Sitting of 20 December 1974

Preamble
The House met at Eleven o'clock
PRAYERS
[Mr. SPEAKER in the Chair]

STATEMENTS (RAIL SERVICES AND TEACHERS' PAY)
Sir Bernard Braine: On a point of order, Mr. Speaker. May I inquire whether the Secretary of State for Employment has sought leave to make a ministerial statement about the appalling disruption on the commuter lines? If not, may I express my profound disgust?
Mr. Speaker: That is not a matter for the Chair.
Dr. J. Dickson Mabon: On a point of order, Mr. Speaker. I understand that my hon. Friend the Member for Central Ayrshire (Mr. Lambie) has tabled a Written Question to the Secretary of State for Scotland about the publication of the Houghton Report.
Various comments have been made in the Press this week suggesting that a statement might be made, if not by the Secretary of State for Scotland, then by the Secretary of State for Education and Science. As the children return from the school holidays on 6th January, which is before the House reassembles, and as it is important that there should be no further disruption as a result of strikes by the teachers, would it not be wise for a Minister to make a statement today? If you, Mr. Speaker, have not had notice that a statement will be made this morning—and it was suggested on the radio and in the Press that such a statement would be made—shall we, for the convenience of hon. Members, have a statement before the House rises at half-past four?
Mr. Speaker: I am very sorry. I cannot satisfy the hon. Gentleman's curiosity. These are not matters for me.
The Parliamentary Secretary to the Treasury (Mr. Robert Mellish): May I assure my hon. Friend the Member for Greenock and Port Glasgow (Dr. Mabon)
2012
that a statement is being made by the Minister by means of Written Answer today. As you will know, Mr. Speaker, it has been the custom and practice of the House to avoid the making of statements on Fridays. It always causes inconvenience and detracts from the time available to private Members. That is why a statement is to be made in the usual way by Answer to a Written Question.
Mr. Patrick Jenkin: Can the right hon. Gentleman give any comfort to my hon. Friend the Member for Essex, South-East (Sir B. Braine), who has raised a matter of grave importance? A Minister from the Department of the Environment is present. Cannot a statement be made on the appalling inconvenience being caused to tens of thousands of people as a result of the dispute on the railways?
Mr. Mellish: The point will be conveyed immediately to my right hon. Friend the Secretary of State for Employment. But this is not a sudden, new problem. It has arisen before. All of us in the House deprecate the hardship and hurt being imposed on many innocent people. Right hon. and hon. Members are not the only people who share the feeling of displeasure.
Mr. Kenneth Lewis: The Patronage Secretary has said that it is not usual for Ministers to make statements on Fridays. But it must depend on the urgency of the matter. By giving a Written Answer the Minister is escaping his responsibility. A statement could have been made yesterday. There are plenty of Members present. If the right hon. Gentleman likes, he can ask the Minister to come to the House and make a statement on these matters.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: I must protect private Members' time and end this discussion.

BILL PRESENTED
CHANNEL TUNNEL
Mr. Secretary Crosland, supported by Mr. Secretary Callaghan, Mr. Secretary Jenkins, Mr. Secretary Varley, Mr. Joel Barnett, Mr. Fred Mulley, and Mr. Neil Carmichael, presented a Bill to provide

2013
for the construction and operation of a railway tunnel system under the English Channel, together with associated works; to make provision for guaranteeing loans and for the expenditure necessary for and in connection with the construction and operation of that system and those works; to constitute a Board to participate in the operation of that system; to incorporate part of that system into the United Kingdom and to provide for the jurisdiction of courts in Great Britain over matters occurring in that system and trains proceeding through it; to provide controls in connection with passengers and goods passing through that system; to provide for the incidence and computation of tax in connection with the construction and operation of that system; and for connected purposes; and the same was read the First time; and ordered to be considered, pursuant to the order of the House of 11 th November, upon Monday 13th January and to be printed. [Bill 58.]
ADJOURNMENT
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Walter Johnson.]

NUCLEAR ENERGY
11.8 a.m.
Mr. Arthur Palmer: I wish to raise a number of issues which arise primarily from the very important decision by my right hon. Friend the Secretary of State for Energy in July to adopt in Britain the heavy water reactor as the basis for expanding the country's installed nuclear electricity generating capacity.
Following that decision—it was the culmination of about four or five years' debate, much of it, but not all of it, in public—the House rounded everything off by having a full day's debate on the subject. I do not wish to go over ground which was covered on that occasion. I believe that my right hon. Friend took the right decision and that the sense of the House in the July debate confirmed that view.
However, it was a vastly important decision for another reason, apart, to some degree, from the choice of reactor type. On its interpretation turns the ground design of British energy strategy for the future. My right hon. Friend made an announcement in July about future nuclear generating capacity, and a few weeks ago he also made a statement on the Government's policy in relation to the conservation of energy. These are not separate matters but two aspects of the same issue.
The question is how much energy efficiently produced at a competitive price will be available to sustain our national life for the time ahead and to power our general industry for the future. Conservation will make its contribution by acknowledging that there has been in the past, and perhaps still is, an avoidable waste of resources, but once that slack is taken up it cannot be done again. So the basic energy requirements in terms of electricity remain and, whatever may be done in the future with solar energy, wind power and so on on a small scale, there are only three available bulk sources—coal, oil and natural gas taken together, and nuclear fission—at the present stage of British energy development. Tidal power in the Severn might give an extra push, but that is very much in the future. I think it is accepted by those who follow energy matters that coal, oil

2015
and nuclear fission are not exclusive of each other but are now complementary within a normal price band. If one source does not measure up to the need, an undue strain will be placed on the others.
My first question to my hon. Friend the Under-Secretary of State for Energy is this. Is the nuclear contribution which is now proposed large enough in relation to the strains that may be placed on the national fuel economy in the future? I do not think it is. There are worrying features about the progress being made in what has already been decided. I remember well the time when there was heady talk of no more fossil fuel plants after 1980 or 1985, but what is now proposed is a retreat from the past, not an advance, in terms of nuclear capacity. The figures are interesting. The Magnox programme of the early 1950s proposed nine stations. The stations have been completed and the Magnox programme represents 4,800 MW. The AGR programme, unhappily not completed, is for five stations of 5,000 MW. Our new programme is for three stations of 4,000 MW. The figures speak for themselves.
With new nuclear expansion being on such a modest scale, are we sure that our indigenous oil and coal resources can make up the difference over the next decade, even at the minimum likely rate of electricity growth? When I speak of indigenous oil resources I mean, of course, those which are anticipated rather than those which are available. I do not think that the coal industry would claim that it could make up the difference. The coal industry is already stretched and is likely to be stretched for the future, and I think it is common ground that it could not make up the deficiency. North Sea oil is already much mortgaged for the future. I should not like to list all the promises that have been made on the strength of North Sea oil, and it has physical problems of supply from the point of view of electricity generation.
I do not want to strike just before Christmas an unduly pessimistic note, but if we are not careful we shall find ourselves 10 years from now embarrassingly dependent still on substantial imports of oil and, for all I know, imports of coal. That seems to point to the urgent need for maximum possible expansion of
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nuclear capacity now that the choice of the next reactor has been decided, I hope once and for all. That has been done after four years of hesitation, mainly under the administration of the Conservative Party, although I am not taking a party view on that.
It is curious that until recently the Central Electricity Generating Board, the principal utility concerned, wished for a nuclear programme of between 20,000 MW and 26,000 MW. Taking countries which are comparable in the size of their economies, that would have compared at present reasonably with West Germany, France and Japan. The CEGB's proposals a year or so back for 26,000 MW would have been the expected expansion for advanced industrial countries in the second league although it is agreed that the CEGB, unlike the South of Scotland Electricity Board, made no secret of its desire to base its expansion on American-style light water reactors.
My second question to my hon. Friend is this. Is the modest programme now proposed, which is inadequate to the needs of the country, bound up with the choice of reactor, or are there still serious difficulties in the organisation and control of the manufacturing side of the industry? I reject myself the suggestion that it is necessarily the choice of reactor that is giving us this small programme. It is true, however, that there is a contrast between the outstanding enthusiasm and self-confidence of the small South of Scotland Board in relation to heavy water reactors and the perhaps more normal caution of the construction division of the CEGB in respect of the preliminary development of this reactor.
May I say in defence of the CEGB—I am anxious to defend its staff in this respect—that I am told that, although my right hon. Friend made his statement in July, it was nearly two months before the Department moved to bring the parties together. I have been told that on good authority and I should be interested to know whether it is so. I am informed that there has not been in the Department the sense of urgency that the situation demands. I am referring not to my right hon. Friend or my hon. Friend but to the officials in the Department. Everything moves so slowly, I am told.
Mr. Ronald Brown: May I remind by hon.

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Friend that when the CEGB Chairman was before the Select Committee he was anxious to tell us how he would be off the mark almost immediately on light water reactors? I asked whether he would be so speedily off the mark if heavy water reactors were chosen. Is not my hon. Friend being too defensive of the CEGB Chairman?
Mr. Palmer: I am in some difficulty. I am not here to censure, or applaud the Chairman of the CEGB, but I can speak on behalf of the technical staff. They are enthusiastic enough and anxious to get on with the job. I have here a quotation from an answer given to the Select Committee by Mr. Hawkins which I will come to in just a moment. I can tell my hon. Friend that certainly the Electric Power Engineers' Association which organises the technical staff is very interested in having an expanded nuclear programme.
I come to the evidence given by the CEGB Chairman which is given on page 49 of the report of the Select Committee on Science and Technology, "The Choice of a Reactor System". A question was put to Mr. Hawkins about the expansion figure he proposed in relation to the choice of reactor. This is his answer:
"Regardless of what the choice of reactor is"
—I emphasise that—
"we are saying at the moment that we would like to order in 1974 two stations, and that we would like to order in 1975 one station, another in 1976, another in 1977, two in 1978 and two in 1979—nine new stations—and nine more from 1980 to 1983, which is looking a long way ahead ".
There is more. The Chairman was anxious to make clear to the Select Committee, in response to my question as Chairman, that the choice of reactor did not determine the size of the expansion programme.
Mr. Patrick Jenkin: It might be helpful to have on record the date when Mr. Hawkins gave that answer, because there have been major changes in the ambient circumstances.
Mr. Palmer: Mr. Hawkins made that statement to the Select Committee on 18th December 1973. I am coming to the defence of Mr. Hawkins. He made it clear to the Select Committee that he did not wish the choice of reactor to determine the size of the programme.
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Some people at the time thought that his programme was a little ambitious, to say the least, but it makes a staggering contrast with the three stations and the 4,000 MW now proposed.
I am driven back to the conclusion that whatever the CEGB and the South of Scotland Electricity Board wished to buy in reactor numbers and capacity, the construction industry was in no position to supply it. I think that the Chairman of the CEGB might have known that, of course, but there it is. The difficulty was apparently that the customer wanted them but the supplier was unable to deliver them.
The fault is not entirely with the nuclear manufacturing groupings. For too long no extra nuclear work was given to them, and they have had to wrestle at the same time with the manifold problems of the advanced gas-cooled reactors. In those circumstances—not providing a continuous flow of work in heavy electrical manufacturing—design teams break up and skilled staff leave for other places.
Time is fast running out. I think that my right hon. Friend the Secretary of State for Energy now has a clear opportunity to complete that rationalisation of the manufacturing side of the industry that the Select Committee advocated seven years ago. My right hon. Friend showed great courage in his choice of reactor. I think that he can and will show equal courage for the future decision on rationalisation that he will have to make soon.
This has been an unhappy story. Four Ministers ago—that is how I calculate parliamentary time—the House was told that the National Nuclear Corporation had arrived. That was in the almost forgotten time of the right hon. Member for Knutsford (Mr. Davies) who had brightly come into the House from the Confederation of British Industry. Indeed, that was not only four Ministers ago, but, in terms of normal time, two to three years ago. I regret to say that the National Nuclear Corporation still exists only on paper. This is very bad in view of the assurances that were given to Parliament.
I think my hon. Friend the Undersecretary will confirm that the preliminary inquiries for the heavy water reactor programme have gone not to the National Nuclear Corporation but to the TNPG.

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which still exists. The National Nuclear Corporation certainly has directors, and it presumably has a telephone, but I understand that that is about all. The fact is that both separate nuclear groupings, the Nuclear Power Group and the British Nuclear Design Corporation, still flourish—the old within the skin of the new, as it were.
Where exactly do the General Electric Company and Sir Arnold Weinstock now stand? Is Sir Arnold still to have a special management contract, and, if so, with whom? Is that contract to be with the Government or with the National Nuclear Corporation? Is it to be simply an arrangement between the TNPG and his own grouping? What progress has been made in the signing of that contract and what terms are being asked for? Does GEC wish to reduce its stake in the National Nuclear Corporation? Sir Arnold has made it clear that he does not particularly like the steam generating heavy water reactor and would have preferred the light water reactor which he thought had special export possibilities for components. I am thirsting for information. These are important questions which require answers.
My hon. Friend the Under-Secretary, who I understand is to reply, promised that the Secretary of State for Energy would make a statement on this matter in the House fairly soon. That was about three weeks ago. We have not had the statement. When may we expect it?
The Select Committee on Science and Technology looked for the second time into the question of the Unified Design and Construction Organisation—the NNC—on an all-party basis some time ago. It looked at it on an all-party basis—I believe that there was a Conservative majority on the Select Committee at that time—and recommended that the State holding in this organisation, through the Atomic Energy Authority, should be increased from 15 per cent. to 30 per cent. With the State holding the balance fairly, there would not be the risk of one private concern dominating the whole thing.
I now speak only for myself in this matter, but I imagine that many of my right hon. and hon. Friends will agree with me. I should like to see a majority State holding, not on any idealogical
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grounds but because it is essential in the national interest and could command general assent. Whatever happens in future regarding nuclear construction, whatever profits, losses or money gains are made, we can be certain that, as it is energy, the State in the long run will have to underwrite nuclear construction. Therefore I suggest that, in view of the hesitations, the delay, the confusion and the little battles for individual power that apparently still go on, the Government should grasp the nettle and move towards a majority State holding.
What surprises me is that although we can give public financial assistance for the manufacture of motor cycles—that may be justified; I do not know a great deal about that subject—we seem to hesitate to put up public money to acquire a majority holding in an energy industry which is fundamental to the existence of our nation and the standard of life of the people.
I have put these nuclear energy matters before the House because I feel that they require urgent attention. Also, I believe that the questions I have asked deserve a full answer.
11.30 a.m.
Mr. Airey Neave: The hon. Member for Bristol, North-East (Mr. Palmer) is always extremely well-informed when dealing with the nuclear power programme. My colleagues and I on the Select Committee on Science and Technology are glad once again to serve under the hon. Gentleman's chairmanship.
I shall not intervene for more than a few minutes, so as to enable my right hon. Friend the Member for Wanstead and Woodford (Mr. Jenkin) and the Under-Secretary of State for Energy to have a full opportunity to contribute to this important debate.
I strongly welcomed the decision by the Secretary of State for Energy on 10th July for a number of reasons. The most important is that I believe the SGHWR will be a much easier reactor to make and erect than the American light water reactor. British industry has practically no technological experience of the designs related to the American LWR. It would have been virtually impossible to start from scratch a programme of the grand size proposed to the Select Committee.

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The hon. Gentleman asked some pertinent questions, including the important consideration whether the 4,000-MW system will be large enough. I wish to declare an interest in a boiler-making company which is part of the Nuclear Power Group. I was Chairman of the Select Committee when it recommended the 30 per cent. shareholding to which the hon. Gentleman referred. I do not depart from that decision whatever the Secretary of State ultimately announces.
I should like to deal with the need for development work on the SGHWR. I hope the Under-Secretary will say that the Department will insist on regular progress reports on design from the boards and the industry. It is imperative that there should be no unnecessary delay in design work.
I appreciate the atmosphere to which the hon. Gentleman referred in the industry and the difficulties which it is experiencing, and I do not wish to exacerbate them, but the SGHWR decision reached by the Secretary of State cannot be described as a purely political decision. It was not a political decision. It was a technical and commercial decision of the highest importance—a decision which I supported and for which I gave my reasons on many occasions. The SGHWR is an easier reactor for British industry to deal with, and industrial capacity in this country to make the light water reactor was lacking. Therefore, it cannot be described as pure politics.
The Times, in a leading article on 1lth July, described the decision as
"one of the worst political decisions in the industrial field for many a decade".
That comment requires some qualification, because I can think of some other decisions in the industrial field in the last 10 years very much worse than that decision. The Times' knowledge of this problem did not extend to suggesting an alternative reactor design, but it ended with the unexceptionable statement that
"it remains to be seen whether they"—
referring to the SGHWRs—
"work reliably and how much, in the end, they cost"
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What a profound remark! It would apply to any reactor. The important thing is to get on with the design work.
From my personal knowledge of this problem and of people in the industry, I appreciate that much detailed engineering and pre-production work is still necessary for a commercial programme. I make that comment despite the success of the Winfrith prototype. It applies to a number of key components in the primary circuit of the reactor. It is important to get these right so that we do not have to mount a rescue operation afterwards, as we did in the case of the AGR. It is much better to have one stream of development involving the resources of both the CEGB and the SSEB. I hope that there will be full-co-operation. There is also the Canadian Candu experience. Are talks going on with the Canadian Government at present? I hope that talks will take place at ministerial level. Once the first 4,000-MW programme has been successfully completed, I hope that a great many more companies in this country will become involved.
I agree with the hon. Gentleman that it is necessary to get the SGHWR reactor right before the programme is increased. I am inclined to support the idea of a 4,000-MW programme, but if there are any delays in the design work within a relatively short space of time the Secretary of State should give encouragement to the programme. I want to see the pressure tube industry made part of the SGHWR programme so that its products may be exported to developing countries.
For these reasons I applaud the Secretary of State on his courage in making his decision, and I was glad to see that my right hon. Friend the Leader of the Opposition embodied this matter in our election programme. The decision is a triumph for the Secretary of State and it will give a great boost to Britain's heavy engineering industry.
11.38 a.m.
Mr. Ronald Brown: I wish to intervene briefly in the debate to ask the Minister when he replies to deal with one or two points.
Is my hon. Friend the Under-Secretary satisfied that the CEGB is enthusiastic

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about the new programme? The impression I gained from the evidence given by Mr. Hawkins, Chairman of CEGB, was that there was much to be desired in the board's attitude. I hope that the Minister is receiving reports from the CEGB on progress and that he is being fully informed about planning matters.
When CEGB officials appeared before the Select Committee they indicated that, given a decision on reactor choice, they could be off the mark immediately. Their argument was that they were waiting for a decision from the Secretary of State— and in the early days it was not the present Secretary of State to whom they was referring but a previous Minister. They have now had that decision, and I hope that we may be told what progress in planning terms has been achieved in implementing it.
May we be told whether Mr. Williams of the Nuclear Inspectorate has yet been involved? This point was at issue when the Select Committee discussed reactor choice. Will the CEGB call on Mr. Williams for his advice on the programme, and how far has any planning gone? May we be told whether any ordering has taken place? One of the criticisms which has been expressed for a number of years relates to the delay factor between decision making and the final result, particularly related to slippage between one stage and another. Since a decision has been so long delayed, now that the industry has been given one I thought that it would only have to open a drawer to set all the machinery in motion.
What is the time scale now and its determination? Is it the one outlined by my hon. Friend the Member for Bristol, North-East (Mr. Palmer) or has it been changed? If it has been changed, perhaps we can be told why the change has been made and to what it has been changed. It is necessary that all these questions are answered so that the House can understand what is happening.
I thought at the time my right hon. Friend made his decision known to the House that it was a courageous one and, above all else, correct in almost every department. I was particularly concerned about the safety aspect, and what has happened in America only confirms
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the view I held at that time. The Americans are still closing down stations because of the danger of the LWR. Therefore, our decision was right.
It is important to refer to the export potential. Developing countries will be much more impressed by this kind of reactor, certainly from its safety point of view, than by any others on the market. I hope that this morning my hon. Friend will be able to give us some positive statements so that we can see the progress that has been made.
11.41 a.m.
Mr. Patrick Jenkin: The House is indebted to the hon. Member for Bristol, North-East (Mr. Palmer) for having initiated this debate. Whereas normally one would not speak at any length from the Front Bench in Private Members' time, this is a matter of such wide general interest that perhaps a few remarks from me would not be out of place.
I had the advantage last night of sitting next to the master of my old college at Cambridge, none other than Sir Alan Cottrell. I was able to discuss with him some of the issues that arise in this whole problem and something of the future. I should like to make it clear in fairness to Sir Alan that nothing I say today in any sense represents his view. On the contrary, I have my own ideas on these things.
It is strange to reflect that this is the first debate the House has had on this subject since the report of the Nuclear Power Advisory Board was published. Due to printing difficulties it did not follow as swiftly after the Secretary of State's statement as we had hoped, and we did not get the report until the middle of the long recess, shortly before the election. We cannot do justice to it today as the debate has to end at 12.15 and I want to leave the Under-Secretary of State sufficient time to deal with the many pertinent questions that have been asked.
The only point I should like to make on the NPAB report arises on paragraph 8.16, which states:
"It will be seen from the foregoing that a nuclear programme based on SGHWR would be likely to require the construction of more fossil-fuelled plant than one based on PWR, due to the longer time before the SGHWR would be ready for full series ordering. On this basis, the amount of additional fossil fuel

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required could be very large, with an annual cost of up to £500 million in 1985–86 and increasing for some years thereafter possibly to £1,000 million a year in 1990–91.… Additional costs on this scale would have serious implications for our generating costs and for the balance of payments".
The Secretary of State will remember that that was the only point of substance I put to him in my questions after his statement. I wonder—is the Undersecretary of State prepared to give any estimate of what the additional cost would be because of the small size of the ordering programme which the Secretary of State announced in July, just 4,000 MW?
I now come to the question of the programme. Can the hon. Gentleman confirm that what is now envisaged is two stations: one with two twin reactors to be located at Sizewell, which means four reactors of 660 MW, and one station with twin reactors of 660 MW at Torness in Scotland for the SSEB? I think that that is what is in mind, but perhaps the hon. Gentleman can confirm it.
The next matter is that of heavy water. A programme of this size will require substantial quantities of heavy water, and we have heard nothing about this since the July statement. The costs of building a heavy water plant are enormous. The hon. Member for Bristol, North-East and I were in Canada in May and we were told that the current estimate for building an 800-tons-a-year heavy water plant was $350 million. It is assumed that for the first reactor we shall be able to import heavy water from Canada, but I wonder what the current thinking is on this. Will we have a heavy water plant in this country, and, if so, where will it be located?
My hon. Friend the Member for Abingdon (Mr. Neave) asked about Canadian co-operation. One of the pluses that always seemed to us to be in favour of the heavy water reactor was the opportunity of acquiring Canadian know-how, particularly in components. One thinks of key components such as the primary circuit pumps and some of the valves which are of substantial design and where collaboration can be of great value.
Where have we got to with the Canadians? When we were in Canada
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we were told that the difficulty was that the Canadians had no one in the United Kingdom to whom they could talk. Until the NNC came into operation there was no industrial organisation here, and they were unable to make any progress. Has any progress been made in the seven or eight months since the hon. Gentleman and I were with a parliamentary group in Ottawa and Toronto? I hope to have the opportunity of a brief meeting with Doctor Lome Gray in January in Ottawa and it would be helpful to know a little of the current background.
I come next to the pertinent questions that were asked about the National Nuclear Corporation. It is a matter of some disappointment that we have not seen faster progress towards establishing this body, which was proposed by the previous Conservative Government, to get it off the ground. My information is similar to that of the hon. Member for Bristol, North-East—that is to say, the discussions on design are being pursued intensively but not through the NNC but the TNPG. Mr. Ghalib is managing director-designate of NPC but it is not clear which hat he is wearing when he is in charge of these matters.
I am told that Lord Goodman has been involved in trying to bring together the two existing consortia and the establishment of the NNC. When can we expect a statement which the Secretary of State promised?
May I now turn to a more detailed question? On 6th November The Guardian published an article about the possibility of Orford Ness in East Anglia being earmarked as a possible site for the first commercial fast breeder reactor. Anthony Tucker, the science correspondent of The Guardian, said:
"The Central Electricity Generating Board yesterday denied tha it was 'secretly' buying the southern part of Orford Ness from the Ministry of Defence for use as a site for massive nuclear power development."
The House will remember that that was the site of a long-range anti-missile system—"Cobra"—that was shut down abruptly a year ago when it was no longer thought to be playing a useful part in our defences. Many people hoped that that area, which is a valuable nature reserve, might again become available to the public. What is happening about that?

