amendments have been moved and voted upon despite the fact that they have been moved and voted upon in Report. Some noble Lords who take a fairly strong view upon this matter might not wish to move an identical Amendment but might wish to consider the consequences of this evening's vote on Report, to see whether there was a possibility of bridging a gap—I do not know.
On the question of the "usual channels", I suppose that as Deputy Leader of the Opposition I am part of them, although I was not involved in the actual discussion. I think the position is that where there is agreement by the usual channels it must always be with the consent of the House at the end. The usual channels can only decide what is suitable as they see it in the interests of the House. It is for the House itself to decide whether the proposals that the usual channels have put forward are in accordance with their wishes.
I have not participated in this debate, but I think in some respects there is a case made by the noble Lord, Lord Airedale. We have changed the Bill at the Report stage and it may be that some noble Lords may wish to have an opportunity during the Third Reading debate to explore the possibility of some bridging

1245
position. I wonder whether the noble Lord, Lord Aberdare, would accept a Motion moved by the noble Lord, Lord Airedale, so that we could delay the Third Reading until Monday of next week. If the Royal Assent is not being taken to-morrow I should not think the Government would lose any particular time in relation to this Bill.
LORD ABERDARE: My Lords, I really do not think we ought to postpone it in that way. It is very unusual. I have before me the paragraph in the Companion to the Standing Orders, which says
"It is considered undesirable that an amendment which has been fully debated and decided upon on the previous stages of a Bill should be moved again on Third Reading".
There really is no halfway house between us on this particular matter. The noble Lord was not here when we debated it. It is a perfectly simple issue. There were two Amendments standing in the name of the noble Lord, Lord Avebury, originally. One of them was defeated and the other, which was the compromise Amendment, was the one on which we have just voted, so we have no bridge left. I suggest that this is an important Bill which will be of enormous help to a number of people; we are on a very narrow point, and I suggest that the House may decide to give it a Third Reading.
LORD SHEPHERD: My Lords, can the noble Lord answer the question: when does he expect the Bill to receive the Royal Assent?
EARL ST. ALDWYN: My Lords, if this Bill is to come into operation in October it is essential that it should receive the Royal Assent before the two Houses rise. We cannot have Royal Assent with only one House sitting.
LORD SHEPHERD: My Lords, that would be in two weeks' time.
EARL ST. ALDWYN: No, my Lords, next week. If we were to postpone it we could not take the Third Reading before Monday—we could not possibly take it to-morrow—and if an Amendment were moved and carried it would be virtually impossible to get the Bill back to the Commons, the Lords Amendment considered by the Commons, then back to us
1246
for further consideration of the Commons probable disagreement with our Amendment, and get the Royal Assent. As my noble friend has said, with the benefit that this Bill is giving, it must, if the recipients are to get that benefit, come into operation in October, and it seems to me that that is more important than trying to have further discussion on this one particular point.
On Question, Bill read 3a, and passed.

ELECTIONS (WELSH FORMS) REGULATIONS 1973
7.45 p.m.
LORD STRATHCONA AND MOUNT ROYAL LORD STRATHCONA AND MOUNT ROYAL moved, That the Elections (Welsh Forms) Regulations 1973, be approved. The noble Lord said: My Lords, these regulations touch on an important form but they involve no new principle, and I am happy to say, perhaps for the first time to-day, that they are not a matter for controversy. The form they prescribe is the basic canvass form which is issued to all householders each autumn as the basis for the preparation of the electoral register. The form was first prescribed in Welsh in 1965 under the Elections (Welsh Forms) Act 1964. The Welsh Language Act 1967 provided for the use of bilingual forms (or, as the Act expresses it, forms partly in Welsh and partly in English) and in consequence a bilingual Form A was prescribed in 1970 (in the Elections (Welsh Forms) (No. 5) Regulations 1970). This was the bilingual version of the revised English form prescribed in 1969.
The present regulations follow a minor revision in the English form which was approved by your Lordships' House on March 5 last. The change was consequential on the change in jury service effected by the Criminal Justice Act 1972. A column was added to Form A to enable those over 65 to be marked as ineligible for jury service, and this bilingual form prescribed by these regulations reflects this change. The changes are minor, and in essence the prescribed bilingual form is the same as that prescribed in 1970 which has been in use in Wales for the last three years. This has not been the subject of any complaint to the Home Office or to the Welsh Office. However, when these regulations were

1247
being considered in another place, mention was made of numerous grammatical and other errors in the Welsh translation. We have looked into this and I am advised that in the printing of the Statutory Instrument there are nine printers' errors in the Welsh text. I naturally apologise for this on behalf of the Department concerned, but I am assured that these errors will not occur in the forms actually distributed at the canvass this coming autumn.
As regards the correctness of the Welsh used, the translation is basically that made some years ago by a distinguished Welsh scholar. Of course translation can never be an exact science, and a true assessment of its success in a particular case can only be a matter of opinion. Nevertheless, my right honourable friend the Secretary of State for Wales has been concerned about the criticisms which have been raised and he has arranged for the translation to be considered by the advisory panel which he consults on these matters, and this panel will be meeting next week. In the meantime, I express the hope that your Lordships' House will approve these regulations, in order to allow the appropriate form to be used in Wales this year in connection with the electoral register and the new arrangements for jurors. I beg to move.
Moved, That the Elections (Welsh Forms) Regulations 1973, be approved. —(Lord Strathcona and Mount Royal.)
LORD CHAMPION: My Lords, we have to congratulate the noble Lord, Lord Strathcona and Mount Royal, on his first appearance at the Box. We are delighted to welcome him here to that Box and also to congratulate him on his elevation to the post of a Lord in Waiting. His is not exactly a Welsh name—but neither is mine, so I cannot complain of his actually moving this Motion that we now have before us. This Motion is for a Statutory Instrument to be made under the 1967 Welsh Language Act, which in my opinion made an outstanding advance in bringing about the use of the Welsh language for legal and official purposes.
I support what an honourable friend of mine said in the other place when he paid tribute to the way in which both Governments, since the passing of the
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1967 Act, have maintained the flow of translation. This has been going on to the satisfaction of Welsh-speaking people in Wales. I was going to complain a little of the translation, not because I know a great deal about it but rather because I consulted my honourable friends in another place who happen to be scholars in the Welsh language and they pointed out to me some of the errors. But I accept the point from the noble Lord that alterations are to be made and that when finally the election form is issued, it will be issued in a style which will be reasonably accurate and the translation will be such as to be acceptable to Welsh scholars. I could not very well have criticised the translation because I must admit I have to rely on my wife to translate the Welsh news for me. She unfortunately is quite often in the position of not understanding what the North Walians seem to be saying on television; but that is a matter of slight differences of language as between the North and the South.
My Lords, there is little else I need say, except to welcome the regulations as another earnest of the Government's intention to carry out both the letter and the spirit of the Welsh Language Act 1967. May I end by again congratulating the noble Lord upon his elevation. He has moved the Statutory Instrument which is before us, and I hope the House will accept it.
BARONESS WHITE: My Lords, I also extend a welcome to the noble Lord into the realm of Welsh affairs. With his usual courtesy, my noble friend Lord Champion has been too kind, because the criticisms in another place about this particular set of forms were really rather startling. I apologise for the fact that I did not realise that we were on this business so I was not able to hear the explanations of the noble Lord, but it is puzzling to me because under the last Administration we had in the Welsh Office a regular and highly learned body of persons, under the chairmanship of Professor Glanville Williams, in charge of the translations. Something seems to have gone awry.
LORD STRATHCONA AND MOUNT ROYAL: My Lords, the problem is nine printer's errors in the Welsh text, for which I felt it was essential to apologise,

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and I do so again now. I do not think there is any reflection on the scholarship of the translation.
BARONESS WHITE: My Lords, I am delighted to have that reassurance. I hope, now everyone has gone to so much trouble, that the forms will be used, because our experience has been that after the greatest care and labours from the panel of translators either these forms are often not made obviously available (one has to ask for them and go to extra trouble in order to get them) or those who shout the loudest in public take the least trouble actually to collect the Welsh forms and use them. This I find extremely discouraging, and I hope it will not be the fate of the particular form we are discussing to-night.

CONTROL OF ZOOLOGICAL GARDENS BILL [H.L.]
Read 3a, and passed, and sent to the Commons.

LOCAL GOVERNMENT (SCOTLAND) BILL
7.53 p.m.
House again in Committee.
Clause 52 [Schemes]:
LORD POLWARTH LORD POLWARTH moved Amendment No. 76:
Page 27, line 39, after ("elections") insert ("or other voting arrangements").
The noble Lord said: This Amendment is consequential to one accepted by the Government on Committee stage in another place to Clause 52(7). It was proposed at that time by the Opposition that the provision whereby a district or islands authority receiving a petition for the setting-up of a community council should be required to hold elections for the purpose within six weeks be amended to read "elections or other voting arrangements", to cover the case where some other way of choosing the council might be thought appropriate. As an example, there is the possibility in a remote area of some form of postal ballot. As a consequence of that Amendment made in another place, this Amendment is required. I beg to move.
LORD TAYLOR OF GRYFE LORD TAYLOR OF GRYFE moved Amendment No. 77:
Page 28, line 24, leave out ("30") and insert ("20").
The noble Lord said: It has been represented to me by several rural communities that the number of 30 ought to be reduced to 20. I think there is some substance in this suggestion, and from my own experience of setting up what must be the equivalent of a community council, a local amenities association, I recognise that in the initial stages a very small number of active and concerned people can be the basis of a healthy community council. It is not always evident at the beginning that a community council can be useful, but once a few people are convinced and once it is organised and has attained some interest locally, it can be set up. For these reasons I suggest that the number of 30 be reduced to 20.
BARONESS ELLIOT OF HARWOOD: I should like to support this Amendment. Living as I do in a rural area where it would not be easy to get 30 people to start a community council, I would suggest that the figure of 20 proposed by the noble Lord is a more realistic one. It does not apply in the urban areas where one has any number of people, but in large parts of Scotland, where I hope the community councils will be a valuable and effective form of assistance to the local council, it would be a pity to put in a figure which might be difficult to achieve and which would prevent the starting of the council. So I give my support to the noble Lord's Amendment.
LORD POLWARTH: In another place this subject was discussed quite exhaustively. To show the variety of opinion, I may say that one Amendment that was moved suggested reducing the number from 30 to 10 and another suggested increasing it from 30 to 100; so we have a wide range of views as to what is the appropriate number. The final view was that a minimum of 30 should be required to sign a petition. That would be the right number, so it should be allowed to stand. On the other hand, I appreciate that in the rural areas there may well be problems. One has to consider whether reducing the figure from 30 might make it possible for the formation in an urban

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district of a group that was not truly representative. I am quite open to persuasion on this matter. We have heard from only two of your Lordships, but if it is your Lordships' wish that the number should be reduced to 20, I do not think the Government would object. But if anyone else would care to comment, we should be glad to hear them.
LORD HUGHES: Coming from a totally urban area but where one does not have to go too far out of town before one is in a rural situation I can well envisage the circumstances my noble friend Lord Taylor of Gryfe indicated could arise. For instance, the number of people who have been added to the new district of Dundee from a very large part of the surrounding area will be widely dispersed. If one person is trying to organise this sort of thing and going round to find out who is in favour of it, it would be a troublesome business to get 30 signatures. As the noble Baroness, Lady Elliot, has said, in the more densely populated areas the difficulty will probably be to keep the number who want to sign it down to the figure. So I do not think the Government would be giving anything away over the greater part of Scotland if they did reduce the figure. It is perhaps in some of these sparsely populated areas that the community councils might serve the most useful purpose. I think the Minister would be well advised to accept the Amendment moved by the noble Lord, Lord Taylor of Gryfe.
LORD POLWARTH: As there appears to be no contrary view, I shall be happy to accept the noble Lord's Amendment.
8.2 p.m.
LORD TAYLOR OF GRYFE LORD TAYLOR OF GRYFE moved Amendment No. 78:
Page 28, line 28, at end insert:
("(8) Where a community council has been established it will be the duty of the Local Authority to advise the council in advance of any schemes or developments which may affect the environment in the area covered by the community council so that they may be given an opportunity of comment and advice.")
The noble Lord said: I should like to thank the noble Lord, Lord Polwarth, for accepting Amendment No. 77 and I can only hope that he will be equally accommodating on the Amendment which
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I now move. This Amendment suggests that the community council be advised by the local authority in advance
"of any schemes or developments which may affect the environment in the area covered by the community council so that they may be given an opportunity of comment and advice."
In an earlier discussions on this Bill reported in yesterday's Hansard, the noble Lord, Lord Polwarth, stressed the importance of community councils in giving advice to local authorities. We must establish that these community councils are important to the whole set up.
I perhaps disagree a little with the noble Lord, Lord Hughes, regarding the value of community councils. I think that particularly in the rural areas they will be very important because it is in this area that people see the reality of local government. District councils and regional councils may be fairly remote from them but community councils are part of their daily lives, and to make them meaningful it is important that schemes affecting the environment of these communities should at least be discussed by the community councils and that they be given the opportunity of advising on such schemes to indicate the local reaction.
This is very much in line with the Skeffington Report which laid great emphasis on the importance of the local community advice and involvement in planning decisions. I should think that the local community councils will have something to say in this field and I would regard it as enhancing the value of the community councils if they were so involved. My own experience in this field is in relation to local amenity councils under the civic trust where we reached an understanding with the local "county" councils that we would be advised in advance of matters affecting the environment in our village, and the local planning officer sought such advice and welcomed such advice although he did not always accept it. At least it gave the local community an opportunity of saying what they thought about certain desirable or undesirable developments in the area, and I would regard this as a useful addition to the legislation now before us.
THE DUKE OF ATHOLL: I should like strongly to support the noble Lord, Lord Taylor of Gryfe, on this Amendment. I

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think it is essential to the success of community councils to make them feel that they are doing a real job and this is one of the spheres where I feel they really could do a useful job of work and that their advice would be appreciated by the higher authorities—if I may describe them in that way. I hope that the Government will accept this Amendment, I feel fairly confident that even if this is not written into the Bill it will probably happen, but I think it will be better if it is written into the Bill.
LORD POLWARTH: I am grateful to the noble Lord for drawing our attention to what I think will be a very valuable function of community councils, but I am bound to doubt whether giving them a statutory right is the right approach. We are most anxious to give community councils the maximum freedom. I accept that at the present moment they are an unknown animal and we do not want to saddle them, at this stage at any rate, with statutory rights and statutory duties, and I think to single out this one for statutory treatment would, frankly, be a mistake. It would raise a number of difficulties, some of which are apparent from the wording of the noble Lord's Amendment, which says:
"… any schemes or developments which may affect the environment in the area covered by the community council …".
How would one describe exactly what issues?—because an enormous number of things can affect the environment if you take it literally. How far would the interests of the community need to be affected before consultation was required, and to what extent would consultation mean any action following the consultation? I think it would be better here to rely on common sense in relations between the district or regional councils and the community councils in this respect rather than saddle them with statutory rights—such a right of consultation which I am bound to say I do not think that even any statutory local authority enjoys in such a broadly worded and absolute form. For a body such as a community council this right would not sit happily with its voluntary status. Let us leave this to the good sense of local authorities in their dealings with the community councils in due course. It has been shown from experience in the Scottish Office that these
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requirements to consult with respect to legislation, to provide information in advance, sometimes make the body concerned as determined as possible to observe it to the minimum legal extent rather than to do it generously or wholeheartedly. While I entirely agree about the important function of the community councils, I would submit to your Lordships that the right way is not to saddle them with a statutory right.
LORD STRATHEDEN AND CAMPBELL: I should like to support my noble friend Lord Polwarth. I have stressed the importance of community councils since the first debate in your Lordships' House on the Wheatley Report and I am quite certain that they will work far more effectively if they are not restricted by statutory rights and statutory duties. Their object, in my view, has always been that they should be a completely detached form of organisation which will receive information from the local people and be able to pass that on without any real statutory duties at all. I strongly disapprove of the idea expressed by the noble Lord, Lord Hughes, that they should be used by the district councils in any way at all.
LORD HUGHES: That was not what I intended to speak about. I did not say that it was my idea that they should be used in that way; I was pointing out that as the Bill stood they could be used in that way, and I have no doubt that they might be. I did not express myself as necessarily being in favour of it, but for that matter I am not saying that I am against it either.
I would advise my noble friend not to press his Amendment. I thought the noble Lord was going to finish up in the way that Ministers in every Government so often do, by saying, "As soon as you start to particularise you put the general in danger". As we have established by Clause 51 that community councils are going to be the most uninhibited bodies in local government, I would be very much averse to any form of particularisation which might place this wide general power in danger. I therefore hone that my noble friend will accept that there is nothing in the Bill as it stands which will prevent the community council getting this information, and it would not really rest on the district council telling them

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of anything that happened. After all, if it is something which is likely to worry them, some or other of the members of the community council will get to hear in ample time for something to be done about it. So let him not, in wishing to help the community councils, take away from the possibility that they can be even more powerful than he thought, and therefore as useful as he thinks they are going to be.
THE DUKE OF ATHOLL: I am not sure I agree with the noble Lord, Lord Hughes. I think the trouble may well be that community councils may not get to hear of developments taking place in their area, particularly when they are being carried out by people like the Gas Board or the Electricity Authority. I think there are defects in this particular provision and I hope the noble Lord, Lord Taylor, will not press it. But a provision such as this would I think be very useful in the Bill. If there is not going to be such a provision, I would hope that my noble friend will assure us that his Department will send a circular to district councils and regional councils to the effect that where community councils exist they should be kept very closely informed of development and planning applications in their area. I should be happy if my noble friend gave us that assurance. I think, however, that some such provision as this would be a great help to community councils in their work.
LORD TAYLOR OF GRYFE: In the light of the discussion which has taken place, I would not wish to press this to a Division, but would strongly support the suggestion of the noble Duke that some guidance ought to be given on the rights and responsibilities of community councils. I speak with some experience of a community council, so far as it is constituted as an amenity association, and it is not always the case that we are advised of substantial developments in our area. While this has now been regularised, sometimes there is reluctance on the part of the county council to advise local communities on important developments in their area. This has unfortunate consequences. It may set in motion ad hoc bodies which may be unrepresentative and sometimes irresponsible. I think it would be far better if these matters were channelled through com-
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munity councils. This would provide a reasonable forum for discussion and thus avoid these complications. But in view of the sympathy shown by the general view of the Government, I would not propose to press the Amendment. I beg leave to withdraw the Amendment.
LORD POLWARTH: I am quite sure that, by whatever manner, these things will be called to the attention of those concerned with the setting up of these councils. Schemes have to be submitted to the Secretary of State, and I am quite certain this aspect will not be overlooked.
Amendment, by leave, withdrawn.
Clause 52, as amended, agreed to.
Clauses 53 to 55 agreed to.
8.15 p.m.
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 79:
After Clause 55 insert the following new clause—
Community Council Officers
(".—(1) Every district or island council shall appoint a clerk and such other officers as they think necessary, for the efficient discharge of the functions of any community council established under this part of this Act and may pay to the clerk and such other officers appointed under this section such reasonable salaries as they think fit.
(2) The clerk and every other officer appointed under this section shall hold office during the pleasure of the district or island council.
(3) Nothing in this section shall be deemed to affect the provisions of any enactment or statutory order requiring the appointment of any officer for the purposes of that enactment or order.").
The noble Earl said: I will try to be as brief as I can, but this is something about which I feel rather strongly. I have attempted, unfortunately, to do two things here. One is to provide a sub-district office and the other is to provide the district council with some official who could attend to its ordinary running. I do not know whether any of your Lordships has been a member of clubs and societies and organisations, but so often the one and only paid member is the secretary. That is why I feel that this matter is important. I should like to go into a little further detail. I feel that, in future there will be just as great a need, if not a greater need, for the retention of the official known at present as

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the district clerk of a county council as there has ever been in the past, particularly when one realises that burgh councils disappear. If a community council does not have some official of that council to call the meetings, issue the minutes and deal with the correspondence, I cannot see that community council ever getting off the ground.
Your Lordships may not be familiar with the actual duties of a district clerk. Less than 10 per cent. of the work is taken up by the district councillors actually meeting. I therefore include a list of the duties of the Dunbar District Clerk, which I think serves as a typical example. In regard to the regional functions he calls the meetings of the education areas sub-committee and writes the minutes. He attends to irregular attendance and the procedure for dealing with school truancy; school lets; the assessment and recommendations under the school meals scheme; the assessment and recommendations for clothing and footwear in necessitous cases; the appointment of janitors, school cleaners; the payment of ancillary wages. On the area youth panel, he deals with applications for grants to youth organisations. With regard to the youth employment service, he keeps the employers vacancy register; he places people in employment; issues the National Insurance card and deals wtih the claims for unemployment benefit and social security payments; and he also makes up the returns to the careers officer. In the divisional health sub-committee, besides calling the meetings he deals with the assessment, administration, engagement, calculation and payment of wages of that marvellous organisation, the home-help scheme. He also acts as registrar of births, deaths and marriages, and does everything in that field.
I feel that there is a tremendous need for somebody to be available to do these duties. It is perhaps worth mentioning that his staff consists of only two girls in the office. But what concerns me most is the difficulty of dealing with school truancy, which is becoming an increasing problem; of the vital service under the home-help scheme and of necessitous cases being dealt with promptly. I cannot see people requiring that sort of help travelling maybe 50 miles to the new district council office,
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or possibly 100 miles to the new regional council office, to get attention. Perhaps I should emphasise that in future there will be no town clerk or burgh chamber-lain. So far as I know, every district clerk is expecting his office to wind up with the reorganisation of local government. Who is going to take his place? Will there be such an organisation? Can something be produced in the Bill to satisfy what I consider an urgent requirement? I beg to move.
LORD BALERNO: I should like to support my noble friend Lord Balfour in this matter. I think it is terribly important, if at all possible, to make a success of these community councils. The community councils are going to be of varying composition and operating in varying fields of activity. Some are going to be extremely active and some are not going to be so active. It is impossible to lay down exactly what should be the help that should be afforded them to get on with whatever their jobs and circumstances require. It is essential that they should be provided with some form of permanent staff to keep them going.
I am equally certain that the staff of the new district councils will normally be far too fully occupied to be able to attend to the community councils. I am not at all certain that it is desirable, in many cases, that an official from the district council should be seconded, as it were, for spare time work with the community council. That may well work in certain cases, but there is no doubt that in some of the community councils which are going to be extremely active there is going to be a job for a full-time person. In so far as the Amendment of my noble friend Lord Balfour makes this possible, I fully support it, and I hope that this will be the feeling of the Committee.
BARONESS ELLIOT OF HARWOOD: I am strongly in favour of the community councils having someone to work for them, but I do not think that any community council should deal with some of the things mentioned by the noble Earl. In my county, social services deal with meals and looking after old people, and the Education Committee deals with the truancy problem. What is being suggested that this person, or the community council, should do should be

