Sitting of 5 November 1974

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS

  COMMITTEE OF SELECTION
  Ordered,
  That Standing Order 109 (Appointment of Committee of Selection) be repealed and that a new Standing Order be made as follows:—
  'There shall be a Committee, to be called the Committee of Selection, consisting of nine Members, of whom three shall be a quorum: and every Private Bill on committal shall stand referred to the Committee'.—[Mr. Walter Harrison.]
  Ordered,
  That Mr. Ronald Brown, Mr. Hugh Delargy, Mr. Reginald Eyre, Mr. Philip Holland, Mr. Adam Hunter, Mr. Cledwyn Hughes, Mr. Bryant Godman Irvine, Mr. Kenneth Lewis, and Mr. Frederick Willey be members of the Committee of Selection.
  Ordered,
  That the members of the Committee of Selection nominated this day shall continue to be members of the Committee for the remainder of this Parliament.
  Ordered,
  That this Order be a Standing Order of the House.—[Mr. Walter Harrison.]

ORAL ANSWERS TO QUESTIONS
  EMPLOYMENT

    Local Employment Committees
    Mr. Goldingasked the Secretary of State for Employment if he will take steps to accord suitable recognition to those who have served on local employment committees.
    The Under-Secretary of State for Employment (Mr. John Fraser): My right hon. Friend wrote personally to chairmen of local employment committees in July to thank them for their services and those of local employment committee members.
    Mr. Golding: Is my hon. Friend aware that there was great disappointment in Newcastle-under-Lyme on the part of the trades council and the local employment committee as a result of their being disbanded? Would not my suggestion be the best form of recognition of their service to ensure a continuation of their work in some form?
    Mr. Fraser: I am aware of the correspondence concerning this and I am grateful for the assistance which local employment committees provide. The Manpower Services Commission will shortly be setting up new district manpower committees and I hope that they will be able to obtain the services of those who have served well on local employment committees.

    Pay Settlements
    Mr. Madelasked the Secretary of State for Employment if he will make available the assistance of his Department for improving the consultation between the TUC and individual unions concerning the TUC guidelines on increases in incomes; and if he will make a statement.
    The Minister of State, Department of Employment (Mr. Albert Booth): The hon. Gentleman misunderstands both the nature of the advisory services of my Department and the rôle of the TUC towards its member unions. The General Council of the TUC has made provision for consultation with individual unions

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    as set out in paragraph 34 of its document "Collective Bargaining and the Social Contract". It would not be appropriate for me to intervene in the internal affairs of outside organisations.
    Mr. Madel: Would the hon. Gentleman agree that, if the 12-month guideline on pay increases continues to be breached, employers in the private and public sector will be placed in a very difficult position? Should not his Department hold a series of meetings to remind employers and unions that if the 12-month guideline is breached it will have a serious effect on the country's economy?
    Mr. Booth: There have been breaches of the 12-month guideline in both the private and public sectors mainly to remove some of the anomalies and imbalances produced by two years of statutory wage control. There is a provision in the TUC guidelines requiring unions which find difficulties in honouring this guideline to consult the TUC. We are, of course, in consultation with the TUC on any broad problem arising from the implementation of this part of the social contract.
    Mr. Skinner: Does my hon. Friend agree that free collective bargaining is free collective bargaining and that the Government would do well to understand that it would be better for them, despite the panic noises we hear from the Tory benches and from some other quarters, to keep at arm's length in the negotiations that take place daily between trade unions and employers? Would he further agree that in that way we can restore the free collective bargaining for which we all campaigned in the election?
    Mr. Booth: The Government recognise that day-to-day settlements in industry are the responsibility of negotiators on the employers' and trade union sides. We expect that these negotiations will take place against a background increasingly influenced by the carrying through of the social contract obligations which the Government have accepted.
    Mr. Prior: So that the country can judge the effectiveness of the so-called social contract, may I ask the Government to publish in the OFFICIAL REPORT the details of every settlement, the time between each settlement and the previous one, and whether in the Government's
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    estimation the settlement comes within the social contract? Is the hon. Gentleman aware that at the moment no none, inside the House or outside it, believes a single word that the Government say?
    Mr. Booth: The Government are not aware of every settlement that takes place. Some employers might think it an unwarrantable intrusion if we asked them to report on every settlement that took place. The Government accept a direct responsibility for settlements in the public sector. In this area we make available to Members who require it information about the terms of the settlements.
    Mr. Adleyasked the Secretary of State for Employment what advice he will tender to employers and employees who, after free collective bargaining, reach an agreement which he deduces to be in breach of the social contract.
    The Secretary of State for Employment (Mr. Michael Foot): One of the purposes of the social contract has been to restore free collective bargaining. In this situation it is not the function of the Government to issue specific advice about the conduct of individual negotiations, but we certainly urge that trade unions and employers should respect the guidelines for negotiation accepted by the TUC.
    Mr. Adley: When the guidelines are put before the House I am sure that we shall all enjoy looking at them. Is it not a fact, however, that the social contract is not stopping inflation? Although the Secretary of State may be a great parliamentarian, he also has a responsibility in his present position to help to stop inflation. Therefore, now that the election is over, will he stop playing games and get down with employers and employees to taking positive steps to bring inflation under control?
    Mr. Foot: The guidelines proposed by the TUC General Council, which were the subject of discussions in this House at the end of July at the time of the abolition of the Pay Board, were subsequently approved by the TUC. They have not been submitted to this House for approval but they have played a considerable part in the debate on this topic. I do not believe that any legitimate criticism can be made about the fact that we have not discussed these matters in this House. As

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    for seeking to combat inflation, the Government are passionately eager to do all we can to assist towards that end. That is one reason why we support the guidelines. If the guidelines are persistently breached, the prospect of overcoming inflation will be greatly injured. These are matters which, I am sure the hon. Gentleman will appreciate, are perhaps more fitted for general discussion in the debate which is to follow today and in the other debates which will follow the introduction of the Budget.
    Mr. Tugendhat: How does the right hon. Gentleman reconcile that answer with the answer he gave to my right hon. Friend the Member for Lowestoft (Mr. Prior) who asked about Mr. Scargill and Mr. Gormley? The union apparently reached agreement in the morning, the vote went the other way in the afternoon, and then the Secretary of State for Industry appealed to the miners to respect the future of the industry. Surely this, above all, is a matter in which the right hon. Gentleman, wearing a National Union of Mineworkers' badge in his lapel, ought to feel constrained to throw his weight behind the Government's efforts.
    Mr. Foot: I am extremely proud to wear the miners' badge in my lapel. I was sent to the House of Commons partly by miners, and I hope that I shall never forget that.
    I am certainly eager that everything possible should be done to encourage success in the mining industry. That is why the Government have put forward far-reaching proposals for the industry which I believe will be welcomed more and more by miners throughout the country the more widely they are understood. I believe that as they are understood we shall secure more effective support for the social contract, which was also carried at the last miners' conference.

    Picketing
    Mr. Blakerasked the Secretary of State for Employment if he will make a statement on his intentions regarding the law on picketing.
    Mr. Stanleyasked the Secretary of State for Employment whether he will be seeking to amend the law on picketing.
    Mr. Churchillasked the Secretary of State for Employment what plans the
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    Government have for amending the law on picketing.
    Mr. Foot: Discussions on this matter are still continuing.
    Mr. Blaker: Does the right hon. Gentleman propose to put forward legislation which will enable pickets to compel people to stop on the Queen's highway?
    Mr. William Hamilton: Farmers.
    Mr. Blaker: If he does that, is he aware that it will be met with strenuous opposition?
    Mr. Foot: The hon. Gentleman may recall that he had some discussions on this question when the previous legislation was going through the House. We said then that the matter would be dealt with in our Employment Protection Bill when it came forward. There will be ample time for the House to debate our proposals when that happens.
    Mr. Ashton: What is the use of bringing in new picketing laws when the Conspiracy and Protection of Property Act 1875, on which the Shrewsbury pickets were convicted, still exists? Is it not outrageous that ancient laws like this can be used against trade unionists going about their legitimate business?
    Mr. Foot: I know that there is strong feeling about the application of the 1875 Act, but that is a matter for my right hon. Friend the Home Secretary.
    Mr. Stanley: As the Secretary of State in his statement of 22nd March said that he would be considering introducing regulations governing the exercise of the right of peaceful picketing, may I ask whether he is considering making regulations prescribing the maximum number of people who can picket at one place at one time?
    Mr. Foot: That is an aspect that we shall consider, as we promised, when we have the discussions. It is a matter that needs careful consideration. That is what we said and that is what we are giving to it. When the matter is brought to the House, the House w ill be able to judge and vote upon it.
    Mr. Flannery: Will my right hon. Friend convey to his right hon. Friend the Home Secretary that this afternoon there is a strike and planned march by

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    workpeople on behalf of the Shrewsbury pickets, and that such action is likely to snowball throughout the country in the near future until we have a situation similar to that which occurred with the five dockers in Pentonville? Will my right hon. Friend exert whatever pressure he can to see that these unjust sentences are not simply mitigated but that a free pardon is given to the men, whom many people believe to be innocent?
    Mr. Foot: As I said in reply to a previous supplementary question, that is a matter for the Home Secretary. I am sure he will take into account all representations that are made to him.
    Mr. Churchill: Will the right hon. Gentleman give the House an undertaking that any legislation he may have in mind on this subject will in no way infringe the right of the individual employee and the individual trade unionist to attend his place of work free of the fear of intimidation?
    Mr. Foot: I would not answer the question in the form in which the hon. Gentleman puts it—[HON. MEMBERS: "Why not?"]—because I think it would be misleading. We are very much concerned with protecting civil liberties in this matter, and I only wish that some Opposition Members showed equal concern.
    Sir D. Walker-Smith: Whatever changes are made in the law, will the right hon. Gentleman be astute to see that the basic principle of our picketing law, as recently reaffirmed in the Broome case, is maintained—namely, that a picket may invite a person to stop for the purposes of peaceful persuasion but may not stop or detain him against his will?
    Mr. Foot: The right hon. and learned Gentleman has put that question to me before—that does not make the question any worse—and I have replied to him before that Government supporters cannot accept that the wisest legislative provisions are always those that may be the outcome of judicial decisions, because that is not what our history seems to sustain. Therefore, we shall consider that judgment along with the other matters when we are seeking to establish the right of peaceful picketing. The law has remained virtually unchanged since 1906, apart from some judicial glosses put upon
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    it, and we think it perfectly proper that adequate discussion should take place to see how the law should be brought up to date.
    Mr. Molloy: Does my right hon. Friend accept that since the war there has been a considerable amount of picketing and that the few cases of disruption have been highlighted out of all proportion? Do not pickets have their rights and should not those outside the ranks of trade unionism who try to exacerbate the situation be taken into consideration when legislation is drawn up to defend the right of picketing, which is a civil liberty?
    Mr. Foot: I repeat that we are concerned to protect the civil liberty of peaceful picketing.
    Mr. Hayhoe: Will the Secretary of State be a little more forthcoming and say whether he will support the Home Secretary in resisting Left-wing demands for either pardons or early parole for the Shrewsbury pickets who have been convicted?
    Mr. Foot: I have already dealt with that question in my previous replies. On picketing, which is the subject of the Question, if it puts his mind at rest I am happy to assure the hon. Gentleman that I am engaged in amicable discussions with the Home Secretary on the subject.
    Mr. Blaker: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of the reply, I beg to give notice that I shall raise the matter on the Adjournment at the earliest opportunity.

    Road Haulage (Scotland)
    Mr. Dalyellasked the Secretary of State for Employment if he will set up a commission of inquiry into the conditions of employment in the road haulage industry in Scotland.
    Mr. Booth: I have had no representations for such an inquiry from either side of the industry but would be prepared to consider any proposals they might have. I understand, however, that the workpeople's side of the Road Haulage Wages Council suggested at a recent meeting that the conciliation and arbitration service might assist in a review of negotiating arrangements in the industry.
    Mr. Dalyell: On the basis that a wise man mends his roof during a lull in the storm, is there not a case for looking at conditions in the industry, as requested by, among others, Mr. Alec Kitson of the Transport and General Workers' Union?
    Mr. Booth: I understand that in the agreement which ended the Scottish dispute the union and the employers agreed to set up a joint working party with the assistance of the Conciliation and Arbitration Service to consider relevant problems associated with the terms and conditions of employment in the road haulage industry in Scotland, including the development of a procedural agreement.
    Mr. Rifkind: Is the Minister aware of the anger and astonishment of the public in Scotland at the refusal of the Secretary of State or any Minister to come to Scotland to use his influence during the dispute? Will the hon. Gentleman explain why they refused and tell the House whether the Minister and his Department believe that their influence is so small that such a visit would not have been worth while?
    Mr. Booth: The reason why Ministers refused to intervene was that they were fully satisfied that the conciliation and arbitration service was working effectively and efficiently and that such interference might have impaired the chances of an early settlement.
    Mrs. Winifred Ewing: Does not the Minister agree that there was a state of emergency in Scotland? As there was no shortage of Front Bench spokesmen to visit Scotland during the election when they were looking for votes, is it not odd that no one could spare the time to come during the dispute? Surely a visit by a Minister cannot do any harm. Does not the Minister agree that such a visit was regarded by the Scottish people as necessary in an attempt to help?
    Mr. Booth: I welcome the assurance that the hon. Lady regards none of the visits of my colleagues to Scotland as harmful. In this instance a visit by a Minister would have given the impression that we intended to intervene in the settlement. We were not prepared to do so at that stage for reasons I have previously stated.
    Mr. Sillarsasked the Secretary of State for Employment how many officials of the Conciliation and Arbitration Service were involved in the Scottish road haulage dispute.
    Mr. Booth: The independent Conciliation and Arbitration Service is alone responsible for the deployment of its staff but I understand that two officers, supported by colleagues in Glasgow and head office were directly involved in all stages of the dispute and worked unstintingly to assist the parties to reach a settlement.
    Mr. Sillars: Will my hon. Friend place on record the appreciation of many people in the trade union movement in Scotland for the work done by these officers? Is he aware that this was an all-Scottish affair—Scottish workers versus Scottish employers? Is he not also aware that this makes absurd the charge by the Scottish National Party that what Scottish workers have to fear is exploitation by the English working class? Will he take careful note of the fact that perhaps in the next 12 months the next dispute in Scotland will be the lower-paid Scottish shop workers against Sir Hugh Fraser?
    Mr. Booth: I very much appreciate what my hon. Friend says—I refer to his earlier remarks—and I will convey it to the CAS people concerned. I hope that the dispute he forecasts does not take place, but in the unhappy event of his prophecy proving correct I am sure that the CAS will do its utmost in that case as well.
    Mr. Monro: While one appreciates what the CAS is doing in Scotland, may I ask whether the Minister appreciates that chaos is presently affecting Scotland? Is he aware that there are no buses and trains in Glasgow, that the Clyde is like a sewer and that pickets are stopping factories producing? When will he go to Scotland to deal with the situation?
    Mr. Booth: I am aware of the number of disputes, including those which the hon. Member mentions. The CAS was involved in the negotiations which led to the resolution of the dispute between Glasgow Corporation and its transport employees and those which led to the return to work of the refuse workers. The sewerage workers have been urged by their unions to await the outcome of the current national negotiations. I am

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    sure that the CAS continues ready to give any assistance that it can in the Rolls-Royce and Hoover disputes.

    Earnings
    Sir John Hallasked the Secretary of State for Employment to what extent basic hourly wage rates and average earnings have exceeded the increase in the cost of living during the six months to September 1974.
    Mr. Booth: Between March and September 1974 the General Index of Retail Prices rose by 8·2 per cent. and the Index of Basic Hourly Wage Rates rose by 14·6 per cent. The Index of Average Earnings for September 1974 will not be available until later this month.
    It is important to remember that since the end of the statutory pay policy in July a number of exceptional settlements have been made—for example, for postmen and British Rail—to correct the worst of the pay anomalies and inequities arising from the operation of the statutory controls. Additional payments have also been made as a result of increases in London allowances.
    Sir John Hall: Does the Minister agree that the figures he has given to the House show that the increases granted in recent months have added to the inflationary spiral and that, apart from the special nature of some increases that have been granted, claims that are now in the pipeline will add still further to the inflationary spiral? What action are the Government taking to ensure that future wage increases are kept within the terms of the social contract?
    Mr. Booth: During the six months from August 1973 to February 1974 the General Index of Retail Prices rose by 8·3 per cent. compared with the 8·2 per cent. which I gave in my reply. There is no evidence on that basis that there has been an enormous increase in the inflationary spiral—on the contrary. As for the attempts which the Government are making to ensure that there is not a dramatic increase, we do not expect to see a repetition of the sort of claims that came forward as a result of undertakings given in advance of the social contract wages policy to deal with particular anomalies in the public sector. If any such claims were advanced, we would
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    seek to deal with them through the social contract procedure.

    Ford Motor Company (Southampton)
    Mr. R. C. Mitchellasked the Secretary of State for Employment what consultations he has had with management and trade unions concerning those Ford workers at Southampton and elsewhere who were laid off due to an industrial dispute in which they were not involved and who have been refused unemployment benefit.
    Mr. John Fraser: Officials of my Department have been in close consultation with the Ford management and trade unions about claims to unemployment benefit made by Ford workers at Southampton and elsewhere.
    Mr. Mitchell: Is my hon. Friend aware that the Ford workers in Southampton decided not to join the recent strike and carried on working but that when the factory was closed, through no fault of theirs, they were refused unemployment benefit? Is he further aware that the reaction of the men is that, if something like this happens in future and they are to be penalised in any case, they might just as well join the strike? Is there not need for a change in legislation?
    Mr. Fraser: I assure my hon. Friend that there is no intention to penalise workers at the Southampton plant. The decision on whether they are entitled to unemployment benefit is a matter for the independent adjudicating authorities and not for me. It would be helpful if trade unions in Southampton were able quickly to agree a test case procedure to go before the insurance officer. In that way we might get the matter settled rather more quickly than has happened hitherto.
    Miss Richardson: I hope my hon. Friend will agree that the iniquitous rules on unemployment benefit need to be changed. Will the proposed legislation enable manifest anomalies in existing law to be looked at and to be changed in line with the proposals made by the Donovan Commission?
    Mr. Fraser: These matters will be kept under review, but I cannot promise changes on the lines suggested by my hon. Friend. I repeat that the matter will be kept under review.

    Industry (Employee Participation)
    Mr. McCrindleasked the Secretary of State for Employment if he is in a position to make a statement on the Government's policy on employee participation in industry.
    Mr. Cryerasked the Secretary of State for Employment if he will introduce legislation to provide for workers' control in the publicly-owned sector of industry; and if he will make a statement.
    Mr. Foot: The Government are committed to a far-reaching extension of industrial democracy in both the private and the public sectors. We are considering how this can best be achieved.
    Mr. McCrindle: Has the Secretary of State seen the suggestion that, in return for a reduction in corporation tax, private employers might be encouraged to set up trust funds for the purpose of enabling employees to buy equity shares in the company in which they operate and that they would be entitled to elect trustees, with the possibility of one trustee being on the board of directors? Assuming that the right hon. Gentleman and the Government believe in a continuation of a mixed economy, will he seriously consider this move?
    Mr. Foot: We shall give due consideration to the proposal suggested by the hon. Gentleman. However, I do not believe that any proposals in that respect could be coupled with anything that might be done about corporation tax by my right hon. Friend the Chancellor of the Exchequer. They are two separate questions. We believe that this is a highly important matter in the development of industrial democracy and we wish to have the fullest discussions in preparing for the legislation which will be brought forward in this Parliament.
    Mr. Cryer: Will my right hon. Friend accept that since 1945 worker control has been an important basic purpose of nationalisation? Will he also accept that the publicly-owned industries should be the pacemakers in worker control? Therefore, should not the Government take the earliest opportunity to ensure that appointees in these top-heavy organisations are got rid of and to see that shop floor workers have a real say in decision
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    making? Will he assure the House that the trade unions and the Institute of Workers Control are consulted in shaping any future legislation?
    Mr. Foot: I agree that the discussion and public debate on the subject of industrial democracy has in recent months taken on a much wider and broader aspect than in years past. I greatly welcome this development, which will help the Government in preparing legislation. I cannot say that we can introduce legislation immediately because I do not think that would be the best way of going about the matter. We want to have discussions, but that does not mean that there cannot be developments in industrial democracy before legislation is brought forward.
    Mr. Cyril Smith: When the Secretary of State considers this matter, will he take account of the fact that millions of workers are not members of trade unions? Therefore, when he speaks of employee participation will he think of employee participation in the widest terms as opposed to mere trade union participation?
    Mr. Foot: I know that proposals for works councils have been put forward by the Liberal Party, and we do not believe that in the way in which they have been put forward they would contribute much to our consideration—in other words, we do not think that those proposals will help in any special way. One of the best ways in which we can encourage industrial democracy generally is to encourage trade union recruitment, and we are doing all in our power to assist in that purpose.
    Mr. Prior: On the subject of employee participation, will the right hon. Gentleman bear in mind that this is a topic on which the whole House would like to proceed with as much agreement as possible and that there should be widespread consultation before a Bill is introduced? Secondly, on the question of worker control in the publicly-owned sector, in terms of the mining industry would the right hon. Gentleman prefer worker control to be exercised by Mr. Gormley or Mr. Scargill?
    Mr. Foot: On the first part of the right hon. Gentleman question, if he is now a

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    convert to industrial democracy I am sure that there will be rejoicing in Heaven and everywhere else where these matters are celebrated. On the second part of his question, it would be invidious and unhelpful of me to reply to a question that was not intended to cause national unity, not even unity in the mining industry. The right hon. Gentleman should try to catch up with his election perorations.
    Mr. Roy Hughes: Does my right hon. Friend agree that a good start could be made in the publicly-owned steel industry, which is badly in need of a shake-up? In view of its deplorable industrial relations record, does he feel that at present it could benefit from an infusion of employee representatives into the boardroom? They could hardly do worse.
    Mr. Foot: I understand my hon. Friend's deep concern, which I share, about the situation at Llanwern. We wish to see a much better atmosphere created there and will do everything we possibly can to assist in that direction. In regard to the steel industry and the other publicly-owned industries, it is part of our proposals to develop industrial democracy in the public sector as well as elsewhere.

    Closed Shops
    Mr. Hal Millerasked the Secretary of State for Employment if his Employment Protection Bill will contain safeguards for the jobs of individual workers in closed shops.
    Mr. Booth: My right hon. Friend and I are discussing this question with the TUC, as indicated in the consultative document.
    Mr. Miller: Is the Minister aware that a number of trade unionists in my constituency are as concerned about unfair dismissal from their unions as they are about unfair dismissal by the management? Will he seek to provide in the Bill some means of appeal from union kangaroo courts?
    Mr. Booth: We are concerned that any proposals for further legislation on safeguards should take into account the drafting defects of Section 5 of the Trade Union and Labour Relations Act and supplement rather than duplicate or provide an alternative for the procedures being developed in the unions and by the
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    TUC to give better remedies in cases of expulsion or refusal of admission of union members in closed shop situations.

    Unemployed Persons
    Mr. Rostasked the Secretary of State for Employment what is his estimate of the number of registered unemployed this winter.
    Mr. Molloyasked the Secretary of State for Employment how many persons in Great Britain are currently registered as unemployed; and what forecasts for the next half year have been made available to him.
    Mr. John Fraser: At the time of the count on 14th October it was estimated that in Great Britain nearly 613,000 persons were registered as unemployed. It is not the practice of this administration, nor has it been that of previous administrations, to publish forecasts of unemployment.
    Mr. Rost: When will the Government realise that the only way to prevent a massive rise in unemployment is to curb wage inflation immediately and to restore some cash and confidence in industry? What hope is there of that under the Government's policies?
    Mr. Fraser: I believe that some hon. Gentlemen on the Opposition side have a vested interest in high unemployment. [HON. MEMBERS: "Name them."] Within the last month unemployment has fallen by 0·1 per cent. The Government's policy is to maintain employment at as high a level as possible.
    Mr. Molloy: Is my hon. Friend aware that there are people in this House and outside who are making very frightening forecasts and giving the impression willy-nilly, or perhaps intentionally, that if their dreadful forecasts do not come true they will be awfully disappointed? Will he do his best to ensure that such wilful thinking does not come to fruition?
    Mr. Fraser: Yes, I can give my hon. Friend that assurance. I am not prepared to make forecasts. Some forecasts made only a few months ago varied between 550,000 and 1 million unemployed at this time. That goes to show the danger of making forecasts. The Government are determined to keep employment at as high a level as possible.
    Mr. Marten: Of the figure of just over 600,000 unemployed, how many have been wholly unemployed for over eight weeks or more and how does this compare with the number of job vacancies?
    Mr. Fraser: I am afraid that, without notice, I cannot give the figure for those who have been wholly unemployed for eight weeks or more. The figure for vacancies remains high.
    Mr. Spriggs: Is my hon. Friend aware that there is deep suspicion throughout the country that some industries are deliberately running down and creating unemployment? Will he confirm that?
    Mr. Fraser: If my hon. Friend has any evidence that employers are doing that, I shall be grateful to have it. I cannot call to mind any instance of employers deliberately creating unemployment in those circumstances.
    Sir Nigel Fisher: Will the hon. Gentleman substantiate his extraordinary statement that hon. Members on this side of the House have a vested interest in unemployment? Will he produce names and evidence for that extraordinary statement?
    Mr. Fraser: I do not want to interfere in a private row within the Conservative Party, but I should think that there is a dispute within its ranks about whether unemployment ought to go up or down. I believe that some people have an interest in prophecies of doom coming true. I reiterate that our policy is to maintain employment at as high a level as possible.
    Mr. Hayhoe: Will the Minister now have the decency to withdraw the monstrous allegation that he made? While accepting that it is not the practice of his Department to make forecasts about unemployment, may I ask whether he will confirm the estimate given by the Chancellor of the Exchequer during the election that in his judgment unemployment next year would remain at well under 1 million?
    Mr. Fraser: I do not dissent from the view put forward by my right hon. Friend the Chancellor of the Exchequer. Of course, there will be an opportunity within the next week or so to discuss these matters at much greater length on the presentation of my right hon. Friend's Budget.
    Mr. Rost: On a point of order, Mr. Speaker. In view of that disgracefully complacent answer, I wish to give notice that I shall seek to raise this matter on the Adjournment at the earliest possible moment.

    Industrial Disputes
    Mr. Hayhoeasked the Secretary of State for Employment what are the latest figures for the number of industrial disputes and the days lost as a result starting since 1st March 1974; and how these figures compare with the same period last year.
    Mr. Booth: Provisional figures for the period' 1st March 1974 to 30th September 1974 are 1,837 stoppages beginning in the period resulting in the loss of 4,772,000 working days. Figures on the same basis for the corresponding period in 1973 are 1,716 stoppages and 4,046,000 days lost.
    Mr. Hayhoe: Will the Minister confirm that there is a worsening trend, particularly if we compare recent months with last year? Will he tell us why in recent months, since statutory controls on, wages have been removed, this is so?
    Mr. Booth: I cannot confirm that there is any worsening trend. I believe that, with the removal of statutory controls, a development is now taking place in collective bargaining which will lead to a reduction in the number of disputes. We do not expect a sudden drop in the number of disputes with particular legislation. However, I should point out that there was a saving of 4½ million days lost per week as a result of the three-day week by the solving of the miners' dispute. Therefore, the actual time lost in production as a result of disputes has fallen considerably.
    Mr. Arthur Lewis: Can my hon. Friend confirm that the figures of industrial disputes he has given do not include any of the chief executives of the City of London Corporation, who, we understand, were secretly given increases of £2,500 to £3,000 a year? As this was done without consultation with his Department and as the corporation has said that dustmen and lower-paid workers are wicked to ask for a few pounds more a week, could I have my hon. Friend's comments?
    Mr. Booth: To the best of my knowledge, the increases to which my hon. Friend refers were achieved without industrial disputes or loss of working days. Had offers of similar increases been made to the dustmen, they might not have been involved in any disputes either.

    Health and Safety Commission
    Mr. Maddenasked the Secretary of State for Employment when he intends to anonunce the chairman and members of the Health and Safety Commission.
    The Under-Secretary of State for Employment (Mr. Harold Walker): My right hon. Friend announced the appointment of Mr. Bill Simpson as chairman on 2nd September 1974 and the appointment of six members on 27th September 1974. Three further members will be appointed as soon as possible.
    Mr. Madden: I am grateful for that reply. Will my hon. Friend urge the commission to direct the Factory Inspectorate to adopt a far more aggressive attitude towards enforcing the appropriate regulations and will he urge it as a matter of urgency to get on with recruiting more inspectors?
    Mr. Walker: My hon. Friend will recognise that this will be a matter for the commission and the executive when they are appointed in January, but I think he will have seen that the Chief Inspector of Factories has been taking a much tougher line recently. I said publicly recently that if the Factory Inspectorate invoked the full rigours of the new Act, it would have my full backing. I hope that the commission will take a lead from those remarks. As to the numbers of the inspectorate, when the executive is established we intend to expand. I hope that over the next few years the expansion will be of the order of 50 per cent. in the unified inspectorate.
    Sir Bernard Braine: Does the Minister recall that, after the Flixborough explosion, promises were made from his side of the House that the Health and Safety Commission when it came into existence would look at the very serious position of Canvey Island? Can he assure me now that the commission will be asked to look at that situation with the highest possible priority?
    Mr. Walker: I understand the hon. Member's deep concern in the campaign that he has been waging on behalf of his constituents on Canvey Island. I recall very well the pledge I gave him—that I would bring his powerful arguments to the attention of the Prime Minister and the Secretary of State for the Environment. I assure him that I did that and that the Secretary of State is very much aware of his concern and of the problems facing his constituents. The hon. Gentleman will be aware that we are about to establish the second committee which was envisaged by my right hon. Friend when he set up the committee of inquiry into Flixborough. I am hoping that it will be equally aware of the hon. Member's concern and of the problem of Canvey Island.
    Sir Bernard Braine: I thank the hon. Gentleman.

    PRIME MINISTER (BROADCAST)
    Mrs. Sally Oppenheimasked the Prime Minister if he will place in the Library a transcript of his ministerial broadcast on 14th October.
    The Prime Minister (Mr. Harold Wilson): I did so on the 15th October, Sir.?
    Mrs. Oppenheim: Is the right hon. Gentleman aware that the whole country welcomes his apparent conversion to the virtues of veracity? Will he, with all the zeal of a recent convert, now tell the truth about the actual increase in inflation since his Government came to power and about how much the social contract will have cost the country before he is willing to admit that it has failed? Will he admit, with his new-found candour, that much of his election campaign was based on concealment, distortion and deceit?
    The Prime Minister: I thank the hon. Lady for her concern. Nothing that I said in that broadcast had not been said by me throughout the election. On the other questions that she has asked, those matters have been fully debated during the past week and I understand that many of her points will be the subject of the debate this afternoon.
    Mr. Gorst: Does the Prime Minister agree that what is sauce for the goose is sauce for the gander and that, in view of this funny little unwritten arrangement which he calls the social contract and to which he referred in that broadcast, it would be helpful to make a similar arrangement with the CBI, one of the main pillars of which might be a return to the private sector of much that has been nationalised? That would be a quid pro quo similar to the one he has made with the TUC.
    The Prime Minister: I answered those questions a week ago. When the CBI met me three weeks ago, its representatives did not ask for the return of Rolls-Royce to the private sector.
    Mr. Skinner: Does my right hon. Friend recall that on the day after he made his ministerial broadcast the Leader of the Opposition made a broadcast and went to great lengths to tell the nation that he was Leader of the Opposition four times over? Next time he goes there, will my right hon. Friend drop a hint to the BBC that perhaps it would be in the best interests of the Conservative Party to divide the next Opposition broadcast between the leading contenders, whoever they might be at that time?
    The Prime Minister: There is no ministerial responsibility whatsoever for the broadcast on the day following mine.

    NATIONAL ECONOMIC DEVELOPMENT COUNCIL
    Mr. Adleyasked the Prime Minister when he next intends to chair a meeting of NEDC.
    The Prime Minister: I hope to do so in the near future, Sir.
    Mr. Adley: Forgetting what has happened and is happening in Scotland and Holyhead and on the Southern Region of British Rail, to name but three, when the Prime Minister chairs that meeting will he be able to claim that the social contract has now ushered in an unprecedented period of industrial peace or will he tell the truth?
    The Prime Minister: No one ever claimed that it would usher in an unprecedented period of industrial peace. We said that in a democracy it was the
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    best way of handling these problems when compared with the policies which led to confrontation last February—and the country apparently agreed. The hon. Member named "but three" incidents. I cannot remember all of them, but I know that two of the unions concerned are not even affiliated to the TUC.
    Mr. Kilroy-Silk: Is my right hon. Friend aware how fond the Leader of the Opposition is of lecturing trade unionists? Is he not surprised that, while we have a strike of consultants in the North-East, the Leader of the Opposition is not, in his normal forthright language condemning their ransoming of the sick? Will my right hon. Friend ask the Leader of the Opposition whether he will now ask consultants in the North-East to abide by parliamentary sovereignty and the Secretary of State's decision to implement a policy of the removal of pay beds, a policy that was stated in our manifesto and for which we have a mandate?
    The Prime Minister: I think that in the Parliament which ended last February there was fairly general agreement that too many Questions to the Prime Minister degenerated into supplementary questions asking for the views of the Leader of the Opposition. That is not the most fruitful way of handling Question Time, because, as I have said, I have no ministerial responsibility for the Leader of the Opposition. The matter referred to by my hon. Friend is, of course, of very deep concern. Discussions have been taking place in relation to this question for some months.
    Mr. Tom King: If the social compact is to include all useful people, does the Prime Minister feel that the livestock farmers are useful people whose interests should be considered at present? If he does, will he intervene directly in the really serious situation that they face?
    The Prime Minister: In the House a week ago I quoted in full what I said about "useful people". It seemed to bore Opposition Members; perhaps that is why the hon. Gentleman did not hear what I said. Of course it would include them. These matters were discussed last Thursday in the debate on agriculture, but the Question I am answering today relates to chairing a meeting of the NEDC.
    Mr. Heath: As the Prime Minister realises, the council has now been in existence for over a decade, broadly in the same form and with the same working arrangements. When he next takes the chair, will he discuss with the members of the council the question of broadening the organisation of the NEDC, giving it greater functions to perform and making available to its members, in a way which has not so far been done, the forecasts for the future development of the economy, in a form which will enable discussions to be carried on in the country as a whole on a more informed basis? If the right hon. Gentleman could discuss this with the NEDC it would be an advantage in the difficult economic situation that we now face.
    The Prime Minister: One or two changes were made in the council during the right hon. Gentleman's premiership. Indeed, I believe that they led to improvements. I am aware of the suggestions he has just made; I think he made them publicly in the last week of the General Election campaign. Obviously, it is a matter for the council to consider any improvements. But as for the idea of turning this into a public body, whether by having television lights and auto-cues on, by revealing all the documents that are given to the council—which no successive Government have ever done previously—or by issuing the statements made, I am sure that the right hon. Gentleman on reflection will perhaps think again about this matter. It could be considered, but it will be clear that the people there are not there in a representative capacity. I think they would all feel that they had to have prepared statements which could be issued. I think that that would diminish rather than enhance the council's usefulness.

    ABERDEEN
    Mr. Dalyellasked the Prime Minister if he will make an official visit to Aberdeen.
    The Prime Minister: I have at present no plans to visit Aberdeen, although I hope to visit Scotland again soon.
    Mr. Dalyell: Which Government Department is to spearhead the urgent drive for greater safety for the oil rig men and divers?
    The Prime Minister: My right hon. Friend the Secretary of State for Energy is responsible for the safety, health and welfare of persons working on offshore installations, including divers. As I think my hon. Friend knows, the Secretary of State is urgently preparing a comprehensive code of regulations governing both design and construction of installations and the safety of operations carried out on or near them. My right hon. Friend is also hoping to bring forward legislation before long to provide for the safety of submarine pipelines and of those, including divers, who are engaged in pipeline operations.
    Mr. Teddy Taylor: Is the Prime Minister aware of the strong feeling in Aberdeen and other parts of Scotland that the Government have been largely indifferent to the wave of industrial strife that we have had? Will he take a personal interest in the present dispute involving teachers, which is wrecking the education prospects of many children in Scotland, because it appears that a settlement is being held back by the pigheadedness of the Secretary of State for Scotland?
    The Prime Minister: This is a matter, as are other cases, for my right hon. Friend the Secretary of State, with whom the hon. Gentleman will no doubt be raising it.
    Mr. Prescott: Is my right hon. Friend aware that in attempting to deal with the safety problems in the North Sea we should not leave it to the Department of Energy, which does not have enough coverage legislatively, to deal with the problem? The death rates for divers are 250 times greater than in occupational jobs ashore, and the rate for ordinary workers is 40 times greater. It is imperative that this matter should be given over to the Safety Commission and the Department of Employment by a statutory Order in Council. This is essential.
    The Prime Minister: I am aware of what my hon. Friend has said about this, not only this afternoon but on past occasions, and his concern in the matter. My right hon. Friends, while sharing my hon. Friend's deep concern, do not agree that this is the right answer. He will know that urgent interdepartmental discussions are in progress, both on the application of the Health and Safety at Work Etc.

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    Act 1974 to petroleum operations generally on the Continental Shelf and on the rationalisation of regulations on diving safety. I do not want to go further than that at present.

    EUROPEAN ECONOMIC COMMUNITY
    Mr. George Gardinerasked the Prime Minister when he next expects to meet Prime Ministers of the EEC.
    Mr. Martenasked the Prime Minister whether he proposes to attend the next Common Market summit meeting.
    The Prime Minister: I have received and have accepted an invitation from the President of France to attend a meeting of Heads of Government of the Nine in Paris. The exact date has not yet been agreed, but it will be before the end of the year.
    Mr. Gardiner: Given the realism and flexibility among our Common Market partners, noted by the Foreign Secretary last Wednesday, will the Prime Minister approach this summit conference with some enthusiasm to give a new impetus to common policies to mutual benefit? To that end, will he take the opportunity to assure his fellow Premiers that, if a reasonable accommodation can be reached in the current round of negotiations, his Government will throw their full and collective weight behind recommending to the British people that we continue our membership?
    The Prime Minister: I cannot say exactly what will come up at the summit. I think that there will be a great emphasis on questions of inflation and unemployment, which are not only a British and European problem but a worldwide problem. I think that probably a lot of our time will be spent on them. But, as at the last summit meeting, which I approached with great enthusiasm—as I shall this one—there may be occasions, perhaps in the purleius of the meeting rather than in the centre of it, for discussing some of the questions which are being reviewed in the renegotiations in which Her Majesty's Government are concerned. But the place for these negotiations is in Brussels or, when they are
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    adjourned there, in Luxembourg, and not at the summit meeting.
    Mr. Marten: Before the summit meeting, may the House have an assurance from the Prime Minister that he will not agree at this summit meeting to any surrender of existing rights in relation to the so-called veto? Indeed, will he go further and positively propose that the so-called veto should be enshrined in a protocol to the Treaty of Rome? Secondly, at the summit meeting will he also make it abundantly clear that this House is firmly opposed to any move which will surrender even more of our national and parliamentary sovereignty?
    The Prime Minister: I should be very surprised to see these matters being raised. The kind of meeting that we had in September—I think that the intention is the same for this one—was an informal exchange of views between Heads of Government but not an attempt to do the task of the Council of Foreign Ministers, whether on renegotiation or anything else, or on any changes such as the one contemplated by the hon. Gentleman as a possibility in relation to a particular protocol. I should be very surprised if these matters were to come up. Obviously, in all these matters Her Majesty's Government would hold very dear to them the principle of the position of the House of Commons.
    Mr. Molloy: When my right hon. Friend meets the Heads of the EEC Governments, will he explain to them something which they do not perhaps really understand—the massive feeling of the ordinary people of this country, as well as of all Members of Parliament, of the history of this place? It would be a very serious issue indeed if there were any chipping away of the authority of the House of Commons, which has a status—[Interruption.]—which the present Leader of the Opposition was quite prepared to give away. The people ought to know the facts of the situation without undue and unjust propaganda by those, like the Leader of the Opposition, who wanted to get us in at any price.
    The Prime Minister: I think that the best answer I can give to that question is that while the present negotiations are about the terms and about changing the terms, some of us, including myself, in

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    the debates in 1971 and 1972, said that even if the terms had been 100 per cent. acceptable, I should not have felt that it was appropriate to deal with them by the kind of legislation that was put before the House at that time. I believe that a number of others who wanted to join even on those terms took the view that Parliament was flouted by the form of that legislation.
    Mr. Peyton: I wonder whether the Prime Minister recalls his own previous comments in the 1960s that referenda were not a suitable way of doing business? Second, will he agree that it is hard to contemplate a larger chip off the authority of Parliament than having a referendum on the Common Market?
    The Prime Minister: I should like, if I may, to congratulate the right hon. Gentleman on his "maiden speech" from the Opposition Front Bench—or at any rate on losing his virginity for the second time.
    With regard to the question put by the right hon. Gentleman, the situation has entirely changed because since those statements were made large numbers of hon. Members on his side were elected to Parliament on the pledge that Britain would not be taken in without the full-hearted consent of the British people. While I was reluctant to come to this view, I was so tortured by the thought of the remorse of right hon. Gentlemen opposite that I thought this was the only way I could make an honest pledge of it.?
    Mrs. Winifred Ewing: When the Prime Minister attends the summit, will he have any objection to taking with him his right hon. Friend the Secretary of State for Scotland?
    Mr. Teddy Taylor: Leave him there.
    The Prime Minister: I thought for a moment that the hon. Lady was about to make a suggestion for a more interesting visit to Paris, but I gather that she was referring to my right hon. Friend the Secretary of State for Scotland. I do not believe that there is anything coming up on the summit agenda that I cannot handle on behalf of the Government, with the co-operation of my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs. I think that it is the intention at the summit to keep
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    the numbers fairly small. But no vital interest of Scotland will ever be lost sight of at this summit, I assure the hon. Lady, even if she is not now going herself.
    Mr. Thorpe: Leaving aside the fact that the 1970 Labour manifesto at no stage suggested that either an election or a referendum should be a condition precedent to our joining Europe, may I ask the right hon. Gentleman whether he will raise at the summit the question of British farmers, and in particular beef producers? May I ask him not to be lulled into a false sense of security by the fact that the official Opposition did not see fit either to move an amendment to the Address or to allow the House to vote on agriculture, and will he raise it, unless the Minister of Agriculture himself on 18th and 19th November has been successful in either obtaining a temporary guaranteed price for beef, which he has not as yet asked for, or undertaking some form of intervention buying for beef?
    The Prime Minister: My right hon. Friend discussed these matters with the Agriculture Ministers on his last visit and reported to the House thereupon. I cannot, unfortunately, as the right hon. Gentleman asked me, leave aside what was said in 1970 in various manifestos. The manifesto of the Tory Party was "Our mandate is to negotiate"—no more, no less. So far as the right hon. Gentleman himself is concerned, while I think he was silent, one of his hon. Friends won a by-election on a pledge to have a referendum.

CATTLE PORTS (DEMONSTRATIONS)
Mr. Cledwyn Hughes(by Private Notice) asked the Secretary of State for the Home Department whether, in the light of the disturbances at the port of Holyhead last night, he is satisfied that the security arrangements there and in other cattle ports are adequate; and if he will make a statement.
The Secretary of State for the Home Department (Mr. Roy Jenkins): I have been in touch with the chief constables for the areas concerned, upon whom rests the responsibility for operations to maintain public order and to keep the peace. As has been widely reported, there have

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been attempts, particularly at Holyhead, to prevent the unloading of cattle, and there were disturbances last night, as a result of which 10 people were arrested. Some limited damage was done to police and other property at Holyhead and one or two minor injuries were sustained. I understand that attempts have also been made to obstruct the movement of cattle trains.
The Chief Constable of North Wales has concentrated up to 700 men at Holyhead, including contingents from Cheshire and West Mercia forces. In districts where the police are necessarily spread over a wide area, there are obvious problems in bringing adequate strength to bear at specific points, and I commend the success of the mutual aid arrangements, which have worked well. Plainly, however, there is a threat not only to law and order but also to human safety when large numbers of demonstrators gather in dock areas, and I very much hope that these demonstrations will now cease.
Mr. Hughes: I am grateful to my right hon. Friend for his reply and the assurances that he has given. Any action leading to violence and danger to life is to be deplored and does not have the support of the farming unions, but is my right hon. Friend aware, although this is not his direct responsibility, that the underlying causes of these demonstrations need the most careful examination? Clear statements of policy on the import of live cattle from Ireland and other matters affecting the beef industry are needed immediately. Will he be good enough to convey this to his right hon. Friends?
Mr. Jenkins: I shall, of course, convey my right hon. Friend's message to my right hon. Friend the Minister of Agriculture, Fisheries and Food, but I am sure that my right hon. Friend and the overwhelming majority of Members will agree with me that even if there are grievances, and even assuming that they are legitimate grievances, the way to demonstrate them is not by the means which have been adopted in recent days.
Mr. Wyn Roberts: Does the Home Secretary have reports of disturbances today in other parts of the country, notably in Barry and Glasgow? Does he know who is organising these disturbances? Is there any connection between
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them? Is there any evidence that men with a history of violence are taking part in these disturbances?
Mr. Jenkins: The answer to the last question is "No, not as far as I am aware." I shall make inquiries following the point raised by the hon. Member. There are four so-called cattle ports: Glasgow, Holyhead, Birkenhead, and Silloth, in Cumbria. At Glasgow today there were 15 pickets at the quayside to meet a boat which had recently arrived. At Barry, I understand that a boat docked at 9 a.m. It was not a boat carrying live cattle, Barry not being a cattle port, but it contained two refrigerated units, and there is a picket of farmers at the dock entrance, where about 300 to 400 people were congregated this morning.
Mr. Gwynfor Evans: Is the right hon. Gentleman aware that the normally peacable farmers of Wales have been driven to this kind of unprecedented action by the long history of unconcern and complacency shown by the Government in the increasingly desperate Welsh agricultural situation? The protests would stop if the Government did a few things at once—such as raising the ban on the export of livestock, giving a bottom to the price of beef, and giving a cash injection so that people can pay for their hay. Hundreds of thousands of animals will starve this winter unless the Government give immediate assistance to these Welsh farmers. If assistance were given, these protests would cease at once.
Mr. Jenkins: Whatever else the Government have, they do not, as yet, have a long history. Therefore, the hon. Gentleman's point about a long history is not appropriately directed. I take seriously the points he makes but he would not expect a substantive reply from me. His points will be taken into account by the Ministry, but I hope that the farmers of Wales will revert to their long history of peaceful behaviour.
Mr. Kinnock: Is my right hon. Friend aware that a very large number of Members on this side of the House are in full support of the remarks of my right hon. Friend the Member for Anglesey (Mr. Hughes) about the plight of the farmers and the railwaymen at the port of Holyhead? Few of us have any sympathy with

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Members of Parliament who use the justifiable grievances of people from agricultural areas for cheap political advantage.
Mr. Lane: I am sure we all deprecate violence in any demonstration and hope, as the Home Secretary has said, that these issues can be settled by peaceful discussion and consultation. However, do not all the regrettable disturbances show how right we have been on this side, notably my right hon. Friend the Member for Cambridgeshire (Mr. Pym), to warn the Government of the crisis in agriculture and to call for action to help the farmers?
May I ask the Home Secretary two questions? First, following the point made by my hon. Friend the Member for Conway (Mr. Roberts), will the Home Secretary inform the House in due course of the result of the inquiries he is making about the evidence that troublemakers other than farmers may have been involved? This has been one of the most sinister features of a number of demonstrations in recent years, and I think the House ought to be informed.
Secondly, fending off farmers is yet another novel task laid on our hard-pressed police, who will certainly discharge it with their usual patience and efficiency. But will the Home Secretary give the House an absolute assurance that this Government, like the last Government, will treat the police as a special case and exempt police expenditure from any financial restrictions that may be unavoidable for other local services? The Queen's Speech is regrettably silent on this problem, so will the Minsiter now make it clear that strengthening the police and safeguarding orderly life in this country will be one of the Government's highest priorities?
Mr. Jenkins: I find it almost impossible to imagine a supplementary question which covered under one umbrella a wider range of points. I will look at the question of whether troublemakers are involved. I have as yet no reason to think that is so. Indeed, there is a certain contradiction in the hon. Gentleman saying it proves how right his right hon. Friend was and at the same time saying it was all stirred up by troublemakers who were brought in extraneously. But I shall look at this matter. There is clearly a possibility, but I think no more than
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a possibility and an unlikely one, that this could be the issue here.
This is another indication of the many strains which are put on the police from a variety of quarters. I assure the hon. Gentleman that my intention, as was indeed stated in the Labour Party Manifesto, is to strengthen the police in the proper discharge of their duties.
Mr. Hooson: I agree with the Home Secretary that one hopes that farmers in Wales, as elsewhere, will return to normal peaceable procedures, but does he appreciate that for a community to resort to this kind of action shows how desperate these people are? Only a minority of the people who attend these meetings indulge in any violence. Does the Home Secretary appreciate that every legitimate means has been used to express the farmers' grievances in the House by right hon. and learned Friends of the Home Secretary and right hon. and hon. Members on this side and that no action has been taken by the Government? It is in these circumstances that the farmers have resorted to this kind of demonstration, bearing in mind that this is the only kind of demonstration that seems to move Governments these days.
Mr. Jenkins: I understand that incidents of this sort do not occur unless strong feelings are involved. I am also aware that strong feelings can be involved on a number of sides in a great number of different issues. I deplore demonstrations of this sort, whatever the instigation and whatever the source from which they come. I therefore hope that the hon. and learned Gentleman, whatever he may feel about the reasons for them, will be as strong in deploring breaches of the peace of this sort as he has been in deploring other breaches of the peace.
Mr. Sillars: Will my right hon. Friend accept from some hon. Members on the Government side that there is a very real difficulty facing the livestock industry at present? Bearing in mind, however, that these pickets have been organised, will he accept that from all quarters of the House no one would want any farmer who has been arrested to be charged under the Conspiracy and Protection of Property Act 1875? Nor would anyone in the House want deterrrent sentences applied to these people; and, without

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mentioning the word "Shrewsbury," I hope that my right hon. Friend has taken the point.
Mr. Jenkins: This Private Notice Question leads to a wider range of supplementary question that almost any other Private Notice Question I have experienced. I understand my hon. Friend's point, and I remind both him and the House that prosecutions, if they arise, are a matter for the police, or, in certain cases, for the Director of Public Prosecutions, and not for me.
Mr. Pym: Although none of us believes that demonstrations leading to the kind of scenes we have discussed could be justified, does the Home Secretary accept that the root cause of the matter is the deep despair in the livestock sector? Is it not a fact that the industry no longer has confidence in the Minister of Agriculture, and is that not the root cause of the trouble?
Mr. Jenkins: No, I do not accept that suggestion.

RAILWAY ACCIDENT (BRAMLEY)
Mr. David Mitchell(by Private Notice) asked the Secretary of State for the Environment whether he will make a statement on the railway accident at Bramley, near Basingstoke, in which three people lost their lives yesterday.
The Minister for Transport (Mr. Frederick Mulley): Yes, Sir. I much regret to inform the House that at 5.29 p.m. last night three people were run down and killed by a freight train while crossing the railway line at Bramley Station. I am sure that the House would wish me to convey our condolences to their relatives.
Investigations are still proceeding, but it appears that they were passengers who had alighted from a Basingstoke to Reading train and who, instead of using the station exit, attempted to cross the line behind the departing passenger train and walked into the path of the freight train coming in the other direction.
Mr. Mitchell: I join the Minister in his expression of concern and his words of sympathy to those involved. Is he aware
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that this is a built-up area? There is no footbridge or barrier preventing access from the platform to the level crossing. Therefore, people can get off a train and easily walk down on to the level crossing in exactly the way that happened on this occasion. Is he also aware that there is no Tannoy equipment available to the signalman, who can observe what is happening, to enable him to warn people against this? Will the right hon. Gentleman take these matters into account in his investigations, and take steps to ensure that such an accident cannot recur, by reason of the changes which I have suggested?
Mr. Mulley: I cannot prejudge the outcome of the inquest that is to be held into these unfortunate deaths. The fact is that the level crossing, which exists with wicket gates immediately to the north of the station, was closed at the time. In the light of the report we receive on the inquest I shall certainly have a look, in conjunction with British Railways, at the points the hon. Gentleman raised.
Mr. Fox: I associate myself with all that has been said. However, there is a matter which is of even greater concern. My information is that this is the second accident of this kind at this spot, and I am sure the House will expect the Minister to convey our concern about that to British Railways.
Mr. Mulley: I cannot say that I am aware of the previous accident at this spot, but naturally I shall draw the attention of British Railways to what the hon. Gentleman said. However, I am happy to feel that this is the first time that I have had to come to the Dispatch Box in pursuance of my present office in connection with a railway accident.
Mr. Beith: Can the Minister confirm that the usual procedure for investigating railway incidents will in due course take place and will lead to the kind of report that we normally get? Does he not agree that there are many railway stations where crossing the line by sleeper crossings is common practice? Therefore, the railway authorities should look carefully at the procedures to be adopted and warnings which should be given at those places. Many members of the public, amongst whom I expect are Members of the House, need to be more careful about

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observing the warnings which appear at these places and which are often casually ignored by many of us.
Mr. Malley: I am sure the hon. Member's point about people being concerned to ensure their own safety is well taken over the whole sector of transport matters. In this case the gates were closed and I am sure that regular users of the station must have been aware of the need to exercise caution in crossing the line when the gates were closed. Investigations are proceeding and it would be quite wrong of me to try to draw any conclusions until I have all the facts which will be elicited by the inquest.