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That same article also said:
"On the suggestion that Orford Ness was destined to become a major complex for fast-breeder reactors, a reactor type which is emerging as a prototype and which presents special hazards and siting problems, the CEGB spokesman said that such a plan could not exist since reactor types were decided by the Minister and no application was being considered for a full-size fast-breeder system."
Those last few words are rather sad, if true, because one thing which stands out in this immensely complex field is that the long-term future of the nuclear programme will depend more and more upon the fast breeder, because of its enormously higher utilisation of scarce fissile fuel— some 40 to 50 times the efficiency of thermal reactors.
It is good news that Dounreay is now feeding power to the grid in Scotland, I think—although it was choked with seaweed a month ago. That is one of the hazards in these matters. Phénix was feeding electricity to the French grid a year ago. The French and Germans and Italians are now well advanced with their plans for Super-Phénix, the commercial fast reactor which the three electricity utilities ars proposing to build.
I had thought that there was, if not an actual decision in principle, a general intention that the first order for a commercial fast reactor—"commercial" is perhaps the wrong word, since it would be a demonstration model, not a commercial plant, although it would be of a commercial size, 1,000 or 1,200 MW—was being actively pressed forward. If not, are we not once again falling behind in an area of advanced technology where once we were years ahead of our rivals? We are still five years ahead of the Americans and the Germans, but the French have a nose ahead at the moment. In a technology with enormous implications for the whole world's power systems, we need to devote a great deal of attention and pressure to make sure that the British lead is not lost.
Where do we now stand on the suggestion of international co-operation on breeder reactors? I have had lengthy discussion with the French and the Germans, and I know that the Secretary of State has too, but I should like to know something of that. I accept that the costs of developing this reactor system are so large that they may have to be shared
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perhaps in some kind of European consortium.
Our fossil fuel resources, though substantial—some hundreds of years' worth of coal and many decades of oil—are finite. Once we have used them, we cannot use them again. Therefore, in common with every other advanced nation we must now see that our energy supplies over the next half century and beyond are increasingly dependent on nuclear power. We cannot run down finite resources which in the longer term will be needed as a source not of energy but of materials for fibres and plastics. But they will not be there if we burn them hastily and wastefully over the next couple of decades.
I hope that the Minister will be able to give us an encouraging report that the SGHWR programme will soon be off the ground and that firm orders will soon be placed. I hope he can assure us about the enthusiasm of all parties—whether the NNC or the CEGB or other parts of the industry—for this programme and that we can look forward to some rapid expansion of the programme as early as possible.
I would end as the hon. Member for Bristol, North-East began. It is the small size of this programme which gives rise to concern. I would say, on no party basis, that this is a pilot programme and that the sooner we move ahead from that the better.
11.55 a.m.
The Under-Secretary of State for Energy (Mr. Alex Eadie): I congratulate my hon. Friend the Member for Bristol, North-East (Mr. Palmer) on having initiated this important debate. He posed three particularly significant questions. In my attempt to answer the debate I hope that I may be able to cover some of the points made by the hon. Member for Abingdon (Mr. Neave), who has always shown a great interest in these debates and whom I am pleased to see here, and by my hon. Friend the Member for Hackney, South and Shoreditch (Mr. Brown).
The Government's nuclear power policy since we took office is one element—a vital element—of their overall energy policy. Our objective has been to supply the nation's energy needs at the minimum cost in resources consistent with security of

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supply, public safety and the protection of the environment. Our approach is to make the best use of indigenous resources and to bring them forward as quickly as is technically and economically feasible, especially in the next few years.
Nuclear power can at present be used only to produce electricity and not as a direct source of heat. Its rate of installation depends in part, therefore, on the rate at which electricity demand grows and also on the time taken to construct nuclear power stations. Stations ordered now could not come on stream before the early 1980s. Nuclear capacity until then is limited to the amount of capacity already in service or under construction. Thereafter, there are big economic and security advantages in building up the nuclear power component of the energy economy as quickly as possible.
Nuclear power can be expected to be an important source of energy by 1990, but this depends critically upon success in establishing a strong industrial capability in the design, manufacture and construction of nuclear stations and their components, in pursuing development programmes and launching the SGHWR successfully, and in solving any safety and environmental problems.
I have tried to outline the Government's approach to this important subject. The Government's decision to adopt the steam generating heavy water reactor for the next series of nuclear power station orders was taken after extensive consultation and the careful weighing of all the advice received. We believe that our decision was not only right but the only one possible in the circumstances.
The choice of the SGHWR offers substantial advantages. First it will provide power reliably. The Winfrith 100-MW prototype has performed very reliably. The extrapolation to larger sizes will be facilitated by the fact that Winfrith was designed to reproduce the varying conditions which would be experienced in a 600-MW unit.
As I have told the House previously, I have visited Winfrith. I did so when we were in opposition, and I have done so since becoming a member of the Government. I have been very impressed by what I have seen there, before and after becoming a Minister. We realise that there are bound to be difficulties. This has been said previously by all the experts.
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Frank Tombs has always made it perfectly clear that there are bound to be difficulties when dealing with nuclear power, as there would be with any system we tried to tackle. My right hon. Friend has said that many times.
Secondly it is important to maintain public confidence when we deal with the choice of nuclear reactors and matters of nuclear power. The advice of the Chief Inspector of Nuclear Installations is that there will be no fundamental difficulties in giving the SGHWR safety clearance. That point was specifically raised in the debate. I hope that hon. Members will be satisfied with this positive statement.
Thirdly the SGHWR offers particular scope for British nuclear technology. We need to establish a strong industrial capability. It is vital that people working in industry should have sufficient confidence in the development of the programme to invest in skills and facilities, and that the initial order of up to 4,000 MW over the next four years will provide a very sound base for the future.
The question of the progress with the SGHWR programme has been raised from both sides of the House. Part of the history of this matter is that our decision reached in July for a programme of 4,000 MW by the SGHWR for the electricity boards' next nuclear power station orders was controversial in some quarters. However, I think that all parties have agreed to use their best endeavours in implementing it successfully, and they are doing so. We want to see that the programme proceeds rapidly.
At the same time, we must learn lessons from the past. Some of my hon. Friends will know that this is not the first time that we have debated nuclear power in the House and have discussed in great detail the previous generations of nuclear power stations. We have always tried to make the point that we want to learn from the past. The Government are determined on that matter. Therefore, we believe that time spent on careful and methodical planning now should save us time in the long run.
The Department is keeping in close touch with the organisations concerned on the progress of the programme. Since July all parties concerned have been engaged in work on the SGHWR aimed at producing, first, a full analysis of the

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optimum deployment of our resources on the nuclear programme and, secondly, a detailed and costed design and development programme for a 600-660 MW reactor unit, including arrangements for component manufacture. We have already done substantial work in these areas but more will be needed.
I come, thirdly, to the timetable for ordering and construction. The organisations concerned—the nuclear design and construction industry, the electricity boards and the AEA—have all switched their main design and development resources to work on the SGHWR programme.
Mr. Neave: Before the hon. Gentleman leaves the question of the design work, will he say whether, in answer to my question, the Department will set up some machinery to monitor progress on this, so that he can report to the House regularly?
Mr. Eadie: We shall consider any suggestion which would give the House the opportunity to examine the progress that is being made. I hope to try in this debate to illustrate what progress is being made. I have been asked whether there is a lack of enthusiasm. I hope to assure the House that there is no lack of enthusiasm, that the work is being done and that careful scientific assessment is being made. I hope to assure the House that we have learned from the past.
The hon. Member for Abingdon has posed the specific questions whether information will be available to the House and whether there will be monitoring of the progress. The answer is "Yes". We shall certainly make available all possible information.
I was trying to develop the case about the resources and the work and design on the SGHWR programme. I want to assure the House that a massive effort is building up to establish the detailed commercial design and to finalise the safety case. The CEGB proposes to site its first SGHWR at Sizewell in Suffolk. The SSEB proposes to site its reactor at Torness in East Lothian. The boards' applications for consent and deemed planning permission are being urgently considered. If granted, the boards will be able to get ahead with the non-nuclear site preparation work. Orders for the
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stations themselves, however, will be dependent on nuclear site licences and financial approval. Therefore, it is premature to forecast the timetable of these events. Complex issues are involved, but all concerned are proceeding as quickly as possible.
Mr. Palmer: Will these orders be placed with the new British Nuclear Corporation or are they to be placed with the TNPG? Will my hon. Friend deal with the question I asked about the British Nuclear Corporation, as there is not much time left for this debate?
Mr. Eadie: I was coming to that matter. The new body is in the process of being set up. I was about to say that my right hon. Friend will honour the undertaking he gave to make a statement to the House as soon as possible.
The question which my hon. Friend raises is politic and must be dealt with in relation to the whole matter. Therefore, when making a statement the Government look forward to being able to reassure my hon. Friend on his doubts about the new type of organisation. I hope that he will accept that for the moment.
We certainly want to make the most of the SGHWR's export potential. The rise in fossil fuel prices has contributed to the additional demand for nuclear power in many countries, including developing countries. Several countries have expressed interest in the SGHWR, and discussions on engineering and design, and visits to facilities and to the prototype at Winfrith Heath, have taken place. But it may be difficult to convert interest in the SGHWR into firm business before we can show successful progress with our domestic stations.
It is important that we approach this matter correctly. Both we and the Canadians—I take up the question posed by the hon. Member for Abingdon— believe that there is considerable scope for collaboration between the United Kingdom and Canadian utilities in such areas as heavy water reactor design, construction, safety and component development.
United Kingdom organisations are discussing with their Canadian counterparts the form of agreements for entering into co-operation on a wide basis. Negotiations are well advanced for a technical information collaborative agreement

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between Atomic Energy of Canada Limited and the appropriate United Kingdom organisations, including the NNC. Visits and discussions at utility and industrial level, including component manufacturers, are taking place and are planned.
Arrangements are well in hand for the purchase of heavy water from Canada for initial requirements. Whether the United Kingdom will build a heavy water plant is a matter for further study by our electricity boards and other interested organisations. Building our own plant may well be the best way of supplying our SGHWR programme with heavy water in the longer term.
To sum up the progress with the SGHWR, the first priorities must be careful and thorough planning, taking into consideration the preparatory work and a sensible timetable for the programme. The electricity boards and the National Nuclear Corporation are well aware of this. We must avoid the problems of the AGR.
At the same time, the situation on the SGHWR is very different. The SGHWR is at a significantly more advanced point of development than was the AGR when it was chosen in 1965 and there is the added advantage of Canadian experience. The development and the construction of all nuclear reactor systems is a complex undertaking, but I am confident that we can make a success of the SGHWR.
Questions were asked about the fossil fuel implications. I agree with my hon. Friend the Member for Bristol, North-East that our initial 4,000-MW SGHWR programme is relatively modest. From the point of view of energy policy we want to expand nuclear power, but there are reasons why it would be imprudent to go for a large programme now.
First, with the SGHWR we should be moving forward from a prototype to a commercial design. Secondly, our nuclear industry, which has been without orders since 1970, has limited resources. We have confidence in the SGHWR, but we must not rush the planning and execution of the first commercial programme of SGHWRs.
The total amount of the SGHWR capacity will be less than the PWR programme that the CEGB had under consideration. The realism of a large PWR
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programme has been very much open to question. We have had many arguments about it in the House. The key consideration is that until the Nuclear Installation Inspectorate completes its safety studies and can say in principle whether it can accept PWR for operation in the United Kingdom, the PWR cannot be a real option for a Government decision, There are also delays and difficulties of absorbing successfully, without delay, the new technology, design approach and manufacturing standards involved in the PWR.
We shall have to meet the balance of our requirements with fossil fuel plant. We are well placed to do this with major fossil fuel reserves.
My right hon. Friend the Secretary of State has said in the House that he wants to implement successfully our nuclear power programme announced in July, and particularly the SGHWR, with a view to stepping it up in the light of experience. The initial programme, in our considered view, is large enough to give the nuclear industry the opportunity and the confidence to make the investments needed but without leading to over-ordering or overcapacity. I believe that it provides the base for enlarging our industrial capability as necessary in the years to come.
The most important thing is that we have taken a decision which was long overdue in this vital aspect of energy policy. I think we have marked out to some extent the path on which we are proceeding and we are implementing our programme.
Both the right hon. Member for Wanstead and Woodford (Mr. Jenkins) and my hon. Friend were keenly interested in the National Nuclear Corporation aspect. It must be realised that the National Nuclear Corporation is already functioning, but progress on making the corporation fully operational is inevitably dependent on the settlement of very complex negotiations for the acquisition of the two existing consortia companies with their staffs and power station contracts in progress. I understand that the negotiations between the NNC, the consortia and the electricity boards on the acquisition have now reached an advanced stage.
It would be inappropriate for me to say more at present on the shareholding

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structure until all the necessary discussions with GEC and the other shareholders in NNC have taken place. My right hon. Friend has undertaken to keep the House informed, on what we ourselves regard as a very important aspect of the organisation of the nuclear power programme. I reaffirm that assurance this afternoon.
It is important to stress that the Government have substantial reserved rights in the operation of the Corporation—for example, over the formation of international links and the maintenance of an open purchasing policy where the public interest is closely involved. Therefore, these rights will help to ensure that, whatever the Corporation's ultimate shareholding structure, its operations are in the interests of the nation as a whole.
If in the course of examining my notes I find that there are some points to which I have not replied, I undertake to reply in writing to hon. Members who have taken part in the debate.

FISHING VESSELS (GRANTS)
12.17 p.m.
Mr. John Stanley: A number of hon. Members expressed a measure of incredulity that the hon. Member for Tonbridge and Mailing, representing a totally landlocked constituency, should wish to initiate a debate on the operation of the grant system for fishing vessels. Indeed, Mr. Speaker, one hon. Member even had the temerity to suggest that there might have been an administrative error in your own Department, but such things never occur and one has not occurred on this occasion.
I have in my constituency a major manufacturer of fishing vessel hulls which specialises in a particular type of material for hull manufacture. I refer to the Tyler Boat Company, which is engaged in the manufacture of what are known as glass reinforced plastic hulls, which I will for the convenience of the House subsequently refer to as GRP. This, as the Minister of State will know, is a relatively new branch of the vessel construction industry but a growing one.
Though this problem that I wish to raise has been brought to my attention by a particular company in my own con-
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stituency, I believe that it is a common problem that is shared with all those other firms which are engaged in the manufacture of hulls out of GRP. Indeed, I have today received a letter from a company called Halmatic Limited, of Havant, which is engaged in exactly the same type of construction as the Tyler Boat Company. This company, knowing that I was to have this debate today, has made exactly the same point to me as the firm which is situated in my constituency.
The Minister of State will be aware that the technology of the construction of fishing vessels has begun to change appreciably and that fishing vessels are now not always constructed of the traditional steel and timber materials. Today many fishing vessels are being constructed with GRP materials.
The rules for the making available of grants through the White Fish Authority have not, as far as I can see, been sufficiently adapted to take into account the presence of this new material for the construction of hulls for fishing vessels and, in particular, have not been adapted to the particular problems and constraints of production where GRP is involved as opposed to steel and timber.
The rule that I want to mention in particular is the rule that no grant is available unless, before any construction work starts, there has been approval of the grant by the White Fish Authority. This, as the Minister will appreciate, denies fishing vessel manufacturers the possibility of building for stock in GRP materials. This has very considerable commercial implications for their businesses. It is a rule which appears to be extremely rigidly applied, and I will refer to one point in particular to illustrate it. The Tyler Boat Company in 1972 began the development of a new series of GRP fishing vessel hulls, and it produced the first prototype of that series. The company built it exclusively to White Fish Authority specifications and the hull which it made was designed to incorporate all the machinery, electronics and so on which would meet the White Fish Authority specification.
Because the hull had not been approved by the White Fish Authority prior to the start of construction, the authority was not able to make any grant available, even though a large number of approved

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fishermen were willing to purchase this vessel. This episode had a somewhat ironic twist because the boat was rendered more or less unsaleable as a result of the application of this rule, and it was finally purchased by the Department of the Environment at a bargain basement price. I always endorse a good buy by the public sector, but the Minister will appreciate the sense of frustration of this firm at having had a vessel rendered impossible to sell through the normal channels by the operation of the rules of one Government Department, and having to sell it at a very much reduced price to another Government Department.
The effect of not being able to build for stock on those engaged on the construction of GRP hulls is considerable. This is because these firms are engaged in factory production methods in the construction of their work. Unlike the construction of hulls in steel and timber where it is possible to have a considerable unevenness in the work load to construct a number of vessels, and to discontinue the construction for a short period, the techniques and equipment involved in the construction of GRP hulls demands a reasonably even work load. Because of these factory production methods, some extremely expensive equipment is necessary for the moulding work in particular, and it will be evident that to get the most economic use of this equipment it is important to have a standard hull which can go into series production. Only in that way is it possible to get real economy and value for money for the ultimate purchasers, the fishermen.
Again, if it is not possible to build for stock, the companies concerned are not able to offer particularly rapid delivery dates. It is not possible for fishermen who may qualify for a grant to purchase a vessel off the shelf, so to speak. Therefore, delivery dates are extended, and this has adverse implications for the potential export business of these companies.
One final important point is that as long as these companies are not able to build for stock they are in a difficult position when they want to launch a new type of design. When a new design is launched it is essential to have a prototype model which can be used for demonstration purposes for potential buyers. There is no alternative but to build a
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prototype model for demonstration purposes, but that prototype model will not in any circumstances be able to qualify for a White Fish Authority grant because the grant is only available if it has been approved prior to construction, and that approval is tailored to the prospective purchase by a single approved fisherman when the boat has been constructed.
The Minister will appreciate the serious constraints which are placed on these firms as a result of the application of this rule. The companies concerned are not in any way trying to circumvent the control that is at present exercised by the White Fish Authority. They fully recognise the need for this control. They believe that it is perfectly possible to enable them to build for stock without reducing the control exercised by the White Fish Authority. The companies recognise that there must be public accountability because it is public funds which are used for the grant. In addition, they recognise that there must be regular inspection both at design stage and during the construction phase of all vessels used by United Kingdom fishermen to meet the necessary safety requirements laid down by the Department. The companies believe it is possible to meet these public accountability and safety requirements while still being allowed to build for stock.
If the building for stock is allowed, the White Fish Authority can continue to inspect, supervise and approve the initial drawings and design plans. The authority can continue to inspect during construction, and it can continue to inspect the finished article. Therefore, the relaxation of this rule is wholly compatible with the maintenance of the necessary control which should be exercised through the White Fish Authority.
Unless building for stock is allowed, the United Kingdom fisherman will continue to have to pay more than he necessarily should for a vessel which is made out of GRP materials. He will have to pay more because the companies engaged in this form of construction will not be getting the full economy which their production process allows. As the fisherman will pay more, there is imposed here an additional and unnecessary burden on public funds, because the grant represents a percentage of the actual cost