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done by the statutory committee whose duty it is to look after education, social work, and all the other matters. I can visualise some things for the community council to do which are not the statutory duty of another committee. The community councils must have someone, and I hope that they will have a part-time secretary. But I deplore the suggestion that they should do the jobs that have been done, and should be done by the statutory committees.
LORD POLWARTH: I have sympathy with the noble Earl in what he is desiring to achieve by this Amendment, but I think that my noble friend Lady Elliot has produced the answer. This is not a matter for a statutory obligatory appointment of an official who would be in the pay, and at the pleasure, of the district council or islands council. They would have the complete whip hand over the actions of the community council, for whom we desire the maximum freedom.
The noble Earl referred to various functions which are not functions for a community council. They are laid down by Statute, and they are local authority functions. I do not think that the district councils need be remote. They have complete freedom to set up their own management structure and local offices, and I am quite sure that they will very often replace these previous district council offices with branch offices of the district council, where they can offer these services close to the people. It might very well be a good thing that the local community council office should share premises or be in an adjoining building, and the district council may make personnel and other services available to the community council. I submit that we will achieve the results much more effectively by leaving it to intelligent, voluntary arrangements of this kind.
THE EARL OF BALFOUR: May I say one word more. Many things, such as school truancy, have been dealt with at a very local level, and I am not satisfied with the work that the reporters are doing. They are wonderful and dedicated people, but I feel that very often the kind of social works organisation going on at the moment in the case of school truancy is so slow in getting anything
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moving that often the child has left school by the time that anything has happened. This is the sort of thing I want to nip in the bud. I felt that some local authority official of some kind was needed to deal with the long list that I read out, and that is what I wanted to happen. Provided that does happen, I am quite happy to withdraw this Amendment.
Amendment, by leave, withdrawn.
Clause 56 [Arrangements for discharge of functions by local authorities]:
8.25 p.m.
LORD HUGHES LORD HUGHES moved Amendment No. 80:
Page 30, line 28, at end insert—
(" ( ) A local authority may delegate to a committee or sub-committee any of their functions other than those which by this Act or any other enactment must be exercised only by the authority, and in case of such delegation subsection (4) of this section shall not apply.")
The noble Lord said: I think that this is a rather important Amendment, but I can be brief about it. It is really a probing Amendment more than anything else. I raised this point on Second Reading. The noble Lord, Lord Polwarth, was not able to deal with it in his reply, but he was good enough to write to me on a number of matters and this was one of them. If he will allow me, I will read what he said on this matter:
"I can confirm, as I indicated in my winding-up speech, that arrangements for the discharge of local authority functions under Clause 56 do cover the particular circumstances of delegation of powers to which you referred."
I am not certain that that is in fact right. Delegation of powers with local authorities can take two forms. There may be a particular subject and they may decide that the matter requires consideration. They may remit it, with powers, to a committee to take a decision on; that decision will be final, and that is a delegation of a particular item.
What I have in mind in connection with the delegation of powers is something very much wider than that, and something that is very widely practised by local authorities. They have a scheme of delegation under which, when a committee have taken a decision on a matter, it is final. Until the local authority reconsider their standing orders in due

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course—and that takes place normally once a year—the scheme of delegation cannot be altered. This happens very often, and I can give an example of the sort of thing that is in mind. On planning, for instance, in the Dundee Town Council—and I think it is typical of what is done in many local authorities—all decisions are delegated to the planning committees unless there is a division. If there is a division, but only then, does the matter then come to the full town council for decision
But in other committees, a wide range of ordinary business of the committee is delegated to them with full powers. When the minutes come up before the full meeting of the authority for consideration, items which are so delegated are marked with an asterisk, and there can be no debate on that in the council. This is generally accepted as being a means of cutting out needless delay in the carrying out of council decisions. I may say that the scheme of delegation in Dundee goes back to the time when Sir Garnet Wilson was Lord Provost towards the end of the war and in the years after the war. That was when it reached the form in which it substantially exists to-day, and it has worked admirably well.
The difficulty with Clause 56 is that it does not give delegation with powers. It says that they may be discharged by a committee. That can be delegation, but where it ceases to be delegation with powers is in subsection (4):
"Any arrangement made by a local authority or committee … for the discharge of any functions … shall not prevent the authority or committee by whom the arrangement is made from exercising those functions."
This simply means that nobody can act. There is no delegation in fact, because no committee can act on a decision that it arrives at because it would always be open for the meeting of the full authority to say, "We are going to decide this ourselves", so that delegation with powers would disappear. That is why my attempt at dealing with this was to say that where there was delegation with powers then subsection (4), giving the authority the right to take the matter back would not apply.
It will not surprise me in the least if the wording of my Amendment does not accomplish in proper draftsman's language what I want to do. I should be
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quite content to withdraw this Amendment if the Minister could assure me that he would look at this point, so that it is made clear beyond a shadow of doubt that a local authority may delegate a matter with powers, and a committee will know that those powers can safely be exercised and will not be withdrawn, or a decision overturned, at a subsequent meeting, except in the circumstances which I have indicated can be put into a scheme of delegation; for example, if a planning committee were divided and it was felt that a matter ought not to rest with them, because there should be a further opportunity of looking at it in the full authority. But if they were unanimous, that would be the end of the matter. That sort of case is not confined to a planning committee. A scheme of delegation might operate only where a committee were unanimous that the powers that were delegated would be operative. If the Minister will undertake to look at this point, and make the powers of delegation under Clause 56 wider than they appear to be, then I shall be content. I beg to move.
LORD POLWARTH: I do not think that the position is as restrictive as it seems to the noble Lord. As I understand it, this question of delegation can continue to be regulated, as I believe it is at present, by standing orders, and if standing orders say that a function is delegated without recall then it is so delegated until the standing orders are changed. The doubt may be over the use of the word "functions" rather than specific decisions, as it were. An authority can delegate with powers of decision under standing orders, and that remains the case until the standing orders are changed; and then, of course, they can take back the powers. This is a matter for the authority's own decision and regulation and it is not affected by Clause 56(4), which will not operate against an authority's standing orders.
LORD HUGHES: I should be happy with that if the Minister could tell me in what circumstances Clause 56(4) does operate.
LORD POLWARTH: Presumably, it would not prevent a local authority from taking back the delegated authority under the procedure laid down when it delegated the authority.
LORD HUGHES: It would not prevent their taking back the delegated power under the procedure laid down. If a local authority have a scheme under standing orders to delegate certain matters to a committee—and I agree that that is how it should be done—can the Minister assure me that the legal effect of Clause 56(4) would be overridden by the powers of the standing orders? If he can do that, I shall be perfectly content. I have never been committed to an arrangement, in any body of this kind, for more than a year at a time. Every year after the election the authorities will probably review the standing orders and they could change. But what I want to make certain about is that if a decision is taken and it appears to be a delegated one in pursuance of the decision which an authority has taken under the standing orders, a member will not be able to get up in Committee and say, "Notwithstanding the scheme of delegation in standing orders, according to Section 56(4) of the Local Government (Scotland) Act 1973 I have the right to raise this matter because it can be taken back". Will the Minister assure me that that will not be possible within a proper scheme of delegation?
LORD POLWARTH: Yes, it will not be possible without action being taken regarding the standing orders.
LORD HUGHES: I am grateful to the Minister. With that assurance, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD POLWARTH LORD POLWARTH moved Amendment No. 81:
Page 32, line 11, leave insert (" 1973").
The noble Lord said: Amendments Nos. 111, 172 and 201 are consequential on this Amendment. These Amendments are consequential on the passing of the Education (Work Experience) Act 1973, which received the Royal Assent on May 23 this year. That Act becomes part of the body of Education Acts which may be cited together. It is therefore necessary that we amend the description of these Acts from "1939 to 1971" to "1939 to 1973". At the same time, the opportunity is taken to make a minor drafting Amendment in Clause 233(2), where two Education Acts are at present
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specified. It seems preferable to cover them all by employing this formal embracing citation of the Acts from one year to the other. I beg to move.
Clause 56, as amended, agreed to.
Clauses 57 to 63 agreed to.
Clause 63 [Appointment, etc. of staff]:
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 83:
Page 36, line 7, leave out paragraph (e).
The noble Earl said: Clause 64 is a curious clause because of the choice of the specified officers that a local authority must appoint. It is also curious to find the variations in the terms and conditions of their appointment in the Schedules to this Bill. For example, a local authority must appoint a qualified weights and measures inspector, but there is no mention of either the appointment or the terms and conditions of the very important official known as the sanitary inspector or the environmental health officer because Section 79 of the Local Government (Scotland) Act 1947 is being repealed. Hence my new clause.
LORD POLWARTH: I wonder whether I may interrupt the noble Lord. I think the Amendment called was No. 83, was it not?
THE DEPUTY CHAIRMAN OF COMMITTEES (LORD CHAMPION): Yes, Amendment No. 83 to Clause 64 by the Earl of Balfour.
THE EARL OF BALFOUR: I thought I was speaking to that.
LORD HUGHES: I also thought the noble Earl was speaking to that.
LORD POLWARTH: With great respect, I think that the noble Earl is speaking to the subsequent Amendment in his name.
THE EARL OF BALFOUR: Amendments Nos. 83 and 84 go together. We are now on No. 83, to leave out paragraph (e).
BARONESS ELLIOT OF HARWOOD: It has nothing to do with environmental health.
THE EARL OF BALFOUR: I am giving my reasons why I want to leave out paragraph (e). I do not think I have made a mistake. A director of social work can neither be appointed nor be dismissed except with the sanction of the Secretary of State, under Section 3 of the Social Work (Scotland) Act 1968. Under Section 36 of that Act, social work reporters are at present appointed or dismissed under the same conditions as their director, but it will be noted that under Schedule 26 to this Bill these conditions are being repealed. Hence the reason for my Amendment to leave out paragraph (e). If it is the intention of the Government to specify that a local authority must employ reporters, why have the Government decided not to specify the appointment of any of the officials in the Local Government (Scotland) Act—Section 76, clerk; Section 77, treasurer; Section 78, collector; Section 79, medical officer of health and sanitary inspector; and Section 80, road surveyor. At the same time, I should like to point out that although directors of education must be appointed under Section 86 of the Education (Scotland) Act 1962, under Schedule 11 to this Bill they
"… shall hold office on such reasonable terms and conditions, including conditions as to remuneration, as the authority appointing him think fit."
The special conditions mentioned in the rest of that subsection cease to have effect. Yet teachers at the authority schools will continue to have these special conditions of employment. I therefore ask: is this alteration in the best interests of either the officials or the authority concerned? I beg to move.
LORD POLWARTH: I think there is a small degree of confusion here. The noble Earl's Amendment relates to the office of reporter under the Social Work (Scotland) Act 1968. We have specified here a number of offices which it will be obligatory to continue. In general, our policy is to give the maximum freedom to local authorities, and not to oblige them to maintain more than the minimum necessary offices designated by their titles. We will leave it to their discretion how they designate the people to carry out the jobs. But this particular one is in a rather peculiar position, and I shall
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confine my remarks to this because this is the substance of the Amendment.
The office of reporter was introduced as a carefully independent part of what is really quasi-judicial machinery. The reporter's duties as the permanent official servicing children's panels include very important powers like deciding which children referred to him by the police, social work departments or individuals as having committed offences or as having been in difficulties seem to require compulsory care. The decision as to who come before a children's hearing is the reporter's alone, and it is most important that his independence is manifest. The only way of ensuring this is to provide that a reporter has specifically to be appointed, and that his functions cannot be absorbed, for example, within those of the clerk to the authority, the director of social work or any other official. That is the purpose of requiring the maintenance of the office of reporter, which the noble Earl's Amendment would remove from the Bill.
THE EARL OF BALFOUR: I beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
Clause 64 agreed to.
8.44 p.m.
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 84:
After Clause 64 insert the following new clause—
Environmental Health Officer
".—(1) Every district and island council shall appoint an officer who shall be called the environmental health officer of the district or island authority and shall regulate the duties of the environmental health officer and pay him such reasonable salary as the council may determine.
(2) Except with the sanction of the Secretary of State no person shall be appointed environmental health officer of an authority unless he possesses such qualifications as may be prescribed by the Secretary of State.
(3) The environmental health officer of an authority shall not hold any other appointment or engage in private practice or employment without the written consent of the council.
(4) The environmental health officer shall hold office during the pleasure of the council, so however that he shall not be removed from office except by either a resolution of the council passed by more than two thirds of the members of the council present at a meeting of the council the notice of which specifies the consideration of the removal from office

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of the environmental health officer as an item of business or by or with the sanction of the Secretary of State."
The noble Earl said: I have already spoken to this Amendment. It is either necessary or it is not necessary, but I feel that the environmental health officer is in very special circumstances. The environmental health officer could be placed in a difficult position, and I feel that he should be in some way covered by Statute. I beg to move.
LORD POLWARTH: I think this is a fairly clear, straightforward difference of view as to whether or not it is necessary to have an official designated by his particular title. The environmental health officer is, of course, our old friend the sanitary inspector under his newly-chosen designation. He is a very important person, but I do not think he enjoys such a special responsibility or position as to require that he must statutorily be designated as the environmental health officer by every authority. I think that here, as with these other appointments, unless there is something specific (like the reporter, who was mentioned in the last Amendment), we should leave it to the good sense of the authorities concerned how they designate these officials. They will have to employ people with these skills to deal with the functions with which they are charged, and there will be many opportunities for the people with these present designations for employment with the new authorities. They will indeed have even better opportunities, I submit, than they have at present in their careers. Accordingly, in the interests of leaving the maximum freedom to authorities about the designation of their officials, I would ask your Lordships to resist this Amendment.
LORD HUGHES: I think the Minister is right in this case. I doubt very much whether any local authorities which have needed sanitary inspectors in the past are going to refrain from appointing them just because it is not laid down. I agree with the Minister that these are very important officials of local authorities. In fact, I would go further and say that they are even as important as their new title would indicate.
THE EARL OF BALFOUR: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clauses 65 to 69 agreed to.
Clause 70 [Acquisition of land by agreement]:
On Question, Whether Clause 70 shall stand part of the Bill?
LORD HUGHES: I have a query on Clause 70. This clause states the way in which local authorities can acquire land, and I presume that under the usual arrangements "land" includes anything which may be on it—buildings, and so on. In the past it has been a great thorn in the flesh of authorities that they can acquire land only after a value has been placed on it by the district valuer. This means that in many cases they have had to wait sometimes two years before they can do so. I do not see anything in Clause 70—though I would not guarantee that it does not appear somewhere else in the Bill—requiring that a local authority will acquire land only after the district valuer has valued. I do not think it is in the clause, but would the Minister say whether or not these restrictions still apply, or whether this is part of the giving of greater powers to local authorities?
LORD POLWARTH: The noble Lord has caught me out on this one, without notice.
LORD HUGHES: I would be quite happy if we left it at that, and perhaps the noble Lord could be a little out of order in giving us the information later on.
LORD POLWARTH: If the noble Lord will allow me that opportunity, I will gladly accept it.
Clause 70 agreed to.
Clauses 71 to 75 agreed to.
Clause 76 [Special provisions as to land acquired for public recreation from heir of entail]:
8.48 p.m.
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 87:
Page 40, line 42, leave out ("quarter of a mile") and insert ("100 metres").
The noble Earl said: I took legal advice on this Amendment, and I was told that the heirs of entail enactments were 19th century Acts which applied to property which was entailed before 1914. The quarter of a mile was in connection with what was regarded as a

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reasonable distance from the point of view of privacy. At that time people really felt that a quarter of a mile was the minimum distance. I well remember one case of relations of mine who acquired a house that had five huge monkey-puzzle trees planted close round about it, and a Virginia creeper and ivy which had been trained to grow up the walls. Nowadays, with the open-planning type of house, I feel that the distance of 100 metres in substitution would be quite far enough away, and a much more practicable thing—and we are trying to make things more practical by the provisions of this Bill. I beg to move.
LORD POLWARTH: The noble Earl is taking us back into some rather obscure legislation. He is right in saying that no entails have been created under Statute in Scotland since 1914. Nevertheless, I do not think it would be right that your Lordships should tamper with what is really a basic part of the law of entail. This is something which I think we may well want to review as a whole in the appropriate way at the appropriate time. The noble Earl would in fact, by his Amendment, reduce the radius of inalienable land from one quarter of a mile to 100 metres. Apart from going metric, he would be reducing the radius to approximately a quarter and the area to one-sixteenth. The number of occasions, if any, when this will arise is minimal. I would suggest that anything to do with this should be left to the review of the whole of the law of entailment.
THE EARL OF BALFOUR: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 76 agreed to.
Clauses 77 to 80 agreed to.
Clause 81 [Contracts of local authorities]:
On Question, Whether Clause 81 shall stand part of the Bill?
LORD HUGHES: I do not think I shall catch the Minister this time. I ought not to. The clause starts by saying:
"A local authority may make standing orders with respect to the making of contracts by them or on their behalf."
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It goes on to say that they
"shall make standing orders with respect to the making by them … of contracts for the supply of goods or materials or for the execution of works".
I take it that what the first part means is that a local authority might be making a contract for some sort of service other than that dealt with in the second paragraph (for the supply of goods and materials or for the execution of works); for instance, contracts with architects, surveyors, lawyers and so on. Is it the intention that where contracts do not fall within subsection (2) the authority may still make standing orders, but where it falls within subsection (2) they are under an obligation to make standing orders and they are covered by the following provisions? Am I reading it correctly?
LORD POLWARTH: That is certainly how it appears to me. The first is a general permissive power, the second is more detailed and specific with relation to entering into specific contracts and works and that they must have standing orders with respect to specific kinds of contracts for the supply of goods or materials or the execution of works. They may have more general ones overall.
Clause 81 agreed to.
Clause 82 agreed to.
Clause 83 [Power of local authorities 'to incur expenditure for certain purposes not otherwise authorised]:
LORD POLWARTH LORD POLWARTH moved Amendment No. 88:
Page 44, line 17, leave out ("a Lord Provost").
The noble Lord said: This Amendment and Amendment No. 89 go together. They are being proposed following an undertaking given by Ministers in another place at Report stage to consider further classes of persons sponsoring appeals which might be assisted by a local authority under the powers of the clause. At the moment subsection (3) provides that a local authority may contribute under it to appeals sponsored by
"a Lord Provost, a chairman of a regional, islands or district council, a lord-lieutenant or a body of which any of these persons is a member".
I am not quite sure how a lord-lieutenant can be a member of a body of persons, but it is apparently all-embracing. The term "Lord Provost" as provided in