STATUTORY INSTRUMENTS
Mr. Speaker: In order to save the time of the House, unless there is objection I shall put together the Questions on motions Nos. 1 to 7 relating to statutory instruments.
Motion made, and Question put forthwith pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments),
That the draft Compensation for Limitation of Prices (Scottish Electricity Boards) Order 1974 be referred to a Standing Committee on Statutory Instruments.
That the Import Duties (Temporary Reductions and Exemptions) (No. 17) Order 1974 (S.I., 1974, No. 1700) be referred to a Standing Committee on Statutory Instruments.
That the Customs Duties and Drawbacks (Revenue Duties) (Tunisia) Order 1974 (S.I., 1974, No. 1349) be referred to a Standing Committee on Statutory Instruments.
That the draft Double Taxation Relief (Taxes on Income) (Switzerland) Order 1974 be referred to a Standing Committee on Statutory Instruments.
That the draft Double Taxation Relief (Taxes on Income) (Falkland Islands) Order 1974 be referred to a Standing Committee on Statutory Instruments.
That the draft Limitation of Prices (British Gas Corporation) Order 1974 be referred to a Standing Committee on Statutory Instruments.
That the draft Limitation of Prices (Electricity Boards) Order 1974 be referred to a Standing Committee on Statutory Instruments.—[Mr. Edward Short.]
Question agreed to.

ORDERS OF THE DAY

  DEBATE ON THE ADDRESS
  [SIXTH DAY]
  Order read for resuming adjourned debate on Question [29th October] :
  That an humble Address be presented to Her Majesty, as follows:—
  Most Gracious Sovereign,
  We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland, in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.—[Mr. Weitzman.]
  Question again proposed.

  STATE OF THE NATION
  Mr. Speaker: As I announced on Thursday, I have selected the remaining amendment in the name of the right hon. Gentleman the Leader of the Opposition.
  3.51 p.m.
  Mrs. Margaret Thatcher: I beg to move, at the end of the Question, to add:
  But humbly regret that the Gracious Speech in no way measures up to the perils facing the country, and that its doctrinaire proposals will divide rather than unite the nation.
  The general impression of the Gracious Speech is that the Government think that the financial weather is that of a warm spring day instead of the bleak blizzards that we face both at home and in the prospects for world trade. Many of my hon. Friends in any critical amendment would put the handling of agriculture at the top of their list of criticisms, but they have deployed their case previously and we hope that their warnings will be heeded.
  I have been concerned for five or six years with Departments that are big spenders, and, therefore, have occasion to know that the root cause of many of today's problems is inflation, and our first priority must be to tackle that. Yesterday the Secretary of State for Industry spoke about job security. At present the threat to that security is coming from inflation and its effect upon

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  industry. I was delighted to see authority for this point of view from the Governor of the Bank of England, who the other evening said at the bankers' dinner:
  "This leads me to suggest that the first question for employment prospects may now be, not as in most post-war years, should we or should we not stimulate consumer demands but how do we safeguard British industry and with it the jobs that it provides."
  Many of my hon. Friends throughout the debate have taken up that theme, but I am afraid that it receives scant attention in the Gracious Speech. The problems that industry is experiencing are due not to its own structure but, first, to the effects of inflation upon the traditional system of accounting, which were devised when the pounds of today and tomorrow were substantially the same as the pounds of yesterday.
  We appointed the Sandilands Committe to consider inflation accounting. I am well aware from my tax days that profits for taxation purposes are computed on the basis of commercial accounts, but it is not wholly agreed among accountants what would be the proper method of inflation accounting. The matter is now urgent, and we hope that we shall soon receive the Sandilands Report and that it will be acted upon with all possible speed.
  The second reason why industry is having problems is that at a time of rising wage and salary bills, rising raw material costs and rising overheads industry has not been allowed to recover its proper costs in prices, and just at that time the Chancellor of the Exchequer chose to impose additional taxes on industry.
  Whatever the argument between the Merrett and Sykes school and the Wood and Godley school and the commentaries in the Sunday Press by Alan Day and Graham Sargeant about "When is a profit a profit?", it is agreed that the cash flow forecasts for industry are extremely serious and that the last Budget was not the time to impose extra taxes on companies. We await the Budget next week, but we must make it clear that if Governments had not taken so much out of industry they would not now have to put so much back in.
  I was delighted to see a good deal of support for this view from a Minister of State in a former Labour Government. Lord Bowden is reported in The
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  Guardian of 9th July 1974 as having said:
  "Ministers blandly assert that they are subsidising industry, but our national wealth comes directly or indirectly from industry. All a Government can do is to redistribute it and give some of it back to the industry from which they took it. It is playing with words to describe such an operation as a subsidy. In fact the Government seem to be trying to force feed industry at the same time as they are bleeding it to death. One particular firm which had paid nearly £60 million in corporation tax was given £2 million back as a subsidy—and told that it had become dependent on Government aid. The fact that the Government was dependent on the firm was never mentioned by ministers."
  As Lord Bowden had a very happy facility for putting his case cogently, it is not surprising that he did not last long as a Minister.
  I refer now to a problem not alluded to in the Gracious Speech, and that is the problem of rates. Few matters have suffered more from the effects of inflation than local authority expenditure. In local authority expenditure, of course, there is a higher rate of increase than average, because not only has it to make provision for ordinary price rises but because the services are labour-intensive and the relative price increases are higher than average.
  Last year, as we know, there were many problems, and the last Government, in the last Budget, gave some rating relief, but not enough. Some ratepayers still have very large increases; nevertheless the money is coming in even though they find themselves in considerable difficulty. The smaller businesses are in particular difficulty. Now we have reports of even larger prospective increases on the present basis of the rate support grant. Indeed, the rate of increases in 1975–76 will hit the pockets of ratepayers already reeling from the sharpness of this year's increases.
  Already council treasurers and leaders are warning the Government of rises next year of fantastic sums. In Greater London, in Greenwich and Croydon increases are expected of 70 per cent.; in Merton 75 per cent.; and in Bromley 100 per cent. Haringey council is forecasting a 60 per cent. rate rise, which could mean that householders there will have to pay a rate of a pound in the pound. The ILEA has recently warned that its precept could rise by about 50

  895
  per cent. This would cost ratepayers in inner London about £100 million extra next year. In the South-East, Kent County Council expects an increase in rates of 58 per cent.; Bedfordshire 60 per cent. Suffolk 42 per cent.; Cornwall 45 per cent.; and Hereford and Worcester 53 per cent.
  These figures are, of course, without provision for the Houghton Report on increases for teachers, which is widely expected to award an increase of about 30 per cent.
  It is not surprising, in the face of these enormous rate increases, that the local authorities should come to the Government and ask for more. Indeed, it is rumoured that they have already asked the Secretary of State for the Environment for an extra £1,500 million. I note with some concealed amusement that they have never said to the Minister, "Minister, to ask for more from the Government would restrict the freedom of local authorities." That was the argument used against me during the General Election. They have, in fact, said to the Minister "We have got large increases; you must face them." The question is: How much of them is the Minister going to face? The domestic and commercial rating system is breaking down in the face of increases of this order. We know this full well, in talking about the increases of the next order. [Interruption.] The hon. Gentleman must remember that he was in the last Government. It is not as if he had just come in.
  Governments cannot continue putting extra duties on local authorities in these circumstances. We shall not be able to wait for the report of the Layfield Committee; some interim action will be required, as well as better mechanisms for public expenditure control, as I am the first to agree that the Exchequer has no final control over the extent of local government expenditure, which can sometimes put the Exchequer into difficulty. That is one matter, with which I have been closely concerned, which has suffered very much from the effects of inflation, and which makes it imperative that the foremost strategy of the Government should be to continue to fight inflation.
  Another matter which has suffered severely is that of housing prospects.
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  In the Gracious Speech there is a proposed Housing Finance Bill which may put a bigger burden on ratepayers. This proposes to abolish the fair rent for a council house. I wonder whether the Minister's proposal is really fair to tenants, because the rent that a tenant will pay will bear little relation to the house in which he lives but will be decided by the local authority in the area where he resides. What the local authority decides and what the house is like may well be very different. One could have a house in one local authority area where the rent is comparatively low because the housing stock of that authority is comparatively old, and a similar house in another authority area, in a similar urban area, where the rent is much higher, merely because that housing authority had a lot of new housing stock and distributed the rents among all the houses.
  My experience in these matters is that many tenants would much prefer to pay the rate warranted by the house in which they live. They are fully prepared to pay the increases which would arise from the facilities which they have. I doubt whether they will welcome these proposals to alter the whole basis of housing subsidies. It is not easy to explain to them the difference between a reasonable rent and a fair rent, especially when the reasonable rent may well, in some cases, be well above the fair rent which they are paying.
  Inflation has also had a particularly difficult impact on house building. It is part of the Government's doctrine substantially to increase the number of public sector houses. Our worry is that the costs are enormous. I will give some examples. The Westminster Council is now building 202 houses in its area. The fair rent of those houses is £10 or £11 a week. The cost rent, most of which has to be met by ratepayers and taxpayers, is £55 a week. In fact, if one chooses to increase the amount of council housing, there will be a very substantial burden on ratepayers and taxpayers, and there will be a problem of financing the new houses.
  This story is repeated in many of the large urban centres. The average cost of a new council house is now about £10,000 to build. I was interested in a, report called "Inflation and Housing"

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  published by the Housing Research Foundation, which pointed out that it is cheaper to help people to buy their homes than it is to add to the public sector stock by building them for rent.
  I believe that some of the Government's policy stems not so much from inflation as from plain prejudice. I have often thought that local authorities, when they offer to house people who need houses, should not say "You can have a house for rent. Take it or leave it." They should say "There is a house. You may either have it to rent, in which case the rent will be so much, or you may buy it, in which case the mortgage payment will be so much; or you may have an option to buy it on the same basis as some of the new town corporation houses."
  I believe that to offer the choice would be more in accord with a person's human dignity than the Government's policy of saying "If we house you, you must have a house to rent." Throughout the years Labour Members and Governments have opposed the idea of offering council houses for sale, and thus I believe that they are denying many people the opportunity of owning their own homes.
  Mr. Bruce Douglas-Mann: Will the right hon. Lady explain how, given the cost of housing as described by her, it would be of assistance for the existing stock of council houses to be sold at a discount, thus reducing the stock? There might be an argument for giving assistance to buy in the open market, but how can the right hon. Lady advocate a reduction in the existing stock of council houses when it costs so much to replace them to provide for those desperately in need of housing?
  Mrs. Thatcher: Over 75 per cent. of the council housing stock was built before 1964–65. To offer them for sale would still bring a substantial profit to local authorities which they could use to build special units for old people, for which there is a serious need. The hon. Gentleman has indicated one of the points that I want to make; namely, that the Labour Party has only one idea about housing people, and that is to put them in public sector council houses for rent, whereas the concept behind modern thinking on the subject is to help people to own their own homes. That idea has been
  898
  put forward in the reports of the Housing Research Foundation.
  In respect of private housing, orders for new construction were 55 per cent. down in the June-August period this year compared with the same period last year. That is a harsh commentary on the Government's housing policies. Everything that they wish to do or have been able to do has not restored confidence to the private sector. People have, in fact, lost confidence in the future because, due to inflation, they no longer have a firm basis on which to plan.
  The Secretary of State for Industry spoke yesterday of the need for dignity in industrial relations. I agree with him. Why not give council tenants the dignity of becoming home owners? I believe that one of the most divisive factors in society is to build enormous council estates, often with a comprehensive school in the middle, which results in people living wholly in a separate kind of society. To do that denies many people opportunities which they would otherwise have had.
  Mr. William Molloy: Would the right hon. Lady acknowledge that, even if what she has just said were partially true, many of those people who come into the new council house estates and whose children go to the new comprehensive school have often, if they have come from London, come from slummy areas with despicable schools? They are embarking on a brand new life that will give them a chance.
  Mrs. Thatcher: Why not offer them a chance to own their homes? We should then have a mixed society from the word "go". I can tell the hon. Member for Ealing, North (Mr. Molloy) that some of the people who come from difficult areas into brand new council estates have wanted to go back to the communities that they knew. That is because some of the vast new council estates break up established communities.
  Mr. Molloy: Abolish the slums.
  Mrs. Thatcher: Of course we must abolish the slums. I understood that even Government policy was to recondition and modernise older houses. I understood—[Interruption.]
  Mr. Speaker: Order. If the hon. Member for Ealing, North (Mr. Molloy)

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  will not keep quiet I shall have to ask him to withdraw.
  Mrs. Thatcher: I understood that that is also GLC policy in some areas. It is one point of agreement, but most of us disagree with the hon. Gentleman, which is not surprising.
  I now turn to the effect of inflation on education costs—another Department with which I have been connected. This is a good illustration of how inflation has robbed us of a stable basis for planning the future development of the service. The building of schools and colleges was at one time planned on the basis that we should need so many places in a certain year. The money was then allocated to build those places. The present rate of inflation has now finished that kind of planning and we must now plan instead not on the basis of building a certain number of schools or a certain number of places—although that is the only sensible basis because one knows roughly where the children are—but on the basis of allocating a certain lump sum to the local authorities and saying "Choose your own projects". We can no longer have any cost limit.
  I cite these cases so that we take into account the seriousness of tackling the fundamental problem of inflation, because, as the debate on the Gracious Speech continues, I begin to wonder whether that is still the Government's prime strategy.
  I must make one or two other comments not necessarily connected with inflation but on problems concerning education. My right hon. and hon. Friends and I fought to keep some of the good grammar schools in existence and to retain them free for the benefit of children some of whom could go to them after they had been selected on a basis of ability. It was a difficult and long haul, but the previous Labour Government promptly put out a new circular during their recent lifetime. It was, therefore, a great pleasure for me when, the Thursday before the election, I saw that The Times Educational Supplement had made a survey of teacher opinion and produced a number of interesting facts. I quote from the 4th October edition which refers to the teacher poll:
  "They are clearly opposed to two major elements of Labour policy. They want to
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  retain grammar schools, which Labour are committed to phasing out."
  The article went on to say that the teachers are in favour of a statutory incomes policy. It is interesting that the majority of teachers want to retain the grammar schools at the time when the Gracious Speech speaks of abolishing them.
  There is reason to believe, judging by those who send their children to grammar schools, that members of the Government and Labour politicians may be divided on this—at any rate if their actions are any guide, compared with what they preach. To give a child a chance to rise fast is not divisive, unless ability itself is divisive. To keep a child down is wrong. To be satisfied with lower standards in education is wrong.
  I now return to the general strategy on inflation as revealed by the Chancellor of the Exchequer and in the Gracious Speech. Reliance is placed on the social contract as an essential element in the strategy for tackling four problems: inflation, the balance of payments deficit, industrial investment and maintaining employment.
  There was some comment in Questions earlier today and previously in this debate on the social contract. I have tried to obtain such documents as have been waved about on previous occasions which are said to indicate what the social contract is all about. Having read every word of them, I find nothing whatsoever which could possibly be described as a contract. A contract is something which contains precise clauses the meaning of which is clear and which is accepted as binding by both parties.
  Mr. E. Fernyhough: The marriage contract?
  Mrs. Thatcher: The marriage contract is binding unless one goes to court to get out of it. Is the right hon. Gentleman suggesting that one should go to court to get out the social contract? This is a very apt analogy, and I must congratulate him.
  Mr. Fernyhough: All I am saying is that there are millions who undertake the contract. We do not of necessity dwell on those who do not observe it.
  Mrs. Thatcher: To judge from his previous comment the right hon. Gentleman

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  appears to be fully in favour of having a back-stop of legal sanctions. It would be a very different contract from what it is now. If I may say so, a number of marriages would break up if there were not the legal sanction behind them. Indeed, some marriages without the legal sanction behind them break up rather more quickly.
  I am sorry that the Minister is looking a bit puzzled, but a red herring was drawn across the debate. I was dealing with the social contract. The social contract is not, in fact, a contract in any normally understood sense of the word. It is just not precise enough.
  Mr. Russell Kerr: Then why mention it?
  Mrs. Thatcher: I deal with it because it is the central strategy in the Gracious Speech. We are debating the Government's policy as revealed in the Gracious Speech. Therefore, I turn to what are indicated in the several documents as the guidelines—and that is about all they are.
  As I understand it, the social contract is to achieve a reduction in the growth of wages and prices on the basis of the guidelines that were agreed on 26th June and shown to wage negotiators. The Opposition contest the effectiveness of the Government's and the TUC's policies in two ways. First, how fully are the guidelines being respected, and how adequate are they? Second, is the present and probable future growth in wages compatible with the reduction of price inflation to about 10 per cent. by the end of 1976, of which the Chancellor of the Exchequer first spoke in his speech on 10th September?
  May we examine first the precise—or imprecise—guidelines that are given in this document. I quote from the summary at paragraph 34 of "Collective Bargaining and the Social Contract". It says that
  "the scope for real increases in consumption at present is limited, and an essential negotiating objective in the coming period will therefore be to ensure that real incomes are maintained."
  May I ask the Secretary of State whether the stress on saying that real incomes are to be maintained is misleading? It suggests a minimum target rather than a maximum allowance. It could be understood if the TUC were talking of
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  maintaining real incomes in terms of pretax incomes but, in practice, many negotiations are designed to protect net take-home pay—that is, pay in terms of post-tax real incomes. The two concepts are very different in terms of their results. If it were the latter, to protect post-tax incomes, we should have much larger settlements than I think the guideline is intended to mean. Perhaps the right hon. Gentleman will tell us what it means.
  The second and third guidelines state:
  "This will entail claiming compensation for the rise in cost of living since the last settlement; taking into account that threshold agreements will already have given some compensation for some price increases."
  It would seem that fixed settlements are supposed to compensate for past increases in living costs. How clearly is this being understood or followed? During the General Election campaign I heard Ministers refer to some of the settlements and say: "Well, that is about the expected rise in the increase of the cost of living next year, so it is about right within the social contract". These guidelines seem to relate to past—since the last settlement—cost-of-living increases.
  The next guideline is the 12-month interval between major increases, and it says that this should continue to apply. It seems to be an absolutely fundamental provision in the guideline.
  There seems to be considerable evidence that the 12-month rule is being broken. I have tried to argue the case on the basis of the evidence. I am well aware that cold, reasoned argument is not the right hon. Gentleman's typical style but, as we have the guidelines—it is called "the social contract"—he might apply himself to the case on the basis of the evidence and give us his views.
  The 12-month rule is a fundamental provision. I am not surprised that hon. Members want us to get through it quickly, because they are afraid that this is not a contract of any kind. But, as the Chancellor of the Exchequer in his speech at the bankers' dinner made this the cornerstone of the strategy, we are entitled to see how solid the cornerstone is.[Interruption.]
  Mr. Speaker: Order.
  Mrs. Thatcher: What has happened to the 12-month rule? The recent study in the Industrial Relations Review in The

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  Times of 29th October—my right hon. Friend referred to this earlier in the debate on the Gracious Speech—reported that 27 out of 39 major settlements had taken place less than 12 months since the last settlement. The more frequently the rule is broken, the more difficult it will be to prevent those who have obeyed the rules up till now from reopening negotiations. A 30 per cent. settlement every nine months gives a 40 per cent. annual rate of increase.
  I notice that there have been comments about the 12-month rule from some very robust trade union members. It was reported on Friday 1st November that
  "Mr. McLean, one of the six Communist members of the union executive"—
  the National Union of Mineworkers for those who are not familiar with all the names on that executive—
  "said they refused to accept that the terms of the social contract mean they could not get a rise until 1st March."
  The report went on to say:
  "They have observed that Ford and other workers have had increases before the anniversary of their last increase. If Jack Jones is able to say that the Ford settlement, even if it is only seven months since their last increase, is within the social contract, then we are satisfied that should equally apply to us."
  It is obvious that if one group goes through the rules, another group will wish to do so. That is plain, ordinary human nature. It might also accord with trade union rules, but it is much more likely to be related to the natural tendency of people to do what other have done.
  The next guideline says that
  "Priority should also be given to attaining reasonable minimum standards, including the TUC's low-pay target of a £30 minimum basic rate"—
  it was £25 per week when the guidelines were agreed—
  "with higher minimum earnings, for a normal week for those aged 18 and over."
  May I ask the Secretary of State about this, because a blanket commitment of a substantial increase in the minimum wage is obviously full of problems? We know that its effect will be to ripple up the wage structure as each group tries to restore its differential above those lower down, unless provision is made to require that the readjustment is understood and accepted. It seems to me that this is one
  904
  of those guidelines which need very careful monitoring.
  The last guideline says:
  "Full use should be made of the conciliation, arbitration and mediation services of the CAS to help towards a quick solution of disputes."
  Can we be satisfied that the services of the CAS are being fully used; for example, in the Ford dispute? Even if they are being fully used, two problems remain, because there is another special paragraph in cases where the CAS conciliates. What assurance do we have that the basis of settlements reached by the CAS will be compatible with the mastery of inflation? We all know that it is usually possible to define some price for peace, but settlements at 40 per cent.plus—such as that of the Scottish lorry drivers, for which the CAS bears some responsibility—will not ensure a reduction of inflation, nor will they necessarily lead to any resolution of the underlying problems which disputes often reflect.
  I note the Economist comment on the lorry drivers' settlement:
  "They won a rise of between 39 and 44 per cent., less than a year after their previous one, precisely what they had demanded when the strike began. The new Conciliation and Arbitration Service smoothed the employers' path to surrender, after their attempts to talk about the social compact fell on totally deaf ears."
  At the end of that paragraph the TUC states that it will be keeping the developing situation under review, and I know that it is doing so. Presumably the Government are doing the same.
  But, as this is the cornerstone of their strategy, what is the Government's objective? Do they accept as a target the Chancellor of the Exchequer's figure of a growth in prices of around 10 per cent. by the end of next year? Will they give guidance to the TUC if the course of wages threatens the achievement of this target?
  When this point was debated in their Lordships' House last week Lord Robbins urged the Government to say precisely what their guidelines would be as regards income settlements. He wanted the Government to quantify it so that the rest of us can openly judge whether or not the contract is being observed, in accordance with what the Government have in mind. So far as I am aware, no such quantification has been forthcoming.

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  The Chancellor of the Exchequer has spoken on a number of occasions about the possible course of inflation. In his speech on 10th September he said:
  "If the undertakings made on both sides in the social contract could be maintained, I believe that the rate of inflation in Britain can be brought down near to 10 per cent. by the end of 1975, and into single figures a year later."
  That is the only indication we have of the Government's target for mastering inflation. The crucial question is: what course of wages is compatible with such a reduction in the growth of prices? It is clearly necessary that the sum of the separate settlements under the TUC's guidelines, whatever their justification, should not exceed the ceiling implied by this price target. Will the Government tell the country what they have in mind?
  Looking at the indicative figures in the Price Report published earlier this week, it would seem that if that target is to be obtained by the end of 1975 wages must not grow at more than 20 per cent. a year in 1974, by no more than 17 per cent. in 1975 and, to get down to single-digit price increases, 14 per cent. to 15 per cent. in 1976. It would be a great deal easier for us to judge whether the social contract is working against the Government's rules if we knew what those rules were. So far there has been great resistance to giving them. I hope that the Secretary of State, now that he is here, will make it quite clear.
  The right hon. Gentleman's colleagues have made this the very foundation of their economic strategy. Therefore, the importance of its success, in the absence of anything and everything else, is not at issue but doubts about its success are widespread because of the evidence of past settlements.
  There are other people in society who must not be forgotten, who should have social and economic justice as well—people, for example, who have put their savings with the Government and with industry to secure the investment that is so vital. That investment is vital if the Government's other strategy in the Gracious Speech is to be carried out. All the questions raised about the price of nationalisation and how it is to be paid for have been ducked, which is not surprising. This morning the figure for the percentage yield of some Government
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  stocks was greater than that for their market price. I cannot remember whether this has ever happened before. Two and a half per cent. Consols were priced at £14·75 with a yield of 17·2 per cent. Even dated stock is at an interest rate of 17–2 per cent., and gilt-edged is the very market upon which the Government would have to rely in order to carry out some of their policies. This is a good indication of lack of confidence in Government financial policies.
  Instead of a programme to restore confidence, the Government have chosen some of the measures now before us. We believe that these measures do not match the gravity of the problems, and we shall express our disagreement in the Lobby tonight.
  4.31 p.m.
  The Secretary of State for Employment (Mr. Michael Foot): The right hon. Member for Finchley (Mrs. Thatcher) covered a wide area of ground in her speech, and I have no objection to that. She sought to bind together the different matters she raised with a single theme of suggesting that inflation has very serious consequences in housing, education and indeed throughout the whole of our economy and our social life. I do not dissent from that proposition. I would only beg modestly to indicate that inflation did not start on 28th February this year, or rather on 1st March when we were allowed into office.
  However, I believe, with the right hon. Lady, that this country must master the inflation which plagues us, and that other countries of the world must also master inflation, if we are to succeed in dealing with all the enormous problems facing us. I am sure that in that platitude all of us can concur.
  I shall come to some of the special aspects of the matters raised by the right hon. Lady a little later, and I shall do my best to answer the questions she has put about the special responsibility that I have to the House. I say to her, and to the rest of the House, that least of anyone have I the right to complain about people putting questions in the House and demanding answers. I have spent a considerable part of my life putting questions to Ministers and getting unsatisfactory answers. [Interruption.] We shall consider later the euphoria of

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  the right hon. Member for Yeovil (Mr. Peyton) in relation to his recent promotion. We now see him on the Opposition Front Bench—and that is a change and an improvement. I say that without wishing to give offence to any other right hon. Gentlemen.
  Although I agree with the right hon. Lady's view about the connecting link, which she has described, I do not believe that inflation is the only problem facing us. It is interlinked with the threat of unemployment, and it is also interlinked with much wider threats altogether.
  I agree with those who say that we face a supreme test in this country of our democratic institutions and whether they can deal with our national and international problems. It is a supreme test in this century, perhaps not of the same kind, yet comparable in degree with those tests we faced in 1945, or 1940, or perhaps 1917, or upon the other such few memorable dates in our history in this century.
  Our country has to save itself. The next two or three years will be important in seeing whether we can achieve that object. It is in that spirit and in that sense that I approach this debate.
  Perhaps I may dissent from one of the ways in which people sometimes speak of the supreme test facing this country and this House. I do not agree with those who think that the way to deal with our problems is by lapsing into some kind of one-party system by consent. Sometimes people interpret national unity in that sense—but I do not agree with that conception. I agree with the Disraeli doctrine. He said that—
  "above all we should maintain the lines of demarcation between the parties because it is only by maintaining the independence of the party that we can maintain the integrity of public men and the power and influence of Parliament itself."
  Therefore, while I believe that this Parliament is the body that can save this nation more than any other body, this Parliament must give the leadership that is necessary for the country.
  I do not dissent from the ferocity of argument in this Chamber—indeed, that is what this place is for—
  Mr. Michael Latham: A few minutes ago, the right hon. Gentleman
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  spoke about the present crisis being as severe as that of 1940. Will he remind the House of the coalition Government formed in that year?
  Mr. Foot: I think that that illustrates what I was meaning. A single, supreme national objective, such as that in 1940, was justification for the establishment of a coalition Government at that time, and I am proud of the part that the Labour Party played in the House of Commons in establishing that objective. But I also recall what happened in 1931, in peace time, when an attempt was made to deal with problems by having a coalition. It was the coalition of 1931 which led to the disaster of 1940. However, I say that merely as a corollary.
  I shall seek to answer the right hon. Lady's questions, questions such as those about wages for which I am directly responsible. We have been asked whether there is a wages explosion. We have also been asked whether inflation is out of hand, and what the social contract has go to do with it all. We have been asked whether the social contract will play any part in dealing with our problems.
  These are questions which the right hon. Lady is perfectly entitled to put and I shall do my best to answer them. I am not seeking to dodge them in any sense.
  Let me explain to some Members of the Opposition—because I think it is still necessary to do so—what has been our policy and what we have sought to achieve, especially in the important respects with which I am concerned, since we won the General Election in February and came into office in March. We were committed to the abolition of the statutory control of wages. We were committed to that because we believed that that system had been partly responsible for the catastrophe of last winter. Therefore, we sought to remove the statutory control system, although we faced special difficulties in doing so. I am entitled to underline those difficulties. The first difficulty was one that is inherent in any statutory system—the most dangerous moment in dealing with any statutory system is when one comes to remove controls. That is the moment of greatest difficulty. It is also one of the primary arguments against the statutory system. But we had to face that problem.

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  We had also to face, when we came into office in March, the inflationary prospects contained in Treasury forecasts which were on my desk. We had them there on the same day when we had the report of the miners' strike and the three-day week. Various figures were projected. For instance, there was a forecast of a 17 per cent. rate of increase in the cost of living by the end of the year, and a projected 19 per cent. rate of increase in earnings by the end of the year. So we had to deal with this commitment to remove the statutory control when inflation itself was already severe.
  Moreover, we were faced with another complication, which hon. Members who consider the matter will realise was an important aspect. Anyone who has followed these matters over the past months must acknowledge the difficulty. I refer to the threshold system, which had never been devised and operated in this country on anything like the same scale. I am not criticising those who instituted it, because many of them never realised what would be the consequences. But we had to deal with the consequences.
  When I came to office in March there was the prospect of nine or 10 triggers of the threshold system within—
  Mr. David Knox: What about this year's Budget?
  Mr. Foot: It is true that the Budget conceivably pushed up the trigger one or two points, but the second Budget knocked them down. [Interruption.] The hon. Gentleman cannot escape from that. I am trying to discuss the problem facing the country. It is not possible for any Opposition Member to argue that all triggering of the threshold system was due to the Budget, when there was when we came to office the prospect of a 17 per cent. increase in the cost of living, with the prospect of nine or 10 triggers of the thresholds. The threshold system greatly complicated the whole method of trying to get rid of the statutory system. However, we were pledged to get rid of it, and everything I have seen in that department has only convinced me how right it was to get rid of it, despite all the difficulties.
  Now we have got rid of the compulsory system. We have dismantled the apparatus, despite all the advice from the Liberal Party in the election, or per-
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  haps encouraged by its advice. Having taken all that trouble to dismantle the whole system that caused the country so much distress and difficulty, the Government certainly do not intend to reinstitute it.
  I do not know the purpose of Opposition Members. To do them credit, Liberal Members have honestly said that they want to reintroduce the system in one form or another, even if not exactly as it was before. But we did not hear from the right hon. Lady exactly what her views are. I hope that the Conservatives will tell us their views on this critical matter.
  I say on behalf of the Government that it is a matter of great practical importance that people throughout the country should not believe that we have any intention of reinstituting a freeze or statutory control of incomes. If people believe that it may happen, they will be all the more encouraged to break the social contract and prevent the system from working. We repeat—[Interruption.] Yes, we did it before, but we repeat it. We had an election in which many people were saying that such a system should be reinstituted. Those who wish to operate a voluntary system and not to return to the catastrophes of last winter should understand what I am saying and the importance of our insistence on this side of the House that we will have no return to the statutory system. We are still waiting to hear the policy of the official Opposition on this subject.
  Mr. James Prior: The right hon. Gentleman must realise that the difficulty about which he is talking was created precisely because in March 1966 the Prime Minister said almost identical words to those which he is now using, and within four months introduced a statutory policy.
  Mr. Foot: History has moved on a bit. [Laughter.] It is not a matter for laughter; it is a question of what are to be the policies of the parties of this country on the subject. Both sides of the House have moved somewhat on this matter. One side has learnt. What we are trying to find out is whether the other side has learnt. We say that, as a result of our experience between 1966 and 1970, and even more from the experience of the Conservative Party,

  911
  leading to the catastrophe of last winter, a statutory incomes policy is no solution to the problems of inflation facing the country.
  Let me come to the precise question that the right hon. Lady puts. She asked how the policy has worked and what breaches of the policy there have been. I take the report published by the Industrial Relations Review and Report, which the right hon. Lady quoted and which the right hon. Member for Lowestoft (Mr. Prior) quoted in his speech on Wednesday. It is very important that in dealing with an incomes policy we should not mislead people about what is happening. Contrary to many of the headlines in the papers, what that report said was, for example, that:
  "The general level of wage and salary increase"—
  since the abolition of pay controls—
  "seems to be in the order of 20 per cent., which is broadly in line with the annual rise in the cost of living."
  It went on to say correctly about the 12-month rule:
  "In both the public and private sectors, pay rises breaking the 12-month rule have been given to remedy anomalies, to raise pay to market rates, and generally to correct the imbalances and distortions produced by nearly two years of statutory control."
  Those are not my words, but are from the report quoted by the right hon. Gentleman and the right hon. Lady, although they did not quote that sentence.
  That report was used particularly by some of the newspapers that are most bitterly and passionately in favour of the return of the rigid statutory system. It was used to suggest that the whole social contract was being broken right and left in every particular. The Sun is the newspaper that informs us on these matters. Mr. Murdoch, who has contributed so much to the debasement of moral standards in Fleet Street, has now turned his considerable powers of befuddlement to the economic situation, and he has caught the right hon. Member for Lowestoft.
  The right hon. Gentleman did not quote the passage to which I have just referred about the 12-month rule. He said that the 12-month rule was being constantly broken, without taking any account of
  912
  those breaches that had been arranged and understood, such as the nurses' case. When my right hon. Friend the Secretary of State for Social Services announced the increase for the nurses, the Sun said on its front page, or its second page—the page opposite the other people—that we must praise the way in which it had won its campaign for the nurses. Two weeks later it was bashing us over the head for having provided the money.
  The right hon. Gentleman seems to take his statistics from the Sun. He seems to be considerably bewitched in the process, or be-bitched, if there is such a word. He said in his speech on Wednesday:
  "Average rises have been running at about 120 per cent. of the rate of inflation."
  I do not know where he gets the figures, except from the Sun. He certainly did not get them from the survey from which he selected his other ammunition, which pointed out that settlements generally were about 20 per cent. The right hon. Gentleman then spoke about
  "The biggest rises—up to 55 per cent."—[OFFICIAL REPORT, 30th October 1974; Vol. 880, c. 250.]
  Again, with remarkable selectivity, the right hon. Gentleman chose for special mention one case involving 2,400 workers out of 2 million in the survey. That is the way in which they wish to present what is happening.
  The right hon. Gentleman said that the Ford workers received pay rises of up to 42 per cent. after seven or eight months. I was certainly concerned about the part of the Ford settlement that involved a breach of the 12-month rule. However, the figure is not 42 per cent., after eight months but 42 per cent. in staged increases over the next two years as part of an agreement designed to increase productivity, promote more flexible working arrangements and generally improve industrial relations. All those factors must be taken into account.
  It is of paramount importance that no one in this House—particularly those whose voices might be listened to in these matters—should mislead people about what is really happening. That was the burden of my complaint about what the Leader of the Opposition said during the election. The right hon. Gentleman spread the story that there had been wage settlements running at 40

  913
  per cent. or more. He was able to say that only by a complete misreading of the statistics. As I said at the time, his argument was based on statistical bosh. His argument could be upheld only if there were many more people in the working population. He got the figures all wrong but he spread that story throughout the country. That was a serious matter and it may have been another contributory factor to the difficulties that we have faced.
  I have heard criticism—and I have been considerably concerned myself—about some of the settlements that have been reached. Very few settlements have approached the figure to which the right hon. Gentleman referred, but when he mentioned it during the election there was no truth in it whatsoever. The lorry-drivers' settlement in Scotland is a settlement that goes beyond the guidelines. I am not seeking to disguise these matters. I believe the facts must be stated. The right hon. Lady put a number of questions to me concerning the guidelines. It is not for me to embroider certain parts of the guidelines. As a Government we said that we welcomed the guidelines on the TUC's understanding of what they meant. It was understood that it was the pre-tax situation which applied. We agree too about the leading importance of maintaining the 12-month rule. We agree on the interpretation of the £30 target.
  The Government agree that as there is to be a £30 target to assist the lower-paid workers, such a target must be achieved in a fair and reasonable way. The Government have expressed their support for that figure as a target. It means that some other workers will have to accept some compression of their differentials if we are to achieve it. The Government agreed that pay awards should be given to the nurses, the postmen, the railwaymen and the miners because we believed that they were some of the people hardest hit under the old statutory system. The provisions being made under the new arrangements for enabling some workers to move towards the target of £30 lead us to the corollary that we wish to see the rest of the guidelines observed. I am sure that that is the desire, the determination and the intention of the TUC.
  Mr. Nicholas Ridley: Does the right hon. Gentleman agree with the Chancellor of the Exchequer that the rate of inflation is now down to an annual rate of 8·4 per cent., or is that statistical bosh?
  Mr. Foot: It is not. That is a different matter from that with which I was dealing. That is a different statistical question entirely. The figures that my right hon. Friend gave for that period were perfectly correct. The figures that were used by the Leader of the Opposition were completely misleading for the reasons that I have stated. I think that that is generally acknowledged by all the people who have considered the statistics.
  I return to the aspect with which I was dealing which I believe is of great importance. It is of particular importance if the House wishes to know the Government's attitude to the guidelines?
  Hon. Members: What are you going to do about it?
  Mr. Foot: Perhaps Opposition hon. Members will allow me to proceed. We believe that it is of paramount importance that the guidelines be sustained. If they were broken persistently it would mean that the policy of seeking to curb inflation would be greatly injured and that our determination to prevent heavy unemployment would be made much more difficult. If they were broken persistently, it would mean that it would be much more difficult to carry through the rest of the policies which the Government seek to implement in the National Health Service, in education and in other areas.
  Opposition hon. Members have asked me what the Government are going to do. First, I have made clear that we do not believe that the right way to deal with these matters is to return to statutory controls. We believe that they have failed. We abhor the idea of using unemployment as an instrument of policy. We say that the only alternative—and it is one that must be applied over a period if it is to be applied successfully; it cannot be tested in a few weeks or months—is the policy of consent.
  The right hon. Member for Finchley has asked, "What is the social contract?" If the right hon. Lady or her right hon.

  915
  and hon. Friends want to know what it it all about, it is always a good idea in these fundamentalist matters to refer to the sacred texts, particularly as in this case I happened to have taken the precaution of writing the verse myself. I ask the Opposition to look to the Labour Party's manifesto. In it they will see what we mean. It says:
  "Labour describes—as we did in our February manifesto at the time of the last election and as we do again at this one—the firm and detailed commitments which will be fulfilled in the field of social policy, in the fairer sharing of the nation's wealth, in the determination to restore and sustain full employment. The unions in response confirm how they will seek to exercise the newly restored right of free collective bargaining. Naturally the trade unions see their clearest loyalty to their own members. But the Social Contract is their free acknowledgment that they have other loyalties—to the members of other unions too, to pensioners, to the lower-paid, to invalids, to the community as a whole."
  That is the kind of Socialism in which I believe and it is the kind of Socialism which the Labour movement has preached throughout the whole of its existence. In seeking to urge that that is the right way for the country to proceed, I believe that we are following the instincts, traditions and purposes of the Labour movement. I know that different traditions prevail in different parts of the House.
  Mr. J. Enoch Powell: In everything that the right hon. Gentleman has said so far he has implicitly accepted that the general rise in wages is the cause and not the consequence of inflation. As it is his object to avoid the disasters both of 1966–70 and 1970–74, will he not loose out of his hand the weapon of the alternative view, that wage increases are more a symptom and a result than they are a cause?
  Mr. Foot: I have never subscribed to the doctrine that the right hon. Gentleman attributes to me. I do not believe that anything I have said today contributes to such a view. Indeed, since I took office, the figures at the Department of Employment have indicated the very opposite, in the sense that wages have been chasing prices rather than prices chasing wages, so I at any rate was trying to avoid that fallacy. That does not mean that a Government, seeking to plan—and I know that the right hon.
  916
  Gentleman has some difficulties in this respect—to overcome inflation, to prevent unemployment, to prevent catastrophes in our health services and in education, do not interest themselves in the level of wage settlements. We are bound to. But that is not saying the same thing as the right hon. Gentleman has attributed to me.
  However, I have been neglecting the right hon. Member for Finchley. I thought that if I congratulated her at the beginning of her brilliant bid—if I can put it that way—I might almost have been accused of intruding. We listened with great care to what she said. But there was a touch of schizophrenia in her attitude. We detected it during the General Election. She prophesies economic doom in her best, suave 9½ per cent. accent. And the right hon. Lady is sometimes a little confused about her priorities. Having listened to her during the General Election and again today, I am not quite sure just what is going to happen first—the Day of Judgment or the abolition of the rating system.
  The right hon. Member for Down, South (Mr. Powell) presents a different case, although we understand that some reconciliation may be taking place—if not, so much the better or so much the worse. I certainly agreed with something he said the other day about a fault which we are all inclined to fall into occasionally—and I am as guilty as anyone. The right hon. Gentleman said that politicians should not become preachers. He is right. Perhaps in his new incarnation he also agrees with the opposite conclusion—that preachers should not become politicians. But perhaps there is no real danger of contagion between North Antrim and South Down. Perhaps they have always been in the same line of business. No doubt it can be sorted out.
  When I explain now what the Government have to do, I shall not preach. If, in my explanation, I have the support of the right hon. Member for Down, South, I shall have to endure it.
  Governments do not have to preach but to create the conditions in which our free institutions can operate freely—and those institutions include new institutions developed out of older ones. That is why, for example, we have developed the Conciliation and Arbitration Service, which I

  917
  believe will be a very important institution in our industrial affairs.
  I was grateful to hear what my hon. Friends from Scotland said about the work of the CAS in Scotland recently. No one can doubt, surely, the skill, wisdom and dedication of those who are applying their minds to solving these problems. Part of the reason for their success in dealing with such extremely difficult problems in the lorry drivers' strike was their independence. We absolutely insist on the independence of the service.
  I say to the right hon. Lady that if the new service were to be subjected to the decrees and dictates of the Government we would destroy it. That is why it is something different. The independent service has made a good start. It received 101 requests for conciliation in September and 155 in October. It is satisfactory that both sides of industry are demonstrating such confidence in using the new service.
  In addition, the conciliation officers are paying over 500 visits a month to firms to offer advice on a range of problems relating to industrial relations, including the problems of labour turnover, absenteeism, payment talks, work allocation, and the development of consultation procedures. And their work has only just started.
  This is the constructive way in which to deal with our industrial relations. We have started in the proper way. But I recall the exact moment in the Scottish strike when the Leader of the Opposition intervened. I have every sympathy with those in Scotland who have had to endure the hardship from this accumulation of strikes. Nothing I have seen makes my concern about that any the less. But the CAS was seeking to deal with a problem which looked at one moment almost intractable.
  Then, the Leader of the Opposition, with that delicacy in industrial relations for which he is famous, felt that he must intervene. He told me, "This is the moment when you must go to Scotland and try to settle it." Yet that was also the very moment, as we knew, that the CAS was breaking what looked like a final deadlock in the discussions, a break which led to a settlement of the dispute. The Opposition and especially its Leader
  918
  should have a little more modesty in these matters.
  Mr. Teddy Taylor: In addition to achieving a settlement, is it the job of the CAS to get a settlement which bears some relationship to the guidelines of the social contract?
  Mr. Foot: I have already answered that point.
  Mr. Taylor: No.
  Mr. Foot: If I have not answered it and the hon. Gentleman will show patience, I will try to make it clear.
  Mr. Taylor: Why not now?
  Mr. Foot: I will try to make it clear now if the hon. Gentleman will try not to interrupt before I can give an answer.
  An important matter for the whole country—important to some of the disputes going on now and for the whole future of the CAS, which I believe can make such a contribution—is the healing of the very dismal state of industrial relations we have today. This is of absolute importance. It is vital that the CAS should be seen, in this context, by employers and by trade unions as being independent of the Government. Its primary purpose, therefore, is to conciliate, mediate and, maybe, to help arbitrate. We wish to restore the authority of arbitration as one of the means by which we can avoid these industrial disputes. The business of the CAS is not only to go about advising on settlements but to see how we can prevent disputes. We hope that as the months go by it will go even further and in many cases will be able to avoid disputes ever taking place.
  There is another institution which I hope will make a major contribution to solving our industrial relations problems. I know that the Opposition have a different view from ours on the subject, on industrial relations generally. I am not expecting them to agree with the measures we propose, but I hope that they will understand the purpose that we have in fulfilling our pledge to wipe out the Industrial Relations Act 1971. That purpose is not yet completely fulfilled and will be carried out in one of the most urgent measures we shall be introducing into the House.

  919
  We are doing this not out of some dogma or out of some belief that it has to be done because others say it has to be done, but because we believe that our trade unions constitute one of the essential institutions of the country and must be given the opportunity to exercise their authority and their influence. Heaven knows, most of the disputes we have at present are due to the breakdown of that influence, and one of the ways we seek to restore it is by our approach to industrial relations.
  There is another institution, an institution which, above all others in this country, can save us. It is this Parliament, this elected House of Commons, this Chamber. That is one of the reasons why I am so bitterly opposed to the dispersal—I am in favour of methods of devolution, that is different—of the final authority of this Chamber either to Cardiff or Edinburgh or Brussels. If we do that we shall have thrown away the most precious asset we have for dealing with our problems.
  Parliament is a much stronger theme in British history than in that of any other country. If we dissipate it we certainly will not be able to overcome our problems. What we have to do in the weeks and months ahead, to meet the unique combination of dangers that face us, is to re-invigorate the free institutions of our country and ensure that they can operate to the limit. That is why we wish to move further and see the spread of industrial democracy just as we wish to sustain and develop the freedom of this Parliament.
  This is the test for our country. Our task is to consider what sort of nation we are a part:
  "a nation not slow and dull, but of a quick, ingenious and piercing spirit, acute to invent, subtle and sinewy in discourse, not beneath the reach of any point the highest that human capacity can soar to."
  That is what John Milton said about the people of this country. They are the same people, and if we enlist their courage, their imagination and their daring we can overcome the accumulating problems of our country. That is the test we face in these coming years, and I believe if we face it properly we can succeed.
  5.12 p.m.
  Mr. John Pardoe: The finale of the Secretary of State for Employment was noble and superb to listen to. I was particularly glad that he quoted John Milton in that context. The right hon. Gentleman started his speech by setting out a range of problems facing the country and our parliamentary institutions from which I would not dissent. I thought that he spelled out very clearly the economic problems of inflation and unemployment facing us and I even thought that he fairly stated the distinction between the economic policies of the Liberal Party in the recent election towards inflation and the policies of other parties.
  I know that he recognises that there is that great distinction. I hope he will take it from me that the distinction in aim is not always as considerable as he said. What he wishes to do in his task, in his Department, of getting wages into line with the value of the increased output is almost exactly what we wish to do He maintains that he can do it through the social contract. I doubt whether he can, but I must say that I would welcome success from whatever quarter it came.
  I wonder whether in his tour of English literature has has come across the words of H. G. Wells in "Love and Mr. Lewisham" on the social contract:
  "The social contract is nothing more nor less than a vast conspiracy of human beings to lie and humbug themselves and one another for the general good. Lies are the mortar that binds the savage individual man into the social masonry."
  I believe that in the recent election campaign we were putting forward an honest policy which told the British people exactly what we were at and endeavouring to do. I strongly suspect that the right hon. Gentleman is endeavouring to do much the same thing by means of the social contract and I believe he will therefore be forced to do it by lies and humbug.
  The debate over the past five days has demonstrated a general acceptance of the view that we face a grave economic crisis. The Leader of the Opposition spoke of the gravest crisis since 1945. The Prime Minister, not to be outdone, went a little further and said that we have faced nothing like it since 1931. I do not wish

  921
  to go further back than that. But I still doubt whether the Government or Opposition or the nation realise the full extent of the crisis and that we face not just one crisis—that would be easy—but several.
  Everyone can make his own list of these crises. There are four with which I believe the House and the nation should be pre-eminently concerned. I take them in no particular order but I doubt whether there are many right hon. or hon. Members who will dissent from the first—the crisis of world starvation. There have been plenty of warning voices over the past decade or more but the world was deafened by the undoubted facts and success of what has been called the green revolution which created a new confidence in man's ability to feed himself.
  Today, while Welsh farmers are fighting for their right to produce more food, the World Food Conference in Rome is told that millions of people will not survive until the next harvest. What is the message which the Government send out to these starving millions and to our own food producers?
  "My Government recognise the economic problems confronting developing countries, and will seek to increase the provision of aid. …My Ministers recognise the value to the nation of expanding domestic food production economically and efficiently, and will continue their discussions with the farming industry to this end."
  The pathetic inadequacy of these two paragraphs, supplemented by the words we have heard from the Government Front Bench on these matters in the past few days—and they have been few and far between—signifies not only the incompetence of the Government which wrote them but, far worse, the moral degradation of our national will. If European civilisation means anything at all, and I hope it means the same thing to the right hon. Gentleman as it does to me, and I suspect it does, it means that we are part of the brotherhood of man, part of that fraternity for which the greatest of revolutions was fought.
  Those millions who will die before the next harvest are our brothers. The only message that will ring in their ears from this Gracious Speech as they fall into their communal graves or rot on the streets is, "Am I my brother's keeper?"
  922
  Do the Government have a food policy? If so, may we be told what it is?
  The next crisis I wish to outline is that of the European Community. The Government have embarked on the renegotiation of the terms of membership. I wish them well in their task. But the terms of Britain's membership are not the most important problem we face in Europe. The referendum which the right hon. Gentleman wants will be a futile exercise if it concentrates the mind of this nation on so limited a matter as the terms of entry, the terms of membership. What is lacking is any vision of the future Europe which we wish to build.
  Either the British people must seek and find, together with their European partners, a new sense of purpose in Europe or they will fall further into that sense of national defeatism which the right hon. Gentleman was at such pains to dispel. The questions we ought to be facing are: do we wish to build a European federation? Do we wish our generation to be the Founding Fathers of the United States of Europe?
  The noblest concept to have crossed Europe since the French Revolution has turned sour. To be fair, it did not turn sour with the election of a Labour Government on 28th February, or with the start of renegotiation. The previous Conservative Government saw no further than membership. They had no idea what they wanted to do with membership. They encouraged a fog to descend over the nobler ideals behind the founding of the European Community. Yet I believe that the political leadership of a new community of nations is there in Europe for the asking. What it requires is the vision of great statesmanship. Nowhere in the Gracious Speech or in our debates, do I find even a whisper of that statesmanship.
  The third crisis in my list is that of Northern Ireland. I have long dissented from the views of the British political establishment about our policy towards Northern Ireland. I have given that policy a fair wind, but how long must I wait for the establishment to prove itself right and me wrong? The Gracious Speech reiterates the policy. Power-sharing is no doubt a splendid idea, but the possibility of successful power-sharing was created by the reform of the electoral system and

  923
  the subsequent elections to Stormont based on that reformed system. It was destructed utterly by the February 1974 General Election, conducted on the basis of the "casino" electoral system which has returned the present Government.
  I remind the right hop. Gentleman, who is a democrat who cares about these things, that the Government have been returned on the basis of the mandate of 29 per cent. of those who were qualified to vote in the latest election. Power-sharing may never be rejuvenated in the foreseeable future. It cannot be rejuvenated unless and until all elections in Northern Ireland, local and parliamentary are conducted by means of the proportional representation system. There cannot be one system for electing members of the Parliament of Northern Ireland or Northern Irish Members to this Parliament and another for the rest of us. We are unlikely to convince the Northern Irish people on the basis of an argument which may be summarised as "Proportional representation is good for you but bad for us".
  The right hon. Gentleman mentioned coalition. The Labour Party is unlikely to convince the people of Northern Ireland of the need for power-sharing by setting out these words in its manifesto:
  "If we believe, as we must, in our own independent political philosophies, there is no meeting point between us and those with quite different philosophies, and it would be a cruel farce to suggest that the future of the country would be helped by shuffling compromising administration."
  If that is true of the parties in this House, of the parties of England, Scotland and Wales, why should it not also be true of the parties of Northern Ireland? What is sauce for the goose is sauce for the gander. There are far more powerful historical reasons for the people of Northern Ireland to loathe any form of power-sharing than there are for the people of England, Scotland and Wales to do so. Why should we expect them to behave better than we do in this respect? The present policies for Northern Ireland are doomed to failure, yet our Governments go on repeating the same old rubbish.
  I come to the fourth crisis in my list, the economic crisis. I shall not follow the course set by the two Front Bench speakers. Unlike some others, I do not
  924
  intend to repeat my election oration for the benefit of hon. Members. The right hon. Gentleman is right to say that the economic crisis is not just a matter of inflation and unemployment. The economic crisis concerns nothing less than the survival of the free economic system of the West.
  For 30 years we have assumed that our free economy would outlast the Socialist economies of Eastern Europe, that the only way in which our economic system would be worsted would be by force of arms and, given peace and security, that our economic system would demonstrate its innate superiority by any standards that we or they cared to set. Now, for the first time, we cannot be so sure.
  Given the mood of our people and the general sense of economic defeatism in the West, it can no longer be taken for granted that we shall cope with our economic problems better than will the administered economies of the East. Ranged against the despondency, lack of confidence, economic defeatism, apathy and purposeless drift of the West, there stands a pulsating, confident, purposeful economic system to the east of the Iron Curtain. It is the contrast between those two moods that fills me with apprehension.
  Today, it is still necessary for East Germany to maintain a wall to stop its citizens escaping to savour the delights and the freedom of the Western economic system, but tomorrow who can be so sure? As the economic contrast between East and West becomes less and less certainly drawn in favour of the West, so will the trumpet of freedom in the West give out a less certain note, and so will the ears of our people be less inclined to hear its call. Already we are set on a path towards an administered economy, and more and more of our people see less and less reason why that path should not be followed. Yet that path leads inevitably to the burial place of freedom.
  Can an administered economy function without the direction of labour? Can an administered economy function with the present freedom of comment in the Press and on television and radio? I doubt it. So the first crisis with which we in this Parliament must be concerned is that which threatens the very survival of the Western economic system.