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of purchase which is incurred by the fisherman, and therefore, if it is possible to reduce the cost of the boat it is also possible to reduce the amount of grant which has to be paid.
I suggest that there is here a clear-cut case for endeavouring to relax the rule to enable these companies to build for stock. I hope that the Minister will be able to respond sympathetically and positively to what I have said, and thus help a growing, thriving and potentially economically important industry.
12.27 p.m.
Mr. Kevin McNamara: The House is indebted to the hon. Member for Tonbridge and Mailing (Mr. Stanley) for initiating this debate. If I do not follow him in the ramifications of his constituency problem, I think he will agree that the question of the operation of the grant system covers not only his type of vessel but those vessels which sail out of the Humber ports.
In particular, we are concerned about the grants which our vessels will get as a result of applications which have been made for subsidies. I was surprised that when we met the vessel owners they had not seen fit to approach my trade union to ask it for its support in their application for grant. I find this even more surprising because of the good relations which have existed between the union and the owners in the past few years, and particularly because the owners were keen to have the co-operation of my union during the Icelandic fishing dispute. I should have thought that in the interests of good industrial relations, and also to give more power to their elbow, they would at this time, with a Labour Government in power, have asked the union to join them in their approaches to the Minister in connection with problems facing the industry.
If the vessel owners are to get the grants for which they are looking for their vessels, it seems to me, particularly with a Labour Government in office, that any Minister considering giving a grant should say to the industry "Is it not about time that you put some of your own industrial relations in order? Is it not about time that you started positive negotiations to decasualise the work force?" because from the age of 45 onwards a man may
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never know whether his calling as a fisherman has gone for ever. They should say to the owners "Why do you not look for ways of getting the Contracts of Employment Act and the Redundancy Payments Act applicable to your industry? Why do you not have a proper system of recruiting so that a tragic death such as that which occurred when the "Gaul" was lost could not happen again, because no ship should sail with a man on board who has signed articles only after the ship has sailed? Why do you not try to organise a proper pool of fishermen and a properly controlled basis between the unions and the employers on the lines of the dock labour scheme or the pool operated for merchant seamen?"
If the employers are concerned, as the President of the Vessel Owners' Association said in his message to the industry, about the hard times that are ahead regarding both the viability of the industry and the pressures that will come from international matters concerning the extension to the 200-mile limit, the Labour Government should insist that they put their own industrial house in order and get rid of the casual nature of the industry.
The present dispute at the fish dock in Hull would have been better resolved, much more quickly, if the owners had been under an obligation to pay men whilst they were unable to sail rather than that they should have to exist, even though on articles, on State support.
If the industry is to establish a proper claim for grants for these vessels, it has to establish its own case. Two points are evident. First, the industry is not quite certain what sort of subsidy it wants, whether it wants an operating subsidy for one group of vessels, or a subsidy on the basis of an intervention price or a deficiency payment if fish does not reach the price which the owners think it should reach in the market.
We do not know the precise losses which the industry faces. We have been given various figures. We know that the favourable oil contracts which the industry on Humberside had run out at the end of this year, and that there will be considerable increases in costs. We understand that, since these problems affect industry generally. We recall the record profits made from fish landings in

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Hull this time last year and at the start of the new year. There were record catches then, one after the other.
We do not know what the precise profits of the industry or of the individual companies have been. Only one major public company is involved. All the others are private companies. It seems to me that, private companies or not, the figures of last year's profits must be established for the information of the British public. There must be a clear definition of profit and of public accountability. It is not sufficient to go to the Ministry and say "These are our figures." The public has a right to know if there are to be further calls on public funds. Indeed, in every other industry, where applications have been made for subsidies of one sort or another, the figures of company profits have been given. It is essential that we should be able to see those figures, because the degree of secrecy, which is a traditional attitude in the fishing industry on Humberside, makes it extremely difficult for people wanting to see a flourishing industry, with full employment, to make any sort of case when we do not know what are the precise figures.
Therefore, I urge the Minister that if a subsidy is to be granted he must demand of the companies that they establish their right to receive it, not merely from the Government, but with the British public, as anybody else has to do.
Mr. John Prescott: Does my hon. Friend agree that it is a source of confusion when people see that the price of fish does not come down, yet the owners tell us they are making tremendous losses? We need to take this problem seriously. One of the contradictions is that, although the European Commission is being asked to look at subsidies for its own fishing industry and is seeking this kind of information from European fishing companies, Members of Parliament cannot obtain access to information concerning the economics of operation in the interest of public accountability, and we should not agree to any subsidy unless we are given such information.
Mr. McNamara: This is the contradiction. Although British fishing vessel owners want information about their European counterparts, they will not
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apply that information to us. This is a matter of considerable importance.
There is a great deal of frozen fish in stock, and there is bound to come a time when the economics of keeping that stock will be such that we shall have to flood the fish on to the market. We are already experiencing problems with white fish, particularly at the Boston market, which are causing concern to the industry.
I accept that if the industry is facing difficulties, and if we are to have proper employment in industry and to maintain an economically viable industry, it may well be that a case must be made for subsidies. But for the owners merely to put out statements of how much it costs a trawler to run today compared with how much it cost last week, and to make other vague statements, will not satisfy the British public, particularly at this time of financial stringency. It will not satisfy people when they know the whole absurd nature of employment practices within the industry.
We shall be glad to know what progress has been made with the application for subsidies and whether the Minister will bear in mind the points I have made. The Minister should say to this secretive industry "If you have a case, you must make it in full and give us all the facts". The mere generalisations we have heard are not sufficient. The industry faces problems, but assistance can be given only when the Government understand all the information and the whole problem. Merely to say "Give us the medicine" without telling us precisely what all the symptoms are is not good enough.
12.37 p.m.
The Minister of State for Agriculture, Fisheries and Food (Mr. E. S. Bishop): I am indebted to the hon. Member for Tonbridge and Mailing (Mr. Stanley), who initiated this debate, because it gives the Government a chance to clarify some of the aspects which have been expressed in the correspondence between his constituents and the Ministry.
The hon. Member pointed to certain difficulties which may arise for certain vessel constructors. He mentioned two companies in connection with the problem of obtaining grants for fibre glass reinforced plastic hulls and the problems arising with regard to other companies.

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To look at the problems which have been raised it is important that we should know the rules which apply for the provision of grants. The problem affects vessel constructors, especially those using new techniques of construction and new materials, particularly those engaged in continuous processes such as the reinforced glass fibre process for hulls, to which the hon. Member referred, through the application of the administrative rules relating to the grant. Those rules are intended to safeguard the money voted by the House.
The rules have remained consistent throughout successive schemes and provide that the work to be grant aided should have prior approval. The hon. Member made that point in connection with the White Fish Authority and the Herring Industry Board. Secondly, the two authorities must satisfy themselves that the work has been carried out in accordance with the agreed specifications, and thirdly, that they shall have the right to inspect the vessel concerned during construction. This may be the point where the differences may arise regarding manufacturers.
These arrangements are no more than is usual in similar schemes involving public expenditure in other areas. But that is not to say that the authorities are inflexible in their application of the rules. It has proved possible in the light of experience to make approval more or less automatic for certain standard items of proved quality. That is a matter which the hon. Gentleman should bear in mind when he suggests that the present position creates difficulties for people who want boats made to a standard specification.
However, extension of this principle to embrace finished complete vessels embodying a great number of components brought together from differing sources—even small fishing vessels are quite sophisticated nowadays—is a very different matter. There would be real problems in doing so, and we would not wish to risk the waste of public money or the safety of fishermen's lives by the automatic approval of devices or construction methods until they had proved themselves under operating conditions. This is very important. We are concerned not only with the use of public
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money but with ensuring that the standards of vessels are adequate in terms of seaworthiness and the safety of those who operate them.
Mr. Stanley: Before the hon. Gentleman leaves the subject of safety, it is clear that the White Fish Authority has an absolute obligation to concern itself with the safety of fishermen, and it would be wrong for it to give grant approval simply to drawings. But where equipment exists and where whole hulls exist which have the necessary operational experience, once it has been decided in principle that they meet the White Fish Authority's requirements, surely there is no reason why approval should not be regarded as applying to series production.
Mr. Bishop: I appreciate the hon. Gentleman's point. However, the White Fish Authority must be satisfied not only with the specification and that it is adequate to do the job expected of the vessel but also that the processes of construction at various stages are adequate to ensure that the specification is met.
Mr. Stanley: I hoped that I had covered this matter in what I said earlier. There is no question of any of the firms to which I referred wishing to change the right of the White Fish Authority to do any inspection work that it likes during the constuction process in series production. What they want is the assurance that where a given set of equipment or a hull has the necessary approval of the authority, they can go ahead and build for stock knowing that grant will be forthcoming. This does not inhibit or reduce the right of the authority to make inspections during construction.
Mr. Bishop: I take the hon. Gentleman's point. Perhaps I might deal with some of these matters in my subsequent remarks.
The grant scheme is to assist those engaged in the fishing industry. It does not aim to interfere with sensible and progressive building operations in the shipyards, and I am satisfied that the statutory bodies do all they can to avoid such interference. Of course disagreements may arise from time to time over technical matters, but I am sure that the statutory bodies do their best to deal with points as helpfully as they can consistently with the proper discharge of

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their statutory responsibility for ensuring that the use of public funds is properly safeguarded.
I want now to give a little of the background to the fishing vessel grants, which, the hon. Gentleman may know, are paid under the Fishing Vessels (Acquisition and Improvement) (Grants) Scheme 1967, and that has been amended by the Fishing Vessels (Acquisition and Improvement) (Grants) (Amendment) Scheme 1971 and by the annual renewal schemes of 1973 and 1974. Under the Sea Fish Industry Act 1970, grants on new fishing vessels and on improvements have been payable by the Government through the White Fish Authority and the Herring Industry Board. Rates have varied from time to time reflecting Government policy and the need to control public expenditure. But the point should be made that the purpose of the schemes has remained constant—to provide the necessary incentive to invest in new or modernised vessels so as to ensure the maintenance of an efficient fishing fleet able to supply a continuous and adequate supply of fish.
That background to the operation of the grants legislation is important. Applicants have always been required to find the major proportion of expenditure from their own resources with the aim of ensuring that the design and investment decisions have been taken primarily for commercial and operational reasons.
I move on now to deal with the requirements which have to be met. All the schemes made have carried the same statutory clauses to safeguard public money. They include the need for prior approval by the statutory authority of plans before contracts are made. I am sure the hon. Gentleman will accept that as being reasonable. Then the White Fish Authority or the Herring Industry Board must satisfy itself that construction, etc., is carried out in accordance with the agreed specifications—
Mr. Stanley Mr. Stanley rose—
Mr. Bishop: I suspect that the hon. Gentleman may be seeking to return to his point about this.
Mr. Stanley: The key question here is the need for prior approval. Does not the hon. Gentleman agree that, once a
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specification has been laid down for, say, a hull and approved by the White Fish Authority, if the hull then goes into series production and identical hulls are coming out one after the other, there is no reason why it should be necessary to get prior approval for each hull? Surely that is logical. If there is to be insistence on prior approval for totally standard, identical hulls, the result is the loss of the economic benefit to the fishermen and of the commercial benefit of series production.
Mr. Bishop: I quite see what the hon. Gentleman is saying. However, I remind him that the grant is payable to the person ordering the vessel, not to the manufacturer. I think that that is the situation as it should be. After all, the person wanting the vessel has to put in a claim for the use of the vessel. The specification and the contract have to be approved. This is a commercial matter and not just a matter of grant eligibility and of making sure that the vessel is made to specification. Inspection is made at various stages of production. It is in the interest not only of the Government who pay the grant but also of the purchaser that the inspection should be adequate.
The White Fish Authority is not inflexible on this, and all that it needs to be satisfied about is that the money being paid from public funds is paid in a way which is justified. I emphasise that the two authorities concerned ought to have the right to inspect vessels at any time during construction or improvement and on completion. Therefore, there are problems when vessels are taken out of stock. However, I am sure that these are matters which can be discussed with the two authorities concerned. As I say, they are flexible in their approach to these matters.
The hon. Gentleman's constituents have said that they would like to consider the question of the safeguard. It has been looked at by the Department, and I think that the procedure so far followed by the two authorities is adequate and proper for the payment of the funds.
My hon. Friend the Member for Kingston upon Hull, Central (Mr. McNamara) made several other points which should be borne in mind. He asked about grants for vessels and the financial statements which are made to the Government in order that we may take account of the

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financial situation of the industry when considering grants, subsidies and general support.
The House will be aware that the present arrangement expires at the end of this month. My right hon. Friends the Minister of Agriculture, Fisheries and Food and the Secretary of State for Scotland have had consultations with the statutory bodies and the bodies representing the industry about the future of the schemes. They intend to lay before the House an order, which will be subject to affirmative resolution of both Houses, providing for an extension of the scheme to cover the calendar year 1975.
It has been decided that the present distinction of five percentage points between vessels of up to 80 ft. and others is no longer relevant to the fleet situation. Hence the rate of grant will be the same for all vessels.
Clearly the industry might have liked a rate of 30 per cent. grant for all vessels, but we cannot neglect the impact this might have on public expenditure. At the current rates of grant it was necessary for our predecessors to impose a moratorium on grants for several months earlier this year. The present Government were able to lift that moratorium last June. To lessen the risks of such a situation arising in future, the order will provide for a single rate of grant of 25 per cent. for all vessels. My right hon. Friends are satisfied that this will constitute an adequate incentive for the level of investment we need and will ensure that operational considerations are paramount in the design of vessels and in improvements rather than the existing small differential rates of grant.
Having referred to the present and future situation in relation to grants, my hon. Friend talked about other aspects of financial aid through subsidies for fishing. The Government have received representations on the subject of the subsidy from organisations representing the trawler fleet. These representations raise many difficult and complex issues which we must examine with care. I cannot at this stage give any indication of the outcome, but we recognise the need for urgency in the matter.
My hon. Friend raised queries about consultations with the trade unions. There
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is no statutory obligation for consultation to take place with any particular bodies, although, of course, we have consulted the British Trawler Federation and other organisations about future policies. As I pointed out a few weeks ago in the House, if the unions have any representations to make we shall be pleased to receive and consider them, but I must tell my hon. Friend that none has been received. I hope that he and the unions concerned will bear this in mind.
My hon. Friend also spoke about the industrial relations aspect. I remind him that this is a matter for my right hon. Friend the Secretary of State for Employment and that he will be able to make representations in that direction.
Mr. McNamara: Surely my hon. Friend is not saying that his Department is not concerned that there should be good, happy, convivial industrial relations in an industry to which public money is going.
Mr. Bishop: I thought it unnecessary for me to say that good industrial relations are essential in all industries, including the fishing industry, which has its own particular problems. But it is a matter for my right hon. Friend the Secretary of State for Employment and undoubtedly it is being borne in mind by him.
On the aspect of the grants being payable to ensure proper working conditions for officers and crew, I remind my hon. Friend of the provisions of the current legislation with regard to grants. Statutory Instrument No. 372 of 1967, dealing with sea fisheries, boats and methods of fishing, states:
"No grant shall be payable under this scheme in respect of an improvement unless the appropriate authority are satisfied that the expenditure in relation to which it will be payable is likely to result in an increase in the efficiency or economy of the operation of the vessel".
Amongst the aspects taken into account are the catching of fish, the handling, processing and storage of fish, and the working conditions of the officers and crew. Another is the safety and seaworthiness of the vessel. Quite properly, as my hon. Friend implied, we have regard to the conditions in which the crews have to operate—not only their safety but also their general conditions and comfort.
My hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott)— who has had to leave for Hull where he

2049
is attending a visit by my right hon. Friend—spoke of the need to know the figures in relation to the EEC. This is a matter which one would like to take into account. If my hon. Friend will write to me about it, I will look into it.
My hon. Friend the Member for Kingston upon Hull, Central also referred to the evidence and figures given by the British Trawler Federation and others about financial aid. The figures are made available to the Government, who have to consider them. These things are in some cases matters of commercial judgment, but the Government have to take due notice of them. I am sure it is not possible to make the figures public because of the commercial considerations. In any case, when decisions are made we are subject to scrutiny by the House and would need to justify our policy in relation to the evidence which had been put before us.
Mr. Stanley: I have listened most carefully to the hon. Gentleman, and having done so I do not believe that there is any incompatibility between what I have said and what he has said. I do not think there is any incompatibility between giving those who are manufacturing GRP hulls the ability to manufacture standard hulls for stock and retaining the right of inspection by the White Fish Authority that is the necessary requirement of public accountability. I hope that the hon. Gentleman will enable me to see him to discuss the matter further.
Mr. Bishop: I think there is only one boat involved, but the White Fish Authority is flexible about the general rules and there is no particular rule about GRP hulls.
No doubt, as a result of this debate and the representations made by the firm concerned and others in the industry, we shall continue to bear in mind the need for changes which may result from the new technology and methods of production which may make such reconsideration necessary.

KNITTING MACHINERY
1.0 p.m.
Mr. Jim Marshall: It is indicative of the serious situation facing the textile industry in Leicester that I, with my hon. Friends who represent Leicester constituencies, thought it necessary to bring its difficulties to the attention of Parliament and the country.
Most people know that Leicester is famed as a prosperous city. I should hasten to add that it acquired that reputation during the 1930s and that it is not necessarily true today. However, compared with the country as a whole it is undoubtedly still far more prosperous than many other areas. That prosperity has been based on a number of industries, one of which is the textile industry. The city encompasses the whole spectrum of the textile industry—from the textile knitting machine section to the dyeing and finishing sections. The city is world renowned for its textile technology, and the development of one section of the industry has reinforced and underpinned developments in other sections, particularly by the interchange of personnel and ideas between sections.
However, we in Leicester have become seriously worried about the textile knitting industry in the city as a consequence of the dramatic decline in the world demand for knitting machinery. Only two years ago the textile knitting machinery industry in Leicester was responsible for supplying 30 per cent. of the world market in such machinery. Now it is finding it difficult to maintain a share of just under 15 per cent. of a world market which is much smaller than it was two years ago.
Let me remind the House of the reasons for the decline. Some are within and some are without the Government's control. The main reason undoubtedly has been the sharp drop in demand for textile knitting machinery because of the sharp decline in consumer demand for double jersey products which has naturally worked its way through the system so that the hosiery manufacturers no longer require the same number of knitting machines. The industry has been accustomed to the cyclical nature of the industry, but on this occasion the downturn has been so pronounced that it has led to serious difficulties on the machine

2051
side. To a great extent that is outside the Government's control, and I cannot blame the Government for the decline.
There are, however, other factors which the Government could do something about controlling. They concern mainly the unfair competition which the manufacturers in Leicester believe, rightly, they face from foreign competitors. I am told that Italy gives a direct subsidy to its principal manufacturer, Egam. I am told that there is evidence that the French, German and Spanish banks, with connivance, either open or closed, of their Governments, are aiding the knitting machinery producers.
The Czechs are able to sell a machine in this country at £1,000 less than the cost of the equivalent British machine. There appears to be no economic reason why there should be that difference between the prices of the two machines. I am led to the conclusion that the Government of Czechoslovakia are providing a subsidy, cither direct or indirect, to the Czechoslovak knitting industry.
On the hosiery side, which must eventually come to bear on the machinery side, there is a flood of cheap imported knitted goods coming into this country from the Far East and Eastern Europe. This means that there is considerable under-capacity among the hosiery manufacturers in this country, with a consequent marked decline in the demand for textile knitting machines. This is a further reason why the knitting machine manufacturers are experiencing difficulty.
Another contributory reason which I believe the Minister of State acknowledges is this. The textile knitting machinery industry has not been notable for its efficient and remarkable management. Recently a firm in the city went bankrupt largely as a result of bad management.
Whatever the reasons, there is a serious situation in the city which becomes more serious week by week. In the past two or three years 2,600 jobs have been lost in the city. Stibbe recently made redundant 900 men. Cotton recently made redundant 1,320 men. The Wildt Mellor Bromley Group has made redundant sizeable numbers of men. We are told on good authority that before the end of the year a further 147 men will be made
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redundant by the Wildt Mellor Bromley Group at its Aylestone Road factory. This indicates the serious situation which not only the city but the textile knitting machine manufacturers are facing.
In addition to the job loss, there is a genuine possibility of a technological loss which in the long term may be more significant than the short-term job loss. Design teams are being broken up, and we know from experience in other industries that once design teams are broken up it is extremely difficult to build them up rapidly again when the market requires further research and development.
In recent years Stibbe has made an electronic leap in knitting machines with its new machine called the Patent Master. I hope that the Minister of State will say that such advances in electronic technology will not be lost.
In Leicester the bulk of the ownership in the knitting machine industry is in the hands of Sears Holding Company. I do not wish to criticise the management of that company, but it is well known that the chairman is far more interested in holding liquid assets rather than capital tied up in manufacturing industry. I believe that to be a contributory factor to the uncertainty in the industry.
We in Leicester believe that the Leicester industry, which contributed so much to the balance of payments surplus in recent years and to the worldwide development of the industry, must not be allowed to disappear. It has contributed greatly to our balance of payments and has earned us a lot of money. It is also of world renown for its developments in textile technology. I urge the Government to investigate possible areas of action, which I will list.
First, the Government should set up a twofold inquiry with the aim of discovering whether the industry has been mismanaged in the past and, of more importance, whether it is subject to unfair foreign competition. Secondly—and this is related to my comments on Sears Holding Company—is the present ownership of the industry the best to ensure its continued survival?
Thirdly, I urge the Government to support the development of knitting machines. Only by research and development can we ensure that when world