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Clause 3 will continue to attach to the chairmen of the city districts of Aberdeen, Dundee, Edinburgh and Glasgow, but the Government made it clear that while they did not intend to extend the title by Statute to other office holders there was nothing to prevent its use elsewhere; for example, by a district council or a community council. There could also be the possibility in some areas that local councillors might wish to provide for the title to continue to be borne by someone other than the chairman of the district council.
To avoid confusion, we feel that the words "Lord Provost" should be deleted from the clause. In the case of cities the position will be covered by reference to "a chairman of a district council", which is what the Lord Provost will be in the cities. It was also agreed to accept a suggestion originally put forward in another place that local authorities should also have power if they wish to contribute to appeals sponsored by community councils, and the reference to the chairman of a community council has been inserted in this Amendment.
LORD HUGHES: I agree with the Minister that these words should be taken out in view of the reference to a chairman of a district council, but my agreement arises from a different reason. The way in which the noble Lord expressed this view multiplies my fears that the Government are prepared to contemplate with equanimity the possibility of Scotland being littered with Lord Provosts.
LORD POLWARTH: I beg to move Amendment No. 89.
Amendment moved—
Page 44, line 18, after ("council") insert ("a chairman of a community council").(Lord Polwarth.)
Clause 83, as amended, agreed to.
Clause 84 [Powers of local authorities with respect to emergencies or disasters]:
On Question, Whether Clause 84 shall stand part of the Bill?
LORD HUGHES: I wonder whether the Minister can tell me what this power covers. Would it cover, for instance, the
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conditions that arose in Glasgow some years ago when with exceptional storms a tremendous amount of damage was done and for a long time there was doubt as to the power the local authority had to carry out repair work and subsequently to recover the cost from the owners of the property? That was how it was eventually done, but after long and needless delay was incurred. I think that largely the legal advisers to the Corporation of Glasgow did not think they could do this. This clause would make it clear in circumstances of that kind that the local authorities have the power to get on with the job right away. Is that the position?
LORD POLWARTH: That is what is envisaged: that it should cover emergency and disaster involving danger to life or property—some physical event but not a continuing eventuality or state of affairs.
Clause 84 agreed to.
Clause 85 agreed to.
Clause 86 [Insurance by local authorities against accidents to members]:
On Question, Whether Clause 86 shall stand part of the Bill?
LORD HUGHES: The question is raised by NALGO as to whether this clause is sufficient in requiring insurance by local authorities against accidents to the members and whether it ought not to be extended also to ther officers or employees. The opinion I expressed (but I am not certain I am right) is that it would not be necessary in their case because it will be provided in the ordinary course of events. Part of the conditions of service is that these people are protected against the consequences of accidents. That is not the position in relation to members, where it can be done only by insurance and special arrangements. Am I right in my opinion?
LORD POLWARTH: The position, as I understand it, of the officers is the normal employer-employee relationship. As such, the industrial accidents provisions in National Insurance legislation should adequately take care of the officers. There is nothing to prevent special arrangements for special officers, so far as I know, under the Bill.
LORD HUGHES: If an authority wanted to make up an employee's wages for a period, as is done by any good employer; if they wanted to make up the industrial benefits to his normal wage or to insure against that contingency, presumably they are free to do so without any specific power being laid down in the Bill?
LORD POLWARTH: Without being absolutely certain on that, from what I have heard of the arrangements I should have thought this to be a normal employer-employee situation in which the employer would have power to make any reasonable arrangement regarding the insurance of his employee.
LORD HUGHES: As the noble Lord is not absolutely certain, may I ask whether if the position is different he would be good enough to write and let me know? If I do not hear from him I shall know that the position is satisfactory.
Clause 86 agreed to.
Clauses 87 to 90 agreed to.
Clause 91 [Social, cultural and recreative activities]:
9.0 p.m.
THE DUKE OF ATHOLL THE DUKE OF ATHOLL moved Amendment No. 90A:
Page 48, line 19, leave out ("an adequate") and insert ("a reasonable").
The noble Duke said: The terms of this subsection occur in several places in the Bill and in most of the other places I think that they are perfectly suitable. But I am worried in connection with this clause which deals with the provision of recreational and social facilities. It is almost impossible to produce adequate facilities for social, cultural or recreational activities at times of peak demand. However many golf courses there may be, probably on Sunday mornings there will not be an adequate number. I should have thought it was unreasonable to expect any regional authority to produce this number of facilities. I am worried also that on some occasions various recreational activities will conflict. Thus you may have a pond which is used for water ski-ing and for fishing, which two sports cannot take place at the same time. Is the regional council to be expected to produce adequate facilities for both
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sports? It is the word "adequate" that worries me.
If there were a demand for ski jumping in some towns (I might add that every Scandinavian town of any size has its own ski-jump and I do not think the day will be far off when every town has one, with sports getting more and more international) would the regional council be expected, at great expense, to produce a ski-jump and supply adequately the demand for that particular recreational facility? I imagine they would be expected to produce bigger and better State bingo halls if the demand for accommodation for bingo was not satisfied by the existing halls. I feel that in this subsection it would be better if the word "reasonable" was used rather than the word "adequate". I am not prepared to go to the stake over this; I am not even prepared to divide the Committee on it. But I feel that here the use of the word "adequate" goes perhaps too far, and that "reasonable" might be a more appropriate word.
LORD POLWARTH: I think we would all agree that both these words, "adequate" and "reasonable", are capable of a pretty broad interpretation and at first sight there is a lot to be said for the noble Duke's suggestion. If there were ever to be any question of challenging a council on whether they had fulfilled their duties under the clause I think the real criterion would be whether they had tried to do their best in the circumstances. I should think it very unlikely, but if the matter ever became one of a legal definition, I should think it would be easier to enforce it over the term "adequate" than over the term "reasonable". I am sure that the interpretation of adequacy will be dealt with in a sensible manner.
THE DUKE OF ATHOLL: If my noble friend is satisfied that this is not going to cause difficulty, who am I to complain? I am still not entirely convinced, but I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD TAYLOR OF GRYFE LORD TAYLOR OF GRYFE moved Amendment No. 91:
Page 48, line 21, at end insert ("and shall report to the Secretary of State annually on the steps taken particularly in relation to the provision of parks and recreation facilities.").
The noble Lord said: This Amendment follows representations made to me by the Institute of Parks and Recreation Administration, a body for which I have the highest regard. They are a little concerned about some of the facilities not being adequate. I think the balance between district and region is clearly and sensibly defined in the Bill. There will be parks and recreation facilities which are essentially district, but more and more the provision of country parks will have a regional impact and responsibility. The park administrators and the recreation administrators were a little apprehensive about the wording in Clause 91 which says:
"A local authority may do or arrange …"
and it gives a list of the facilities which they may provide. I confess that it would be wrong to make these facilities compulsory and to insist on the maintenance of a band, orchestra or theatrical company. At the same time, it is felt by people who are concerned with outdoor activities that something stronger might be expressed in relation to parks and recreation.
I think that we are all deeply concerned about the mounting cost of vandalism in areas where school leavers who have been accustomed to enjoying some organised recreational facilities and some order in their school life, suddenly find themselves in a new world, a new environment of factory life, where facilities for recreation are inadequate. I think there is a duty to provide adequate recreation, even as an insurance against the increasing menace of vandalism. We make compulsory certain services by local authorities. I admit that there are difficulties about making this facility compulsory, but I think that for many local authorities the budget for local parks is more and more being taken up by the provision of a little landscaping here and there on new housing estates; and there is little money left for the additional responsibility of providing adequate recreation facilities.
We are living in a period in which vandalism is the result of frustration felt by people who can find no outlet for their creative energy. I hope that the Minister will be able to say something which might encourage those of us who are concerned over this matter, and that
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in particular the Institute may be encouraged to feel that their particular and important social responsibility is not being lost sight of in the new legislation. I beg to move.
THE DUKE OF ATHOLL: I think it might be for the convenience of the Committee if I speak now rather than on the Amendment that I have put down to Clause 138, Amendment No. 135A, which is on much the same point, and if I say straight away that I was never enamoured of my Amendment and much prefer that of the noble Lord, Lord Taylor of Gryfe. I am afraid I have not his skill in thinking of Amendments. I feel that this is a very good compromise between the two evils: first, forcing local authorities to spend their money in some particular way, which is something, like the noble Lord, Lord Taylor of Gryfe, I would tend to deplore; and secondly, that in times of financial stress the first thing that is always cut out is expenditure on things like parks and recreation areas. I feel that expenditure on outdoor places where people can go and enjoy themselves is well worth while in the fight against vandalism. I therefore hope that the Government can give us some encouragement by saying that they adopt the spirit of this Amendment, if not the actual words.
The Institute of Park and Recreation Administration are slightly worried by the somewhat dual responsibility that this Bill lays on the regional councils and the district councils for the administration of parks. They realise that regional parks, like Culzean, ought to be a regional function, and that smaller parks in the heart of Glasgow ought to be a district function, but they feel that there may be some falling between the stools. I should like my noble friend to confirm that the Government will keep an eye on this.
LORD POLWARTH: I can confirm that it is the Government's intention to give every encouragement to the provision of this kind of facilities. It is encouraging to read that,
"regional councils shall have a duty in consultation with district councils …"
This is a definite provision to ensure that there is an adequate provision of facilities for the inhabitants in their regions for social, cultural and recreational activities I think these activities will all benefit

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from the fact of having a stronger regional structure, with greater resources, and better able to plan the proper distribution and allocation of these facilities, instead of possibly every very small community striving to have every facility and ending up not having a good enough one anywhere. I think the regional set-up will enable us to make a much better provision than in the past, and that is certainly our intention.
On the actual substance of the Amendment, which suggests that they shall report to the Secretary of State annually on the steps taken, with great respect I do not think this is the right answer. We do not want to increase the number of statutory annual reports that have to be made. Everybody then bustles around and says, "What are we going to put in the annual report?", and they think up all sorts of odds and ends to fill it out. Under Clause 199 of the Bill the Secretary of State is given power to require any local authority, joint committee or joint board to submit such returns and give him such information as he may require. So I think the Secretary of State can keep a good eye on this. He has the power to do so, and we certainly intend to give every encouragement to this end.
LORD TAYLOR OF GRYFE: I should like to thank the noble Lord for that assurance and for the encouragement he has given. In the circumstances, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 91 agreed to.
Clauses 92 and 93 agreed to.
Clause 94 [Capital expenses]:
9.13 p.m.
LORD HUGHES LORD HUGHES moved Amendment No. 91A:
Page 50, line 18, after second ("works") insert ("or to such amount")
The noble Lord said: The two Amendments that I have put down to Clause 94 look the same, but they are not. They cover different aspects, and I speak only to Amendment No. 91A. On Second Reading, I pointed out that one considerable source of anxiety to local authorities is the fact that every item of capital expenditure is controlled, and they have to go to the Secretary of State for consent, no matter how small it may
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be. I appreciate that it is part of the functions of central Government to control the use of the resources of the country and that one of the ways in which this is done is by tight control of capital expenditure. I do not wish materially to depart from that. However, I suggested on Second Reading that it might be appropriate, in the spirit of giving more powers to the new local authorities than are available to the existing ones, that the Government might consider the possibility of either an aggregate amount for local authority expenditure, not exceeding some small sum—I would not care to put a figure on it—which might in fact be generally approved by the Secretary of State without requiring the submission to him of details. I looked at the clause as it stood and it seemed to me that it might be possible to regard paragraph (1)(a):
"subject to such conditions as may be specified …".
as enabling the Secretary of State to say that any scheme which does not cost more than £x is given approval in this way. Regarding paragraph (1)(b)—
"in relation to such project, or to such programme of works, or to such class of works …"
I do not know, for instance, whether it might be said that schemes costing not more than £x could be regarded as a "class of works".
If, therefore, the wording of the clause as it stands would enable the Secretary of State to give a general authority of this kind, then I should be content. All I would seek to do—and the Amendment which I have put down is only if it is thought necessary—would be to lay down such an amount so that the Secretary of State could say that any scheme costing not more than such an amount could be gone ahead with, and there would be general authority for him to do that. But I am taking it generally really as a permissive power, so that the Secretary of State "may" do this, and, whichever way it was done, the Secretary of State would not be under any obligation—because in times of stringency he might want to pull the reins tight, but at other times he might be able to give a general dispensation of this kind. Would the Minister be good enough to say whether the clause as it stands would enable the Secretary of State

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to regard a scheme of this kind as coming within the powers which the clause gives?
LORD DRUMALBYN: It is doubtful whether the clause as it now stands would allow the kind of permission that the noble Lord seeks. On consideration, we think it is desirable that there should be such a power, and therefore I am happy to accept the Amendment, though, like the noble Lord, Lord Hughes, I should not care to put a figure on it.
LORD HUGHES: I am grateful to the Minister.
LORD HUGHES LORD HUGHES moved Amendment No. 91B:
Page 50, line 23, leave out ("or are to be met from a reserve fund").
The noble Lord said: This Amendment, although it refers to the same clause, is quite a different thing. I am rather unhappy about the way the clause is worded, because subsection (2) says:
"In this section 'capital expenses' means any expenses which are to be charged to a capital or borrowing account, …".
No one could dissent from that: a charge is obviously a capital expense. It continues:
"… or are to be met from a reserve fund, or are to be met otherwise than out of current revenue."
Presumably if they are not to be met out of current revenue they are to be met by using borrowed money, and presumably again it is a capital expense.
What I am not happy about is the inclusion of the words:
"or are to be met from a reserve fund,".
I could understand the position if what is intended is that what is obviously a capital project which could otherwise be met by borrowing money was in fact going to be met from a reserve fund; but as I read this clause it says that any expense which is being met from a reserve fund shall be regarded as a capital expense. There may be many things which are met from a reserve fund. The most obvious occasion is if there is a deficit on the current year's accounts and therefore the local authority take money out of a reserve fund to meet it. But on a strict reading of this clause they would be debarred from doing so, because as soon as they take
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money out of the reserve fund it becomes a capital expense, and they can do it only with the consent of the Secretary of State. I am quite certain that that is not what is meant.
If I am told that, notwithstanding that being an intelligent reading of the provision, this is what the lawyers would make it out to be and that it is confined to preventing the use of reserve funds on proper capital expenditure, then I should be content. But if I cannot be assured of that, the least I am prepared to do is to invite the Minister to look at this clause again and ensure that it does only what it is intended to do: that is, prevent a reserve fund from being used for capital expenditure that otherwise would have been controlled by the Secretary of State.
9.20 p.m.
LORD DRUMALBYN: I think I can clarify the intention here for the noble Lord. As he has appreciated, the basic object of Clause 94 is to ensure the control of the use of resources through the control of capital expenses, instead of through the control of borrowing. Reserve funds are in general derived from revenue contributions. But if they are built up they can be used to fund quite large capital projects—which of course means a take up of resources. It is exactly this take up of resources that it is intended to control. Moreover, paragraph 60 of Schedule 9 removes the 2½p limitation on aggregate contributions by local authorities to capital funds in any year. In view of these two considerations, it is not unreasonable to include expenses met from reserve funds in the definition of capital expenses. The noble Lord will have noticed that the end of that sentence says "or are to be met otherwise than out of current revenue". So there is the distinction there between what is to be met out of current revenue, and what is to be charged to capital and the like. There will need to be some flexibility in operating Clause 94, and local authorities will normally be free to spend within the limits of their agreed capital budgets. Where capital expenses are being incurred, or reserve funds are being employed simply to acquire existing assets rather than to create new assets, it should be possible to make some relaxation of control, and again there is no creation of new assets.

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I hope I have made the position clear. There was some reference to this in correspondence that passed between my noble friend and the noble Lord. I hope that I have made the purpose of these particular words clear. Plainly, if funds are merely to be paid out of the reserve fund to meet what is normally funded out of current revenue, whether it is a deficit or anything else, this does not come within the meaning of capital expenses. That is clear from the subsection. What we are talking about here is the spending of money for the creation of new assets. It is on this point that we seek to exercise control.
LORD HUGHES: I am sorry, but I am not satisfied. I do not think the noble Lord, Lord Drumalbyn, has met the point I am raising. I am in complete agreement with the object he stated and which was in Lord Polwarth's letter to me. I would not wish to be a party to giving an unlimited freedom on capital expenditure if people were free to use reserve funds. Some local authorities could have large reserve funds—Edinburgh at one time had enormous reserve funds; we do not know how enormous because the figure was never revealed. We all know there was a lot of money involved.
But it is a fact that in Clause 94(2) capital expenses are being defined. The definition includes the spending of any money from the reserve fund as being considered a capital expenditure. It is much more common to use reserve funds for items which are not of a capital nature at all; yet as I read this, as soon as you take money out of a reserve fund it becomes a capital expenditure. That is what I am seeking to prevent. I want the Minister to make it perfectly clear that reserve funds will not be used for expenditure of a capital nature without the consent of the Secretary of State. To that I have no objection. What I am objecting to is the way in which capital expenditure is being defined. I would be content to withdraw this Amendment; it may well be that there is an answer to it, but I have not received it so far and it is a little late to press the matter too much. I should be happy to withdraw the Amendment if the noble Lord, Lord Drumalbyn, would look into the matter and write to me to assure me of the adequacy of this provision, or if it is not
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adequate to say what is to be done about it.
LORD DRUMALBYN: I shall be happy to look at the point. It is a question of the definition of capital expenses for the purposes of this clause. I shall look at it very carefully to see that the intention is adequately expressed in these words.
LORD HUGHES: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 94, as amended, agreed to.
Clauses 95 and 96 agreed to.
Clause 97 [Establishment of Commission for Local Authority Accounts in Scotland]:
9.26 p.m.
LORD POLWARTH LORD POLWARTH moved Amendment No. 92:
Page 52, line 5, after ("Commission") insert ("with such associations of local authorities as appear to him to be concerned and with such other organisations or persons as he may think appropriate").
The noble Lord said: We come now to the clauses of the Bill dealing with the provisions for audit and particularly the establishment of a Commission for Local Authority Accounts in Scotland. Since this is an innovation, before moving the first of these Amendments, I think I must say a little about this new set-up because I know that certain of your Lordships are interested in this. At present, the audit of local authority accounts is carried out by what the Local Government (Scotland) Act 1947 calls " fit persons " appointed by the Secretary of State. These " fit persons " are, in fact (I am delighted to hear it) practising accountants holding a recognised professional qualification—and I am sure that it will please my noble friend Lord Strathclyde behind me to know that he and I are presumably both qualified to be called "fit persons". The work of carrying out something like 500 audits is spread fairly thinly over a large number of firms, and the system has long been felt to suffer from two main drawbacks.
In the first place, it does not encourage specialisation in public accounting

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matters, which are indeed very specialised, or the provision of adequate central guidance on, for example, new legislation, and it involves the Secretary of State to an unnecessary extent in administrative matters such as appointments, fee fixing and dealing with reports on irregularities, many of them of a fairly mundane kind. The provisions of these clauses are intended to remedy these defects. They have been discussed with, and I understand welcomed generally by, the profession as represented by the Institute of Chartered Accountants of Scotland, the Local Government Auditors' Association (representing those accountants holding audit appointments) and the local authority associations.
We propose to appoint a Commission for Local Authority Accounts, which we hope will be seen to represent the joint interests of local authorities and of the public—those who spend money on local services and those who provide it. The Commission will take over nearly all the Secretary of State's present functions in securing the audit of local authority accounts and the consideration of audit reports. They will be supported by a chief official, the Controller of Audit, and other staff. They may arrange for auditing to be done either by their own staff or by accountants in public practice as at present. The Controller of Audit will co-ordinate and guide the work of the auditors and will be responsible for reporting to the Commission on matters arising from the accounts.
The Commission are to consider all reports made to them and will be empowered to hold hearings and make recommendations. They will have no executive powers to recover illegal payments, losses or deficiencies. Any recommendation they make at all for recovery from a councillor or official will have no effect unless it is confirmed by an administrative order of the Secretary of State, and this gives the opportunity for anybody affected by such recommendation to make his own representations before any order is made. Apart from the final discretion thus vested in him, we do not intend that the Secretary of State should be involved, as he now is, in determining issues of fact and law which may arise on an auditor's report.
Coming now to this Amendment, it is the essence of the new arrangements that the Commission should be independent. However, we thought it right to include a long-stop provision—this is well precedented—against the unlikely possibility of the Commission adopting a course of action which is clearly not in the public interest. In another place representations were made that we should add words to this clause to make it clear that the power of general direction resting with the Secretary of State should only be exercised with regard to the Commission after consultation with those having an interest in the work of the Commission. Such consultation would normally take place, of course, but the Amendment removes all doubt by making it a statutory requirement. I beg to move.
LORD STRATHCLYDE: It was during the debate on Second Reading that I expressed an interest in this new Commission, and then my noble friend was good enough to say that if I cared to raise the matter at a later stage he would try to explain it further. I want to express my most sincere thanks to my noble friend for the explanation he has given, so fully and so clearly. I thank him most sincerely for it. He has relieved any doubt that I had in my mind and I am grateful to him.
LORD POLWARTH: I beg to move Amendment No. 93.
Amendment moved—
Page 52, line 5, leave out ("them") and insert ("the Commission").—(Lord Polwarth.)
Clause 97, as amended, agreed to.
Schedule 8 agreed to.
Clauses 98 to 101 agreed to.
Clause 102 [Reports to Commission by Controller of Audit]:
LORD POLWARTH LORD POLWARTH moved Amendment No. 94:
Page 54, line 33, at end insert—
(" (2) Without prejudice to subsection (1) above, the Controller of Audit may make a report to the Commission on any matters arising out of or in connection with the accounts of a local authority in order that those matters

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may be considered by the local authority concerned or brought to the attention of the public, and shall send a copy of any report so made to any local authority which is named in that report.")
The noble Lord said: As I explained earlier, the Controller of Audit will make reports to the Commission on various matters and formal reports will only be made on issues of importance which cannot be disposed of easily by consultation with the officials of the local authority concerned. There will be two kinds of report—general reports and special reports. We envisage that special reports will be like those which are at present called interim reports of an auditor, which will draw attention as quickly as possible to cases where, in the opinion of the Controller of Audit, any item of account is contrary to the law or there have been other irregularities of the kind with which we are all familiar and which are dealt with by interim reports at present.
On the other hand, general reports will be made on the completed audits of the year and will draw attention to a wider field—to matters, for instance, of financial administration or accounting practice, which might be helpful, on which comment by the Commission would be useful to the local authorities or in the interests of the ratepayer. We are advised that the wording of Clause 102(1) may not be sufficiently specific to cover the making of such general reports, and we see this as an important feature of the new system. The object of the additional subsection which this Amendment proposes is to make this clear beyond doubt. I beg to move.
Clause 102, as amended, agreed to.
Clause 103 [Action by Commission on reports by Controller of Audit]:
9.35 p.m.
LORD POLWARTH LORD POLWARTH moved Amendment No. 95:
Page 56, line 5, leave out from beginning to ("the") in line 10 and insert—
(" (3) Subject to subsection (4) below, if after consideration of the matters referred to in subsection (2) above the Commission find that any item of expenditure is contrary to law, or that there has been a failure to bring into account any sum which ought to have been brought into account, or that any loss or deficiency has been incurred or caused as mentioned in section 102(2)(a) of this Act, or that a local
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authority have not taken steps to remedy such a matter as is referred to in section 102(2)(b) of this Act, the Commission shall send the special report together with their findings to the Secretary of State and may recommend him to make an order—

(a) requiring any person whom they find responsible for incurring or authorising that expenditure, or for that failure, or for that loss or deficiency, as the case may be, to pay to the local authority concerned an amount not exceeding the amount of the said expenditure, or of the said sum, or of the said loss or deficiency; or, as the case may be,

(b) directing the authority to make such rectification of their accounts as appears to the Commission to be necessary.