  925
  Next Tuesday the Chancellor of the Exchequer will introduce his second or third—one loses count—Budget this year. He faces a daunting task which none of us would relish. Not only has he to rescue our economy from a collapse unprecedented in living memory but, more important, he has to chart the development of our economic system for the foreseeable future. If I am able to catch Mr. Speaker's eye on that occasion, I hope to deal with the economic strategy which I believe we should follow. I should like to ask one question which has not been aired adequately and that is, what is the Government's attitude and our attitude to the mixed economy?
  The Gracious Speech speaks of wishing
  "to encourage industrial investment and expansion within vigorous and profitable public and private sectors of industry."
  The legislation proposed seems totally irrelevant to that desirable aim. If the two parts of the mixed economy are to be vigorous and profitable, we need to erect distinctive barriers between them, and we need new criteria by which to judge their vigour and profitability.
  How can the Government talk of profitability in the public sector when since February they have presided over an increase even in the prodigious size of the subsidies perpetrated by the Conservative Government? They have presided over a massive increase in the public sector deficit largely brought about by the huge subsidies to nationalised industries.
  How can the Government talk of profitability in the private sector when their own price controls are designed to make that profitability impossible? How can the Government talk about profitability at all when "profit" has been allowed to become a dirty word among possibly a majority of the British people of all political persuasions?
  We must recognise that the mixed economy ought to be not so much a mix of the public and private sectors as of the competitive and administered sectors. We have to distinguish between those parts of the economy which want to live in conditions of competitive free enterprise and those which want to live with
  926
  the benefits and protection of monopolistic practices. By no means all the companies now within the so-called private sector fall within the former category. Many hedge themselves around with monopolistic practices, deposit their begging bowls permanently on the steps of the Department of Trade and Industry, and would faint if they had to face up to living in the competitive free enterprise sector of industry.
  These companies must decide where they want to live—whether they want to live in the private sector, or whether they want to become part of what should be now known as the administered sector of our economy. If they choose the former, in my view so much the better. They must have competition thrust on them; they must learn to live in the market and to raise their capital in the market rather than from the taxpayer. They must be forced to make profitability desirable through profit sharing, co-ownership and the whole paraphernalia of industrial democracy and participation.
  In return, the Government must undertake to pursue economic and fiscal policies which will enable those companies in the private sector to raise their capital in the market and to make a profit.
  In the administered sector new criteria of efficiency must be devised. Profitability and return on capital are far too susceptible to the diktat of the hustings to serve as a valuable guide to how the public sector is performing. We need, not a National Enterprise Board, but a National Social Audit to monitor standards of service, efficient use of manpower and capital resources and the optimum use of imports and energy.
  In setting these standards we should pay careful attention to what the best of the private sector is doing, where it is, comparable and, far more important, we should pay attention to what other comparable industries elsewhere in the world are doing. Why does the average British railway engine driver drive his engine only 6,000 miles a year, rather less than the average motorist drives at weekends during the year. I do not know the answer to this but, before assuming the worst, I should like to know how far the average Japanese or French engine driver drives.

  927
  Tonight we are asked to vote on what I presume is meant to be a reasoned amendment to the Queen's Speech. Yet it is no such thing. It is phrased in terms of outright and wholesale rejection. I reject the concept and philosophy behind the Queen's Speech. I condemn its lack of political vision. I abhor its irrelevance to the four crises I have mentioned. I shall vote against the Gracious Speech, but I shall not vote for the amendment in the name of the right hon. Gentleman the Leader of the Opposition. To do so would be to lend support to the man and the party which, although they did not create our present economic problems, left our flanks exposed and, without scouts or a vanguard, led us into a valley where we could be ambushed by the economic forces which have come along since. That is the case against the Conservative Government.
  The amendment is part of a new myth-making process. Conservatives are busy making the myth that the Leader of the Opposition is the tough guy, the man who warned this country of the coming economic collapse, warned it of the great raging fires of inflation that were to beset us—
  Mr. Michael Foot: The chief incendiarist?
  Mr. Pardoe: The right hon. Gentleman has phrased it better than I. That is the whole point. The right hon. Gentleman the Leader of the Opposition presided over the most rapid expansion of the supply of phoney money, and allowed the public sector deficit to climb to unprecedented levels. He is the man who introduced stage 3 a year ago, despite our warnings that it would be ruinously inflationary; the man who allowed nationalised industries to run up the largest deficit in their history. I do not think it lies in the mouth of the Leader of the Opposition to claim that he was the man who warned the nation of inflation. In the election we set out to warn the British people of that great danger.
  My greatest fear is that this nation will manufacture a new myth not just about the right hon. Gentleman but about its own future. We have lived on myths too long. We have stumbled from one to another until each has become untenable. In the 1950s it was the myth that
  928
  we had won the war and were entitled by virtue of our empire and Commonwealth to sit at the top table. In the late 1950s the myth was that we were an economic power of the first order and could sustain one of the highest standards of living in the world without making fundamental changes in our whole industrial system.
  Now a new myth has taken hold—namely that, although we may not be a great world Power and are not very successful at running our economy, Britain is still a nice place to live in. American expatriates living in London pat us on the back and tell us what a lovely lot we are. I wonder how long it will be before even that myth is overtaken by events and crashes to the ground. How long will it be before it is destroyed by events in Northern Ireland? Is Belfast a super-civilised place? Have we ever displayed our genius for democratic government and the political arts in that province?
  Mr. John Mendelson: The hon. Gentleman is spoiling an average speech.
  Mr. Pardoe: The hon. Gentleman says that, but he has never made a speech that could possibly measure up to the word "average". Is Glasgow, now threatened with the environmental destruction of the Clyde by 120 men who are pouring millions of gallons of sewage into the river each day, a place to make us proud of our civilisation? I think not. I believe that the social unity of Great Britain, on which effective democratic action must rest, is now in peril.
  I shall vote against the Gracious Speech tonight because nowhere is there a sign in it that the present Government, or indeed the official Opposition in their amendment or in any of their speeches, realise what is at stake or what has to be done to save this country from that peril or from the destruction of our democratic institutions.
  5.38 p.m.
  Mr. Bryan Gould: As is customary in a maiden speech, I wish to make a friendly reference to my predecessor, Mr. James Hill. James Hill, who has many friends in Southampton and, I have no doubt, many friends in the House, made his main contribution as a parliamentarian in two

  929
  fields—Europe and housing. I have no wish to follow him on the road to Strasbourg, but I share his close interest in housing.
  The House will recall that James Hill served for a time as secretary of the Conservative back-bench committee on housing and was also member of the Standing Committee on the Housing Finance Bill. Prior to his election in 1970 he was chairman of Southampton's housing committee. Although he and I doubtless would disagree on the nature and causes of our present housing problems I know that we would unite in recognising the seriousness of the problems and the need for urgency in dealing with them.
  I should also like to pay tribute to another of my predecessors who, happily, is still with us. I refer to my hon. Friend the Member for Southampton, Itchen (Mr. Mitchell). I have been fortunate enough to have him as my mentor, not only in these first few somewhat confusing days as a new Member but also in the three years since I was selected as a candidate for a Southampton division.
  My hon. Friend and I have the privilege of representing one of the most attractive and prosperous cities in the country. Anybody who has seen the tree-lined avenues of Southampton will testify to its attractiveness. Its prosperity is based on a flourishing light industry but, more particularly, on its rôle as a major international port. Southampton Docks are one of the success stories of public enterprise. Southampton is now the second most important port in the country. We believe that we have the facilities, the skill, the experience and the labour relations to do, at a fraction of the cost, the job which some people suggest will cost millions of pounds of public money at Maplin. I make that point in the comfortable knowledge that in doing so I represent the interests not only of my constituents but also of the taxpayers and the country as a whole.
  I have said that my immediate predecessor and I share an interest in housing. It may be asked why a city so well favoured as Southampton should have a housing problem. A measure of the gravity of our national housing situation, is that housing even in Southampton has become the single most pressing social
  930
  problem. That is not just an academic observation. For the past two or three years in Southampton I have run a free advice centre which deals with over 1,000 cases a year. It is possibly one of the most important voluntary operations of its kind in the country.
  Increasingly over the last year or two the people who have come to that centre for help and advice have been the homeless and the badly housed. They are young married couples with one, two or possibly three children living in tiny overcrowded houses with in-laws and sleeping and eating in one room with all the intolerable strains that that imposes on family relations. They are pensioners living in privately-rented accommodation, whose absentee landlords cannot easily be traced, who have to place buckets in their front rooms to catch the water coming through the ceilings and who are unable to use the only electric light socket, their only means of heating, because the water running down the walls makes it too dangerous.
  The housing situation in Southampton has deteriorated rapidly over the past few years. In 1968 new aplicants could be housed within three or six months of application and engaged couples could be promised houses upon marriage. Now we have an active housing list of over 4,000 families. Even those with the most pressing circumstances, the most difficult, in-sanitary, and overcrowded situations, must endure a minimum delay of seven to nine months, and newly married couples literally have no prospects of being housed in the city.
  How did this desperate situation arise? I trust that a straightforward recital of the facts will not be regarded as too controversial for a maiden speech. At the end of the 1960s it was thought in Southampton that the provision of housing could increasingly be left to the private sector. As a result the council building programme was cut from a peak of 1,400 houses in 1965 to just 278 in 1970. Existing council houses were sold off. Most important and serious for the future of the housebuilding programme in Southampton, building land which had been accumulated by the council was sold to private builders. The expectation that the private sector could handle this responsibility was falsified almost immediately by the mortgage famine and the rapid rise

  931
  in house prices. Therefore, not only did those seeking new houses turn back to the public rented sector, but those who were already housed in that sector were that much less likely to move out into the private market. For example, vacations in Southampton fell from 1,100 in 1968 to 700 in 1973.
  If Southampton's recent housing history is bleak, the future is bleaker. The building programme, which is already hampered by a shortage of building land, will come to an end in 1978 because there will then be no building land at all. By that time, even taking into account the purchase of available private houses to add to the housing stock, the housing list will have grown to 6,000 families. That figure spells real human misery. It also spells an appalling waste of local authority resources.
  Southampton ratepayers pay hundreds of pounds each week to put families into bed and breakfast accommodation because there is nowhere else for them to go. The ratepayers spend £30 a week per child in care because it is only by breaking up families that accommodation can be provided for them.
  In addition to direct costs, we must take account of the indirect burden on the social services, the education and health budgets, and the increase that bad housing means in the crime and vandalism figures.
  What can be done? First, we need land. We need 500 acres of land outside the city to build the houses Southampton needs. We need powers of land acquisition and assembly. Then we need the resources, which can be made available only by Government decision, to build houses for rent and for sale. With respect to the argument advanced by the right hon. Member for Finchley (Mrs. Thatcher), I think that most people recognise that there will be a continuing and substantial demand for rented accommodation. We must also press ahead with the modernisation of council houses and offer help to the owner-occupiers of older properties through the medium of improvement grants and equity mortgages. We must have greater flexibility on cost yardsticks, tendering procedures and possibly building standards. We must also draw into co-operation the housing associations. In other words, we must
  932
  use every weapon in our armoury to try to deal with this terrible problem. I am glad that this problem is recognised by the Government in the appropriate passage in the Gracious Speech.
  Policitians, particularly new Members, are often warned about the limits of their powers to effect any real improvement in the lives of ordinary people. As a general proposition I accept that as true, but here is one political problem which could be solved by the exercise of political will. Here is one way in which we could effect a dramatic improvement, a transformation, in the lives of the homeless and the badly housed. The problem is simple and so is the solution. We simply need to build more houses. I hope and urge that, for the sake of those on housing lists in Southampton and elsewhere, we will do just that.
  5.47 p.m.
  Mr. Ian Percival: In the best traditions of this House the hon. Member for Southampton, Test (Mr. Gould) paid a generous tribute to his predecessor with which all of us who knew him would agree. It is my great pleasure to congratulate the hon. Gentleman on his maiden speech. I know that he will not wish me to dwell on the content of it. But I should like to congratulate him on speaking with such eloquence and feeling, qualities which all in this honourable House enjoy and respect.
  The hon. Member for Cornwall, North (Mr. Pardoe) made a provocative speech. He tended to blame everything on the Conservative Party and my right hon. Friend our leader. I am tempted to deal with some of the points that he made, but I believe that my right hon. Friend the Member for Finchley (Mrs. Thatcher) spelled out the answers in advance, so I shall not be tempted to do so.
  I want to dwell on one aspect of the debate and of the amendment. I refer to the divisiveness of the Government's action in recent months and in the programme that they have laid before the House. In order to win the last two elections they have gone out of their way to stir up, at best, distrust, and at worst, hatred amongst different sections of the community.
  One has only had to listen, as I have, to the vicious speeches made on industrial

  933
  relations by the Secretary of State for Employment, smiling and sitting there for the moment, to know of his hatred of some sections of the community and his willingness to accord great preferences to other sections. I think that he may soon reap the whirlwind which he has sown. He may soon become the victim of the very extended powers which he has given to those whom he thought were his friends.
  I want, however, to stick to the general point about the degree to which trust between man and man has been destroyed by the conduct of the Government and those who support them. We should all now be concentrating on building up that trust which is so essential if the people of this country are to work together, which is the only way we have of pulling ourselves out of those difficulties. If we will but work together, these difficulties can readily be overcome, but unless we do, no amount of theory or doctrinaire practice will make much difference.
  At a time when one could have thought that it was so obvious to everybody that that is above all what is wanted, the Government who should be setting the lead in restoring trust and drawing people together are once again doing the opposite. The best way for the Government to restore trust in other people is to show that they are trustworthy, but they are not.
  The Gracious Speech says:
  "…My Government, in view of the gravity of the economic situation, will as its most urgent task seek the fulfilment of the social contract as an essential element in its strategy for curbing inflation".
  Fine words, but what a hollow mockery when one analyses what, if anything, they mean. How can one "seek the fulfilment" of something which no one can even define? There has been no definition of it in the six days of this debate. It is still some vague notion in someone's mind which no one condescends to define, not even the Secretary of State.
  But so far as we can get near to ascertaining what it is, we find that it is a contract with one section only of the community, under which that section lays down the price that it will extract for giving that degree of civil obedience and co-operation that it is the duty of all of us to give. What kind of contract is that, what kind of step is that towards
  934
  welding this great people into one unit to act together again? Yes, the idea of a social contract is a noble and fine concept if the contract is between all the people and the Government. As it is, once again these words in the Gracious Speech are just noble-sounding phrases with no meaning—a hollow mockery.
  Yesterday, the Secretary of State for Energy was asked many clear and specific questions about what was meant by other observations in the Gracious Speech—questions to which the people are entitled to an answer if they are to give the trust required of them which alone will make things work again. I refer in particular to the question asked by my right hon. Friend the Leader of the Opposition, about what one part of this programme would cost and where the money would come from. In the closing speech yesterday, the holder of the great office of Secretary of State for Energy gave no answers to the questions that we are entitled to have answered. On the contrary, he ended by spitting abuse across the Dispatch Box. Again, today, we have had a speech of boisterous boloney from the Secretary of State for Employment, but again no answers to the serious questions put to him about the social contract.
  Their whole approach, and their specific policies, are such as to divide—
  Mr. John Mendelson: Come off it.
  Mr. Percival: I want to deal now with the doctrinaire policies which I know are so important to the hon. Member who intervenes from a sitting position but which he should know are bound to divide the country. I refer to the doctrinaire measures of nationalisation. The vast majority of the people do not want them. If the Labour Party had fought the election on the simple issue of whether the country wanted more State control, they know that they would have lost the election hands down. We do not want to become a Communist country, although the hon. Member for Penistone (Mr. Mendelson) may disagree with me. These doctrinaire measures put at risk not only our standard but our way of life.
  Mr. Robert Kilroy-Silk: The hon. and learned Gentleman is of course well aware that he is talking much codswallop now as he has on previous occasions. When he talks of the

  935
  faith of the British people in the Government, is he not aware that at an election a few weeks ago, when the policies of this Government were fully put before the people, as they had been in February, they were overwhelmingly endorsed—[HON. MEMBERS: "No."] But they were. Hon. Members are sitting on that side of the House because those policies were overwhelmingly endorsed. The hon. and learned Member is fond of asking erudite questions. Perhaps he would tell us what the Conservative Party proposes as an alternative to the social contract and the proposals for the regeneration of British industry.
  Mr. Arthur Lewis: Confrontation.
  Mr. Deputy Speaker (Sir Myer Galpern): I would remind hon. Members that interventions are not to be used as vehicles for speeches.
  Mr. Percival: I will confine myself to the first part, which was a genuine intervention. I am glad that the hon. Member made it. He and other hon. Members should learn that it is no good trying to turn this argument aside with abusive comments like that. We must face up to the issue and look it in the eye. More and more nationalisation and State control to me is simply Communism under another name. I have never understood the difference. It must change the nature of our society. It is no good trying to sweep that under the carpet. Sneers about "Reds under the bed" and "codswallop" have been effective for too long. We should no longer be deterred by that sort of attack.
  Do we want more and more State control? Do we want to move more and more towards a Communist country? If we do, fair enough. That is what democracy is all about. But do not let us try to brush that issue under the carpet, as so many right hon. and hon. Members opposite always do, by suggesting, in the hon. Gentleman's elegant phrase, that it is "codswallop".
  If anything is calculated to divide this nation, when what is wanted is unity, it is to proceed with doctrinaire measures which put both our standard and our way of life at risk.
  936
  I doubt whether this Government can think again and turn away from that course. There is strong evidence that they are so much in the hands of the extreme Left wingers that they must go ahead with these divisive measures—[Laughter.] I will not be deterred by the laughter of the hon. Member for Penistone. If he can disprove it, I shall be happy, but let him not try to turn the argument away in that silly fashion—
  Mr. Mendelson: Sit down and give me a chance, then.
  Mr. Percival: I am tempted to provoke one or two more comments like that, because that would show where the people are who are not prepared to look the argument in the eye. The hon. Member, who has made so many sedentary interventions, would, I suspect, like us to move as rapidly and as far as possible to a completely State-controlled country. If that is what he wants, let him say so and not just ridicule those who are not afraid to say that we do not want it and that we will fight it, whoever in the Labour Party chooses to laugh at our efforts.
  As I said I doubt whether the Government can change their course now, but I put this plea to them. Will not they give just one last thought to putting both petty spite and doctrinaire policies to one side? Could they not even now change course and give to this country the lead for which its people long, a lead towards unity, so that all the people of this country may once again know the thrill of working and winning together for Britain?
  6.0 p.m.
  Mr. Douglas Jay: I also should like to congratulate my hon. Friend the Member for Southampton, Test (Mr. Gould) on an excellent speech about housing. He certainly shows that he understands the housing problems far better than does the right hon. Member for Finchley (Mrs. Thatcher). I agree with everything that he said.
  The hon. Member for Cornwall, North (Mr. Pardoe), who spoke for the Liberal Party, rather spoiled what was perhaps a good rather than an average speech by too-constant repetition of clichés about "the gravest crisis since 1945", or 1931 or whatever it is.
  Mr. Pardoe: The Prime Minister said it.
  Mr. Jay: Yes, but I disagree, whoever says it. 'This language is both inaccurate and misleading. As the country is faced with real difficulties, I believe that the public would be much more impressed if we stopped talking in these generalities and explained more clearly just what the economic problem is and what ought to be done about it.
  If we are to do that, we should do well to start by ceasing to repeat the words "crisis" and "inflation" as though they were some sort of incantation. It is not a crisis that we face. It is three, four or five years' hard slog. It is not even inflation, in any proper sense of that misused word. We certainly did suffer from a runaway credit expansion under Mr. Tony Barber, and we are still facing the aftermath of that. But essentially the trouble now is a rapid runaway of prices due to cost-push pressures.
  It is not surprising that the public are a little sceptical about this talk when the same people who told us a year ago that we were facing the problems of success and told us two years ago that joining the EEC would solve all our economic problems are now saying that we are facing the gravest crisis that we have ever known.
  What are the facts of the situation? First, we face a huge oil deficit on the balance of payments, as does practically every industrial country. This can be eased only by oil economies in this country and by the recycling of the oil revenues of the Arab countries, partly through international institutions, so that they can be re-lent to deficit countries.
  Secondly, we face a serious, but a now decreasing, and quite unnecessary non-oil trade deficit which is wholly accounted for by our trade with the EEC countries. No one has pointed out in this debate that our visible trade with the EEC, which showed a deficit of under £100 million a year as recently as 1970, is this year running at a deficit of nearly £1,900 million at an annual rate.
  Thirdly, we face an excessive rise in internal prices and in money rates of pay. But some people here have not noticed that these 20 per cent. to 25 per cent. a year rises in rates of pay and
  938
  prices are occurring in almost all the industrial countries of the world, so that, whatever the cause of it, it cannot be purely a British one. Indeed, more striking still, for those who care to look at the figures rather than just denouncing what they call inflation, is the fact that the countries which have had the steepest rises in internal prices in the last few years have also had the highest rises in real incomes, and vice versa. That is a fact which many people have not grasped.
  In the face of these hard facts, which one is compelled to summarise very briefly in the debate, what action should we now take? First, in my view, we should attack the oil deficit very vigorously by oil economies in this country. I believe that the Chancellor might well start with a rise in the petrol tax in the Budget next week, unpopular though that would no doubt be. Let us also have a general programme of oil economies, thought out and put into operation by the Secretary of State for Energy very soon, if possible this month. We are wasting not merely a great deal of petrol. We are also wasting a great deal of oil in central heating at present. Other countries are doing more about this than we are.
  Next, if we are going to cut the total payments deficit in the next three years to a manageable figure, I believe that we need a three-year to four-year concerted recovery programme not so very dissimilar to that which was adopted at the end of 1947.
  Incidentally—I say this to the hon. Member for Cornwall, North—those who talk wildly about "the worst crisis since 1931 or 1945" may be surprised to learn that the current balance of payments deficit was 4 per cent. of gross national product in 1947, and that our non-oil deficit this year is only 1·1 per cent. of GNP. Even if one adds in the whole of our oil imports, it goes up to only 6 per cent., so the figures are not really so vastly different.
  The problem is in principle much the same as we faced in the winter of 1947–48. The policy adopted over the next three years should be very similar, that is, to hold down consumption for a time—which would not really be so terrible for our standard of living—and to

  939
  switch extra output to exports and investments. There is no need for unemployment if we plan sensibly, still less for all the rather wild talk we have had of massive unemployment being just around the corner. It is consumption, not production or employment, which we need to hold down.
  I do not agree with the right hon. Member for Leeds, North-East (Sir K. Joseph) in his interpretation of the unemployment figures or in his view that we have to tolerate much higher unemployment. I think that he would understand this better if he looked, for a change, at the figures not of unemployment but of employment. He would then find the remarkable fact that there were this June 22,700,000 people employed in the United Kingdom, compared with 23,700,000 in June 1966. There are, indeed, 1,500,000 fewer people employed in manufacturing today than there were in June 1966.
  The truth is that we are not over-employed but under-employed at present. To avoid worse unemployment, however, the first priority should now be given to a more vigorous and concerted export drive. In particular, surely we should concentrate this on the oil-rich countries. They have the money to spend on goods of a great many kinds. Are we now working for more direct Government-to-Government agreements with those countries, as indeed are the French, with Iran, Saudi-Arabia, Iraq, Kuwait and the like? Are we organising, as we should be, British industrial exhibitions, British weeks and export missions, outward and inward, towards those countres whose purchasing power is enormous, in particular, Iran? Higher British exports to the oil countries would ease all our problem of employment and investment, as well as the balance of payments. I believe that this should be the first call on the Government's energies at present.
  Next, I agree that we should make room for higher exports by a reasonably tight monetary policy. I do not blame everything on monetary policy but bad monetary policy certainly makes things very much worse. We should, therefore, have a reasonably tight monetary policy at present, and Budget economies on extravagant and dubious projects such as
  940
  the Channel Tunnel and a great deal of our motorway programme, which last encourages rather than discourages more consumption of oil. If there be any case for all these ambitious projects, this is surely not the right time for them.
  At the same time, I believe that higher taxation on inessential spending would help, as it certainly did in 1948— and not merely on petrol, but, if the Chancellor thinks it necessary, on a much wider group of important consumer goods which we are buying now on a fantastic scale from the outside world and which are covered by VAT but are of the sort which does not have a major influence on pay claims.
  What folly we can now see it was to switch over to the inflexible VAT from purchase tax, which could be much more selective and adjusted to particular goods being taxed. If we cannot return to that at once, we must at least introduce a lower rate of VAT for necessities and a higher rate for less essential spending.
  I believe, too, we should strengthen the social contract by abolishing outright the absurd import taxes and levies on standard foodstuffs which are now forcing up food prices and helping to generate many of our more ambitious pay claims. Indeed, a return to guaranteed prices and deficiency payments for agriculture would do more than almost anything else to ease our problems quickly. We have heard a lot today about the behaviour of Welsh farmers. If we had not given up the policy of guaranteed prices and deficiency payments, this conflict of interest between the consumer and the farmer would never have been imported into this country and we should not have had that sort of protests occurring.
  Concurrently with that, I agree that investment must somehow be encouraged. As one who, all my life, has advocated higher taxation on industrial profits, I am now convinced that some easement is necessary at the present time. I hope that it will take a form, as in the successful investment grants eight years ago, which will genuinely encourage industrial investment rather than merely increase dividends.
  If all that is done, I do not believe that greater common sense in pay claims, to use Mr. Jack Jones' phrase, by voluntary methods is really beyond our power

  941
  to achieve. If one is not to have statutory pay control—I wholly agree with my right hon. Friend the Secretary of State for Employment that that is right—it seems to me that we must have as some part of the new Conciliation and Arbitration Service at least some respected independent tribunal which can give a final ruling on disputed claims.
  The most successful tribunal we have had yet, with all its imperfections, was the National Board for Prices and Incomes. Its abolition was one of the worst major mistakes of the then Tory Government, and we have failed to establish anything yet as good as that.
  I hope that the present Government will soon tell us—my right hon. Friend today said something about an improved arbitration system—who will give the final rulings under the régime into which we are now entering. I do not see the social contract succeeding—and we all agree that that is crucial to the nation's future—if anybody is at liberty to say "My claim is within the social contract even though it may not look like it". That is likely to produce anarchy, and real inflation—if one must use this word.
  The hard arithmetical fact is that if our real incomes cannot be increased for a few years and we all pay ourselves 20 per cent. more in money, prices will rise 20 per cent. whatever anybody, including my right hon. Friend the Secretary of State for Prices and Consumer Protection, does about it.
  Let us have more action along these lines—more oil economies, an export drive to the oil-rich countries, an effective pay tribunal, and a return to guaranteed prices and deficiency payments for food products. And let us have less verbiage about inflation and crisis.
  6.15 p.m.
  Mr. James Molyneaux: It is perhaps appropriate that a Unionist should speak to an amendment dealing with the unity of the nation, because we in the United Unionist Coalition are part of that wider Unionist tradition which has contributed much to the political life of the whole of the kingdom.
  The United Unionists were sent here to play their part, together with friends and colleagues from Great Britain, in preserving that tradition. We were elected
  942
  by 58 per cent. of the voters of Ulster on a mandate—to give effect to the first stated objective in our united manifesto which read as follows:
  "We are totally committed to maintaining and strengthening Northern Ireland's union with Great Britain within the United Kingdom."
  In referenda and in election after election the people of Northern Ireland have reiterated their wish to remain British. It is precisely because others, who may not have been quite so enthusiastic about preserving the unity of the nation, have sought to subvert that wish, that uncertainty and unrest have continued for five years.
  Since I assumed certain responsibilities two weeks ago I have been asked what would be my remedy to end the strife and bloodshed. My answer is simple and, I hope, reasonable. It is that the Parliament of the kingdom should clearly express its will to maintain and preserve the unity of the United Kingdom. More than any other, this simple step would—if I might borrow a phrase from my right hon. Friend the Member for Down, South (Mr. Powell)—remove the hopes of the terrorists and the fears of the law-abiding people of Ulster.
  I do not think that we are asking too much, nor do I think that we are asking for the impossible. As the House knows, I have opposed the Northern Ireland policies of the Government over which the Leader of the Opposition presided, but I find myself in entire agreement with the words that he used in the House when he said
  "a very large number of us have been returned in order to maintain the unity of the United Kingdom."—[OFFICIAL REPORT, 29th October, 1974; Vol. 880, c. 64.]
  The 10 United Ulster Unionists, and every true Ulsterman, will heartily welcome that statement. As for Her Majesty's Government and the party opposite, we cannot believe that they would willingly or knowingly set about dismembering the kingdom or betraying the trust which is theirs to hold.
  Since the visit of Mr. Cosgrave last week we have had examples of what is presumably wishful thinking and even attempts to put words into the mouth of the Prime Minister. We, as responsible Members of this House, assume that the Prime Minister will have said nothing

  943
  to the Eire Government which has not been disclosed to the House, and we regard the wording of the Gracious Speech as the authentic Government policy with regard to Northern Ireland.
  Hon. Members of other parties on this side of the House will forgive me if I appear to have left them out of the reckoning, but it seems to me that until we get proportional representation for the whole of the kingdom—some form of Westminster power sharing, and maybe a Scottish Sunningdale—there will be problems over the formation of an administration. But we shall have to be patient.
  The amendment under discussion is relevant to the second part of our manifesto, where we say that
  "we are determined to obtain equality with other parts of the United Kingdom in parliamentary representation."
  In proportion to our population, we have far fewer Members of Parliament to represent us at Westminster than does any other region of the United Kingdom. Our 12 Members represent 1½ million people. Scotland has 71 Members to represent 5 million people. If we had the same scale as Scotland, we should have 21 Members.
  Proposals for the Scottish and Welsh assemblies with no diminution of parliamentary representation here have swept away whatever final justification there may have been for refusing the claim of Northern Ireland to fair and just representation. In common justice that claim can be denied no longer.
  There is no conflict between our claim for parity of representation and our manifesto's third objective—a regional legislature and administration. It is our wish that we should, together with Scotland and Wales, play a full part in reconstructing the constitution and the process of devolution. But we recognise that integration on a Home Counties pattern would not square with the pattern of health, social services and education boards which we have in Northern Ireland or with the new structure of local government, which is already coming under strain because of the direct rule type of administration.
  This brings me to the fourth point of our policy, which deals with the form and the structure of the future of Northern Ireland administration. We say in our manifesto:
  944
  "No Government can be required to include those who reject the existence of the State itself."
  My colleagues and I entirely agree with the wisdom of the advice just given to the House by the hon. Member for Cornwall, North (Mr. Pardoe). It is precisely because the solutions of the past few years flew in the face of minimal political common sense that they, and those who were associated with them, failed and collapsed, because if, as the hon. Member for Cornwall, North said, government is to be acceptable to the governed it must be answerable to the legislature and, through that, to the electorate. There is no other way. This is no less true of Northern Ireland than it is of the United Kingdom as a whole.
  The enforced coalition of parties with widely different aspirations which was imposed under the Northern Ireland Constitution Act 1973 failed to enlist the necessary widespread public support. Indeed, this enforced power sharing achieved the exact opposite and caused overwhelming alienation between the electorate and the executive.
  It is idle to pretend that the experiment proved the workability of such an imposed coalition. The executive merely survived after a fashion and in a kind of sterile incubator where it was insulated and isolated from all the chill winds which normally blow on any democratic Government. It was not exposed and dared not expose itself to the normal pressures and influences which one expects to meet in any form of democratic Government. The wonder of it is that its rejection was not far more violent than it proved to be.
  The task of devising and designing a lasting structure will be the function and job of the constitutional convention which I hope will be set up as soon as possible. There can be no justification for delay. Parliament must not make the mistake of making the task of the constitutional assembly impossible by imposing preconditions which are at variance with British parliamentary standards and practice, otherwise the whole exercise in constitution-making is doomed before it starts.
  The amendment's aim of uniting the nation provides no obstacle to those of us who seek good relations with our neighbours in the south of Ireland. We have said in our manifesto that at all

  945
  times we want good neighbourly relations with the Irish Republic, but the fulfilment of this objective is difficult if not utterly impossible when the Government of the Irish Republic claim sovereignty over Northern Ireland, and when, by neglect, they provide bases from which our part of the territory of the United Kingdom is attacked by violent people.
  Just as damaging to good relations is the failure to hand back and to extradite people who have allegedly committed crimes and who are wanted by the police in Northern Ireland to answer very serious charges. It is the hope of my right hon. and hon. Friends that those in this House, together with Her Majesty's Government, who, quite properly, are eager to promote good relations, will do all in their power to persuade the Irish Government to accept the obligations and responsibilities of a neighbourly and friendly State.
  The plea in our manifesto for the restoration of law and order is again in keeping with the subject of our discussion today. We should have welcomed a specific reference in the Gracious Speech to the urgency of strengthening the regular and reserve police forces in Northern Ireland. We believe that the police ought to be performing a great many of the functions at present being performed by the Army, thereby releasing the soldiers from the burdens which were thrust upon them by decisions to weaken and relegate the police forces to performing inferior rôles.
  In an earlier speech my hon. Friend the Member for Londonderry (Mr. Ross) has stressed the pressing problems of Northern Ireland. I underline the plea that he made and which was reinforced by many hon. Members on both sides of the House, namely, that urgent steps must be taken to rescue the beef producers from certain disaster. If such steps are not taken in the near future, many in this sector of agriculture will be driven into bankruptcy.
  It is a widely-held view in this House that at the last election the electorate in Northern Ireland heard nothing and did nothing about the national issues. That is far from being the case. In our manifesto we said:
  "We recognise the overriding importance of reducing sharply the present intolerable rate of inflation."
  946
  My right hon. Friend the Member for Down, South, perhaps more than any of us, dealt with this issue in speech after speech during his campaign. It may be because of this that he was able to increase his party's hold in his constituency by 8·1 per cent., whereas I, in South Antrim, could do no better than 1·4 per cent. However, as the crisis deepens we pledge ourselves to give our support to measures to control the rise in public expenditure which we regard as one of the main causes of inflation.
  Finally, on many issues, particularly those affecting Northern Ireland, we feel that it is too early to pass judgment. If I may say it without disrespect, we regard the Government as being on probation. I would not, therefore, feel justified in advising my right hon. and hon. Friends to join in a vote of censure at this stage. In days to come we intend to act as a responsible and constructive element in this Parliament, demanding, as we do, that those whom we represent shall be treated as what they are in fact and in right, namely, equal citizens of the United Kingdom. It will be our view of the interests and future of the United Kingdom as a whole by which we shall be guided.
  6.29 p.m.
  Mr. John Mendelson: It is quite natural and deeply understandable that the hon. Member for Antrim, South (Mr. Molyneaux), during a debate on the Queen's Speech, should concentrate on the affairs of Northern Ireland. However, he knows that I have too clear an appreciation of the seriousness of the position there and too much respect for the contributions that are made by representatives of that part of the country to try to make a perfunctory, passing reference to that problem now. Therefore, with respect to him, I propose to return to the economic subject for debate this afternoon, although the hon. Gentleman knows that on other occasions I always try to take part in serious discussions of the affairs of the Province.
  Returning to the economic aspect of the debate on the Queen's Speech, I want to begin with a reference that was made to the Left-wing character of the Queen's Speech and its contents by the hon. and learned Member for Southport (Mr. Percival), who knows that I am amiably

  947
  inclined towards him, in spite of all the hard, idiological words that he says about me from time to time and that I do not mind at all.
  During the long debates on industrial relations legislation, brought forward by one Government or another, we often took part in discussions quite amicably. What I object to is every Opposition Member saying that the country's position is desperately serious and then repeating cheap little propaganda speeches that were made on the hustings. That is what has irritated me.
  If the situation is so serious, surely this ought to be a forward-looking debate. There ought to be an attempt to give advice to Her Majesty's Ministers, to try to direct them constructively into certain policies that might produce some remedy for the citizens of this island.
  How can Opposition Members measure up to their own proposition if they follow it with vague accusations about the Government being lost, the Left wing having triumphed, and all the rest of the rigmarole that is patently nonsensical?
  Mr. Percival: Does the hon. Gentleman accept that, though he may not agree with what I said, my view may none the less be held just as sincerely and put forward just as sincerely, as being a contribution to remedying the situation, as what he is going to say?
  Mr. Mendelson: The sincerity of the hon. and learned Gentleman I have never questioned and never will. I am questioning the intellectual content.
  The point at issue relates to the state of our economic system in what, more than 50 years ago, J. A. Hobson called "the latter stages of capitalism". That is really what this debate is about.
  We are facing a situation—at least some hon. Members will agree with me about this—in which the system does not work. This is typified, more than anything else, by the policy on investment pursued by British entrepreneurs over the past 25 years, It is not a matter that relates to any one particular Government.
  I refer to the speech that was reported in "The Director" as having been made by the right hon. Gentleman the Leader
  948
  of the Opposition in June 1973 on the problem of investment in this country. The right hon. Gentleman then asked managers, employers and industrialists, "Why do you not invest? You said that we must do something about incentives for investment; we have provided them"—this is the Leader of the Opposition, then Prime Minister, at the time speaking—"You talk about doing something to provide possibilities for selling your products later. They are there, so why do you not invest? You talk about doing something to try to limit the rate of inflation. We are doing our best to do that, but still you do not invest". That is the continuing problem.
  I say with great respect to my right hon. Friends in the Government, although we have only had a short time in office, that there are no signs that we are doing any better on this fundamental problem. On the other hand, in spite of all the clamour about the lack of available capital and the difficult attitudes of bank managers, one finds that in Brussels, Hamburg and Paris British capitalists have bought up whole streets and are tearing them down for speculative property purposes. That is where they have plenty of capital. If one goes up and down the country one finds that a number of people have borrowed money at 14 per cent., not in order to invest and improve the stock of capital in this country, but in order to lend the money to somebody else at 16 per cent. and that somebody else has used it for speculative purposes. Those are the real problems of our economy at present.
  These attitudes are not easily remedied. If the right hon. Member for Finchley (Mrs. Thatcher) will forgive me for saying so, I am not one of her carping critics. For one thing, I was once her constituent for eight years and I have always respected her as a good parliamentarian. However, the right hon. Lady did not address herself this afternoon to these key problems either. She was also a little too eager to continue the election campaign.
  I suggest that it does not matter so much now whether the right hon. Lady was partly misunderstood throughout the campaign or only during a part of the campaign. That is humanly understandable: who in politics is not sometimes misunderstood? What matters much

  949
  more is what remedies the right hon. Lady is proposing to the Government at present to tell them what she would do if she were in their place. She completely failed to do anything of the kind this afternoon.
  Anyone who examines the Queen's Speech and its proposals will see what I mean when I talk about the propaganda nonsense of talking about a Left-wing push. Every single proposal has emerged from discussions over the last 25 years. People are raising their hands in horror ever the Industrial Expansion Board as if this were an idea thought up suddenly by some Left wing radical trade unionists in co-operation with some members of the Left of the Parliamentary Labour Party. That is poppycock. It was one of the ideas to which Mr. Gaitskell gave his blessing and that was developed, as my right hon. Friend the Member for Battersea, North (Mr. Jay) will remember well, with his long experience in the party and in the leading circles of the Labour Party in Parliament, and discussed by a number of what the House and its Members would now call very moderate members and leaders of the Labour Party.
  One of the reasons why I am supporting the Queen's Speech tonight is precisely that it is an attempt—I am not at all sure that it will succeed, and so I will put it no higher than that—to improve the nation's economic position by co-operation between people, Government and industry, and by "industry" I mean all industry.
  I think that the Opposition are doing a disservice—and they are not supported by many employers in my part of the country in South Yorkshire, nor, I understand from my colleagues, by employers in the Midlands—in trying to run down the attempt to achieve planning cooperation between the Cabinet and industry. There are quite a number of employers who think that there is a good deal in that idea
  We as a party support the mixed economy, which was mentioned earlier in the debate. This plan makes sense. What is a mixed economy? It is not a static economy. It does not mean that at all times the public sector must remain static. It does not meant that at all times there cannot be new forms of consortia that will do the job of investment, we
  950
  hope, in the future. It means that there can be movement, but we say to the country, "We are dedicated to democracy. We are dedicated to your approval of everything we seek to do. We are dedicated to the principle that if we think that the public sector ought to be advanced in some field we will put a precise proposal before you and only if you approve will we proceed with it, and if you do not approve we will leave it alone."
  That is the essence of having Parliament in the centre of our political life. It is not doing any service to a mixed economy to denounce such proposals without examining them carefully. It is much more important for an Opposition, if they want to be serious about it, to look at a proposal and to argue that it would be wrong to have the aerospace industry publicly owned, and to give the reasons—if they can find any—not to engage in the nonsense of the hon. Member for Henley (Mr. Heseltine) who opened for the Opposition yesterday afternoon, of trying to convince the House that the term "public ownership" had only recently been invented in order to hide the term "nationalisation".
  In 1847, writers on this country's economy on the early Socialist side used the term "public ownership" before they ever used "nationalisation". That is not the level at which we should be debating these serious matters.
  Let us examine the proposal for public ownership of the aerospace industry. Over several years, 73 per cent. of all the money for research and development has been public money. At this stage of the debate, people say "Government money". Of course it is not Government money. There are some old-age pensioners in my constituency who, if they earn a little money in addition to their pension beyond the "disregards" as they are called, immediately have to pay income tax. It is their money that is financing the aerospace industry, not Government money. As far as I am aware, apart from one or two exceptions, my right hon. Friends in the Cabinet have no money worth talking about. This is not the day when one enters the Government as Paymaster-General a poor man and leaves it a millionaire. Those days are past. It is the money of those ladies in my constituency and those

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  in Finchley and elsewhere who finance the aerospace industry.
  Therefore, if that industry is so financed, if it is so closely associated with the nation anyhow, and if there are technically good reasons for doing it, why should we not put a proposal before the people to take it into public ownership?
  Against that—this is the meaning of the mixed economy—most of the major industries remain privately owned. I am certain many will remain privately owned for the rest of my lifetime. It is all nonsense about wanting to introduce State control in all industries and having the country "administered".
  The hon. Member for Cornwall, North (Mr. Pardoe), speaking on behalf of the Liberal Party, fell below the level of the debate when he talked about the loss of freedom in an administered society, and so on. That may be all right during the election campaign, when one has to take an aeroplane, and a train, and rush from one place to another, and when one does not always know what one is to talk about at the next meeting. But it does not do in a debate of this kind.
  Everybody knows that the people who make up this Cabinet are not people who are moving towards an "administered society", whatever that may mean. To create these silly pictures of moving into complete collectivism, when one looks at the mild and bitter collection of the present Cabinet and the Ministers who are directing our affairs, is so much nonsense and poppycock.
  Mr. Pardoe: The hon. Gentleman's understanding of my remarks falls below the level of an intelligent response. I did not suggest that the Government Front Bench or any part of his party, with a possible small exception, were endeavouring to turn us into an administered economy. I made a far more fundamental point, that administered economies east of the Iron Curtain may now be going to win the economic rat race, whereas once we were confident that we would.
  Mr. Mendelson: That was precisely the last but one point that I was moving towards, and the hon. Gentleman has
  952
  moved me on to it. I thought it equally wrong for him to make the exaggerated suggestion about the terrific success story of the Communist economy in the Eastern European countries. Far from it. The Soviet economy at the moment, if it wants to satisfy the 30 million young Russians knocking at the door of officials and demanding a better standard of living now—not in 40 years' time—needs grain from the United States and Canada; it needs the technology of the Federal Republic of Western Germany. Far from having overtaken the other economies, they have done nothing of the kind. No purpose is served, in order to run down the modest attempts of my right hon. Friends, by exaggerating the success story of those other countries. It does not exist. The hon. Gentleman was as wrong on that score as he was on the proposition he has just tried to deny.
  What I believe to be essential is that the Government's policy should be clearly understood as being concerned for the co-operative effort. Perhaps the only point that has not yet been mentioned in the debate today is the one I want to make now. Far from there being too much co-operation in the programme, it may be necessary to do more. It may well be necessary to be selective in the kind of co-operation that we shall have.
  I consider it bad that the Confederation of British Industry should demand £3,000 million to be infused into the private sector. It is bad that the CBI should demand the abandonment of price control, and for it to create the impression among factory workers that we shall move away from what my hon. Friends have been trying to do. It is wrong that the CBI should give the impression that there will be an attempt to let prices rip.
  If we move into a period when prices are let rip, what will trade union members say to their general secretaries and those who negotiate on their behalf? They will tell their representatives that not only must the degree of inflation and price increases which have already taken place be taken into account, but we must look to the next nine or 12 months and safeguard against future increases. In spite of all its lip-service, far from making a contribution to allowing the social contract to have a chance, by the demand for the abolition of price controls the CBI is trying its best to torpedo

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  any hopes we might have of the social contract succeeding.
  That criticism applies equally to the CBI's demand for £3,000 million. I hope that the Government will be firm, and that many Government supporters will see to it that the Government are reminded of the need for firmness. I hope that the Government will be selective in the help provided for individual firms in certain industries. I hope that there will not be a blanket infusion of these large sums of money. The public accountability of each firm must be assured, and the purposes for which Government money is demanded should be carefully examined by my right hon. Friends. I trust that in each case such infusion will be approved only if it can be proved that the purposes for which the money will be spent directly serve the national interest.
  I know, Mr. Speaker, that you wish to call other hon. Members and that I could spoil whatever friendship I may have had with you in the past if I went on any longer. This is a continuing debate, and I hope that, as we examine what my right hon. Friend the Chancellor proposes, we shall find it possible to concentrate on the most serious aspects of the debate and forget the General Election. I hope that we shall do our duty in trying to advise, as well as control, what the Government do. In holding to that purpose we might find much more common ground than has so far appeared in the debate.
  6.48 p.m.
  Mr. Wyn Roberts: The hon. Member for Penistone (Mr. Mendelson) began by referring to the latter stages of capitalism. I am not sure that we are not involved in the latter stages of post-war Socialism and we are about to see its nemesis. However, I shall not pursue that line of thought directly.
  One of our major criticisms of the Queen's Speech is that it does not address itself sufficiently to the major threat of inflation. The Government have defended themselves against that charge by referring to their
  "international efforts to solve the world-wide problem of inflation"
  and by reference to the social contract as
  "an essential element in its strategy for curbing inflation."
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  We are led to believe that there is a two-pronged attack on inflation—one international and the other domestic—and the Government's contention is that we should wait and see the outcome of this attack.
  Meanwhile, we are asked to approve the Gracious Speech as a whole, including those sections of it which will, if and when implemented, involve a considerable increase in public expenditure. The question is: how is such an increase to be financed? Can it be financed without fanning the flames of inflation still further?
  I am trying to understand the Government's thinking on this. The Government are presumably aware of the cost of implementing their proposals, although they are strangely reticent in telling us the cost. The Government are aware of the dangers of inflationary forms of financing. We cannot simply increase the money supply to meet the bill. The money must clearly be raised in ways which will not add to inflation.
  The question is, how? Taxation is already heavy and industry requires relief if high unemployment and bankruptcies are to be avoided. Indeed, this relief is already conceded as a necessity and whatever it amounts to will add to the Government's borrowing requirement—currently estimated at between £4,000 million and £5,000 million. Bank advances and gilt edge stock will undoubtedly contribute. But taking the overall picture, I find it difficult to imagine how the programme outlined in the Queen's Speech can be financed without a significant increase in the money supply—an increase at a time when there are grounds for guarded optimism that international rates of inflation will be reduced. This, then, is the real tragedy of the present situation, that the Government are all set to fan the flames of inflation just when they could be brought under control.
  The Prime Minister told us at the beginning of this debate on Tuesday:
  "Prices are still rising. But they have been rising a good deal less in recent months."— [OFFICIAL REPORT, 29th October 1974; Vol. 880, c. 84.]
  The whole tenor of his argument was that if wage increases could be restrained all would be well. But does

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  wage restraint really depend on the social contract? I am beginning to think that the Secretary of State for Industry was right when he said on 4th October:
  The social contract is not to keep wages down…".
  So far the Government have given every indication of fulfilling their part of the bargain, but the unions have given very little indication that they are prepared to fulfil their part, assuming that that includes wage restraint.
  We are therefore facing a disastrous situation where the Government appear to be determined to go ahead with costly measures likely to be financed by inflationary means and the unions are likely to throw wage restraint to the four winds.
  That is the real prospect before us. Surely we must press the Government to restrain themselves and wait for SJMC clear sign that wage inflation is abating before proceeding to further fulfilment of the contract. That surely is what must happen during the coming months. But I can well understand the difficulties which the Prime Minister will have in forcing some of his Cabinet colleagues—notably the Secretary of State for Industry—to face the reality that if inflation by wrongly-financed public expenditure is piled on to wage inflation it will go hard on the working people of this country, quite apart from everyone else.
  At the same time, it is becoming increasingly apparent that there are those who have a vested interest in increasing inflation by any means whatsoever in order to create chaos from which they hope to derive political benefit. If that is not obvious now, I believe it will become so in the coming months.
  I make no apology for returning to the vexing problems of agriculture and the total inadequacy of the Government's mean and meagre policy. The Minister's speech on Thursday held out very little hope to farmers whom he has left dangling on the end of their bankers' purse strings over the abyss of bankruptcy. I press the Government again to take immediate action.
  I am bound to tell the House and the Government that it was only by all-party action on the part of Members in west and north Wales that we were able over the weekend to appeal to the Welsh far-
  956
  mers to restrain themselves from taking strong protest action which could escalate towards the creation of a violent situation in Wales. It could have been potentially very dangerous indeed, as we have seen from the disturbances in Holyhead and elsewhere last night and today.
  Almost half the country—I do not think we realise this—is involved in these farmers' protests. I am bound to tell the Government that with every import of finished Irish cattle they are importing potential violence to this country They are forcing peaceful people to turn their ploughshares into swords, and they are encouraging people prone to violence who exist in every community to participate in these demonstrations. The Government have deeply alienated the Welsh farmers, and they will suffer for it politically in the years ahead unless they act quickly and show that they have some understanding and sympathy with the plight of small farmers facing bankruptcy.
  I therefore urge the Government to implement the 60-day waiting period for qualification for the slaughter premium without delay—and by that I mean within the next three weeks. The Secretary of State for Wales gave a firm undertaking on Thursday that the Government would consider carefully what had been said about the waiting period. I should like to know from the Government tonight how long we must wait for the outcome of their consideration of this matter.
  If the Government were able to comment on that in the concluding speech it might be helpful to the situation in Wales and elsewhere. I doubt whether the reimposition of the waiting period will be sufficient to establish a floor for the beef market, so I urge the Government to restore the guaranted price for beef and to implement the O'Brien Report as soon as possible.
  The right hon. Member for Anglesey (Mr. Hughes), the hon. Member for Caernarvon (Mr. Wigley) and myself are pledged to pursue these three objects. It is the price we have had to pay on behalf of the Government for comparative peace in our area over the last weekend. If the Government fail us, they must face the consequences for which I, for one, would not like to vouch.