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demand again increases Britain will be in the forefront of production of the most modern machines. Fourthly, I urge the Government to give help in the form of tax allowances to purchasers of knitting machinery.
If the Government will investigate these four matters and decide what help is required, we can ensure the continued survival of the textile knitting machine industry in Leicester.
1.13 p.m.
Mr. Greville Janner: I congratulate my hon. Friend the Member for Leicester, South (Mr. Marshall) on his immediate and constructive speech and on the efforts which he made previously within Leicester Corporation to assist the city.
I speak also on behalf of my hon. Friend the Member for Leicester, East (Mr. Bradley), who is on other duties. I know that he will wish to associate himself with what my hon. Friend and I say about the need for the Government to take action to preserve this mighty and extremely vital industry. I make a plea to the Government for help to overcome unfair competition from overseas and to face the inevitable contraction of overseas demand for hosiery knitting machines.
My hon. Friend referred to the collapse of Stibbe, which was the most important company of its kind in my constituency. That collapse was caused by disgraceful mismanagement. With a loyal labour force and no industrial disputes, the company was bedevilled by squalid family quarrels. The mismanagement and incompetence were by-words in Leicester. During the final week before the receiver was called in, the chairman of the company had the impertinence to negotiate with the work force for increases in pay, but did not inform the two Labour Members of Parliament for the city at that time that the company was going into the hands of the receiver until the receiver was actually called in. To top it off, he had the impudence to blame the Labour Party for the downfall of the company, which has caused so much hardship to my constituents this Christmas.
I publicly thank my right hon. Friend the Secretary of State for Industry, my hon. Friend the Minister of State and
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officials in the Department for doing what they could to save this company. It is a great pity that they, and we, failed. However, it is vital that the rest of the industry, particularly those parts of it which are well managed and have made a great contribution to our overseas trade, should be enabled to continue to do so. Management must pull up its socks, and I hope that the Government will help. The city has the pledge of all three of its Members of Parliament to co-operate in every possible way to assist the industry. We believe that, in spite of the difficulties, by a united effort we shall succeed.
1.15 p.m.
The Minister of State, Department of Industry (Mr. Eric Heffer): I congratulate my hon. Friend the Member for Leicester, South (Mr. Marshall) on securing the Adjournment debate. In all the years in which I have been in the House I have never yet been successful in doing that. I congratulate my hon. Friend also on his first-class speech. The people of Leicester should be well satisfied with the type of representation they have. My hon. Friend put up a fine case, in which he was ably supported by my hon. and learned Friend the Member for Leicester, West (Mr. Janner).
It almost goes without saying that the Government recognise the importance of the knitting machine industry in Leicester, and of the whole of the textile industry collectively. We are naturally concerned about the position in Leicester, and we went out of our way to try to assist the industry in certain difficulties.
Rendundancies in Leicester amounted to about 850, which is about 19 per cent. of the work force, and about 1,500 employees outside Leicester have been made redundant. That is a serious position. Most of the Leicester redundancies —that is to say, 500—occurred at the Braunstone factory of G. Stibbe and Company following the failure of the company and the appointment of a receiver in September this year.
My hon. Friend the Member for Leicester, South said that Leicester is not in the same position as are certain other parts of the country. We have noted that about 300 of the redundant Stibbe workers have already found alternative employment. In addition, it appears that a further 100 former Stibbe employees

2055
who left the company without waiting for reundancy notices have also found other work. Although the position is not good, the latest unemployment figures for Leicester are better than those in many other areas. The total number of unemployed is 4,800, which is 21 per cent., lower than the national average of 2·6 per cent. Unfilled vacancies number about 2,750, which is 57 per cent., of the total unemployed.
I wish to put clearly on record, coming from me, that if I were representing Leicester I should never be satisfied with any percentage of unemployed that was higher than the unemployable percentage. No one should ever be complacent about redundancy and unemployment.
Mr. Greville Janner: Does my hon. Friend appreciate that we are worried particularly about the future?
Mr. Heffer: I shall come to that point in a few moments.
If I may deal with the situation regarding Stibbe, the firm approached the Department's industrial development unit in July this year to discuss informally possible Section 8 aid for its Braunstone factory because the firm said it had a liquidity crisis. The company at that stage was advised in the first instance to explore more fully other resources, with further discussions to follow. There was a second meeting with the IDU in early September, and at that meeting the company set out more fully its need for financial support.
The company considered the matter in some depth and it became clear that the Braunstone factory would not be viable in the longer term due to its dependence on a limited range of product liable to cyclical demand, and the company accepted that it should seek some form of association with other interests which could provide a wider product base.
The case was drawn to the Secretary of State's notice on 25th September when it appeared that the Department's efforts to bring about such a grouping were being forestalled by the imminent appointment of the receiver. All possible avenues of providing assistance to the firm were examined, and a case for Section 8 assistance was submitted to the Industrial Development Advisory Board
2056
on 26th September. The IDAB recommended that Industry Act assistance could not be justified to maintain the Braunstone factory, though it supported the Department's efforts to save the business, which had traded profitably for several years. The Secretary of State, having seen the IDAB report, expressed the view that he was most anxious that every assistance should be given to find purchasers for the viable parts of the business and assumed that Industry Act assistance could be made available for any prospective purchaser of the S. A. Monk business in Sutton-in-Ashfield.
I take my hon. Friend's point about future technology. I agree that it would be a great shame if the technological know-how of the design team were to be lost. The Government appreciate that consideration.
Sutton-in-Ashfield is an intermediate area, and assistance can be given under Section 7 of the Industry Act. Indeed, the Government have made it clear that we are only too keen to give assistance in this way, provided that the circumstances are right. I repeat that we do not want to see the technology lost, for that would be a great shame for this country.
There is no question that there has been a downturn in the world trade situation, and my hon. Friend the Member for Leicester, South outlined the basic reasons. There was an extremely rapid growth in world trade for circular knitting machines during the 1960s from £20 million in the 1960s to approaching £200 million in 1972. The United Kingdom has been recognised worldwide as the technological leaders in this industry. In the peak year of 1972 our exports totalled £43·3 million, over 20 per cent. of world trade, second only to the Federal Republic of Germany with exports of £74 million.
Since that time exports of all the principal manufacturing countries have declined, with the exception of the United States, although the decline between 1972 and 1973 in the case of the United Kingdom amounted to 19 per cent., which was somewhat higher than that of our principal continental competitors, France and Germany, whose exports fell by 10 and 13 per cent. respectively.
The latest figures of United Kingdom overseas trade show that during the period

2057
January to October 1974 our imports of circular knitting machines fell by 26 per cent., against the comparable period in 1973, to £4·2 million, while during the same period our exports fell by 23 per cent., to £24·4 million. Thus, we have continued to show a favourable trade balance this year amounting to £18·7 million in a situation of declining trade, and our industry appears to be holding its own in the domestic market in face of strong foreign competition.
I should like to turn to the future prospects for the industry. The problems in Leicester brought about by the decline in the world market for double jersey circular knitting machines have created problems for all the companies in this sector. Bentley Engineering, the largest manufacturer in the world of such machines, with about three-quarters of total United Kingdom production, was in a relatively strong position to weather the storm because of its size and wide product base.
The regrettable closure of Stibbe's Braunstone factory need not involve a loss of its knitting machinery technology, and there is strong ministerial interest in providing assistance for any proposals which will maintain the United Kingdom capability, particularly in the context of maintaining the remaining Stibbe unit at Sutton-in-Ashfield.
We are not aware of any closures or redundancies among any machinery manufacturers in the Leicester area outside Stibbe and the Bentley Engineering Group. We believe that the remaining firms in this sector will be able to continue in business, though on a reduced scale until the market picks up again, which we expect to be in 1976. The redundancies which have occurred have to some extent reflected the decline in world trade, but the firms have been able partly to offset the effect of the decline in trade and thus limited their redundancies by taking on general engineering sub-contract work.
I shall not go into all the background concerning the firm of Stibbe, but this matter was brought to ministerial notice on 11 th November when my hon. Friend met the Under-Secretary of State for Industry. It is probably regrettable that the matter was not brought to ministerial notice before that date, but that is the
2058
situation, and my hon. Friend the Undersecretary of State did everything possible at that stage.
My hon. Friend advanced four reasons for urging the Government to set up an inquiry. He raised a number of points about import controls and mentioned various foreign countries. He suggested that other countries are subsidising the textile machinery industry or parts of it. We have no knowledge of that situation, and if my hon. Friend the Member for Leicester, South has any evidence I hope that it will be forthcoming.
Many of the matters raised by my hon. ,and learned Friend the Member for Leicester, West are not the responsibility of my Department. I do not seek to hide behind the ministerial office, but the fact is that those matters happen to be the responsibility of the Department of Trade and the matter of imports is not our concern. However, I shall see to it that my hon. Friend's points are drawn to the attention of my right hon. Friend the Secretary of State for Trade. I assure him that will be done.
Mr. Greville Janner: I thank my hon. Friend.
Mr. Heffer: I cannot say that an inquiry will be set up, but the point made on that topic will be clearly noted. We will examine what has been said. At this stage the Government have no intention of carrying out such an inquiry, but the point has been clearly noted. I shall see that these matters are drawn to the attention of the relevant Ministers, and possibly something positive will come out of this debate to make certain that the industry does not decline any further.

NORTON VILLIERS TRIUMPH
1.30 p.m.
Mr. Hal Miller: I welcome the presence of the Minister of State, who has been particularly concerned with the subject of this debate throughout his period of office and to whose knowledge and experience the House will certainly join me in paying tribute. I thank him very much for delaying his recess to be present on this occasion.
It is fitting that the House should have this opportunity of debating the effect of

2059
the Government's actions on Norton Villiers Triumph before rising for the recess. During recent months there has been a considerable state of uncertainty about the future of this great concern, and puzzlement has been occasioned to hon. Members by the sudden withdrawal of an order from the Order Paper.
I should make it plain that my interest in this matter arises solely from my specialisation on the Industry Committee of the Conservative Party, to which I have the honour to belong, and an approach by some of my constituents who are employed at Norton Villiers Triumph. I assure the Minister that I was completely unaware when I applied for this Adjournment debate that the management of NVT would be producing its historical summary this week.
I am also pleased to have this opportunity of engaging the Minister in a debate, because I hope that he will elucidate some Parliamentary Answers which —I will not say that they were inaccurate —have certainly appeared misleading.
I make no party political point in considering this matter. I have no intention of raising the merits or otherwise of public ownership, of workers' co-operatives or of industrial relations problems. My intention is to explore the effect of the Government's actions on NVT, because I consider this matter to be an important illustration for us all of what happens when the Government—my remarks are addressed to Governments of both parties —intervene in the economy to pursue other than strictly economic objectives. I hope to illustrate that, in pursuit of those objectives, the Government—I am trying to choose unprovocative words—sink to methods and measures which, by normal standards, would not be regarded as acceptable and frequently achieve results opposite to those that they originally intended.
I speak with some experience, having been a civil servant in a department dealing with commerce and industry, of which I was deputy director for some years, and understanding the pressures on civil servants and their attitude towards industrial questions and the development of policy.
I think that I should begin the main body of my remarks by giving a short account of why Norton Villiers Triumph was set up by a Conservative Government
2060
under Section 8 of the Industry Act to save or to safeguard for this country valuable motor cycle exports of 40 million dollars and to preserve a great body of skills and design knowledge, to say nothing of an enthusiastic and talented work force.
It is ironic that the stated intention at that time was to procure an early and lasting solution to the problems of the motor cycle industry. That arose because of the failure of that great concern, BSA, which, in the last year of its existence suffered a loss of about £4 million at its Meriden plant. That led in the autumn of 1972 to the initiative to set up Norton Villiers Triumph in which the Government would invest on a 50 per cent. basis—I am giving broad figures— with the injection of nearly £5 million to produce 60,000 motor cycles a year from two factories. The alternative considered at that time was for three factories with an investment of £30 million to £40 million, which, it was estimated, would take six years to come into profitability. An announcement was made in March 1973, and Norton Villiers Triumph came into being in July.
Consequent upon industrial disputes at Meriden—I am trying to choose my words carefully—and the institution of a blockade following the announcement of the proposal to close the factory over a period of about one year, a proposal about which the company had consulted the Department and taken advice on how it should conduct itself, the company's immediate reaction—we must bear in mind that the company had nearly £5 million of public money invested in it— was obviously to protect the money of its shareholders, including the Government, and to seek legal redress for this position. However, it was subjected by the then Conservative Minister to considerable pressure not to take legal action. Indeed, it is surprising to read of the Minister threatening the company quite openly and saying,
"It will be worse for you if you do."
That is an actual quotation from remarks addressed by the Minister to the company at that time. The hon. Gentleman is looking alarmed. That was a Conservative Minister. However, I have quotations from his right hon. Friend in very much the same sense.

2061
At the same time the Minister announced that he would take over the negotiations with the Meriden leaders. Indeed, he conducted those negotiations in the Department and, by so doing, gave an appearance of legality and status in the eyes of the public to those with whom he was negotiating. We should also bear in mind that the Minister was acting as a shareholder, although he was overruling the board which was attempting to represent the interests of all members of the company.
Therefore, to my mind there was a considerable departure from the standards of behaviour to be expected of Ministers, and we were entering an area of confusion about the operation of the Department, of shareholders, and of the board. It is partly for that reason that I have sought this debate.
I am running short of time, so I will move on to the Labour Government. There have been a number of misleading public announcements on the subject of this co-operative. I refer only to a Press release of 29th July issued by the Department setting out the proposal to make a grant to the co-operative and containing the phrase:
"under the present pattern of industrial organisation there has been a failure to recognise the interests of the labour force in running the business. This accounts for much of the friction between management and workers, and seriously reduces the ability of industry to achieve efficiency and productive capacity."
There is no evidence of such friction at Small Heath or Wolverhampton. I consider that to be a thoroughly misleading announcement, just as I do the replies to which I have referred that I was given in the House about whether conditions had been imposed on the National Research and Development Council's grant or on export credit guarantees. The information was distinctly misleading, bearing in mind that I had evidence in letters from the company, in a letter from the right hon. Gentleman, in a letter from a trade union and in depositions by my constituents—some of the shop stewards involved in the discussions—that the grant was withheld until an agreement had been reached on the establishment of the co-operative. Indeed, one of the shop stewards at that meeting used the words "This is blackmail ", to which the Secretary replied, he informs me, that that was
2062
not a word that he liked but that was the position.
Apart from these improper pressures, there have been considerable delays. The House needs only to reflect that NVT was set up in July 1973 and we are now approaching January 1975 to realise that that is so. We still have no solution. Two years of exports have been lost. From Meriden alone that would be nearly 35,000 machines a year, never mind from the rest of the Norton Villiers Triumph plants.
There have been changes in policy following the change of Government, but that makes it no better from the point of view of the company, the enterprise, the work force or the management. There have been changes between the three-factory and the two-factory ideas. We understand from an announcement in the newspapers today that the Government are once more considering going back to three factories and a larger measure of public ownership. I think that is now plan 8 in NVT's history.
The result of these changes, delays and administrative pressures on a company in which the public already own 50 per cent of the investment is a loss of £0·5 million on duplicating the tools blockaded at Meriden, and a loss of £1 million in interest charges on the assets of that factory, for which it received 33 inquiries from other firms willing to acquire the premises. The losses now amount to about £3 million in this company in which there is public money, and these losses have only just begun because the company is losing its exports over the next year and is unable to finance its production.
The lesson that I draw from this is that the Government must have regard to the means as well as to the ends. They must try to reach a decision with reasonable rapidity and adopt a consistent and continuing policy. We hear so much about accountability, yet the Government have recently been acting in contradiction of the advice of the Industrial Advisory Board and have not come to the House to explain their policy.
1.44 p.m.
Mr. John Stanley: The House will be grateful to my hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller)

2063
for giving us a belated opportunity to consider the situation at Norton Villiers Triumph and Meriden.
I shall be brief. I ask the Minister of State to take careful note of the fact that the House has been treated in an extraordinary way in the lack of information that has been made available to us about the Government's policy towards this industrial situation.
I believe I am right in saying that the last formal ministerial statement to the House was by way of a Written Answer on 29th July, since when there has been no statement of Government policy. All that we have had is a Notice of Motion on the Order Paper every week from the beginning of this Parliament to increase the amount of public money to be provided under Section 8 of the Industry Act by about £8 million. It must be one of the longest-running Notices of Motion before an opportunity is given to debate the motion, and it is significant that it is still staring us in the face during the last few hours before the Christmas Recess begins.
My hon. Friend highlighted one point with which we should like the Minister to deal. Is it still the Government's policy to try to pursue the three-factory solution, or do they accept the two-factory solution? What choice do the Government intend to make? The three-factory solution requires public expenditure of £30 million to £40 million, and it will take at least six years before there is any profitability from that investment.
The two-factory solution, on the other hand, requires expenditure of just under £5 million, which was made under the previous Conservative Government, and that was postulated on the basis that there would be profits by the end of year 2. There is a clear commercial choice, and we want to hear this afternoon what choice the Government propose to make.
1.46 p.m.
The Minister of State, Department of Industry (Mr. Eric Heffer): I first thank the hon. Member for Bromsgrove and Redditch (Mr. Miller) for being so kind as to talk about my industrial experience. It has not perhaps been on the managerial side, but at least it is recognised as having been fairly vast on the other
2064
side of the fence. It is a good thing if Ministers have some industrial experience, on whatever side of the fence they find themselves.
It is nice to hear an hon. Member express appreciation for my staying here when everybody else has gone, but that is also true of the hon. Gentleman. It is important that he has raised this matter and that we are having a debate about it.
The hon. Gentleman rightly said that the Government inherited this situation. If I may make a personal point, it is that a document issued by the company talks about my having chaired innumerable meetings. That is not true. I sat in at two meetings. The matter arrived, as it were, "plonk" on our desk. We realised that there was a difficult and longstanding problem that had to be solved, and we set our minds to endeavouring to solve it in the quickest possible way.
The hon. Gentleman drew attention to the fact that much of this took place under the previous Conservative administration. I am not prepared to enter into criticisms or make statements of any kind about what happened under the previous Tory Government, and certainly not about what Ministers may or may not have done, or what others may or may not have done. It would be wrong of me to say anything one way or the other because I was not there, nor was any other Labour Minister present at the discussions that took place at that time. All we have are the statements by people on both sides of the fence who were there.
I thought that there were difficult problems in the world until I met this one. Meetings seemed to go on and on. Information was given from all sides which Ministers who were trying to sort out the problem found it difficult to clarify. We have tried to do our best, and we finally came up with the three-factory solution. Even at this moment it could be accepted, but it has not been accepted. One problem is the understandable feeling among other workers that Meriden might affect their employment. We have been considering the situation in the light of the feeling of the work force in all three factories.
Mr. Stanley: I take it that that means that Government policy is a three-factory solution and that, therefore, they have

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accepted that there will be a substantial public sector capital injection, which will approximate to the previous estimate of £30 million to £40 million.
Mr. Heffer: The Government, after general discussion, proposed the support of the Meriden co-operative. We always said that there would have to be the fullest discussion with everyone concerned in Meriden, Small Heath and Wolverhamp-ton. My right hon. Friend met the other workers and found some disagreement among other sections. He met the CSEU this morning and received a statement agreed last Monday between the workers at all three factories with a view to resolving their differences. I should have been at the discussions had I not been at the House, but I am told that they were helpful. My right hon. Friend has agreed to let the CSEU have his formal comments on the statement as early as possible.
Mr. Hal Miller: Could the Minister give us an assurance that the Small Heath stewards in particular were completely reassured that Government backing for the three-factory system would not lead to a loss of employment at Small Heath or threaten the planned expansion of output there? They have been on short time for a long time.
Mr. Heffer: The Government are deeply concerned that we should have a viable motor cycle industry. It is regrettable, but our industry could be put in a small corner of the Japanese motor cycle industry. In the past, some time ago of course, we led the way, and we believe that we still can lead.
Mr. Hal Miller: This was one of the concerns that I did not have time to express. The shelving or conditioning, whichever word we are trying to use to be neutral, of the NRDC grant, originally by a Conservative Minister but continued by a Labour Minister, has led us into the grave danger of losing our technological design lead and not being able to keep the Japanese out of the big bike market. That is one of my great objections to the present situation.
Mr. Heffer: The fact that the grant was temporarily deferred or held back while the Meriden and other discussions went on in no way affects future development. We are trying to maintain a viable British
2066
industry. On the evidence given to us and the discussions that we have had, we believe that there can be a good, healthy industry with Small Heath, Wolverhampton and the Meriden cooperative. We believe—this is why we are discussing the position again with workers from the three factories, the unions, the NVT management and the cooperative—that a healthy and viable industry is possible.
It is regrettable that it has taken so long to solve this problem. The hon. Member for Tonbridge and Mailing (Mr. Stanley) made something of the fact that a motion had been on the Order Paper for a long time. We should have liked to solve the matter within two weeks of taking office, but there was a long history, which usually means that a long time afterwards is taken up in sorting the matter out and getting it right. We believe that we are working along the right lines, trying to solve the problem sensibly and intelligently.
I do not have time to deal with all the points raised; in fact, I have not dealt with any that I intended to mention. But anyone who wants to understand the complications should read the document issued by the company, which is interesting reading. We have not had time properly to study it and weigh it up, but there is no question that the matter has been complicated. We want to settle it as early as possible. I have a great deal of information that I should have liked to bring out but time and constant interruptions do not allow me to do so.
Mr. Stanley: Is it the Government's view that, in going for a viable motor cycle industry on a three-factory basis, public expenditure will be required of £30 million to £40 million, which is unlikely to show a profitable return for at least six years?
Mr. Heffer: The hon. Member must not try to draw me into accepting positions until all the discussions have taken place. The matter is still being discussed. Obviously, we cannot at this stage give any concrete answers to the points that the hon. Gentleman has raised. No one would know exactly how much finance would be required. All that I can say is that, based upon the discussions which have taken place this morning, moves are

2067
going ahead to try to get this matter resolved at the earliest moment.
I think that the hon. Member for Bromsgrove and Redditch said that we owned 50 per cent. of the shares in NVT. That is not true. We certainly have a shareholding in it, but not 50 per cent.