The noble Lord said: The Committee will be relieved to hear that I intend to speak not only to this Amendment but to Nos. 96, 97, 98, 99, 100, 101 and 198. I thought that would be welcome news. I am afraid that this again is a matter that requires a little explanation. As I said earlier, one of the intentions in setting up this Commission for local authority accounts is to reduce the involvement of the Secretary of State in audit matters which could well be misunderstood as a form of control by central over local government, so we propose the main responsibility for considering audit reports shall devolve on the Commission who will make recommendations to the Secretary of State. These Amendments are designed to make more clear the procedure of allocating responsibility where it is intended that it should belong. In general, the Commission shall consider and recommend, and the Secretary of State shall decide in the light of their recommendations, and of any representations made to him by persons who may be affected.
The main change affected by this group of Amendments—and I apologise for the fact that we have had to make these changes—is the transfer to the present Clause 103 of a good deal of what is now in Clause 104, so we have one clause dealing with the Commission, and one dealing with the Secretary of State. Under these provisions the Secretary of State holds hearings at which persons concerned can express their views, make objections or require a case to be stated to the Court of Session on any point of law. It is not intended that the Secretary of State should then have to go over the ground again, but it could be implied that that was so from the first part of Clause 104. The Amendment would

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make it clear that it is for the Commission, when they inquire into special reports, to reach conclusions on relevant matters and facts of law which the Secretary of State will not then re-open. They will recommend to him how his powers should be used. I do not think I need worry your Lordships by going into all the Amendments in detail, unless any of your Lordships would like to raise any point. I can assure the House that all the Amendments hang together in clarifying where the different responsibilities should lie.
LORD HUGHES: I notice in the Amendment now moved that there is reference to 102(2)(a) and (2)(b). I presume that this is automatically changed because there has been a new 102(2) put in and it has now become a reference to 102(3)(a). Is this the sort of thing which is done automatically without any necessity?
LORD POLWARTH: I am most grateful to the noble Lord for drawing my attention to this. I understand the machinery will look after it.
Clause 103, as amended, agreed to.
Clause 104 [Action by Secretary of State on recommendation by Commission under s. 103(3)]:
LORD POLWARTH: I beg to move Amendment No. 96.
Amendment moved—
Page 57, line 1, leave out from beginning to ("acted") in line 32 and insert—
(" (1) Where recommendations are made to the Secretary of State under section 103(3) of this Act the Secretary of State may make an order giving effect to any recommendation, with or without modifications, or may decline to make such an order.
(2) The Secretary of State shall not make an order under subsection (1) above requiring a person to pay an amount to a local authority if the Secretary of State is satisfied that that person ").—(Lord Polwarth.)
LORD POLWARTH: I beg to move Amendment No. 97.
Amendment moved—
Page 57, line 40, leave out ("paragraph (a) of ").—(Lord Polwarth.)
LORD POLWARTH: I beg to move Amendment No. 98.
Amendment moved—
Page 58, leave out lines 2 to 5 and insert ("subsection (1) above requiring a person to pay an amount to a local authority, forthwith cause a copy of that order to be sent—
(a) to that person;").—(Lord Polwarth.)
LORD POLWARTH: I beg to move Amendment No. 99.
Amendment moved—
Page 58, line 9, leave out (" paragraph (a) of ").—(Lord Polwarth.)
LORD POLWARTH: I beg to move Amendment No. 100.
Amendment moved—
Page 58, line 20, leave out ("under paragraph (b of ") and insert ("in an order under").—(Lord Polwarth.)
Clause 104, as amended, agreed to.
Clause 105 [Regulations as to accounts]:
LORD POLWARTH: I beg to move Amendment No. 101.
Amendment moved—
Page 59, line 2, leave out ("or of any direction given to them").—(Lord Polwarth.)
Clause 105, as amended, agreed to.
Clauses 106 and 107 agreed to.
Clause 108 [Determination and levy of regional, district and general rates]:
9.39 p.m.
LORD HUGHES LORD HUGHES moved Amendment No. 101A:
Page 60, line 31, after second ("year") insert ("not added to reserve funds").
The noble Lord said: This again is on the subject of reserve funds. When we were talking on my previous Amendments, which were also on the subject of the reserve funds, the noble Lord, Lord Drumalbyn, referred to the removal of the disability in adding to the funds. At present, this is limited to 21p in any one year. My difficulty in reading Clause 108 was that it did not seem to make provision for putting money to reserve. Page 60, line 25 reads:
"It shall be the duty of every local authority to determine such regional, general or

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district rate, as the case may be, as will provide sufficient moneys to meet such part of the total estimated expenses to be incurred by the authority during the financial year in respect of which the rate is to be levied (after taking account of any balance or estimated balance at the end of the financial year immediately preceding that year) …"
That is the point at which I am proposing to add the words "not added to reserve funds".
The subsection continues:
"as falls to be met out of moneys raised by rates, together with such additional amount as is, in the opinion of the authority, required—

(a) to cover expenses previously incurred,

(b) to meet contingencies,

(c) to meet any expenses which may fall to be met before the moneys to be received in respect of the regional, general or district rate, as the case may be, for the financial year next following the first-mentioned year will become available."

On the face of it, there does not seem to be any authority to put money to reserve, and yet obviously if the Government have removed the limit of 2½p—the amount that could be placed to reserve in a particular year—it is intended that it should be possible to put money to reserve.
LORD DRUMALBYN: May I interrupt the noble Lord? The noble Lord is speaking to both Amendments Nos. 101A and 101B, is he?
LORD HUGHES: Yes, that is so. Neither will be necessary if I can be assured under what Part of the Bill the authority have power to put money to reserve. What raised my doubts was the first part that I sought to amend, which said:
"… after taking account of any balance or estimated balance …".
I know it has been the case with quite a number of authorities that if they have finished the year with a surplus that surplus was automatically placed into the reserve fund, subject, of course, to the present limitation of 2½p. If they wanted to put less than that of course they could do so, but they had to carry forward into the next year any surplus beyond 2½p, although it is not likely that many authorities nowadays have a surplus of more than 2½p at the end of the year.
The usual provision was that money went to reserve, and if they wanted to use any part of the reserve to diminish the rate for the following year, then when
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the treasurer was making his estimates or the finance chairman was making his statement to the authority in due course he intimated how much money he was prepared to take out of the reserve fund. The clause as it stands would seem to prevent the local authority from putting any balance at the end of the year straight to reserve. They have to take it automatically into the accounts for the following year. If there is elsewhere adequate provision enabling the local authority to put such sums, without limit, to reserve my point is made. I want to safeguard the right of the local authority to create reserve funds. Perhaps the noble Lord can let me know where that is provided for. I beg to move.
LORD DRUMALBYN: So far as I can understand what the noble Lord has been saying, he really has two objects in mind. As he says, he wants to safeguard the putting of funds into a reserve fund. If this is what he is seeking to do then I can tell him that no amendment of Clause 108(2) is necessary for this purpose, because local authorities are authorised by Sections 8 to 10 of the Local Government (Development and Finance) (Scotland) Act 1964 to establish and contribute to reserve funds, and Clause 107, replacing Section 211 of the Local Government Act 1947, provides for general sanction for expenses on functions under public general Acts to be met from rates.
If I may say so, I think one point where the noble Lord may perhaps not quite have appreciated the situation is that this clause is dealing with the duty of local authorities. While they have power to make contributions to a reserve fund, it would be strange to give them a duty to contribute to a reserve fund. The second point is that the noble Lord intends that the local authorities should not be inhibited from amassing revenue reserve funds out of revenue surpluses at the end of the year as a form of rate equalisation account.
I am not absolutely certain I was right in what I told him before about the use of reserve funds, or as to the transfer to revenue account from the reserve fund. The general concept is that the rating should be sufficient to meet the expenses, taking one year with another, and I think that is made pretty clear in this particular clause. If this is what the noble Lord is wanting, I am bound to

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say to him that Clause 108(2) is in terms very similar to those of Section 212(1) of the 1947 Act, which it replaces, particularly as regards the treatment of any balance on revenue account from the preceding year. The underlying intention of both provisions is that local authorities should as far as possible balance their accounts year by year and should not accrue either surpluses or deficits. The Government attach importance to the principle that the total rate demand for each year should be neither more nor less than is needed to meet the year's outgoings. I hope this makes the position clear, that there is power to contribute to a reserve fund, but it is not the intention that the reserve fund should as a principle be built up from revenue for use towards things that would normally be met from revenue.
LORD HUGHES: I am grateful to the noble Lord for that explanation. I would say right away that I had not in fact appreciated that the second Amendment was placing a duty on the local authority to put money into reserve funds. I did not notice the words right at the beginning of subsection (2). Of course, it would be quite wrong to put an obligation on them to provide a reserve. So I will not in fact move Amendment No. 101B.
I am still not quite certain how the reserve funds are ever going to be increased if the local authority are not allowed to put a surplus to reserve at the end of a year. If the intention is, as the Minister has stated, that the local authority would normally rate for the expenditure which they intend or expect to incur, and that they should not be budgetting either for surplus or deficit, I do not see where a contribution to reserve is going to come from other than the balance that might accrue at the end of a year, unless the Government are acceptting that the local authority, in stating what they are raising money for in the ensuing year can say " and we propose to put x pounds into reserve ", and will rate for that. That would be in direct conflict with the requirement that they should be rating only for the amount necessary to balance their accounts. It is this business of saying that a surplus must automatically be carried forward to the next year which I think hits at the accumulation of reserve funds. I may be getting a bit dim as the time goes on, but
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I still have not understood that the Minister has given me assurance on that point.
LORD DRUMALBYN: The power to contribute to reserve funds remains. The way in which it is envisaged that these reserve funds should be used is, for example, to make provision for renewals, to make provision for anticipated acquisitions and that sort of thing.
LORD HUGHES: I have no doubts about the way the reserve fund can be used; what I am asking is how they are created.
LORD DRUMALBYN: Yes, I understand that. The contributions to capital reserve funds are normally budgeted for and are a proper charge on the year's rates. Up until now there has been this limitation of 2½p. The fact that the limitation is removed does not mean that the contribution is removed. They can make the contribution, and it will be a contribution on the year's rates. What we are not intending should happen is that the funds should be amassed from rates as a rate equalisation fund. They are to be used for capital expenditure, and because they will be capital expenditure, as we saw before when dealing with a previous Amendment, they will be subject to the control of the Secretary of State in so far as they represent the creation of new resources. That is why I am saying here that the kind of use to which they will be put is renewals, or anticipated acquisitions. This is the kind of use that they can be put to.
LORD HUGHES: I see now, and this makes me most unhappy. I am quite certain that the local authorities do not appreciate what is happening here. This is the abolition of reserve funds as local authorities have known them up to the present, and they are only going to be allowed to have a new type of reserve fund usable for capital purposes. In that sense the definition of capital expenses earlier makes sense. It did not make sense at the time when we were discussing it, and nothing was said that made sense of it, because it was not stated that the type of reserve fund was being changed. A principal use that local authorities have made of the reserve fund was as a rates equalisation fund. Has there been consultation with the local authority associations? Do they know that it is part of

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this Bill that they are not to be allowed to have rate equalisation reserves? If so, I am surprised that they have accepted this, because the type of use I have indicated has always been regarded as one of the best things that a prudent treasurer or finance convenor would wish to do. It is most undesirable that there should be needless fluctuations in rate amounts.
The City of Edinburgh is a capital example of this. Because of the reserves they had accumulated through what some people would call "prudent financing" and other people "meanness", they were able to avoid rate increases over many years, because every year they dipped into the reserve fund, until the day came when Mr. Imrie had to tell them that they had reached the bottom of the barrel and that the rates should go up in Edinburgh just as they did elsewhere. Unkind political people said that what had happened was that the Tories made certain that the reserve funds were used up before there was a Labour majority in the Edinburgh Town Council. However, I am not going to enter into that aspect of it. It is important that local authorities should know that a fundamental change is taking place in the reserve funds. I propose to withdraw this Amendment, but I will make certain that the chamberlains in Scotland, and the other finance officers, know what this is about. If they and the treasurers and finance conveners are happy about it, then I will let the matter rest there; but I shall be very surprised if they are. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 108 agreed to.
Clauses 109 to 113 agreed to.
Clause 114 [Variation of standard scheme by rating authority]:
9.55 p.m.
On Question, Whether Clause 114 shall stand part of the Bill?
THE EARL OF BALFOUR: I should like to take this opportunity of asking a question about subsection (7). There appear to be slight differences in the way in which the rent and rates rebate
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might be calculated, and I feel that it would be a pity if two different calculations had to be fed into the same computer in a local authority. If they were on practically the same lines the same computer could be used, but there appear to be slight differences.
LORD DRUMALBYN: I am not clear what differences the noble Lord is referring to. If he has something in mind which is fairly detailed it might be better if we discussed it together off the Floor of the House, in order to see where the differences lie.
THE: EARL OF BALFOUR: I thank my noble friend and I shall be happy to do that.
Clause 114 agreed to.
Clause 115 agreed to.
Clause 116 [Valuation areas and authorities and appointment of assessors, etc.];
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 102:
Page 68, line 21, at end insert—
(" (5A) The assessor of a region in making up the valuation roll of the region shall distinguish in the roll lands and heritages situated within the boundaries of each district of that region.")
The noble Earl said: With this Amendment, I should like to speak to Amendments Nos. 105, 182A and 202A. The purpose of this Amendment is to replace paragraph 1 of Schedule 9 on page 167, which is itself an Amendment to Section 49(3) of the Local Government (Scotland) Act 1929, which could then be repealed. I believe that my Amendment would simplify matters. I beg to move.
LORD DRUMALBYN: I am bound to say that the Amendments do not make any substantive change to the proposals already in the Bill, but it may be more convenient to have the noble Earl's drafting as it is more direct than what is already there. So the Government have no objection to this Amendment and I shall be happy to accept it.
Clause 116, as amended, agreed to.
Clause 117 agreed to.
Clause 118 [Local financial returns]:
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 103:
Page 69, line 35, at end insert ("or any river purification board within the meaning of section 134 of this Act")
The noble Lord said: This Amendment is consequential on the Commons' decision to retain river purification boards. I beg to move.
Clause 118, as amended, agreed to.
Clauses 119 and 120 agreed to.
Clause 121 [Rates of interest in relation to certain sums due to local authorities]:
10.0 p.m.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 104:
Page 71, line 31, at end insert ("section 56(3) of the Water (Scotland) Act 1946;")
The noble Lord said: This Amendment rectifies an omission by adding Section 56(3) of the Water (Scotland) Act 1946 to the list of enactments in subsection (1). I beg to move.
On Question, Whether Clause 121, as amended, shall stand part of the Bill?
LORD HUGHES: The purpose of this clause is to substitute the rate of interest in subsection (2) for the rate of interest which is payable under these various provisions, to which the noble Lord has just added another one. Subsection (2) says:
"The said rate shall be one-quarter per cent. above the relevant rate determined by the Treasury in relation to loans ",
et cetera. What I want to know is whether this means that they are going to be charged more money or less money? What are they being charged under the provisions which are being done away with?
LORD DRUMALBYN: I am not sure. The point is that it standardises the amount. It simplifies the administrative procedures by providing that the relevant rates of interest or maximum rates of interest are in effect determined by the Treasury Loan Commissioners when from time to time they fix the interest rates chargeable by the Public Works Loans
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Board instead of having them determined as and when the borrowing is done.
LORD HUGHES: I think the noble Lord is trying to wear me down by answering questions I do not ask. What I want to know is: are they paying more money? I would not be happy about having a thing standardised if at the end I was paying out more money. Let me put it another way. Under Section 10(2) of the Coast Protection Act 1949, are the authorities paying more or less than a quarter per cent. above the relevant rate determined by the Treasury for 15-year loans?
LORD DRUMALBYN: I am sorry that I did not answer the question, but I did not have the answer then. The answer is that this is a question of up-dating, because the borrowing rate has not been shifted. The regulations date from 1949 and specify the rate of interest as 5½ or 5¾ per cent., depending on whether the instalments chargeable are payable over a period of more or less than five years. These regulations have not been up-dated because no coast protection work, in the first case, has been set for several years. In each case there are different rates which have been fixed at different times. But the answer is that of course current rates of borrowing would be higher than the rates which were fixed some time ago, but presumably the current rates will not remain for ever, and this introduces the desirable flexibility and keeps things in relation to the current borrowing rate.
LORD HUGHES: Does this mean that authorities which are at present paying a rate of interest less than the current rate will, as from the passing of this Bill, find that they are paying money at the higher rates of interest or at the lower rates of interest, as the case may be, although I think the second one is very doubtful? Is that the position?
LORD DRUMALBYN: Yes. At the present time they will be paying at a higher rate because the rates have never been up-dated.
LORD HUGHES: They are paying a lower rate at the present time?
LORD DRUMALBYN: They are paying a lower rate than they will be paying. They will be paying a higher rate because the

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present rate has not been up-dated. However, the future rate will not remain fixed as the present rate has done. We hope that in due course, as these things go, the rate will come down, and in future it will be related to the borrowing rates prevalent at the time.
LORD HUGHES: It will certainly be a long time before it comes down to the rate chargeable under the Coast Protection Act 1949, which is 5½ to 5¾ per cent. Even the most optimistic occupant of the Government Front Bench cannot expect that to be happening either tomorrow or the day after. This seems to me to be a rather cunning device to get more money out of local authorities and into the Treasury. I think I will have a look at this before the next stage.
LORD DRUMALBYN: The noble Lord may have a look at it; but when
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we are talking about paying, it is the local authority that are being paid. It may interest him.
LORD HUGHES: That is even worse. They are taking it out of the ratepayers from whom they are getting enough already.
Clause 121 agreed to.
Clause 122 agreed to.
Schedule 9 [Amendments with respect to finance]:
THE EARL OF BALFOUR: I beg to move Amendment No. 105.
Amendment moved—
Page 167, line 37, leave out paragraph 1.—(The Earl of Balfour.)
10.7 p.m.
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 106A:
Page 168, line 33, leave out sub-paragraphs (a) and (b) and insert—

("(a) subsection (2)(f) shall cease to have effect;

(b) for subsection (3) there shall be substituted the following subsection:—

"(3) A demand note shall be in such form, and shall contain such information in addition to the information required by subsection (2) above, as may be prescribed by regulations made by the Secretary of State under section III of the Local Government (Scotland) Act 1973".")

The noble Earl said: This Amendment is to provide that the demand notes for rates in Section 237 of the Local Government (Scotland) Act 1947 are preserved and that the only part deleted is subsection (2)(f) and not the whole subsection I am grateful to my noble friend for assistance in re-drafting the second part, paragraph (3), of this Amendment. It does not change the sense of the Bill, but it makes it easier for somebody who has more than one piece of property. I beg to move.
LORD DRUMALBYN: My noble friend's Amendment leaves most of the requirements as to the content embodied in the Act. All that will be left out will he the outdated requirement of subsection (2)(f) regarding the itemisation of expenditure met from rates and grants. For that reason I am happy to accept this Amendment.
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 109:
Page 174, line 23, after ("region") insert ("and the districts within that region".)
The noble Earl said: On page 174, I ask that 35 copies of the estimate be sent not only to the rating authority for that region but also to any district within that region. Hence the reason for my Amendment. I beg to move.
LORD DRUMALBYN: I am prepared to accept this proposal in principle, but I do not think my noble friend's Amendment quite achieves what he wants. If he will withdraw the Amendment I am prepared to put an Amendment down, if that is what the Committee wishes.
THE EARL OF BALFOUR: I am happy to withdraw the Amendment and I am grateful for my noble friend's undertaking to look at this matter, for I think it is important.
Amendment, by leave, withdrawn.
THE EARL OF BALFOUR: This is a purely drafting Amendment to cover the definition in Clause 26 of the Local Government (Financial Provisions) Act 1963. I beg to move.
Amendment moved—
Page 175, line 27, at end insert—
("In section 26(2) for Local Authority there shall be substituted "means a region or island council".")—(The Earl of Balfour.)
LORD DRUMALBYN: I do not think this Amendment is necessary, but I am prepared to look at it before the next stage.
THE EARL OF BALFOUR: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Schedule 9, as amended, agreed to.
Clause 123 [Education authorities]:
LORD POLWARTH: This is one of a previous group of Amendments to which I spoke. I beg to move Amendment 111.
Amendment moved—
Page 72, line 16, leave out ("1971") and insert (" 1973 ").—(Lord Polwarth.)
Clause 123, as amended, agreed to.
Clause 124 [Education committees]:
LORD STRATHEDEN AND CAMPBELL LORD STRATHEDEN AND CAMPBELL moved Amendment No. 112:
Page 72, line 27, at end insert ("other than any function which the authority may delegate to the Committee.")
The noble Lord said: I mentioned this Amendment on Second Reading. My trouble over Clause 124 is that it makes it quite impossible for the regional council, which is the local authority, to delegate anything to the education committee. I say that because, to quote part of the clause:
"Every education authority shall appoint a committee, which shall be known as the

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education committee to which … all their functions as such authority shall stand referred. In this subsection, 'referred' means remitted to the committee for consideration and report to the authority but without power to the committee to discharge any function on behalf of the authority."
Nothing can possibly be clearer than that; you cannot delegate. Clause 65 starts by being subject to any other part of this Bill, including Clause 124. Schedule 10 is quite clear. It is subject to the provisions of Clause 124 before it is possible to delegate. This is not entirely my own idea. I got in touch with the Association of Directors of Education in Scotland, and in their submissions when the Bill was being drafted they stressed the importance of delegation. The director of education with whom I discussed this matter said that they had brought the matter up again with the Government but had obtained no satisfaction; and they were extremely worried about the fact that any delegation seemed to be made quite impossible. I hope that my noble friend Lord Polwarth will either accept my Amendment or, at least, have a careful look at this matter to make sure that it is possible to delegate to the education committee.
BARONESS ELLIOT OF HARWOOD: I wish to support this Amendment. The noble Lord, Lord Stratheden and Campbell, and I have both been chairmen of education committees in the past, and I know that it is vital that education committees should have the authority to take executive action in the way delegated to them by the county council. If they cannot do this, everything is held up and has to go back, in this case to the regional council and in other cases to the county council. It would be a great mistake if the powers under the new legislation did not include delegation as part of the authority's executive power.
LORD POLWARTH: I will endeavour to reassure the noble Lord and the noble Baroness that their understanding is not correct. I have some sympathy with them because, thanks to the mysteries of draftsmanship, a certain amount of pursuit from one section to another is involved in ascertaining the correct position. I will try to explain it and make it as clear as I can. Clause 24(1) obliges the educa-
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tion authority to appoint an education committee and to refer all educational matters to it. That means that the authority is not entitled to take a decision on any educational matter without having obtained the advice of the education committee. That is the first point.
Now we come to the word "referred" in lines 24 to 27. The use of the definition "referred" is merely to make clear what the education authority must do as a minimum by way of obtaining advice from the education committee. It does not by any means limit the role of the education committee to the minimum. When it says:
"… without power to the committee to discharge any function on behalf of the authority",
that means in relation to this general reference to all matters for consideration.
Now, if your Lordships will look at lines 20 and 22 on that page, in subsection (1) we come to the key words which mention the possibility of an arrangement under Clause 127. That clause, in turn, refers to Schedule 10, which opens with the words:
"Subject to the provisions of Clause 124 … an education authority may arrange for the discharge of any of their functions by their education committee …"
And "discharge of functions" includes delegation. So what Clause 124 is securing is, first of all, that all educational functions are referred to the education committee for its advice; and secondly, that the general power of the authority to delegate functions to committees applies equally to education committees. Therefore I submit that there is no cause for anxiety that the powers of delegation do not exist, though I admit it requires a rather detailed perusal of the provisions to arrive at the conclusion that they do exist.
LORD HUGHES: I had a letter from the noble Lord, Lord Polwarth, which pleased me because all this was put down in writing for me, and after reading the letter through two or three times, and going backwards and forwards from Clause 56 to Clause 124, Clause 127 and Schedule 10, I eventually came to the conclusion that the noble Lord was not misleading me and that the power to delegate to an education committee did exist. But