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  Finally, I must say a word on devolution as it affects Wales. Whatever good will the Government may have gained by their promise of further devolution has been lost entirely by their callous and heartless behaviour towards the farmers. The union of England and Wales depends upon mutual understanding, and especially on English understanding of Welsh problems. If devolution is a device to have the problems of Wales dealt with at one remove and to foist upon a Welsh Parliament at Cardiff the kind of odium that this Parliament suffers now, as a result of the Government's inactivity, the Welsh people will soon identify the motive and react accordingly.
  I do not welcome the Government's devolutionary proposals. To me it is mischievious to have a directly-elected assembly which does not have full powers of legislation and taxation. I should have more respect for members of Plaid Cymru if they stood four square behind separatism and spelled out honestly to their electors precisely what that means in sacrifice and proverty, because we in Wales are dependent on the rest of the United Kingdom. Instead, they make increasing demands upon the Treasury and thereby make Wales more rather than less dependent on the United Kingdom.
  It is precisely because I do not believe that the people of Wales are prepared to make the necessary sacrifices for independence that I shall have none of it. We have shared in England's political and economic development for so long—and have as yet no oil revenues to enrich us —that I believe we must maintain the union and Welsh representation as Westminster.
  What will be the point of a directly-elected assembly? It will be primarily a spending body juggling with the total budget allocated by this House, and its main contention will be, as it is with local authorities, that the money allocated to Wales is not enough to meet its needs. Thus, we shall have in the assembly a permanent hothouse for our national sense of grievance. Will that be good for the health of the body politic? No. It will be the beginning of the end of the United Kingdom, the beginning of the undoing of bonds that have taken centuries to forge. To the Government I say, "On your heads be it", and to the Welsh
  958
  nation I say, "Beware of the half truths that will be fed to you".
  To sum up, the Government's thinking on the central issue of inflation is ambivalent to say the least. They have an opportunity of joining other nations to restrain inflation, but they show every sign of succumbing to political pressures to inflame it. My own sympathies are clear—they are with those who wish to restrain inflation by every possible means. If we do not, many people will suffer—ordinary people, low wage earners, pensioners, those on fixed incomes, and so on.
  I have made my plea for the farmers, especially the farmers of Wales who are the backbone of our Welsh life, and I have warned the Government of the dire consequences of ill-treatment of them. I have also told the House of my forebodings about devolution, which I distrust in the form that it is talked about in the Queen's Speech. I beg the Government to think again on these issues and not to march headlong towards the disasters facing us.
  7.2 p.m.
  Mr. Ron Thomas: Thank you, Mr. Speaker, for allowing me to make my maiden speech as part of what I have found to be an interesting and stimulating debate. I should like to thank also the electors of Bristol, North-West for electing me as their Member, and to say one or two things about the constituency.
  Bristol, North-West cannot, of course, be divorced from the city of Bristol. Bristol has always had a balanced economy, but fears are now being expressed that it is becoming more and more a commercial and administrative centre and that the opportunities in engineering and other manufacturing industries are becoming less and less.
  The two main industries in my constituency are docks and aerospace, and I shall refer to them in some depth in a moment.
  I should also like to mention my predecessor, Mr. Martin McLaren, who, although not of the same political persuasion as myself, was held in high regard in the constituency and was well known for his compassion and kindliness.
  I understand that it is a convention of the House that in a maiden speech one should be uncontroversial and neutral. I

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  was once advised that the only neutral people are the dead, and I feel that what I have to say will show that I feel very much alive.
  First, I welcome that part of the Queen's Speech which says that the Government
  "will publish proposals to ensure comprehensive safeguards for employment in the docks."
  The worst features of the casual system have been removed, but there is still the need to strengthen the National Dock Labour Board and continually to examine and extend the definition of what constitutes dock work.
  I regret that the Gracious Speech does not include proposals for the public ownership of the docks industry. In my experience, the present fragmented system means that private stevedoring and shipping companies are able to make demands almost like a form of blackmail, which sets one group of dockers against another. Docks are an integral part of the overall transport system of this country, and there is a real need for national integration and national planning of future development. That can be achieved only under public ownership.
  I welcome also the intention of Her Majesty's Government to take the aircraft industry into public ownership. This is a proposal which commands the support of a majority of the aircraft workers in Bristol, for a number of reasons. First, they cite the amount of public money injected into the industry and the lack of public accountability for that money. I appreciate that other hon. Members have given details of the amount of money involved, but I hope the House will forgive me if I repeat some of the statistics.
  It is generally accepted that over recent years hundreds of millions of pounds of public funds have been injected into the aircraft industry by way of launching aid, research and development and the procurement of military and civil aircraft. In the past 10 years the BAC has received more than £200 million and Rolls-Royce more than £300 million of public financial assistance.
  As well as being the aerospace industry's largest customer, by purchasing approximately two-thirds of its output,
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  the Government have assisted the industry in a number of other ways. For example, development and experimental work under Government contracts in 1973 was almost £150 million. In essence, the bulk of the financial backing for the aerospace industry comes ultimately from public funds. The heavy cost of developing new and more sophisticated projects will depend on constant public financial support, but what is seen to be lacking is public accountability.
  Secondly, rightly or wrongly, there is a fear among aerospace workers that the industry will come under foreign domination and control. It is a threat that they see at three levels. The first is in the demands from many quarters that there ought to be some kind of privately-owned integrated European aerospace industry. The second is in their belief that the Opposition were prepared to sell the engine division of Rolls-Royce to one of the giant American companies, such as Pratt and Witney.
  Thirdly, there is the fear that the industry will enter into all kinds of arrangements and joint developments with foreign firms which are seemingly subject to no kind of public control. This is not to say that they are against those arrangements per se, but there is the belief among aerospace workers that many of these joint ventures have been hastily conceived and motivated by short-term profit-searching at the expense of the long-term future of the industry.
  Fourthly, those who work in the industry insist that in the past there has been wasteful duplication of research, development and production which has inflated the costs of units produced. At the same time, the industry has technological expertise and creativity which has been continually thwarted by inept business decision-making. Often this has meant that technological innovations developed in Britain, backed by public funds, have been more or less handed on a plate to be exploited and become profit creators for private national and multi-national companies. In essence, private ownership of the aerospace industry has failed to create an environment which challenges and develops the full potential of the considerable skill it employs.
  Workers are seen simply as a factor of production, to be utilised as part of

  961
  some remote decision-making process. The numerous projects which have been partially developed and then cancelled in the past two decades have sent periodic waves of optimism and pessimism over the industry, matched by redundant aircraft workers being used more or less as an economic regulator, to be laid off and then taken on again as decisions were, seemingly, gropingly made.
  Few industries have been subject to so many inquiries, reports, debate and the pontification of so many experts. All of these have failed to create a sense of security for those who work in the aerospace industry. There is a rapidly-growing potential market for aerospace products. It is estimated that by the 1980s the value of markets for civil and military aviation in the Western world is likely to exceed £6,000 million, about a third of which could arise in Europe.
  While the exports of the United Kingdom aerospace products are impressive, there has been a considerable decline in our share of world sales of civil aircraft. In my judgment, public ownership of a nationally integrated aerospace industry will provide the centralised and planned demand forecasting and marketing which is absolutely essential. It will end the wasteful duplication of research and development. It will ensure that public expenditure is subject to public accountability. I believe it will give to those who work in the industry a sense of security of employment which private ownership has failed to do.
  I also wish to raise three issues which are of some considerable concern to many Bristol aerospace workers. In my discussions with them over a number of years I have found that they believe that there is a need for a nationally integrated aerospace industry. This must include not only BAC and Hawker-Siddeley Aviation but also Rolls-Royce and Short Brothers and other aerospace companies. They see a case, rightly, in my view, for seriously examining the inclusion, in whole or in part, of a number of the many companies or subsidiaries which are involved in supplying components for final assembly by the major constructors of finished aircraft.
  Secondly, a publicly-owned aerospace industry must be completely free to exploit the market potential for new products and materials, and so on, arising out
  962
  of research and development and the technological fall-out of which the industry can rightly be proud. Thirdly—I believe this to be crucial—while the majority of workers in Bristol support public ownership of their industry, they want to see a form of public ownership different from what we have had in the past. They have set down their proposals, which seek an injection of industrial democracy.
  This is not the kind of wishy-washy window-dressing form of joint consultation advocated in certain quarters—not the sort of wishy-washy joint consultation which in much of British industry means one hour a week arguing about the state of the canteen tea, the toilets, or the car park. It is not the kind of joint consultation which means that employers tell workers what to do. Nor is it the kind of joint consultation which insists finally that the fundamental decisions affecting the lives of working people cannot be jointly resolved because they fall under the heading of so-called managerial prerogative, to be unilaterally decided by the employers.
  The Secretary of State today said that the Government will be looking seriously at the whole question of industrial democracy. I very much hope that this House will be given an early opportunity to discuss the whole question of worker involvement in decision making. If, from these benches, I can make the smallest contribution which pushes forward the frontiers of industrial democracy, I shall be well pleased.
  7.13 p.m.
  Mr. George Reid: It is my happy duty on behalf of the House to congratulate the hon. Member for Bristol, North-West (Mr. Thomas) on a fluent and thoughtful speech. He obviously has a close identification with his constituency and a keen understanding of the problems of the docks and the aerospace industry. We look forward to his contributions in future.
  This debate has proceeded on the general assumption that the economic problems facing the various nations, regions and provinces of the United Kingdom are capable only of solution centrally. The hon. Member for Conway (Mr. Roberts), who, I regret, is no longer

  963
  in the Chamber, worked on the assumption that we should
  "Always keep a hold of Nurse
  For fear of finding something worse."
  He should have considered that within Europe and the Americas there are various nation-States which have devolved power, legislative and economic, to the regions and whose economic performance has been at least as tolerable as that, in recent years, of this country.
  The Secretary of State for Employment touched on this towards the end of his speech when he made a sudden and to my mind rather needless attack on the one Scot in three who voted for a different constitutional relationship within this country. I ask myself "Why?" and the only answer I can adduce is that the economic pendulum within the British Isles is markedly swinging back towards Scotland. Scotland, within three or four years, will potentially be one of the richest parts of Europe. Clearly one of the main objectives of the official Opposition and Government is to hold on to the oil which will be available from Scotland and to muddle through somehow on the strength of that.
  It is not surprising that in this debate I should mention the Scottish election. There is now a profoundly different element in this House as a result of that election. For the first time in 50 years, over 30 per cent. of the people of one of the constituent nations of the United Kingdom voted for root and branch constitutional reform. In 41 Labour seats in Scotland, as Labour Members will be well aware, there are 36 SNP members sitting in second place. If we had a electoral system which did not resemble something more suited to the bingo hall or the betting office the numbers on the respective benches in this House would be different. The Tory rump would be even more ragged and tattered.
  The Under-Secretary of State for Scotland (Mr. Harry Ewing): Has the hon. Gentleman been in favour of electoral reform only since he joined the SNP, or was he in favour of it when he was a member of the Labour Party?
  Mr. Reid: I have always favoured some form of electoral reform, and I still do. The Minister will be aware, the way things are going in Scotland, that it would
  964
  possibly be in the interests of the SNP to continue with the present system, so that we might make even more marked gains in the next election.
  Workers in central London have a weighting allowance to provide a cushion for inflation, but no Government approval or encouragement has been given to a weighting allowance for Glasgow or elsewhere in Scotland, despite the higher cost of fuel, lower wages and high unemployment. A car firm which operates in Scotland and in Coventry currently pays its workers in England £5·50 more than our basic rates. Scottish primary teachers are currently earning £5 less than English primary teachers with inferior qualifications. A firm with branches in Kilmarnock and England pays its workers in Scotland £16 a week less for identical work.
  It is not surprising that a considerable number of people in Scotland are beginning to think not just of a new economic relationship within Scotland but of a new legislative relationship. From now on there is a new Scottish dimension to debates in the House.
  Against that background, it is not surprising that the SNP views the Gracious Speech as a rather hit and miss, sour and sweet, affair as it affects Scotland. We welcome the social measures in the Gracious Speech. We welcome the proposals for the fairer distribution of wealth, and the improvement of social security benefits and family allowances. The Government will have our assistance in the months ahead in encouraging economic growth and a more favourable balance of payments position, and in curbing inflation. But we are profoundly suspicious of the proposals for further nationalisation. We are deeply resentful of the Government's treatment of farmers in Scotland it could lead to the ruination of a great Scottish industry.
  My hon. Friend the Member for Dundee, East (Mr. Wilson) referred to the Government's oil proposals as "the legalised theft of Scotland's national resources". While we as a party are not opposed to nationalisation per se —indeed, in a self-governing Scotland all nationalised industries would remain in public ownership—our Scottish experience of nationalisation is that it is, in effect, centralisation leading to job loss.
  Mr. James Sillars: The hon. Gentleman went into the hypothetical future for a moment and was in an independent Scotland. Surely his argument against the nationalisation of oil would not apply in that context. Will he join me in saying that within an independent Scotland it would be to the enormous benefit of the Scottish people for all oil to be in public ownership?
  Mr. Reid: I do not accept the hon. Gentleman's point completely, although I have a certain degree of sympathy for it. It is a matter for the Scottish people to decide once they have an assembly with appropriate powers.
  Mr. Tam Dalyell: "Legalised theft" is a fairly emotive phrase. If the SNP had its way to whom would the oil belong?
  Mr. Reid: As with coal, the oil would belong to the people of Scotland. It is surprising that the hon. Member for West Lothian (Mr. Dalyell), who arrived in Grangemouth in the middle of the transport dispute and was surprised to see Scottish workers wearing SNP badges, should make such a comment.
  Nationalisation in Scotland means centralisation and job loss. That happened in railway workshops and about 10,000 steel workers in Motherwell and West Scotland are threatened with redundancy over the next decade. Pits in Scotland have had excessive closures compared with pits in the South.
  At the election 100 per cent. of the Scottish people voted for devolution, because every party was in favour of some form of devolution. Almost no one outside the Labour Party ranks voted for more nationalisation, and I suspect that only a minority of Labour supporters did. It is surprising that ideological Socialism should be put before self-government, and that we should have legislation for the National Enterprise Board by Christmas and for State participation in oil by Easter. When are we to have a Bill setting up the Scottish Assembly? Will it be in one year's time, two years' time, sometime or, if the Government do not run their full course, never? The Government's recent handling of the transport and teachers' disputes in Scotland hardly supports the suggestion that they will have speedy determination and purpose in this matter.
  966
  I wish briefly to concentrate on three key devolution issues. The first is the Strathclyde Region, that monster, with half the people of Scotland contained therein. It is only months since the Labour diehards in the Strathclyde Region saw the whole Wheatley reform as a substitute for devolution and used it as an obstacle to devolution. In a sense they were right, because an area such as Strathclyde containing half the Scottish population cannot possibly co-exist with a meaningful Scottish Assembly.
  In time past the Secretary of State for Scotland expressed reservations about Strathclyde, and that is the majority view of hon. Members representing Scottish constituencies. If the Secretary of State had doubts about Strathclyde before a Scottish Assembly became Government policy, how much more grave must his doubts now be? The prime case for Strathclyde was strategic planning. With both the Scottish Development Agency and a Scottish Assembly in the wings, it is sheer folly to press ahead with the establishment of Strathclyde next May.
  We appreciate that the diehards in that part of Scotland are digging in, that a new bureaucracy is being formed with divisive interests, and that vested interests are already there, but if the Government genuinely believe in good government for the Scottish people and in getting it right the first time, surely they will say "Halt" now to the Strathclyde folly. Let us have a moratorium on all local government reform in Scotland till such time as the assembly discussions and the timetable are complete and, at the very least, let us have a declaration of the Government's intention to divide Strathclyde into four constituent parts. That has to be done if the forthcoming assembly is not to exist in a sheer limbo of its own, and it will obviously be much more expensive to delay reform till after the Scottish Assembly is set up.
  We welcome the appointment of the hon. Member for Stirling, Falkirk and Grangemouth (Mr. Ewing) as Under-Secretary of State for Scotland with special responsibility for devolution. He is a man for whom I have the highest regard, and I believe his commitment to devolution to be sincere and genuine. I wish that I could be so sure of all

  967
  his colleagues after the deathbed conversion of many of them this summer.
  There has been much public explanation by Labour Party members on the timescale for devolution, but the Government still have to produce to the House a meaningful and workable timetable for hon. Members to study.
  The Minister of State is quoted in the Sunday Express of 13th October as saying that it is likely to be 1978 before the assembly meets. It may be not even then if Parliament does not run the full term. That was contradicted this week by assurances from other hon. Members that the assembly will be alive and in being in 1976.
  Although there has been havering and dithering further up the tree, the Under-Secretary of State in an interview reported in the Sunday Express on 20th October said:
  "I think we should call it a Parliament. I want it to have extensive powers, extending over trade and industry as well."
  I welcome that statement, which I take to be Government policy, although further confirmation from the Front Bench would be appreciated.
  I have no time to make a detailed examination of the assembly's function, except to say that my party wishes it to have power over the functions of the Departments of Trade, Industry and Employment; over the nationalised industries in Scotland and over the rate of extraction and exploitation of oil. In the early stages it must also have some revenue-raising powers of its own.
  One of the welcome things about the present Parliament is that there is a cross-party consensus in terms of the Scottish dimension. If hon. Members will read the useful memorandum issued last summer by the hon. Members for South Ayrshire (Mr. Sillars), Stirling, Falkirk and Grangemouth, and Paisley (Mr. Robertson), entitled "Devolution within the United Kingdom", they will see a lot of common thinking between them and ourselves—and possibly some of the Liberals too. It is only a first step, but at least it is a step in the right direction.
  My third point relates to the European connection. Hon. Members will have noted that there is a great difference between devolution within the United Kingdom, and the situation as it would affect
  968
  a Scottish Assembly sitting in the context of the EEC. The SNP is opposed to centralism either here or in Brussels. It is fundamental that the Treaty of Accession and the Treaty of Rome should be rewritten. If not. we shall continue to say "No" to the EEC. It is all up to the renegotiating team. My impression is that they will go down in history as the gentlemen who in the mid-'sixties almost took us into Europe and who in the mid-'seventies almost took us out again.
  I have a great deal of sympathy with the hon. Member for South Ayrshire in wishing at such a stage to withdraw from this House and to seek separate representation for the Scottish people similar to the representation of the Danish people, the Southern Irish and the Belgians in the Common Market. I believe that the present Government should consider publishing any future referendum on the EEC separately for Scotland so that we may see what the separate Scottish vote is.
  Mr. D. E. Thomas: I hope that the hon. Gentleman will allow me to add that the Government should also publish a separate list for Wales.
  Mr. Gerard Fitt: Do not forget Northern Ireland.
  Mr. Reid: Indeed, separate lists for each.
  Finally, there have been various queries about what the Scottish National Party stands for. We are a democratic party, pledged to achieve social justice and equality for the people of Scotland. The hon. Member for Renfrewshire, West (Mr. Buchan) asked in the debate last week whether we would sit in the assembly and make it work. Of course we would make it work. But the hon. Gentleman must not think of devolution as being a static, once-for-all, fixed, immutable change. Devolution is a continuing process, and when the Scottish people say "Enough". that will be enough for me. We should remember that it is not this House which will decide Scotland's future, but the people of Scotland at the polls.
  The hon. Member for Renfrewshire, West, referring to our common nationality, spoke of
  "…the little white rose of Scotland, That smells sharp and sweet and breaks the heart".—[OFFICJAL REPORT, 30th October, 1974; Vol. 880, c. 319.]

  969
  May I remind him of two other lines from Hugh McDiarmid:
  "For we have faith in Scotland's hidden powers.
  The past and present's theirs, the future's ours."
  7.33 p.m.
  Mr. Bruce Douglas-Mann: I join in congratulating my hon. Friend for Bristol, North-West (Mr. Thomas) on an excellent maiden speech. I am not an expert on the aerospace industry, but from what I know of nationalisation I agree with my hon. Friend about the changes that need to be made when we are bringing industries into public ownership to ensure that our objective is met.
  I shall not take up the remarks made by the hon. Member for Clackmannan and East Stirlingshire (Mr. Reid) and no doubt many of my Scottish colleagues will wish to deal with them. I hope that I shall not appear to be suggesting proposals which on the face of them are disadvantageous to anybody's constituency. The reason I put forward these proposals is that we now face a situation far graver than most of us at present realise.
  I was in agreement with a great deal of the speech of my right hon. Friend the Member for Battersea, North (Mr. Jay) except when he said that he did not consider that we were in a state of extreme crisis. It has been generally common ground in this debate that the present economic situation approaches disaster levels. It is not generally understood how grave is the disaster.
  My right hon. Friend said that at present our deficits were equivalent to 6 per cent. of GNP which is 50 per cent. worse than the situation in 1948. What he did not mention was the appalling size of our deficit on oil and petroleum. In the third quarter of 1974 our trade deficit on petroleum and petroleum products averaged £303 million per month, equivalent to an annual rate of over £3,600 million. We have become so accustomed to large figures that they do not always register to the extent they should. In grasping the enormity of that figure, it helps to relate it to the value of the equity shares in all the United Kingdom companies quoted on the Stock Exchange. At present the value of the
  970
  whole of the equity shares in all the major companies in Britain—the banks and insurance companies, all our major commerce and property companies—at current share prices is about £20,000 million. At the rate of £3,600 million a year, the rate of our deficit on oil is a little over one-sixth of that figure. At that rate it will take a little under three years for a deficit of that size to become equivalent to a controlling 51 per cent. interest in the whole of British industry and commerce. I am assuming that prices stay the same, which is perhaps an unrealistic assumption because share prices would rise as the Arabs started to buy. But six months at this rate would involve a substantial transfer, if we were to succeed in transferring the proceeds of oil revenues into long-term investment rather than into seven-day hot money, which is more dangerous to the economy than is long-term investment. And it would still not take very long for our entire economy to become a wholly-owned subsidiary of the oil-producing countries.
  We are sitting here in the House of Commons discussing economic matters in a building which is extravagantly heated, no doubt by oil, and having driven here in our cars, the petrol for which not only is not rationed but is actually cheaper than it was a few months ago. We should be taking emergency measures to conserve energy. Petrol rationing and the restoration of the 50 mph speed limits would be only the start. A subsidy for the thermal insulation of existing homes and stricter thermal insulation standards in the building regulations can save significant amounts of energy. Forty per cent. of all our energy goes on home heating. Further savings can be achieved by implementing the suggestions made in the editorials in The Times and the Guardian on 24th October.
  In addition, we must develop our own resources of coal and oil. I am, by conviction, a strong believer in the conservation of resources. But I accept that in the immediate future we must use our resources and make them available as fast as possible to preserve our economic independence. But neither short-term energy saving nor the using up of our own mineral resources will enable us to carry on with the economic pattern to which we are all accustomed.

  971
  The principal point I wish to make is that if we are to overcome all the major problems we face, they will require the same kind of measures. We have our immediate economic difficulties; we also face social problems of bad housing, deteriorating public services, the near collapse of the National Health Service, and a worsening public transport situation. On top of all this we have the world problem of dwindling mineral and other resources—and, even greater, is the world problem of rising population and the danger of world starvation. All these problems point to the need for austerity in the rich countries—starting now. We need to shift the emphasis of our economy away from the private consumption of goods towards better communal facilities—better public services. We need more repairs, less replacements.
  I believe that we can preserve our economic independence, maintain full employment and achieve a more satisfying way of life by adopting some of the measures which we used during the war and in the immediate post-war period. I am not suggesting any sudden, drastic change, but a recognition that changes in the pattern of our economy must come. We can start to pave the way for them by taking measures which will enable them to be carried into effect relatively painlessly and at the same time ensure full employment.
  We need to cut into private consumption. The report published on Sunday by Friends of the Earth quoted figures from the 1973 National Food Survey which suggested that the average protein intake in Britain was almost a quarter higher than the recommended level. We can cut meat consumption by 38 per cent., it is suggested, and almost certainly be healthier for it. The report estimates that that alone would save £715 million a year on our balance of payments. But, more important, it would release food supplies to those who need them more desperately than we do.
  I would welcome the rationing of meat. I suggest not that we should go back to post-war levels but that there should be some curtailment of consumption. It would do us no harm. Meat is the most wasteful form of protein because the calorie intake of the animal is 10 times
  972
  greater than its output. The grain resources involved could then be released to those parts of the world where there is the most desperate need for them.
  The packaging of goods is a wasteful manner of consumption. We spend over £1,000 million a year on the packaging of goods, a great deal of which is unnecessary. It is a useless waste of the product because we get too much in the packaging. Indeed, the old-age pensioner cannot buy the small quantities that he or she needs.
  We have developed an entire economic system which appears to depend for its survival on using more of the world's resources in an increasingly wasteful fashion. We have now reached the point where the world cannot go on supplying the raw materials to sustain that way of life, where we can no longer afford to pay for them, and where the material rewards for those who work in manufacturing throw-away goods are so much greater than for those who provide services that we can get nothing repaired and our public transport, postal, refuse, educational and health services are collapsing.
  Meanwhile, one-fifth of the world's population, as we are reminded this morning with the report of the opening of the World Food Conference in Rome, is facing the immediate threat of famine. The clear message from the United Nations Bucharest Conference on World Population is that a reduction in the disparities between the living standards of the rich and of the poor world is an essential precondition of getting the world population explosion under control.
  I believe that we can resolve all these problems, including those of world population and food supplies, while at the same time giving ourselves what will in many ways be a more satisfactory way of life and maintaining full employment. That remedy necessarily entails a reduction in the level of personal consumption of private goods in the rich countries, but much of that reduction will be more than adequately compensated for by improved housing and public services.
  I have spoken of the rationing of petrol and meat. I believe that we need to do much more than that. We should be encouraging our own agriculture industry to produce more and to use more

  973
  marginal land. I should like to see a new "Dig for Victory" campaign with greater emphasis on the use of the allotment system. But none of these things will be enough.
  I hope that when the Chancellor of the Exchequer presents his Budget, either next week or at least in the spring, we shall get differential rates of corporation tax—higher on high resources-using industries and lower on those which contribute to conservation, resource and import saving through repairs and recycling. We need a reverse selective employment tax. That tax discriminated against services to balance purchase tax. With VAT at a universal standard rate of 8 per cent. the bias in favour of the production of goods rather than services is far too wide. Differential rates of VAT would be an alternative or supplementary way of achieving the same objective.
  I should like to see experiments in the use of time-graded car taxation envisaged in the Labour Party publication, "The Politics of the Environment." This would discourage built-in obsolescence and wastefulness of materials which is such a characteristic of so many manufacturing industries. I should like to see that idea applied to other goods. It is easier to apply it to cars because they have an annual rate of tax. However, I believe that it could be extended to television sets and possibly to other durable and semi-durable goods. At the same time we can and should subsidise recycling by local authorities and give tax concessions to private companies which conserve their surplus heat or recycle their other waste.
  Simultaneously, we must cut into consumption by higher personal taxation. We should also consider reversion to the compulsory savings system which has been instituted in Australia and of which we had experience with post-war credits. They were unpopular in Britain because we were unable to make them genuinely post-war credits. However, no one can be sure that we are providing adequately for retirement or for the risk of misfortune. A form of compulsory saving is a valuable method of cutting into consumption in this situation.
  All these measures will, by cutting into consumption, inevitably affect the employment situation. I do not by any means share the view of either Professor Beckerman in the New Statesman last
  974
  week or the right hon. Member for Leeds, North-East (Sir K. Joseph) that unemployment is, if not inevitable, at least a subject that we should be discussing and making plans to create. I think it is impossible to look at the social situation without recognising that, although we do not need unemployment, we need the redeployment of employment to maintain essential public services particularly in our cities.
  There would, of course, be understandable and legitimate objections from both sides of industry to the changes which I am advocating. If these changes were not necessary those objections might be insuperable. But when survival is at stake—I am talking not only of the survival of our economic independence, or even of our democratic institutions, which many of us recognised during the election were at risk, or the social machinery for urban life, but the survival of the human race in a situation where world starvation is a real threat—those objections must be overcome.
  I believe that the understandable and natural objections to the changes in the pattern of our economy to which we are accustomed have to be overcome. I believe that they can be overcome. However, to do so we must accompany all our changes by social justice on a scale which we have not so far contemplated and which is not envisaged in the Gracious Speech. The danger is that conventional economic wisdom, at a time of low business confidence, will lead to cuts in taxation and reductions in the quality and scale of our public services.
  We need the reverse. We must cut into private consumption by higher personal taxation, but we must ensure that improved public services of all kinds replace the demand for labour which a decline in demand for the products of manufacturing industry will generate. We should, if necessary, control imports of manufactured goods, particularly from the developed countries. We must spend more on retraining, give better redundancy payments and ensure that the burden of the changes that must come about is not borne by those who are thrown or who are liable to be thrown out of work as a result.
  The changes that I am advocating require an acceptance of some degree of austerity. That austerity must start at

  975
  the top. To resolve our problems, however, it must extend a long way down. The bottom 25 per cent. of society lives very austerely now compared with the standards of the developed world. We do not need austerity there. Most of the rest of us can afford more austerity than we have.
  The changes that I am advocating are, I admit, fundamental. I am calling not for sudden or drastic changes but for a start to be made on changes which had to come. They can only be carried out in a community which is determined to achieve a far higher standard of social justice than we have yet envisaged. But if we fail to make a start now, we shall not only be continuing on the course which leads to the exhaustion of world resources and the danger of world starvation and in time the collapse of our social and community services; we shall also in a short time become an economic colony of the most reactionary ruler in the world.
  Several Hon. Members rose—
  Mr. Deputy Speaker (Mr. Oscar Murton): Order. Before I call the next speaker, may I remind the House that time is moving on and that several hon. Members still desire to take part in this debate? Brevity would be very helpful.
  7.51 p.m.
  Mr. Tim Renton (Mid-Sussex): I listened to the speech of the hon. Member for Mitcham and Morden (Mr. Douglas-Mann) with a great deal of sympathy and agreement, particularly when, at the beginning, he referred to this country approaching disaster, and he said that this had not been generally recognised. We in this House have paid lip service to this, but we have not fully taken account of the gravity of the situation. I have listened to the speeches from the Government Front Bench today and yesterday with a mounting sense of depression. A simple question has never been answered by Ministers—why do they feel that doctrinaire measures of nationalisation of land and extension of State control into industry will help to get Britain out of the industrial crisis which faces us? No answer has been given.
  Today, it was the turn of the D'Artagnan of the Cabinet, the Secretary of State for Employment, full of sound
  976
  and fury, signifying nothing. Yesterday, we heard the Secretaries of State for Industry and Energy, the Athos and Porthos of this administration. Only Aramis, the Secretary of State for Trade, has not been with us. Like the Four Musketeers, they are full of swashbuckle and devoid of common sense. Behind them all the time is their Cardinal Mazarin, the Chancellor of the Duchy of Lancaster, wondering where on earth the money will come from to pay for the proposals that these four right hon. Gentlemen are advancing.
  Will the cost of their proposals be £4,000 million, £5,000 million or £6,000 million? We have not been told. It is significant that, yesterday, for the first time, the Financial Times decided to refer to figures of thousands of millions of pounds as "billions", because it saved a good deal of space. We shall hear a lot more about thousands of millions of pounds in the coming weeks and months as a result of Government expenditure.
  Suppose for a moment that the figure is £5,000 million that the Secretaries of State for Industry, Energy and the Environment will spend. The interest on that sum alone, at 17 per cent.—the current yield on long-dated Government stock—will be about £850 million a year. I very much doubt whether the return, the profit, from all the industries that the Government propose to take over will be sufficient just to cover that interest.
  The hon. Member for Penistone (Mr. Mendelson), who unfortunately has left the Chamber, complained that in this debate none of us had made enough positive suggestions to Ministers about what they should do. I therefore propose to do just that and to concentrate on one simple issue. I would say to the Government—get off the back of industry, both nationalised and private, and let it get on with its job.
  I have a great deal of sympathy with the management of nationalised industries today. In many areas—in the electricity generating stations, for example—they are extremely cost-conscious; managers there are very aware and acute in switching from one energy source to another at very short notice to save a few thousand pounds. Perhaps £10,000 or £20,000 is saved in a day at an individual power station in that way. Then the Government of the day suppress a

  977
  price rise, and the result is a loss of millions of pounds to the CEGB. How depressing and demoralising that must be for the management in the nationalised industries. It is, of course, these losses of millions of pounds that hit the headlines, whereas their energy and effort in saving a few thousands goes for naught and is not mentioned.
  Not being allowed to charge the economic price for one's product is totally destructive for management in the nationalised industries. The corollary to this is that charging a non-economic price for coal, steel or rail transport leads to many wrong investment decisions both by producers and by consumers of the products of those industries. We are rapidly reaching the point at which it will be impossible for any Government to put up the prices of gas, electricity or the postal service to an economic level, because such an increase is needed that it will be unacceptable to the customers in an inflationary age.
  As a result of Government intervention, the nationalised industries are becoming doomed to the same fate as British agriculture—that of providing a vitally necessary service but at an uneconomic price, thanks to the interference of Government.
  The nationalised industries suffer from an incompatibility of objective. First, they exist to provide a social service in which some Government interference is inevitable, but, secondly, they should provide a reasonable return on their capital employed. The two objectives have become hopelessly confused.
  I suggest to this Government that they should not forget the second objective, because to do so is demoralising for the salaried management and for the work force of those industries, and in the end leads to the wrong investment decisions being taken. I have been told that in British Rail, one railroad was kept open, in order to provide a social service, at a cost—a subsidy—of 19p per passenger mile. It would have been cheaper for British Rail to buy a Mini for each passenger who used the line. What a way to run a railroad!
  When a nationalised industry is required to keep open a railroad or to provide a telegram service, at an uneconomic cost to it, surely this should be properly costed out, and the industry
  978
  involved should receive a subsidy from the appropriate Government Department directly equal to the cost borne by the industry as a result of the departmental request. That subsidy would be taken into the books of the nationalised industry at regular intervals, and having received the subsidy the industry should then be run on a commercial basis and its management, its work force, its board and its chairman judged accordingly.
  The Government must agree with each nationalised industry an investment programme for five or 10 years ahead and, having agreed that programme, exercise the utmost restraint on itself, its civil servants and its politicians in not interfering. The Secretary of State for Industry is very much in favour of planning agreements, as he made clear yesterday. Until I see the details of his proposals, I shall hold back judgment, but I should like to refer him to the French example. For 30 years now, the French have had five-year plans and have had more success in running a mixed economy than any other country in Western democratic Europe. This is shown by their rate of growth from a very low base in the mid-1950s.
  It is therefore relevant for us to study French experience. In this context. I refer the Secretary of State to an article that appeared in the Revue Economique in July 1970. It is in French, but no doubt the Members of the European Liaison Committee could translate it for him if he finds that difficult. The point that comes through this report time and again is that the French Government have found that, first, they asked for far too much detail from industry, and that industry got bogged down in paperwork, most of which was never used and which ended up in the mental wastepaper basket. The article says:
  "Too much daily intervention by the State led either to achievement of ends that no one had chosen or else failure to achieve any end whatsoever because of total lack of coherence."
  The French decision—they are very conscious of this as they now work towards the preparation of their seventh plan, which starts next year—is that they have moved away from dirigiste centralised direction to the use of persuasion, rather than constraint, in order to let industry, including the industries in which the State has a stake, get on with its job.

  979
  The final and specific example of this that I wish to mention is that the French Government have no financial participation in steel companies but are directly involved in much of the industry's future development and planning. This government influence was shown in the French Government's decision to build the new steelworks at Fosse, in the development area near Marseilles, rather than at Le Havre. In 1966 a general State and industry agreement was reached which governed structural reorganisation of the French steel industry, State participation in the financing of investment programmes and social measures aimed at problems caused by a reduction in manpower.
  A loan of £205 million at a subsidised rate was provided as part of this general agreement with the French Government. Four years later the agreement expired. All the funds available had been allocated but the objectives of the programme had, if anything, been exceeded, because the total capacity of steel production had been raised by more than the plan had originally envisaged. It was then decided by the French Government and industry together that although the rationalisation of the industry was a continuing process, industry had now been given a sound structural basis and there was no need for renewal of that State agreement.
  Surely it is on such a basis, and on such a basis alone, that the State can and should work in both nationalised industries and private enterprise. The State should be there as an equal partner, but there should be the minimum amount of State intervention compatible with the proper use of the funds provided by the State and with the achievement of the social objectives that the country may require.
  In speaking in this debate on the Gracious Speech last Tuesday, the Prime Minister quoted an example from Mr. Harold Macmillan. I should like to remind the Prime Minister of another saying of Harold Macmillan:
  "People walk in public gardens; they cultivate their own."
  We all want to achieve a vigorous and profitable industry in this country. The only way to do this is to encourage people to cultivate their own gardens. Turn those gardens into public parks and people will walk and stroll in them, but
  980
  they will not dig or sow or reap a profitable harvest.
  8.4 p.m.
  Mr. Robert Kilroy-Silk: I listened with great interest to the hon. Member for Mid-Sussex (Mr. Renton), who demonstrated in his closing remarks a total lack of knowledge of many of the people who live in our major cities. They do not have gardens. He also said that one of the things which had been lacking from the debate had been constructive proposals. They have been lacking all right—but from the Opposition side of the House. When the hon. Gentleman came to suggest what should be done to get us out of what he called the pressing economic crisis, the only suggestion he could put forward was that the Government should get off industry's back. The problem is that industry, for the past seven months, has been on the Government's back. There has been no lack of industrialists queuing up at the Department of Industry asking for Government subsidies and loans.
  I welcome the opportunity to support the proposals in the Gracious Speech to introduce planning agreements and the National Enterprise Board, and to extend public ownership. The proposals are relevant to our needs, modest in their scope and necessary to improve the performance of British industry and to develop channels of communication between industry and the Government.
  These proposals will be particularly welcomed by my constituents in that part of my constituency called Kirkby. The hon. Member for Mid-Sussex mentioned how depressed the managements of nationalised industries were likely to be every time they found themselves with a deficit. I can tell him that my constituents in Kirkby are depressed and oppressed by the irrationality and capriciousness of an economic system that pays no regard to their livelihoods or their jobs. They have long suffered at the hands of an industry that has no regard for and has shown a total neglect of their interests. Indeed, the employment situation in Kirkby today is a graphic illustration of the failure of private enterprise and of the need for the measures that are outlined in the Gracious Speech.
  The people of Kirkby are skilled, hard working and conscientious. They have a

  981
  vast new industrial estate. Many of the factories there were built very largely as the result of Government grants and subsidies, yet today in that town there are 4,000 men and women who are unemployed. Many school leavers are unemployed. That figure of 4,000 is from a total adult population of about 30,000. At the same time as some factories there have closed, many others have announced redundancies, the majority are working under capacity, and we have the lack of availability of employment for men and women who are willing and able to work in my constituency, we have over-full employment in parts of the South-East. It is an ironic, irrational situation that there should be a blight on the lives, livelihoods and career prospects of my constituents at one and the same time as firms in the South-East go to Malta to recruit workers.
  Is that not a graphic enough demonstration of the injustice and irrationality of our economic system? Would not anyone with any common sense, standing back from this situation, seeing the congestion and competition for jobs in one area and the lack of employment opportunities in another, wish to shunt resources and facilities from one area to the other? Yet that cannot be done under a private enterprise system, in which profit and the pursuit of profit is the only objective. People count, and people are far more important and count for far more than money or profit.
  We do not need statistics or arguments to prove our case. Kirkby's employment situation is a manifest indication of the irrationality, injustice and inefficiency of the private enterprise system. That is why we welcome the proposals for greater Government intervention in industry. The case for greater Government intervention in industry rests, first, on the intrinsic merits of the proposal and, secondly, on the failure of large sectors of private industry.
  What are the proposals for planning agreements that hon. Members opposite seem to make so much hysterical fuss about? No more is proposed than that the Government will consult leading companies in an attempt to harmonise their objectives with the national interest. It is an attempt to set out the aims and the purposes both of industry and of the Government to make industry aware of
  982
  the Government's objectives and for the Government to become informed of industry's problems and proposals. Is there anything wrong or Draconian about that? Alfred Herbert does not seem to think so.
  We have heard a great deal about the lack of liquidity of private enterprise. The National Enterprise Board is specifically designed to overcome that type of problem, to channel funds into industries and companies that are in difficulties; to channel funds, too, into those which are not in difficulties in order to give the community a stake in those enterprises.
  Is it not then reasonable, when public money is invested in enterprises, that the public should take a share of the equity? I cannot see anything that should provoke the hysterical rantings of many hon. Members opposite, nor can I see anything unreasonable in those proposals and the proposals for the extension of public ownership into the aerospace industry and the shipbuilding and ship repairing industries. The arguments for those have been well demonstrated in the past and with particular reference to shipbuilding have been demonstrated by its failure of investment, by its reduced export orders, by its low productivity and its low pay in that industry.
  Yet the only response that we get from Opposition Members is, "What is the cost?" Many hon. Members have made that point today. It is interesting that they never question the cost of the £3,000 million lent to private industry. They never bleat hysterically when a private enterprise company comes along to the Secretary of State for Industry and asks for a hand out. We hear no complaints from that side of the House then. It is interesting, too, that they never once question the cost of the anti-Labour propaganda peddled by companies that are allegedly short of cash. Never do we hear any question about the cost of those proposals from hon. Members opposite.
  But the Opopsition have a right to ask where the money will come from, and we should tell them. It will come from the same place that all the money came from that has been dribbled out to private industry in the past few years without any strings or any qualifications. It will come, of course, as they well

  983
  know, from the Exchequer. "Ah!" they will say, "but what of the cost to the taxpayer?" And that is a fair point. But what we have to counter it with is the cost —and this, surely, is the real question—to the workers of this country, of industries with low investment, with low productivity and a low back-up of capital equipment per man and with low pay and poor working conditions. We have to ask ourselves what is the cost to the country of an inefficient and investment-shy private enterprise system. The cost has been enormous, and it is a cost that we are not prepared to tolerate.
  The costs have been demonstrated time and again, and not one hon. Member on the benches opposite has been able to counter the argument that because of poor investment in British manufacturing industry there is less in terms of equipment behind each worker than there is in France, the United States and, indeed, in the countries of most of our competitors.
  The classic example is Alfred Herbert. This was always held up as one of the prime cases of entrepreneurial skills and initiatives. Yet that company cannot raise the finance that it requires from the City. With its prospects, its track record and its future it is still unable to provide proper finance for itself from the normal financial institutions. They are too much inclined to invest abroad, and far too interested in investing in property and property speculation rather than backing British industry.
  It also, in the case of Alfred Herbert, demonstrates not only that additional finance, and finance through the Government, is needed, but it demonstrates that private industry is both willing and able to work with Government under the system of planning agreements in spite of all the forebodings and the warnings of disaster that have been peddled from the benches opposite.
  No one now questions whether the Government should intervene in industry. The only question now is the form that that intervention should take. We on this side of the House do not believe that help should be given without strings or qualifications. We believe—indeed, we insist—that industry should be made to serve the community and should be
  984
  accountable to it. When the Government provide financial assistance to industry, then is it not reasonable to ask what the community will get in return? Hon. Members opposite seem to think that when a firm has paid its taxes it has discharged its duty to the community. That is not so. It has a duty also to provide jobs. It has a duty, too, to the regions. It has a duty to increase exports and to raise living standards.
  It has, moreover, a duty to the workers that are employed in its enterprises. They, too, have invested their skills, and in many cases their lives, in the future prosperity of a particular enterprise, and they, too, are owed an obligation to be more fully involved in all the activities and the plans of that enterprise. It is these duties that private enterprise has shown itself incapable of fulfilling. It has shown itself incapable of having a proper regard for its workers and showing a social conscience. It has failed to carry out these duties. We shall help it to ensure that they are fulfilled in the future.
  8.17 p.m.
  Mr. Dafydd Wigley: It is a great pleasure to see you returning to the Chair, Mr. Deputy Speaker, as I catch your eye after a long wait. I thought I should not see you coming to the Chair yesterday or today—
  Mr. Deputy Speaker (Mr. George Thomas): Order. Let there be no misapprehensions in the House. I have inherited a list and I appeal for short speeches or the other hon. Members will be disappointed.
  Mr. Wigley: I take note of what you say, Mr. Deputy Speaker. May I first join in the compliments that have been paid by others to the maiden speakers today? We have had a number of excellent speeches.
  There is one speech that stays in my mind particularly, that of the hon. Member for Southampton, Test (Mr. Gould), who spoke on housing and who made an excellent speech. It is interesting to note how housing problems arise in so many constituencies of different characteristics. In Southampton, in our great urban areas and in places such as my own constituency, Caernarvon, the problem is the same and it is a problem that must be attacked with vigour.

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  I was glad to see the reference to housing in the Gracious Speech and I hope that the action by the Government will be vigorous.
  Perhaps it is not what the Gracious Speech specifies but what it does not specify that catches the eye; and of what is mentioned, perhaps not enough is said. On most of its content, therefore, we shall wait until the measures come up before we pass judgment.
  Yesterday—and again today—we debated economic aspects, and prior to that we debated agricultural and constitutional matters. Before I deal with the economic aspect I must make reference to the constitution. There is no commitment in the Gracious Speech to legislate on devolution, and this is something that we regret. We feel that there has been enough time for debate. It is a year since the Kilbrandon Report appeared, and that was after five years of work. Before the February election the Labour Party was committed to a Welsh Assembly, and therefore the Government are confident enough of their facts.
  A full-time constitutional adviser has been working on the matter since the February election. We may well ask, "Where is he now?", or, perhaps more to the point, "Why is not he in his job now?" The answer is that he has been transferred to another rôle in another place, and some of us fear that may have an implication—either his ideas were going ahead too quickly, or they were too radical. We shall wait to find out when the Government bring in their legislation. We wish good luck to the hon. Member for The Wrekin (Mr. Fowler) in his new job, and also to the hon. Member for Merthyr Tydfil (Mr. Rowlands) with his shared function.
  A White Paper on this matter came out in September, following a discussion document in June, and the impression that we had from discussions with Lord Crowther-Hunt was that it was practical to get legislation not only into but through the House within 12 months, yet now we find that there is a delay, and that is disappointing.
  Another aspect of vital importance to my constituency and to many other parts of Wales is agriculture. Agriculture is the economic bastion of my part of Wales, and there is a catastrophe afoot for the
  986
  beef farmers of North-West Wales, South-West Wales and, no doubt, parts of England as well. It is a catastrophe of the greatest proportion. We shall find farmers going to the wall in hundreds, and there will be bankruptcies before Christmas. We were told by the Minister of Agriculture last Thursday that a solution would be forthcoming after renegotiation next March. Next March is too late for the farmers in my constituency —they will be out of work by Christmas.
  This is a problem not only for the farmers in my constituency. The cattle are starving today, and tomorrow it may be the farmers, but next year it will be the population of the urban areas who will be starving. It is ironic to think that tomorrow the Minister of Agriculture will be in Rome for a conference on food, and yet we have a threat to the supply of food in our own country.
  I implore the Government to take immediate action on this problem. We agree that the demonstrations that take place are dangerous, and we would much rather see action taken following a less dramatic way of drawing attention to the problems. But the problems are so dire that the farmers, who are normally so reluctant to take this sort of step, are taking the most extreme steps that we have seen in Wales for many years.
  I implore the Minister of Agriculture to think again about reintroducing the 60-day waiting period for Irish imports, to pay attention to the O'Brien Report as a matter of priority and thereby facilitate the export of beef to European countries, and, more than anything, to bring in a guaranteed price for beef at, say, £22 per cwt. that would give some floor to the market.
  As a short-term measure, is it not possible for the Government to do in agriculture what it was possible to do in housing when they aided mortgage funds? Is it not possible to have a loan fund in agriculture to bail out the young farmers? It is particularly the young farmers who are being hit now, with interest rates at such a high level. If this is not done, we shall have a crisis of enormous proportions in the rural areas.
  Hon. Members may accuse us of being cynical, but I was interested to hear the hon. Member for Conway (Mr. Roberts) say earlier that people in Wales will feel

  987
  that they cannot get the ear of the Government on this matter unless there is action. It is inevitable that they are then going to look for a system of Government that can give time, attention and a hearing to their problems. If the Minister wants to do something very early, perhaps he could find time—immediately after he returns from Rome—to go with the Secretary of State for Wales to Bangor and Fishguard and see the problems for himself and meet the farmers' leaders.
  I turn to another aspect of the Gracious Speech. We welcome the announcement of a development agency for Wales. This is something for which people of Wales have been pressing for almost 30 years. I think it was in 1946 that a pamphlet came out on an economic development corporation for Wales. It is interesting to note that that pamphlet called for an agency which would be a public corporation set up by an Act of Parliament. That seems to be something that we have in this Gracious Speech. It would be an agency to organise the basic services, the utilities, transport and technical education, to generate industrial development—an agency with sufficient flexibility to get to grips with the employment and economic problems of Wales.
  It is too early to see exactly how this agency will function, but we look forward to getting the flesh on the bones, to see whether this is the sort of agency which we require in Wales, which can get to grips with these problems.
  We were interested to hear the Secretary of State for Industry yesterday say that the activities of the NEB would be completely decentralised, so that the agency in Wales would have the maximum scope for functioning in our country. If that is the case, there is hope for this to be an effective body, which can work side by side with the NEB in England and a similar agency in Scotland.
  It must be a development agency that can attract industry to Wales from outside, as well as help people in Wales set up industry. It must be an agency that can initiate industry for itself where the private sector fails to do so, and one that can co-ordinate existing industrial development. It must have power to do these things and it must, above all, be answerable. That is where it fits into the logic of having an elected assembly for
  988
  Wales. I hope that this national development agency will be the industrial arm of the Welsh Assembly when that comes to fruition. We look for a body that will show enterprise in trying to solve the economic problems of Wales.
  The agency has a tremendous amount of work to do. There are a number of problems in Wales, but we feel convinced that, provided that it is given sufficient powers, it will be able to cope with them. This is where the legislative element of our assembly is important, because it may need powers such as the New Towns Acts and the Highlands and Islands Development Board in order to get to grips with our problems. We want an agency that has the aid of an assembly with legislative powers. We also need an agency which has sufficient financial strength behind it, in the first instance, from grants and borrowing rights in the private and the corporate sector from this House, and in due course from finances from a Welsh Parliament.
  We hope that, side by side with this agency, we shall see the establishment of an economic plan for Wales which would be controlled by the agency and which would come under the aegis of an elected assembly. We have been working in a vacuum in the past. Now we see some ray of hope for building a future.
  A lot of time in this debate has been given to nationalisation. May I briefly refer to our stance on this matter? We do not take a doctrinaire view on it. Although many Members on this side of the House have accused the Government of being doctrinaire, it is equally doctrinaire to defend the situation as it is. It is one doctrine against another. What we must find, not only in Wales, but in these islands generally, is the solution that meets the circumstances in each instance, irrespective of doctrine. That may mean more State control in some sectors, and it may not mean State control in other sectors. It is a question of getting the answer that meets the problem.
  In Wales our experience with nationalised industry has been mixed, to say the least. We have had a considerable number of nationalised industries; but nationalisation has not brought the expected Utopia. Nationalisation of the coal industry did not bring Utopia for the coal miner. In fact, employment in coal mining dropped from 140,000 in 1948 to 35,000 in 1973. The impact

  989
  of nationalisation means that the situation is the same for the worker; he has the same problems to face, and a remote management in a private sector is replaced by a remote management in a public sector.
  It is important in nationalised industries that as much power as possible is devolved from a bureaucratic centre to the plants, whether in the coal mines or in manufacturing industry, so that the person on the factory floor may have the maximum say. Without doubt, the worst decisions are those taken by persons most removed from the problems. If we expect working people to behave responsibly, we should give them as much responsibility as possible to see what they do with it.
  We have had problems, in coal, with a cutback in employment. The railway network has been massacred. Between 1964 and 1970 200 miles of track were closed and 80 stations were closed—and this was under the Labour Government. I am not saying that there were not reasons for considering the future of the railways, but nationalisation, of itself, does not necessarily solve all our problems.
  In Wales three steelworks—Ebbw Vale, East Moors, in Cardiff, and Shotton—are faced with possible closure. I need not tell the Secretary of State for Employment that Ebbw Vale, with an excellent labour record, had its first lost day in an official strike in a protest against the impending closure of two of the three profitable plants. It is difficult to convince people in Wales that nationalisation is necessarily good in view of things that are likely to happen to the steel industry.
  We have similar problems in the electricity industry. Of the eight offices that control electricity production and distribution, seven are located in England. These provide jobs which we could reasonably have expected to be in Wales for the Welsh people. This, too, is an example where possibly nationalisation could help, although in practice it has not done so.
  The telephones in North Wales are run from offices in Chester, and in Mid-Wales from offices in Shrewsbury. In other words, nationalisation has not solved any problems. When the Government say that they will use the new controls provided in an Industry Bill to supply jobs for areas like Wales, we hope that this
  990
  will be so, and that we shall not hear the same old story as before.
  We fear that there may be a remoteness, an insensitivity in the public sector, the type of insensitivity that has led to the fiasco of the Hirwaun gas tanks and to the fiasco in our water charges. Having said that, there is a rôle for the public sector in Wales, provided that it is decentralised, and provided that it is answerable to the people of Wales and, particularly, to people at plant level. There is a rôle for this reason: nationalisation—
  Mr. Arthur Lewis: Answerable to Parliament.
  Mr. Wigley: The hon. Members says "Answerable to Parliament". One of the problems that I have in this Parliament is getting at the nationalised industries. Today I had eight or nine Questions turned back, because they concerned the activities of nationalised industries in Wales. I could not have the statistics on them. Indeed, it needs to be more answerable to Parliament if we are to have effective control in these matters.
  There is a case for nationalisation where industries are dependent on public funds. Of course there is. There is a case for nationalisation, also, where industries are in a monopoly situation. But I think that just a blanket nationalisation would be a very dangerous policy, and expensive, too. If we have the £11,000 million, or whatever the figure will be, to adopt this programme, I would rather see that money spent on the hospitals, schools, housing, so desperately needed. If we need to raise that sort of money for industrial investment, let us put more of the onus on industry to raise the necessary capital.
  From the Welsh point of view, the Gracious Speech contains mixed blessings. When the measures come up in detail, we shall judge each one on its merits. There are some things that undoubtedly can be used for the benefit of Wales and some things that may not appear to be so at first sight. We look forward to seeing these.
  At the end of the day, however, the problems that face us in Wales and in the other countries of the United Kingdom generally, may be those of employment and manpower. There may be problems

  991
  of energy and horse power. Without a shadow of doubt, however, the greatest problem is one of determination and will power. In Wales, I cannot help but feel that my party has the will power to find an answer to our problems.
  8.33 p.m.
  Mr. Frank R. White: I thank you, Mr. Deputy Speaker, for giving me this opportunity to address the House for the first time. I am mindful of Mr. Speaker's comments last Friday concerning conciseness of speech, and I shall attempt to adhere to his ruling, having due respect to the length of both your memory and Mr. Speaker's.
  In accordance with the tradition of the House, I wish to place on record on behalf of the electors of Bury and Radcliffe the appreciation felt by all constituents for the service rendered to them over four years by the previous Member of Parliament for my constituency, Mr. Michael Fidler. Throughout his parliamentary service, my predecessor represented the people of the constituency in a diligent and efficient manner, building for himself a high level of personal representation. His reputation both inside and outside the House for the work he did on behalf of the constituency is both well known and greatly admired. I personally could not wish for a greater objective than to follow Michael Fidler's standards of service and, if possible, to seek to improve upon them.
  Hon. Members will know that, as well as being known as the original home of the black pudding, Bury is famous for other parliamentarians, too. Our most famous son was Robert Peel, the great reforming Prime Minister of the last century, founder of the police force, a man who was successively Chief Secretary of State for Ireland, Home Secretary and Leader of the Conservative Party that emerged after the 1832 Reform Act. Peel's policies in the 19th century did much to ease this country's social and economic transition from an agricultural and mercantile nation to an industrial society.
  It is with more than a little of Prime Minister Peel's ghost in the background that I wish to raise with the House an issue that is once again threatening Lancashire's social and economic stability.
  992
  The House will recall that the hon. Member for Rochdale (Mr. Smith) raised with the Prime Minister at the opening of this debate the serious situation facing the Lancashire textile industry as a consequence of the increased imports of cotton yarns, particularly from Greece and Turkey. Industrialists and constituents have mentioned this problem to me. Although it may be a contentious issue, I make no apology to the House for representing to the best of my ability the problems and potential dangers facing the textile industry in my constituency.
  I have received the correspondence that my predecessor initiated with the Department of Industry. I have visited the Peel Mills Group in my constituency and I wish to indicate to the House the need for urgent and immediate action.
  In replying to my predecessor on 9th May this year, the hon. Member for Oldham, West (Mr. Meacher), the Under-Secretary of State for Industry, stated:
  "In the particular case of Turkey"—
  and hon. Members will be aware that Turkey is an EEC Mediterranean associate country—
  "the increase in UK cotton yarn imports to 366 tonnes in 1973 was significant when compared with 30 tonnes imported in 1972. Even so, this cannot be really considered against the perspective of the overall total imports to amount to disruptive proportions."
  For the benefit of hon. Members let me say that the total imports for 1973 were 1,408 tonnes from all Mediterranean countries. The Minister continued:
  "Should imports become so"—
  I presume he means disruptive—
  "the terms of the EEC-Turkey agreement would not prevent us from taking action to avoid unacceptable social and economic consequences."
  I should like to inform the hon. Member for Oldham, West that cotton yarn imports this year for the period January to June amount to 1,920 tonnes from Turkey alone. That is a 500 per cent. increase, within six months, over last year's figure—more in six months than for the whole of last year from all the Mediterranean associated countries. The social and economic consequences about which he spoke are now being felt by the industry and, more particularly to me, by the textile operatives in my constituency.