ISLE OF WIGHT FERRIES
2.0 p.m.
Mr. Stephen Ross: I am most grateful to you, Mr. Speaker, for giving me the opportunity today to raise a matter relating to the fare structure of the Isle of Wight ferries and the problems facing the commuters who use those ferries.
There is very considerable concern in my constituency about this matter. I believe that the crossing to the mainland is said to be the most expensive five miles of crossing anywhere in the world. That has been a long-standing grievance with us. But with the quite massive increases in recent months, we have every right to call upon the Department of the Environment to look more closely into the whole fare structure covering the ferry and other services linking the Isle of Wight with the mainland.
I deal first with the passenger ferries, and particularly the rates which the daily commuters are now having to face. I am sure that the Under-Secretary will be aware that the island has always suffered —as I suppose all islands are bound to suffer—from a higher unemployment rate compared with other parts of the South and the Midlands. I do not have the latest figures, as I gather that they are not being published this month and possibly not next month. But I seem to recall that the last time the figures were published they showed that unemployment was running at nearly 5 per cent. The rates rise in the winter months because we are in a seasonal holiday area, and quite a lot of the slack gets taken up in the summer.
Although it is true that we have managed to attract several new industries over the past 15 years—we are very grateful to previous Governments for their support in that and grateful to the firms which have come to what is a very pleasant environment—they have not, unfortunately, been able to absorb the very substantial number of the particularly
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skilled type of craftsmen who are very often trained in shipbuilding and aircraft techniques.
I remind the House of the very famous old shipbuilding company, John Samuel Whites, which unfortunately went out of business as a builder of ships—I think it was the oldest such company in Britain —in the mid-1950s. The company is still operating but it does not build ships now. Therefore, trained men, boiler-makers and others, now travel daily to Southampton, and some to Portsmouth, to work in the yards there.
Also, we were the home of Saunders Roe, which built flying boats. When those, unfortunately, finished on the scrap heap, the sort of experienced men employed there were not able to find jobs suitable to their crafts on the island. Others settled on the island during the Britten-Norman expansion for the "Islander" aircraft, but became redundant when that company had its financial troubles a year or so ago. Many of these people now have to travel to the mainland.
I estimate that about 2,000 people— mostly men and students—because much of the industry we have on the island employs female labour—travel to work daily on the mainland. Most of them go on the early boats to Portsmouth or Southampton. Others work at night or on day shifts at Lymington. There are three main routes to and from the mainland.
Another factor to be borne very much in mind is the lower wage structure which pertains on the island. I do not have any very up-to-date figures on this matter, but I have talked to the people concerned and I find that there is no question that in spite of the high cost of fares it still pays them to travel to the mainland to earn a higher wage than they would earn if they took a job on the island for which they were not fully skilled or a job which was below their capabilities. My guess is that the average wage is still something under £30 a week.
Most of those who travel daily to the mainland rise at about 6 a.m. Very often they do not get home before 7 p.m. During the recent election campaign I travelled over with many of them and we talked of their problems. I also travel with them sometimes when I come to the

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House. They all ask for action over the quite alarming number and size of increases in fares this year, and no doubt, with the recent fuel price increases, the fare increases to come.
I recently received a petition, containing 70 signatures, from regular users of the 8.5 a.m. boat from Ryde to Portsmouth. Three main commuter boats sail early in the morning, and that one is probably the least used of them. This has been commented upon in a letter from a Mr. Williams, of Bembridge, who puts the case so well that I should like to quote the most relevant extracts:
"Employment opportunities on the island are totally inadequate to cater for the number and the skills of the working population and consequently many residents are compelled to work on the mainland, in and around Portsmouth and Southampton. Since June 1974 there have been two major increases in British Rail ferry fares. A third increase of 12½ per cent. is promised in January or February 1975. We are fast reaching the ludicrous situation where many people will be unable to afford to work. Even the cheapest season ticket (an annual one) now costs over £100"—
I think that the latest figure for the Red Funnel is £10380—
"which means an individual must earn £150 or £3 a week before tax to cover this. It is even more expensive for most of us who are unable to afford an annual ticket, the current rates for shorter periods are: 3 months, £29·15, 1 month, £11·46, weekly £3·30."
The letter points out that
"Commuters in the London area are assisted in most cases by a special London allowance or higher pay to offset the extra cost of travelling and other higher expenses."
In addition, the ferry fare is not the only expense to island residents, as the majority have to park their cars at the end of the pier, which is a most expensive exercise. One of the few privileges of a Member of Parliament is that he is able to do this free.
It is the high cost for the short journey across the Solent which is causing the greatest concern and hardship. Some form of subsidy or concession is the only answer to this problem.
The petition ends:
"We, the undersigned, respectfully ask you to do all in your power to alleviate the situation."
Those figures relate to the British Rail operation to Portsmouth and Lymington. Red Funnel, whose structure is similar —the fares are almost exactly the same— operates between Cowes and Southampton
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and is increasing its fares from 1st January next to a single fare of 70p and a return of £1·40. Its annual season ticket will cost in excess of £100.
This service takes nearly an hour to make the crossing from Cowes to Southampton, while the British Rail routes, which cover the shorter crossings of about five miles, take a mere 25 minutes—yet the fares are similar. In fact, the cost of Red Funnel's annual season ticket was slightly lower until the latest increase was announced.
For those wishing to make a quick crossing by hovercraft, the situation is just as bad. A book of 80 tickets cost £40 a year ago. It now costs £52 and as from 29th December it will cost £64. This is an increase of over 50 per cent in just one year.
I turn quickly to the commercial side Factories and businesses on the island will, on the Red Funnel, have to cope with some very substantial rates as from 1st January. They range from £16 for a vehicle not exceeding 30 ft. overall and weighing 4 tonnes, to some £60 for vehicles exceeding 45 ft. overall. In addition, they have to pay—it has always been a sore point with people driving to the island—not only for the vehicle but for the driver and passengers. It is true that there is a concession for island-registered vehicles. We are grateful for that concession, which was granted some years ago. There are certain contract rates for regular lorry users.
I pay tribute to the operators, both British Railways and Red Funnel, for the way in which they manage to assist commercial users, particularly during peak holiday periods when pressure is intense. However, I fear that if rates continue to rise like this many firms when they come to make savings, which in present circumstances seem quite likely, will feel that the island is becoming too expensive a place for them to operate. That would be disastrous after all the hard work which has been put in to attract people to my constituency.
British Railways are not very forthcoming about the receipts from their operations to and from the island. In fact, when we were fighting the case to preserve our railways we had great difficulty in getting any breakdown of the figures. That is a story in itself and I

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recommend the Under-Secretary to read the story of the great Isle of Wight train robbery because it gives some interesting facts which have never been denied.
One thing is certain. British Railways do not make a loss on either their private or their commercial traffic. I suspect that they make a very handsome profit, particularly on the commercial side, although in fairness I should state that I have been told by the manager of the Ryde-Portsmouth steamers that that particular ferry service is only just back in the "black". No doubt this operation was affected by a very successful private enterprise concern—Hover Travel—which runs a hovercraft service from Portsmouth to Southsea and which consistently turns in significant profits. Perhaps some additional enterprise such as occurred with Western Ferries in the Clyde might be a very healthy tonic. Here I gather that British Railways fares have dropped substantially since that company went into operation.
I have taken these matters up with both operators and with the Under-Secretary by letters. The Under-Secretary replied to my letters. He confirmed that a substantial subsidy is paid at the moment under Section 39 of the Transport Act 1968 to keep the Ryde-Shanklin railway in operation. One of the greatest mistakes ever made was to cut that line off at Shanklin. It should have gone on to Ventnor, in which case there would have been no need to subsidise it, but that is another story. So it is a substantial sum which is being paid. The latest estimate is £228,000.
The Under-Secretary refuted my request for help to be extended to the ferry services. I suggest that perhaps British Railways would like to hand over the ferries between Ryde and Shanklin to private enterprise and then perhaps that £228,000 could be devoted to keeping the fares down.
As for roads, it has long been a matter of contention on the island that we have never benefited from the 100 per cent. grant for trunk roads, because trunk roads terminate on the mainland. We have no trunk roads on the island. For the principal roads which we have on the island we get a 75 per cent. grant. It has always been an argument in the past—
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things are changing next year—that the ferries were a continuation of the trunk roads on the mainland.
What about tax concessions on the cost of travel to work? Is not this another thing that the Minister might be prepared to consider and talk over with the Chancellor of the Exchequer? I know that this opens up wild spectres in other areas, but surely we on the island are a special case.
I ask the Minister seriously to consider what I have said—I have not had much time in which to put it over—and to look with greater sympathy on the claims of those who I am certain need help, because they are very deserving cases, but whose case I fear I have put very inadequately.
2.13 p.m.
The Under-Secretary of State for the Environment (Mr. Neil Carmichael): The hon. Member for Isle of Wight (Mr. Ross) was too modest when he said that he put the case inadequately. He put it most forcefully. The fact that he did not put it at greater length does not mean that the case was not put adequately and that it is not accepted as being worthy of consideration and an answer from the Government.
I congratulate the hon. Member on the forceful way he has raised the problems of his constituents. I accept that there are problems in relation to ferries. Indeed, such problems always arise when any change in mode of transport is involved.
As a Scot who is much concerned with transport matters, I am constantly reminded of problems of this nature— that is, the ferries—which my fellow Scots face in the outer communities which are dependent upon ferries for their links with the rest of the country. It is salutary to be reminded that there are also English communities which face the same difficulties.
However, although the Isle of Wight shares those problems with the Hebrides, the Orkneys, the Shetlands, and even the Isles of Scilly, we must not forget that the Isle of Wight enjoys certain other amenities. Unlike the other communities which I have mentioned, the Isle of Wight is part of South-East England. Even when the other communities have used their ferries and reached the mainland, they are still remote from the centres of

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economic and social activity. The Isle of Wight suffers the difficulties of an island community, but these are not of the same order as the problems of the constituents of the hon. Members for St. Ives (Mr. Nott) and for the Western Isles (Mr. Stewart) and of the right hon. Member for Orkney and Shetland (Mr. Grimond). I think the hon. Member for the Isle of Wight will accept that there is this obvious difference. It is against this background that we must consider the transport services which link the island to the mainland.
We are concerned basically with two operators—British Railways, which provide two vehicle and passenger ferries, one passenger-only ferry, and a hovercraft service, and the privately-owned Red Funnel Line, which provides another vehicle and passenger service and a hydrofoil link. Thus we do not have a situation where the nationalised industry has a monopoly, although the hon. Gentleman tended to suggest that there was such a close link on the fares that there was an understanding. I think that the understanding is almost certainly the commercial one that the operators are aware of, and probably watch very carefully, each other's services and fares.
Mr. Stephen Ross: The tickets are interchangeable. A ticket for the British Railways Ryde-Portsmouth service can be used on the Red Funnel service.
Mr. Carmichael: This is good commercial practice by both companies. I think the hon. Member will agree that the fares are not always exactly the same. Sometimes they are out of step.
The hon. Member mentioned the ferries on the Clyde. It may seem rather ridiculous since I use the ferries a lot, but I should need to check on this. I believe, however, that there is and always has been similarity in the fares charged on the ferry services from Gourock to Dunoon.
However, what we must look at in the case of the charges made by British Railways is the basis upon which Parliament has decided that British Railways should operate and provide a service. The Transport Act 1962 laid down a framework which required the British Railways Board in general to act commercially and charge prices which would ensure that, to
2074
use the jargon, taking one year with another the revenue was adequate to meet the costs properly chargeable to revenue. This is the standard basis upon which nationalised industries are expected to operate where there are no special factors.
In the case of railway passenger services Parliament has made special provision, most recently in the Railways Act of last Session. This ensures that where the Secretary of State requires passenger services to be provided the Railways Board receives compensation for the costs which it incurs in providing services which are not commercially justifiable. The important thing is that Parliament decides that these services shall be provided. Therefore, it is accepted that Parliament will provide the moneys to pay for any deficiency in these services.
These special arrangements have never been applied in general to the board's shipping services, because these services have not presented the same type of social problem as the railway passenger service. In Scotland there have been shipping services where special arrangements have been justified on social grounds, but the British Railways shipping services in the Solent have never encountered this type of difficulty. For this reason, there has been no cause to disturb the arrangement, settled by Parliament, whereby the level of the fares within the Government's general price policy has been a matter for the commercial judgment of the Railways Board. The fares structure on the British Railways ferries is, therefore, not a matter of direct ministerial responsibility. Nevertheless it is legitimate to look at the general problems posed by this question.
We must first look at the costs which affect the services. The House does not need me to tell it that there have been large price rises over the past two years. But there are some costs where those not in day-to-day contact may not appreciate the scale of the rise. For example, fuel costs are largely determined by factors outside the operators' control. For the hovercraft service, fuel costs have gone up by about three and a half times between 1973 and 1974.
In his Budget Statement my right hon. Friend the Chancellor of the Exchequer made it clear that part of his overall strategy for the economy would have to

2075
be the elimination of the support to nationalised industries which consisted of compensation for price restraint. I think that this to some extent deals with the problem which the hon. Gentleman raised—the possibility of my asking the Chancellor of the Exchequer to consider special tax concessions for travel. In other words, while there is no suggestion that there will not be subsidies for special and social needs, the Chancellor undertook in his Budget Statement to eliminate any subsidies which were intended to hold back prices; otherwise nationalised industries would get into a false situation.
The Chancellor recognised that it would be necessary to continue to help with expenditure which is necessary for primary social reasons, but he emphasised that where prices were being held far below their true cost it would be necessary to make price increases, in accordance with the Price Code, to rectify the situation. Equally it is necessary to ensure that where cost increases are occurring there is an appropriate increase to offset them. No users of the national transport services can regard themselves as being privileged to escape all cost increases.
How, then, does all this affect the case put forward by the hon. Gentleman? In the first place, all the increases which have been made, both on British Rail ferries, and on the hovercraft, have been vetted by the Price Commission in accordance with the Price Code. Secondly, there can be no complaint that commuters on this service are more harshly treated than commuters elsewhere in the South-East.
I agree that this may seem a bold dismissal of the hon. Gentleman's case, even allowing for London weighting, and I would point out that there are parts of the South-East where London weighting does not apply and costs are very high.
Mr. Stephen Ross: May I point out that people who travel to London enjoy a substantially higher wage structure? I do not think that the wage rates in the Portsmouth area bear any comparison with those in the South-East. The two do not compare.
Mr. Carmichael: I do not want to become involved in a discussion on London weighting, but many people who live on the periphery of London buy season
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tickets which cost them up to £250 and more a year. This is a matter which perhaps we can discuss in more detail later. But the purchase of a season ticket obviously makes travel cheaper, and the conditions which apply to travel between Portsmouth and Ryde are much the same as those which apply between Waterloo and Portsmouth. British Rail obviously wants a guaranteed usage of the line and it is willing to give concessions in order to get it.
Finally, while there have been three fare increases this year on the ferries, we must remember that these came after 14 months in which there had been no increases.
In the past the hon. Gentleman has argued that British Railways should have subsidised the passenger services from the profits made from the vehicle traffic. This is not the time to go into the pros and cons for cross-subsidisation in detail. I content myself with saying that while this practice may give some relief in the short term, it is not a system upon which we can build a sensible and permanent structure of finance for nationalised industries. Artificially low prices will stimulate demand, and the operator is then faced with a need to expand a loss-making service. This may enable him to put it on to a satisfactory basis, but where the low price is intended as a hidden subsidy it is more likely simply to result in a bigger loss. When it comes to replacing capital assets too, there is the problem that the loss-making service may make it impossible to justify reinvestment. Cross-subsidisation is not the answer, therefore, to any problems which there may be.
Another argument which the hon. Member for Isle of Wight has put forward is that there is a need for low-cost transport to the mainland for commuters, to ensure that workers who cannot find jobs on the island do not have to leave the island and thus worsen the imbalance in the age of the population. The hon. Gentleman has raised this matter in correspondence with me. I do not doubt that this is a serious consideration for the island and all who are concerned about its future. Neverthless, it is not in the first place a question for the Department.
The hon. Gentleman referred to Saunders Roe and other companies, but successive Governments have placed the prime responsibility for this kind of problem with local authorities, who have the

2077
necessary first-hand knowledge. The county council has a duty, as part of its planning function, to consider the transport requirements of its area. To deal with problems of this kind there has been the possibility of grants for rural ferries, and there is now the possibility of including support for ferry services in a county council's proposals for transport supplementary grant. In this way we have created a method whereby the county council, if it sees a need for support for the ferry services, can enable ferry operators to provide the services which it thinks necessary. If there is real concern in the Isle of Wight about this problem, this is the way by which it should be solved. The people on the island will have the benefit of transport supplementary grants.
To sum up, therefore, the level and structure of fares on the Solent services of British Rail are a matter for the commercial judgment of the management of British Rail within the Government's general policy on prices. The Chancellor has emphasised that general economic policy requires nationalised industries to increase their prices to meet increases in costs. The increases in fares on services on the Solent have been vetted by the Price Commission. There have been three fare increases in 18 months. Perhaps it would have been better had they been introduced in a more regular pattern. However, that is a matter for discussion at some other time.
Commuters on these services are no worse off than commuters on the railway system generally. Cross-subsidisation is no long-term answer to any problems which may exist. If there are any social problems for the island which mean that special treatment is needed, this is a problem in the first place for the county council, which can include any special measures in its proposals for transport supplementary grant.
The hon. Gentleman and certainly the local authority in the Isle of Wight are aware of the possible advantages which can be taken of the many schemes to help industry on the island. With the transport supplementary grant the local authority can build roads and a proper transport infrastructure to suit the requirements of any industry which it can entice on to the island.

WAGE STOP RULE
2.30 p.m.
Mr. Stanley Newens: I greatly appreciate the opportunity of raising the subject of the wage stop rule on this occasion, particularly as it has been a matter of controversy since its origin in the 1966 supplementary benefits legislation.
According to the rule, unless there are exceptional circumstances the amount of supplementary benefit payable to a claimant shall not exceed what would be his net weekly earnings if he were engaged in full-time work in his normal occupation. In other words, it means that if a man's earnings are less than the minimum established for benefit scales as laid down by the Supplementary Benefits Commission, the claimaint is liable to lose part of his entitlement to benefit. In other words, he is asked to exist—with his dependants, of course— at below the minimum acceptable standards. That is surely an appalling state of affairs.
We have a position in which the State is insisting on a certain category of claimants receiving less than the minimum income necessary, in the eyes of the Supplementary Benefits Commission, to maintain a reasonable standard of life. It means that there is considerable hardship for the small number of people affected. I think that only a small number of people are involved, normally not more than 10,000. Because of the rule, people have to go without certain essentials which are provided for other people in our community.
Families which are subjected to the effect of the wage stop are sometimes socially inadequate and therefore they are not expert planners. As a result, the burden is frequently not evenly shared within the family as a whole. Therefore, the full brunt of the sacrifice may be borne by the mother in the family or by the children.
The problem may be associated with other social problems. As a result, the wage stop rule makes circumstances in some families, which are already very bad, much worse. The wage stop rule, with associated circumstances, may result in children going to school regularly without breakfast or the mother going

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without main meals. I know that the Under-Secretary of State for Health and Social Security has experience of teaching in the part of London where I gained my experience. He knows that it is not unknown for children to come to school without have had breakfast.
It may again mean that children will return in the evening to unsatisfactory homes where there may be no space heating or electric light. The family may be incurring debts all the time without the possibility of clearing them.
A few years ago I came across a family in which there were five children. When, as a result of a misdemeanour, I investigated the circumstances, I found that those children had to go from school in the evening to a home in which the electricity had been cut off for the previous six weeks, which meant that they were completely without any form of heat or lighting at home. How is it possible for us to expect that children from such families will do well at school?
Consider, for example, some of the other difficulties which they may encounter. Schools will naturally provide that during the course of the week children will have to do physical education and play games in the normal course of events. In most cases the local education authorities and the Supplementary Benefits Commission will not supply children with games kit or physical education kit. The result is that when a child comes to school he finds that he is unable to participate in games. He is often pressed as to why he is not able to provide himself with the kit, and in many cases he plays truant and consequently begins on a course which will considerably undermine his education and his general reliability in the community at large. In such a family the lack of food, the debts, the worry and the pressure from debt collectors can bring mental breakdown as well as unhappiness in many other respects.
I am aware that there are possibilities for wage stop families to claim extra allowances, but I wish to point out that there are difficulties in this. In the first place, as I understand it, the commission's confidential instructions in the A code advise officers normally to reject the use of the discretionary power. Secondly, even if allowances are provided they do
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not necessarily bring families up to the minimum standards laid down by the Supplementary Benefits Commission.
Thirdly, there are frequently delays while all the ramifications of the possible situation are investigated, and during the period of the delay the family situation continues to deteriorate. In many cases where the allowances are not claimed families do not understand whether they have any entitlement or not. That fact is not difficult to grasp because even the most intelligent and knowledgeable people often find it extremely difficult to grasp whether the allowances are to be paid when the regulations are so complicated, as in this case.
Working out the allowances to which a wage stop family is entitled means, therefore, a disproportionate burden on the staff. Far more calculations are involved, there is considerable need to consult other departments and there is also the need to make home visits, which I understand are supposed to be carried out at intervals of not less than 13 weeks, but frequently the period between visits is much longer. Many offices are under considerable pressure to find people with the expertise to make the necessary calculations and carry out the visits. There is quite an amount of evidence now available that the staff in the offices will not be able to keep pace with the necessities of providing for these families.
I understand from the answer to a Question I asked on 26th November that the total savings involved as a result of the wage stop rule amount to less than £1 million per annum but that the costs of administration could not be calculated. I suggest that if the costs were calculated we should find that they amounted to a considerable proportion of the savings made. In fact, if the savings were compared with the costs, in terms of officials' time, and subsequent payments made by local government and national Government departments were deducted, we might find that the savings were negligible.
If there is a saving, is it justified? I realise that the commission's aim in this case is not to force idlers to work. I realise that that is not the basis of the argument for the retention of the rule. It is extremely important that people who are able to work should be found jobs