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I must say that if any poor soul outside this House who is not a lawyer wants to try to find out what is to happen, he will have a devil of a job. I cannot understand why draftsmen have such complicated ways of doing things. To have to go into three clauses and a Schedule to find out so simple a thing as giving delegation of power seems to me to be the height of absurdity.
LORD STRATHEDEN AND CAMPBELL: Before withdrawing the Amendment, I would ask my noble friend to have another look to see whether it is not possible to make this a little clearer. Having said that, I beg leave to withdraw the Amendment.
LORD HUGHES: Before the Amendment is withdrawn, could I suggest that if the noble Lord would regard this as being the equivalent of a financial matter, and do the quick, good job that he did on Clause 103 and 104 to get the matter sorted out, he would be rendering a service to humanity.
LORD POLWARTH: Before the noble Lord withdraws the Amendment, I can give the assurance that I will certainly bring this matter to the attention of those concerned with such mysteries.
Amendment, by leave, withdrawn.
10.19 p.m.
THE EARL OF CROMARTIE THE EARL OF CROMARTIE moved Amendment No. 113:
Page 73, line 5, after ("area") insert ("or the Highland Region").
The noble Earl said: Most of the subjects prior to the last Amendment have been financial in nature. I am now turning to something rather more holy on which I have had representations from the areas concerned; namely, that the Highland region should follow the same procedure as the Islands Authority. I have had no views to the contrary, and I should be grateful if my noble friend the Minister could consider this matter. I beg to move.
LORD BALERNO: I think that probably no clause in this Bill has created greater discussion in Scotland than this one, which relates to the representation of the Churches on the education committee. It has been debated in practi-
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cally all the presbyteries of the Church of Scotland, and a note has been taken of it by the Roman Catholic hierarchy and the Episcopal Church. The change that was made in the Bill in sub-paragraph (iii) as it was originally drafted was to give three Churches representation on the education committee: one for the Church of Rome, one for the Church of Scotland and one (not necessarily another Church) nominated as representing the Churches. A special exception was made in the case of the Highlands area because they have a number of minor Presbyterian denominations. The most notable of them are the Free Church and the Presbyterian Church, and there is a very strong pocket of the Roman Catholic Church. Therefore it was felt to be only right that in the Highland area there should be four representatives from the Churches on the education committee and the minor Presbyterian Churches would also have an opportunity of being represented.
Along the West Coast of the Highlands there are several congregations of both the Free Church and the Presbyterian Church as well as the Roman Catholics, the Episcopalians and the Church of Scotland. I think that if justice is to be done to these Churches it would be most appropriate to apply to the Highland area the right to have four representatives of the Churches on their education committee. To my mind, that is just common justice, and I should think it would be very prudent on the part of the Government to do this. In view of what has been said about declaring an interest, I have one to declare. I hope I shall not be condemned for not having declared an interest at the beginning and therefore perhaps having to leave the Chamber. My interest is this. Though I am now an Elder of the Church of Scotland, I was born in a Free Church manse.
LORD HUGHES: I should like to support the noble Lord. A number of years ago I spent a holiday in Wester Ross, in Gairloch; and one Sunday when I went to look for the Church of Scotland I missed it. Then I saw an enormous building which I assumed to be the Church of Scotland—but I very speedily learned that this "Cathedral" was in fact the Free Kirk—we call them the "Wee Frees". The Church of Scotland, when I found it, was a very modest

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little building. It was quite obvious which was the predominant religious denomination in that part of the region. I think that at least in part of the Highlands exactly the same case can be made as can be made in the Islands area.
I am not certain, if we put this into the Bill, that it will be well received in another place, because there is a strong body of opinion there (and it is not totally unrepresented in your Lordships' House) that in fact there should be no representation at all from the Churches. The point of view has been expressed that if Ministers want to get on to local authorities they should get themselves elected as councillors. However, I do not think that is the general view, and I believe that the noble Lord is on to a good point here. Like the noble Lord, I must declare a half interest—it is not direct or indirect or pecuniary, any more than his was: I am an Elder of the Church of Scotland; I cannot claim to have been born in a Free Church manse.
LORD BALERNO: Before the noble Lords sits down, he mentioned the case of Gairloch—that is a particularly interesting one. There is a large Free Church congregation and the Cathedral which he mentioned was built from the proceeds of a bazaar in Dundee.
LORD HUGHES: Does that mean I have to declare an indirect pecuniary interest then?
10.25 p.m.
LORD POLWARTH: We are now venturning on to very delicate ground. These matters of religious representation are food and drink to us in Scotland. We must be very careful in our handling of these affairs. May I point out that the provision about Church representation on education committees in this Bill has been arrived at after very lengthy discussion in another place and after the consideration of a great volume of representations from many different branches of the Christian Church. I know how hard my right honourable friends in another place have endeavoured to meet the widest demands in this matter, and it has not been easy. As the clause now stands, it represents a balance which we believe has widespread support. It has been very difficult to reach a position of such balance. We would be somewhat chary of
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disturbing that at this stage. We might very well find the last stage worse than the first. I appreciate that in the Highland region there is more than one importan minority Church—if that is the phrase I should use. But this is not true only of the Highlands. I would not like to say that there is any area in Scotland where more than one minority Church might not feel entitled to put forward a special claim for consideration. One thinks certainly of the Episcopal Church in the North-East of Scotland where it is traditionally extremely strong.
I think we ought to ask ourselves carefully what we are trying to do in this provision. It is certainly not, and it could not be, our intention to try to ensure that there is present on the education committee a representative of every branch of the Church. That would be impossible. The main object of the provision is twofold: first, to ensure some place for the voice of the Church, and because we are dealing with Scotland that has to mean a place for the Church of Scotland; and secondly, to honour the long-standing agreement that Churches who had handed over denominational schools to the State would be given a say in their administration; and that means a place for the Roman Catholic Church. The decision to add a third place was taken in the face of a strong feeling in and out of Parliament that minorities should be given the opportunity of a statutory place as well. But I seriously suggest to your Lordships that, with the addition of that third obligatory place, the provision now goes far enough.
Let me emphasise that there is nothing in the Bill to prevent education authorities from appointing further Church representatives if they so desire. Most education authorities do so now of their own discretion and there is no reason to suppose that this will be different in the future. What we are discussing is the statutory duty to appoint Church representatives—the minimum number to be appointed. Furthermore, I should emphasise that if the Amendment were made and the Highland region were placed under this special obligation, it would not necessarily lead to the appointment of a representative of any particular Church. The choice of a representative would remain at the discretion of the education

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authority lust as much as if the Amendment had not been made.
I can assure your Lordships that nothing that I have said will be construed as suggesting that I or my colleagues in the Government have any desire to restrict the appointment of Church representatives to education committees. The education authorities will be free to do as they think proper, and that we think it right that they should be so free. Our view is, however, that we should not impose unnecessary obligations, and that the Bill goes far enough at it now stands. I should be loth to see this hard-won balance of opinion reached in another place disturbed at this stage. I would respectfully ask your Lordships not to accept the Amendment.
LORD HUGHES: There is one point. On re-reading this Amendment I would ask whether the noble Lord, Lord Balerno, is right in talking about an increase to four representatives? Is it not three throughout?—because the provision is that in the islands there is no specific need to appoint a representative of the Roman Catholic Church; they have to take their chance among the two unspecified ones. So it is a requirement to have three in every case.
LORD POLWARTH: Yes; the noble Lord is correct.
LORD HUGHES: So the effect of the Amendment of the noble Earl, Lord Cromartie, would in fact be to put the Highlands in the position of having four representatives instead of three, whereas everywhere else it would be three. I think that on that basis I am going to withdraw my support.
THE EARL OF CROMARTIE: In view of the very specific reply that has been given by my noble friend the Minister, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 124 agreed to.
10.31 p.m.
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 114:
After Clause 124, insert the following new clause—
Education: Chairman of Education Authority
—(1) The education committee established under section 124 of this Act shall appoint from the elected members of the local authority a chairman under the same conditions as are described in Section 3 of this Act with the exception that subsection (6) of section 3 shall not apply to the chairman of the education committee.
(2) The Chairman appointed under subsection (1) of this section shall be an ex-officio member of the school and college councils established under section 125 of this Act."
The noble Earl said: Very briefly, I should like to point out to your Lordships that the chairman of the education committee has far more work to do than any other local authority official. As chairman of the regional education committee, or even island committee, he is going to be far harder worked than the convener or anybody else. That is why I ask that he also should have an expense allowance, or the local authority should be in a position to give him one. He needs to be treated as rather a special case. He is asked to contribute towards a lot of school prizes, and let us not forget that he will be responsible for the spending of somewhere between 65 per cent. and 70 per cent. of the rates. So I feel he needs to be treated rather as a special case. I beg to move.
LORD POLWARTH: I am bound to say that when I saw the noble Earl's Amendment on the Paper I failed to spot what now appears to me to be the principal object of the Amendment. I was going to query the need for a special authority for the education committee to appoint a chairman; the right to appoint a chairman is I think inherent in any committee or body and it is not specifically written into the Bill with regard to committees of local authorities. But the noble Earl has brought up this particular point, and the object was to refer to the conditions mentioned in Clause 3 of the Bill. The provision he has referred to is that the council may pay the chairman, enabling him to meet the expenses of his office, such allowance as the council thinks reasonable. In Clause 3, to which he has referred, the reference is to the chairman of a council and not of a committee of the council. To single out the chairman of the education committee, important though that committee is, to give him an allowance, is going against the principles which we discussed earlier with

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regard to allowances. I do not think we can entertain this new condition. The committee will have power to appoint a chairman; it has it automatically and it does not need to be written into the Bill.
I find it difficult to comprehend the second part of the noble Earl's Amendment. He is saying that the chairman so appointed
"shall be an ex-officio member of the school and college councils established under section 125 of this Act."
There are two main objections to this. One is that the school and college councils are intended to be independent bodies and should not be attached too closely to the area education authorities, and this Amendment would, I think, militate against this. The second point is that we have already been told by the noble Earl that the chairman of the education committee is one of the busiest people in the authority. If in addition to that he is to be expected to attend meetings of every school or college council in his area, I do not think he would ever have time to sit down. So, with great respect, I must ask your Lordships to reject the Amendment.
THE EARL OF BALFOUR: I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 125 [School and college councils]:
10.35 p.m.
LORD POLWARTH: This Amendment and the following one, No. 116, are purely drafting. They move the provision giving a status to school and college councils from their present position in Clause 127 to form part of Clause 125, which seems to us to be the appropriate clause because it deals with school and college councils. There is no change in the effect. I beg to move Amendment No. 115. Amendment moved—
Page 74, line 35, at end insert (", and, except where the context otherwise requires, references in sections 59 and 60 of this Act to a sub-committee shall include references to a school or college council.")—(Lord Polwarth.)
LORD HUGHES: I wonder whether I might ask a question which has absolutely nothing to do with the Amendment we are now discussing. It was only when we
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were discussing Amendment No. 114 that the opportunity arose and I was all set to raise it on the Question, Whether the clause should stand part of the Bill; but as the suggested new clause did not go in the opportunity did not arise. It arose from a remark made by the noble Lord, Lord Polwarth, that of course the education committee has power to elect the chairman. I thought the chairman of the education committee would be appointed by the education authority. If in fact it is being done by the committee this is a new departure. At the present time the chairman of the education committee, like the chairman of any other committee, is appointed by the town or county council concerned. They do not leave it to the education committee to decide who the chairman will be, and one of the points in Amendment No. 114 was to prevent the chairman of the education committee being one of the co-opted members; he would have to be an elected member. If that Amendment did not go in there would be nothing to stop the education committee appointing a co-opted member as the chairman. That is undoubtedly a change from the present set-up. Is that the intention?
LORD POLWARTH: The information given to me is that all committees appoint their own chairman. If the noble Lord thinks that is incorrect I will certainly look into it.
LORD HUGHES: I know that the advice given to the Minister is incorrect because certainly in the town councils the chairman of the education committee is appointed by the town council and not by the education committee.
THE EARL OF BALFOUR: That is certainly the case in the county of East Lothian as well. The chairman of a committee is appointed by the full council and not by the sub-committees, and I do not think this task should be undertaken by the sub-committees. I am very glad that the noble Lord, Lord Hughes, has taken up this point and I must ask my noble friend to investigate it.
LORD POLWARTH: I think I can only undertake to do so.
LORD HUGHES: What is quite certain is that if this is being done it is a change, and it is one that will be resisted.
Clause 125, as amended, agreed to.
Clause 126 agreed to.
Clause 127 [Discharge of education authority functions]:
10.40 p.m.
LORD POLWARTH LORD POLWARTH I beg to move Amendment No. 116.
Amendment moved—
Page 75 line 22, leave out subsection (2).—(Lord Polwarth.)
Clause 127, as amended, agreed to.
10.40 p.m.
LORD POLWARTH LORD POLWARTH moved Amendment No. 117:
After Clause 127 insert the following new clause:
Educational endowments
"127A.—(1) Where, immediately before 16th May 1975, any educational endowment is to any extent vested in the existing local authority for an area specified in the first column of Table A below, that endowment shall on that day to that extent be transferred to and vest for the same purposes in the appropriate new local authority for the area specified in relation thereto in the second column of that Table.

TABLE A

Existing area

New area

County

Region or islands area.

County of a city

Large burgh

District or islands area.

Small burgh

District

(2) Where, immediately before 16th May 1975, any educational endowment is to any extent to be vested, by virtue of his office, in the holder of any office connected with an existing local authority specified in the first column of Table B below, that endowment shall on that day to that extent be transferred to and vest for the same purposes in the holder of the office, specified in relation thereto in the second column of that Table, of the
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appropriate new local authority as determined by reference to subsection (1) above.

TABLE B

Existing office-holder

New office-holder

Lord Provost

Chairman of council.

Provost

Convener of county

Chairman of district council

Magistrate

Councillor, or any other person nominated by the council.

Councillor

Chairman of a member of a committee

Any specified officer

The corresponding officer or (if there is no such officer) the proper officer.

(3) Where, immediately before 16th May 1975, any power with respect to an educational endowment is vested in an existing local authority, or (by virtue of his office) in the holder of an office connected with such an authority, that power shall on that day be transferred to and vest in the appropriate new local authority or (as the case may be) in the new office-holder of that authority, as ascertained by reference to subsections (1) and (2) above.
(4) Subject to the provisions of the governing instrument of an educational endowment, where, as the result of the election of a local authority occurring after 16th May 1975, it is necessary for a person to be nominated by the authority or by a committee thereof to be vested (to any extent) with the endowment, in terms of subsection (2) above, or to be vested with any power, in terms of subsection (3) above, that person shall be so nominated at the first meeting of the authority or committee held after it has been elected or appointed; and in such a case the person who (to the said extent) was last vested with the endowment or, as the case may be, who was last vested with the power, before the meeting shall continue therein until the date of the meeting.
(5) In this section, unless the context otherwise requires, expressions used in Part VI of the Education (Scotland) Act 1962 have the same meaning as in that Part, and "the appropriate new local authority" means, in relation to an existing local authority, the new authority whose area comprises the whole or the greater part of the area of the existing authority: and if, in any case, there is a dispute as to such appropriate authority, or as the person or persons corresponding to an existing

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office-holder or office-holders for the purposes of this section, it shall be taken to be such new local authority or, as the case may be, person or persons as the Secretary of State may direct.
(6) Nothing in this section shall affect any other power to reorganise any educational endowment or otherwise to alter the provisions of any trust.")
The noble Lord said: The object and effect of this new clause is to transfer to the appropriate regional islands or district authorities educational endowments vested in existing local authorities, and to replace by the appropriate representatives of the new authorities members or representatives of the existing local authorities who are included on the Government bodies and other educational endowments.
Because educational endowments confer specified benefits on specified persons or categories of persons and on specified places or areas, they cannot simply be included with other existing educational facilities and services in the total educational resources to be administered by the new authorities as education authorities. Although many educational endowments are in practice largely integrated with the public educational services, they confer closely defined benefits to which the prescribed beneficiaries, and only they, could if necessary lay claim by appealing to the courts. It would be quite impossible to attempt to amend each educational endowment scheme (there are about 160) and the governing instruments of each unschemed educational endowment, of which there are about 1,500 on the Register of Educational Endowments, to bring them into conformity with the new local government structure by May, 1975.
On the other hand, if no action were taken, a great many educational endowments, including the 35 area trust schemes based on existing educational authority areas and which result from the amalgamation of previous separate educational endowments, would become inoperable. The new clause has the effect of securing the continued operation of educational endowments without change in their purposes, beneficiaries or areas of benefit. This is a necessary provision, and I ask your Lordships to accept the Amendment.
Clause 128 agreed to.
Schedule 10 [Arrangements by education authorities for discharge of their functions.]
THE EARL OF BALFOUR THE EARL OF BALFOUR moved Amendment No. 118:
Page 178, line 50, at end insert ("or local authority officials").
The noble Earl said: Paragraph 6 of Schedule 10 at the bottom of page 178 reads:
"No arrangement shall be made by an education authority for the discharge otherwise than by their education committee of any function in regard to the dismissal of teachers."
"Or local authority officials" are the words I should like to insert at the end. I feel that the Director of Education, and people like him, should have the same sort of protection. I beg to move.
LORD POLWARTH: As the noble Earl has said, there are existing provisions for dealing with the case of teachers, and they have a special provision because there is provision in the Education (Scotland) Act 1962 which deals with the position of the dismissal of teachers, and the assumption is that this is action to be taken only by the education authority or by the education committee. The powers there are extensive and considerable, but the other categories, I would submit, are different. There is at present some protection for the Director of Education in respect of dismissal. This was mentioned by the noble Earl. That is being repealed in this Bill, but with the knowledge of the Association of Directors of Education who have raised no objection to its repeal. There is no special protection for other categories—one thinks of administrative staff, janitors and so on. I do not see there is any special need in that respect. They come within the normal practices for dealing with employees in general and I do not think they need to be accorded a special position. I think we should leave it to the discretion of and proper handling by the new authorities without according to one group of staff a special position.
THE EARL OF BALFOUR: I raised this point because it had been brought to my attention, but with the assurance that the Association are quite happy

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about it, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Schedule 11 [Amendments of the Education (Scotland) Act 1962]:
10.45 p.m.
LORD BALERNO LORD BALERNO moved Amendment No. 119:
Page 180, line 7, at end insert—
("5A. After section 24 the following new section shall be inserted—
('Pupils at secondary school in final or penultimate year.
24A. Where, in consequence of the coming into force of the Local Government (Scotland) Act 1973 or any boundary change under Part II of that Act, pupils at a secondary school have to be transferred to another secondary school such pupils who, after the appointed day will enter their final or their penultimate year, may with parental consent complete their school education at the school they attended immediately before the appointed day'.")
The noble Lord said: The purpose of this Amendment is to "mak sicear" that the new education authorities do not allow prejudice to overcome them, or any single one of them, and to ensure that pupils who are in their final or penultimate year at a secondary school, sitting their "O" level or "A" level exams, can, if they so wish and with their parents' consent, remain at that school to the conclusion of their education irrespective of the fact that the drawing up of the new boundaries may have put that school from the area of one education authority into that of another education authority. One would like to think that the possibility of this happening is remote, but I have myself had experience of the prejudice of an education committee in Scotland, and this, I believe, is not a single instance. The education committee, because it was so determined that children in its own area should be educated in its own area, sent some of the children of Currie, before a secondary school was built there, 12 miles to West Calder by bus every day, and sent some of the children by public transport right across Edinburgh to the burgh of Musselburgh while there were two secondary schools belonging to the Edinburgh education authority within three miles of Currie, both of which had vacancies and would have been delighted to have taken these pupils. That was a matter of sheer prejudice. The cost to
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the education committee of Midlothian was considerably greater in that they had to pay for the transporting of these children. They would have had the children educated in the Edinburgh school for £15 apiece, I understand, at that time. This Amendment would prevent a nonsense like that again arising. It is a precautionary Amendment, but I think it might be an important one in the lives of half a dozen young persons.
THE EARL OF BALFOUR: I am most grateful for the assistance of my noble friend Lord Balerno in trying to draft this rather difficult Amendment. I must stress that what I am far more concerned about than anything else here is that it is in this last year or the year previous that a child participates in the most important exams. I think to be made to change schools at that stage could be disastrous to the child's future. This is only intended as a temporary measure, but it could crop up again with any decision of the Boundary Commission. I cannot believe that there could be many children affected, and I ask my noble friend to consider the matter very carefully.
LORD POLWARTH: I have very great sympathy with the object of this Amendment as it has been explained by the noble Lord, but with great respect I do not think that I can recommend your Lordships to accept it. In the first place, in the form in which it has been put down—and I appreciate that some difficulty has been experienced in drafting it—I do no think it would entirely have the desired effect. It applies to all secondary school pupils in attendance at the schools concerned immediately before the appointed day and who will begin their final or penultimate year after that date. In those circumstances, it would include pupils in their first year of seconary education and it would exclude pupils who at the appointed day had already begun their penultimate or final school year.
THE EARL OF BALFOUR: This is the whole purpose. It is those children who are just in the final stages before they go for their examinations. Do not make them move school in almost their last year; that is the whole point.
LORD POLWARTH: But the Amendment would not include those who had

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already begun this final year or penultimate year. The wording is faulty; I do not think this is what noble Lords intended. There are other drafting imperfections with which I will not concern your Lordships. I doubt whether this is a matter on which we should lay down an absolute hard and fast rule. I submit that, in spite of the apparently stupid arrangement which the noble Lord, Lord Balerno, mentioned in a particular case, this is a matter where we should rely on the good sense of education authorities. The fact of changes occurring under this Bill does not necessarily mean that pupils will have to move from one school to another. There are perfectly good powers available under the Education (Scotland) Act 1962 (Section 24) enabling an education authority to provide education for pupils belonging to the area of another authority. At present many authorities provide education for pupils who live outside their areas, and we do not have any evidence to suggest that the new authorities will not be prepared, where appropriate, to continue existing arrangements or where necessary make new arrangements.
There may in due course have to be schemes of rearrangement, but we have no reason to think that the authorities will act unreasonably in this matter or fail to have regard to the best interests of the pupils concerned. I would suggest that in pursuance of the policy of giving to the new authorities the maximum discretion in the management of their own affairs we should trust them to act wisely and use their discretion responsibly, and I should have thought it was quite wrong to suggest that the future education authorities would be less to be relied on than the existing ones and should be subjected to this new restriction. I am sure that this is a matter on which their attention could very properly be drawn to the importance of continuity of schooling, but I submit that it is not right to write it into this Act.
LORD BALERNO: I would only say that in the past there have been some education authorities who have been prejudiced in this way and who have done precisely what my noble friend says they will not do in the future. This Amendment is to prevent any authority from erring in the future, especially in
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this difficult period when the schools may be changed from one education authority to another. I really cannot see why the noble Lord cannot accept this Amendment, and I am very reluctant not to press it.
THE EARL OF BALFOUR: Let me give your Lordships one example. May I ask you to look at page 151, line 26, where it says:
"In the county of Midlothian—the electoral division of Heriot and Stow."
At the present moment I rather think the children in secondary education go all the way to Dalkeith. Now that it is being transferred to Ettrick Forest they will in future go to Galashiels—I admit probably a little nearer. It is a dreadful thing to take a child away in the last or second last year of school, going from one direction to the other direction, when it is coming to an important examination. This is a difference of nearly 40 miles. It is a problem.
10.55 p.m.
THE EARL OF SELKIRK: The noble Lord, Lord Polwarth, said that he had not heard of any local authorities that have done this. Of course he has not. None of them are going to tell the Government that they are doing this sort of stupid thing. The noble Lord said that this Amendment is defective. It would be very easy to make it non-defective. If he will not go so far as that, will he undertake to draw this matter to the attention of the local authorities? It is one upon which those concerned with education feel very strongly indeed. I wonder whether he could make any suggestion, as it would be simple to change it for children in the last year or who enter immediately after the date. I cannot believe that it is going to affect more than a few people, and it is not asking very much of the Government.
LORD HOY: Midlothian County Council have a very good record educationally, and I cannot believe that we should have an Amendment to a Bill to cover a very few people. Knowing the area very well indeed, I can say there is always great accommodation to meet the needs of the pupils in this respect. When they are moving into their last year they are always given continuity of education