  993
  Within the last two months a 100 per cent. take-away from warehouses of homespun yarn has dropped to a 30 per cent. take-away, and the consequence has been that production has been cut back, overtime has been cancelled, shift working has been discontinued, and four-day working weeks have been implemented with the threat of further reductions to a three-day week; indeed, some mills are facing total closure.
  Hon. Members will recall the old schoolday doggerel that Britain's bread hangs on Lancashire thread. Quite literally, the bread of hundreds of my constituents and thousands of Lancashire textile operatives hangs on where we buy our thread.
  During the debate hon. Members questioned the definition of a social contract. If anything, surely a social contract to the industry and to the workers in textiles means the ability and the opportunity to work a fair working week, and at the very least to produce goods for the home market with some measure of protection from the dumping of cheap cotton yarns imported at a subsidised cost from the country of origin.
  The industry is not asking for money. It is not frightened of competition on equal terms. It is willing to invest to maintain an efficient textile industry. But it needs, now more than ever, the same Government protection that other countries give to their home-based industries when they are faced with similar threats of import dumping.
  The industry has a good labour relations record but, within three weeks, men and women—it is a feature of the textile industry that very often a man and his wife work at the same mill—who were being exhorted to work shifts and extra overtime are now being laid off work.
  I warn those not inside the industry who are merely consumers of the products that cheap imported cotton yarn does not necessarily mean cheap consumer goods. When the market is up, those countries sell at our consumer prices; only when the market is down do they undercut. I fear that, should they gain a total monopoly due to the collapse of the Lancashire textile industry, they will be able to charge their own price. They will do
  994
  just that—and what price price restraint then?
  The Gracious Speech refers to the establishment of a more liberal pattern of trade and the provision of aid to underdeveloped countries. I support these ideals. The textile industry, mindful of its part in a social trading pattern, also supports these ideals. But both of us say, "Not at any cost". The cost should not be the sacrifice of our home-based industries. There is a balance to be achieved —a balance between aid, development, trade and home industry support. If anyone doubts our sincerity, I remind the House that the textile industry has sacrificed more than most in attempting to find this balance, particularly during the last 20 years.
  Our record of principles in politics goes back over 100 years, to the American Civil War, when Lancashire spinners refused to work slave-picked cotton. The disruptive proportions of imports referred to by the Under-Secretary of State for Industry are now upon us. Unacceptable social and economic consequences are here, and therefore, on behalf of my constituency, I request the action promised.
  It is recorded that when another of my predecessors for the Bury constituency, Mr. Walter Fletcher, who was a Member for 10 years from 1945 to 1955, made his maiden speech, Mr. Speaker told him to hurry and get on with it. I am grateful for your tolerance, Mr. Speaker, and that of hon. Members for listening so attentively. I trust that I have made the House fully aware of the impending disaster to the textile industry. If I have to demonstrate my concern further, I am prepared to don sackcloth and ashes, carrying the penitential candle, and walk to the Department of Trade in order to bring home to it the urgency of our situation.
  The motto of my town, loosely translated, means that hard work will solve any problem. But to do that we need industry.
  8.43 p.m.
  Mr. Malcolm Rifkind: As a veteran of all of 10 months, I find it a particular privilege to congratulate the hon. Member for Bury and Radcliffe (Mr. White) on his maiden

  995
  speech. He spoke very knowledgeably and interestingly about the problems of Lancashire, and he had the ear of the House when he did so. He may not be able to emulate one of his predecessors. Sir Robert Peel, in ever hoping to become Leader of the Conservative Party, but I am sure that he will emulate both the energy and the conscientiousness of his latest predecessor, Mr. Michael Fidler. The House wishes him well in future appearances here, but not in sackcloth and ashes.
  The hon. Member for Caernarvon (Mr. Wigley) spoke about the problems of devolution. The hon. Member for Clackmannan and East Stirlingshire (Mr. Reid) spoke of the new dimension of Scotland in politics today. He added that for the first time in the history of this country some 30 per cent. of the Scottish electorate had voted for a party that believed in the dismemberment of the United Kingdom.
  It behoves those who belong to parties that operate on a British basis to take that lesson very carefully. Whether or not we believe that people who voted for the National parties specifically wish to see the dismemberment of the United Kingdom, it is clear that both National parties have been completely sincere in saying that that is their objective.
  Therefore the time has now come not simply for those in Scotland or Wales, but south of the border, in England, to start promoting and arguing the benefits of the union. We have to realise that for the first time since 1745 there is a serious possibility that the United Kingdom will not continue in its present form, indeed, that the United Kingdom will not continue—full stop. It has become necessary for hon. Members and others who believe that such a solution would be a disaster for all the people of Great Britain to put forward a positive argument in favour of the union.
  This may sound like an introduction to my giving reasons for the union. However, I am now going to move on to a completely separate topic. But I believe that the point should be made, and it will have to be made increasingly in the weeks and months to come.
  Over the past week we have heard debates on a whole range of topics of concern to the country. I should like to
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  speak on a subject that has hardly been given a mention. It is one of the gravest problems facing the world today. We had in Rome today the opening of the World Food Conference. Perhaps the primary question to be considered by that conference is not so much the starving cattle to which the hon. Member for Caernarvon referred, but the more disastrous fact that throughout the world many millions of people not only risk the possibility of starvation, but have died and are dying from starvation at this very moment.
  Much has been said in recent years about the problems of over-population and of food production. But we know also that, despite innumerable conferences, despite repeated resolutions and the good faith of Western Governments shown by providing the means for some improvement in the position of affected countries, the problem of starvation, far from getting better, has continued to get far worse.
  The Times is not famous for extremist headlines, but the headline yesterday was:
  "Belsen Scene in Bangladesh Famine Area"
  It went on to mention how 10,000 people had died in that small part of Bangladesh, how 60,000 had died in the whole of Bangladesh this year, and how it is almost inevitable that a further 40,000 will die by the end of the year. It said:
  "The market place in Kurigram and its squalid by-lanes are crowded with almost naked emaciated destitutes, some of whom compete with pariah dogs in picking over the garbage choking the monsoon gutters in search of food. Others, dazed and aimless, simply sit on the ground waiting for death.
  In the centre of Kurigram, a large corrugated iron pen has been set up. It serves as one of some 5,700 emergency food centres and gruel kitchens established by the Government throughout Rangpur district and the rest of Bangladesh.
  Feeding time, at 3 p.m. every day, is a scene from Belsen as the starving stream in from all directions to receive a roti (thin flat piece of bread), or perhaps two if they are lucky, to keep them alive for the next 24 hours. Women and small children predominate."
  This is not some horror story which we see in the cinema and then can forget. It is happening today, as we debate these matters.
  These are problems which, far from getting better are getting worse. Nor are they in isolation. The tragedy we are facing is that after two decades of comparative improvement in the production

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  of food supplies, we have in recent years seen famines and starvation, not as isolated events in the history of these countries, but as something endemic to the very nature of them. In Bangladesh the density of population is such that if it were repeated in a country the size of France we would expect a population of 600 million. How surprising can it be that these places have such problems? It is not peculiar to Bangladesh. We saw in recent months how West Africa and the Sahel countries, Ethiopia and parts of Latin America, had exactly the same problems which we now see in Bangladesh.
  It behoves us to consider the reason for the problem and to ask what can we as a Government and a House do about it. This was referred to in the Gracious Speech. It received a mention of three lines. It said:
  "My Government recognise the economic problems confronting developing countries, and will seek to increase the provision of aid. They will promote…a more liberal pattern of trade."
  I congratulate the Government on at least recognising the problem. Do they recognise the extent of it? Do they realise the gross and depraved depths to which ordinary daily life in such large parts of the world has descended? We know that the problem has got worse because at a time of mounting over-population we have had, coincidentally, a decrease in food supplies. At the same time, there has been a dramatic trebling or quadrupling of the cost of fuel, fertilisers and the other necessary factors which go towards increasing food production in those countries.
  The attitude, not only of this country but other Western countries must be twofold. First, we must ensure that our production of food in the United Kingdom, Western Europe and North America, is maximised and not minimised. We must give all possible aid, not merely to assist our farmers to make a good living, important though that is, but also to ensure that there are supplies available when the sort of emergency we see in Bangladesh occurs in future.
  What we need is some form of world reserve of food. We can take a leaf from the Old Testament. We saw how, in Egypt, they were given good advice during the seven fat years to prepare for the seven lean years. Because they took that
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  advice, famine was averted. This is exactly the type of solution we should be considering in the United Kingdom and Western Europe. The argument for a great expansion of the food programme should be based on this. It goes beyond that. Clearly the provision of food supplies by the Western countries will not, in itself, solve the problem.
  If we are to make a lasting contribution —if we are to cure the problem—we must help those countries to help themselves. It is an old saying, but true, that if one gives a man a fish one will feed him for a day, but if one teaches him to fish he will be able to feed himself and his family for the rest of his life. Therefore, it is necessary for Britain and Western Europe to provide the agricultural training and the fertilisers—the means by which these countries can modernise and rationalise their own agricultural programme.
  The problem, although it is one which the Western European countries in particular have to face, is not their exclusive concern. The Arab countries are largely responsible for quadrupling the price of oil. This has made an enormous difference to the ability of the poorer countries. to solve their problems.
  There is another set of countries with a major responsibility—the Communist countries—which are on the same side of the line. The Eastern European countries. in particular the Soviet Union, are on the same side of the line when we divide rich from poor. The Soviet Union has been very remiss in not recognising its responsibilities and providing much-needed aid.
  If we, in our efforts towards building a new Jerusalem in this country, forget the other 90 per cent. of the world—if we forget those countries where starvation is not an exception but a way of life—the new Jerusalem we create will be a great material achievement, but in creating it we shall have lost the privilege of benefiting from what we have seen. Only if we remove the scourge from the countries which have to bear that scourge every day can we claim that the new Jerusalem is a justifiable goal for this country.
  8.52 p.m.
  Mr. Roderick MacFarquhar: I add my compliments to my hon. Friend the Member for Bury and Radcliffe (Mr. White) for his forthright speech. I am

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  sure that all hon. Members will agree that it augurs well for the forthright way in which he will stand up even to Ministers of his own party on behalf of his constituents. We look forward to his interventions in future debates.
  I wish to pinpoint an unwarranted assumption that underlies the amendments put forward by the Opposition both yesterday and today—an assumption that suggests that the Government, by nationalising or buying into private enterprise, would be damaging a British industry that is dynamic and aggressive, that is continually investing and modernising, and that is highly competitive in world markets—the goose that lays golden eggs and will continue to lay them for as long as my right hon. Friend the Secretary of State for Industry keeps his hands off them. The facts are otherwise, and so is the condition of the eggs.
  Private manufacturing industry accounts for one-third of our gross domestic product, four and a half times the contribution of the nationalised sector. Privately-owned industry thus plays a dominant rôle in our economy, and it must therefore accept the blame for the failure of our economy to match up with the post-war world and for Britain's inability to equal the growth rates prevalent throughout most of the other Western European industrialised countries.
  Within British industry where must the blame be assigned? It must be assigned to management, of course. As that dismal PEP report on "Attitudes in British Management" said:
  "The performance of managers is crucial to economic growth."
  An article in the Financial Times on Germany's post-war economic miracle, after making an allowance for a whole range of factors commonly adduced to explain it, concluded that they would have all been "useless without competent management", and said that that is where the bulk of the credit must go. Equally, Britain's lamentable failure to match German post-war performance must in the last analysis be attributed to the failure of British management.
  What is wrong with British management? I shall quote not from a Labour Party publication but from the business-
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  man's bible, the Financial Times, which presumably would not print the kind of articles on British management that it does print if its businessmen readers were likely to denounce it for inaccuracy. A Financial Times article last November quoted from a British executive who had run a German plant for four years and had since been in charge of a similar British operation. According to this firsthand evidence:
  "British managers are more gentlemanly, they do not make a fuss… The German manager just will not stand for incompetence… he insists on the best, and goes on fighting until he gets it.… The German manager is better trained, especially in the technical sense.… Fewer problems are left to chance, and there is less reliance on vague hopes that 'it will come out in the wash' or 'it will be all right on the day'".
  In the 1960s one of Britain's most prestigious firms—ICI—went to the United States to discover why the productivity of their American counterparts was so much higher. In some cases the use of people there was 50 per cent. more efficient than in ICI. The ICI investigation revealed that the difference in efficiency had nothing to do with bad industrial relations in Britain, or the fact that the Americans worked harder. Most of the important differences lay in the managerial field. Management in America was far more streamlined, and the commitment to planning was more developed.
  As one reads the literature on comparative management practices in the West, one continually comes across the same criticisms of British management—namely, lack of aggression, unwillingness to take risks, reluctance to invest in research and development, suspicion of engineers and scientists, and, above all, a reluctance to initiate or accept change.
  It is these shortcomings of British managers which are a major factor behind our failure to grow. There are, of course, exceptions. We have excellent managers. I am glad to say that there are some in my constituency. Perhaps it is no accident that they run relatively small firms and have close contacts with their workers. But I am talking of the general situation of British management, particularly in the larger firms, which is lamentable.
  Despite their failings compared with the performance of American managers,

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  British senior executives in industry take almost exactly the same amount out of the economy as do their opposite numbers in the United States. According to a recent study in America, the richest 5 per cent. of the population get 20 per cent. of national income before tax. In Britain the same percentage applies to the richest 6 per cent. of the population. It is fair to assume that senior management supplies a large proportion of the richer segments of the population. Therefore, we have a picture of laggardly British managers failing to provide a spur to economic growth, but still remunerating itself on the American pattern. Is it any wonder that there is now a widespread demand for Government to play a larger rôle in industry, either through nationalisation or through investing in key firms?
  The Government must do what private institutional investors have failed to do, and that is to make British management accountable to somebody other than itself —a change which has been held out as desirable by the Financial Times. Whatever else is true, it is the case that the Government could not do worse than the largely shoddy performance of private industry since the war. One does not hear demands for nationalisation in America, Germany or Japan, where private industry to a great extent so far has fulfilled its aims and has provided rewards for the working class. This is not the case in Britain. I wish it were the case, because we would not be in the mess in which we now find ourselves. The true doctrinaires are the Tories, who continue to mouth slogans about bankrupt private enterprise. What is now clear is that in this country at least industry is too important to be left to the industrialist.
  9.0 p.m.
  Mr. John Peyton: Happily, I do not feel called upon to take up the singularly ungenerous exposé of the hon. Member for Belper (Mr. MacFarquhar).
  I am surprised by the reflection that I do not think I have ever before taken part in a debate on the Queen's Speech. Therefore, my surprise is even greater that I should be doing so for the first time from the vantage point of the Opposition Front Bench.
  I wish first to congratulate the three maiden speakers—unhappily, all on the
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  Government benches. We heard three excellent maiden speeches, and I wish to associate myself with their generous remarks about their predecessors. For personal reasons, I wish to pick out one former Member. I refer to Martin McLaren, an old friend, who was in the House in earlier years, who then left and returned. I hope that I may express the hope that he will return to the House again.
  The Secretary of State for Employment, who revealed himself as a regular and evidently comprehensive reader of the Sun—I am not trying to have my revenge for the compliment that he paid me—today made one of the best speeches that I have ever heard him make. I say this particularly because it had a content of warmth and an admission of the enormous difficulties facing anyone in his position. It certainly improved his speech enormously.
  The right hon. Gentleman referred to the differences between the parties and the ferocity of argument, from which I would in no way dissent, and then to Parliament's role, as he saw it, in saving this country in a desperately difficult situation. I think, sadly, that we must face the fact that Parliament is not basking in a high noon of public regard and esteem. We may, and indeed often will, disagree; but most of us accept that, for all its blemishes, Parliament is far less odious than any alternative that is likely to be presented to this country. If so, I believe that right hon. and hon. Members on both sides of the House must reflect that none of us, except perhaps the Scottish National Party, did terribly well in the election.
  The Parliamentary Secretary to the Treasury (Mr. Robert Mellish): I did pretty well.
  Mr. Peyton: The Patronage Secretary is, as ever, an exception.
  There are two questions which we must face. First, how do we recover some measure of the public respect for Parliament which has been lost? Secondly, how do we recover from the Government some of the power which has been filched from us? Also, I think that we would do very well if from time to time, instead of talking, we listened to what is said outside.
  The Secretary of State for Employment issued a warning in clear terms

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  which I was pleased to hear. He said that if the guidelines of the Government's policy are persistently broken it will be much more difficult to prevent massive unemployment. That warning has been issued repeatedly over past months by my right hon. and hon. Friends.
  The right hon. Gentleman made it clear—we knew it already—that he had abandoned statutory controls and admitted, quite plainly, that there remains alone the policy of consent. It was clear that this looked fairly flimsy. It cannot be described by any name as formal as a contract.
  The right hon. Gentleman's speech, when put by the side of the Prime Minister's habitual attitude on this subject, which is, "We have got a social contract and you have not", compares very favourably indeed. The truth is that no one has a social contract. We all need one, but some people are determined that there will never be one.
  The hon. Member for Cornwall, North (Mr. Pardoe) made an interesting, profound and important speech. I was very sorry that at the end he told us that, for narrow personal reasons, he and his party would not be voting for the Opposition amendment. I would remind the House that the amendment reads as follows:
  "But humbly regret that the Gracious Speech in no way measures up to the perils facing the country and that its doctrinaire proposals will divide rather than unite the nation."
  The leader of the Liberal Party ended his speech the other day with these words:
  "My criticism of the Queen's Speech is that it is much more a lecture on the doctrines of Socialism than it is a programme to meet the needs of the nation."—[OFFICIAL REPORT, 30th October 1974; Vol. 880, c. 267.]
  I wondered whether there had been some obscure telepathic communication—
  Hon. Members: Where are the Liberals?
  Mr. Pardoe: I am here. What more do you need?
  Mr. Michael Foot: I do not want to enable the Liberal Party to escape from its predicament, but does the right hon. Gentleman envisage telling us during his speech the Opposition's attitude towards a statutory incomes policy?
  Mr. Peyton: I am busy at the moment with the Liberal Party. It will not take
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  me long. I was speculating whether, by some mysterious process, they had influenced our drafting or we had influenced the summing up of their leader. By no means is it clear.
  I would commend my hon. and learned Friend the Member for Southport (Mr. Percival), who voiced an important sentiment in condemning those who willingly and wantonly sow distrust and hatred in our community. I did not agree with all that the right hon. Member for Battersea, North (Mr. Jay) said, he will be surprised to learn. He rather hoisted the flag of "Business as usual". But he made some wise and sensible remarks about oil economics and saving on oil. The hon. Member for Mitcham and Morden (Mr. Douglas-Mann)—I am sorry that he is not here—made an interesting and thoughtful speech which made almost no allowance at all for human nature.
  I should like, if I may be allowed, quite exceptionally, to refer to the Gracious Speech. The adjective is forced upon me by custom and by duty, but try as I may to find from the deep resources of my charity some other complimentary epithet, I must say I am defeated. It reads:
  "My Government will give their full support to international efforts to solve the world-wide problem of inflation.… My Government recognise the economic problems confronting developing countries ".
  Well, thanks very much. They are not suffering from shortsightedness, anyway.
  The Socialist Party manifesto—I must say this, and I never expected to say anything civil about it—was greatly to be preferred to the Gracious Speech. It at least referred to the fact that this country was facing the most serious crisis since the war. I have no doubt that it will shortly be enshrined in Holy Writ in the minds of Labour Members. We on this side will concede that it has at least one claim, and that is to the antiquity of its thought.
  Perhaps I could remind Labour Members that not everyone fell over themselves with enthusiasm about this document. In a leading article which I should very much like to have written, The Times used the words "margarine style". It then went on to say:
  "It seems to have been addressed by those who are not quite honest to those whom they believe to be not quite intelligent."
  That is an immortal summing up.

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  Kindness, in my view, requires that one should draw a friendly veil over the speech made by the Prime Minister. But no veil is quite large enough. The whole of that great, warm mass exuded a kind of gentle steam of self-congratulation. Moreover, it failed entirely to conceal one or two other things. First, it failed to conceal that the House of Commons was to be confronted with an exceedingly bulky legislative programme.
  One of the things which has puzzled me for many years is how in the name of conscience it is possible for any Government to secure the willing cheers of their back benchers when they make the announcement that they are going to add enormously to the volume of incomprehensible, turgid legislation which we churn through the House year after year. Yet such is the euphoria and folly that prevails in the early days of any Session that back benchers can still be persuaded to cheer that which they will ultimately learn bitterly to regret.
  The right hon. Gentleman the Prime Minister—
  Mr. Patrick Cormack: Where is he?
  Mr. Peyton: Never mind about that. I am reminded of one of those splendid little things which only he can say. During the General Election he said:
  "and it was generally agreed that I fought the election in a spirit of great fairness and tolerance."
  Then—[Interruption.] Honourable Members opposite must not prevent me from reminding them of the pearls which their leader produced. On 29th October he said:
  "The gravity of the crisis, so far from reducing the need, underlines the need for measures for the radical restructuring of some of our industries."—[OFFICIAL REPORT, 29th October 1974; Vol. 880, c. 73.]
  What does that mean? By whom is this restructuring to be carried out?
  Mr. Russell Kerr: You guess.
  Mr. Peyton: It is a nightmare answer. Perhaps it will be the Secretary of State for Industry. Easily the most terrifying thing about his speech was that he obviously believed every word of it.
  I return to this issue: by whom is this radical restructuring to be carried out? By the great powerhouse of White-
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  hall? By that splendid decision-making process with which we are all so painfully familiar? Costive or dynamic? Take your choice. I have no doubt what my view is, but I do not believe that anyone in his right mind, no matter what his views on British industry—and some are very unfriendly and much more unfriendly than is deserved—can possibly claim that the management of industry will be improved by a further edition of bureacratic control. Then the Prime Minister reminded us of a recent ministerial broadcast:
  "Everything we do, particularly where the confidence of industry and trade and of all those who work in industry are concerned will be subject, case by case"—
  now, watch the words—
  "to complete and effective parliamentary control."—[OFFICIAL REPORT, 29th October 1974; Vol. 880, c. 77.]
  as, for instance, with the existing nationalised industries.
  I cannot recall the number of times on which I have had the doubtful privilege of standing at the Dispatch Box saying, "No, Sir" to question after question asking me to issue a general directive to a nationalised industry to do something which my questioner thought was wise but which I could not possibly influence them to do.
  My hon. Friend the Member for Mid-Sussex (Mr. Renton) made a very sensible speech here on the subject of Government meddling and the extra weight added to our limited management resources by the constant load of interference and the insatiable appetite for information from which Whitehall habitually suffers. What it does with the information must remain a mystery unsolved for all time. But the idea that parliamentary control is something of a reality is a myth which has been encouraged year after year, particularly by right hon. Gentlemen opposite, and why their own supporters do not challenge them more effectively I do not understand.
  I am sorry that the right hon. Gentleman the Secretary of State for Industry is not here because, although we had a great deal of him yesterday, I should like to have asked him, on behalf of my own constituents, who he thinks will benefit from the takeover of Westland Aircraft. When are we to be told—my hon. Friends were curious about this yesterday—how

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  much these expensive plans will cost? Will the money be raised by tax or by borrowing? I should not have thought that an undue intrusion into the privacy of the Labour Party.
  There is one speech to which I should like to draw the attention of the House, the speech of the Foreign Secretary, who said:
  "Today the world is trying to steer its way through seas that are literally uncharted."
  A little further on he said:
  "… there is recognition among many of the world's leaders that the problems that we face are beyond our experience and beyond our knowledge and that we need new ideas and concepts if they are to be solved."—[OFFICIAL REPORT, 30th October 1974; Vol. 880, c. 229.]
  Mr. Thomas Swain: Amen.
  Mr. Peyton: I am sure that the Foreign Secretary will be deeply grateful for the hon. Gentleman's devoted support to his cause and for this rather belated display of good judgment on his part.
  I hope that it will not be thought vulgar if I return to the Queen's Speech. Talking about defence, it says that the Government
  "will ensure the maintenance of a modern and effective defence system while reducing its cost as a proportion of our national resources."
  That seems to be mystery coupled with cliché, resulting in that marvellously expressed determination to have their cake and eat it.
  The next entry to which I should like to refer is:
  "Within available resources, My Government will continue to maintain and improve the National Health Service and, following consultations, will introduce proposals on democracy in the Service".
  Vintage Castle!
  What does that kind of stuff mean? We have had no explanation of democracy in the health service—perhaps in the operating theatre—[Interruption.] The hon. Member for Feltham and Heston (Mr. Kerr) is most generous—he keeps on offering me a drink. I hope that he will accept his own invitation. I am sure he could do with one!
  We are then told in another of these dynamic paragraphs:
  "My Ministers recognise the value to the nation of expanding domestic food production
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  economically and efficiently, and will continue their discussions with the farming industry to this end."
  "Discussions "—is that the best the Government can offer to an industry that is in trouble now? Moreover, how long are they prepared to continue their supine, unhelpful, negative attitude when they are risking the future supplies of food in this country, and at a time when even the most thoughtless and imprudent Government must be unwilling to load further the balance of payments?
  I hope that the Prime Minister—and I must say that for once I rather miss him —will read some of the things that were said in the debate on agriculture, particularly the figures that were quoted by my hon. Friends the Members for Ross and Cromarty (Mr. Gray) and Ludlow (Mr. More). If the right hon. Gentleman wants any further information on the subject, all my hon. Friends who have the privilege of representing West Country constituencies will be happy to join me in offering that evidence.
  I do not believe that anyone would want to be so cruel as to tell the people of this country that they have now the Government they deserve, but I think that someone has to say that over the years we have been letting ourselves down abjectly, attracting the pity of our friends and the derision of our foes. I believe it is time that we stopped destroying ourselves in this envious and acrimonious strife.
  The Secretary of State for Employment spoke of Milton's vision of our country in a very moving way. He will no doubt recall the words:
  "Long is the way
  And hard, that out of hell leads up to light."
  We shall never succeed if we go on in this way of envious disunity. Let the Government—[Interruption.] I am not sure whether the right hon. Gentleman is laughing at that thought but for me this is so good. It is bathos, as the hon. Gentleman said. We cannot go on—[Interruption.] The eloquence of the hon. Member for Feltham and Heston from a seated position does nothing to destroy the truth of what I am saying. It merely reveals, once again, the dependence of the Labour Party on sedentary barracking, and nothing else.

  1009
  Let the Government, at long last, show some understanding—
  Mr. George Cunningham: The right hon. Gentleman knows little about politics, but he is a good comedian.
  Mr. Peyton: I am much obliged. The hon. Gentleman knows much more about comedy than I do.
  Let the Government at long last show a measure of understanding of the views of those who are, incidentally, the majority—the views of those who do not agree with them.
  9.27 p.m.
  The Lord President of the Council and Leader of the House of Commons (Mr. Edward Short): In winding up this debate, I do not intend to make the traditional type of speech made by the Leader of the House. I had enough of that last February. I want to speak, first, briefly about devolution, because so many hon. Members have spoken about it and because it is one of my current responsibilities. Second, I want to comment on the economic crisis facing the country which has not, in my view, had nearly sufficient attention either in the debate or in the election.
  Many Members have raised domestic points affecting the House. I shall have the whole of HANSARD gone through and shall contact all those hon. Members individually.
  I should like, on behalf of the whole House, to congratulate the 22 Members who have made their maiden speeches. It would be invidious to select any of them, because the standard has been remarkably high. I have listened to many maiden speeches, and that is no formal empty compliment. We look forward to hearing those hon. Members frequently.
  As the right hon. Member for Yeovil (Mr. Peyton) said, there are many criticisms of Parliament today, but I believe that the standard of new Members entering the House in recent years has been very high indeed. The future of the House of Commons is assured as long as it attracts Members of their calibre. May I say to the new Members that if I can help any of them in any way, I hope that they will feel free to come and see me at any time to discuss their problems?
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  After the recent election, the Prime Minister formalised the responsibility I have had for co-ordinating work on devolution since March of this year. A special unit has been created in the Cabinet Office under a second permanent secretary. The job of this unit will be to prepare a brief for the parliamentary draftsmen who draft the legislation.
  A ministerial team has been established there with a Minister of State, my hon. Friend the Member for The Wrekin (Mr. Fowler), and a Parliamentary Secretary from both the Scottish and the Welsh Offices, my hon. Friends the Members for Stirling, Falkirk and Grangemouth (Mr. Ewing) and for Merthyr Tydfil (Mr. Rowlands). The strengthening of the official ministerial teams involved virtually the only ministerial changes in the new Government. That demonstrates the high priority given by the Government to devolution.
  I know that my Scottish and Welsh colleagues are particularly interested in the timetable for devolution. With the best will in the world, it is still impossible to state this with certainty. There are whole areas of decisions to be taken that involve the most complex legal and constitutional matters of a depth and nature quite unprecedented in our history.
  The mechanics of the assemblies are relatively straightforward. But such matters as the financial arrangements, the delineation of the powers to be devolved, and the relationships with this Parliament are extremely complex. They call for an enormous amount of detailed work, often involving extensive research into ancient moss-covered statutes which will require amendment.
  I sincerely hope that the legislation will be drafted during the present Session, and that by Christmas this year I shall be able to give a firmer timetable. I assure the House that there will be no avoidable delay. The mammoth task of unscrambling our constitution in respect of Scotland and Wales, for that is what is involved, will be pushed ahead as fast as is humanly possible.
  I am quite determined, and I am sure the whole House will support me, that in the interests of future political stability we must get the legislation right. We cannot risk doing a botched-up job.
  Mr. David Steel: I do not ask the Leader of the House to give a direct answer tonight, but will he undertake on behalf of his ministerial team to consider the request that I believe has been made by hon. Members on both sides of the House that the Government ought to reflect on the structure of local government, which has been laid down without consideration of a Scottish assembly, and see whether that should not be revised, or at least postponed, in view of the Government's current thinking.
  Mr. Short: Certainly. I listened to the speech today by the hon. Member for Clackmannan and East Stirlingshire (Mr. Reid), who referred to that point. I consider it a reasonable request, made by a number of hon. Members, that the Government should from time to time make their decisions known to the House and to the country—[Interruption.] I am quite willing to discuss how this should be done in the interim between the present time and the publication of the legislation. It could be done by one or more parliamentary statements or even by a number of brief White Papers. In any case, the House will wish to debate devolution early in the new year, and this will give the Government an opportunity to make an interim statement on the progress being made.
  The people in Scotland and Wales who believe that we are going ahead too slowly with devolution should be put in a position where they can realise more fully the immense practical and constitutional difficulties the Government face in the operation before the process of legislation starts. However, I am quite willing to discuss how this should be done with hon. Members who are interested.
  I turn now to the second topic I wish to discuss—the economic crisis facing Britain and the social dangers which flow from it. Basically, our problem is to pay for the food, the oil and raw materials that we must import and for the manufactured goods that we have to import in order to sell our own products abroad. Time and again this chronic balance of payments difficulty has held back the expansion of our economy and threatened employment. But never more so than it does today, with the oil crisis coming on top of an already serious adverse bal-
  1012
  ance, and with a very high rate of inflation. There can be little doubt about the extreme seriousness of the situation in which we find ourselves. We are, of course, far from being alone in this, and tonight I certainly do not intend to spend any time trying to apportion the blame for this situation.
  The causes are partly internal, which we can influence, and partly external, which we can influence only in agreement with other countries. It is about these —the home-grown causes—that I wish to comment. I believe that perhaps the greatest and most widely held fallacy in public attitudes towards our national problem is that it can be solved entirely by Government order by legislation. There is a view widely held by the public that somewhere there is a correct permutation of economic policies, that if only we could get the permutation right —the eight draws—all our problems would be solved. It is a view that is prevalent today, that the Government can do anything—produce better cricket, or better mannered children, or better beer.
  Of course getting the right economic and financial policies is important—indeed, essential—and I shall say a few words later about them. But they alone can never solve our economic problems. We shall never climb out of the trough into which we have fallen with sickening regularity since the Second World War without a profound change in attitudes, expectations and behaviour by large numbers of people of very diverse opinions.
  Unless there is this broad consensus among the people of Britain, both in their attitudes and about what their individual contribution should be, I do not think that we can succeed. Without this change in attitudes, behaviour and expectations, as a nation we shall sink lower and lower in the international league tables of growth, income, living standards and, perhaps above all, in the unquantifiable but very real table of national influence in the world.
  This, I hope, is a prospect that shocks everybody. We all—on both sides of the House and among all shades of opinion of those we represent—want Britain to be great, not in the old Imperial sense of physical power but in terms of civilised behaviour in the world, in science

  1013
  and technology, in making our science and technology available to the Third World, where the danger of collapse is imminent and genuine in many cases, and in applying our long experience of diplomacy to the intractable problems threatening the stability of the world.
  That kind of contribution, which I believe is the post-Imperial destiny of Britain, is put at risk if we do not solve our national economic problems. Because we believe that finding the solution to our problems is the task of every man and woman in Britain and not solely that of the Government, we in the wider Labour movement in the past two years have asked how attitudes, expectations and behaviour can be changed.
  That is a formidable task, but it is not hopeless by any means. We have sufficient faith in the people of Britain to believe that they will respond if they believe their response is worth while. The Government's task is to make a response by the individual worth while. Leadership by the Government in the sense of merely indicating what has to be done, important as it is, is not enough. Admonition by the Government is not enough. There must be radical and decisive action by the Government to rid our society of some of the grosser inequities, deprivations and injustices which make all the calls for sacrifice and hard work, for income restraint and more production sound very hollow.
  If that action is taken, or is seen to be taken, the individual will reciprocate. In Britain we have lived with inequality, with a gross maldistribution of wealth and rewards, particularly between capital and labour, for so long that it has almost come to be regarded as the natural order. There are those who believe it is, and who constantly preach that a mixed economy can survive only with this kind of maldistribution of wealth. In our view—this is the basis of our policy—this maldistribution, this inequality in Britain, is by far the biggest impediment to a feeling of identity among the people who work by hand or brain to produce our wealth—and they are its only source. This is an impediment to a feeling of identity with our national economic problems.
  So long as his efforts merely result in more inequality, how can a factory worker in Birmingham, a shipyard worker
  1014
  on Tyneside or a miner in South Wales identify with the balance of payments problem? Without that feeling of identity, without the feeling that it is his problem, it can never be solved. I do not think that the balance of payments problem can be solved by economic policies, by arithmetic. It is one of the major errors of our generation to believe that it can.
  How can we get more understanding? How can we get more effort all round for more restraint in pay claims, when there are great reservoirs of poverty among the old or lower-paid at one end and great reservoirs of inherited wealth at the other end of the scale, or when vast numbers of our children are still subjected to the gross injustice of selection at 11—one of the great remaining social injustices in Britain? How can we call for this kind of response from the people of Britain when 53 per cent. of the wealth is owned by 5 per cent. of the people, and when, as under the previous Tory Government, no attempt was made to steady food prices or rents which figure so largely in the budgets of ordinary people?
  How can we call for this response when nothing was done about land profiteering or when company law gives to those who invest their capital the absolute right to make all the decisions and gives no rights whatever to those who invest their capital, their labour, and their lives in a company? How can we ask for a response when injustices of this kind exist?
  The right hon. Member for Leeds, North-East (Sir K. Joseph)—he is not present just now—recently made a speech which came in for a great deal of criticism. I agreed with very little of his speech, but I did agree with him very much on one point, and that was that we cannot have a healthy economy in an unhealthy society. The health of our economy and our society are interdependent, and their interdependence is inescapable, although it often escapes the economists.
  By an unhealthy society I do not mean one of which Mrs. Whitehouse disapproves. To those of us on the Labour benches the greatest moral inequities are the economic and social factors that imprison people of all ages in a life which exists on a bare minimum, deprived of opportunity, deprived of real choice in all the areas which affects the quality of

  1015
  life. The Conservative Party talks a great deal about choice. The right hon. Member for Finchley (Mrs. Thatcher) talks about it a good deal. All too often choice depends on the length of one's pocket.
  It is these defects which the Labour Government are determined to remedy, which they have undertaken to remedy as their side of the contract between the Government and the people of Britain. I say to the right hon. Lady that it is a contract in spite of her narrow, niggling, legalistic approach to it. Does she not realise that it was this kind of legalism which brought the country virtually to its knees in March of this year? The contract has been spelled out in the most specific terms. Let me say once more for the record where it is to be found. It is in two documents, the first called "Economic Policy and the Cost of Living", price 3p from the Labour Party. The second one is called "Collective Bargaining and the Social Contract", price 10p from the TUC. The second one has more pages.
  As my right hon. Friend the Secretary of State for Employment said today, if that contract is honoured by the Government on one side and by the people on the other, it could indeed give Britain an era of industrial stability such as we have rarely known in the past.
  Mr. Cranley Onslow: I put it to the right hon. Gentleman that all these interesting observations might gain a bit more weight if he would relate them to specifics. As he seems to set so much store on giving the workers more say in the industries in which they work, will he tell us exactly how he sees it applying to the mining industry?
  Mr. Short: My right hon. Friend the Secretary of State for Employment has already published his proposals on this subject. In his speech today he spoke with great candour and honesty about some of the recent wage settlements, and the right hon. Member for Yeovil paid tribute to him.
  The Government intend to honour their promises in their social and economic strategy, and we have shown that in the Gracious Speech. The TUC, on behalf of its affiliated unions, clearly intends to honour its promises. The TUC has laid
  1016
  down guidelines for negotiators in the most specific terms.
  Whether or not we solve our national problem will depend not entirely—here I agree with the right hon. Member for Down, South (Mr. Powell)—but to a considerable extent upon the degree to which union negotiators follow the guidelines. We have restored free collective bargaining, we have repealed the Industrial Relations Act, we have published our proposals for the protection of workers. It is now up to union negotiators at both national and local level—if I may use the words of the TUC document—to:
  "take account of the general economic and industrial situation and of the economic and social policies being pursued by the Government."
  We have sufficient knowledge of and sufficient faith in our trade union colleagues to believe that they will do so, and that they will show moderation, toleration and patience.
  I believe that the vast majority of trade union leaders and members are determined to make their side of the social contract work. They know that it is the only sensible way to achieve our common objectives, and the Conservative Party knows that, too.
  The right hon. Gentleman the Leader of the Opposition, when he was Prime Minister, tried to negotiate a social contract, but he would not then give way on any of his divisive policies, and he failed to do so. In the election campaign he told us that he would seek a national contract. He did not tell us how that would differ from our social contract, nor was there any better prospect to offer if his national contract failed than a return to industrial confrontation. Anyhow, the right hon. Gentleman could never have paid the price for a social contract, the price about which I want to talk in a moment.
  There is no reasonable or workable alternative to the social contract. Twice this year it has been the major issue in the election campaigns, and twice this year the nation voted for it. We got a million more votes than the Conservative Party. The social contract is the way in which the nation has decided to tackle our formidable economic, social and industrial problems, and now the whole nation must work together to make it a

  1017
  success. Will right hon. and hon. Gentlemen stop trying to wreck it? The social contract is the acid test of their credibility when they talk about national unity. It is the most significant piece of national unity to emerge for many years. Why does not the Conservative Party support it?
  The social contract applies to employers as well as to trade unions. The employers are given their freedom to manage their affairs without the inflexibility of central control of wage negotiations, and the results of our review of the price code will be announced in the near future. Employers, too, have shown a sense of responsibility. The interests of their shareholders must remain an important consideration for them, but the interests of Britain must be an infinitely more important consideration. But it applies to more than the unions and employers. They alone cannot get the country out of its difficulties any more than the Government alone can do so.
  This brings me to my original point. Our problem—our terrifying serious problem—is the problem of every man and woman in Britain, of every worker in every factory, of everybody in management, of the people in the professions—and perhaps they could give a bit more of a lead than they sometimes do—of every housewife, and of everybody with a contribution to make to our national life. It will take a united effort from us all, including the opposition parties in this House.
  We in this House have a special responsibility, an educational task, to explain the problem, not to exaggerate it or minimise it but to spell out the facts in objective terms, as the Prime Minister has done on many occasions in the past year. Perhaps in appealing for restraint from others we should also restrain our language in talking about Britain's problems.
  To my Labour colleagues I would say that if Socialism is the language of priorities in good times, it must be even more the language of priorities in the difficult times through which we are now passing. It will not be possible—my hon. Friends will have to face this fact—to do all the things we want to do; to give equal priority to all our social objectives, to the sick, the unemployed, the young, the elderly, the homeless and the helpless.
  1018
  This is a situation which our nation has faced on many earlier occasions. When the unhealthy society of which I have been talking results in the kind of economic difficulties that face us, the Labour Party finds itself elected to power at precisely the moment when the fewest resources are available for the relief of poverty and injustice. The Gracious Speech illustrates our social priorities—our priorities to help the elderly, the sick, the unemployed, the homeless and the helpless. These measures dominate our collective thinking.
  I want to give one assurance to the House and the country. In the days ahead, when sacrifices will certainly be asked for from the many who are able to afford them—my right hon. Friend the Chancellor of the Exchequre next week will have something to say about this—we shall protect those who need our help most. We do not intend to settle the bills on the backs of the weak, the poor, the old and the children. The policy of the Government is that succour and help for the weak should accompany sacrifice from the strong. When I talk of sacrifice, I do not mean just sacrifice from the individual. I also refer to the local authority which wants to be able to carry out all its cherished schemes. Many local authorities will not be able to take on those schemes for some years to come. It means that Members of Parliament will not get the bypass or hospital they have been seeking.
  Mr. Cyril Smith: I thought I might give the right hon. Gentleman a moment's relief. Is he aware that, far from local authorities not carrying out their cherished schemes, unless they receive some severe financial help from the Government in a matter of weeks they will have to curb their existing services, let alone start new ones?
  Mr. Short: The local authorities have a much bigger growth rate this year than anybody else, and I am afraid that must continue. It means that local authorities will not be able to do all that they wish. It means that Members of Parliament will not get their bypass or their hospital. It means that the universities must defer much-needed building. It means that the profession that insists on preserving the differential with its ancillary workers, the gallery, the theatre or the ballet company will have to tighten its belt a little.

  1019
  It really is no good arguing that it is somebody else's hospital that must go to the end of the queue. We call for sacrifices from everybody who is able to bear them. If we are to convince people of the need for sacrifices we must ensure that they are fairly spread out so that one area of the country, one service or one group of people does not get ahead by trampling on others. The burden must and will be fairly distributed.
  The Government face a daunting prospect. They have to deal with the most appalling balance of payments deficit in our history, which we inherited from the last Conservative Government. They have to cope with inflation, to protect the weak, to safeguard employment, to restore confidence and to revitalise industry. Above all, in order to do this, they have to carry out quite fundamental structural changes in our society. Without them we shall not get the response that is essential to the solving of our problems.
  In any circumstances that would be enough to occupy any Government for five years. That is the position. I believe
  that with the support of the British people, but only with their support, we shall succeed. The Gracious Speech is an earnest of our intentions to do so. It sets out our social, economic and industrial priorities for the first Session of this Parliament. It is the first instalment of Labour's programme for Britain. It will be a massive step towards a fairer and more efficient Britain. I invite the House to endorse this programme in the Division Lobbies tonight.
  9.59 p.m.
  Mr. Patrick Cormack: As I had the privilege of winding up the last debate on the Gracious Speech, I am delighted to have the opportunity this time. The House has just listened to the most uninspiring turgid nonsense. How on earth right hon. and hon. Gentlemen can expect the country to take a lead from the kind of wet cod-fish approach that the right hon. Gentleman has just proclaimed is beyond my comprehension.
  Question put, That the amendment be made: —
  The House divided: Ayes 268, Noes 310.

  Division No. 2.]

  AYES

  [10.0 p.m.

  Aitken, J. W. P.

  Cooke, Robert, (Bristol W.)

  Gilmour, Sir John (East Fife)

  Alison, Michael

  Cope, J. A.

  Glyn, Dr Alan

  Amery, Rt Hn Julian

  Cordle, John

  Goodhart, Philip

  Arnold, Tom

  Cormack, Patrick

  Goodhew, Victor

  Atkins, Rt Hn H. (Spelthorne)

  Corrie, John

  Goodlad, A.

  Awdry, Daniel

  Costain, A. P.

  Gorst, John

  Baker, Kenneth

  Critchley, Julian

  Gow, I. (Eastbourne)

  Banks, R. G.

  Crouch, David

  Cower, Sir Raymond (Barry)

  Bell, Ronald

  Crowder, F. P.

  Grant, Anthony (Harrow C.)

  Bennett, Sir Frederic (Torbay)

  Davies, Rt Hon J. (Knutsford)

  Gray, Hamish

  Bennett, Dr Reginald (Fareham)

  Dean, Paul (N Somerset)

  Grieve, Percy

  Benyon, W. R.

  Dodsworth, G. H.

  Griffiths, Eldon

  Berry, Hon. Anthony

  Douglas-Hamilton, Lord James

  Grist, Ian

  Biffen, John

  Drayson, Burnaby

  Grylls, Michael

  Biggs-Davison, John

  du Cann, Rt Hon Edward

  Hall, Sir John

  Blaker, Peter

  Durant, Tony

  Hall-Davis, A. G. F.

  Body, Richard

  Dykes, Hugh

  Hamilton, Michael (Salisbury)

  Boscawen, Hon Robert

  Eden, Rt Hon Sir John

  Hampson, Dr. Keith

  Bowden, Andrew (Brighton)

  Edwards, Nicholas (Pembroke)

  Hannam, John

  Boyson, Dr Rhodes (Brent)

  Elliott, Sir William

  Harrison, Sir Harwood (Eye)

  Braine, Sir Bernard

  Emery, Peter

  Harvie Anderson, Rt Hn Miss

  Brittan, L.

  Eyre, Reginald

  Hastings, Stephen

  Brotherton, Michael

  Fairnbairn, Nicholas

  Havers, Sir Michael

  Brown, Sir Edward (Bath)

  Farr, John

  Hawkins, Paul

  Bryan, Sir Paul

  Fell, Anthony

  Hayhoe, Barney

  Buchanan-Smith, Alick

  Finsberg, Geoffrey

  Heath, Rt Hon Edward

  Buck, Antony

  Fisher, Sir Nigel

  Heseltine, Michael

  Budgen, N. W.

  Fletcher, Alex (Edinburgh N)

  Hicks, Robert

  Bulmer, J. E.

  Fletcher-Cooke, Charles

  Higgins, Terence L.

  Burden, F. A.

  Fookes, Miss Janet

  Holland, Philip

  Carlisle, Mark

  Fowler, Norman (Sutton C)

  Hordern, Peter

  Carr, Rt Hon Robert

  Fox, Marcus

  Howe, Rt Hon Sir Geoffrey

  Chalker. Mrs Lynda

  Fraser, Rt Hon H. (Stafford & St)

  Howell, David (Guildford)

  Churchill, W. S.

  Fry, Peter

  Howell, Ralph (North Norfolk)

  Clark, Alan (Plymouth S)

  Galbraith, Hon T. G. D.

  Hunt, John

  Clark, William (Croydon S)

  Gardiner, George (Reigate)

  Hurd, D.

  Clarke, Kenneth (Rushcliffe)

  Gardner, Edward (S Fylde)

  Hutchison, Michael Clark

  Clegg, Walter

  Gilmour, Rt Hon Ian (Chesham)

  Irvine, Bryant Godman (Rye)

  Cockcroft, J. H.

  Irving, Charles (Cheltenham)

  Monro, Hector

  Shaw, Michael (Scarborough)

  James, David

  Montgomery Fergus

  Shelton, William (Lambeth, St)

  Jenkin, Rt Hon Patrick (Redbr)

  Moore, John (Croydon C.)

  Shepherd, C.

  Jessel, Toby

  More, Jasper (Ludlow)

  Shersby, Michael

  Johnson Smith, G. (E Grinstead)

  Morgan, Geraint

  Silvester, F.

  Jones, Arthur (Daventry)

  Morgan-Giles, Rear-Admiral

  Sims, Roger

  Jopling, Michael

  Morris, Michael (Northants)

  Sinclair, Sir George

  Joseph, Rt Hon Sir Keith

  Morrison, Charles (Devizes)

  Skeet, T. H. H.

  Kaberry, Sir Donald

  Morrison, Peter (Chester)

  Smith, Dudley (Warwick)

  Kellett-Bowman, Mrs. Elaine

  Mudd, David

  Speed, Keith

  Kershaw, Anthony

  Neave, Airey

  Spence, John

  Kilfedder, James

  Nelson, R.

  Spicer, James (W Dorset)

  Kimball, Marcus

  Neubert M.

  Spicer, Michael (S Worcester)

  King, Evelyn (South Dorset)

  Newton, A.

  Sproat, Iain

  King, Tom (Bridgwater)

  Normanton, Tom

  Stainton Keith

  Kirk, Peter

  Nott, John

  Stanbrook, Ivor

  Kitson, Sir Timothy

  Onslow, Cranley

  Stanley, John

  Knight, Mrs Jill

  Oppenheim, Mrs Sally

  Steen, Anthony (Liverpool)

  Knox. David

  Osborn, John

  Stewart, Ian (Hitchin)

  Lamont, Norman

  Page, Rt Hon R. Graham (Crosby)

  Stokes, John

  Lane, David

  Page, John (Harrow West)

  Tapsell, Peter

  Langford-Holt, Sir John

  Parkinson, Cecil

  Taylor, R. (Croydon N.W.)

  Latham, Michael (Melton)

  Pattie, Geoffrey

  Taylor, Teddy (Glasgow, C)

  Lawrence, I.

  Percival, Ian

  Tebbit, Norman

  Lawson, Nigel

  Peyton, Rt Hon John

  Temple-Morris, P.

  Le Marchant, Spencer

  Pink, R. Bonner

  Thatcher, Rt Hon M.

  Lester, Jim (Beeston)

  Price, David (Eastleigh)

  Thomas, Rt Hon P. (Barnet)

  Lewis, Kenneth (Rutland)

  Prior, Rt Hon James

  Townsend, Cyril D.

  Lloyd, Ian (Havant)

  Pym, Rt Hon Francis

  Trotter, Neville

  Loveridge, John

  Raison, Timothy

  Tugendhat, Christopher

  Luce, Richard

  Rathbone, T.

  van Straubenzee, W. R.

  McAdden, Sir Stephen

  Rawlinson, Rt Hon Sir Peter

  Vaughan, Dr Gerard

  McCrindle, Robert

  Rees, Peter (Dover & Deal)

  Viggers, P. J.

  Macfarlane, Neil

  Rees-Davies, W. R.

  Wakeham, John

  MacGregor, John

  Renton, Rt Hn Sir D. (Hunts)

  Walder David (Clitheroe)

  Macmillan, Rt Hn M. (Farnham)

  Renton, Tim (Mid-Sussex)

  Walker Rt Hon P. (Worcester)

  McNair-Wilson, M. (Newbury)

  Rhys Williams, Sir Brandon

  Walker-Smith, Rt Hon Sir Derek

  McNair-Wilson, P. (New Forest)

  Ridley, Hon Nicholas

  Wall, Patrick

  Madel, David

  Ridsdale, Julian

  Walters, Dennis

  Marshall, Michael (Arundel)

  Rifkind, Malcolm

  Warren, Kenneth

  Marten, Neil

  Rippon, Rt Hon Geoffrey

  Weatherill, Bernard

  Mates, M.

  Roberts, Michael (Cardiff NW)

  Wells, John

  Mather, Carol

  Roberts, Wyn (Conway)

  Whitelaw, Rt Hon William

  Maude, Angus

  Rodgers, Sir John (Sevenoaks)

  Wiggin, Jerry (Weston-s-Mare)

  Mawby, Ray

  Rossi Hugh (Hornsey)

  Winterton, Nicholas

  Maxwell-Hyslop, Robin

  Rost, Peter (S.E. Derbyshire)

  Wood, Rt Hon Richard

  Mayhew, Patrick

  Royle, Sir Anthony

  Young, Sir George (Ealing)

  Meyer, Sir Anthony

  Sainsbury, Tim

  Younger, Hon George

  Miller, Hal (Bromsgrove)

  St. John-Stevas, Norman

  Mills. Peter

  Scott, N.