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so that they may go to work and help to support themselves. That is important from many different points of view. But we are often dealing with people who unfortunately are unable to find jobs and who may never be able to go to work again.
I understand that the aim of the commission basically is to avoid the iniquity of a man at work earning less than his unemployed counterpart is drawing in national assistance. But the existence of what I call starvation wages is no justification for starvation allowances. Something has to be done about wages, and it is no use reducing the allowances until it is done. I believe that we ought to do something to see that the situation is brought to an end at an early stage. The effect is to penalise those who frequently are less able to defend themselves.
One problem is in determining what is a claimant's normal occupation. There are many cases of disabled or sick men who previously had skilled jobs in which they earned considerable incomes but who, as a result of disablement or sickness, are classed as labourers. Frequently there is no allowance for overtime which they might be able to work. The result is that the normal earnings for which they are assessed fall to a low level at which they become eligible for the application of the wage stop rule.
Frequently many of those affected have children. Some figures which I have seen show that 60 per cent. of wage-stopped families have five or more children. It means that the real burden frequently is imposed upon the children, who are unable to stand up for themselves. It seems to me totally unsatisfactory that we should allow this state of affairs to continue.
The Child Poverty Action Group has campaigned against this rule from its inception. Tony Lynes did this in the past and more recently Frank Field and Laurie Elks, who is the author of a pamphlet showing what are the disadvantages of the system in detail. I am indebted to Mr. Elks for opening my eyes even more to the results of this iniquitous rule.
The Child Poverty Action Group has assessed a great volume of material and experience. Many of the cases which
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it has investigated are heart-rending. All are cases in which the people concerned were not able to help themselves.
I do not believe that a Labour Government should perpetuate poverty, which is what is happening in these cases. In any event, I believe that poverty has its own cost in terms of the creation of apathetic, alienated and inadequate citizens whose cost to the community in the long run may be very much greater than would be the cost of paying the families in which they are brought up a reasonable minimum allowance.
I am deeply aware of the problems of the present economic crisis. I am very well aware of the pressures from the Treasury which my hon. Friend will have to face. I am also aware of the attitude of some commentators in the Press who are prepared to write off as idlers these unfortunate people who are subject to this rule. That is totally unacceptable to those of us who are involved in the Labour movement.
I do not regard the Supplementary Benefits Commission as the main enemy. In many cases it has tried to do its best to alleviate the rule. As long as the rule exists, however, there will continue to be a number of people in our midst who are very badly treated.
I believe that the wage stop rule should be abolished forthwith, and I hope that my hon. Friend will be able to make some announcement on this issue today. I can assure him that many of us who feel deeply for those afflicted by it will continue our campaign until the rule is wiped out and these people get reasonable consideration from the State, which at present they are not receiving.
2.45 p.m.
The Under-Secretary of State for Health and Social Security (Mr. Alec Jones): I am very grateful to my hon. Friend the Member for Harlow (Mr. Newens) for giving this House the opportunity to discuss this important subject of the wage stop.
It is a convention of this House on these occasions for Ministers to pay tribute to the hon. Member who raises such a subject. On this occasion it is more than a convention. The concern that my hon. Friend has expressed today and on many previous occasions is one that is shared by me. Both of us are

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deeply concerned to abolish poverty wherever it is to be found, and, therefore, it is a personal pleasure to me to reply to this debate.
My right hon. Friend the Secretary of State is always anxious that all aspects of social security shall be subjected to the closest scrutiny and criticism of this House, especially those sensitive areas of which we know the wage stop to be one. There can be very few hon. Members who are unaware of the problems and the effect of the wage stop on families. I represent a constituency which has a too long history of high and long lasting unemployment, which inevitably leads to the exercise of the wage stop rule.
For that reason, I say at the outset of my remarks that we are aware of the major problems. If we were not aware of them from our own experience, we would soon become aware of them from our reading of the publications of the Child Poverty Action Group. We are indebted to the people whom my hon. Friend mentioned. Even my Department has provided itself with the book on the wage stop written by Laurie Elks.
As my hon. Friend knows only too well, the wage stop results from the fact that the take-home pay of some people when they are at work is less than the amount of their requirements by supplementary benefits standards. It is inevitable that decisions which limit the supplementary benefit payable to amounts below the levels approved by Parliament are not only unpopular but at times controversial. These decisions which have to be taken by the officers of the Supplementary Benefits Commission stem from the duty laid on the commission by statute. Since the commission is the object of much criticism for keeping people to a standard of living below the minimum that Parliament has prescribed, it is only right and fair to emphasise that in applying the wage stop the commission is applying the law for which we in this House are responsible. I know that my hon. Friend is aware of that, but sometimes it is too easy to criticise other bodies when the responsibility is our own.
My hon. Friend realises also that there is no easy answer to the problem. To pay a man who is not working more than he receives when he is working seems mani-
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festly unfair to large numbers of our people. I think that we would be unwise to ignore the resentment which that causes particularly to those who are working on particularly low wages irrespective of the rights or wrongs. We would be unwise to pretend that those at work on very low wages would not see it as unfair if we did otherwise
The answer to the problem, as most of us have come increasingly to realise, lies ultimately not in reducing the benefit of the family which is living on supplementary benefit, but in increasing the income of men at work.
Mr. Newens: Hear, hear.
Mr. Jones: I know that my hon. Friend has played, and continues to play, a large part in that campaign. The best solution to the problem surely lies in improved earnings for the lower paid and better measures of family support.
Criticism is often directed at the commission and its officers. I suppose that, in view of the number of cases which the commission and its officers have to deal with, some criticism is inevitable. With the sheer size of the task because of the duties this House puts upon them, it is inevitable that mistakes will occur from time to time. Judgments requiring the wisdom of Solomon may have to be taken, and I do not suppose that any member of the staff can guarantee to have such widsom every time he makes a judgment.
Here, as in so many aspects of their administration, the commission and its officers are open to attack on both sides —on the one side, for being too generous, which has been suggested on numerous occasions by the Opposition, and on the other side, including by my hon. Friends, for being too niggardly. The commission is in no way complacent about the wage stop and the difficulties it produces, both for the claimant whose income is cut by the operation of the rule and that the difficulties that it throws on the hard-worked staff itself.
This is instanced by the fact that the commission chose the wage stop as the subject of its first special report as far back as 1967. The commission has been, and remains, only too aware of public concern about the effect of the rule on poor families. One of the advantages of

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having people like my hon. Friend campaigning and of having booklets published of the sort that he mentioned is that they constantly draw these facts to our attention. But the commission has been concerned about the situation for some time. In its special report it described the wage stop as
"a harsh reflection of the fact that there are many men in work living on incomes below the supplementary benefit standard."
Given this fact, there can be no easy or painless way of administering the wage stop.
In some respects, we accept that we should be doing more to help. My hon. Friend referred to the need for visiting wage stop families regularly. He suggested, rightly, that we are unable to fulfil what he regards as our reasonable obligations in this matter. Of course, we are unable to do it, because we had to concentrate so much effort on uprating benefits and other urgent tasks, which have taken up so much of the time of those who would carry out such visits. In the last 12 months we have placed an intolerable burden on the staffs of local offices, which is having the effect of making it much more difficult to carry out such visits. Many of the criticisms arise also because of the intrinsic difficulty of judgments to be made by local officers.
My hon. Friend referred to the possibility of a person who might be considered handicapped, and the difficulties there. This is a considerable problem. One of the judgments which have to be made is deciding whether a man is so handicapped in one way or another that he is virtually unemployable. To remove the wage stop from him may be seen as a signal by him that he is now on the scrap heap. By doing that, in such circumstances whilst we should be relieving him of the wage stop on his actual benefit, at the same time, we should be depriving him of his hope of re-establishing himself as a working member of the community.
Yet another difficult area of decision and judgment for the commission and its officers is determining the potential earnings of a claimant. Again, all the difficulties raised by my hon. Friend are well known. Where there is clear evidence of a man's recent earnings, this figure can be taken. Such evidence, however, is frequently not available, and, as my hon.
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Friend knows, the commission bases its estimate on likely earnings for about three-quarters of all wage-stopped claims on the rates of pay negotiated for labourers by the National Joint Council for Local Authority Services.
I am glad to be able to tell the House that the agreement recently concluded provides for an increase of about £3 in the basic rate, which will result in an appreciable drop in the number of claimants whose supplementary benefit is wage-stopped. This fall in numbers is the continuation of a welcome trend. The numbers have been falling considerably over the past years. In November 1970 there were as many as 34,000 wage stop cases. In November 1974 the number was below 8,000. This reduction has been brought about by the use of the national joint council rates, which now amount to over £30 at basic rates, and more in London, by general increases in wages and by improved family support.
The rent and rate rebate systems and the increases which we made through the family income supplement rates in July have all helped, and so, too, will the increases in family allowances to be introduced in April. As a result of these developments, we expect that even when supplementary benefit rates are increased next April the numbers wage-stopped will decline to perhaps as few as half the present number.
My hon. Friend suggested that exceptional needs payments were not payable in these cases. I am not suggesting that everything is perfect there, but I am assured that such payments can be made, and are made. I am speaking generally, but I would not like it to go on record that no exceptional needs payments are made for these people.
The real attack on the wage stop is to render it unnecessary by increasing the earnings of the lower paid and improving the measures of family support. The Government's proposals to help the low paid and other families in poverty by introducing a new system of child cash allowance for every child, including the first, should reduce the numbers of the wage-stopped to vanishing point.
The Government will continue to keep the matter under review, and if, as a result of the other measures we are taking, the numbers fall to a very low level, we certainly do not rule out the possibility of

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abolishing the wage stop. In the meantime, the commission will continue its unremitting efforts to administer this difficult provision of the law as fairly and as sympathetically as possible.
The Government and the Department are fully aware of the difficulties which the wage stop creates. We are concerned about it, as is my hon. Friend. When I use the words "keep under review", I assure my hon. Friend that I mean them absolutely literally.

GLASSHOUSE INDUSTRY
2.59 p.m.
Mr. Michael Marshall: I should like to begin with a few words of thanks.
I express my thanks to the Chair, through you, Mr. Deputy Speaker, for selecting this topic for debate. It is a particular pleasure for me to see you in your place. Nine months ago, when I mads my maiden speech, I had the opportunity of referring to the fact that over one-tenth of the glasshouses in the country lie in my constituency, west of Chichester and east of Worthing, and I told you, Mr. Deputy Speaker, that in my constituency we have the largest glasshouse producers of flowers and vegetables. Therefore, this is a very important constituency matter.
I express my thanks to my hon. Friend the Member for Blackpool, South (Mr. Blaker), who is Chairman of my party's Horticulture Committee, for being here to represent the wider interests and reflect the feeling, which goes across party lines, about the problems which face the glasshouse industry.
I extend a welcome to the Minister. I am glad that he has been able to spare time to answer this debate. I am not at this stage prepared to offer him thanks. I shall first await the answer he gives to the points which I raise. I am also glad to welcome my hon. Friend the Member for Chichester (Mr. Nelson), who has travelled to the House specially to support me as a neighbouring Member.
Although I have a strong constituency interest, I wish to raise problems which apply to the glasshouse industry generally. There are three main problems which affect the industry. I shall touch briefly on the first two. They will come as no
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surprise to the Minister. The first concerns inflation. In this context, inflation means a massive cash flow crisis.
At a time of price restraint and increased foreign competition, the figures given at the national glasshouse energy conference in October this year showed starkly the problems of rising costs for the industry. Labour costs have increased by 50 per cent. in the last two years. Fuel costs have increased 100 per cent., fertiliser costs by 65 per cent. and packaging costs by 60 per cent. These figures mean that there is a dramatic increase in the need for working capital to maintain the same level of business. This is happening at a time of high interest rates and poor prospects of raising capital on the market.
The second main problem arises from Government action. I do not intend to be contentious, but it is fair and, indeed, reasonable to point at the obvious factors. In recent months payments of advance corporation tax and legislation have put the squeeze on the glasshouse industry and on small businesses. There is particular concern that the increased national insurance contributions for self-employed people will hit very hard many small businesses and, in some cases, privately-owned businesses.
I have touched briefly on those two broad areas because I realise that the Minister cannot be expected to resolve such massive issues today. I therefore turn to the heart of what I wish to say.
I seek the views of the Minister and the Government on the energy crisis as it affects the glasshouse industry. We urgently seek the Minister's assistance. I refer specifically to the oil subsidy, which is due to be discontinued on 31st December if the Government maintain their present line.
There are three aspects on which I want to touch in appealing directly to the Minister to re-think this matter and accept the case for continuing the oil subsidy until at least 30th June 1975. First there is the competitive and subsidy situation in the European Economic Community. Without getting sidetracked into a debate on the EEC, it is right that I should declare that I am a firm supporter of Britain's EEC membership. But, whatever view one takes, we are members of the EEC and we must consider the facts as they are in the EEC.

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Let me turn immediately to the competitive situation and the way in which other EEC countries are treated by their Governments in the matter of oil subsidy. Eire is seeking a similar extension to that for which we are asking. Belgium already has a subsidy in force until 31st March. Denmark announced a package in November which included State guarantees for bank credits and a subsidy on interest payments. France has already said that subsidies are to continue until June 1975. Germany has earmarked 25 million deutschemarks in the budget for the glasshouse industry in 1975. Most significantly, Holland, the most important of our competitors, has in two ways great competitive advantage over us. The oil subsidy is to continue for Dutch growers in 1975, and for the 80 per cent. of Dutch growers who have the built-in advantage of natural gas, special gas prices have been approved recently by the Dutch Government.
Moving to the second main area of the problem, we have to look at the prospects of future EEC co-operation. That is why I am particularly concerned about the date of 30th June 1975. The growers in this country and in the rest of Europe have shown a refreshing willingness to get together in trying to agree a system which breaks away from the widely varying forms of Government subsidy. For that reason I welcome the acceptance by Mr. Lardinois of the principle that subsidies might continue until 30th June 1975. I do not intend to deal in detail with problems within the EEC and within the negotiations which the glasshouse industry has had with Mr. Lardinois, but the basic fact is clear-cut. Subsidies are acceptable until June next year.
There seem to be prospects for a reasonable rundown from that situation and of agreement between the growers thereafter. We know about the progressive proposals which have already been put to the EEC, and I believe that those further negotiations augur well for reasonable stability in the industry after the middle of next year.
Thirdly, I ask the House to consider the implications if the Government are unwilling to continue the subsidy after the end of the year. Let us get it into perspective. We are talking about £7 million over the whole of 1974. Against that must be set the glasshouse industry's pro-
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duction, according to the latest figures which are available over the last full year, of £70 million, which would be dramatically reduced if the subsidy were discontinued.
Some companies are already in severe financial difficulty, and I know that the Minister is aware of that. No doubt same would go out of business, but those which remain would inevitably be forced to cut down on their energy consumption, and that would have critical results in a highly seasonal business.
Mr. Anthony Nelson: I thank my hon. Friend for bringing to the attention of the House this important question which affects my constituency as well as his. Will my hon. Friend mention the land settlement associations which are so important in the Chichester area? They operate on a small tenancy basis and, because their business is more specialised, they will be especially hard hit if the Government are unwilling to see reason on the question of subsidies. Will my hon. Friend also refer to the consequences of a particularly bad winter? A bad winter will cost my growers about £1,000 per acre of glass more.
Mr. Marshall: I agree very much with what my hon. Friend the Member for Chichester said. Since he made the first point so succinctly, I do not think I need develop it.
He mentioned the problems arising for the industry resulting from a bad winter, and that is the very point to which I am addressing myself. If we get slower growth and later ripening, growers will miss the spring markets for both flowers and vegetables. The effect on vegetables will be dramatic. Out of a figure of £70 million for glasshouse production in the last full year for which I have figures, some £25 million comprises tomatoes, £15 million cucumbers, and £25 million mushrooms. If our growers miss the early spring market for tomatoes, they will allow the Dutch, who are their main competitors, to move in, and this will have great disadvantages for our industry.
Surely at a time when we are being urged to produce more food to save foreign exchange, a continuing oil subsidy is money well spent. I appeal to the Minister to think again on this matter. I have tried to show the difficulties which

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the industry will face over EEC competition since many EEC members continue to receive subsidies from their Governments. But, more seriously, the jobs of 135,000 people will be directly affected if the industry goes bust. Many more people will be affected in ancillary industries, many of whom have built up a substantial amount of capital investment.
I emphasise the question of capital investment because the Government bear special responsibility. It was a Labour Government in the mid-'sixlies who adopted the course that cheap oil was to be the energy source for the future. I accept that successive Governments since that time have implemented that basic decision in subsidising £100 million of capital investment in the United Kingdom under the horticultural improvement schemes. I seek to make no party point on this matter for I am sure that the country is in a position to obtain a reasonable return on that major investment.
The Minister will be aware that in today's issue of the Grower it has been estimated "on the highest authority", to use that publication's term, Government Ministers have managed to extract £3 million from a reluctant Treasury to provide a continuing subsidy next year. I hope that the Minister will be able to help us on that matter and will be able to give the House the facts in regard to the situation I have described. If he can give the House that information, I assure him that the continuation of subsidy will be fully justified. Therefore, since we are so near Christmas, I hope that he will be able to make that happy announcement this afternoon.
3.14 p.m.
Mr. Peter Blaker: The House is grateful to my hon. Friend the Member for Arundel (Mr. Marshall) for raising this important subject of the glasshouse industry. I am also grateful to him for allowing me the opportunity to take a few minutes of his time to put a few points to the Government.
The problem outlined by my hon. Friend is not confined to West Sussex but is nation-wide. I refer to the urgent problem of the industry's energy requirements. A motion on this subject in my name has attracted the signatures of 70 hon. Members, mostly from the Conserva-
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tive Party but some from two other parties in the House. So far, however, the Government have shown no willingness to extend the subsidy beyond the end of this year to next June. That is the period to which my remarks will related. I do not press the Government to say what will happen after June because consultations are taking place in the EEC on that topic, and I appreciate that it is too early to expect the Government to say anything about the situation, but the time is long overdue when the Government should be able to say something about what will happen after the end of this month.
The glasshouse industry is full of gloom about its ability to survive. That is true not only of the big firms but of the little firms. The industry's anxiety has been increased by the recent increase in the cost of oil. My hon. Friend has given the facts clearly, and they have also been given to the Ministry by the National Farmers' Union.
I recognise that any proposal for extra public spending these days must be looked at with great care. But the industry has invested £100 million since 1960 and has a turnover worth £70 million a year. The danger is that if nothing is done about the period until next June, many people in the industry will go out of business. That will mean higher prices and extra imports. All that is needed is about £3 million or £4 million, to be compared with the £500 million that the Government are now spending on food subsidies. Comparing those two figures, it is starkly clear that that would be £3 million or £4 million well spent.
I recognise that the Government must consult the EEC, but bearing in mind that the money would come from United Kingdom Government funds I cannot believe that if the Government put their shoulder into the effort they would find difficulty in persuading the EEC to agree to the subsidy continuing until June.
The last time that a debate on this subject was initiated from this side of the House—by myself earlier in the year— the Minister responded by announcing the subsidy that is now about to end. I hope that the Minister of State, whom I am glad to see here today, will be able to do the same again by announcing a subsidy from January until June.
3.16 p.m.
The Minister of State for Agriculture, Fisheries and Food (Mr. E. S. Bishop): I am pleased to reply to the debate initiated by the hon. Member for Arundel (Mr. Marshall) and also to take note of the comments made by his hon. Friends the Members for Blackpool, South (Mr. Blaker) and Chichester (Mr. Nelson). I assure the hon. Gentlemen that their observations will be taken into account. Whether they will be satisfied with the reply that I shall give depends on what I have to say, but I assure them that their points are very much in the minds of my right hon. Friend and the Government at this time.
I should not like the hon. Member for Arundel to think for one moment that we are unaware of the problems he has described and are not concerned about them. The importance of the West Sussex area and the rest of the South Coast as a centre of the glasshouse industry is well known. Indeed, the hon. Gentleman made a point about the significance of the contribution from that area, which accounts for about one-seventh of the glasshouse acreage of England and Wales.
With significant help from the Government, growers in the area and elsewhere have invested considerable sums in modern glass in the past few years. It is understandable that they should be concerned about the increases in their costs, especially those due to higher fuel prices.
The fuel subsidy, to which the hon. Gentlemen have referred, which we announced last April to help glasshouse growers, provides evidence that this concern is shared by the Government. In a situation where fuel prices rose sharply and unexpectedly after growers had decided upon and begun their cropping programme for 1974—it is significant that the growers had planned and begun their programme when these increased costs came in—the Government stepped in and announced a subsidy worth £7 million over the year to cushion growers against sudden increases. That was greatly welcomed by the industry and by others. It made a significant contribution to lessening some of the problems then facing them.
Although at the time other member States of the EEC announced that they
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would provide help, my right hon. Friend was quick off the mark with his firm and specific announcement, and the first instalment of the subsidy from 1st July was made retroactive to 1st January. The hon. Member for Arundel said that the subsidies in the other countries concerned were continuing much later than ours. Some of those countries started later than we did. We were quick off the mark.
While the introduction of the subsidy was welcomed by the farmers' unions and the industry at the time, concern has subsequently been expressed about aid after this month. This has culminated in proposals by EEC producers' organisations for a degressive subsidy payable over six years. The Commission did not accept these proposals, and we cannot accept that glasshouse growers alone among users of energy should be protected against the impact of higher fuel costs until the end of the decade. I am sure the hon. Gentleman will accept the logic of this situation, but I ask him to restrain himself for a little longer because I am merely making an observation on the effect of higher energy and fuel costs on all industries, and not on only one.
The subsidy that we provided was designed only to provide a breathing space during which growers could decide how best to adjust to the higher oil prices which, in common with other users of fuel oil, they will need to face in the future. I emphasise here that to provide long-term subsidies, as we are being invited to do, would create a situation that was altogether artificial and one that would militate against economies in the use of fuel.
I think we have to fit this situation into the wider context of high energy costs anyway and the need for economy. My right hon. Friend the Chancellor of the Exchequer has made it clear that, despite the difficulties, we must adjust to a pattern of high cost energy, and the sooner the better. This is unfortunate but it is a situation that has to be faced. This advice must apply to the glasshouse industry as to industry generally.
Having said that, I go on to assure the House that the Government are considering the subsidy position, and in this context my right hon. Friend will take into account the observations which have been made today.