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are always given continuity of education if it is possible for the authority to provide it. As to the conflict between Edinburgh and Midlothian, I may say that there has not been great co-operation in all the years I have known them, but I can claim that I have been living there all my life and was educated there, and we have never had any difficulty in this respect. This is not a matter for an Act of Parliament. We do not require to pass an Act of Parliament to put it right. With a little administrative intelligence the whole thing can be sorted out. I am certain that between the education authorities in Midlothian and Edinburgh it might well be undertaken without passing an Act of Parliament to make it possible.
LORD BALERNO: The case I gave was one that happened between Midlothian and Edinburgh. Edinburgh, of which the noble Lord, Lord Hoy, is an eminent citizen, was certainly most cooperative; it was the then stupidity of the Midlothian education authority that caused these things to happen, and that is what I wish to guard against in the future. I agree with the noble Lord that the Midlothian education committee is now a most respectable committee. It is quite a different committee, and it is perhaps one of the better education committees in the whole of Scotland, but I was giving this case as an actual instance of what has happened. I have every reason to believe that similar things have happened in other parts in the past. All I want to do is to prevent this stupidity from happening again. This is a very simple Amendment; it is only to tide us over a short time, but it can be very important for just a few children.
LORD HOY: What the noble Lord is saying is that the Midlothian education committee in the past might have been a little foolish in certain things but that they have now such a good committee that it cannot happen in the future, and I am willing to accept his judgment on that matter. All I am saying is that with a little administrative persuasion the whole thing can be put right. If your Lordships are going to pass an Amendment to do what the noble Lord says, we are really doing it to cover three to six people in the village of Currie. I have great respect for Currie, but I do not
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think that we should overdo it in importance. This matter can be sorted out administratively. All I am saying is that we do not require an Act of Parliament to do it, and I am certain that in the future, if there are pupils from Currie who have to go on to further courses to complete their "A" or "O" levels, this can be done by a little co-operation between Edinburgh and Midlothian, and we shall not require an Act of Parliament to put it right.
LORD BALERNO: I was in no way pleading for Currie. In Currie we have an excellent secondary school, and when the Bill comes into force as an Act it will go into Edinburgh. There will be no trouble there at all. But there are other places where a school is moved into another education area.
LORD POLWARTH: I am grateful to the noble Lord, Lord Hoy, for explaining the position better than I have been able to do. I absolutely understand the feelings on this matter and have every sympathy with them, but I submit that this is not a matter for a statutory restriction on authorities, to whom we are trying to give the maximum freedom. I should be very happy to convey the thought to my colleagues that this should be dealt with by advice and guidance from us, giving the authorities the opportunity to act on their own initiative. But I could not possibly accept this Amendment in its present form, because it is defective.
THE EARL OF BALFOUR: I beg leave to withdraw the Amendment.
THE DEPUTY CHAIRMAN OF COMMITTEES (LORD CHAMPION): Only the mover can withdraw an Amendment.
LORD BALERNO: My noble friend has used that phrase so often that it comes to him very naturally. Can the noble Lord, Lord Polwarth, give an assurance that, in the event of any cases like this coming to light, he will endeavour to draw the attention of the secretary of his right honourable friend to it and will get it put right at that level?
LORD POLWARTH: The noble Lord will appreciate that it would be very difficult for me to give any detailed commitment about what may happen after May, 1975.
LORD BALERNO: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Schedule 11 agreed to.
Clauses 129 to 131 agreed to.
Schedule 12 [Amendment of enactments relating to housing]:
LORD POLWARTH LORD POLWARTH moved Amendment No. 120:
Page 183, line 22, after ("allowances") insert ("—

(a) for the word "1947" there shall be substituted the word "1973";

(b)")

The noble Lord said: I hope your Lordships will accept my assurance that this is purely a drafting Amendment, as is the subsequent one. I beg to move.
Schedule 12, as amended, agreed to.
Schedule 13 [Amendments of the Rent (Scotland) Act 1971]:
LORD POLWARTH: I beg to move Amendment No. 121.
Amendment moved—
Page 183, line 37, leave out ("1947") and insert ("1973")—(Lord Polwarth.)
Schedule 13, as amended, agreed to.
Clause 132 agreed to.
Schedule 14 [Amendment of Enactments relating to Roads]:
THE EARL OF BALFOUR THE EARL OF BALFOUR had given Notice of his intention to move Amendment No. 122:
Page 196, line 13, leave out paragraph 53.
The noble Earl said: I have been approached by various sections of the Committee, and I am quite happy not to move the rest of the Amendments standing in my name on the Marshalled List, and to come back at Report stage.
THE DEPUTY CHAIRMAN OF COMMITTEES: The difficulty is that I shall have to call all of those Amendments.
Schedule 14 agreed to.
Clause 133 [Building]:
11.4 p.m.
THE EARL OF CROMARTIE THE EARL OF CROMARTIE moved Amendment No. 124:
Page 77, line 1, leave out ("Highland").
The noble Earl said: I have been extremely brief in moving every other Amendment that I have produced, unlike some people this evening. I shall not be quite so brief this time, though I shall be as brief as possible. This is a vital Amendment so far as the Highland region is concerned, a fact which I hope the Minister will accept. But if he feels unable to accept this Amendment, I trust that all noble Lords who know something of the Highland region and the great changes that are taking place will support me in the Lobby. What I said on Second Reading was that the best qualified people to direct the operation of the duties of the building authority are already within the district authorities where the building will take place.
The Highland region is vast, and while my own county, to be the District, of Ross and Cromarty is the very centre of the oil and, therefore, building developments, the most recent developments are taking place to the North, North-East and North-West of Ross and Cromarty, and this means the existing county, which includes the Island of Lewis and the counties of Sutherland and Caithness. Surely it is obvious that those who are going to be the king-pins of intensive building activity should be those who are experienced and on the spot. The fact that the Minister says that these individuals will be moved to regional headquarters—that is to say, Inverness—only strengthens my case. I would suggest that this is a case of centralisation for the sake of centralisation. There is no logical reason why they should be moved to Inverness at all. I hope the Minister will not tell us that a magnificent addition to the A.9 road is to be started, together with bridges over the Moray and Cromarty Firths. Years will pass before this is completed; neither will it have very much effect on the new and probably extensive North-West oilfields South-West of Orkney. I beg to move.
THE DUKE OF ATHOLL: I should like to support my noble friend. I think it is essential that local government should be

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local, particularly in the very scattered and very large, geographically, Highland region, and I feel that this Amendment would help to this end.
LORD POLWARTH: I think that the fears of the noble Earl about centralisation are, if I may say so, greatly exaggerated. There is nothing in the Bill to prevent devolution of functions, devolution of offices and that kind of thing, and I am quite sure that the new authorities will make use of these powers. I think there is a very important point here in relation to building control. Building control is, as we know, to be a regional function in the Highlands and in the Borders and Dumfries and Galloway Regions, where local planning is also to be dealt with at regional level, unlike the case in the other regions. While we recognise that there are connections between building control and housing, there is in fact a much closer link between building control and local planning, particularly where it concerns development control and applications for planning permission. We feel—and I think this view has been quite widely accepted—that there is advantage from the point of view of the member of the public who is making application to the local authority, as well as benefit to the local authorities themselves, in having arrangements, where applications for building warrants and planning permission are involved, to see that building control and development control are dealt with by the same authority, and that therefore there will be only one place for the applicant to go instead of more than one. I think the noble Earl's fears are exaggerated. However, in view of the late hour, I am quite prepared to take this away and consider it further, but without any definite commitment to making an alteration in the Bill.
THE EARL OF CROMARTIE: In view of this rather unexpected concession from my noble friend the Minister, and remembering that there is another stage of this Bill, I beg leave to withdraw the Amendment for the time being.
LORD HUGHES: Before the noble Earl withdraws the Amendment—and I want him to withdraw it—I hope he is not under any misapprehension that he has a concession. There are not enough
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people to keep the Committee going if we divide, so we cannot afford to have a Division. So the noble Earl has got nothing.
Amendment, by leave, withdrawn.
Clause 133 agreed to.
Schedule 15 agreed to.
Clause 134 [Prevention of river pollution]:
11.10 p.m.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 127:
Page 78, line 25, leave out ("the councils aforesaid") and insert ("regional councils")
The noble Lord said: The Government are grateful to my noble friend Lord Balfour for putting down Amendment No. 129. This Amendment gives effect to what the noble Earl desires, which is that the expenses of the river purification board, so far as they are not defrayed out of revenue, shall be defrayed by the regions and not by the regions and the districts.
LORD DRUMALBYN: I beg to move Amendment No. 128. This is a drafting Amendment designed to correct a reference to existing local authorities in Clause 134(7).
Amendment moved—
Page 78, line 43, leave out ("existing local authorities") and insert ("councils of counties and large burghs")—(Lord Drumalbyn.)
Clause 134, as amended, agreed to.
Schedule 16 [Amendment of Enactments relating to River Purification]:
LORD DRUMALBYN: On behalf of my noble friend Lord Balfour, I beg to move Amendment No. 129.
Amendment moved—
Page 204, line 29, leave out paragraph 1 and insert—
("1. In section 6(1) (financial provisions) for the words 'counties and large burghs whose districts' there shall be substituted the words `regions whose areas' and for the words' administrative scheme of there shall be substituted the words 'order constituting'.")—(Lord Drumalbyn.)
THE DUKE OF ATHOLL: I have handed in a Manuscript Amendment which comes before Amendment No. 130.

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This Amendment would be necessary if by any chance the Committee accepted Amendment No. 211. If the Government tell me that they are going to accept that Amendment, I should like to move this Manuscript Amendment also; but otherwise it is redundant. If the Government are not going to accept Amendment No. 211 I do not think it is a point worth pursuing at this late hour and I am prepared to leave it until Report stage. I beg to move.
Manuscript Amendment moved—
Page 204, leave out lines 29 to 31.—(The Duke of Atholl.)
LORD DRUMALBYN: I am afraid that we cannot accept Amendment No. 211.
TIIE DUKE OF ATHOLL: In that case, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
THE DUKE OF ATHOLL THE DUKE OF ATHOLL moved Amendment No. 130:
Page 204, line 35, leave out ("133") and insert ("134").
The noble Duke said: I am more hopeful that the Government will accept this Amendment. When reading through a Bill I nearly always start with the Schedules because they seem to contain the meat of the matter. In Schedule 16 one finds a reference on page 204 in line 35 to "section 133 of this Act." Clause 133 (which will be section 133 when enacted) deals with buildings and makes no mention of a board which has been established under that section. I think it must be intended that this reference should be to "section 134."
LORD DRUMALBYN: My noble friend is quite right. I am obliged to him. I accept the Amendment.
LORD DRUMALBYN: This is a drafting Amendment. I beg to move Amendment No. 133.
Amendment moved—
Page 205, leave out from beginning of line 21 to ("for") in line 22.—(Lord Drumalbyn.)
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 134:
Page 205, line 27, at end insert—
("In section 29(4) (application of Act to tidal waters), the words from" subject "onwards shall cease to have effect.")
The noble Lord said: This Amendment goes with Amendment 214. Here again I am grateful to my noble friend Lord Balfour for drawing attention to a point at which the Bill can be improved. He had down an Amendment, but it was defective and we could not accept it. This Amendment repeals the modification that reference to councils of large burghs shall include a reference to purification boards, which is unnecessary.
Schedule 16, as amended, agreed to.
Clauses 135 to 144 agreed to.
Clause 145 [Police]:
LORD DRUMALBYN: This Amendment goes with Amendments Nos. 137 and 138. They are all drafting Amendments, required for clarity as a consequence of some Amendments made on Report stage in another place. I beg to move Amendments Nos. 136, 137 and 138 en bloc.
Amendments moved—
Page 84, line 24, after ("or") insert ("in subsection").
Page 84, line 26, leave out ("that subsection ") and insert ("subsection (1) above").
Page 84, line 44, leave out ("section") and insert ("subsection ")—(Lord Drumalbyn.)
Clause 145, as amended, agreed to.
Clause 146 agreed to.
Clause 147 [Water]:
11.20 p.m.
LORD HUGHES LORD HUGHES moved Amendment No. 138A:
Page 88, line 23, at end insert—
("That part of the former County of Kincardine which lies within both the Grampian Region and the region of the East of Scotland Water Board. Tayside.")
The noble Lord said: This Amendment is to make the part of the former county of Kincardine which lies within the Grampian region and the region of the East of Scotland Water Board an added area for the Tayside region. I

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am not seeking to import any new principle into the Bill in doing this; I am tidying it up. There were two opportunities available to the Government in this Bill to do what had been recommended to them—to continue water boards in existence. This subject was fully discussed in another place and it was decided that it would become the function of regional authorities. But because not even the ingenuity of this Government or any of their predecessors could make water run uphill, it has been necessary, for some reason which I cannot understand, to alter the boundaries for water purposes by having added areas.
The Minister in another place said that the arguments for doing it as it is in the Bill, or making this part an added area to Tayside as had been done in the other two parts of the county, were very finely balanced. That being the case, if the arguments are so finely balanced that they can go either way—and this is what was said—the way it ought to be done is to apply exactly the same principle in each of the regions concerned. Remember, Wheatley made it part of the Tayside region, and this was one of the reasons why it was part of the Tayside region, but the Government succumbed to the pressures of sentiment and so on and made South Kincardineshire part of the Grampian region, a decision with which I may say I am in agreement.
I think this is a case where there is justification for doing what people want locally, but in doing it that part of the Grampian region is going to be dependent on the Tayside region for water in bulk supply. This is a part of the world where the future industrial requirements are quite unforeseeable. Because of the impact of oil and oil-based industries, the possible demand for water for industrial purposes may grow by leaps and bounds. It is going to put the people of South Kincardineshire at great risk if they are going to be dependent on Tayside's giving them a bulk supply. Where they have direct responsibility as an added area, they must treat these people in exactly the same way as anybody else in the rest of their region. I think it would be wrong if Tayside in future were placed in the position of having to choose between withdrawing a bulk supply from somebody who was merely a customer
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and giving preference to the people inside their own region. These folk are entitled to be treated in exactly the same way as the rest of the people in the Tayside region. For that reason I wish to move that, as in the other parts of Scotland, this principle be adopted and that this area be an added area for Tayside.
It is only because of the lateness of the hour that I am speaking so quickly and for so short a period. This does not mean that the matter is not important; it is exceedingly important. Everybody concerned with water has pressed for this as a second best to preserving the water boards. I was not prepared to move that the water boards be preserved, because of the ample discussion elsewhere; but this principle, I think, is sufficiently important to be insisted upon. I beg to move.
LORD DRUMALBYN: Clearly, in a case like this there are strong arguments both ways; otherwise the decision would not have been changed as it has been. I agree with the noble Lord as to the importance of the matter, which is illustrated by the rapid growth of industrial development at Stonehaven, particularly development centred on Kincardineshire County industrial sites. This is a practical example of the importance of water supply and industrial promotion being in the hands of the same authority.
I shall try to be brief, too, but the argument against the added area—that is, the argument in favour of the bulk supply—is that proper co-ordination of services ancillary to strategic planning, including water supply, is essential to major planning and development, and in principle an authority should have control of all these services through their region. Any departure from this principle, except where it is not practicable to adhere to it, is contrary to one of the fundamental principles laid down by the Royal Commission. The alternative of a bulk supply is practicable. Water from Loch Lee in the Tayside region enters Kincardineshire by a single pipeline, and meters are already in position to measure the supply. This would leave the Grampion region in full control of distribution and directly accountable to its electorate. The "added area" arrangement, with provision for representatives of the Grampion region on the

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Tayside region for water supply functions, but obviously in a small minority, and the requisition on the Grampion region to pay for the supply, would give less control and involve unnecessary complications. I cannot believe, if supply obligations are accepted for a neighbouring territory, that fair play would not exist. Such arrangements have existed between local authorities for a considerable time, and I am sure they would be honoured.
LORD HUGHES: But this is a new bulk supply agreement that would need to be entered into, and I would think that the Tayside region would be extremely foolish to enter into a bulk supply arrangement for anything but a limited period. The one thing that is quite certain is that the Grampion area is not in a position to give this water from its own resources for a very long time ahead. It is perfectly true that it is practicable to give a bulk supply, but I am trying to safeguard against the possibility of the Tayside region—whose first obligation must be to look after people in its own region—cutting off outside supply and saying, "We are very sorry, but this is your responsibility. We are not going to supply any more water under a bulk supply arrangement because we now need it ourselves. It is better that you should go short rather than that we should." I am not saying that will happen within a week or so, but obviously the Tayside region is not going to enter into anything other than a short-term commitment for bulk supply. It would be unreasonable for it to do anything else. So the Government are making a great mistake here.
The Minister said it was finely balanced and that justice could easily go one way or the other. Because this matter was considered after the Committee had been sitting for a long time, I think the reasonable thing to do is to give the other place another chance to look at it. I would suggest that the Minister should allow this to go into the Bill—it at least applies the same principle throughout Scotland—and I certainly could give an undertaking that if, on further consideration, the other place wishes to stick to its decision, I should be perfectly willing to accept that. But because this is an
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area I know, I believe they ought to look at the matter again. I know the feelings of the water authority, and I believe the Minister is optimistic if he thinks that they will commit themselves for a long time ahead. If these considerations are put to another place, they may yet agree that this is the right thing to do. We are not asking them to do anything in regard to something that they threw out overwhelmingly: it was just a question of fine balance. It was interesting that one of the Members of Parliament concerned put this case most strongly for the area.
I would plead with the Minister to do it this way, on the assurance that I will not make trouble if that is the way the other place wants to do it. Otherwise I am placed in an impossible position, because I would wish to divide the Committee on this question. If we do divide we are in grave danger of bringing the proceedings to an early termination—though I would not altogether regret that. However, I think that whether there are 25 people or 125 people present, it is reasonable that this matter should go back to the other place in order to be looked at again.
LORD BALERNO: Before the noble Lord sits down, may I ask him—he having the greatest knowledge of anyone in the Chamber—whether he knows the county boundary which runs between Kincardine and Angus, as it runs up the River Esk, and whether it is the fact that the Loch from which this water comes is half in one county and half in the other?
LORD HUGHES: It might be; I could not say. What I do know is it has not been suggested that the Grampian region will be able to lay claim to half the loch.
LORD BALERNO: The main question is perhaps not so much the water taken from South Kincardine, but that the Fettercairn distillery should not be removed from Kincardine.
LORD DRUMALBYN: The noble Lord, Lord Hughes, has put the same sort of pressure on me as he anticipates Tayside will put upon the Grampian region. The noble Lord is not right in saying that the Tayside region might refuse to give us bulk supplies and get away

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with it. In such circumstances the Secretary of State may make an order requiring them to do so. I think the noble Lord's premise is wrong there, and what does he say to that?
LORD HUGHES: If the result was that the Secretary of State was depriving the Tayside region of the opportunity of getting industry in, he would be in more trouble than he is at the present time.
LORD DRUMALBYN: The fact remains that the noble Lord's premise is wrong. We are in the great difficulty that if we do as the noble Lord says this will go as a recommendation of the House of Lords, as the opinion of the House of Lords. I want to make it plain that the opinion of the House of Lords has not been taken on this. Having made that plain, I will not oppose the Amendment.
THE DUKE OF ATHOLL THE DUKE OF ATHOLL moved Amendment No. 139:
Page 89, line 15, at end insert—
("(8A) In the exercise of their functions under the Water (Scotland) Acts 1946 to 1967 a water authority shall have power to enter into and make payments under wayleave agreements.")
The noble Duke said: The effect of this Amendment is to enable the water authority to enter land for the purposes of carrying out their functions to make payments under wayleave agreements. A water authority is given general powers under this section to provide water mains. This is the 1946 Act. But there is no requirement to enter into any wayleave agreement or to pay any rent or other payments for rights to construct a water main on the land. As is known, all other statutory undertakers, such as the electricity authority and gas board, require both to enter into wayleave agreements and pay for the right to instal electricity pylons or gas pipes over, through or under land. There seems no reason to me why the water authorities should not be put in the same position as these other statutory authorities. I beg to move.
LORD DRUMALBYN: My difficulty here is that this Bill is concerned with the re-structuring of Scottish local government. It is not the appropriate vehicle for alterations to the statutory operational powers of water undertakers. This
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is particularly true of matters affecting the fundamental relations between them and private interests. Discussions have been taking place with the British Waterworks Association, who represent undertakers throughout Britain. The correct procedure here is for discussions to continue and for the conclusions, with, we would hope, a substantial measure of agreement, to be submitted for consideration to the Government in connection with the first suitable legislation which may be under consideration. I agree that the gas and electricity undertakers operate differently, but the fact of the matter is that the power to lay water mains has existed since before the beginning of the century and this is a fundamental change which my noble friend is proposing. The powers of water authorities are of very long standing and they have operated reasonably well for many years.
There is nothing new, as I said, in the water authorities having the right to lay and maintain mains. Since the end of the last century water authorities in Scotland have been empowered to do so on giving reasonable notice to the owner and occupier of the land and they may from time to time inspect, repair, maintain, alter or renew or may at any time remove the main already laid. Where they exercise these powers the undertakers must from time to time pay compensation to every person interested in the land for any damage done to or any injurious affection of the land by reason of the laying of the main.
LORD HOY: Does that include Blair Atholl?
LORD DRUMALBYN: And where there is a dispute as to the amount of compensation to be paid it has to be determined by arbitration.
Section 26 of the Water (Scotland) Act confers the present power on regional water boards and water development boards to lay mains after giving reasonable notice to the owners and occupiers of the land concerned; it also provides for payment of compensation for damage done to land or injurious affection of the land. Such compensation is payable whether the damage does or does not result from actual negligence, and in this respect the Amendment adds nothing to the clause. Compensation for damage

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resulting from a burst may well be payable under Section 12 of the 1946 Act which provides for compensation being paid,
"to any person who has sustained damage by reason of the exercise by the authority of any of their powers"
under that Act. But the legal position has never been actually tested in the courts. The fact is quite plain that the reason why it has never been tested in the courts is that on every occasion where a dispute has arisen it has been settled amicably and compensation must have been paid. So I really do not think my noble friend has very much to fear here.
Of course, the point about requiring a wayleave to be given is that as the tendency now is for mains to run over a wide part of Scotland, the mere refusal by one of the parties to give the way-leave would result in the matter going to court. This is something which has been avoided in the past and I think it would on the whole be undesirable to create it in this way at the present time, and certainly it would be undesirable to create it in this Bill.
THE DUKE OF ATHOLL: I had a feeling that my noble friend might say that this particular subsection did not fit very happily into this Bill; and for that reason I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 147 agreed to.
Schedule 17 agreed to.
Clauses 148 and 149 agreed to.
Schedule 18 [Amendment of certain enactments relating to transport]:
LORD DRUMALBYN LORD DRUMALBYN moved Amendments Nos. 143 to 146:
Page 215, line 40, leave out paragraph 2 and insert—
("2. In section 10 (powers of Executive), the following amendments shall be made—

(a) in subsection (1)(xvi), the words, "and the consent of the Minister" shall cease to have effect;

(b) for the word "county", in both places where it occurs, there shall be substituted the word "region".");

Page 216, line 70 at end insert—
("Section 11(4) shall cease to have effect.");
Page 217, line 36, at end insert ("and in the said section 16, in subsection (2), the
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words from "and (d)" onwards, and subsections (3), (4) and (5) shall cease to have effect.
In section 18 (planning of passenger transport services in designated areas), the following amendments shall be made—

(a) in subsection (1), the words "to the Minister and" shall cease to have effect;

(b) in subsection (2), the words "to the Minister and" shall cease to have effect.