  TELLERS FOR THE AYES:

  Miscampbell, Norman

  Scott-Hopkins, James

  Mr. Adam Butler and

  Mitchell. David (Basingstoke)

  Shaw, Giles (Pudsey)

  Mr. John Stradling Thomas.

  Moate, Roger

  NOES

  Abse, Leo

  Buchan, Norman

  Cunningham, Dr J. (Whiteh)

  Allaun, Frank

  Buchanan, Richard

  Dalyell, Tam

  Anderson, D.

  Butler, Mrs Joyce (Haringey)

  Davidson, Arthur

  Archer, Peter

  Callaghan, Rt Hon J. (Cardiff S)

  Davies, Bryan (Enfield N)

  Armstrong, Ernest

  Callaghan, Jim (Middleton & P)

  Davies, Denzil (Llanelli)

  Ashley, Jack

  Campbell, Ian

  Davies, Ifor (Gower)

  Ashton Joe

  Canavan, D.

  Davis, S. Clinton (Hackney C)

  Atkinson, Norman

  Cant, R. B.

  Deakins, Eric

  Bagier, Gordon A. T.

  Carmichael, Neil

  Dean, Joseph (Leeds West)

  Barnett, Guy (Greenwich)

  Carter, Ray

  de Freitas, Rt Hon Sir Geoffrey

  Barnett, Joel (Heywood)

  Carter-Jones, Lewis

  Delargy, Hugh

  Bates, Alf

  Cartwright, J.

  Dell, Rt Hon Edmund

  Bean, R.

  Castle, Rt Hon Barbara

  Dempsey, James

  Benn, Rt Hn Anthony Wedgwood

  Clemitson, I. M.

  Doig, Peter

  Bennett, A. (Stockport North)

  Cocks, Michael (Bristol S)

  Dormand, Jack

  Bidwell, Sydney

  Cohen, Stanley

  Douglas-Mann, Bruce

  Bishop, Edward

  Coleman, Donald

  Duffy, A. E. P.

  Blenkinsop, Arthur

  Colquhoun, Mrs Maureen

  Dunn, James A.

  Boardman, H.

  Concannon, J. D.

  Dunnett, Jack

  Booth, Albert

  Conlan, Bernard

  Dunwoody, Mrs G. P.

  Boothroyd, Miss Betty

  Cook, Robin F. (Edin. C.)

  Eadie, Alex

  Bottomley, Rt Hon Arthur

  Corbett, R.

  Edelman, Maurice

  Boyden, James (Bish Auck)

  Cox, Thomas (Wands Toot)

  Edge, Geoffrey

  Bradley, Tom

  Craigen, J. M. (Glasgow, M)

  Edwards, Robert (Wolv SE)

  Bray, J

  Crawshaw, Richard

  Ellis, Tom (Wrexham)

  Broughton, Sir Alfred

  Cronin, John

  English, Michael

  Brown, Hugh D. (Glasgow, Pr)

  Crosland, Rt Hon Anthony

  Evans, Fred (Caerphilly)

  Brown, Robert C. (Newcastle)

  Cryer, G. R.

  Evans, Ioan L. (Aberdare)

  Brown, Ronald (Hackney S)

  Cunningham, G. (Islington S)

  Evans, John (Newton)

  1022

  1023

  Ewing, Harry (Stirling)

  Lewis, Ron (Carlisle)

  Roper, John

  Faulds, Andrew

  Lipton, Marcus

  Rose, Paul B.

  Fernyhough, Rt Hon E.

  Litterick, Tom

  Ross, Rt Hon W. (Kilm'nock)

  Fitch, Alan (Wigan)

  Lomas, Kenneth

  Rowlands, Ted

  Fitt, Gerard (Belfast)

  Luard, Evan

  Ryman, John

  Flannery, Martin

  Lyon, Alexander (York)

  Sandelson, Neville

  Fletcher, Raymond (Ilkeston)

  Lyons, Edward (Bradford W.)

  Sedgemore, B.

  Fletcher, Ted (Darlington)

  Mabon, Dr J. Dickson

  Selby, Harry

  Foot, Rt Hon Michael

  McCartney, Hugh

  Shaw, Arnold (Redbridge, Ilf)

  Ford, Ben I.

  McElhone, Frank

  Sheldon, R. (Ashton-u-Lyne)

  Forrester, John

  MacFarquhar, R.

  Shore, Rt Hon Peter

  Fowler, Gerald (The Wrekin)

  McGuire, Michael (Ince)

  Short, Rt Hon E. (Newcastle C)

  Fraser, John (Lambeth N)

  Mackenzie, Gregor

  Short, Mrs R. (Wolv NE)

  Freeson, Reginald

  Maclennan, Robert

  Silkin, Rt Hn John (Lewish)

  Garrett, John (Norwich S)

  McMillan, Tom (Glasgow C.)

  Silkin, Rt Hn S. C. (Southwk)

  Garrett, W. (Wallsend)

  McNamara, Kevin

  Sillars, James

  George, Bruce

  Madden, Max

  Silverman, Julius

  Gilbert, Dr John

  Magee, Bryan

  Skinner, Dennis

  Ginsburg, David

  Mahon, Simon

  Small, William

  Golding, John

  Mallalieu, J. P. W.

  Smith, John (N Lanarkshire)

  Gould, Bryan

  Marks, Ken

  Snape, Peter

  Gourlay, Harry

  Marquand, David

  Spearing, Nigel

  Graham, Ted

  Marshall, Dr Edmund (Goole)

  Spriggs, Leslie

  Grant, George (Morpeth)

  Marshall, Jim (Leicester S)

  Stallard, A. W.

  Grant, John (Islington C.)

  Mason, Rt Hon Roy

  Stewart, Rt Hn M. (H'smith F)

  Grocott, Bruce

  Maynard, Miss Joan

  Stoddart, David

  Hamilton, James (Bothwell)

  Meacher, Michael

  Stonehouse, Rt Hn John

  Hamilton, W. W. (Central Fife)

  Mellish, Rt Hon Robert

  Stott, Roger

  Hamling, William

  Mendelson, John

  Strang, Gavin

  Hardy, Peter

  Mikardo, Ian

  Strauss, Rt Hon G. R.

  Harper, Joseph

  Millan, Bruce

  Summerskitl, Hon Dr Shirley

  Harrison, Walter (Wakefield)

  Miller, Dr M. (E. Kilbride)

  Swain, Thomas

  Hart, Rt Hon Judith

  Miller, Mrs Millie (Redbridge)

  Taylor, Mrs Ann (Bolton (W)

  Hattersley, Roy

  Mitchell, R. C. (Soton, Itchen)

  Thomas, Jeffrey (Abertillery)

  Hatton, Frank

  Molloy, William

  Thomas, Mike (Newcastle)

  Hayman Mrs Helene

  Moonman, Eric

  Thomas, Ron (Bristol NW)

  Healey, Rt Hon Denis

  Morris, Alfred (Wythenshawe)

  Thorne, S. G. (Preston)

  Heffer, Eric S.

  Morris, Charles R. (Openshaw)

  Tierney, Sydney

  Hooley, Frank

  Morris, Rt Hon J. (Aberavon)

  Tinn, James

  Horam, John

  Moyle, Roland

  Tomlinson, J.

  Howell, Denis (B'ham Sm H)

  Mulley, Rt Hon Frederick

  Tomney, Frank

  Huckfield, Leslie

  Murray, Ronald King

  Torney, Tom

  Hughes, Rt Hon C. (Anglesey)

  Newens, S.

  Tuck, Raphael

  Hughes, Mark (Durham)

  Noble, Mike

  Urwin, T. W.

  Hughes, Robert (Aberdeen N)

  Oakes, Gordon

  Varley, Rt Hon Eric G.

  Hughes, Roy (Newport)

  Ogden, Eric

  Wainwright, Edwin (Dearne V)

  Hunter, Adam

  O'Halloran, Michael

  Walker, Harold (Doncaster)

  Irvine, Rt. Hon Sir A. (L'pool)

  O'Malley, Brian

  Walker, Terry (Kingswood)

  Irving, Rt Hon S. (Dartford)

  Orbach, Maurice

  Ward, Michael

  Jackson, Colin (Brighouse)

  Orme, Rt Hn Stanley

  Watkins, David

  Jackson, Miss Margaret (Lincoln)

  Ovenden, J.

  Watkinson, John

  Janner, Greville

  Owen, Dr David

  Weetch, Ken

  Jay, Rt Hon Douglas

  Padley, Walter

  Weitzman, David

  Jeger, Mrs Lena

  Palmer, Arthur

  Wellbeloved, James

  Jenkin, Rt Hon Patrick (Redbr)

  Park, G.

  White, Frank (Bury)

  Jenkins, Hugh (Wandsworth)

  Parker, John

  White, James (Glasgow P)

  John, Brynmor

  Parry, Robert

  Whitehead, Phillip

  Johnson, James (Kingston W)

  Pavitt, Laurie

  Whitlock, William

  Jones, Barry (East Flint)

  Pendry, Tom

  Willey, Rt Hon Frederick

  Jones, Dan (Burnley)

  Perry, Ernest

  Williams, Alan (Swansea)

  Jones, Alec (Rhondda)

  Phipps, Dr C.

  Williams, A. L. (Havering)

  Judd, Frank

  Prentice, Rt Hon Reg

  Williams, Rt Hn Mrs S. (Hertford)

  Kaufman, Gerald

  Prescott, John

  Williams, W. T. (Warrington)

  Kelley, Richard

  Price, C. (Lewisham W.)

  Wilson, Alexander (Hamilton)

  Kerr, Russell

  Price, William (Rugby)

  Wilson, Rt Hon H. (Huyton)

  Kilroy-Silk, Robert

  Radice, Giles

  Wilson, William (Coventry SE)

  Kinnock, Neil

  Rees, Rt Hon Merlyn (Leeds S)

  Wise, Mrs. Audrey

  Lambie, David

  Richardson, Miss Jo

  Woodall, A.

  Lamborn, Harry

  Roberts, Albert (Normanton)

  Woof, Robert

  Lamond, James

  Roberts, Gwilym (Cannock)

  Wrigglesworth, Ian

  Latham, Arthur (Paddington)

  Robertson, John (Paisley)

  Young, David (Bolton E)

  Leadbitter, Ted

  Roderick, Caerwyn

  Lee, John

  Rodgers, George (Chorley)

  TELLERS FOR THE NOES:

  Lestor, Miss J. (Eton & Slough)

  Rodgers, William (Teesside)

  Mr. John Ellis and

  Lever, Rt Hn Harold

  Rooker, J. W.

  Mr. Walter Johnson.

  Lewis, Arthur (Newham N.)

  Question accordingly negatived.
  Main Question put:—
  The House divided: Ayes 308, Noes 14.

  Division No. 3.]

  AYES

  [10.13 p.m.

  Abse, Leo

  Edelman, Maurice

  Lestor, Miss J. (Eton & Slough)

  Allaun, Frank

  Edge, Geoffrey

  Lever, Rt Hn Harold

  Anderson, Donald

  Edwards, Robert (Wolv SE)

  Lewis, Arthur (Newham N.)

  Archer, Peter

  Ellis, Tom (Wrexham)

  Lewis, Ron (Carlisle)

  Armstrong, Ernest

  English, Michael

  Lipton, Marcus

  Ashley, Jack

  Evans, Fred (Caerphilly)

  Litterick, Tom

  Ashton, Joe

  Evans, Ioan L. (Aberdare)

  Lomas Kenneth

  Atkinson, Norman

  Evans, John (Newton)

  Luard, Evan

  Bagier, Gordon A. T.

  Ewing, Harry (Stirling)

  Lyon, Alexander (York)

  Barnett, Guy (Greenwich)

  Faulds, Andrew

  Lyons, Edward (Bradford W.)

  Barnett, Joel (Heywood)

  Fernyhough, Rt Hon E.

  Mabon, Dr J. Dickson

  Bates, Alf

  Fitch, Alan (Wigan)

  McCartney, Hugh

  Bean Robert E.

  Flannery, Martin

  McElhone, Frank

  Benn, Rt Hn Anthony Wedgwood

  Fletcher, Raymond (Ilkeston)

  MacFarquhar, R.

  Bennett, A. (Stockport North)

  Fletcher, Ted (Darlington)

  McGuire, Michael (Ince)

  Bidwell, Sydney

  Foot, Rt Hon Michael

  Mackenzie, Gregor

  Bishop, Edward

  Ford, Ben T.

  Maclennan, Robert

  Blenkinsop, Arthur

  Forrester, John

  McMillan, Tom (Glasgow C.)

  Boardman, H.

  Fowler, Gerald (The Wrekin)

  McNamara, Kevin

  Booth, Albert

  Fraser, John (Lambeth N)

  Madden, Max

  Boothroyd, Miss Betty

  Freeson, Reginald

  Magee, Bryan

  Bottomley, Rt Hon Arthur

  Garrett, John (Norwich S)

  Mahon, Simon

  Boyden, James (Bish Auck)

  Garrett, W. (Wailsend)

  Mallalieu, J. P. W.

  Bradley, Tom

  George, Bruce

  Marks, Ken

  Bray, Dr Jeremy

  Gilbert, Dr John

  Marquand, David

  Broughton, Sir Alfred

  Ginsburg, David

  Marshall, Dr Edmund (Goole)

  Brown, Hugh D. (Glasgow, Pr)

  Golding, John

  Marshall, Jim (Leicester S)

  Brown, Robert C. (Newcastle)

  Gould, Bryan

  Mason, Rt Hon Roy

  Brown, Ronald (Hackney S)

  Gourlay, Harry

  Maynard, Miss Joan

  Buchan, Norman

  Graham, Ted

  Meacher, Michael

  Buchanan, Richard

  Grant, George (Morpeth)

  Mellish, Rt Hon Robert

  Butler, Mrs Joyce (Haringey)

  Grant, John (Islington C.)

  Mendelson, John

  Callaghan, Rt Hon J. (Cardiff S)

  Grocott, Bruce

  Mikardo, Ian

  Callaghan, Jim (Middleton & P)

  Hamilton, James (Bothwell)

  Millan, Bruce

  Campbell, Ian

  Hamilton, W. W. (Central File)

  Miller, Dr M. (E. Kilbride)

  Canavan, Dennis

  Hamling, William

  Miller, Mrs Millie (Redbridge)

  Cant, R. B.

  Hardy, Peter

  Mitchell, R. C. (Solon, Itchen)

  Carmichael, Neil

  Harper, Joseph

  Molloy, William

  Carter, Ray

  Harrison, Walter (Wakefield)

  Moonman, Eric

  Carter-Jones, Lewis

  Hart, Rt Hon Judith

  Morris, Alfred (Wythenshawe)

  Cartwright, John

  Hattersley, Roy

  Morris, Charles R. (Openshaw)

  Castle, Rt Hon Barbara

  Hatton, Frank

  Morris, Rt Hon J. (Aberavon)

  Clemitson, I. M.

  Hayman, Mrs Helene

  Moyle, Roland

  Cocks, Michael (Bristol S)

  Healey, Rt Hon Denis

  Mulley, Rt Hon Frederick

  Cohen, Stanley

  Heffer, Eric S.

  Murray, Ronald King

  Coleman, Donald

  Hooley, Frank

  Newens, S.

  Colquhoun, Mrs Maureen

  Horam, John

  Noble, Mike

  Concannon, J. D.

  Howell, Denis (B'ham Sm H)

  Oakes, Gordon

  Conlan, Bernard

  Huckfield, Leslie

  Ogden, Eric

  Cook, Robin F. (Edin. C.)

  Hughes, Rt Hon C. (Anglesey)

  O'Halloran, Michael

  Corbett, Robin

  Hughes, Mark (Durham)

  O'Malley, Brian

  Cox, Thomas (Wands Toot)

  Hughes, Robert (Aberdeen N)

  Orbach, Maurice

  Craigen, J. M. (Glasgow, M)

  Hughes, Roy (Newport)

  Orme, Rt Hn Stanley

  Crawshaw, Richard

  Hunter, Adam

  Ovenden, J.

  Cronin, John

  Irving, Rt Hon S. (Dartford)

  Owen, Dr David

  Crosland, Rt Hon Anthony

  Jackson, Colin (Brighouse)

  Padley, Walter

  Cryer, G. R.

  Jackson, Miss Margaret (Lincoln)

  Palmer, Arthur

  Cunningham, G. (Islington S)

  Janner, Greville

  Park, G.

  Cunningham, Dr J. (Whiteh)

  Jay, Rt Hon Douglas

  Parker, John

  Dalyell, Tam

  Jeger, Mrs Lena

  Parry, Robert

  Davidson, Arthur

  Jenkins, Hugh (Wandsworth)

  Pavitt, Laurie

  Davies, Bryan (Enfield N)

  Jenkins, Rt Hon Roy (B'ham St)

  Pendry, Tom

  Davies, Denzil (Llanelli)

  John, Brynmor

  Perry, Ernest

  Davies, Ifor (Gower)

  Johnson, James (Kingston W)

  Phipps, Dr C.

  Davis, S. Clinton (Hackney C)

  Jones, Barry (East Flint)

  Prentice, Rt Hon Reg

  Deakins, Eric

  Jones, Dan (Burnley)

  Prescott, John

  Dean, Joseph (Leeds West)

  Jones, Alec (Rhondda)

  Price, C. (Lewisham W.)

  de Freitas, Rt Hon Sir Geoffrey

  Judd, Frank

  Price, William (Rugby)

  Delargy, Hugh

  Kaufman, Gerald

  Radice, Giles

  Dell, Rt Hon Edmund

  Kelley, Richard

  Rees, Rt Hon Merlyn (Leeds S)

  Dempsey, James

  Kerr, Russell

  Richardson, Miss Jo

  Doig, Peter

  Kilroy-Silk, Robert

  Roberts, Albert (Normanton)

  Dormand, Jack

  Kinnock, Neil

  Roberts, Gwilym (Cannock)

  Douglas-Mann, Bruce

  Lambie, David

  Robertson, John (Paisley)

  Duffy, A. E. P.

  Lamborn, Harry

  Roderick, Caerwyn

  Dunn, James A.

  Lamond, James

  Rodgers, George (Chorley)

  Dunnett, Jack

  Latham, Arthur (Paddington)

  Rodgers, William (Teesside)

  Dunwoody, Mrs G. P.

  Leadbitter, Ted

  Rooker, J. W.

  Eadie, Alex

  Lee, John

  Roper, John

  Rose, Paul B.

  Stonehouse, Rt Hn John

  Watkinson, John

  Ross, Rt Hon W. (Kilm'nock)

  Stott, Roger

  Weetch, Ken

  Rowlands, Ted

  Strang, Gavin

  Weitzman, David

  Ryman, John

  Strauss, Rt Hon G. R.

  Wellbeloved, James

  Sandelson, Neville

  Summerskill, Hon Dr Shirley

  White, Frank (Bury)

  Sedgemore, B.

  Swain, Thomas

  White, James (Glasgow P)

  Selby, Harry

  Taylor, Mrs Ann (Bolton W)

  Whitehead, Phillip

  Shaw, Arnold (Redbridge, Ilf)

  Thomas, Jeffrey (Abertillery)

  Whitlock, William

  Sheldon, R. (Ashton-u-Lyne)

  Thomas, Mike (Newcastle)

  Willey, Rt Hon Frederick

  Shore, Rt Hon Peter

  Thomas, Ron (Bristol NW)

  Williams, Alan (Swansea)

  Short, Rt Hon E, (Newcastle C)

  Thorne, S. G. (Preston)

  Williams, A. L. (Havering)

  Short, Mrs R. (Wolv NE)

  Tierney, Sydney

  Williams, Rt Hn Mrs S. (Hertford)

  Silkin, Rt Hn S. C. (Southwk)

  Tinn, James

  Williams, W. T. (Warrington)

  Silkin, Rt Hn John (Lewish)

  Tomlinson, J.

  Wilson, Alexander (Hamilton)

  Sillars, James

  Tomney, Frank

  Wilson, Rt Hon H. (Huyton)

  Silverman, Julius

  Torney, Tom

  Wilson, William (Coventry SE)

  Skinner, Dennis

  Tuck, Raphael

  Wise, Mrs. Audrey

  Small, William

  Urwin, T. W.

  Woodall, A.

  Smith, John (N Lanarkshire)

  Varley, Rt Hon Eric G.

  Woof, Robert

  Snape, Peter

  Wainwright, Edwin (Dearne V)

  Wrigglesworth, Ian

  Spearing, Nigel

  Walden, Brian (B'ham, L'dyw'd)

  Young, David (Bolton E)

  Spriggs, Leslie

  Walker, Harold (Doncaster)

  Stallard, A. W.

  Walker, Terry (Kingswood)

  TELLERS FOR THE AYES:

  Stewart, Rt Hn M. (H'smith F)

  Ward, Michael

  Mr. John Ellis and

  Stoddart, David

  Watkins, David

  Mr. Walter Johnson.

  NOES

  Beith, A. J.

  Penhaligon, David

  Wainwright, R. (Colne Valley)

  Freud, Clement

  Ross, Stephen (Isle of Wight)

  Winterton, Nicholas

  Grimond, Rt Hon J.

  Rost, Peter (S.E. Derbyshire)

  Hooson, Emlyn

  Scott-Hopkins, James

  TELLERS FOR THE NOES:

  Howells, Geraint (Cardigan)

  Smith, Cyril (Rochdale)

  Mr. John Pardoe and

  Kilfedder, James

  Thorpe, Rt Hon Jeremy (Devon)

  Mr. David Steel.

  Question accordingly agreed to.
  Resolved,
  That an humble Address be presented Her Majesty, as follows:
  Most Gracious Sovereign,
  We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom
  1028
  of Great Britain and Northern Ireland. in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has to addressed to both Houses of Parliament.
  To be presented by Privy Councillors or Members of Her Majesty's Household.

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

  HOSPITALS (SUTTON AND CHEAM)
  10.30 p.m.
  Mr. Neil MacFarlane: I am grateful for this opportunity to raise on the Adjournment an issue of great importance to my constituents and constituency. I begin by congratulating the Under-Secretary on his appointment to the Front Bench and wish him well. I am certain that in his constituency in Rhondda he will suffer from the same problems as those which I seek to highlight tonight.
  The future of the Belmont and Henderson hospital sites in the constituency of Sutton and Cheam has for some years created much rumour, concern and dissent. During the last Parliament I corresponded with the Minister's predecessor about the future of these hospital sites. The two hospitals occupy 55 acres within my constituency. They have been in existence for about 100 years and we understand that the South-West Thames Regional Health Authority is considering closing the hospitals.
  These hospitals are essentially centres for therapy treatment, for treating general psychiatric disorders and for carrying out remedial treatment on people, aged between 18 and 35, with personal disorders. These people are sent there either on the recommendation of their doctors or a hospital or by the magistrates.
  Over the past few months the Department of Health and Social Security has not been specific in answering my questions about the detailed timing of the closures. I understood from a letter written in July by the then Under-Secretary of State for Health—now the Minister of State—that it was likely that the closure of the Henderson Hospital would take place later this year and that the termination of the Belmont Hospital would take place as soon as alternative accommodation could be located. The anticipated date was October 1975. It is important to voice the concern of my constituents about the intentions of the
  1030
  Department and the Greater London Council.
  There are two points to be considered. First, during August I spent some time researching in my constituency into the many problems affecting the elderly in our society. I visited old people's homes and all the day centres, and I even went out with the meals-on-wheels service. I am happy to say that for two days I served 66 mid-day meals to senior citizens. I felt that this gave me an insight into the problems from which other hon. Members must suffer in their constituencies. I am certain that this difficulty exists in the Principality. I know that the Minister will have conducted similar surveys in his constituency and I am confident that he will understand my concern about the premature closing of these two hospitals.
  There is a growing requirement within my constituency and within the South-West Thames Regional Hospital Authority area for more geriatric centres. In my borough, which covers two parliamentary constituencies, there has been a reduction in the number of beds available for geriatric cases.
  In reply to my Question on 19th July, the Under-Secretary of State demonstrated the enormous increase in the number of geriatric cases. Between 1970 and 1973 the number of geriatric cases in the United Kingdom rose from 170,000 to nearly 190,000. I am concerned that two hospitals may be closed prematurely when an alternative use for them could be found. Several hospitals are reducing the number of beds available for geriatrics.
  I earnestly hope that the Minister will pass to the South-West Thames Regional Health Authority my suggestion that these two hospitals should not be closed but should be retained for use as geriatric centres, catering not necessarily for the London Borough of Sutton but a far far wider area within the regional health authority, perhaps going into Surrey and Sussex, which will be necessary by 1985. They would thus assist many residents over a wide area.
  I accept that the cost of retaining, renovating and converting the two hospitals will be high, but by 1980 the problems of our senior citizens will be infinitely greater than they are now. It

  1031
  would be foolhardy for the health authority to bulldoze these two National Health Service hospitals.
  There are 55 acres of land surrounding the two hospitals. We in the London Borough of Sutton are concerned about the future of the remaining land even if the two hospitals are retained. I hope that the Minister will convey to his right hon. Friend that any land which is released by the Department of Health and Social Security should first be offered to the London Borough of Sutton. There are several ways in which the land could be used. There is urgent need for more housing in the Greater London area and the availability of the land would enable the London Borough of Sutton to catch up on its housing programme for both council housing and private development.
  Within the recent past we have had London overspill developments in the area. We welcome the residents who have come from the inner London area into the constituency, and we hope that they are happy there. They have settled in well, but they have placed a tremendous pressure upon the ancillary services which are so essential to society. There will be grave sociological problems if we are unable to provide all the services we require within the next ten years. The London Borough of Sutton could use the land for the erection of primary and secondary schools. We need more old people's homes and an old people's day centre. Most important of all is the inclusion of recreational facilities. I hope that all these facilities will be taken into consideration.
  I earnestly hope that the Minister will convey my sentiments to his right hon. Friend the Secretary of State. It is vital that this land be clearly designated for the use of the London Borough of Sutton. I hope that the Minister will give an indication of the future timing for the disposal of any part of the 55 acres which his Department will not require and of the current plans. I cannot emphasise too strongly that we in the London Borough of Sutton, and in my constituency which covers Sutton, Cheam and Worcester Park, have heard many rumours without knowing what the precise course of action is to be. In reply to my letter seeking fuller details about the intentions for these two hospital sites,
  1032
  the Minister's colleague was not very specific on 11th July. They concern us greatly. It is essential that we know what the plans are.
  I hope that the Minister will be able to convince the South-West Thames Regional Health Authority of the genuine need in the borough and outside my constituency for some consideration to be given to the problems of old age and our senior citizens who by 1985 will require more and more treatment. There is also the need for greater training facilities for nursing staff so that the affliction of old age and problems associated therewith can be tackled.
  10.42 p.m.
  The Under-Secretary of State for Health and Social Security (Mr. Alec Jones): I am grateful to the hon. Member for Sutton and Cheam (Mr. MacFarlane) for his kind words at the outset of his speech. I am flattered that my interest in the welfare of old people in the Rhondda should be known as far afield as Sutton and Cheam.
  I agree that the hon. Gentleman has shown great energy and persistence in pursuing this matter. I have studied the letters, the parliamentary Questions, and the papers available in the Department. The hon. Gentleman has raised three major issues which are related but which have a distinct pattern—first, the present position and the future of the two hospitals; secondly, the general provision for geriatrics in the area; and, thirdly, the future of the site.
  The hon. Gentleman referred to rumour, concern and dissent. I will do my best to deal with that and I will be as forthright as I can be. The hon. Gentleman will realise as I proceed that it is not possible to be absolute in giving times for closures of hospitals when we have to deal with such complicated matters as the site now occupied by the Belmont and Henderson Hospitals.
  We must remember that Belmont Hospital was established in 1853 as an orphanage. It became a workshop. During the First World War it served as a prisoner-of-war camp. It then became an industrial colony. During the Second World war it was an EMS hospital and then a specialist unit dealing with neurosis.

  1033
  I understand that, as long ago as 1969, the former South-West Metropolitan Regional Hospital Board decided that there was a need to replace the buildings at the Belmont Hospital as part of the development of long-term plans for psychiatric services in this area. This hospital, as of course the hon. Gentleman knows, deals with the treatment of general psychiatric conditions, and has traditionally taken patients from a fairly wide catchment area—patients who have been drawn to it by its reputation.
  The Belmont Hospital buildings are themselves now scheduled to be closed following the completion and commissioning of the nearby Sutton Hospital's new psychiatric unit; and the South-West Thames Regional Health Authority, which has assumed the former board's responsibilities, anticipated that this unit of 120 beds and 120 day places will be operational during the next five months. The Belmont Hospital part of the joint site should therefore be emptied early next year. Therefore, the Belmont Hospital, having rendered a variety of services in its time, is to move to new and pleasant surroundings. I trust that the staff and patients will be happy in their new surroundings and that there will be a greater degree of efficiency.
  This unusual and impressive unit tackles a spectrum of mental and social illnesses which have been shunned by many hospitals. It thus offers a valuable service to phychiatrists, social services departments and the Home Office. An enthusiastic and capable staff have fully developed the team approach to treatment.
  This experiment was set up by Dr. Maxwell Jones, and the fame of the hospital is world wide, particularly in the psychiatric world. It has accommodation for 48 male and 20 female patients and its bed occupancy seldom exceeds 50. The regional hospital authority has been considering the former regional hospital board's plans to move the hospital to a separate building in the grounds of Ban-stead Hospital. Unfortunately, at Ban-stead there have been slight structural defects and it is not now expected that the move can take place for at least two years.
  Mr. MacFarlane: The Minister referred to the impressiveness of the Bel-
  1034
  mont and Henderson Hospitals. Having made a couple of visits to the latter, I think the hon. Gentleman is looking at the hospital with a degree of optimism. I can only assume that the hospital has not been inspected recently. It is not an impressive unit. It is an antiquated building and in a condition of severe dilapidation. It is a cause for concern in my constituency because of the law-breaking activities of many patients. I wish to emphasise that the Henderson hospital is far from impressive.
  Mr. Jones: I was not trying to convey the impression that all is right with the physical buildings of the Henderson Hospital. I was trying to emphasise the importance in the psychiatric world that is attached to the type of work being undertaken in the Henderson Hospital. It was in that sense I made use of the word "impressive".
  Inspections have been carried out. The regional health authority believes that patients should be encouraged to keep their environment clean, both as part of their treatment and in order to help them to lead a natural life in future. They are encouraged to keep their accommodation in reasonable condition and to carry out minor decorations themselves. I understand that large-scale redecoration of wards is currently planned. On the assumption that the hospital will not be moving in the immediate future, the health authorities will also be considering replacement of a number of items of furniture. There is an awareness of the physical problems attached to the hospital.
  I turn to the general question of geriatric provision in the area. I compliment the hon. Gentleman on the visits that he has made and the work that he has undertaken for the old people in his constituency, for I am fully aware of his admirable interest in the development of facilities for geriatric patients. I assure him that consideration of the needs of psychiatric and geriatric patients—in other words, of those patients currently using this site and those whom he might wish to see there—has been amongst the highest priorities for early consideration by the Merton, Sutton and Wandsworth Area Health Authority in whose area these hospitals lie.
  The total number of geriatric beds in this area is, I understand, approximately

  1035
  930 or 9·9 per 1,000 of the population over 65 years of age. That compares favourably with the national average of 8·83. Moreover, by 1981 the population of the area is likely to have fallen by 50,000. No reliable population estimates are available after 1981, but it can be assumed that the population in London is unlikely to increase in the following decade. I have no doubt that the relevant authorities will be carefully planning the proper spread of bed provision in this specialty and the maintenance of proper standards in both district general and other hospitals.
  Mr. MacFarlane: It is all very well to suggest that the population of Greater London will decline over the next decade, but the problem facing the outer London boroughs is acute and critical. Unless the Department has made some accurate projections over the next 10 to 15 years I feel that it will be ignoring the depth of the geriatric problem up to 1990. I should be interested to know—perhaps the hon. Gentleman could write to me—what the projections are and the numbers of beds being planned and prepared for geriatric cases in the next decade.
  Mr. Jones: I cannot give the detailed answer that the hon. Gentleman would like. The Department's recommendation is that five beds per 1,000 population over the age of 65 should be provided in, and five more outside, the general hospital in each district. It is on that basis that planning is taking place for the provision of geriatric places in this area.
  The hon. Gentleman will be pleased to learn that Sutton and West Merton, in which district the hospitals that we are now considering lie, has been amongst the first districts in the country to set up what will become a geriatric "health care planning team". It is therefore energetically considering all forms of geriatric provision. I will convey to this body the suggestions that the hon. Gentleman has made tonight. I am sure that it will take account of his views in considering provision for geriatric cases.
  I should like to comment about the future of the site on the assumption that both hospitals will at some stage be closed. Obviously this site, whether of 49 acres, according to my information, or
  1036
  55 acres, according to the hon. Gentleman, is of considerable value. Its acquisition is an attractive proposition to many bodies, including the Sutton authority and others who may be interested. Obviously we must ensure that whatever we do this valuable site is used for good social reasons.
  As my hon. Friend the Minister or State explained to the hon. Gentleman in answer to questions earlier this year, the regional health authority still has to make sure that it does not require either the existing hospital buildings or any part of the site for other hospital or, indeed, any health purposes once the Belmont and Henderson hospital buildings are vacated. After tonight's debate, of course, the authority may be further influenced to retain parts of that site for geriatric use.
  The hon. Member will be only too well aware of the demands being made on this authority, as on each of the newly-established health authorities, not only in terms of plans to be made but of resources with which to fulfil these new demands. In this particular case, the possible uses to which part at least of the site could be put include that of a site for its own or for the district management team's administrative offices.
  The hon. Member will appreciate that, in view of the large number of unknowns, it has not been possible to determine what should be the future of this site in the event of the health authorities not requiring it all. The Secretary of State has now been asked for formal approval to the closure of the buildings but we are awaiting the outcome of discussions between the South West Thames Regional Health Authority, the Merton, Sutton and Wandsworth Area Health Authority and the newly-set up Community Health Council which must now be consulted. Obviously, the reorganisation of the health service has played a part in the delay here.
  Should the buildings and site indeed be declared surplus to National Health Service use, then the usual procedure will be followed. The regional health authority must first establish whether there is a local authority need for a personal social service function. If there is, then this will take precedence over any other non-health use. Otherwise

  1037
  offer of the property must, in accordance with the rules for disposal of Government land, go first to other Government Departments, then to the London Borough of Sutton and to the Greater London Council, both of whom have urgent housing needs and both of whom have expressed an interest in it.
  I end by assuring the hon. Gentleman that the health authorities and my Department share his concern that we
  1038
  must not only ensure an effective geriatric service in this area but also, if this land is no longer required for health purposes, must ensure that it is used for the maximum benefit of his constituents and all concerned.
  Question put and agreed to.
  Adjourned accordingly at three minutes to Eleven o'clock.

EMPLOYMENT
  North Sea Oil and Gas (Divers)
  North Sea Oil and Gas (Divers)
  Trade Union and Labour Relations Act
  Trade Union and Labour Relations Act
  Luton
  Luton
  Mexborough and Wombwell
  Mexborough and Wombwell
  Equal Pay
  Equal Pay
  Cancer Risks
  Cancer Risks
  Health and Safety Commission
  Health and Safety Commission
  Agricultural Workers (Health and Safety)
  Agricultural Workers (Health and Safety)
  Steel Industry (Wales)
  Steel Industry (Wales)
  Social Contract
  Social Contract
  South Shields
  South Shields
  Training (Lancashire)
  Training (Lancashire)
  Disabled Persons
  Disabled Persons
  Industrial Relations Act
  Industrial Relations Act
  Road Haulage
  Road Haulage
  Training (Wales)
  Training (Wales)
PRICES AND CONSUMER PROTECTION
  Potatoes
  Potatoes
SOCIAL SERVICES
  Unemployment Benefit
  Unemployment Benefit
  Herts and Essex Hospital
  Herts and Essex Hospital
  Child Safety (Medical Products)
  Child Safety (Medical Products)
  Christmas Bonus
  Christmas Bonus
  Supplementary Benefit (Over 80s)
  Supplementary Benefit (Over 80s)
  Hospital Waiting Times (Cheshire)
  Hospital Waiting Times (Cheshire)
  Hospitals (Merseyside)
  Hospitals (Merseyside)
  Hospital Lifts (Macclesfield)
  Hospital Lifts (Macclesfield)
  Surgical Beds and Operating Theatres
  Surgical Beds and Operating Theatres
  Hospital Beds
  Hospital Beds
  Invalid Vehicles
  Invalid Vehicles
  Royal United Hospital, Bath
  Royal United Hospital, Bath
  Wheelchairs
  Wheelchairs
  Pharmacists (Durham)
  Pharmacists (Durham)
  Hearing Aids
  Hearing Aids
DEFENCE
  Dundonald Camp, Troon
  Dundonald Camp, Troon
  Northern Ireland
  Northern Ireland
  Ulster Defence Regiment
  Ulster Defence Regiment
  NAAFI (Belize)
  NAAFI (Belize)
SCOTLAND
  Student Grants
  Student Grants
  European Economic Community
  European Economic Community
  School Leaving Age
  School Leaving Age
  Rate Support Grant
  Rate Support Grant
  School Pupils
  School Pupils
  Housing
  Housing
  Economic Affairs
  Economic Affairs
  Schools
  Schools
  Hampden Park
  Hampden Park
  Schools (Ministerial Visits)
  Schools (Ministerial Visits)
  Fishing Vessels (EEC Grants)
  Fishing Vessels (EEC Grants)
  Rating
  Rating
  Haemophilia (Factor VIII Supplies)
  Haemophilia (Factor VIII Supplies)
  Land Compensation Act (Claims)
  Land Compensation Act (Claims)
  Mathematics Teachers
  Mathematics Teachers
  Housing (Ayrshire)
  Housing (Ayrshire)
  Invalid Vehicles
  Invalid Vehicles
  Students' Residence Charges
  Students' Residence Charges
  COMMONWEALTH PRIME MINISTERS (MEETING)
  COMMONWEALTH PRIME MINISTERS (MEETING)
  OFFSHORE OIL INSTALLATIONS (PROTECTION)
  OFFSHORE OIL INSTALLATIONS (PROTECTION)
  SOUTH AFRICA
  SOUTH AFRICA
  Mr. COSGRAVE (MEETING)
  Mr. COSGRAVE (MEETING)
  EUROPEAN ECONOMIC COMMUNITY
  EUROPEAN ECONOMIC COMMUNITY
  CBI AND TUC (TALKS)
  CBI AND TUC (TALKS)
  SCOTLAND
  SCOTLAND
  UNITED NATIONS
  UNITED NATIONS
  SOCIAL CONTRACT
  SOCIAL CONTRACT
  PRIME MINISTER (SPEECH)
  PRIME MINISTER (SPEECH)
  COMMONWEALTH AGRICULTURAL BUREAUX
  COMMONWEALTH AGRICULTURAL BUREAUX
AGRICULTURE, FISHERIES AND FOOD
  Sugar
  Sugar
  Stock Rearing
  Stock Rearing
  Goods and Services
  Goods and Services
  Farm Finance
  Farm Finance
  Price Review
  Price Review
  World Food Conference
  World Food Conference
  Animal Exports
  Animal Exports
  Slaughtering (Calves and Sows)
  Slaughtering (Calves and Sows)
  Loan Interest Rates
  Loan Interest Rates
  Capital Grant Schemes
  Capital Grant Schemes
  Cheese Subsidy (Administration)
  Cheese Subsidy (Administration)
  Pig Swill Suppliers
  Pig Swill Suppliers
  Detached Duty
  Detached Duty
CIVIL SERVICE
  Pensions (Unestablished Service)
  Pensions (Unestablished Service)
  Administrative and Executive Grades (Pay)
  Administrative and Executive Grades (Pay)
  Pakistan Personnel
  Pakistan Personnel
  Defence Department (Scotland)
  Defence Department (Scotland)
EDUCATION AND SCIENCE
  Pupil-Teacher Ratio
  Pupil-Teacher Ratio
  Teachers
  Teachers
ENVIRONMENT
  Local Commissioners (Essex)
  Local Commissioners (Essex)
  Sewerage Charges
  Sewerage Charges
  Bricks
  Bricks
  Planning Appeal (Bromham)
  Planning Appeal (Bromham)
  The "Lump"
  The "Lump"
  Rating (Flats)
  Rating (Flats)
  Local Government Staffs
  Local Government Staffs
  Attleborough Bypass
  Attleborough Bypass
  Severn Bridge
  Severn Bridge
  Local Authority Housing (Mortgage Rates)
  Local Authority Housing (Mortgage Rates)
  Bromsgrove Eastern Bypass
  Bromsgrove Eastern Bypass
  Electric Wiring (Safety)
  Electric Wiring (Safety)
  Construction Industry (Consultative Procedure)
  Construction Industry (Consultative Procedure)
  Local Authorities (Development Powers)
  Local Authorities (Development Powers)
  Rate Support Grant
  Rate Support Grant
FOREIGN AND COMMONWEALTH AFFAIRS
  Reciprocal Health Service Facilities
  Reciprocal Health Service Facilities
  South Africa
  South Africa
HOME DEPARTMENT
  Special Constabulary (Working Party)
  Special Constabulary (Working Party)
  Local Government Elections (Voting Rights)
  Local Government Elections (Voting Rights)
  Guard Dogs
  Guard Dogs
INDUSTRY
  Steel (Imports)
  Steel (Imports)
  Nationalised Industry Boards (Workers' Representatives)
  Nationalised Industry Boards (Workers' Representatives)
NATIONAL FINANCE
  Nationalised Industries (Deficits)
  Nationalised Industries (Deficits)
  Valuers
  Valuers
  Forestry Policy
  Forestry Policy
  Value Added Tax
  Value Added Tax
  Life Assurance (Tax Relief)
  Life Assurance (Tax Relief)
  Subsidies (Public Sector)
  Subsidies (Public Sector)
OVERSEAS DEVELOPMENT
  Honduras
  Honduras
  West Africa (Sahel Region)
  West Africa (Sahel Region)
  QUEEN'S SPEECH (PRINTING AND PUBLISHING)
  QUEEN'S SPEECH (PRINTING AND PUBLISHING)
TRADE
  PVC Leathercloth
  PVC Leathercloth
WALES
  Gwynedd (Ministerial Visits)
  Gwynedd (Ministerial Visits)
  Lung Diseases (Quarrying)
  Lung Diseases (Quarrying)
  Housing
  Housing

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Coventry.
Several Lords—Took the Oath or Affirmed.

PARLIAMENTARY PAPERS: PRINTING DELAYS
LORD ORR-EWING: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government to list those Acts of Parliament which have not yet been printed and to list Government White Papers which were published since Parliament adjourned in July.
THE LORD PRIVY SEAL (LORD SHEPHERD): My Lords, all Acts of Parliament have now been printed. Sixteen House of Commons Papers and 29 Command Papers were published between the adjournment and dissolution of the House. With the leave of the House, I will list the latter in the OFFICIAL REPORT.
Following are the details referred to:
House of Commons Papers
HC252 Scottish Hospital Endowments Research Trust Annual Report and Accounts 1972–73.
HC277 Supply Estimates 1974–75. Supplementary Estimates (Classes II-XVII: Civil).
HCl87 Greenwich Hospital and Travers Fondation Accounts 1972–73.
HC239 Price Commission, The Fresh Food Reference. 2nd Report. The Marketing of Eggs.
HC300 Annual Report of Her Majesty's Inspectors of Explosives for the year ended 31st December, 1973.
HC336 British Film Fund Agency—16th Annual Report and Statement of Accounts for the 52 weeks ended 29th September, 1973.
HC225 Scottish Law Commission—Report on Presumption of Death.
HC340 Post Office Users' Council for Northern Ireland. Report for Accounting year ended 31st March, 1974.
HC341 Post Officer Users' Council for Scotland. Report for Accounting Year ended 31st March, 1974.
HC342 Post Office Users' Council for Wales and Monmouthshire. Report for Accounting Year ended 31st March, 1974.
HC345 The Monopolies and Mergers Commission: Charter Consolidated Investments Limited and Sadia Limited. A Report on the Proposed Merger.
HC278 Parole Board for Scotland. Report for 1973.
HC287 Atomic Energy Authority Act 1954. Accounts 1973–74.
HC288 Civil Aviation Authority. Accounts 1973–74.
HC276 Social Security Provision for Chronically Sick and Disabled People.
HC339 Industry Act 1972. Annual Report for the year ended 31st March, 1974.
Command Papers
Cmnd 5703 Nuclear Installations Inspectorate Report by the Chief Inspector of Nuclear Installations of the Incident in Building B204 at the Windscale Works of British Nuclear Fuels Ltd.
Cmnd 5705 Capital Transfer Tax.
Cmnd 5704 Wealth Tax.
Cmnd 5676 Offences of Drunkenness, 1973 England and Wales.
Cmnd 5706 The Occupational Pension Schemes (Preservation of Benefit) Amendment Regulations 1974 (S.I. 1974 No. 1324).
Cmnd 5710 The Regeneration of British Industry.
Cmnd 5646 The Scottish Land Court. Report as to Proceedings 1973.
Cmnd 5711 Select Committee on Science and Technology. Government Observations on the Third Report. Session 1972–73. Tracked Hovercraft Ltd.
Cmnd 5707 Statistics of Persons Acquiring Citizenship of the United Kingdom and Colonies 1973.
Cmnd 5709 The Law Commission. Report on Injuries to Unborn Children.
Cmnd 5720 Educational Disadvantage and the Educational Needs of Immigrants. Observations on the Report on Education of the Select Committee on Race Relations and Immigration.
Cmnd 5702 Roads in Scotland. Report for 1973.
Cmnd 5714 Statement on the Report of the Defence Lands Committee 1971–3.
Cmnd 5732 Democracy and Devolution Proposals for Scotland and Wales.
Cmnd. 5715 Statement of Change in Immigration Rules for Control on Entry. Commonwealth Citizens.
Cmnd 5716 Statement of Change in Immigrations Rules for Control after Entry. Commonwealth Citizens.
Cmnd 5717 Statement of Change. Immigration Rules for Control on Entry. EEC and other Non-Commonwealth Nationals.
Cmnd 5718 Statement of Change in Immigration Rules for Control after Entry. EEC and other Non-Commonwealth Nationals.
Cmnd 5723 Pay Board, 6th Report. 1 June, 1974–30 June, 1974.
Cmnd 5722 National Freight Corporation The Government's reply to the 2nd Report from the Select Committee on Nationalised Industries.
Cmnd 5672 Judicial Statistics 1973 (Scotland).
Cmnd 5725 National Film Finance Corporation—Annual Report and Statement of Accounts for the year ended March 31, 1974.
Cmnd 5721 Broadcasting. Copy of Supplemental Royal Charter relating to the British Broadcasting Corporation.
Cmnd 5724 Equality for Women.
Cmnd 5726 National Consumers' Agency.
Cmnd 5713 Better Pensions.
Cmnd 5729 Review Body on Armed Forces Pay. Pay of Service Medical and Dental Officers. Supplement to Third Report 1974.
Cmnd 5727 War on Waste. A Policy for Reclamation.
Cmnd 5730 Land.
LORD ORR-EWING: My Lords, is the noble Lord the Leader of the House aware that when we reassembled last week there were still six Acts of Parliament not available in the Printed Paper Office? This morning the Housing Act 1974 was still not available. Would it not have been better, and more orderly administration, if priority had been given to the printing of Acts of Parliament which could affect the citizens of our country and the administration of justice, rather than publishing larger numbers of White Papers which were clearly put out in order to affect votes?
LORD SHEPHERD: My Lords, I will look into the question of the unavailability and availability of those Acts. My understanding was that the Housing Act was printed on October 25. Regarding the latter part of the noble Lord's supplementary question, White Papers have traditionally over many years often been printed by outside contractors, whereas since 1920 Acts of Parliament have been printed by the St. Stephen's Press. If Acts of Parliament had been printed by outside contractors during the industrial
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dispute that we had last July, I fear that the consequences would have been very grave for all the printing throughout the Government service.
LORD DERWENT: My Lords, in view of that answer I do not understand what has happened. According to the noble Lord the Leader of the House a document such as the one I have in my hand, the National Consumers Agency, is printed by outside printers. But this was printed in September by Her Majesty's, Stationery Office. Would it have been more proper for Her Majesty's Stationery Office to print Acts of Parliament rather than this type of document?
LORD SHEPHERD: All Government papers are distributed by Her Majesty's Stationery Office. Where they are printed is a different question. Some two-thirds of the printing material of the Government service is printed by outside contractors.
THE EARL OF LAUDERDALE: My Lords, can the noble Lord tell the House whether the Minutes of Evidence given before Select Committees in this House have now all been printed and are available?—for example, the Minutes of the E.E.C. Scrutiny Committee which sat in advance of last Thursday's debate.
LORD SHEPHERD: My Lords, I suspected that the noble Earl would bowl a fast ball! I do not have that information. My understanding is there are only two Parliamentary Papers still outstanding, two House of Commons Hansards, which I believe are to be printed in the course of the next ten days. In regard to the point which the noble Earl made, I will look at it and write to him.
LORD HANKEY: My Lords, is it not a disgrace that an unconstitutional strike should damage the national interest to the extent that Acts of Parliament cannot be printed for months? Should not the Government have had them printed elsewhere?
LORD SHEPHERD: My Lords, I have already explained the difficulties that were experienced and the steps that were taken about them. The dispute has, I hope, now ended and a settlement reached. I hope that the noble Earl will consider his words in future, in the

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light of what we hope to see as a continuation of the long and happy service that Her Majesty's Stationery Office and the printers have given to the two Houses of Parliament.
LORD HANKEY: My Lords, will the noble Lord ensure that exactly the same thing does not happen next year as happened this year and the year before?
LORD SHEPHERD: My Lords, if I could rest assured that the noble Lord would respond to the approach I have made, then I should be more confident in answering his question.
LORD SLATER: My Lords, is my noble friend aware that if he were to follow up the suggestion in the supplementary question from the noble Lord, Lord Hankey, then the Government would be seeking to heap more coals of fire upon their heads?
LORD SHEPHERD: My Lords, if my noble friend would see the noble Lord, Lord Hankey, and seek to explain to him the facts of commercial and trade union life, I should be most grateful.
LORD ORR-EWING: My Lords, now that this industrial dispute is settled and therefore there is less feeling, would not the noble Lord the Leader of the House consider through the usual channels whether we ought to look at this matter to find out whether we have the best possible method of publishing Acts of Parliament? It may be that we ought to look at it, because it does not seem to be sensible that Acts of Parliament apply of which no legal person and no citizens can obtain copies, although they are all under the behest of Acts. Could we not perhaps administer our affairs in this respect rather better than we do at present?
LORD SHEPHERD: My Lords, I fully appreciate the difficulties that must have been experienced by the fact that Acts came into being but were not immediately available to those who might wish to see them. I am always willing to discuss any matter through the usual channels, but I ought to say at this stage that we are hoping to achieve a settlement and a basis for future negotiations with those concerned which will avoid the difficulties that we experienced in July.

SOUTH AFRICA: JOINT NAVAL EXERCISES
2.48 p.m.
LORD FRASER OF LONSDALE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government to state whether the exercises and manoeuvres undertaken by the Royal Navy in conjunction with the South African Navy have been successful and useful.
LORD WINTERBOTTOM: My Lords, there have been no formal joint exercises or manœuvres with the South African Navy since this Government took Office. I imagine that the noble Lord is referring to the weapon training undertaken by a group of Royal Naval ships after they had called at South Africa in October on their way to deploy East of the Cape. Weapon training is always useful, particularly during a long voyage, in maintaining operational efficiency.
LORD FRASER OF LONSDALE: My Lords, may I ask whether a consensus might not be achieved in Britain to the effect that the first duty of any Government is to safeguard British power, British lives and British routes of communication? Might not we achieve that consensus in place of the unworthy politics which we have been experiencing? When they come to survey this matter, will the Government give primary consideration to that aspect and come to the conclusion that the Cape route is absolutely essential to our life?
LORD WINTER BOTTOM: My Lords, the noble Lord, Lord Fraser of Lonsdale, is overstressing the importance of the Cape route. I am not saying that it is unimportant, but any Government must take into account the many factors that enter into the interest of this nation. Whereas some individuals may weight the defence element as the most important, others may weight the economic element as more important. Her Majesty's Government are striking a balance between these two factors.
LORD FRASER OF LONSDALE: My Lords, how can the noble Lord suggest

279
that any adverse economic effect could be achieved by friendship with South Africa? South Africa is our best customer in the southern seas, apart from being important to us strategically.
LORD WINTERBOTTOM: My Lords, I do not think that it is a question of friendship. It is a question of collaboration and close co-operation in the field of joint operations with our Armed Forces. It is that which is in question.
LORD ORR-EWING: My Lords, has the noble Lord noticed that, while it is said by the Government that this matter affects our relationship and co-operation with South Africa on defence matters and that maritime routes affect our standing with ex-British territories in South Africa, this is not what has happend to the French, who have supplied submarines and a large number of other weapons of war but against whom there has been no criticism whatsoever from the French territories? Does not this suggest that these objections are not in the interests of Britain, but rather that they are perpetrated by those with extreme Left-Wing views?
LORD WINTERBOTTOM: My Lords, the French have no Simonstown Agreement. Also the French are very far from this situation. The French have a somewhat—
LORD FRASER OF LONSDALE: Common sense!
LORD WINTERBOTTOM: I was about to say a somewhat less idealistic view of these problems. We happen to have different problems and a different approach.
LORD GLADWYN: My Lords, may I ask the noble Lord whether before long we shall have the opportunity of discussing the Simonstown Agreement in this House?
LORD WINTERBOTTOM: My Lords, may I draw the noble Lord's attention to the Statement which was made in another place by the Leader of that House in which he said that a preliminary Statement on defence policy would be made towards the end of this month and that there would be an opportunity to debate that Statement? It is within the Defence Review that Her
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Majesty's Government are studying the whole question of the Simonstown Agreement.
BARONESS ELLES: My Lords, in considering the economic advantages in South Africa, will the noble Lord take into account the recent statement by President Kaunda and the Government of Frelimo in Mozambique who have very good economic relations with South Africa?
LORD WINTERBOTTOM: My Lords, I hope that every nation in South Africa has good economic relations with all the other nations in Africa.
LORD BROCKWAY: My Lords, the Question asked was whether the exercises have been successful and useful. In considering that Question, must we not take a wider view as to how far they strengthen apartheid in South Africa; how far they offend Commonwealth countries in Africa, and how far they discredit the moral status of this country?
LORD WINTERBOTTOM: My Lords, my noble friend is right. This is one factor which Her Majesty's Government are taking into account, but it is a factor which we, as a House, can balance towards the end of the month when we discuss the preliminary communications on the White Paper.
LORD FRASER OF LONSDALE: My Lords, with great respect to my noble friend who used to be the Member for Eton and Slough, does he really suggest to the House that we can all go and drink vodka with the Russians next year but that we must not drink gin with the South Africans?
LORD SHEPHERD: My Lords, I am sorry but I must intervene even though my noble friend was very unfairly provoked. Questions should be put to the Minister and not to one noble Lord on the other side of the House.