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It has been implied that the willingness of the Commission to extend its guidelines on national aids for fuel oil should determine our decision, but I do not necessarily agree. Our original decision to introduce a subsidy and its announcement pre-dated the guidelines, and our decision on the future of the subsidy will be taken on the basis of national considerations within the context of any wider guidelines that are drawn, but it is a fact that the guidelines will not necessarily determine the position.
I think I have dealt with the subsidy point and given the assurance that we are actively considering the matter.
The hon. Member for Arundel referred to a quotation from the Grower. There is no basis for the Press statement that he has seen. My right hon. Friend is still considering the position.
Mr. Michael Marshall: I understand what the hon. Gentleman has said, but will he confirm that if there is clear-cut evidence that other countries in the EEC are continuing subsidies beyond the 12-month period—I know about staggered dates—the Government will seek to match any subsidisation beyond the 12-month period?
Mr. Bishop: The Government will take all aspects into account. They will consider the economic position of this country and the system in the EEC. I am saying that regardless of the willingness of the EEC to give approval to a continuation of the subsidy we shall have to consider our national position. It is difficult to compare aids in different countries, because they have some aspects and special problems which we do not experience, and we have our own national characteristics which will have to be taken into account.
There are other aspects to bear in mind. I understand that many growers along the South Coast are achieving improved yields of glasshouse vegetable crops. The Ministry's Agricultural Development and Advisory Service—ADAS—gives advice to growers, for example, through articles in horticultural and other publications, on ways of making the most efficient use of heating in glasshouses, and grants are available for eligible improvements to this end.
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With regard to the activities of the Ministry itself in this respect, as might be expected greater emphasis is being given in the agricultural research programme both at the Ministry's experimental stations and in the ARC-sponsored research to using energy more efficiently.
The Engineering and Buildings Board of the Joint Consultative Organisation on Research and Development in Agriculture and Food has been considering ways of making better use of energy sources in the long term. Among the areas being considered are the utilisation of wind power, solar power, waste heat from nuclear power stations and the production of methane gas from animal waste. Savings through better insulation of farm buildings and better use of farm machinery are also being considered. It is expected that the JCO report will be produced in due course.
An ADAS committee has been considering also the practical measures that farmers can take to save energy in the short term. The advice incorporates results of the research programme and is available to farmers through ADAS. A hand-out was made available at the Royal Show entitled "Focus on Fuel—How to Save Fuel". There have been other ways of passing on the advice from the Ministry.
Glasshouse production consumes a major part of the oil used in agriculture and the producers have been particularly hard hit by the rise in oil prices. I can accept what hon. Members have said about that. A national glasshouse energy conference attended by 700 or 800 growers was, as has been said, held in Little-hampton in October, largely on the Ministry's initiative, to discuss ways of saving fuel. There have also been regional meetings in Yorkshire, Lancashire, East Anglia and the West Country.
It is important to bear in mind that, apart from wanting more financial help by way of a possible fuel subsidy or in other ways, the industry should do all it can, with the Ministry's help, to use energy more effectively.
Mr. Nelson: I was privileged to attend that dinner at Littlehampton. Would the Minister accept—this may be regarded as a political point, but it is very real—the strong feeling of growers in our part of

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the world against the Government handing out over £600 million in indiscriminate food subsidies while shirking giving to the West Sussex growers the much more needed and direct help of barely £3½ million, to keep them going at least into the middle of next year?
Mr. Bishop: The hon. Member claims that food subsidies are indiscriminate whereas the help that he advocates would be specific. Nevertheless, food subsidies help to keep down the level of cost-of-living rises which have been pushing us through the thresholds and increasing inflation, which has harmed glasshouse growers as well as other people.
Mr. Michael Marshall Mr. Michael Marshall rose—
Mr. Nelson Mr. Nelson rose—
Mr. Deputy Speaker (Mr. George Thomas): Order. We cannot have everyone on his feet. To whom is the Minister giving way?
Mr. Bishop: The hon. Member for Arundel (Mr. Marshall).
Mr. Marshall: We have so little time, and I want to be clear about the subsidy. Is the Minister saying that a decision has not been finally reached? That is somewhat different to Oral and Written Answers that have been given. Can he say that the matter is still under consideration?
Mr. Bishop: A decision has not been reached in so far as all the processes for agreement have not been completed. What I have said, and I can say no more, is that the matter is very much under consideration. I should not want to go further than that.
However, I assure hon. Members that the Government are very much aware of the industry's problems. In some ways the West Sussex industry is probably in one of the most favoured climatic areas and is well placed for the main London markets. Its market is the entire United Kingdom. It has the facilities which make for efficiency and it is well supported by the ancillary services which have helped to make it economic much more easily than many other areas. I think also, however, that we should not overlook the help given by the Horticul-
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ture Improvement Scheme and in other ways.
I want to assure hon. Members that I appreciate the observations they have made today, that their comments will be considered with those of the industry generally and that we shall certainly take them into account in coming to a decision as to the future of the oil subsidy or any other financial help which may be borne in mind.

BEARSTED MEMORIAL HOSPITAL
3.30 p.m.
Mr. David Weitzman: I am grateful to have the opportunity of raising on the Floor of the House the matter of the threatened closure of the Bearsted Memorial Hospital. This is the only Jewish maternity hospital in England. It deals with 800 to 1,000 births a year, a considerable percentage being non-Jewish cases, but its main object is to serve the needs of the Jewish population in the centre of a Jewish community.
The hospital had its humble beginnings in the East End of London. The present site in Stoke Newington was acquired and plans were made in 1937, but it was not until October 1945, because of the war, that permission was given to enable part of the hospital—for 32 beds—to be erected. Very considerable sums of money were raised by the Jewish community. A large amount came from the pennies of Jews in the East End of London, and substantial support was provided by Lord Bearsted and his family. An annex was opened at Hampton Court to meet the need pending the completion of the hospital in Stoke Newington.
The hospital was taken over under the National Health Service. On 25th July 1952 the Minister gave an undertaking that it would be extended and that the annex would be closed down. On 25th February 1954 I raised the matter in the House. That undertaking was then reaffirmed. It was said to be part of a long-term project. Twenty-two years have pased since 1952, but that promise has not been kept and apparently it has now been abandoned. In 1969 the annex was closed.

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I want to remind the House of the legal position. Under Section 7(7) of the National Health Service Act 1946 regard must be had to the objects of the endowment. Under Section 61 of that Act, where the character and association of any voluntary hospital transferred to the Minister is such as to link it with any particular denomination, regard must be had to that in the general administration.
In defiance of these legal obligations, the Enfield and Haringey Area Health Authority has issued an order to close down the hospital at the end of this year. It has done this in the most disgracefully dictatorial fashion, at short notice and with no consultation of any kind. Notice of closure was given to the matron and staff on 27th November—five weeks ago. The Community Health Council was then informed and was assured that the individual staff had given their approval after full consultation and had accepted the need for the closure. That was untrue. I have seen them and I am satisfied that it was untrue. In fact, the consultant obstetrician of the hospital, when he heard of it, wrote in protest. The consultant staff were informed only on 9th December—ten days ago.
In a letter dated 11th December, the chairman of the Tottenham Hospitals Medical Staff forwarded to the Secretary of State two resolutions passed by the medical staff. They were as follows:
"1. This meeting deplores the decision of the Enfield and Haringey Area Health Authority to change the use of the Bearsted Memorial Hospital without any consultation with the consultant medical staff in the hospitals involved and finds the manner of the initiation totally unacceptable. The Area Health Committee is requested to halt the implementation of its decisions at once so that full discussions may take place.
2. This meeting believes that minority interests of the local Jewish community should take precedence over administrative convenience."
The Town Clerk of the London borough of Hackney wrote to the Secretary of State saying that he was instructed by his council to protest against the decision taken without consultation, that the area health authority could not be fully informed of the needs of residents of the borough, that the facilities of the maternity hospital were of unique value to the local Jewish community and that
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the loss of these facilities would have a serious detrimental effect on the local community.
There has been complete disregard by the authority of the circular issued by the Department. In Appendix 5(1) of Circular HRC(74)4 the relevant area health authority is told to consult community health councils about their plans and intentions. In paragraph 32 a duty is placed upon the authority to see that such councils in particular are advised and are consulted about the opening of a new service or, as in this case, the closure of an existing service. That was not done.
I attended a meeting of the area health authority last Monday. The reason given by the chairman for the closure was that the hospital could not continue without the tutor midwife and that the Central Midwives Board could no longer treat the hospital as a teaching unit. The truth of the matter is that in August last, and indeed at the beginning of the year, the authority knew that the tutor would be retiring in the middle of December. It had ample time to secure a replacement. It placed a badly-worded advertisement in the Nursing Mirror. It did not advertise in any other nursing journal or in any Jewish periodical. It told the matron in October last not to engage any further staff. In fact, without advertisement, applications for posts were received by the matron but she was under orders to refuse them.
Moreover I am reliably informed—this information has been conveyed to the chairman—that one agency can supply a State certificated midwife on 30th December and another one on 6th January and that another agency can provide an unlimited number of certificated midwives and nurses upon request from an official body. It is obvious that the reason put forward by the chairman is spurious and the hospital can continue and should continue fully equipped as it is today.
Perhaps the real reason for the proposed closure is that given by the district administrator on 28th November last. He then told the non-nursing staff that the reason was that there was a large surplus of maternity beds in the district because of the new maternity wing in the North Middlesex Hospital. Indeed, this excuse is reinforced by reports circulated in the constituency that it is the

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intention to replace Bearsted by a geriatric hospital or by a rehabilitation centre for juvenile offenders.
As the Town Clerk of the London borough of Hackney stated, Bearsted is of unique value to the local Jewish community. Not only this, but it serves the whole of the Jewish community in London. It is conducted in accordance with strict dietary laws. The Jewish mother has the attendance of the mohel for circumcision purposes. Jewish services can be held. The requirements of the Jewish holy days are observed. The attendance of the requisite 10 men to form what is called a minyan can be achieved in the present location.
The mere supply of kosher food from the kitchens of North Middlesex Hospital would be insufficient. North Middlesex is situated in a district where it would be impossible to hold Jewish services and, because of the walking distance, husbands and relatives would be unable to visit there on the Sabbath or on holy days.
I sent to the Minister a petition signed by over 2,000 local people protesting against the closure. I have received hundreds of letters from mothers in London, and particularly from my own constituency. The Board of Deputies of British Jews, the Chief Rabbi and the Jewish Chronicle have all protested in no uncertain terms. Over 50 Members have signed the motion I tabled protesting against this action.
If this hospital is closed it will inflict a severe blow on the Jewish community and will remove a well-needed service from the general community, because it is used, of course, to a considerable extent by the general community. It cannot be replaced by any transfer to the North Middlesex Hospital. I have heard it suggested that this hospital might be kept open in skeleton fashion and then its re-opening might be considered. Another report is that it will be open for three months. I hope that these reports are untrue. If the hospital is at any time reduced to a skeleton staff. I feel sure that it will never be reopened, and there is absolutely no reason why it should not continue as it is, serving the needs of the community.
I protest in particular as strongly as I can at the scandalous manner in which this decision was made. There was no
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consultation with the bodies or people who matter. There was, in my view, a manufactured ground to support an unjust proposal in order to fill the North Middlesex Hospital. There were broken promises with regard to Bearsted and there was a complete failure to recognise the need for and the importance of this hospital, situate where it is.
I ask the Minister to reject the manoeuvres—I use that word deliberately—of this area committee and to allow the hospital to remain open and to function fully. At the very least, I trust that if he cannot give me that assurance today he will at any rate say that no decision will be taken until there is the fullest possible consultation on this matter.
3.41 p.m.
The Under-Secretary of State for Health and Social Security (Mr. Alec Jones): I would not wish to join in a legal battle with my hon. and learned Friend the Member for Hackney, North and Stoke Newington (Mr. Weitzman) for obvious reasons. He has equipped himself throughout his life with far greater talent than I have in this field. I could not agree with the strong words which he used, though I understand his reasons for doing so.
I prefer to begin by quoting to my hon. and learned Friend a statement made in the House by our late friend and colleague, Dick Crossman. He said on 21st April 1969, referring to this hospital and its problems:
"I am not able yet to formulate precise proposals nor to indicate when and at which hospital these new facilities will be provided. But I will ensure that the North-East Metropolitan Region Hospital Board takes account of this undertaking in its future plans, so that a Bearsted wing is provided with the special facilities desired by the Jewish community."— [OFFICIAL REPORT, 21st April 1969; Vol. 782, c. 224.]
I assure my hon. and learned Friend that it is our intention to see that that undertaking, given in this House by a former Secretary of State, will be honoured.
May I now explain to my hon. and learned Friend why the threatened suspension of admissions to the Bearsted Memorial Hospital from 1st January has arisen? It is a primary duty of the statutory health authorities to have proper regard for the safety of the patients in their care. At the Bearsted Memorial

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Hospital a situation has arisen in which, through a crucial staff shortage, that safety which is dependent upon nursing care and supervision cannot be guaranteed. In consequence, the area health authority has had to make urgent contingency plans for the admission elsewhere of patients who were to have been accepted into the Bearsted Memorial Hospital after 31st December this year.
Mr. Weitzman Mr. Weitzman rose—
Mr. Jones: I shall give my hon. and learned Friend the latest position, news of which we received less than half-an-hour ago.
May I emphasise that there are two completely separate issues which I should like the House to recognise? The first issue is the likelihood of the immediate temporary suspension of admissions to the Bearsted Memorial Hospital due to an acute staff shortage. The second issue is that of the long-term future of this hospital in relation to the previous assurances given in this House to the Jewish community.
I should like to deal with the long-term future first so that this issue no longer confuses the question of a temporary suspension of admissions which may or may not take place. A survey was made in October of this year by the area team of officers of the Enfield and Haringey Area Health Authority of the maternity beds available in the two districts of the area. This survey showed very clearly that the area would be over-provided with maternity beds for the trends in population revealed by the statistics over the last few years. The maternity provision required for the area can readily be given from March 1975 by the two new maternity facilities at the district general hospitals in the area.
A paper was prepared on the findings of this survey and was to have been presented to the area health authority after consideration by the district management teams and the consultants for their comments. This paper was prepared and circulated for comment and in that paper change of use of the Bearsted Memorial Hospital was proposed. It was intended that the area health authority should consider the proposed change of use of the Bearsted Memorial Hospital after the
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informal discussions had been completed. Had the area health authority then agreed with the proposals, permission would have been sought from my right hon. Friend the Secretary of State to proceed with formal consultations with the community health councils, Jewish representatives and other interested bodies with a view to making proposals to the Secretary of State for her final decision. This formal pattern of consultation towards a final proposal has still to be made and has not been arbitrarily dispensed with by the area health authority, as seems to be the view of my hon. and learned Friend.
I now turn to the other and more immediate issue, which is the possibility of a temporary cessation of admissions to the Bearsted Memorial Hospital and the possibility that that might take place from 1st January in order to secure the safety of the patients.
The Bearsted Memorial Hospital is recognised by the Central Midwives Board as a teaching establishment for pupil midwives. It has an establishment of two tutors. The first of those tutors left earlier this year, and on 31st August the second tutor gave notice to leave at the end of the year. No fewer than 15 advertisements for replacement tutors have been placed in nursing journals since the beginning of the year, and no satisfactory applicant has yet been found. There is a shortage of midwifery tutors in this area. In direct consequence, in November the Central Midwives Board withdrew its recognition of the Bearsted Memorial Hospital as a teaching institution, so that, with effect from the withdrawal of the second tutor, which is due to take place on 31st December—
Mr. Weitzman Mr. Weitzman rose—
Mr. Jones: If I am not able to give my hon. and learned Friend all the information for which he has asked, he will have only himself to blame.
Mr. Weitzman: I hope my hon. Friend listened to my speech, because his suggestion that certificated midwives could not be obtained is absolutely untrue. I have quoted chapter and verse showing that they could have been obtained. The hospital finds itself in its present position because of delay and negligence, which I say is deliberate, on the part of the area board, in not making a proper

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attempt to recruit midwives. It can be done.
Mr. Jones: I understand my hon. and learned Friend's annoyance. However, the chapter and verse which he has given are not those on which I was advised. If there are differences on this matter, possibly we can discuss them later on. However, what I am saying is said in just as much good faith as that in which my hon. and learned Friend has expressed himself.
My hon. and learned Friend will appreciate that among the first to be made aware of a possible decision to close the hospital should be the staff, upon whose good will and morale so much depends. However, it was inevitable that this emergency decision should become public knowledge and should be interpreted by many as an arbitrary and authoritarian decision to close this Jewish hospital without any consultation, without due warning and without concern for any previous undertakings given in this House to the Jewish community.
These difficulties existed, certainly, and we have sought right up to the last moment today to overcome them in the best interests of my hon. and learned Friend's constituents and of the whole Jewish community of that area. It is because of our determination to ensure that the interests of the Jewish community are not forgotten that we pursued this matter at another meeting this morning.
Since the meeting of the area health authority on 25th November other meetings and discussions have taken place with representatives of the community health council, consultants of local hospitals and representatives of the Jewish community. Particularly as a result of representations made by my hon. and learned Friend, all efforts are still being made to avert this threatened temporary suspension of admissions to the Bearsted Memorial Hospital.
Urgent attempts are being made to recruit sufficient agency staff. An attempt is being made to find a suitable midwifery tutor through the Jewish community. Consideration has been given to the possibility of obtaining assistance from the North Middlesex Hospital by the provision of a tutor or staff. But there is a local shortage of midwifery tutors, and the North Middlesex Hospital is already
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below establishment. That means that no assistance can be obtained from that direction. However, appeals for help have been made to the area health authorities of the neighbouring areas of Camden and Islington and of the City and East London. Unfortunately, to date, neither authority has been able to assist with staff or with a tutor. Should sufficient staff be recruited—and I am told that a minimum of seven nurses is required to allow even a reduced service—the hospital will continue to admit patients or resume service should a temporary suspension have become necessary.
In the meantime, plans are being made for the welfare of Jewish patients in other hospitals. The occupancy of the Bearsted Memorial Hospital by Jewish patients was of the order of 18 per cent. of the total bed availability, so that only about six beds were occupied by Jewish patients at any one time. I am assured that the provision of kosher food from the Hospital Kosher Meals Service can be made to Jewish patients in any hospital in the region. The North Middlesex Hospital can provide facilities to allow ritual circumcision, and the provision of similar facilities at other local maternity hospitals is being considered.
I come now to the most important part of what I have to say. This morning at a meeting with Lord Fisher and representatives of the Board of Deputies of British Jews, my hon. Friend the Minister of State gave a firm undertaking that a decision to cease admission to the Bearsted hospital would be delayed as long as possible—in fact until Monday 23rd December—to allow the most thorough attempts to recruit staff to be made. In addition to the nine pupil mid-wives who must be withdrawn to continue their training elsewhere, the hospital is short of seven other nurses. I am told that seven nurses, all of whom must be midwives, would be required if a temporary closure were to be avoided and even a reduced service maintained.
At 3.15 this afternoon the position was that we had received promises from certain agencies which would give us a total of seven midwives, one staff nurse with part I midwifery, and two nursing auxiliaries. The situation therefore appears very much more promising than it was even when we met Lord Fisher and his colleagues this morning. Of course, these

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promises have not yet reached firm commitment.
My hon. Friend the Minister of State further assured the meeting that the hospital will be kept open at whatever level the staff recruitment will allow, and that no unnecessary limitation will be placed upon the services given while formal consultations are held. I believe that my hon. and learned Friend can be as assured as it is in my power to make it that we are taking the advice and guidance of Lord Fisher and his colleagues.
We have pursued the question of the vacancies; we have taken advice as to where suitable nurses might become available; and we have made the promise that, provided the level of staffing which I have mentioned materialises, the hospital, or at least some part of it, will be kept open—and kept open so as at least to allow a breathing space in which long-term plans can be devised with the cooperation of all the people in that area.
Mr. Weitzman: I am satisfied that my hon. Friend will do everything he can in this case, but he has not said a word about what I consider to be the most disgraceful aspect—the complete lack of consultation with the powers and bodies which ought to have been consulted.
Mr. Jones: We can argue at length about the degee of consultation that should take place, but I must remind my hon. and learned Friend in this context that the health authorities during the past year have been subjected to reorganisation on such a scale as to make consultation extremely difficult. It is my impression, from my reading of the situation, that the urgent problems facing the Jewish community in that area are such that we should now concern ourselves not so much with an argument about past consultation but with trying to keep open either the whole hospital or as much of it as we can. That is the order of priorities, and that is the nature of the undertaking which my hon. Friend the Minister of State gave this morning.
Mr. Walter Johnson: I beg to ask leave to withdraw the motion.
Motion, by leave, withdrawn.