In section 21 (functions of traffic commissioners in designated areas), subsection (5)(a) shall cease to have effect.")
Page 219, line 10, after ("12") insert ("14").
The noble Lord said: May I suggest that we deal with Amendments Nos. 143, 144, 145 and 146 together. This is a series of Amendments designed to relax certain of the controls at present exercised by the Secretary of State over passenger transport authorities and executives. A Schedule to relax 50 controls was put in at Report stage in the House of Commons. I will willingly describe these relaxations if the Committee wishes, but it may be sufficient if I simply move.
Schedule 18, as amended, agreed to.
Clauses 150 to 152 agreed to.
Clause 153 [Piers and harbours]:
11.40 p.m.
THE DUKE OF ATHOLL THE DUKE OF ATHOLL moved Amendment No. 147A:
Page 93, line 10, leave out ("regional") and insert ("district").
The noble Duke said: I have agreed with my noble friend Lord Inchyra that I should open the batting, to speak on the general application, and that he should speak on the more particular application of these Amendments. If it is to the convenience of the Committee I should like to speak to all the Amendments to Clause 153 and Schedule 19 standing in the names of my noble friend and myself.
The object of these Amendments is to place local authority harbours, and only local authority harbours—not the larger ones like Aberdeen and Dundee and Leith—under district councils and not regional councils. The history of these Amendments is that virtually identical Amendments were carried on the Committee stage in another place, supported by Members of both the Parties represented on the Committee. The Government whipped up, or whipped in (I am

1335
not quite sure which is the right word) many English and even some Welsh gentlemen to oppose these particular Amendments at the Report stage in another place.
LORD HUGHES: Shame!
THE DUKE OF ATHOLL: I could not agree more. Unfortunately, they succeded in reversing the decision which had been arrived at by the Scots on the Committee stage. The Under-Secretary agreed to send a circular to the regional authorities, requesting them to devolve to the districts as much as possible of the administrative responsibility for these harbours. As the Under-Secretary has agreed to do that I cannot see why he cannot agree to them coming under the control of the district councils. Among these harbours are many of the smaller fishing harbours, like Buckie and Mac-duff, to take two examples, and also the smaller transport harbour (if that is the right term) of Perth. Very few of the bigger harbours are local authority harbours, but they feel that if they go to the regional authorities they may be neglected.
I think it is true to say that in the past they have had extremely good labour relations when being run by their present local authorities, which in very many, although not in all, cases will be much the same as the new district councils. They have been economically run; they are a source of local pride; they have very little regional trade. They are frightened that the harbour rules which are in operation for the bigger ports may be applied to them if they go into the regions, and it is of course easier to put the points if you are dissatisfied with the way your harbour is being run. Your district councillor rather than your regional councillor is much more likely to be on the spot. I feel there is every advantage in keeping these mostly small harbours in with the district authorities. I feel this most strongly, and I consider that the decision of the Scots in the other place was right and that the decision when the English and Welsh were added was entirely wrong. I am rather disappointed to see the noble Lord, Lord Davies of Leek, here tonight; otherwise I think we are all Scots. Although I must admit that in the Wheatley Report regional control for these harbours was
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recommended, it appears that they did not consider the matter too deeply and did not realise how controversial it was going to be. There do not seem to have been any direct submissions on this particular matter; at any rate none were published in the evidence. I beg to move.
LORD INCHYRA: I should like to support the Amendment proposed by the noble Duke. I will do so as shortly as I can, and with particular reference to the harbour of Perth which he mentioned. I support the Amendment because this is an issue which is arousing quite a lot of feeling locally. I think the inhabitants of Perth are a little worried about what will happen to their Lord Provost, and if they see their harbour taken away, they will be more unhappy. We have heard about the importance of carrying local opinion in order to make this new scheme of local government work. On this particular issue local opinion in Perth will not be on your side.
I do not need to say much about the harbour except that it is a good harbour. It is rather peculiar in that it is 20-odd miles from the sea. It serves many local interests; it is efficiently run, and is certainly very much appreciated not only by the citizens of Perth, but by everybody round about. They are naturally unhappy at the prospect that the present efficient set-up will not be so good under a regional situation, where the headquarters will be further away and where their interests will not be so well understood. Not unnaturally, they are rather concerned that their peculiar local interests may be swallowed up by the bigger Tayside region.
We have heard a lot from noble Lords about the desirability of having close connections between local people and the new local government set-up. I am rather afraid that people in Perth will feel that if the harbour is taken away, then that connection is weakened. I quite understand all the arguments which no doubt we shall hear from the Front Bench, about the importance of regional coordination, planning and arranging financial priorities, and so on. I understand, too, that we cannot expect at this stage any special arrangements to be made for Perth in particular. But I would hope, if this Amendment is not accepted, that at least the Government will agree that in a place like Perth it

1337
would be very suitable for the detailed, day-to-day operation of the port to be delegated by the region to the district, so that at least the actual operation of the port will still be in local hands, and the local people will feel they have a direct interest in what goes on.
THE EARL OF PERTH: Bearing the title that I do, your Lordships will not be surprised that I rise to support the noble Duke and the noble Lord, Lord Inchyra. The case is a good one, and I would hope that the Government are able to accept it as it is, rather along the lines of compromise suggested by the noble Lord, Lord Inchyra.
LORD HUGHES: I support this Amendment. I feel under an obligation to help Perth from time to time. Perth must have been considered a harbour of great importance at one time, because the railway bridge across the Tay, built nearly 100 years ago, was so designed as to permit shipping to travel up beyond the railway bridge. Much more recently the road bridge was constructed in such a way that it would not in any way impede the passage of shipping further up river. It was then not only for the benefit of Perth, of course, but I think now it is solely for the benefit of Perth. Having gone to all that expense in building the bridge, I think we might expend a little more money by including the Amendments in the Bill.
11.50 p.m.
LORD DRUMALBYN: Certainly the House will feel considerable sympathy with the point of view of Perth on this matter, but it is based, I think, on fears rather than on realities. After all, Perth is a very important inland harbour; it will really be the jewel of the harbours, so far as Tayside is concerned, under the local authority, because Dundee is not under the local authority.
LORD HUGHES: Tayside region?
LORD DRUMALBYN: Yes.
LORD HUGHES: The noble Lord said that Perth harbour would be the jewel of the Tayside region—that must inevitably be the Dundee harbour.
LORD DRUMALBYN: The noble Lord started moulding before I finished my sentence. I was talking about the
1338
local authority harbour, and Dundee is not a local authority harbour. The main harbour that the region will have to operate will be Perth, and we can be quite certain that they will run it well, and will devolve the day-to-day management and control operations on a local basis. It may well be that they will establish a local harbour committee, which is possible under this Bill. I do not fear for Perth at all in this respect. If I may put it this way, I feel that a tremendous amount of justification would be needed to change the whole system from regional control to district control for all the other harbours in Scotland. There are over 230 local authority harbours in Scotland, and representations against the Government's proposals were received in the first instance from no more than nine authorities, and have been maintained only by Perth.
THE DUKE OF ATHOLL: Could the noble Lord tell us how many of those 230 harbours are actually used? I believe the number is very small, and it is very unlikely that representations would be received from those authorities whose harbours are not used.
LORD DRUMALBYN: I have not that information here, but I can tell my noble friend that the matter was not really quite so controversial as he represented it as having been in the House of Commons. He is right in saying that an Amendment was carried in Committee, but it was carried, I think, on the basis of the position of two harbours—Macduff and Banff; and Macduff has now indicated that it prefers regional control. Then at the Report stage in the Commons there was no Division; the Amendment was negatived. So I am afraid that I cannot agree with my noble friend that it was the Englishmen who rallied to the support to defeat the Scots in the Commons.
The substance of this matter surely is the main argument of the recommendation of the Wheatley Commission and the arguments behind it. Where harbours are important for transport purposes, there will be considerable advantage in their operation being related to the regional transportation policy because all other transport powers are regional. Where harbours are primarily used for fisheries, regional administration will

1339
secure co-ordination. My noble friend Lord Inchyra is quite right in saying that I used the word "co-ordination" of harbour development, that it will facilitate the further rationalisation of arrangements for revenue from landing dues which the fishing industry is already moving towards.
I must also say that the views of existing local authorities which control harbours are generally in favour of the Wheatley proposals. The main objection among those authorities which opposed the proposals was the fear of local control, but there is nothing in the Bill that prevents the harbours from being managed locally. I think these are overwhelming facts, and it would be very difficult to justify the acceptance of my noble friend's Amendment simply on the basis of the one case of Perth. Even though the inhabitants of Perth would prefer at the present time to retain control of their own harbour in their own district—but not as the City of Perth—I do not believe there is any chance of an adverse result from the transfer of the harbour to the regional authority.
THE EARL OF SELKIRK: Can the noble Lord tell me where under Clause 153 the region could delegate the manage-merit of the harbour so that it could be locally controlled?
LORD DRUMALBYN: There is a general power to delegate. I said there was nothing to prevent its being done.
THE DUKE OF ATHOLL: In answer to my noble friend, I think it is Clause 56 under which it is possible for control to be delegated to the district.
LORD DRUMALBYN: There is no special power in the clause, but that is the clause which gives general powers of delegation.
THE DUKE OF ATHOLL: I know that my noble friend would not like me to divide the Committee, but I still remain unconvinced by his argument. I think these small ports are far better off controlled by the districts rather than by the regions. I do not think the coordination of regional transport really means anything. Perth is going to be at the centre of regional transport whatever happens to the harbour. The same applies to the ether harbours such as
1340
Buckie and Macduff. I would agree that if the Government were going to nationalise all harbours, which I think the Party opposite wish to do, there might have been some point in having them in regions. I am not encouraging my noble friend to do this; I think it would be a disaster. But his argument would hold more water if the major harbours, as well as the minor ones, were going to be under the control of the regions. At the moment I am prepared, reluctantly, to withdraw these Amendments, but I warn my noble friend that I shall be coming back to them on Report, if I am able to be here; and if not I shall make sure that one of my other noble friends does so.
Amendment, by leave, withdrawn.
Clause 153 agreed to.
Schedule 19 agreed to.
Clauses 154 to 161 agreed to.
Schedule 20 agreed to.
Clause 162 agreed to.
Clause 163 [Public libraries, museums and art galleries]:
12.1 a.m.
BARONESS ELLIOT OF HARWOOD BARONESS ELLIOT OF HARWOOD moved Amendment No. 154:
Page 97, line 40, leave out from ("be") to end of line 42 and insert ("a regional or islands council").
The noble Baroness said: I have an interest to declare in that I am vice-president of the Scottish Library Association, and what I am going to say to-night has the full support of that Association. In moving this Amendment, I should like to speak to the two following Amendments, which are consequential. The Library Association is very anxious that libraries should be a regional service and not a district service. This is necessary for several reasons: the increasing pace and technical development of modern society; the steadily growing demands of students and educational authorities in the fields of literature, and the ever-widening range and variety of reading and requests for information. These are all features and matters of great importance, and they mean that one must have a very extensive library service. This is possible only if a considerable amount of money is available to back the library service.
It also requires a very large collection of specialist books for science, technology, sociology, the humanities, music, drama, and all the other subjects. Readers' requests have to be met for a very large range of comprehensive and different subjects. There is a need to have computer techniques to manage libraries today, and extension and coordination of services throughout the whole of an area is very important. Mobile libraries, and a speedy exchange of books, are needed if we are to serve the public as we believe they should be served.
It is important that there should be a very strong link with the education authorities, which in the new set-up are going to be on a regional basis. Therefore every reason points to the fact that the library service should be one which belongs to, and is administered from, the regions. It does not mean that the local services will not be just as good as they have always been when the libraries were divided. Books can be, and will be, divided between many local libraries; but to be fully effective in meeting the enormous demand for different types of books and so on it would be necessary to have central buying and central distribution.
I know that it is not popular to say that in England and Wales and Northern Ireland the library services are regional, but they are. That is not of itself a reason for our doing it in Scotland, but it is a fact that it is necessary to have this service on a regional basis, otherwise it will certainly not be as effective as it should be in this world today, where knowledge is expanding, books are becoming more technical, and many more people are going to universities and wanting access to books. The University of the Air is another reason why people are asking for books on a very much larger scale. I hope the Government will realise that libraries are a vital service in the education service of the country, and I feel very strongly that the library service should be on a regional basis and not on a district basis. I beg to move.
LORD STRATI-JEDEN AND CAMPBELL: In supporting the noble Baroness, Lady Elliot, I would stress that this is a matter in which the regionalisation of local government would have a really
1342
beneficial effect. The central library could be brought together so that a large sum of money would be available to accumulate a proper and far-reaching collection of books on various subjects, instead of decentralising and having a large number of small libraries none of which could possibly afford a proper collection on any subject. The distribution of books could be easily arranged and there would be no need to centralise that aspect; it could perfectly well be decentralised and delegated down to districts. Indeed, there could even be district libraries with the books required on a small scale for local issuing. But the central library should be centralised in the region, so that it could be an all-embracing collection on every type of subject. I strongly support the noble Baroness.
THE EARL OF PERTH: May I ask one question? If this Amendment is accepted in relation to libraries, will museums and art galleries also go to the regions?
BARONESS ELLIOT OF HARWOOD: My Amendment refers to libraries. I am afraid that I do not know the situation about museums and art galleries, which would clearly come in the same category. My Amendment, which I am moving on behalf of the Scottish Library Association, affects libraries only.
THE EARL OF PERTH: If I read the Amendment aright, it also covers museums and galleries; and it would be very unfortunate if that were so. Museums and galleries are surely local and not regional.
LORD POLWARTH: We all know of the noble Baroness's close involvement and interest in this sphere. While she has made some very powerful pleas for a change in the set-up, these arguments were listened to very closely in preparing the Bill. The noble Earl has made a crucial point, which is applicable to the library service as well as to museums and galleries; namely, that since the library service is mainly intended to serve local needs, this is surely an example, above all others, of what should be a district council responsibility, except in the more thinly populated regions such as the Highlands, the Borders, Dumfries and Galloway, where we are providing otherwise. During the deliberations on

1343
this Bill, your Lordships have shown yourselves anxious to give the districts as much responsibility as possible. The criticism has been that they do not have enough responsibility. This is a sterling opportunity for them to take on responsibility, and I cannot believe that they will not be equal to it. There is scope for them to collaborate in schemes if they wish, and if that will help in the provision of a wider range of books. I feel that the noble Baroness and the noble Lord who has supported this Amendment, are not doing the districts justice in suggesting that this responsibility should be removed to a higher level.
BARONESS ELLIOT OF HARWOOD: I am very disappointed in the noble Lord's reply. The fact is that it is not possible to have on a very small basis the type of library that is required for the modern world, the modern student and the modern reader. We need a central library on a very big scale, covering all the subjects, which will distribute through the districts. If the library service is divorced from the education service, there will be great complications. There will be a wastage in the buying of books, because there will be overlapping, or there will not be enough books in a particular region. I am afraid that I find this matter very unsatisfactory. I know that it was discussed in another place at some length, but the Scottish Library Association is deeply disappointed that the Government are not prepared to accept this. While I will not press this Amendment to a Division—I should have done if it had arisen at an earlier time—I shall certainly raise the matter again at Report stage. Meanwhile, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 163 agreed to.
Schedule 21 agreed to.
Clauses 164 to 169 agreed to.
{Clause 170 [War memorials]:
LORD POLWARTH: This is entirely a drafting Amendment. I beg to move.
Amendment moved—
Page 100, line I, leave out ("shall be") and insert ("were")—(Lord Polwarth.)
Clause 170, as amended, agreed to.
Clauses 171 and 172 agreed to.
Schedule 22 agreed to.
Clauses 173 to 184 agreed to.
Schedule 23 [Amendment of Enactments relating to Planning]:
LORD POLWARTH LORD POLWARTH moved Amendments Nos. 166, 167 and 168:
Page 231, line 11, at end insert—
("In section 43 (unopposed revocation or modification), the following amendments shall be made—

(a) in subsection (1), the words from "and (b)" onwards shall cease to have effect;

(b) in subsection (3), the words from "and the notice" onwards shall cease to have effect.")

Page 231, line 36, at end insert—
("( ) in subsection (3), the words "application for" shall cease to have effect;")
Page 232, line 4, at end insert—
("In section 153(1) (compensation where planning permission revoked or modified), the words from "(other" to "State)" shall cease to have effect.")
The noble Lord said: Amendments Nos. 166, 168, 227 and 229 are part of the process of removing what we consider unnecessary controls. They remove controls which the Secretary of State exercises at present in relation to the revocation or modification of planning permission. Where an order is not opposed and no compensation is involved, we now feel that there is no need for the Secretary of State's consent, and we therefore propose by these Amendments to remove this requirement. Amendment No. 167 is virtually identical because it removes a need to submit an application to the Secretary of State for confirmation concerning compensation. This, again, is the removal of an unnecessary control. I beg to move Amendments Nos. 166, 167 and 168.
Schedule 23, as amended, agreed to.
Clauses 185 to 187 agreed to.
Clause 188 [Miscellaneous licensing, registration and related matters]:
12.15 a.m.
LORD POLWARTH: This Amendment and the one following are minor technical

1345
Amendments for the tidying up of provisions in the Bill. I beg to move Amendments Nos. 169 and 170.
Amendments moved—
Page 111, line 11, after last ("the") insert ("War Charities Act 1940 (registration authority for war charities) and the")
Page 111, line 33, leave out subsection (4).—
(Lord Polwarth.)
Clause 188, as amended, agreed to.
Schedule 24 agreed to.
Clauses 189 to 196 agreed to.
Clause 197 [Inspection and deposit of documents]:
LORD POLWARTH: This Amendment No. 172, was discussed with a previous Amendment. I beg to move.
Amendment moved—
Page 115, line 25, leave out ("1971") and insert ("1973").—(Lord Polwarth.)
Clause 197 agreed to.
Clauses 198 to 208 agreed to.
Clause 209 [Removal or relaxation of controls affecting certain local authority functions]:
LORD POLWARTH LORD POLWARTH moved Amendment No. 176:
Page 123, line 34, at end insert—
("(5) In this section "local authority" includes a Passenger Transport Executive.")
The noble Lord said: The Title of the Bill expressly defines one of its purposes as the amendment of Part II of the Transport Act 1968. This again is a case of giving the Secretary of State power to remove or relax controls affecting certain local authority functions by an order subject to Affirmative Resolution and we feel it right that it should cover controls affecting Passenger Transport Executives. The point may not be of great practical consequence, as most controls over Passenger Transport Executives are being withdrawn; but it seemed reasonable to make provision for the possibility. I beg to move.
Clause 209, as amended, agreed to.
Schedule 25 [Relaxation of controls]:
LORD POLWARTH LORD POLWARTH moved Amendment No. 177:
Page 241, line 41, at end insert—
("In section 5(3) (interpretation etc.), the words from 'and the fee' onwards shall cease to have effect.")
The noble Lord said: This Amendment and No. 202 delete the provisions setting a maximum fee for the registration of animal trainers and exhibitors under the Performing Animals Regulation Act 1925 because the authorities already have freedom to set registration fees as they wish.
LORD POLWARTH LORD POLWARTH moved Amendment No. 179:
Page 245, line 10, after ("(5)") insert ("paragraph (b) and").
The noble Lord said: This is another removal of what seems a superfluous power given to the Secretary of State in connection with the notice to do with the proper maintenance of waste land and the requirement to give directions regarding this. The Secretary of State's intervention is now removed.
Schedule 25, as amended, agreed to.
LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 180:
After Schedule 25, insert the following new Schedule—

SCHEDULE 25A

  AMENDMENTS OF THE TWEED FISHERIES ACT 1969
  1. Section 3 shall cease to have effect.
  2. In section 5—

  (a) in subsection (1), for the words 'the appointed day', in both places where they occur, there shall be substituted the words '16th May 1975';

  (b) in subsection (2), the words from 'but' onwards shall cease to have effect;

  (c) after subsection (2) there shall be inserted the following subsections—

  '(2A) The representatives appointed as commissioners by a local authority shall be persons appearing to the local authority to be persons sufficiently representing the interests of those respective parts of the area of that local authority as are specified in column 3 of Schedule 1 to this Act, and the number of persons appointed in respect of each part so specified shall be in accordance with the respective numbers specified in column 4 of the said Schedule 1.

  1347

  (2B) Of the representatives appointed in respect of each specified part of the area of a local authority, the respective number specified in column 5 of the said Schedule 1 shall be persons appearing to the local authority to he persons sufficiently representing the interests of freshwater fishing associations or clubs within that part.'