GUARD DOGS: TRAINING AND SUPERVISION
THE LORD DE CLIFFORD: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will introduce legislation during the present Session to control

281
the use of guard dogs by security firms in order to ensure that proper standards of training, handling and maintenance are employed.
LORD WELLS-PESTELL: My Lords, my right honourable friends the Home Secretary and the Secretary of State for Scotland are considering the preparation of a code of practice for the training and use of guard dogs by security firms. At the present moment they have no plans to introduce legislation on this subject.
THE LORD DE CLIFFORD: My Lords, while thanking the noble Lord for his reply, may I ask whether he is aware that there are many premises and institutions which are being guarded by guard dogs without any handlers? Is he also aware that the mass of accidents which occur from this circumstance is because there is no compulsion for handlers to be used? Is he also aware that small firms have no proper training facilities or knowledge of training, and that their main method of training is to starve the dogs for three or four days to make them angry?
LORD WELLS-PESTELL: My Lords, it is precisely because of what the noble Lord has said—and which, I take it, the Government accept to be the situation—that consideration is being given at the present moment to drawing up some kind of code which the Government hope ultimately can be achieved on a voluntary basis. If the voluntary basis for the supervision and training of guard dogs does not work out, then obviously legislation will have to be considered. However, I should like to assure the noble Lord and your Lordships that both the Home Office and the Scottish Office are at this moment drawing up a possible code of practice, and that the Department of the Environment have recently set up a Working Party to consider all aspects of the law relating to guard dogs, though this will be a long-term matter. I am hoping that we shall be able to deal with what the noble Lord has said in a much shorter period.
BARONESS BACON: My Lords, is my noble friend aware that this problem is not confined to security firms? Is he aware that it appears to be the case that a great many dangerous dogs—in fact, an increasing number—are being used as household pets, and that it is impossible to walk down any street, either in a big
282
town or in a small village, without seeing this type of dog, either unaccompanied or sometimes accompanied only by small children?
LORD WELLS-PESTELL: My Lords, we are not unaware of what the noble Baroness has said; but I was trying to deal with the matter which had been raised by the noble Lord, who specifically referred to guard dogs kept by security firms, and I hope that my reply will give satisfaction to the House as a whole.
THE LORD DE CLIFFORD: My Lords, I thank the noble Lord for his reply; it was very satisfactory. May I just ask him whether he would please ask his right honourable friends to produce this code of practice as quickly as possible?
LORD WELLS-PESTELL: My Lords, the Home Office and the Scottish Office are doing it quickly. The inquiry by the Department of the Environment will take much longer.

EUROPEAN ECONOMIC COMMUNITY: BUSINESS
3.58 p.m.
BARONESS LLEWELYN-DAVIES OF HASTOE: My Lords, with the leave of the House may I say that a Statement was made yesterday in another place about business to be taken in the Council of Ministers of the European Economic Community during November. It has been agreed through the usual channels that it would be helpful to this House if the monthly Statements of Business in the Council of Ministers were available to your Lordships in the OFFICE REPORT, and I will arrange, with the leave of the House, for this to be done. I shall hope to obtain the leave of the House in future months to make similar arrangements. May I also say a word about refreshments. The Peers grill room will be open this evening as usual, and tomorrow dinners will also be available.
The Statement referred to is as follows:
"With your permission, Mr. Speaker, I will make a statement about business to be taken in the Council of Ministers of the European Community during November.
"Written forecasts for September and October were deposited at the beginning of each month in the normal way. The monthly written forecast for November was deposited on 1st November. At present seven meetings of the Council of Ministers are proposed for November. Environment Ministers will meet on

283
the 7th; Foreign Ministers on the 12th and the 13th; Finance Ministers on the 18th; Agriculture Ministers on the 18th and the 19th; Justice Ministers on the 26th; Budget Ministers on the 28th; and Development Ministers on a date yet to be set.
"The Foreign Ministers' Council will discuss the report which they asked the Commission to make in response to the Foreign Secretary's statement of 4th June about the impact of the Community Budget on the United Kingdom. They will also consider the Community's generalised scheme of preferences for 1975, the regime governing commercial relations with State-trading countries in 1975 and relations with Canada. The council will also examine progress in the negotiations for a convention of association under Protocol 22 of the Treaty of Accession, including the arrangements for imports of sugar from certain developing, mainly Commonwealth, countries.
"The Finance Ministers, in addition to their usual monthly discussions of the economic situation in the Community, are expected to give further consideration to the proposed joint Community borrowing scheme and possible financial assistance to Italy. The Budget Council will consider the European Assembly's observations on the Community's draft budget for 1975.
"The agenda for the Agriculture Ministers' meeting is still to be prepared, but the Council is likely to continue consideration of the future Community sugar beet regime, and arrangements for sugar imports under Protocol 22; and to discuss proposals to increase import prices of New Zealand butter and cheese under provisions of Protocol 18 of the Treaty of Accession.
"Development Ministers will discuss future commission proposals for the overall framework of future Community development policy. The Environment Ministers will discuss proposals to implement part of the environment action programme.
"The Council and Conference of EEC Ministers of Justice will take stock of the work on company law, the mutual recognition and enforcement of judgments, the recognition of the status of companies and other legal persons, the assimilation of private international law rules, the strengthening of co-operation in taking legal action following infringement of Community economic law and the liability of E.E.C. officials in respect of criminal law."
BARONESS TWEEDSMUTR OF BELHELVIE: My Lords, I should like to thank the noble Baroness, the Chief Whip, for her Statement and for including this very important and long Statement in the OFFICE REPORT and undertaking to do this in future. However, may I ask her whether it would be possible, through the usual channels and in consultation with another place, to have these Statements made not on Mondays when this House may not be sitting, but at a time when this House is sitting, because yesterday there were no less than
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eight columns of questions put to the Minister concerned and I suspect that many of your Lordships would equally like to put questions. Secondly, may I ask the Chief Whip whether there will be a monthly Statement of Future Business?
BARONESS LLEWELYN-DAVIES OF HASTOE: My Lords, as the noble Baroness knows too well, another place is its own master. We shall make the usual kind of representations and have the usual kind of friendly response, and I shall do my best to do everything that will enable your Lordships' House to have as free and good a discussion as possible.
LORD BYERS: My Lords, can we get something better than the usual friendly response?

CRIMINAL PROCEDURE (SCOTLAND) BILL [H.L.]
THE MINISTER OF STATE, SCOTTISH OFFICE (LORD HUGHES): My Lords, I beg leave to introduce a Bill to consolidate certain enactments relating to criminal procedure in Scotland. I beg to move that this Bill be read a first time.
Moved, That the Bill be now read 1a.—(Lord Hughes.)
On Question, Bill read 1a, and to be printed.

BIOLOGICAL STANDARDS BILL [H.L.]
LORD WELLS-PESTELL: My Lords, I beg leave to introduce a Bill to establish a body corporate having functions relating to the establishment of standards for, the provision of standard preparations of, and the testing of biological substances; to provide for the transfer of certain property, rights, liabilities and obligations from the Medical Research Council to the Secretary of State for Social Services; and for connected purposes. I beg to move that this Bill be read a first time.
Moved, That the Bill be now read 1a.—(Lord Wells-Pestell.)
On Question, Bill read 1a, and to be printed.

COMMITTEE OF SELECTION
3.0 p.m.
THE CHAIRMAN OF COMMITTEES (THE EARL OF LISTOWEL): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the First Report from the Select Committee be agreed to.—(The Earl of Listowel.)
The Report was as follows:
1. That the Committee have met and propose that, if the Commons agree that a Joint Committee on Statutory Instruments be set up for this Session, the following Lords be named of the Joint Committee:—
D. Atholl,
E. Cork and Orrery,
L. Darling of Hillsborough,
L. Fletcher,
L. Molson,
L. Peddie,
L. Stamp.
2. That the Committee have also considered the membership of the following Select Committees of the House for this Session:—
Leave of Absence,
House of Fords Offices,
Procedure of the House,
Special Orders,
Privileges,
Personal Bills,
Standing Orders (Private Bills).
They propose that the following Lords, together with the Chairman of Committees, be named of these Committees:—

LEAVE OF ABSENCE
F. St. Aldwyn,
L. Amulree,
B. Hylton-Foster,
B. Llewelyn-Davies of Hastoe.

HOUSE OF LORDS OFFICES
Lord Chancellor (L. Elwyn-Jones),
Lord Privy Seal (L. Shepherd),
D. Atholl,
M. Cholmondeley,
C. Loudoun,
E. Alexander of Tunis,
E. St. Aldwyn,
E. Selkirk,
V. Hanworth,
V. Hood,
V. Massereene and Ferrard,
L. Davies of Leek,
L. Diamond,
B. Emmet of Amberley,
L. Erskine of Rerrick,
L. Fiske,
B. Gaitskell,
L. Garner,
L. Granville of Eye,
L. Greenwood of Rossendale,
L. Henderson,
B. Hylton-Foster,
L. Jacques,
B. Llewelyn-Davies of Hastoe,
B. Macleod of Borve,
L. Macpherson of Drumochter,
L. Mais,
V. Simon,
L. Aberdare,
L. Amulree,
L. Auckland,
L. Beaumont of Whitley,
L. Beswick,
L. Bethell,
L. Byers,
L. Carrington,
L. Champion,
L. Clifford of Chudleigh,
L. Mowbray and Stourton,
L. Nugent of Guildford,
L. Orr-Ewing,
L. Platt,
L. Popplewell,
B. Robson of Kiddington,
Ly. Ruthven of Freeland,
L. Sainsbury,
L. Sheffield,
L. Teviot,
L. Trefgarne,
L. Tweedsmuir,
L. Wells-Pestell,
B. White,
L. Wilberforce,
L. Windlesham.

PROCEDURE OF THE HOUSE
Lord Chancellor (L. Elwyn-Jones),
Lord Privy Seal (L. Shepherd),
E. St. Aldwyn,
E. Perth,
E. Selkirk,
V. Hood,
L. Aberdare,
L. Airedale,
B. Bacon,
L. Blyton,
L. Byers,
L. Carrington,
L. Champion,
B. Elliot of Harwood,
B. Gaitskell,
L. Gainer,
B. Hylton-Foster,
B. Llewelyn-Davies of Hastoe,
L. Maybray-King,
L. Molson,
L. Morris of Borth-y-Gest,
L. Nugent of Guildford,
L. Pannell,
L. Wade,
L. Windlesham.

SPECIAL ORDERS
E. Cork and Orrery,
E. Cowley,
L. Archibald,
B. Bacon.
L. Beaumont of Whitley,
L. Cawley,
L. Clwyd,
L. Fletcher,
L. Reay,
L. Stamp,
L. Stow Hill,
L Teviot,
L. Wise.

PRIVILEGES
Lord Privy Seal (L. Shepherd),
E. St. Aldwyn,
L. Amulree,
L. Beswick,
L. Brooke of Cumnor,
L. Byers,
L. Carrington,
L. Champion,
L. Henderson,
B. Hylton-Foster,
B. Llewelyn-Davies of Hastoe,
L. Molson,
L. Rea,
L. Shackleton,
L. Windlesham.

PERSONAL BILLS
E. Mansfield,
L. Cross of Chelsea,
L. Henley,
L. Mancroft,
L. Stow Hill,
L. Wilberforce.

STANDING ORDERS (PRIVATE BILLS)
Lord Chancellor (L. Elwyn-Jones),
E. Lauderdale,
L. Airedale,
L. Alport,
B. Bacon,
L. Cawley,
L. Derwent,
L. Terrington.
3. That the Committee have also considered the membership of the panel of Deputy Chairmen of Committees and they propose that the following Lords be named of the panel:—
E. Cathcart,
E. Cork and Orrery,
E. Shannon,
V. Goschen,
V. Hood,
L. Airedale,
L. Alport,
L. Amherst of Hackney,
L. Champion,
L. Derwent,
L. Douglas of Barloch,
L. Grenfell,
L. Henley,
L. Maybray-King,
L. Merthyr,
L. Nugent of Guildford,
L. Popplewell,
L. Royle,
L. St. Helens,
L. Segal,
L. Strang,
B. Wootton of Abinger.
On Question, Motion agreed to.

ADDRESS IN REPLY TO HER MAJESTY'S MOST GRACIOUS SPEECH
3.1 p.m.
Debate resumed on the Motion moved on Tuesday last by Lord Shinwell—namely, That an humble Address be presented to Her Majesty as follows:
"Most Gracious Sovereign—We, Your Majesty's most dutiful and loyal subjects, the Lords Spiritual and Temporal in Parliament assembled beg leave to thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament."
THE LORD CHANCELLOR (LORD ELWYN-JONES): My Lords, to-day the House is to debate the foreign policy and defence aspects of the gracious Speech. I propose to deal mainly with four areas of foreign policy which we consider are fundamental to this country because of the profund impact which developments in them have on our overall efforts as a Government to maintain our prosperity and our security, the twin base of our survival. I refer to the maintenance of the rule of law in international affairs, to the present international economic situation, to our relations with the European Economic Community and to the problem of East-West relations and détente. My noble friend Lord Goronwy-Roberts will deal with certain other issues when he winds up this debate.
First, I should like to emphasise the leading role which this country has played in efforts to maintain and enhance the rule of law in international affairs. I need not stress the significance that must be attached to international law as a means of regulating relations between the nation States of the world, but there is a growing tendency to question the continued relevance in modern conditions of certain long-accepted principles of international law. We accept that there is a need in certain areas of activity to adapt existing rules of international law so as to make them more responsive to the current preoccupations of the international community and to technological development, but perhaps nowhere is this more evident at the present time than in the area of the Law of the Sea. We intend to continue working for a new

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Law of the Sea Convention which will develop existing rules of international law while at the same time preserving the necessary balance between the various interests which have to be reconciled.
We will also play our part in other activities within the framework of the United Nations and other international organisations designed to promote the codification and progressive development of international law and the harmonisation of national legal systems. In this context the record of the United Kingdom in ratifying the international codification conventions drawn up under the auspices of the United Nations is second to none. We have ratified all four of the existing Geneva Conventions on the Law of the Sea, as well as the Vienna Conventions on diplomatic relations, on consular relations and on the law of treaties.
This necessary task of developing international law so as to make it responsive to the needs of an enlarged international community must, however, be matched by parallel efforts to ensure that international law is effectively applied. This country has always given strong support to the work of the International Court of Justice. We have submitted more cases to the court for adjudication than any other State. Two years ago we took our fishery dispute with Iceland to the International Court and earlier this year the court pronounced judgment in our favour, so vindicating the legal stand which Her Majesty's Government took in this difficult matter. The International Court as the principal judicial organ of the United Nations is an essential instrument for maintaining the rule of law in international affairs. Far more use should be made of it and we must continue to work towards a situation in which it will become more and more natural for States to have recourse to a judicial settlement of their legal disputes.
It is impossible to survey the foreign policy field without reference to the international economic situation. Indeed the most serious of the international problems which we face at the moment are economic. The economic map of the world has been transformed over the past year. The ultimate effects of the quintupling of oil prices are still far from certain, but this change is already affecting profoundly the lives of every man, woman
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and child in this country, and indeed throughout the world.
Your Lordships are well aware of the recessed state of the world economy, of the risks of world slump—indeed, a world crash—unless international cooperation in averting it is of the highest order and pursued with a sense of great urgency, and of the acute and pressing problems raised by the re-cycling of the oil producers' financial surpluses. These challenges are made all the more complex by the high levels of inflation throughout the world. Her Majesty's Government have been playing, and will continue to play, an active part in tackling these problems.
First and foremost we must set our own house in order and strengthen our own economy. At the same time we are actively pursuing co-operative international solutions to these essentially international difficulties. We have frequently laid stress on the importance of not allowing international concern for inflation to divert us from the equally grave dangers of recession. These dangers are in many ways the more immediate and the more painful. I mean stagnation, bankruptcy and unemployment. We have also argued that countries in balance of payments surplus have a duty to sustain levels of domestic demand. The deficit countries, including ourselves, must seek to eliminate their underlying deficits, but all must live with their oil deficits for some time to come if world demand is to be sustained and all countries must help the less developed economies to continue to find and to expand overseas markets for their products.
On the question of re-cycling, the Chancellor of the Exchequer has made imaginative new proposals for extended oil facilities within the International Monetary Fund. His ideas are being urgently studied by the IMF staff, but ultimately the problems arising from high oil prices can be solved only with the consent and co-operation of both producers and consumers, and this may take a long time to achieve. We are taking part with the European Community and the energy co-ordinating group, which includes the major industrial countries among its members, in working out plans for a co-ordination of energy policies.
I turn next to the EEC. It is now a little more than seven months since my

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right honourable friend the Foreign and Commonwealth Secretary, by his speech on April 1 to the Council of Ministers, formally set in motion, as we had pledged to the electorate, the process of renegotiation. Since then there has been a general realisation within the Community that some of the goals and timetables set by the Committee itself were quite unrealistic. There have been changes of government in certain member countries which have produced a greater willingness to question some of the old ideas of the Community, to abandon rigid set positions and to approach discussion, even of fundamental principles, in a more constructive and open-minded way. Of course, we do not claim that this Government are responsible for all these changes of attitude, but we have no doubt at all that our firm approach to the Community has contributed in a substantial way to them. I cannot at this stage predict with confidence what the final outcome of our renegotiation will be. I think it is fair to say, however, that the conditions and the prospects for our discussions with the Community are far better now than the doubters predicted at the outset, and have, indeed, become progressively better since we set out on this process of renegotiation.
My Lords, I should like briefly to review the progress which we have made so far in the main areas in which we were dissatisfied with the terms of entry, or where the Community seemed set on a course which we believed to be against British interests. In his Statement of April 1, my right honourable friend referred to the doubts we had about the commitments in the Paris Summit Communiqué of October, 1972, to economic and monetary union, and to the transformation of the whole complex of the relations of member States into a European Union by 1980. I think it is clear that no one in the Community believes either that full economic and monetary union can be achieved by 1980, or that there should be any attempt to achieve parity at the expense of accepting massive unemployment.
So far as the wider concepts of European union are concerned, we have tried to find out exactly what those who subscribe to the idea mean by this concept,
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but we have failed to get a coherent answer. I think the questions we have asked have contributed to an awareness in the Community that this answer has not yet been examined with precision. I think it is also clear that member Governments do not expect the Community to move towards some sort of federation by 1980. It is accepted that the Community must proceed by mutual agreement, and also that it cannot go faster than the will of the peoples in the various member States will allow. That willingness is fundamental.
My Lords, secondly I should like to mention the problem of the Community budget. This is perhaps the most difficult area which we have faced in renegotiation. Under the Treaty of Accession, it was clear that we were likely to be contributing to the Community budget progressively more than our own gross national product could possibly warrant. At the request of my right honourable friend, the Council of Ministers asked for a report from the Commission on this subject, and it has now been communicated to member Governments. We are studying it carefully. It confirms our basic contention that the budget system is likely to result in the United Kingdom paying more than its fair share. There will be intensive and no doubt difficult discussion in the Council when we come to decide how this problem should be dealt with. It is our firm intention to achieve an arrangement which ensures that we are not required to contribute more to the Community budget than is equitable.
My Lords, I should like to mention relations between the United States and the Community. When we came to power in March, there had been a series of differences between the United States and the Community which had given rise to a good deal of acrimonious discussion and a certain amount of distrust on both sides. I am happy to say that the Government have been able to play an active part in improving the relations between the Nine and the United States, and consultation between them is now working well.
Noble Lords will be aware that the Common Agricultural Policy was one of the areas in which we saw considerable difficulties for Britain. We are seeking

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a number of changes and this at the outset looks likely to be one of the most difficult aspects of renegotiation. It may yet prove to be so. But partly as a result of initiatives from other member States which also found themselves in difficulties in the CAP not dissimilar to those which we saw ourselves, the Council of Ministers decided on October 2 to set in motion a comprehensive review of the CAP which should be ready for discussion in the Council in February next year. This will provide an important opportunity for us to achieve our renegotiation objectives and we shall do so vigorously. I think that there is now a general recognition that the CAP needs overhauling.
At the same time, it is right to recognise that there are some aspects of the CAP which have been beneficial to us. There are some areas where, at least for a time, we are getting cheaper food than we otherwise would have had as a result of our membership of the Community. Sugar is a current example. We shall have an opportunity to discuss this in detail in the debate which will take place in two days' time. Our regional policy has given rise to concern in relation to the implications of the Common Market. With regard to that, we are pursuing in Brussels the objectives we set for ourselves in renegotiation; namely, to ensure that within a co-ordinated EEC regime we would be free to pursue national regional policies appropriate to the circumstances of the United Kingdom.
My Lords, I should like to mention the problems of the trade of Commonwealth and developing countries, and aid to them. At the end of July, a meeting with the 45 developing countries from Africa, the Caribbean and the Pacific, 22 of whom are members of the Commonwealth, resulted in considerable progress. Credit for this must go particularly to the efforts of my right honourable friend the Minister for Overseas Development. We shall work to ensure that these negotiations are brought to a successful conclusion before the end of this year. We are also making efforts to widen the access to EEC markets for other Asian and Commonwealth countries by means of improvement in the Community's generalised scheme of preferences.
My Lords, there is then the question of aid. The Community has broken
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away from the attitudes of the past and accepted the principle of aid to countries which are not associated with it. This acceptance in principle is now being translated into action. The Community has already made a beginning by offering 500 million dollars in emergency aid to countries which are most seriously affected by the rise in the price of oil, subject to satisfactory contributions from other industrialised countries and the oil producers. It has already agreed to release 150 million dollars of this. This aid will be of particular aid to India. As in the other fields I have mentioned, there is more work to do before our renegotiation aims are achieved. However, progress is being made.
My Lords, I now want to turn briefly to the role of Parliament in Community matters. It is extremely important that Parliament, including your Lordships' House, should have the opportunity to exercise a proper degree of control in Community matters. The Scrutiny Committee, set up following recommendations of the Maybray-King Committee under the able chairmanship of my noble friend Lord Diamond, examined a considerable list of EEC proposals and has produced recommendations for debates in this House. We shall be having the first such debate in two days' time, following a debate on the Special Report of the Committee on its activities to date.
From what I have said it will be clear that we have already achieved substantial results from our policy of renegotiation. We made it clear in our Manifesto for the recent Election that we should aim to complete renegotiation in time for the British people to be allowed to express an opinion through the ballot box within one year. We aim to complete renegotiation by the spring of 1975. It is still too early to predict exactly what the outcome will be, but I hope that whatever it is we shall all approach this matter not with ideas predetermined by rigid ideological considerations, but on a pragmatic assessment of the relative advantages and disadvantages, both in the medium and in the long term, to this country of membership of the Community.
I should like to mention briefly the Middle East. I am sure that I do not need to re-emphasise to your Lordships the importance which we and the rest of the industrialised world must place on

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developments in this area. We hope to see soon the opening of a new stage in the long drawn out effort to reach a lasting settlement between Israel and the Arab States, although the difficulties are formidable. My noble friend Lord Goronwy-Roberts will be dealing with this subject more fully in his speech, and I do not propose to say more at this stage.
Before I turn briefly to defence issues, I should like to say a few words on the subject of East/West détente for which there does not appear to be an exact English translation. There was a time when the entire foreign policies of the countries of both the Eastern and Western groups were subordinated to the overriding East/West confrontation. This situation is fast changing: against the background of strategic parity between the United States and the Soviet Union we have seen the inception of a genuine East/West dialogue designed to lower barriers in Europe and bring about a more civilised relationship. Moreover, we also face a range of urgent problems elsewhere, the most important of which is the wide divergences between the developed and the poor countries, of which nations in both these categories have come in the last few years to be ever increasingly aware. In the face of this gap we and the countries of Eastern Europe increasingly face similar problems and responsibilities. We can less and less afford the luxury of putting rigid ideologies, whether Communist or anti-Communist, before the economic realities which we see about us.
In these circumstances questions of East/West détente take on an added significance. We in Britain have to ask ourselves in what way we can best contribute to the process. It would be idle to pretend that we can ever hope to exercise the type of influence on the course of events which the super-Powers can bring to bear. But I am sure that there are a number of ways in which we can play a significant role.
The first way is in our bilateral contacts with countries of Eastern Europe. It is the policy of this Government to develop these contacts to the fullest extent which is consistent with our national security. We shall, through
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these contacts, seek gradually to eliminate the distrust and lack of confidence which have hitherto damaged relationships. Secondly, we can play a full role in the two major conferences which are now proceeding in Geneva and in Vienna. The conference on Security and Cooperation in Europe reassembled about six weeks ago in Geneva after the summer break. Our delegation returned to it following a careful review with our allies of the progress which had so far been made at the conference. Together with them we have put forward a number of proposals designed to quicken the pace, but I fear it would be a mistake to be too optimistic about the likely course of developments at this conference.
The talks in Vienna on Mutual and Balanced Force Reductions are dealing with the rather more specific problem of military force levels. There are certain differences of approach between the NATO countries and the Warsaw Pact Alliance which have so far made concrete progress slow. We as a Government shall do all we can to assist in resolving the differences. I want now to say a few words about defence, since our defence and foreign policies are in many respects inseparable. The Government's full adherence to and support for NATO is, and will remain, a pivotal part of our foreign policy: as the Secretary of State for Defence has already made clear, NATO is the linch-pin of our security and will remain the first charge on the resources made available for defence. We must therefore ensure that we continue to play our full part in NATO and make adequate provision to do so. The efforts towards détente which I have just mentioned depend very much on this. For we shall only secure worthwhile concessions from Eastern Europe by negotiating from strength. It is illusory to imagine that they will not exploit any weakness on our part. Furthermore, the United States make an enormous contribution to the strength of Europe, and we recognise that we cannot expect them to continue to do this unless we ourselves are prepared to play our proper part.
At the same time we must recognise that rising personnel costs and the ever-growing complexity of military technology make a given defence programme increasingly expensive to sustain. We must

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ensure that in the period of great economic difficulty that lies ahead our defence budget does not pre-empt too great a share of the limited resources available for more productive use, particularly exports and investments. We must also take care that we do not carry a disproportionate share of the common burden compared with our major European allies, who are also—and it must not be forgotten—our main trading competitors.
Noble Lords are aware of the Review of Defence Expenditure which this Government have been carrying out since they came to power. Our purpose is to retain a modern and effective defence system while bringing its costs, as a proportion of our national resources, more into line with that of our major European allies. To do this we must achieve substantial savings on defence expenditure of several hundred million pounds a year. We shall seek to achieve this without calling into question our own security or that of our allies. We have made good progress with this Review, and, as the Lord President of the Council said in another place on October 31, there will be a Statement on the Defence Review before the end of this month and the White Paper will be published early next year. The timetable will enable Parliament (including your Lordships' House) as well as our allies and partners to have a very full opportunity to express views before final decisions are taken.
My Lords, I have endeavoured to cover this afternoon some of the major issues facing the foreign policy of this country. But before I sit down, and in the light of exchanges which took place at Question Time, I should like to refer briefly to our relations with South Africa. The principles which we have adopted and which will shape our policy towards South Africa have been made abundantly clear. We reject the whole system of apartheid. It is our firm policy to give no help or co-operation to the South African Government which could be used for internal repression or for the enforcement of apartheid. We are determined to do all we can, within the international community, to help bring about an end to discrimination and injustice in South Africa.
The House is aware of our embargo on the sale of arms to South Africa in
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accordance with our national undertakings. We do, of course, continue to have dealings with South Africa; they are part of the economic facts of life. The House is aware that there has been no change in our position on commercial relations with South Africa outside the sphere of military supplies. As my noble friend Lord Winterbottom said earlier this afternoon, the House is aware that the Government are reviewing the naval arrangements arising from the Simons-town Agreement. We shall be looking carefully at the military advantages which might exist and shall have to weigh our security interests against wider British interests, including, of course, our relations with African countries. We shall inform the House when we have reached our conclusions.
Taking into account the way in which the world situation, and in particular the world economic situation, has developed in the last few years, the success of our foreign policy is probably more fundamentally and directly important to the wellbeing of our people than it has been for a long time. We are fully conscious of this, and as a Government we shall make it our business to make a success of that policy. We are confident that we shall do so.
3.30 p.m.
LORD CARRINGTON: My Lords, our debate so far has been overshadowed by the economic situation and our prospects in the future—and very properly so—but it is right that we should spend a day discussing foreign affairs and defence, for there are a number of issues which I know that many of your Lordships will want to raise this afternoon. We are all grateful to the noble and learned Lord on the Woolsack for initiating this debate. As he said, foreign and defence affairs cannot be dissociated from economic affairs. No country can have a strong and independent foreign policy unless it stems from a powerful economic base. However good the speeches, however noble the sentiments, however splendid the tradition, however experienced and wise the statesman, they count for little unless there is economic and military power behind them, and we deceive ourselves if we think otherwise.
It is also a fact, and it is no good pretending otherwise, that in these last

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30 years we have seen a diminution of British influence and power. That is partly, of course, because of the end of the Empire, partly because of the impossibility of a country of our size competing in military or industrial terms with the two, and now three, giants, but partly because of our lack of success in economic affairs and the relative weakening of our financial base. There can be no argument that if we wish to have a powerful voice in the affairs of Europe, and with Europe in the affairs of the world, we must put our economic house in order.
The policy of successive British Governments over these last 30 years has been, while accepting the diminution in the ability of Britain to stand alone, to counteract it by entering into a series of treaties and alliances and groupings which seek to ensure our safety and to maintain our influence. Broadly speaking, with the exception of the Common Market, this has been a bipartisan approach, and it could be that that is one of the reasons why, in recent years, our debates on foreign affairs have been both infrequent and perhaps rather dull. But we have been very lucky that we have had a policy with which most of the people in this country have agreed. Do not let us overlook the fact that even if there may be disagreements about some aspects of our foreign policy, there is still a very broad measure of agreement between the people of this country about what the foreign policy should be.
My noble friend Lady Tweedsmuir, who is to speak at the end of the debate, will speak about Europe. Therefore, I shall not say much, except to state what is perhaps the most important point, and which I believe is the linchpin on which our future foreign policy must depend. I believe, and believe unrepentantly, that it is vital that this country should continue its membership. To contemplate a situation in which the members of the EEC seek to solve the problems of a European economy, of a European monetary policy, of a European foreign policy, of a European defence policy, of European unity, without Britain sharing in those deliberations is for us to opt out of the future of the Western World. Should there be anybody who supposes that there is an alternative in the Commonwealth, let him go and visit Australia, New Zealand,
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Canada, or Africa, and observe what has happened in these last years.
What, then, is the position of the Government? I know that there are some Members who are, and always have been, opposed to our entry into Europe; some are, and always have been, in favour of it. But where do the Government stand? We are told that much depends on the terms which can be renegotiated, and we are grateful to the noble and learned Lord for giving us such an encouraging account. If terms can be negotiated and obtained which are better than, the ones which would have been accepted by the Prime Minister in 1969, and were accepted by the Conservative Government, very good—I am all for it. But will the Government then advise the British people in the referendum which they are proposing to accept those terms and to remain in the Common Market, or will some of them advise the people of Britain to accept and others to refuse? Or will they not make any recommendation at all to the British people, in spite of the fact that they have successfully renegotiated satisfactory terms? What questions are to be put to the people? How can it be binding upon Members of Parliament? We must be told a good deal more in these next few weeks about what the Government propose, and I am afraid that we must all of us realise that our friends in Europe are getting pretty fed up with us, and that quite a number of them now do not really mind whether we stay or not, because we are being an uncertain nuisance.
What should be the purpose of British foreign policy? It should be to promote British interests, to ensure British security, to further the welfare of the British people, and since peace and prosperity among all nations are essential ingredients of our own security and welfare, we should work assiduously to ensure stability in the world and advancement in developing countries; and of course we should seek to promote justice. But I do not believe that it is the business of British foreign policy to moralise or to preach. Of course there are régimes and governments around the world of which we disapprove; of course we would wish it otherwise. We believe, rightly or wrongly, that we have found a system which, taking it all in all, is fair to the people who live in this country. But perhaps sometimes

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it is right for us to remember that to others our system does not necessarily seem to be the best, or perhaps as they look at some of the events in this country of the past few years they can question the direction in which we are going.
To give one example, there is the feeling which seems to be growing that one need obey only those laws of which one approves—Clay Cross and the Industrial Relations Act are two examples. It could be that in different countries at different stages of political development, different constitutions and different practices are inevitable. We do not publicly have to disapprove or approve. The way to influence people is by example and by contact, and not by disapproval shown by withdrawing diplomatic relations, or boycotting social functions, or banning trade. After all, what have we all been doing in these last three years or so in the European Security Conference? We have been seeking to increase the free movement of people between East and West, so that the exchange of ideas, the examples, as we see it, of our Parliamentary democracy, can have their firsthand effect. What is desirable between East and West is surely as desirable between other countries.
When politicians seek to preach at other countries they are almost invariably selective: they are almost always influenced by their own political beliefs. South Africa is not the only country that practices racial discrimination. There is one glaring example of racial discrimination in a black African country; Chile is not the only country in which the military have seized power. Would it not be as well perhaps sometimes to look at what is happening in, for example, Portugal? I was very glad to see the other day that the Foreign Secretary said:
"If we require a certificate of social democratic respectibility before we buy or sell, we shall find our market-place becoming rather small."
Trade is not a badge of approval, not is security, and I shall come to that in a moment, but I absolutely agree with what the Foreign Secretary has said. If we decide that we are going to trade or to speak or to have contacts with only those régimes of which we approve, because they are parliamentary democracies like ourselves, we are going to find ourselves very short of partners and very
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short of dinner companions for what will be a very frugal dinner.
I must say that I think it is humbug to say that you will trade with South Africa—it is acceptable because it is in our interests to do so and does not mean approval—but that it is not acceptable to collaborate on defence in the interests of British and Western security. If the Government can stand up—and perhaps they can—and say that there is no need for any defence facilities at Simonstown now or in the future, that the route around the Cape by which so much of our shipping goes and will go regardless of whether or not the Suez Canal is opened, is no longer at risk or of importance; if they can say that in any situation which they can foresee collaboration between the Western Navies and the South African Navy is irrelevant, then there is a case for letting the Simonstown agreement lapse, but otherwise there is not. The suspicion must rest until it is dispelled by the Government that any abandonment of our agreement with South Africa is not much concerned with the defence interests of this country.
My Lords, the area of the world that is most vital and most unstable at this time is the Middle East—and here, again, I agree very much with what the Foreign Secretary said at the United Nations the other day. He said:
"There are problems and circumstances when it is much better to leave things alone, when time sorts out the difficulties, and problems which seem insoluble somehow or other seem to get solved. One example was Trieste."
But I do not believe this to be true in the Middle East at the present time, nor could the outcome of the Arab Summit at Rabat last week be said to lead to that conclusion. We have seen over the last two or three years a very considerable shift in the balance of power in the Middle East. For the first time, the Arab countries have sunk their differences and they are cohesive and united. That, and the phenomenal increase in their wealth, has altered the balance in a way which must be as obvious to the Israelis as it is to the outside observer.
The consequences of this unity are there for all of us to see. I do not think that the price of oil would have risen so sharply if it had not been a weapon in the war against Israel. We have not yet begun to understand or to cope with the

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results which that will bring, but with the power and money which unity brings there has been a parallel development. Arab leaders, I think for the first time, are enabled by that new-found strength to find and accept a solution to the Middle East problem—a solution which I think might be acceptable.
The problems between Israel and Egypt are, I think, capable of solution, as indeed they are between Israel and Syria and Jordan, but I do not think that is enough. There can be no solution that will endure, unless we recognise that the problems of the Palestinians also have to be solved. Nobody can pretend that that will not be more difficult. It will be more difficult, but solved they have got to be and there is not much time. I am sure that Dr. Kissinger understands that, and let us hope that in his travels, aided, I hope, by the outspoken and open support of Her Majesty's Government, he will persuade the principals of the need for and the good sense of a settlement—but of a settlement which, if it is just to the Arabs, guarantees the independence of Israel.
The other area of disquiet is obviously that of defence, on which the noble and learned Lord touched. In electing the present Government, the British people have secured a Government which intend to reduce the defence budget by several hundreds of millions of pounds annually. We have not been told how this is to be done; we have not been told why it is to be done or whether it is safe to do it. We must now await the interim Statement in November and the final proposals. I understand, at some time next year. I hope it is not too late, therefore, to put before the Government one or two considerations which they might possibly take into account.
My Lords, the consequences of defence cuts fall into two categories—international and national—and if I am right one of the arguments that the Government used (and which indeed the noble and learned Lord used) to maintain their decision to cut defence expenditure is that we are spending on defence a greater proportion of our gross national product than do other countries. That is perfectly true, or at least it is true of most of the other countries of our own size, but of course we are not spending in total as much money as either the Germans or the French.
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Indeed, the defence percentage of our GNP has been declining, while that of Germany, for instance, has been rising. It is, broadly speaking, the failure of successive Governments to expand the economy which has made it appear that our effort is disproportionate to that of our friends. Under Treaty obligations it is necessary for the Government, before they decide on how far they will reduce their commitments, to consult their allies. I would ask the noble Lord—and I trust the noble Lord received my notice of this question—whether there will be real consultation or whether decisions will in effect have been taken? I would also ask whether we in this House and in the House of Commons will know of the proposals which are being discussed with our allies or whether we will not be told about them until after the discussions are over?
The Government must be aware of two factors: first, that the United States, which spends more of its GNP on defence (and in money terms goodness knows how much more), is becoming increasingly restive about the scale of European effort. There is a widespread feeling in the United States, a feeling which is very powerful in Congress, that a Europe which in 1949 was incapable of much military effort should in its prosperity of 1974 be able to contribute a good deal more to the common alliance than so far it has thought fit. That feeling is growing and we are approaching a position where no American Administration will find it possible to maintain current American involvement without the greatest difficulty. Should that happen the consequences to the Alliance could be very grave, because the American nuclear umbrella, which to an extent is made credible by the presence of large numbers of American troops in Europe, is the cement which binds the Alliance together. Until now the Americans have not only acknowledged that we have contributed our share but have relied upon us to help in persuading others to do more.
My Lords, no democratic Government at this time or most other times find it easy to spend money on weapons of defence. There are so many more appealing and vote-winning matters on which to spend money. Perhaps there is some feeling in this country of that kind, but it is a good deal stronger across

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the Channel. We have already seen the Danes and the Dutch reducing their Forces. No doubt there are other countries who, in economic difficulties, will justify on economic grounds to seek to reduce their contributions. I believe that a sizeable reduction at this time by Britain, a country which has always led the way in its military contribution to the Alliance, will accelerate the trends which we see in Europe and will make the position of the American Administration, in their public wish to maintain the level of their Forces, that much more difficult.
The words of the noble and learned Lord the Lord Chancellor were all right; it is the Government's intentions that I am worried about. There is no need, in this House at any rate, to point out the comparative strengths of the NATO Alliance and the Warsaw Pact; they are well known. The conventional superiority of the Warsaw Pact is large and is increasing. The amount of money which the Communist bloc spends on defence is much greater than that of the West. The strategic nuclear superiority of the Americans is a good deal less than it was a few years ago.
My Lords, I do not for one moment say that this means that the Russians or the Warsaw Pact countries intend to go to war. But what I do say is that until there is some evidence of a decline in Soviet bloc expenditure on defence, until there is some real evidence of détente, it would be very unwise for the West unilaterally to disarm or to suppose that there could be no circumstances in which present Soviet foreign policy could change. A Western Europe in which NATO has disintegrated and which was virtually defenceless would be in no position to defend, itself against the political offensive, backed by overwhelming superiority of military power. The Government have a duty to see that this does not happen. They have a responsibility to make sure that by their actions they do not make the problems of NATO more difficult and so increase its weakness.
The second level on which defence cuts have an effect is national. Obviously they must have an effect upon the morale, the re-engagement and recruitment of men and women into the Services. But, if it is the Government's intention to save several hundred million pounds annually, then inevitably the reductions will be very
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severe. Let nobody suppose that they can stop at Singapore or Malta. In terms of what has to be saved, the money spent in those places is trivial. Nor should I have thought at this time it was a wise proposition to withdraw from Cyprus.
Money saving on the scale envisaged by the Government can be achieved only by the elimination of certain capabilities and by reductions in the research development and production of equipment. I do not know whether Mr. Chapman Pincher is right in his forecast of what the Government intend. All I know is that Mr. Chapman Pincher is seldom wrong. In the many years that I have spent in Defence Departments, he has had an uncanny and sometimes inconvenient facility for hitting the nail on the head. If Mr. Chapman Pincher is right, then the Government are contemplating cuts of a very drastic kind which would affect NATO and our capability to fulfil our commitments in Ireland.
Is it really possible that the Government are contemplating abolishing the Royal Marines, the Parachute Regiment, the Royal Air Force Regiment, the Amphibious Warfare Squadron and many ships of the Royal Navy? My Lords, I do not know. But these are questions which are giving rise to a very great deal of anxiety. I do not believe that uncertainty for another six months will help anybody. But, whether or not they are contemplating these cuts, undoubtedly they will have to reduce both the quantity and quality of new equipment for the Services and the research and development on new equipment. What will be the result of that? Our Services will be less well-equipped than they would otherwise be; in many cases they will be less well-equipped than those alongside whom they would be fighting and those against whom they would have to fight.
At a time of rising unemployment and uncertainty in industry, those firms on defence work will find their orders curtailed. Firms already in difficulties because of the Government's policy will be in even more difficulty. Unemployment will rise; exports will inevitably fall—the export of arms is very large—because it is an indisputable fact that no country will order equipment from another country unless that equipment is in service.

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The British aircraft industry is to be nationalised. Dependent to a large extent on military orders for its survival, it will be in deeper trouble. The cost of individual items will rise. For example, if the Government cut the total orders for the MRCA, inevitably this will affect the price of the aircraft, collaboration with the Germans and employment in British aircraft factories. All these factors must be taken into account. All are important. But the overriding question is whether the Government can cut our defence by such a large figure without affecting our security.
I am not so naive as to suppose that the ordinary man in the street, at a time when international tension is not very high, when he is burdened by high taxation, rising unemployment, inflation and all the rest of it, is likely to be unduly concerned about cuts in defence expenditure. But he should be. Those of us who have lived through the consequences of the mistakes of our predecessors in the 'thirties, and have enjoyed peace in the post-war years because we were prepared to maintain our defences, have a duty and an obligation to point that out and to say with the utmost emphasis to the present Administration, that, if they allow the security of this country to be put at risk because as a Party they are not prepared to reduce expenditure in other fields, then they will be guilty of the gravest possible neglect of their national duty. This is how we who sit on the Opposition Benches will judge them. I hope they will not be found wanting.
3.57 p.m.
LORD GLADWYN: My Lords, I must begin by apologising for the fact that I may not be able to be here till the end of the debate. I have an official dinner at which I must, if possible, be present. But I should hope to get away from it in time to hear the noble Lord, Lord Goronwy-Roberts, wind up.
In our bones we all know that a great crisis is impending, which may even tear this nation apart. In the face of it, the social and economic programme of the Government may become, I fear, a little irrelevant as time goes on. So it is more important than ever, I suggest, to agree, if we can, on our role in the world, about which the Foreign Secretary had a good
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deal to say in his, in many ways, excellent speech in another place last Wednesday. Not so long ago, for instance, we had the three overlapping circles of Sir Winston Churchill. That was a conception. But what is our guiding philosophy now?
Well, my Lords, there is the old idea that with the disappearance of the "pomps of yesterday", Britain might still have a great role as a leader of the Commonwealth. I do not propose to add much more under that heading to what the noble Lord, Lord Carrington, said. It is obvious that the Commonwealth idea can no longer represent a coherent political basis for any valid foreign and defence policy for the United Kingdom. What the Commonwealth countries want, and what for the most part they now have, is a good association, not so much with us as with the European Community.
Then there is the school of thought which can best be described as "Gaullist anti-Market"; pride in our past achievements, complete national independence, a free hand in foreign policy to do anything you like, irrespective of what our allies may feel—a certain xenophobia perhaps, more especially Americano-phobia, if one can call it that; an effort to solve our social difficulties by a frank appeal to patriotism; great concentration on national armaments; the Constitution maintained, but Parliament playing a secondary role; no truck with regionalism, of course. There are certainly people who might find this policy attractive, even though, as we know, it was abandoned as counter-productive in the country where it was first tried out, originally with some success.
But there is a very different kind of nationalism, much favoured by many anti-Marketeers. This consists in believing that borrowing on account of North Sea oil will see us through our economic difficulties and that we can still, by ourselves, become a rather introspective, if you like, but anyhow quite independent. Welfare State on the model, it is so often suggested, of Sweden. Basically materialistic in outlook and increasingly egalitarian, we should concentrate chiefly on our standard of living, not influenced much by foreigners, and indeed rather provincial, content to let our Armed Forces run down somewhat and thus to

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become, as it were, a rather secondary member of the Western Alliance, but still, of course, basking under the protection of the American nuclear umbrella. To those of this school of thought, as I think the noble Lord, Lord Carrington, implied, moral issues are all important, and it is thought that by vigorously asserting them we can best maintain a leading position in the world. But some moral issues are more important than others. The policies of the South African Government, for instance, are believed to be much more outrageous than those of the Soviet Government or of General Amin.
My Lords, there is a tougher, even if often an unavowed, approach by others who, though not numerous, probably know what they are about. This is the achievement of a fully directed economy in which the role of Parliament will be virtually suppressed and the bureaucrats take over under a small élite or junta, whether of the Right or of the Left. In the latter case Britain would become largely disarmed and neutral, looking towards Moscow; and in the former something more like Greece before the last revolution. Naturally, neither the one régime nor the other could persist in the absence of a secret police.
Under the impact of the approaching great or "world" crisis, all these solutions may no doubt be favoured by some, and we may even add to all of them increasing separatist tendencies in Scotland and Wales and, I suppose, also in Northern Ireland. But it is evident to some of us, at any rate, that all of them would be dangerous, if not disastrous. No doubt, my Lords, there is no political philosophy that can be absolutely guaranteed both to preserve our ancient freedoms and to unite the nation, still less ensure a high standard of living in the troublous times which lie ahead of us. We are, admittedly—and nobody would dispute this—to a large extent at the mercy of events, and it is quite conceivable that there may be rather terrible internal convulsions before the one political idea or the other prevails. So is it possible to discover and agree upon some other and more civilised way out?
We Liberals, my Lords, join with the noble Lord, Lord George-Brown, in suggesting that it is in the European idea that the Government, if they are prepared
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to stand up to the emotions of some of their supporters, will find, as it were, the red thread of Ariadne to lead us out of the maze—and even though your Lordships may think that I am once again exhibiting my King Charles's head, I should like to give your Lordships the reasons for so thinking.
If and when the storm really breaks, the instinct of all our free industrialised societies will be to run for cover, and this, of course, will only make the general situation worse. But the larger the area the less likely it will be to suffer intolerable damage. For instance, the United States will perhaps be able to weather the storm with a minimum of real sacrifices. But if the European Community breaks up (and it is quite useless to think that in those circumstances it could possibly be replaced by some kind of free trade area) and each small or medium State of Western Europe has to stand on its own, the advantages of a common policy in a large area will be absent and the prospects of semi-communist regimes in all the then isolated countries of the Community will be very real. I do not say there would be communism at once, but these tendencies could and probably would start in the weakest members of the Community, and would gradually spread out to the not so strong European economies.
Perceiving this danger, the Germans, whatever the present irritations of Herr Schmidt, not relishing being the only buttress of a free or mixed economic system in alliance with an America perhaps no longer willing to commit a very large force to the defence of Europe, will probably do everything they can to keep the Community together, even if it goes so far as to mean a pooling of all monetary reserves. All they will probably ask in return is that the other members should accept, with them, certain elementary disciplines and, in effect, agree to form a real entity and, at long last, in most spheres to speak with one voice.
Already, my Lords, there are signs that the Germans are in practice moving in this direction. The loan to Italy; the sugar deal, which they approved; the beginning of petro-dollar recycling are all instances in point. But even more significant, the French Government: seem to be moving in this direction, too. The French

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President, as we all know, has summoned a summit conference at the end of this month, and wants, apparently, to discuss institutions. Though of course the Government will say that they cannot discuss hypothetical procedures in the absence of any agreement on renegotiation, I suggest that the Government would pour cold water on this proposal at our peril. The French may be out on a limb on energy at the moment, but they are right in maintaining that the Europeans are in a different and a more dangerous situation than the Americans in respect of oil, and that the Europeans ought therefore to have a policy of their own which need not necessarily conflict with that of America. If the French have thoughts on how best we can arrive at common policies by improving our present deplorable procedures, we ought at least to take them into serious consideration.
Anyway, my Lords, it is no good saying that the Community exists only for the purpose of discussing common problems—inflation, unemployment or whatever, however pressing and important these may be. The Government should realise, as they undoubtedly will realise when they finally conclude that it is in our interests to stay in it, that the Community is not the same sort of animal as the OECD or the ILO or NATO, or even the United Nations, invaluable, of course, though all these organisations are. Its purpose is political. Its main object is to preserve our free and open societies and our mixed economies. It is either a potential democratic union or it is nothing.
Let me here quote just one sentence from the recent remarkable and, on the whole, encouraging statement of the President of France. After declaring, quite rightly, that on large issues France must still preserve her sovereignty, he proceeded to criticise the recent use made of the famous "Luxembourg Compromise", recognition of which, as your Lordships will know, M. Pompidou demanded and Mr. Heath accepted as a condition of our entry into the Community. M. Valéry Giscard d'Estaing then observed that an effort should be made to delimit spheres in respect of which, consequently, what he described as a more supple and rapid decision-
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making procedure should apply. I quote his words:
"In this event there would in some respects be a transfer of sovereignty, beginning with small matters and not with great ones."
It seems that the President at least does not regard the Community as the equivalent of, for instance, the OECD, and this is borne out by his final word on the matter—and again I quote:
"An organisation with a confederal structure of the type France favours is clearly an organisation embodying a certain number of restrictions "
in the French the word is limitations—
"and we must get used to this idea".
My Lords, if Her Majesty's Government want to make a success of their renegotiation—and it is obvious that our partners are now bending over backwards to help them to do this—they will have to get used to this idea too. And I add, while I am on this point—and I think that this is again something which the noble Lord, Lord Carrington, said—that, if the Government want our partners to agree to any change in the terms of our membership, they will have to undertake to support the resulting agreement in Parliament and in the country.
It is not a question of committing ourselves to a federation in the old-fashioned sense. A few days ago, I was personally responsible for taking out all reference to a "Chamber of States" in a resolution of the European Parliament defining the bare essentials of the political union projected by the Ministers for 1980. This now stands as a decision-making centre (which they assume will eventually become some kind of Government), a directly-elected Parliament consisting of at least one chamber, a court and an economic and social council. Your Lordships will see that this formula does not exclude a second chamber of some kind if that were thought to be a good thing, but a Chamber of States would evidently be something like the United States Senate, in which case, by 1980, the United Kingdom would be no more than the equivalent of Massachusetts. I myself do not believe that this would be likely by that date, even if it were desirable. Not that it probably matters all that much at the present time, because evidently all stages towards a union will have necessarily to be approved by all the Parliaments including that of Westminster.