EXPENDITURE COMMITTEE
Ordered,
That, notwithstanding the Order of the House on 18th November relating to nomination of Members of the Expenditure Committee, Mr. Robert McCrindle and Mr. Ralph Howell be discharged from the Committee and Mr. Ivan Lawrence and Mr. Nicholas Winterton be added to the Committee for the remainder of this Parliament:
Ordered,
That this Order be a Standing Order of the House.—[Mr. Walter Johnson.]
ADJOURNMENT
Motion made, and Question proposed. That this House do now adjourn.—[Mr. Walter Johnson.]

LONDON RAIL STUDY
4.0 p.m.
Sir George Young: I am grateful to the Minister for postponing the commencement of his Christmas holiday, or for leaving his office party early, in order to reply to this important Adjournment debate. I hope he will not think me uncharitable if I observe that it is he, and not a Minister of State for urban affairs, who will be at the Dispatch Box. In the last Parliament, debates on subjects concerning our cities received the special attention of the Minister of State at the Department of the Environment with specific responsibility for urban affairs.
In a debate on city planning which I initiated on 29th July, the Minister's former colleague, the hon. Member for Manchester, Openshaw (Mr. Morris), referred proudly to:
"the decision taken by my right hon. Friend the Prime Minister to recognise overtly, in government, that urban problems do exist and that they need to be looked at in the round, bringing together all of the interests concerned. He did this by creating the ministerial post which I occupy."—[OFFICIAL REPORT, 29th July 1974; Vol. 878, c. 330.]
What are those of us who represent city seats now to make of the Prime Minister's decision to abolish that important post some time in advance of the solutions of the problems it was set up to solve? I hope it is not in any way a demotion of the importance of urban affairs.

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I am particularly glad to have this opportunity of raising the issues in the London Rail study, which are not simply a transport matter, but are crucial and sensible planning of the capital as a whole.
When I was a member of the Greater London Council, I was partly responsible for setting up the Barren Committee. Also, I sent to the committee a paper I prepared on the integration of the two railway networks insofar as the London borough of Ealing is concerned. I am therefore delighted to renew my association with this matter.
I want to press the Minister on what he proposes to do about the recommendations in the study which affects his Department, some of which the report says are urgent. When the report was published, the Minister, in reply to an aptly-timed Parliamentary Question, said about the report:
"I believe it will lay a firm foundation for the planning and development of London's rail services. I shall study its recommendations with care, as I am sure the Greater London Council and the railway undertakings will also want to do."—[OFFICIAL REPORT, 28th November 1974; Vol. 882, c. 248.]
It was a thoroughly predictable and unexceptional response, so much so that the Press did not pay attention to it. I hope that today the hon. Gentleman will be more forthcoming and will reveal some of the thoughts of his Department on the document.
I start with some of the suggestions made at the end of the report. On the organisation side, the report makes a radical recommendation in paragraph 10.18. Having quite correctly identified the danger of having two capital-intensive railway systems, with different financial objectives and different investment and tariff policies in the same area, the committee
"proposed that a rail advisory committee for London be set up, under an independent chairman, to advise on major rail planning including a requirement to report periodically on railway investment and fares".
Does the Minister accept the dangers inherent in the present system described in the report? Will he now set up the advisory committee and announce the name of the chairman?
From the organisational recommendations, I turn to the programme of expenditure dealt with in Chapter 7. The Minister
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sets the limits to capital expenditure of both London Transport and British Rail, though the London Transport situation will change next year with the transport supplementary grants. Therefore, he will decide which of the three options set out in this chapter will be followed. Planning in London is a very slow and laborious process and to speed it up decisions on the future transport pattern are needed as soon as possible. There have been road plans for the last 10 years, but they have all been dropped. I do not wish to develop the arguments for or against them, but London cannot afford another 10 years spent dithering with plans for public transport and investment therein. Therefore, it is essential that the Minister should indicate at an early date which option it is to be, and he should be prepared to stick to it once he has made up his mind.
Still on the recommendations concerning finance, I turn to paragraph 6.10 which recommends that programmes modernising stations should have a high priority. In my own constituency, the British Rail stations are an absolute disgrace. South Acton station would have been turned down as a halt for Wells Fargo 150 years ago. Acton main line station has all the glamour of a bomb site. Acton Central is the sort of edifice one finds overgrown with ivy in a Victorian burial ground. Figures are included in the investment options on page 29 for modernising stations, and if the Minister would like to accompany me to the stations I have listed I am sure it will help him make up his mind in favour of this section of the programme.
As to the work of the study group on new lines, and the financial implications thereof, those of us who have had planning responsibilities on the Greater London Council—and I see the hon. Member for Newham, South (Mr. Spearing) hoping to catch your eye, Mr. Speaker—are particularly interested in the section on the Fleet line and the River line which can unlock the door to dockland and make it available for the residential development which the capital so desperately needs.
In paragraph 6.24 the report sets out the compelling reasons for proceeding with these lines, and in paragraph 6.26 refers to the urgency of the matter. In the light of the report, will the Minister

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give the go-ahead on stage 2 of the Fleet line from Strand to Fenchurch Street? Does he accept the suggestions of paragraph 6.25 for building the new Thames-mead and Dockland line "at as early a date as possible"?
The Government have rightly said that housing is one of the top priorities, and no hon. Member would dissent from that judgment. But it is necessary to have the infrastructure available for residential development, and these lines are an essential part of that infrastructure. To go back to what I said earlier, one cannot look at the report just as a transport matter. It is a strategic planning matter which affects housing in particular. If we are to make an impact on inner London's housing problem, this capital expenditure on railway lines is a must.
I want to refer briefly to Crossrail, which basically links up by tunnel the main British Rail terminals in the centre of London. On studying the alignment of Crossrail on map 8, I see that it has been chosen by the hon. Member for Fife, Central (Mr. Hamilton) as it goes through the gardens of Buckingham Palace. In view of the congestion occasioned by Her Majesty's most welcome hospitality at her garden parties, perhaps we might even have a station there.
The authorised version of map 8 is an imaginative proposal which would have been easier to implement had it been put forward 100 years ago. Paragraph 6.33 contains a recommendation that as a high priority a feasibility study should be undertaken to determine the practicability and costs of the scheme. Is that feasibility study now to be undertaken?
A further recommendation which concerns the Minister, this time wearing his planning hat, is that contained in paragraph 7.11. It concerns safeguarding the alignment for the Chelsea-Hackney line, Crossrail, and other schemes, from encroachment by other developments. Maps 6, 7 and 8 show the routes of the proposed lines. Will the Minister take the proposed routes into account when he considers planning applications for offices and other developments in London? What action does he propose to take if blight results from the publication of the routes?
I want now to look at two weaknesses in the report. First, the report is con-
2112
ducted in a financial vacuum. In paragraph 5.14 there is, I suspect, a complaint which is heavily disguised in the uncon-troversial garments which clothe reports such as these. The paragraph states:
"No official Government (or for that matter GLC) view is available (on the future level of capital investment) and we have therefore had to make our own unofficial assessment."
The assumptions made by the group are set out in paragraph 5.15, and they are very important:
"No switch in funds is assumed either between transport and other sectors of the economy or (and this is the crunch) between public transport and roads."
Does the Minister accept that assumption? Alternatively, does he agree that there is likely to be a shift of public investment from roads to public transport in London? That is what his political colleagues at County Hall are saying, and I think that it is what the Minister of Transport has been saying in the House. It is certainly what the Minister for Energy would like to see.
I believe that the group took an un-realistically low view of the capital resources available to public transport in the next 25 years. It follows from that that the group may have felt unnecessarily inhibited in the solutions it examined and recommended.
On the other side of Westminister Bridge much play is made about the amount of money saved by scrapping the ringways, but where has the money gone? It is not included in the report, because the assumptions preclude that. Have Londoners just been swindled out of their transport investment? Perhaps the Minister will help us to find the missing millions.
The second weakness in the report is the failure to recommend that British Rail lines wholly within London should be handed over to London Transport, or that the two networks should be more closely integrated. I appreciate that the study group had on it representatives of London Transport and British Rail, and that may have inhibited discussion on those lines. However, many of the difficulties dealt with in the report could be overcome if the non-radial British Rail lines wholly within London were passed over to London Transport together with, perhaps, those radial lines which terminate within the GLC area or just outside it.

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There are precedents for London Transport taking over tracks from British Rail—for example, the former LNER lines to High Street, Barnet, and to Epping and now incorporated in the Northern and Central lines respectively. I shall refer in a few moments to the Richmond-Broad Street line which is wholly within the GLC area and which crosses the London Transport network in several places. The transference of this line to London Transport; would be a first step to having an integrated network instead of a selection of different lines. There are many other lines—for example, Hol-born Viaduct to West Croydon, London Bridge to Crystal Palace, London Bridge to Denmark Hill—which serve the GLC area and which should come under the London Transport system of British Rail.
The nettle was not grasped in the report, and for that reason it is that much weaker. The question of integrating the two networks arises, and the report says:
"The interchange between rail services is of key importance because it turns London's railway from a collection of separate lines into a properly integrated system."
However, the logic of this has not been carried through in the report. The interchange proposals are inadequate. Without Part II of the report—which is not available although it has already been written—obviously the logic has gone wrong.
Perhaps I could illustrate this point of criticism. The Richmond to Broad Street line runs through my constituency and crosses the Central, District and Piccadilly lines. Yet at no intersection is there a station—which makes impossible for any interchange to take place, unless one is an international sprinter. Public transport in my constituency is the poorer because of this lack of choice in any interchange.
I sent to the group some imaginative, radical and well-thought-out proposals which would have alleviated the situation in my constituency, but that evidence appears to have been overlooked. Instead, the report has concentrated on capital investment on given lines and has ignored better utilisation of the present network. I am sure that the hon. Member for Newham, South as an ex-Member for Acton will develop that theme.
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I have asked the Minister a number of questions, and, although doubtless he has a copious brief before him, he might not be able to divulge all the answers. However, I hope that he will not tarry long and that the report will not be allowed to gather dust in some ministerial pigeonhole.
As for the broad financial proposals, as we approach 25th December perhaps I could ask the Minister to give Londoners a Christmas present. Perhaps he will accept in principle the financial implication of the report and give Londoners the assurance that funds will be made available to improve the system.
4.14 p.m.
Mr. Nigel Spearing: As a former Member for Acton I should like to congratulate the present Member for Ealing, Acton (Sir G. Young) on raising this important subject. I am glad to see a former member of the Transport and Planning Committee of the GLC raising these matters, and I am glad that he has seen the light in respect of public transport in London. I only wish that the rest of the Conservative Party were as enlightened five years ago so that the Greater London Development Plan would have incorporated the proposals that we have set out in our document.
The chairman of the panel paid tribute to the co-operation between London Transport and British Rail. I must tell the House that I did not notice this spirit on my excursions into the London Transport system. This has been one of the historic difficulties.
I disagree with the hon. Gentleman on the point he made about taking over lines of British Rail and giving them to London Transport. The important thing is that these lines are a part of British Rail network and of the freight system, although I agree that we require an integrated network for passengers. I hope that when the advisory council is set up it will deal with these matters. Ever since the days of Lord Ashfield and Sir Herbert Walker there has been a need for London Transport and the main line railways to have their heads knocked together, in terms of being accountable to London. I hope that the advisory body will be able to avoid the past situation.
I find the report lamentably thin. It contains no analysis of the present flows

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and patterns of London's rail transport network. Nor do I find the financial anlalysis particularly illuminating. It relates more to what the report calls "performance" than the costs and potential abilities of this magnificent network that could again become the life blood of movement in London.
The section on fares does not deal with the possibility of period fares, either for areas in London or for the whole area, where by paying a certain amount per month one could travel an unlimited distance at off-peak times and, perhaps with a premium, at peak periods as well. Therefore, the report is thinner than it ought to be considering the time that it has been in the making.
The hon. Member for Ealing, Acton mentioned interchange. There is a particularly striking example in Newham, South. In West Ham, the electrified District line—electrified from about 1904—crosses the North Woolwich-Stratford line of British Rail, but not in the same way as at Acton, where there is difficulty in terms of distance. Physically above that line there is a station on the District line, but there has never been a station at Manor Road, West Ham, on the North Woolwich line. It is impossible to interchange.
These lines have been publicly owned for nearly 30 years. Fifty years ago it would have been in the mutual interests of both railways to put an extra station on the ex Great Eastern line, but that was not done. It was not done for bureaucratic reasons, although it was in the interests of the public.
I am glad that the Eastern Region is now looking into that matter. I understand that it will consider my representations about putting an interchange there, because that would give the residents of Silvertown, North Woolwich and Canning Town an easy means of access to Stratford and thence on to the major rail networks of London.
The most disappointing thing that I have found about the report is its dismissal of the ring-rail concept, to which the hon. Gentleman referred. It deals with a scheme which would have the highest traffic benefits and puts a high capital cost on it. There may be more modest schemes, of which we do not
2116
know because we have not got volume 2, which would give immediate benefits at lower cost. None of the alternatives of lower cost schemes given in the study contains a cross-river link. I believe that, interesting though the cross-rail proposals are, the cross-river link is most important for London, possibly on an orbital service from Acton all the way round to Hackney and across the river into Lewisham from the southern part of my constituency. That would open the area in the way that some people wish, without the questionable advantage of opening up the Thames line straight into the West End, as the report proposes.
I believe that dockland and dockland redevelopment should be for people who live there and for East London. A rapid transport scheme using existing lines would serve East London better than an expensive new tube giving direct access to the West End.
On reorganisation, I have said that we need the co-operation of existing agencies to give the best service to Londoners in both physical and cost terms. There was a pooled fare system until 1938. That has not been resuscitated, despite the fact that public ownership has come for both networks in the meantime.
As the last back-bench speaker before Christmas, may I wish you, Mr. Deputy Speaker, and the staff of the House the very best of the season. We look forward to seeing you refreshed for our labours in January.
4.19 p.m.
The Under-Secretary of State for the Environment (Mr. Neil Carmichael): With your permission, Mr. Deputy Speaker, and that of the House, I should like to attempt to reply to the points made by the hon. Member for Ealing, Acton (Sir G. Young) and my hon. Friend the Member for Newham, South (Mr. Spearing). I have never had the honour of representing Acton, but obviously they were raising matters of great importance to their constituents.
The state of public transport in London is a matter on which the majority of the capital's inhabitants quite rightly have strong opinions. As I travel around the country I find that the question of transport and public transport in particular, is one on which nearly every citizen has strong views. We are, therefore, well

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aware of the increasing importance of public transport.
The report of the London Rail Study is an important contribution towards setting the future shape and role of London's railway system. I should therefore like to echo the thanks that have already been expressed by my right hon. Friend the Minister for Transport to the members of the study team and in particular to the study's chairman, Sir David Barran.
Understandably it is the study's recommendations on capital investment that have attracted the most attention. The hon. Member for Acton asked whether the Government accept the financial implications of those recommendations. I think he knows as well as I do how public expenditure is dealt with. He must realise that the study's report has appeared too late to influence the Government's conclusions for the immediate future which will be set out in the forthcoming White Paper. The Government will have to take account of the recommendations in their consideration of public expenditure next year, though I cannot at this stage predict with what result.
Neither can any Government commit their successors to expenditure stretching as far ahead as 25 years. What is certainly clear is that the study, in linking its three levels of investment to the base of capital expenditure on London's railways forecast for the present financial year, has anchored the options firmly to a realistic starting point.
The hon. Gentleman wonders whether the report goes far enough in proposing integration of the London Transport and British Railways networks. My hon. Friend made a point on this, and I know that both he and the hon. Gentleman gave evidence and made submissions to the study. I understand that the study considered this question in considerable detail and that its views will be explained more fully in Part II of its report. The first report was published on 27th November, just under a month ago, and I think it is a little early to expect my right hon. Friend to have formed views upon it. There is still a great deal of information to be obtained from the public and others, and what has been said today will be taken into account. Improvements
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that were needed could be dealt with within the existing organisational framework of London Transport.
I think I can best illustrate the kind of problems involved by reference to proposals which the hon. Gentleman and my hon. Friend submitted to the study on the Acton area. As with the many other suggestions made to it, the study examined the proposals fully even if it was not possible to deal with them all individually in its report.
The hon. Gentleman had three proposals: the transfer of the present British Rail Broad Street-Richmond service to London transport, a new tube line between North Acton and Ealing Broadway and a series of improvements to stations and interchanges in the Acton area. I shall deal with them in that order.
But even if a high level of service were justified there is not the track capacity on the North London Line for it. The route forms the main freight link between West, North and East London. Because of their slower speeds, freight trains need an average of two and a half times the track capacity of passenger trains when the two interwork. Moreover the route suffers from two severe physical limitations—numerous flat junctions, which produce conflicting train movements and thus reduce track capacity, and the Hampstead Tunnel, which is so narrow that trains cannot pass through it in opposite directions at the same time.
The second proposal, for a new tube line between North Acton and Ealing Broadway, falls on similar grounds. In neither of these cases is the ownership and operation of the line a real problem. Incidentally, I should add that in cases where the study thought that lack of integration was a real problem—for instance, on the service between Queen's Park and Watford—it had no hesitation in recommending changes to remedy this.
However, the study recognised that there could be a case for improvement of this and other non-radial British Rail services in North London. It recommended as a high priority that British Rail should consider whether it could make them more attractive and accessible to the public. It also recommended that further study should be made of the costs, operational feasibility and likely demand

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for a high-cost improvement to these services, involving electrification, re-signalling, the reconstruction of Hampstead Tunnel, new stations and improved interchanges. This would result in a marked improvement over present services on the North London Line and through Acton main line station.
Third, the hon. Gentleman suggested that the study did not give sufficient thought to interchanges. In fact, I understand that it looked at a large number of places where interchanges might be improved or new stations provided. It rejected many of them, either because it was physically impossible to improve them or because the benefits to traffic could not conceivably justify the cost. Again I can illustrate the problems with two of the hon. Gentleman's own proposals, North Acton and South Acton. Both would involve moving existing stations and constructing new ones. In itself this would be expensive—very expensive indeed at North Acton, where it would probably involve rebuilding a viaduct on the British Railways line. His suggestions would also make the stations more inconvenient for the existing catchment areas and unlikely to attract much new traffic. Is the cost justified by the potential interchange traffic? The study—this is a value judgment to some extent —thought not.
Nevertheless the study fully recognised the importance of good interchange. It recommended a continuing programme of improvements and made some suggestions for first priorities. It is better to make a start with some such improvements than to spend an enormous amount of time in a review of all the possibilities. Some of the hon. Gentleman's suggestions will need to be considered in the context of the study of improved non-radial services which I have already mentioned. Incidentally, both the study and I entirely agree that signposting of stations leaves much to be desired and it is suggested that this ought to be improved as a matter of priority.
The hon. Gentleman was worried about the possible divergence of London Transport's and British Rail's investment and pricing policies. This was a problem of which the study was well aware, but
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it rejected a complete reorganisation of transport responsibilities in London. As my hon. Friend the Member for Newham, South (Mr. Spearing) said, sometimes when something goes wrong it is thought that a reorganisation of management structure will change everything, but I think we all realise that this matter is much more fundamental than that. Reorganisation carries with it the penalty of disruption while the changes take effect, and I would remind hon. Members that there was indeed a reorganisation in 1969 which has taken a considerable time to settle down.
So far I have been dealing with transport issues, but the study found that inevitably it had to go wider than this. It was not invited to replan London, and it did not attempt to do so. Equally, however, there were points at which its work became closely related to other topics. It tried not to avoid the implications of this. I think an illustration will serve to make the point.
The illustration is the proposal for a new Underground line through Dockland to Thamesmead, the "River Line". The report states quite clearly that the line cannot be justified either on financial grounds or on a conventional social cost-benefit assessment of its transport effects. But it also says that there are strong arguments on general planning grounds for the line and a strong case for providing it at as early a date as possible because of its beneficial effect on Dockland development. It also stressed the need in such cases for the integration of the physical and transport planning processes to produce the optimum overall result.
I will keep my concluding remarks short. The objects of the study were to shape the capital investment programme for the short and medium terms to provide the guidelines for medium-and long-term investment, as seen in the light of present circumstances, and to expose the basic problems facing rail transport in London, which is to decide how much finance should be available for both capital and operating expenditure, and the level of service to be provided. I shall write to the hon. Member about any other points with which I have not had time to deal.

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This is the last Adjournment debate before the recess. I and the Officers of the House have been here many evenings but have seldom finished as early as this. Perhaps I may have the privilege, Mr. Clerks and Officers of the House and all the staff a Merry Christmas and, coming Deputy Speaker, of wishing you, the from my part of the world, a Happy New Year.
Mr. Deputy Speaker: I am obliged to the Minister and to the hon. Member. I hope that we come back in the same spirit as we are leaving.
Question put and agreed to.
Adjourned accordingly at twenty-nine minutes past Four o'clock till Monday 13th January, pursuant to the resolution of the House yesterday.

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