  "SCHEDULE 1

  REPRESENTATIVE COMMISSIONERS

  Local Authority

  Number of Representatives

  Part of Local Authority Area represented

  Number of Representatives for each part of Local Authority Area

  Number of Representatives of associations or clubs

  1

  2

  3

  4

  5

  District Council of Merse.

  9

  Former Burgh of Coldstream

  2

  1

  Former Burgh of Duns

  2

  1

  Former Burgh of Eyemouth

  2

  1

  Remainder of the Council's area

  3

  2

  District Council of Roxburgh.

  9

  Former Burgh of Jedburgh

  2

  1

  Former Burgh of Kelso

  2

  1

  Former Burgh of Hawick

  2

  1

  Remainder of the Council's area

  3

  2

  District Council of Ettrick Forest.

  11

  Former Burgh of Selkirk

  2

  1

  Former Burgh of Lauder.

  2

  1

  Former Burgh of Galashiels

  2

  1

  Former Burgh of Melrose

  2

  1

  Remainder of the Council's area

  3

  2

  District Council of Tweeddale.

  5

  Former Burgh of Peebles

  2

  1

  Former Burgh of Innerleithen

  2

  1

  Remainder of the Council's area

  1

  —

  Berwick on Tweed District council.

  9

  Former Borough of Berwick-upon-Tweed.

  2

  1

  The rural district of Norham and Islandshires.

  2

  1

  The rural district of Glendale

  4

  3

  The remainder of the River Tweed catchment area within the County of Northumberland.

  1

  —")

  The noble Lord said: Perhaps with this Amendment we might discuss Nos. 180, 181, 226 and 232. Under Section 5(1) of the Tweed Fisheries Act 1969 certain local authorities in the River Tweed catchment area were authorised on or before February 1, 1970, to appoint specified numbers of people to act as representative commissioners for the purposes of the Act. The local authorities concerned and the number of representatives appropriate are specified in columns 1 and 2 respectively in Schedule 1 to the Act. The new clause and Schedule, and the consequential Amendments, transfer to the new district councils the function
  3. In section 6(2)(a), before the word 'burgh' there shall be inserted the word 'former'
  4. In section 7(3), before the word 'burgh' there shall be inserted the word 'former'.
  5. For Schedule 1 there shall be substituted the following Schedule—
  of appointing representative commissioners under the 1969 Act. The existing commissioners will be removed, and new ones appointed by the new district councils will act on and after May 16, 1975, as commissioners for the purposes of the 1969 Act.
  BARONESS ELLIOT OF HARWOOD: The names on the Schedule are not correct. I do not know whether this is the moment when we ought to alter them, but yesterday we agreed two new names.
  LORD DRUMALBYN: I think it would be asking a bit much for us to have been expected to put down another

  1349
  Amendment overnight in order to get that right. Perhaps we may be allowed to put it right later.
  THE EARL OF SELKIRK: We could do it now by means of a manuscript Amendment.
  THE DEPUTY CHAIRMAN OF COMMITTEES (LORD CHAMPION): If there is to be a manuscript Amendment, it will have to be written and handed to the Chairman. That is something I must insist on.
  LORD HOY: I do not object to that happening, but I know this part of the country extremely well. Can the Minister assure us that all the local authorities have been consulted about this and have agreed to these changes being made?
  LORD DRUMALBYN: They have been consulted. This, of course, is a straight transfer which is necessitated by the change in the type of local authority that has been set up.
  BARONESS ELLIOT OF HARWOOD: I was not querying the change, but only the wrong names.
  LORD DRUMALBYN: We are concerned here with identifiable places. If we make an Amendment at the next stage of the Bill I hope that the noble Baroness will withdraw her query.
  Clauses 210 to 212 agreed to.
  LORD POLWARTH: Amendment No. 181 is a consequential Amendment. I beg to move.
  Amendment moved—
  After Clause 212, insert the following new clause:
  Tweed Fisheries Commissioners
  "212A.—(1) On 16th May 1975 each person holding office as a representative commissioner under the Tweed Fisheries Act 1969 shall go out of office.
  (2) The function of appointing representative commissioners under the said Act of 1969 shall be transferred to the district councils of Merse, Roxburgh, Ettrick Forest and Tweed-dale and the Berwick on Tweed District Council.
  (3) The said Act of 1969 shall have effect subject to the amendments set out in Schedule 25A of this Act."—(Lord Polwarth.)
  LORD HUGHES: I take it that the point the noble Baroness, Lady Elliott,
  1350
  has raised will be dealt with at the Report stage and that appropriate Amendments will be brought forward by the Government to insert the right names.
  LORD POLWARTH: Certainly.
  Clause 213 agreed to.
  Schedule 26 [Adaptation and Amendment of Enactments]:
  12.26 a.m.
  LORD POLWARTH LORD POLWARTH moved Amendment No. 182:
  Page 251, line 21, at end add—
  ("In section 11(2), after the word "the" there shall be inserted the words" area of the former".")
  The noble Lord said: This Amendment has the effect of maintaining the unusual position of the City of Glasgow in relation to the Celluloid and Cinematograph Film Act 1922, in that Glasgow under one of its local Acts has wider powers than in the general Statute. We are enabling them to retain these wider powers. I beg to move.
  THE DUKE OF ATHOLL THE DUKE OF ATHOLL moved Amendment No. 183:
  Page 256, line 31, leave out lines 31 to 33.
  The noble Duke said: The Border Rivers (Prevention of Pollution) Act 1951 makes provision for joint committees of river boards and river purification boards on both sides of the Border. Section 17 of that Act defines the responsible board. The Amendment seeks to substitute the words "purification authority" for "purification board", but Clause 134 refers only to "purification board". In those circumstances, I suggest that paragraph 99 should be deleted as being both wrong and unnecessary. I beg to move.
  LORD POLWARTH: I am grateful to the noble Duke, and am glad to accept this Amendment as a drafting improvement.
  LORD POLWARTH LORD POLWARTH moved Amendment No. 192:
  Page 268, line 9, at end insert—
  ("The Island of Rockall Act 1972
  189A. In section 1, for the words from "District" to "Inverness" there shall be substituted the words "Western Isles".")
  The noble Lord said: This Amendment redefines "local authority" for the purpose of Section 11 of the Independent Broadcasting Authority Act 1973. Section 11 makes provision for the appointment of local advisory committees in respect of all the local authorities whose sound broadcasting services are needed by the Authority.
  THE DUKE OF ATHOLL: My noble friend has left out one of his Amendments about the Island of Rockall.
  LORD POLWARTH: I beg your Lordships' pardon. I was trying to beat the Deputy Chairman of Committees in the race to it. Amendment No. 192 is a minor Amendment to substitute the name of the new local authority area as the fortunate one to possess the remarkable and outlying Island of Rockall. I beg to move.
  LORD POLWARTH LORD POLWARTH moved Amendment No. 193A:
  Page 268, line 24, at end insert—
  ("The Independent Broadcasting Authority Act 1973
  In section 11(6)(b), for the words from "council" to "small burgh" there shall he substituted the words "regional, islands or district council".")
  The noble Lord said: This Amendment redefines "local authority" for the purpose of Section 11 of the Independent Broadcasting Authority Act 1973. I have already spoken to it out of order, and I hope your Lordships will accept the Amendment. I beg to move.
  Schedule 26, as amended, agreed to.
  Clauses 214 to 216 agreed to.
  Clause 217 [Staff commission for Scotland]:
  LORD HUGHES: Amendments Nos. 193B and 193C hang together. They are important Amendments from the point of view of staff. It would be a nonsense to speak to them at this time of night, and I do not propose to move them. I will, however, resubmit them on Report.
  THE EARL OF SELKIRK: I should like to say that I think the Staff commission arrangement is very important. It is confined entirely to the operation
  1352
  of this Bill. I am going to ask the Government whether this might not be a permanent institution in Scotland, primarily designed to maintain the standards and facilities of transfer of local officers. I believe it might be of considerable importance and I would ask the Government to look at that point.
  LORD POLWARTH: I think that all the noble Earl would expect me to do at the moment is to say that I will certainly look at it.
  Clause 217 agreed to.
  Clauses 218 to 220 agreed to.
  Clause 221 [Transfer of Property]:
  12.31 a.m.
  LORD POLWARTH LORD POLWARTH moved Amendment No. 194:
  Page 134, line 38, after ("property") insert ("which is subject to the provisions of section (educational endowments) or (property held on trust) of this Act or property").
  The noble Lord said: This Amendment, together with the proposed new clause after Clause 221, seeks to ensure that the new authorities will be able to fulfil their duties in relation to trusts which are held by existing authorities or in which existing authorities have an interest. The new clause is the operative part: the Amendment is in fact consequential. This is purely a question of continuity. The clause is designed to enable these trusts to continue operating with the minimum changes necessary in their administration. I hope your Lordships will accept that as an explanation of the new clause.
  Clause 221, as amended, agreed to.
  LORD POLWARTH: I beg to move Amendment No. 195.
  Amendment moved—
  After Clause 221 insert the following new clause—
  Property held on trust
  —(1) All property held on trust immediately before 16th May 1975 by

  (a) an existing local authority, or

  (b) a councillor and a specified officer of an existing local authority,

  shall on that day be transferred to and vest (subject to the same trust) in the appropriate islands or district council.
  (2) The council in whom property is vested by virtue of subsection (1) above shall nominate a sufficient number of their councillors to

  1353
  act as trustees of that property and in so doing shall have regard to the terms of the trust deed; and where the property is held immediately before 16th May 1975 by the persons mentioned in subsection (1)(b) above, the council shall nominate the proper officer as one of the trustees.
  (3) All property held on trust immediately before 16th May 1975 by a specified officer of an existing local authority shall on that day be transferred to and vest (subject to the same trust) in the proper officer of the appropriate islands or district council.
  (4) Where, immediately before 16th May 1975, property is held on trust by the holder of an office, whether as a councillor or a specified officer, connected with an existing local authority or existing local authorities and any other person, the appropriate islands or district council or (where the area to which the trust relates comprises the areas of more than one existing local authority) the appropriate islands or district councils shall, on the application of the trustees, nominate a sufficient number of their councillors to act in place of such holder and in so doing shall have regard to the terms of the trust deed, and, where the terms of the trust deed so require, the said council or councils shall nominate the proper officer as one of the trustees.
  (5) In this section "appropriate islands or district council" means, in relation to an existing local authority, the islands or district council whose area comprises the whole or the greater part of the area of the existing local authority, and "appropriate islands or district councils" shall be construed accordingly.
  (6) This section shall not apply to property which is subject to section (educational endowments) of this Act."—(Lord Polwarth.)
  Clauses 222 to 225 agreed to.
  LORD POLWARTH LORD POLWARTH moved Amendment No. 196:
  After Clause 225 insert the following new clause—
  Abolition of fiars courts for counties, etc.
  "225A.—(1) The courts for striking the fiars prices for the counties of Scotland shall no longer be held, and accordingly no payment becoming due after the appointed day shall be calculated by reference to fiars prices.
  (2) Subject to the provisions of section 12 of the Conveyancing (Scotland) Act 1924 (abolition and commutation of grain, etc. feu-duties) the amount of any periodical payment becoming due after the appointed day which would, if it had become due immediately before that day, have fallen to be ascertained by reference to fiars prices, shall be a sum in money representing the average value of the payment due during the last three years before that day.
  (3) In the event of the parties failing to reach agreement as to the commutation into money of any payment by referent( to subsection (2) above, either party may apply to
  1354
  the sheriff for a decree declaring the commuted value in money of the payment.
  (4) Where any payment, the amount of which falls to be ascertained by reference to subsection (2) above, is exigible from any person by virtue of an interest in land, the title to which may be recorded in the Register of Sasines, any agreement relative thereto and any decree pronounced under subsection (3) above shall, on being duly recorded in the appropriate register, be binding upon all persons having interest.
  (5) Any valuation or question mentioned in subsection (4) of section 75 of the Agricultural Holdings (Scotlanqd) Act 1949, falling to be decided by reference to a date after the appointed day, which would, if it had fallen to be decided by reference to a date immediately before that day, have been decided by reference to fiars prices, shall be decided in such manner as the parties may by agreement determine or, failing such agreement shall, notwithstanding the provisions of that subsection, be decided by arbitration under that Act.
  (6) In this section "the appointed day" means the day appointed under section 235 of this Act for the coming into operation of this section."
  The noble Lord said: I am afraid that this is an Amendment of substance which I shall have to explain but I will do so as briefly as I can. The purpose of this clause is to abolish the institution known in Scotland as the fiars court in the counties of Scotland to make provision for those money payments which are still calculated on the basis of the commodity prices fixed by them. As Scottish Members of your Lordships' House will know, the fiars prices struck in any county of Scotland are the sheriffs' assessment of the average prices at which the different sorts of grain produced in the county at the last harvest were sold. They are used to calculate the current cash value of the various payments which were once made in kind but are now made in money. While they are still used for a variety of purposes, the number of occasions on which they are used is small and is becoming smaller every year. With the disappearance of counties as administrative units, following the reorganisation, and the probable alteration of sheriff court districts and sheriffdoms to coincide with the new local government areas, the abolition of the fiars court will eliminate the need for special provision for the continuation of a process which is out of date and falling into disuse.
  I might add that the Committee on Sheriff Courts, under the chairmanship of the late Lord Grant, recommended that fiars prices should cease to be struck.

  1355
  Unless your Lordships would like a longer explanation of this matter, I would propose to leave it at that, except to say that while, naturally, we regret the passing of any institution of an historical kind in Scotland, the fact is that the purpose for which the fiars court exists has virtually disappeared. This Amendment replaces it by a less laborious method.
  Clause 226 agreed to.
  Schedule 27 agreed to.
  Clauses 227 to 229 agreed to.
  Clause 230 [Orders, rules and regulations]:
  LORD POLWARTH: I beg to move Amendment No. 198, which is consequential.
  Amendment moved—
  Page 142, line 12, leave out ("(a)").—(Lord Polwarth.)
  Clause 230, as amended, agreed to.
  Clauses 231 and 232 agreed to.
  Clause 233 [Savings]:
  LORD POLWARTH: I beg to move Amendment No. 201 which is a consequential Amendment.
  Amendment moved—
  Page 144, line 33, leave out ("1962 and 1969") and insert ("1939 to 1973").—(Lord Polwarth.)
  Clause 233, as amended, agreed to
  Clause 234 agreed to.
  Schedule 28 [Repeals]:
  12.37 a.m.
  LORD POLWARTH: I beg to move Amendment No. 202 which is a consequential Amendment.
  Amendment moved—
  Page 284, line 5, column 3, at end insert ("In section 5(3), the words from "and the fee" onwards.")—(Lord Polwarth.)
  LORD DRUMALBYN: Amendment No. 203 is a drafting Amendment. I beg to move.
  Amendment moved—
  Page 286, line 2, column 3, after ("110") insert (C in subsection (1), the definition of "Large burgh", and")—(Lord Drumalbyn.)
  LORD POLWARTH: I beg to move Amendment No. 204, which is a consequential Amendment.
  Amendment moved—
  Page 287, line 25, column 3, at end insert ("(4),")—(Lord Polwarth.)
  LORD DRUMALBYN: I beg to move Amendment No. 210. This also is a consequential Amendment.
  Amendment moved:—
  Page 291, line 23, at end insert—

  ("14 & 15 Geo. 6. c. 15.

  The Local Government (Scotland) Act 1951.

  The whole Act.")

  —(Lord Drumalbyn.)
  12.40 a.m.
  THE DUKE OF ATHOLL THE DUKE OF ATHOLL moved Amendment No. 213:
  Page 291, line 31, column 3, leave out ("section 11").
  The noble Duke said: I should like to ask a brief question on this Amendment. In this Schedule Section 11 of the Rivers (Prevention of Pollution) (Scotland) Act 1951 is repealed. My Amendment would seek to have Section 11 kept. Section 11 deals with the making of bylaws. I feel sure that it must be possible to make by-laws under Clause 134, which was inserted in this Bill on the Committee stage in another place, but I should like my noble friend to assure me that it is. It would probably be an advantage to these boards to be able to make by-laws in certain cases. I beg to move.
  LORD DRUMALBYN: I am informed that Section 11 is no longer necessary because the provisions of Clause 202, "Procedure for by-laws", take its place.
  THE DUKE OF ATHOLL: I beg leave to withdraw the Amendment
  Amendment, by leave, withdrawn.
  LORD DRUMALBYN: This Amendment was discussed with Amendment No. 134. I beg to move:
  Amendment moved—
  Page 291, line 35, column 3, at end insert

  1357
  ("In section 29(4), the words from "subject" onwards.")—(Lord Drumalbyn.)
  THE DUKE OF ATHOLL: This Amendment is on the same point as a previous Amendment which the Government accepted, that under Clause 134 the river purification authorities have now gone back to being called "river purification boards". I beg to move.
  Amendment moved—
  Page 291, line 37, column 3, leave out (""river purification boards or"") and insert (""or river purification authorities"")—(The Duke of Atholl)
  LORD DRUMALBYN: The effect of this Amendment would be to limit the holding of inquiries under Section 31 of the Rivers (Prevention of Pollution) (Scotland) Act 1951 to the functions of river purification boards only, to the exclusion of islands councils as river purification authorities. It is desirable that any inquiry which might be held under Section 31 of the Rivers (Prevention of Pollution) (Scotland) Act 1951 should relate not only to the functions of river purification boards but also to those of islands councils which, along with river purification boards, fall within the meaning of "river purification authorities" in Section 17(2) of the 1951 Act as amended by Schedule 16.
  THE DUKE OF ATHOLL: In that case, as we have gone back to calling them "river purification boards", ought not the words: "In Section 30(1), the words 'river purification boards or'" to be deleted from these repeals? I fully appreciate my noble friend's point about the islands councils, and realise that we still have to retain the word "authorities" but I should have thought we now need to delete the whole of the sentence I have referred to.
  LORD DRUMALBYN: I shall be very glad to have a look at that point. I am afraid I cannot give my noble friend the answer right away.
  THE DUKE OF ATHOLL: I beg leave to withdraw the Amendment.
  Amendment, by leave, withdrawn.
  LORD DRUMALBYN LORD DRUMALBYN moved Amendment No. 220:
  Page 295, line 6, column 3, at beginning insert ("Section 27").
  The noble Lord said: This Amendment effects a minor repeal in the light of the relaxation of central Government control over local authorities. It removes the transitional position of the Caravan Sites and Control of Development Act 1960 which gave the Secretary of State power to repeal or amend local enactments which were inconsistent with that Act. The provision is now spent.
  12.45 a.m.
  LORD DRUMALBYN: Amendment No. 222 is consequential on the repeal of Section 28 of the Public Health (Scotland) Act 1897, in paragraph 31 of Schedule 26. I beg to move.
  Amendment moved—
  Page 301, line 24, column 3, at end insert—
  ("In Schedule 1, paragraph 1.").—(Lord Drumalbyn.)
  THE DEPUTY CHAIRMAN OF COMMITTTES (LORD CHAMPION): I notice that Amendments Nos. 223 to 231 stand in the name of the noble Lord, Lord Polwarth, and I wonder whether he would care to move them en bloc.
  LORD DRUMALBYN: These Amendments are all consequential or have been previously discussed. I beg to move Amendments Nos. 223 to 231 en bloc.
  Amendments moved—
  Page 301, line 46, column 3, at end insert—
  ("In section 10(1)(xvi), the words "and the consent of the Minister".
  Section 11(4).")
  Page 301, line 53, column 3, at end insert—
  ("In section 16, in subsection (2), the words from "and (d)" onwards, and subsections (3), (4) and (5).
  In section 18, in subsection (1), the words "to the Minister and", and in subsection (2), the words "to the Minister and".
  Section 21 (5)(a).")
  Page 302, line 13, column 3, after ("12") insert ("14")
  Page 303, line 41, at end insert—

  ("1969 c. xxiv.

  The Tweed Fisheries Act 1969.

  Section 3. In section 5(2) the words from "but" onwards.")

  Page 304, line 46, column 3, at end insert—
  ("In section 43, in subsection (1), the words from "and (b)" onwards, and in subsection (3), the words from "and the notice" onwards.")
  Page 304, line 52, column 3, at end insert—
  ("In section 107(3), he words" application for".")
  Page 305, line 20, column 3, at end insert—
  ("In section 153(1), the words from" (other "to" State)".")
  Page 305, line 27, column 3, after ("(5)")
  insert ("paragraph (b) and")
  Page 305, line 46, at end insert—

  (" 1973 c.28.

  The Rate Rebate Act 1973.

  The whole Act.")

  —(Lord Drumalbyn.)
  Schedule 28, as amended, agreed to.
  Clause 235 [Short title, commencement and extent]:
  LORD DRUMALBYN: I beg to move Amendment No. 232, which has been discussed with Amendment No. 180.
  Amendment moved—
  Page 145, line 21, leave out ("section 145(5)") and insert ("sections 92, 145(5) and 212A and Schedule 25A")—(Lord Drumalbyn.)
  LORD HUGHES: I do not think we can congratulate ourselves on the way in which we have proceeded in the latter part of this Bill. We have got through it in the two days but in a most unsatisfactory fashion, and it is obvious that we did not allow sufficient time for the enormous number of Amendments that were tabled. We have got to this stage only at the expense of having a whole lot of the Amendments to be re-submitted at Report stage and I am afraid that while most of us had hoped that the Report stage would be fairly brief, it is not now going to be.
  I am not opposing this Amendment. My real purpose in rising was to say that having got to the end of this stage we owe a very special debt of gratitude to the Deputy Chairman of Committees, the noble Lord, Lord Champion. If we had all spoken as quickly and with as few—or no—mistakes as he has done, we might have made the deadline of twelve o'clock at which we were aiming and I think it would be wrong if we were to reach the end of this remarkable occasion without expressing our thanks to him.
  SEVERAL NOBLE LORDS: Hear, hear!
  THE DEPUTY CHAIRMAN OF COMMITTEES (LORD CHAMPION): The noble Lord is much too kind.
  Clause 235, as amended, agreed to.
  House resumed: Bill reported, with the Amendments.

NORTHERN IRELAND CONSTITUTION BILL
Returned from the Commons with the Amendments agreed to.
WATER BILL
Returned from the Commons with the Amendments agreed to.
INSURANCE COMPANIES BILL [H.L.]
Returned from the Commons agreed to, with Amendments; the said Amendments to be printed.
GREATER LONDON COUNCIL (MONEY) BILL TRENT RIVER AUTHORITY BILL
Reported, with Amendments.
  TREASURY BILLS
  TREASURY BILLS
  DOCTORS' AND DENTISTS' REMUNERATION
  DOCTORS' AND DENTISTS' REMUNERATION