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Be that as it may, the allegedly appalling disadvantages of market membership, with which the anti-Europeans made such passionate play in 1972, have simply disappeared. Half our trade—and soon the proportion will be higher—is with the European Community and the adverse trading balance with the Community, which is largely our own fault, is now, as the noble Lord, Lord Shepherd, said last week, in process of being rectified. No hardship has been inflicted on Commonwealth producers of sugar, cheese or butter, all of which they can now sell in the world market at much higher prices than we could pay, and we are not forced to pay higher prices for food produced by allegedly inefficient European peasants; on the contrary, if we were outside the Community we should now be paying much more for the greater part of our imported food. Also, though we can now ask—apparently with some support from the Commission, to say nothing, if the papers this morning are correct, of the Germans—for a reduction in our net contribution to the Community's budget over the year, it is arguable that up to now we have actually been taking more money out of the Community than we have put into it. Our present, admittedly severe, agricultural difficulties are only partially the result of our Market membership. They are just teething troubles which will eventually be put right.
Anyway, a few millions this way or that are chicken-feed compared with the thousands of millions of our overall trading deficit, taking oil into consideration; and they are certainly chicken-feed compared with the vast sums we should stand to lose if we left the Community. In other words—and this is the point I really want to make—the Government must soon take their noses out of the petty cash book and concentrate on the great political issues of the day. Nor should our people, for their part, allow themselves any longer to be fooled by the emotional nonsense talked by the anti-marketeers. Happily, according to the latest poll appearing in this morning's papers, nearly 60 per cent. of people now want in principle to stay in the Community. That is something.
My Lords, there is one other, perhaps all-important problem to which I should like to refer before I sit down: it is the rôle played in the defence of Europe by
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the States forming the Community. This is looming larger and larger on the horizon. I do not know if it will come up at the forthcoming summit in Paris, though it certainly should, but it is likely to be discussed next month in the European Parliament on the basis of a resolution which I have been endeavouring for rather a long time to push through the Political Committee. My personal contention is, and has been for a long time, that, given the growing disparity referred to by the noble Lord, Lord Carrington, between the forces of the West and East now deployed in Central Europe, and given the strong possibility that the withdrawal of at any rate some United States troops will take place soon, the Americans maintaining, and rightly so, that, if the disparity is not to become overwhelming, the Europeans must somehow fill the gap, a unified European defensive system must be established within the general framework of the Atlantic Alliance without further delay. I have also maintained that, if this system depended chiefly on standardised modern conventional weapons, it could be set up with fewer men and, in the long run, at lower cost, if only as a result of the fact that research and development would be pooled and contracts for arms production awarded on cost effectiveness rather than on nationality. Simply slashing our defence budget by some hundreds of millions without even attempting to advance in this direction, would merely represent an attempt to appease the Left-Wing of the Labour Party at the expense of our national security.
There is no blinking the fact, either that nuclear weapons would also be needed in any such scheme as a deterrent, though they would be on a very small scale compared with those of the super Powers. Of course they would never be used except (notionally) on a second strike. The whole point will be to erect a defensive system not easily penetrable by the Russians except by the use of nuclear weapons which even they would, in practice, and given the comeback, be unable profitably to employ on a first strike. That is the theory and, whatever its validity, few experts would now deny that in a few years' time we may be in a position of great danger, while the Russians will be in a position in which they might be severely tempted to bring political pressure to bear

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on us unless something of this kind is achieved. In a word, the famous détente is and must be a will 'o the wisp if the strategic balance is undermined, whereas lasting peace is still possible with the Soviet Union and the Eastern bloc if it is evident that the Community, like a hedgehog or, better, like a porcupine, cannot be assailed without unfortunate results.
My Lords, I have attempted in the short time available—I hope I have not exceeded my quota—to describe the main issues before us. I just do not believe that we can preserve our independence and way of life by isolationism or nationalism, or by a directed economy, or even by just jogging along in an unreformed NATO. I think we must look more and more, within a continuing North Atlantic Alliance, to our European moat. We must, of course, concert all our actions as Europeans with the Americans, so long as they stay in Europe, and be loyal Allies, even though we might not necessarily be involved with them physically in wars in other parts of the world outside the NATO area, to which in any event we might not be able to contribute very much. We must at the same time do our best to promote general disarmament. We, or rather the Community, must be in the forefront—as, happily, we are now—in an effort to recycle the petrodollars and aid the developing nations to the best of our ability. Certainly it is as a Community that we can best agree on some plan for somehow conveying more food to the starving millions of the world. In sum, if the coming great crisis forces the Community nations together in an effort to form a new society based on new values rather than driving them apart, as the Soviet Union confidently expects, then out of evil good may come. First, however, as I "said at the beginning, this country must at long last find its rôle, and my contention is that there is now only one way of finding it.
4.22 p.m.
THE LORD BISHOP OF COVENTRY: My Lords, quite frequently in the past I have found myself in considerable sympathy with and supporting the policy and programme of Her Majesty's Government; but to-day I find myself in total support of the three major points brought forward so brilliantly by the noble Lord,
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Lord Carrington. First, there was his passionate plea that we should remain as ardent members of the European Community—and I underline the word "ardent" because for far too long we have been quibbling about trying to get better terms of entry and have furthermore created an atmosphere of uncertainty as to whether or not we are going to continue as members of this Community. It seems to me that from every possible point of view—culturally, economically and in matters of Defence—it is of vital importance that we should be accepted as an ardent and wholehearted member of the European Community.
The noble Lord then turned to that other important matter of our removal from the port of Simonstown. Again I found myself in considerable sympathy with him, not least when he used the strong word "hypocrisy"—because it seems to me that it is really very difficult to differentiate between our economic cooperation with a country that stands for apartheid (which I loathe with every part of my body) and on the other hand the removal of our Forces from a port in that country, perhaps because of its support of apartheid. You cannot differentiate between the two: it is either both or neither.
The noble Lord also dealt with the matter of cutting down our Armed Forces; and here, as one who for many years had the privilege of being Anglican Bishop of the three Armed Services, I have no hesitation in maintaining that we can speak with authority from strength, but we cannot speak in the affairs and destinies of men if we are so weak that nobody will listen to what we have to say.
I want to-day to speak on the fourth point raised by the noble and learned Lord on the Woolsack; that is the whole question of our aid to Asian and Commonwealth countries. I should like to speak about one matter in particular; namely, aid in the form of food. I realise that we shall be talking about I this matter to-morrow afternoon, but to-day I should like to approach this vastly important subject from an international aspect because it seems to me that a Government must be judged, among other things, by their attitude to and dealings with the developing countries. One of the matters on which we

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shall be judged is on whether we are prepared, in matters of international food, to support those countries who will be desperately in need of it in a matter of months. I wrote this speech before I read this morning the admirable report in The Times concerning the vastly important international conference in Rome. I am glad that that great newspaper gave it front page coverage. I wish to God other newspapers had followed suit, because this conference, which was proposed thirteen months ago by Dr. Kissinger in a speech at the United Nations, has an enormously important two-fold task. First, it must examine ways of improving the production and distribution of food in the medium and long term; and, secondly, there is the need to respond to the immediate challenge presented by a collapse of world food stocks, a collapse which may well lead to widespread famine in India and Bangladesh between May and July of next year.
Your Lordships may ask why I bring this matter into a debate on international affairs. I do so because I believe the crunch—an international collapse in affairs—may come not through a shortage of oil but through a shortage of food. This crisis is almost upon us and therefore we cannot think about foreign affairs without facing up to the implications of this potential tragedy. T would ask you to look for a moment at the present situation. The appalling fact is that world food stocks are now at their lowest level since the War. For the second time since the War—the first time being in 1972—the world harvest has fallen below the previous year's level. The 1974 harvest is 2 per cent. down on that of 1973, but meanwhile the world's population has increased by 70 million.
Still more disturbing is the fact that in the recent past, when harvests have been disappointing, the United States' grain reserves have been available to help out. For instance, in 1961 the United States had reserves equivalent to world grain consumption for three months. This year these reserves are down to twenty-six days—and that is about the minimum which the United States tries to maintain for its own needs. Already the United States Secretary for Agriculture has warned that the United States will not
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be able this time to supply concessionary food, and it is being proposed that an embargo be placed on the free export of American corn and wheat. In consequence—and this is surely a very worrying and almost frightening fact—once the product of the 1974 harvest is exhausted in or around March of next year there will be no reserves for the Third World to draw upon, and those countries which are hardest hit by the failure of the harvest (India and Bangladesh) will face famine. Indeed, this lack of reserves is not only perilous in the world, where there should be a large world reserve of grain, but it is also perilous in this country. Before the war the prudent British farmer always kept one year's reserve of hay on his farm. This is not so now. To-day we are tending to live from hand to mouth: one bad harvest, and we are all in trouble.
Let us look a little more closely, into this perilous situation. Broadly speaking, the rich countries have produced more than they themselves consume. The poor do not produce enough. In 1968 to 1970, four major grain producers—the United States. Australia, Canada and Argentina—cut their wheat acreage from 120 million to 81 million acres, with a consequent loss of about 90 million tons of wheat. Furthermore, as I have already indicated, the United States continued to cut acreage in 1972. The object of these cuts was partly to reduce grain surpluses and partly to force up prices, but it must be remembered that the United Stales of America held the grain reserves for the world. In 1971/72, the Soviet Union purchased 3.4 metric million tons from the United States, which represented one-third of the United States exports. In 1972/73, the USSR imported a total from the World Bank of 14.9 metric million tons, 10.5 metric million tons of which was from the USA. This removed the World Grain Bank. In other words, the USSR is no longer the Grain Bowl of Europe and we have lost the Grain Bank of the world. Meanwhile, the production of grain in the developing world in the 1960s had been boosted by what has been called the "Green Revolution"—the development of "miracle seeds" with a greatly increased yield and the extended use of fertilisers; but the "revolution" ran out of steam by the end of the 1960s. Bad harvests occurred and the result is that although, in absolute

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terms, food production increased in the 1960s in the poor countries at about the same rate as in the rich, the much more rapid increase in population in the poor parts of the world cancelled out most of the gain. Since then the position has greatly deteriorated.
As a result of the cut in food aid because of dwindling reserves in the United States, poor countries are forced to import more food and export less, thereby losing precious foreign exchange; while the rise in oil prices by the OPEC Group has dramatically increased the cost of fuel used in agriculture and oil-based fertilisers. It is as a result of all this that the United Nations has called for this important international action on the food shortage; hence the World Food Conference in Rome beginning to-day. A lot of people feel, and I think rightly, that when the crunch comes it will not be over fuel but over food. The situation is very serious and could be inflammatory. Increases in prices inevitably hit hardest on the poor, who spend between 70 and 80 per cent. of their income on food.
Where do we in this country come into this picture? The fact is—as I have already stated—that the rich countries still produce more food, as a group, than they can consume. Therefore they make a disproportionate demand on the world's food supplies in relation to their population. Although the rich countries account for only one-quarter of the world's population, they consume two-thirds of the world's meat. While it is important for this country and other wealthy countries to liberalise their aid and trade policies towards the developing world, one cannot avoid the challenge to our own patterns of life and consumption habits, which significantly affect patterns of consumption of the world's food resources.
The time has come, during the next four months, to persuade our own, other Western countries and the USSR to divert food stocks which we would have consumed in our own countries to the poor countries—particularly India and Bangladesh. In view of the scale of operation required, sea transport will need to be used and political decisions will need to be taken within the next two months if shipments are to arrive in India in March
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to April, 1975. Clearly, this is a matter which only the Government can undertake and carry through. But Government action—with its impact on our consumption habits—will need to be backed up by pressure of public opinion. It is desirable that we change our eating habits, making less demand on world grain resources. But this will take time. Nevertheless, in the meantime it is a fact not to be forgotten that our greatest crop in this country is grass, and it is that on which our dairy, beef and sheep all depend for nourishment. It is most unfortunate that at this time, as a result of successive Governments' policies, there is a crisis in the livestock sector which will considerably reduce the supply of red meat and milk products.
The crisis in the meat sector is a marketing one. Farmers cannot get rid of their cattle. Therefore, there is a complete breakdown of fatstock which is causing great hardship to many farmers—not least in my own diocese—and, incidentally, great suffering and indeed starvation for many animals. Some of the farmers, totally dispirited, are not replacing their stock. This means that meat will be rationed by price or, indeed, be unavailable. This in turn means that people unable to afford to buy meat will turn for food to imported vegetable protein and cereals, thus preventing these from being sent to the countries of the Third World. In short, instead of contributing considerably to the world grain larder we shall be consuming its products. Thus the amount of grain which could have been shipped from this country to needy countries will diminish. Therefore, the Government must intervene to ensure a balanced agriculture if it is to take steps to divert some of the arable crops, which would otherwise go to domestic consumption, to the needy countries in the Third World.
It will need political and moral leadership of a very high order, but when a challenge is presented the people of this country will respond. We saw this last year when people were asked to economise on fuel and electricity following the oil embargo—they did. Further back, in 1946, the "victor" nations accepted bread rationing following the appeal by Lord Boyd-Orr to the Food and Agriculture Organisation of the United Nations to share our limited stocks with Europeans—including our defeated enemies—many of

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whom would otherwise have starved. This challenge was also accepted. We are once again being presented with a challenge to Government and public opinion to acknowledge the simple fact that we are members, one of another. What I am saying has already been recognised by the European Common Market. With their eye on the developing nations, they have already issued an edict calling for economy in pigs and poultry, thus providing grain for developing countries.
To summarise, the facts of the world situation are so serious that we must do everything we can to secure adequate help for countries like India and Bangladesh. This is going to make heavy demands on the conscience and fair thinking of this country, but I believe that if the Government make the demand clear enough and present the facts sufficiently cogently, then the people of this country will respond. Provided this is backed up by a balanced agricultural policy, this need not necessarily affect the health of the nation.
In conclusion, my Lords, I would not have you think that we in my diocese are unaware of the very serious economic plight of millions in the developing countries. Indeed, for the past 12 months we have been concentrating on the City of Calcutta as a focus of all the problems in the developing countries. We are forming study groups and looking into the question of sharing resources so that the people of Calcutta and the people of Warwickshire may come to share together through a change in our style of life. We must learn to share one another's burdens and so fulfil the never-to-be-forgotten fact that "we are brothers, one of another".
4.38 p.m.
LORD RITCHIE-CALDER: My Lords, I am extremely grateful to the right reverend Prelate for the speech he has just made, which I hope everyone will follow and read, particularly those in our delegation in Rome. My own address was going to be almost entirely with the same emphasis. The right reverend Prelate has made many of the points that I was going to make so much more forcibly than I could have done. Every day at this moment, apart from catastrophic conditions—or, in this case, the abnormal climatic conditions—that are produced in the world, there is arriving on this planet in the shape of new mouths to feed the
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equivalent of 20 divisions of Martians arriving without their field rations. That figure calls for serious concern about not merely what we are going to do about a collapsing situation, but about a continuing situation. That is what the World Food Conference is about. I am very glad that the Government are sending a powerful delegation led by two Ministers, my right honourable friends Mr. Fred Peart and Mrs. Judith Hart. I, over the years, can endorse their credentials as two people whose concern and compassion has always been actively involved in the problems and the situations to which the right reverend Prelate has referred.
I want to take up a point that he made and recall to your Lordships a situation 28 years ago. I do this without any sense of hesitation, because I think that everything that was happening then is existing now. Twenty-eight years ago John Boyd-Orr—our late revered colleague, Lord Boyd-Orr, of Brechin Mearns—called me to Washington as his special adviser at the Famine Conference which he had summoned. He had summoned it to deal, as exists now, with an imminent collapse. The lives of 70 million people were at risk because of the food shortages following the ravages of war. He was the first Director General of the Food and Agriculture Organisation, and had only just been appointed. He was told by everybody, all the sensible people, that what he was attempting was impossible. Yet 23 nations, the major producer and consumer countries, turned up in Washington. He confronted them with the world cake, with a large chunk missing, and asked them to distribute the rest. The delegates from countries which had shared the common purposes of war, and had been sensitised by its horrors and its hardships, responded. The conference established an International Emergency Food Council to cope with the immediate short-term chaos. This was staffed and financed by the FAO and was given emergency executive powers, which by its constitution the FAO did not have then, to distribute exportable food in accordance with people's needs and to fix prices to prevent rises due to shortages. Countries agreed to apply self-denying ordinances, to ration their demands on global food supplies. Britain, your Lordships may recall, had bread rationing, which it had

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not had in two world wars. The British housewife had the fuss and the bother of snipping bread units, to the vociferous indignation of the Housewives' League.
To me, the sad thing was that the British people were not helped to realise at that time that their sacrifices—perhaps we should call them nuisances rather than hardships—were saving the lives of millions of their fellow beings. Other countries took similar measures. The Danes killed off their breeding pigs to economise on feedingstuffs. And I still remember the consternation of Scotland when we had to cut down barley to the distilleries. Other countries increased their crop acreages. My Lords, there was no famine in 1946 or 1947, and for three years the International Emergency Food Council managed the world distribution of food according to needs. From what we have heard from the right reverend Prelate, your Lordships will realise that the situation is, by orders of magnitude, worse to-day. The population has multiplied. Consumption in the affluent countries has increased, not just in terms of increased population, but in what in present circumstances can only be called luxury foods, which require animal feedingstuffs that could directly provide human food and relieve the pressure on the world situation.
The bitter irony, as the right reverend Prelate has pointed out, is the frustration of the green revolution. The plant breeders have triumphantly produced strains of wheat and rice which can double the yields from existing acreages in Pakistan, India, South-East Asia and elsewhere; but the crops depend on lots of pumped irrigation water, fertilisers, pesticides, and farm implements. But the hungry have become the hostages of oil—oil for the pumps, oil-based fertilisers and oil-based pesticides, oil driven tractors. Even if they could get the supplies, they cannot afford them Moreover, the climatic changes which produced the drought and famine in the Sahel and the failure of the monsoons, and the floods and droughts elsewhere, are not, regrettably, a passing event. They will manifest themselves, predictably, certainly for years to come. We can flirt with, but we cannot effectively manage, the weather. But we shall have to take a global view of effects and manage the
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distribution of world food supplies to moderate the predictably disastrous consequences. I say "predictably": that is to say, we have no excuse for saying that nobody told us. We know.
My Lords, what we urgently need to deal with in the present and the immediate future is the revival of the International Emergency Food Council of 1947, which in fact did, as I have described, take charge of the then situation and indeed managed to reverse what could have been a disaster. But as we knew in 1947 at the World Famine Conference in Washington, this kind of first-aid is not enough. That conference called on Boyd-Orr, as Director General of FAO to produce a long-term food policy which would foresee and forestall such crises. When he took over as Director Genera he had rightly complained that his organisation had not been given the means or the muscle to meet the manifest needs of the world. He said:
"The world is crying out for bread and F.A.O. is going to give them pamphlets."
To reinforce its function following this conference in Washington he proposed a World Food Board. It was a courageous concept which entitled him to the Nobel Peace Prize, which he got.
Because, I repeat, I regard it as totally relevant to the needs of to-day, and because if it had existed the nightmare situation in which the world finds itself would not have arisen, I should like to capsulate what was proposed because these things are so foolishly forgotten. Since FAO had no effective powers to implement a world food policy, he proposed that FAO, the Economic and Social Council and the World Bank do three main things. One was to assist, on request, every country, especially over-populated and under-developed countries, to increase food production as nearly as possible to self-sufficiency—I will come back to that in a minute. The second was to build up buffer stocks of food to equalise the good and bad harvest years. The third was, by this reserve and by other means, to stabilise the price of food at levels fair to the producer buying surpluses after a bumper harvest and selling after a bad harvest. Within the idea of the second point, which is what I call "Joseph's granaries", granaries located through the world, was what was regarded then as an heretical

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concept: that was, using food as capital investment. It was argued that in what we now call cost-benefit terms (I do not think that that term existed 27 years ago) the provision of proper nutrition, which would reinforce working capacity and reduce labour turnover, was as clearly an investment as the cost of steel or concrete in a dam.
I would remind your Lordships that this was not at all original. It had occurred to Seti of Egypt 3,500 years before, when he provided his temple builders with four pounds of bread, two bundles of vegetables and a roast of meat daily, and "a fresh linen garment once a month". FAO was to prepare an agricultural budget predicting the needs for various farm commodities and advise farmers to extend or restrict the acreages of crops to be sown, and so avoid possible shortages and gluts. However, it was also recognised that, like Joseph's seven fat years, there would be natural gluts, a specially good growing season and bumper harvests. These would, as in the price-support schemes practised by several countries, most conspicuously by the United States, be brought off the market for buffer stocks in terms of market stabilisation, famine relief, "investment food "and, in Boyd-Orr's concern for proper nutrition, for "social" feeding—to educate people away from food prejudices, for example, helping rice-eaters to become wheat-eaters—so making the food situation more flexible.
I should emphasise that Boyd-Orr wanted to encourage every kind of research and practice which would make countries and regions produce their own food and not be hostage to the policies of the major producer countries. He wanted, he said, to "take food out of politics and politics out of food" or, as the then Director General of UNRRA said, "take human lives off the ticker tapes". Those proposals were considered at the Copenhagen FAO Conference and generally endorsed to the extent that a preparatory commission was set up to study and structuralise the proposals. To Boyd-Orr's plea that Britain should be strongly and imaginatively represented on that Commission, Prime Minister Attlee replied that he would send his best and his brightest. He sent the Parliamentary Secretary to the Ministry of Works. The Parliamentary Secretary eventually re-
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ported back to the House of Commons in a full debate in which many of your Lordships, then in another place (I noticed some of them were present here earlier on), took part. I hope that our Ministers leading our delegation in Rome have refreshed their memories and reinforced their consciences by reading Hansard of February 6, 1947, volume 432, columns 1986 to 2087, because that Parliamentary Secretary was Mr. Harold Wilson. He opened the debate by saying that the object was to ensure that the shortage of food for the ordinary people of the world would come to an end as full production increased "and not continue for 25 years as it did after the last war".
My Lords, it is 28, not 25, years later and the position is immeasurably worse. He talked of the paradox of hunger in the midst of plenty and quoted the epitaph of a Canadian farmer during the depression:
"Here lies the body of Farmer Pete Who starved through growing too much wheat".
Later I was to quote that in India, and an Indian capped it with:
"Here lies the body of Achariya Who starved 'cos Pete's wheat wasn't here".
I quoted both at the London School of Economics and a student added a third verse:
"Statistics prove one must be shamin' With too much food you can't have famine".
My Lords, you could, you can, we have and we shall have if, somehow, the food supplies of the world cannot be better managed.
My Lords, the preparatory commission was a fiasco, with all due deference to our conspicuous representative upon it. My right honourable friend the Prime Minister has, in his book War on World Poverty,) written:
"For various reasons Lord Boyd-Orr's original proposals were not accepted; the main reason was the sudden reversal of the United States' attitude to international agencies, which was in the same period responsible for the death of UNNRA. The United Kingdom"—
wrote Mr. Wilson in War on World Poverty—
"though anxious to co-operate in international action to stabilise farm prices, to expand food production and to attack the problem of world hunger could not, on the eve of the 1947 dollar crisis, contemplate the subscription of

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hundreds of millions of dollars as her contribution to the International Buffer-Stock Fund".
My Lords, "The saddest words of tongue or pen—It might have been". I said at the time that Boyd-Orr's proposals were "two jumps ahead of history". One jump was taken when the United States, through Public Law 480, used "food as investment". To make available the surpluses of food bought off the markets in the price-support scheme, the United States "sold" to needy countries at world prices, but that was just a bookkeeping process because dollars were not expected in return and the money earned for the food in the recipient countries became, in the currency of that country, available as counterpart funds for United States aid and for United States investment in that country. This was broadened into the World Food programme of the United Nations which similarly disposed of farm surpluses of other countries and treated them again as an investment.
Now, my Lords, I think that the second jump has occurred. History has overtaken Boyd-Orr's World Food Board. Here, conspicuously, is an idea whose time at last has come. If the oil crisis has forced the nations, including the powerful nations which spurned the idea of regulation, to consider producer-consumer boards—a World Oil Board, if you like—then they cannot recoil, as they did so blindly in 1947, from the idea of a regulatory mechanism for food. I do not see the World Food Board as another autonomous body. We are always inventing new bodies, giving them a new name and pretending that they are going to do something which we have ducked doing in some other way. I do not regard it like that at all, but I think that it should be the operational arm of a strengthened Food and Agriculture Organisation (and I emphasise "strengthened", because it has been very much debilitated in recent years) in conjunction, as we thought 28 years ago, with the Economic and Social Council and with the World Bank, with its now enlightened policy of "lifting up the bottom 40 per cent.".
In 1947 I was not too convinced because it was still a hard-hearted banking system, but today it has brought about a complete "un-Macnamara". I am always delighted to hear of Mr. Macnamara
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coming out because a converted sinner always beats the halleluja drum the loudest. However, we have now a real opportunity. I hope that it will emerge in the first instance, as the right reverend Prelate insisted, that we need, as an immediate first stage operation, the International Emergency Food Council to be brought back into existence, and we need to look at the next six months and the next year in terms of an immediate problem. We have to do this and we have to stabilise the whole world situation because we are inescapably all involved now, foodwise and in every other way, in the totality of the world.
My Lords, I shall leave you with John Boyd-Orr's answers to the economists and experts. As a great nutritional research scientist he said:
"All I have learned about calories, proteins, carbohydrates, trace-elements, vitamins and enzymes amounts to this—If people are hungry they need food. If they are ill-nourished they need good food".
5.0 p.m.
LORD BETHELL: My Lords, when three months ago the Turkish Army moved into the Island of Cyprus twice in the space of few days, it was not the first time that a country whose independence and integrity we have guaranteed had been invaded by foreign armies without any strong reaction from ourselves. It happened, as your Lordships may recall, in 1939 in Poland but it was, I think, the first time that a country, part of which is sovereign British territory, was treated in this way without any physical reaction by the United Kingdom. At first during those days of violence the results of the Turkish invasion seemed to be quite good. Greece was restored to democracy and the man of violence, Nikos Sampson, was removed from power in Cyprus. But in the weeks which have followed the horrors of what has been happening on that island have become only too plain, and they have left us after three months with a situation of such human tragedy and danger to the whole world that I should like to devote my whole speech to this problem today.
One of the difficulties in reporting accurately on a country which is occupied by an army in the full flood of victory is that it is difficult to acquire accurate information. The army concerned is seldom willing to let in observers and

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those who are let in are often treated by one side or the other as being biased. But I think there has been enough collected evidence over the past few weeks from the northern part of Cyprus to enable us to state beyond all reasonable doubt that horrible things have been taking place. The sources are not only Greek; we also have information from United Nations personnel and from the International Red Cross. I should like to declare an interest in that I am a member of the Committee of Friends of Cyprus (a Committee under the chairmanship of the noble Lord, Lord Caradon), a group unaligned with Greek or Turk whose aim is to restore the independence and integrity of a unitary State of Cyprus.
During the past few weeks the populations have been effectively separated. Greek is no longer living anywhere near Turk and Turk no longer near Greek, at least so far as the North is concerned. The population of the northern 40 per cent. has been rigidly controlled and by far the greater part have moved South of the line or have been taken by the Turkish Army to Turkey. I am told that of the 200,000 Greeks who lived North of the line before the invasion only about 10 per cent. remain. The rest have either been taken to Turkey in the case of able-bodied men or they have fled for fear of what might happen to them, or they have been physically ejected across the line. There have been numerous reports in British newspapers, particularly in the Sun and the Daily Mail from eye-witnesses—British journalists—describing murders and lootings which have taken place as a result of the moving in of the 40,000 Turkish Forces.
There have been cases of rape which have been well documented, and perhaps the most horrible of the pieces of information which came into our possession reliably in recent days has been the fact that a family planning association from America has sent a woman to the North of Cyprus, as an act of charity, to abort the victims of rape in that area. Unfortunately, her services have been all too often required over the past weeks and she has done her best to help not only Greek women but also Turkish women. Her name is Miss Merrow Goldberg.
I do not want to dwell on horror stories and I am only too willing to admit
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that there probably were certain atrocities committed on the other side as well. I am certainly eager to put the other side of the case and to admit that this terrible situation would never have happened if it had not been for the activities of that man of violence, Nikos Sampson, and his bullyboys who seized power in the coup of July. The (invasion would almost certainly never have taken place if this man had not acted in the way he did. So it is foolish to say that the fault is entirely on the Turkish side and that the Greeks—mainly, of course, the Forces controlled by the former Government of Greece—are in no way to blame. Of course there were faults on both sides. But leaving that aside one has to face the present situation and consider whether these acts of violence which have been taking place have any purpose. Are they merely the excesses of a group of soldiers drunk with victory, indulging in the kind of practices which victorious armies traditionally indulge in, or is there some purpose in what is happening? I must say that it looks all too clear to me that there is some method in the madness.
If one looks at some of the other strange occurrences in the northern 40 per cent. of the island one will see that the Cypriot currency is moving slowly out of circulation and being replaced by the Turkish lira. The post is being sent to the North of Cyprus via Turkey; foreign companies, including British companies, are being invited to register with the Turkish authorities even though they are already registered with the Government of Cyprus. The churches are being turned into mosques; Greek property, after the inhabitants have fled, is being taken over; their effects are either being taken over as well or are being shipped to Turkey and Turks are moving into permanent occupation. Indeed in a Press Conference a few days ago the Turkish Cypriot leader Mr. Rauf Denktash justified the looting of Greek property in the North of the island by saying that it was understandable in view of the sufferings of the Turks in Cyprus during the past 11 years.
The result of all this is that it is almost impossible for a Greek to remain in the North. If he is not in physical danger himself—and it seems that the actual physical assaults are diminishing as a certain crude order is brought into being in

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those areas—he surely must remove himself from an area where it appears that he has very little future. So they are still moving, by the hundred, by the thousand, South of the line into refugee camps as the days become shorter and the evenings become colder, and we can only guess how long they will be in these refugee camps and when, if ever, they will be allowed to return to their homes.
Two days ago a Resolution was passed unanimously by the General Assembly calling for the speedy withdrawal of all foreign Forces from the Republic of Cyprus—all Greek Forces, all Turkish Forces—and for the urgent return of all refugees to their homes. But I wonder whether this will happen? Turkey has welcomed the Resolution, Greece has welcomed it and so has the United Kingdom, but will it in fact happen? How will it be interpreted? Will it be interpreted in the normal, logical way as it seems to us here, or in the way of providing what is becoming known as a bi-regional federal State, a term which I have heard not only from Turkish leaders recently, but also, I am concerned to say, from one or two people not too far away from the Foreign and Commonwealth Office.
My Lords, one of the questions I shall ask the noble Lord, Lord Goronwy-Roberts, to answer is whether this is in fact British policy. Are we going to lend our support to the idea of a bi-regional federal Slate? This is the demand of the Turkish side in toto. If we are going to do this, what will it mean? What are we going to support, and what are we not going to support? If we have a total separation of the communities, which I imagine is what many on the Turkish side would like to see; if we have) a geographical federation with a line, some sort of frontier, with a weak central Government, a partition or, indeed, an enosis (a movement of the North towards union with Turkey) what is going to happen? We know that the north of the island controls and has in it the bulk of the industry of Cyprus. Most of the tourists go to the North. It has perhaps as much as 80 per cent. of the citrus groves. It is the richer part of the island.
What will happen to the Greeks who used to live and profit from this rich area
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of their island (their island and the Turkish island as well) if they are not allowed to return to their homes? Will the South be able to support the half a million Cypriot Greeks by itself, or will they be eased out? This is another of the most worrying factors that has come to my attention recently. Cypriot Greeks are leaving the island because they feel they have no future. They cannot remit currency out of the island. Those from the North are deprived of their livelihoods, as also are many from the South. Many are deciding that they have no future there and that they might as well pull up sticks and move elsewhere, cither to Greece or the United States, countries where they have relatives and where they can try to start life anew. Businesses have been totally disrupted, and farms taken away. What are they to do?
My Lords, were this to happen I would suggest that it would not be a short, sharp, cruel solution to the problem. It would not be a quick slice of the knife dealing with the problem cruelly and effectively. I suggest to your Lordships that rather it would leave a running sore which would last for decades. The history of Greece and Turkey is a very unhappy one, of course, and this is just the latest chapter in it. Unless we can find a solution which will enable both sides to maintain their rights and go back to something like the status quo before July—I am not saying that it was ideal before; there were many bad things then about the situation—we shall have all the ingredients of a dispute on the lines of the Arab-Israeli dispute: the refugees, the hasty partition, the solution imposed from outside, the hundreds of thousands of displaced persons feeling that they have nothing to lose, their bitterness festering as the decades pass.
And so, my Lords, I am going to ask the Minister several questions of which I have given him notice. The first two are concerned with British interests on the island. Can the noble Lord give the House any information about what has happened to British-owned property in the North of the island? What is the situation with regard to the looting of such property? What can the noble Lord tell us about this? Are the owners of such property allowed to return to their homes, to visit their homes and to inspect them? What is the situation about the

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registration of such properties? Have owners of property been invited to reregister with another authority?
With regard to British rights, do our Armed Forces still have a right to circulate over the whole of Cyprus, which was guaranteed to us under the 1960 Agreement? Are we able to move our military vehicles to the places North of the island where we are entitled under the Treaty to go in pursuit of our legitimate military duties under that Treaty? If we are not allowed to do this, what representations have we made to the Turkish Government about this matter, and what answer have we received? I should also like the Minister to give me as much information as he can about what exactly our policy is towards Cyprus. We surely must have some policy. This is not merely a foreign country where we have no rights; this is a country which we have guaranteed, and part of which we own. What exactly is our policy? Do we in fact believe that the resolution of the General Assembly will be carried out? If we are worried about this, would we consider trying to urge the Security Council to ask for a time limit on the implementation of the resolution passed a few days ago? Do the Government see any merit in trying to obtain a time limit for the withdrawal of Greek and Turkish forces, and for the return of refugees to their homes?
My Lords, I also hope that the Minister will be able to state the firm opposition of the Government to any settlement—and I will not quibble over terminology; over terms used like "federation", "communal security", "bi-regionalisation"; these are terms which I am sure will come up when the matter comes to the negotiating table. Can the Minister give an assurance to this House that no solution will be seriously considered by this Government, who are one of the three guarantor Powers, which does not allow those who have been uprooted to return to their homes?
My Lords, I conclude by urging your Lordships, as members of the Parliament of a country which has guaranteed Cyprus integrity, to bring this horrible problem to the attention of other Governments. Particularly I would draw the attention of your Lordships to the forthcoming conference of NATO Parliamentarians in
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the next few days. There will be here many Parliamentarians from foreign countries, including several United States senators and congressmen. It would seem that, in the realities of to-day, it is the United States Administration and the United States Congress which has the weight, the force, to use real influence on events such as this. Unfortunately, this is yet another situation Where we have the responsibility to do certain things, but not the power. But even though we do not have the power, I ask the Government and your Lordships to do all possible to limit the horrors which have taken place and are continuing in Cyprus. I would ask the Government and your Lordships to try to bring that country back to independence.
LORD MILFORD: My Lords, before the noble Lord sits down after so moving a speech, may I ask him whether the Cypriots themselves, and perhaps he, too, considers that the tragedy of Cyprus, and its future tragedy, is because of its strategic position in the Mediterranean? It is a pawn among the super-Powers, very near the Middle East and could be very valuable to NATO.
LORD BETHELL: My Lords, there are no NATO bases on the Island of Cyprus; there are British bases. In my most recent visit to Cyprus and in talks with leaders of the communities in Cyprus, I could not detect that there was any significant opposition to the presence of British bases in Cyprus.
5.22 p.m.
LORD GREENHILL OF HARROW: My Lords, I ask your Lordships' indulgence since this is the first time I have had the privilege of addressing the House. I want to speak briefly on four subjects only; namely, European renegotiation, European defence, the détente, and lastly on Rhodesia.
On renegotiation, I am very sorry indeed that the Government have set themselves a time limit. I believe there is more to be gained by taking things slowly and taking things realistically. I personally have always felt that many of the more extravagant claims and hopes expressed for the EEC will not be fulfilled in measurable time, if ever at all, but it is right that substantial changes should be attempted and a determined effort made to modify the terms to our

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advantage. But, in my opinion, it may take some time before a satisfactory position emerges, and we can afford to wait.
It may be impudent for me to say so, but not one of the leaders of the Governments of the Nine knows, in my opinion, precisely where he is going, because the full extent of the political and economic options open to him are not clear. My impression over recent years is that in spite of all the elaborate diplomatic machinery these leaders do not understand sufficiently each other's positions. The issues have never been properly jointly explored and never will be under the existing machinery.
Can, therefore, we speed things up? Is there any short cut to a better understanding? Here it is my contention that the common interests of the Western Europeans are sufficiently large to justify the leaders meeting monthly, confidentially in British Cabinet style. Only collective discussion at the top level over a period of months, or even years, will establish the understanding and confidence which will lead to the sort of Europe from which we can all benefit and which can be reconciled with strongly held national feelings. Summits à deux are no substitute; they breed suspicion and jealousy and seldom in practice get to the heart of controversial matters. I am, therefore, glad that a full scale summit is proposed for December. We must hope that the experience of it will encourage further and more frequent meetings.
It has been very sensibly suggested that the December summit should discuss matters of direct interest to the man in the street. Inflation and unemployment have been mentioned. But I hope that the Government intend very soon to look with the other Europeans at the problem of European defence—too long neglected and now complicated by our new vulnerability in the North Sea. The language of the Queen's Speech suggests that this is all in hand. I hope very much that it is, but I am bound to say that experience makes me sceptical. There is, I suggest, in France a growing readiness to think more constructively than before on these matters, and we should take advantage of this. In contrast—the noble Lord, Lord Carrington, drew attention to this—the patience of the Americans is certainly not limitless, nor will the American people, possibly under a new President
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and a new Party, necessarily continue to identify their interests so clearly with our own. We have been warned of this by Secretaries of State as diverse as Dean Rusk and Dr. Kissinger.
So far as détente is concerned, I have great confidence that the Foreign Secretary will negotiate effectively with the Russians, although I doubt whether he can count on so long a period of office as his opposite number. There is, of course, universal welcome for the idea of détente. But how far in fact is it real rather than apparent? Détente is in part an attitude of mind and there can be no denying that attitudes have improved on both sides. But if you take the trouble to make a close study of actual agreements reached, you will find a disappointing lack of content. Furthermore, the Russian military build-up remains without adequate and acceptable explanation. I hope that I am not out of order, as a Governor of the BBC, in drawing attention to the documentary on the Soviet Navy which is being shown on television to-night. For it would be very unwise of us to be led by emotion or hope to underestimate the patient determination with which the Soviet Union seeks its consistent objectives. It is still, in my view, prudent for us to be cautious.
Now with regard to Rhodesia. I know that the sanctions renewal is to be discussed soon, but this is a foreign policy problem for which Her Majesty's Government have the prime responsibility. It is a problem which affects our position worldwide, and it is one of the few matters on which we are in a position to take an initiative. It is clear, I think, from what has been said in public, that Her Majesty's Government intend to explore again the possibility of a settlement. This must be welcomed. Further delay will mean not only continued bloodshed but, possibly more importantly, will preclude the economic development of the country in a way to keep pace with the growth of the African population.
I have had some modest experience of this problem myself since the Prime Minister's efforts on HMS "Fearless", which no doubt the noble and learned Lord the Lord Chancellor will recall, and Sir Alec Douglas-Home's negotiations in Salisbury. Little more than a year ago I had confidential discussions in Salisbury with Bishop Muzorewa and Mr. Ian

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Smith. I have never felt that a settlement acceptable to the Rhodesian Africans was beyond reach, and over the last few months events have surely turned this possibility into more of a probability. The Rhodesian Government has got to face unpalatable and inescapable facts. It will not be easy for them to do so, and it is our duty and the duty of the countries of Southern Africa to help them to do so. The Africans in particular, with time so clearly on their side, should not press their advantage to unreasonable lengths. There are encouraging signs that in a comparable situation in the former Portuguese colonies, the African leaders understand this point very well.
I have two suggestions in connection with the negotiations to make to Her Majesty's Government. Neither is new, but I think they bear repetition. The first is that Her Majesty's Government should consider carefully whether there is not some advantage in making the negotiations—at least in the final stages—an all-Party affair. I can see that there may be an understandable reluctance to do so. Nevertheless, for the long-term peace I suggest it is worth very serious consideration. The second point is that there should be included in any British proposals certain financial provisions. These provisions would permit white Rhodesians who find the inevitable majority African rule intolerable, to withdraw in good time and in good order. Nobody can any longer seriously pretend that Rhodesia can be a country for further white settlement. Such financial provisions would make the necessary adjustment of the present populations less painful. In this matter I think our Commonwealth partners can help.
Lastly, my Lords, it is being frequently said that the position of this country in the world is enhanced by the widespread admiration for our institutions and the way in which we manage our affairs. This was certainly true. But I am bound to say that over the last year, and since I have ceased to hold an official appointment—and perhaps because I have ceased to hold an official appointment—I have heard a great deal less of this admiration from foreigners. I am sure, my Lords, that every one of us would like to see this reputation restored and maintained. I believe that in this
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House, in particular, we should work together with this purpose in view.
5.33 p.m.
LORD ARDWICK: My Lords, it gives me great pleasure to follow the noble Lord, Lord Greenhill of Harrow, and to have the privilege of being the first to congratulate him upon a most notable maiden speech. It is almost a presumptuous courtesy to do so, such is the depth and the length of his experience of foreign affairs. This is not the first time that I have had the pleasure of participating in a debate with him. We were once together at that place where they have so many constructive discussions, at Wilton Park. In the future, I think we can say that no foreign affairs debates will be complete without the participation of the noble Lord, Lord Greenhill of Harrow.
I am sure that the noble Lord will forgive me if I do not follow him in his later remarks, but later on in my speech I shall come to the point with which he opened; that is, the question of when Britain ballots about whether it should stay in or withdraw from the Common Market. To-day we are debating primarily, as I have realised, just one aspect of the gracious Speech, but I take it that one is still free to make a few general observations on the situation of this country, and to come around obliquely, as, it were, to the immediate subject that we are discussing this afternoon.
I should like for a moment or two to go back to the General Election, which I followed—for the last time in my life— as a professional observer rather than as a participant. It was a very odd Election, a very serious Election. Each Party, of course, expressed a strong wish to be given a majority, but I did not feel on this occasion, as I have felt on many other occasions, that any Party was desperately hungry for power. I kept asking myself why; what was the cause of this relative modesty. The only answer that I could come up with was that nobody at this time can believe that a patent solution exists at hand, if only the programme and the principles of his Party were applied to the problems that are before the country. Indeed, the Party opposite seemed to be proposing to

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abandon the single Party solution of government, and suggesting that some programme should be worked out that would have the consent of all the major Parties, and perhaps even their active support. My own Party proposed something like an alternative to this, that national unity might be achieved on the basis of our social contract.
This kind of very mature electioneering can make a considerable appeal to the electors, but it does little for the psychological needs of the zealous people who do the Party chores and keep our system going. They live by faith. They are the Old Believers. The old-time religion is good enough for them. And when their leaders cease to tell them that national salvation is to be found in their faith, and in their faith alone, then they have doubts about their leadership. It is conflicts of this kind which are now shaking all the political Parties. What do the Labour Government really intend to do? Even after the proposals in the gracious Speech there are people in the Party who are wondering whether it is drifting away from its Socialist principles. And v/hat alternative do the Conservative Opposition, and indeed the Liberal Opposition, intend to offer? Will they actually challenge Labour? I think the quicker the Parties get over their troubles the better it will be for all of us.
This might be a useful point at which to say how much I suspect the argument advanced not only—and most understandably—by the losers of the Election, but by some of my erudite friends who write political columns in the Press; the argument that since Labour did not win a majority of the votes in the Election, then they have no mandate to carry out their Socialist policies. It seems to me that unless the Liberal Party suffers some terrible setback, unless the national parties fade away—which I do not think they are going to do—then no Government will ever get more than about 40 per cent. of all the votes in the country. Are we to say, then, that we shall never have confident Party government again? Are we right on this occasion to interpret all non-Labour votes as those given by people who are implacable enemies of everything Socialist in the Labour programme? I do not believe it, any more than I believe that every Labour voter
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accepts every bit of our policy and repudiates every bit of the policy advanced by the Parties opposite. People are not like that any more to-day. There is a wide gap between the voter and the man who is an active member of the Party for which he votes. And what are we to make of the 25 per cent. of people who did not vote at all? What was the view of those of them who were well enough to go to the polls? I think one might well argue that they were acquiescent in the continuation of a Labour Government.
Surely the truth of the matter is that no Party in this country can ever win a big enough proportion of the vote to plunge ahead with its programme over the following five years regardless of manifest changes in the national situation, and manifest changes in the views of the people. A Government cannot live on the confidence expressed in them by the electorate on one day of one year. They have to win confidence every day of their life, and they must convince the public that they have their priorities right, and that the items in their Manifesto that they now propose to implement are as relevant at this moment as they appeared to be in the run-up to the Election. Indeed, it is no dishonour when the Government makes a U-turn, as the Party opposite did, provided that the turn is a brave one and is made towards reality, as it was on that occasion when the Conservative Party saw that developing unemployment was totally unacceptable in this day and age—a view which I hope they go on to hold even through these very difficult days.
I think part of the disillusion which is now felt by Party men at Westminster is the inability of the gracious Speech to explore all the policies which are relevant to the immediate situation. We found this difficulty this afternoon. In trying to debate foreign affairs we cannot totally divorce them from home affairs. The gracious Speech could give us in practical detail only one side of the triangle which this Government have to describe, the side which deals with legislation the Government propose to fulfil their side of the social contract. The hope is, of course, that these generous policies, these acts of social justice will evoke not merely an acceptance of moderation in wage demands, but acceptance of the pragmatic and possibly rather harsh policies

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which the Chancellor of the Exchequer may have to pursue if unemployment is to be kept to a minimum, if industry is to be kept in anything like full production, if inflation is to be systematically reduced, and if international confidence is to be preserved in the British economy.
Nobody should imagine that a breakdown in our system, in the world as it is to-day, will lead to a rich Socialist opportunity. We are not living on a self-sufficient economic island; we are not living on a self-sufficient financial island. We have a mixed economy, and the alternative to a thriving capitalist side of our mixed economy is not a thriving Socialism. Alas, it is not that! It is, rather, a crippled capitalism which would impoverish us all and put many of us out of work, and indeed might even threaten our democratic system. My right honourable friend the Chancellor in his Election statement, I recall, recognised the current needs for business of a restoration of liquidity and profitability.
Indeed, coming for a moment to this mixed economy, I find myself able—I seem to be almost unique in this—to welcome both the National Enterprise Board, which my right honourable friend Mr. Benn is to administer, and also the Investment Bank, which is said to be a gleam in the eye of my right honourable friend Mr. Lever. Some people see these schemes as being in conflict, but to me they look complementary. Those who believe that the reclamation of the business side of the economy can be achieved by the NEB alone do not, I think, understand the scope and the urgency of the problem. Mr. Lever's proposal, if I understand it properly, is intended to restore immediate and long-term capital facilities which have disappeared. It is a scheme largely to channel private finance into this market by providing the Government's moral support and some modest reward. There have, of course, been some rather fantastic versions of what the scheme implies.
The Budget next week will describe the second side of the triangle. The third side is the subject we are debating today, the international side. As the Chancellor of the Exchequer has said, the increase in oil prices is at the very heart of the international problem. The terrifying estimate now is that the oil producing countries will have in this one year
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£29,000 million which they simply cannot spend on goods and services from the oil-using countries. The great question remains whether the consuming nations will first recognise and then accept all the necessities that this situation imposes on them.
The first of them is that the old-time conventional wisdom, to take traditional steps to reduce the growing deficit on the external account, has largely to be abandoned. For the time being we all have to live with these deficits. This does not mean that countries like ours which have a non-oil deficit must not do what they reasonably can to get rid of it as fast as possible. But if they are to do so, then the surplus countries must make it possible—or refrain from making it impossible. And all the advanced countries must do their best to help the developing countries to solve their new and massive problems.
The danger is, of course, that the world financial system can break down unless the problems of recycling the surplus oil funds are successfully resolved. We are facing a terrible combination of external crises: a monetary crisis, a fuel crisis, a crisis of relations with the Third World, and there is the possibility, as has been said this afternoon, of another war breaking out in the Far East. There is no simple solution for Britain on her own. The noble Lord, Lord Segal, and I heard a Frenchman say this morning that any country which seeks a remedy in concert with another single country is asking for failure. Britain can advance to a solution only in concert with the world and, I believe, in concert with her partners in Europe.
My Lords, my Party is of course totally committed, as the noble Lord, Lord Greenhill, reminded us, to seeking the view of the British people as to whether we should remain in the Community. There was a certain value in accepting that obligation. What I regret, as the noble Lord, Lord Greenhill, did, is that we are tied to a date-line not later than next October, and by that time we could be in the midst of a crisis that could make a campaign of the kind we would have to have a shocking irrelevance. If, as I suppose, we cannot with honour, postpone the vote beyond October, perhaps we can, as the noble and learned Lord who sits on the Woolsack suggested, take

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it in the spring of 1975 if that seems to be a propitious moment. Perhaps our partners in Europe will understand that it is in all our interests, theirs as well as ours, for this new deal that we are asking for to be completed as early as possible so that Britain can make finally her great decision.
5.47 p.m.
LORD BOURNE: My Lords, I have only two points to make on the gracious Speech, but, first of all, I should like to congratulate the noble Lord, Lord Greenhill of Harrow, on his maiden Speech. He obviously had to say a hell of a lot in a short time and I hope he quickly comes again to take part in our debates. My first point is an international one, and the second is about NATO. I would suggest that there is grave danger in reducing the Forces again. Please, my Lords, let us remember that they were reduced by 346,000 by the Conservative Government, followed closely by the Labour Government in the last 18 months, and they have already thinned themselves down to the point where they are not very strong. I only hope that the intended cuts, if there are to be cuts, will not go below the safe minimum.
Defence is the servant of foreign policy, as has often been truly said, but we have given up power in the Far East, in South-East Asia, in the Arabian Gulf and very nearly in the Mediterranean and the influence of our foreign policy is not what it was. Of course it is no good looking back, I admit, but before the war the Indian Army and the British garrison in Egypt kept the peace and there could not be a war without the British taking part in it. Even as recently as 1957, I had under my command 50 Centurion tanks of the 10th Royal Hussars at Aqaba. They kept the peace. They knew in Baghdad that it was only a matters of hours, and they knew in Cairo that it was also only a matter of hours, and it was a great mistake, in my opinion, that we withdrew those tanks. There have been goodness knows how many wars since then, so I do not envy the people who have to conduct our foreign policy in that part of the world.
I suggest, also, that defence is usually a whipping horse on these occasions for
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cuts. There ought to be all-round cuts. The gracious Speech is necessarily vague on the point, although it hints at future expenditure on the Health Service, education and investment coming before defence. I should like it explained to me. Always it is defence which is affected.
I have a mechanical point on the method of calculating defence expenditure, which is 5½ per cent. of our G.N.P. It is top of the list for NATO, but it is not necessarily so. Measuring it by head of population, for example, Federal Germany comes out 191 dollars per head; France 176; with the British third at 154. It can be measured by any means one likes. I suggest it would be better to aim at the minimum requirements of defence and leave it at that—not join a league.
My second point is about NATO. General support for NATO is good, so far as it goes, but something is left out. This morning I was checking the successive Defence Reviews, not one of which has mentioned the defence of sea communications. For centuries this country has been dependent upon two things—keeping out an enemy in the low countries, and defence of our sea communications. Remember, my Lords, we nearly lost two World Wars in succession by starvation through submarine blockade. A special feature attached to this country—it does not apply to any others in NATO—is that we can starve if we do not get our food.
On the subject of détente, I support entirely what the noble Lord, Lord Greenhill, said. Although it is the climate of opinion, it is very dangerous to assume that it has taken place. I have written down in my notes, "It is not yet a fact." I do not believe it is. I ask the Government, through the noble Lord, Lord Goronwy-Roberts, whether the Statement on the Defence Estimates 1970 (Cmnd. 4290) is still true. It said:
"Altogether some thirty Russian divisions and 1,900 tactical aircraft are … opposite the … Allied Command Europe,"
the central front.
"At sea, the Russian western fleets alone include about 257 submarines … 400 strike … aircraft and ninety sizeable surface ships."
Are those facts still true? If so, there has been remarkably little détente so far. It is dangerous to assume that détente is necessary, although we look forward to it. We still are looking forward to it. My

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Lords, I believe that the Warsaw Pact, backed up by the Soviet Union, is still going ahead. The disparity of two to one is worse than it was when NATO was set up 25 years ago. I intended remarking about careers in the Services, but I think that comes later.
Lastly, I refer again to sea communications, which are of vital concern to this country. I suggest that the defence of sea communications is wider than NATO. Although it includes the absolutely vital North Atlantic route, equally vital is the Cape route, particularly if the Suez Canal is shut. If the Canal is opened the position will not be any better, because the Russians and the Egyptians can open and shut it according to their requirements now that we have lost Aden. We ought to examine the problem of Simonstown as a base which, incidentally, a large fleet can anchor in. Last time I was there I saw a big fleet. We should look at it from the defence point of view and not purely from the political point of view.
My Lords, the fact that there are now 45 black African States against only five when the agreement was drawn up does not impress me; because none of them has a navy worth a damn. In this connection, I suggest defence ought to be seriously considered. We await the Defence Statement at the end of November with great interest.
5.57 p.m.
THE EARL OF GLASGOW: My Lords, when I tabled my name last week to speak to-day it was my intention to strike a blow not only for the retention of the Simonstown Agreement but also for its forwarding. During the days between, and as time went on, and I tried to think about what I would say, every day I found myself overtaken by events. If what I have to say now is a little disjointed I hope that I may crave your Lordships' indulgence.
Much has been said already to-day about Simonstown. A few wise words came from my noble friend Lord Bourne who preceded me. I feel strongly on this subject. If I have an interest to declare it is that in 1949–50 I commanded a frigate on what was then the British South Atlantic Station working out of Simonstown. Many of the senior officers in the South African Navy in recent times have been personal friends. In the last two years of the war I played a
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small part in trying to find destroyers from the Eastern Fleet to defend the Cape route. My sister was drowned at sea when her ship was torpedoed after rounding the Cape in the early months of 1942.
My Lords, I wish to begin by considering the strategic aspect. My noble friend Lord Bourne has brought back again what one can never repeat too often—how absolutely vital are our sea communications, particularly in times of confrontation and war. A large proportion of our shipping, and allied shipping, comes round the Cape. The reopening of the Suez Canal, as already stated, is totally irrelevant to the problem. As my noble friend also said, the Egyptians can open and shut it at will. We are threatened with another Middle East war which will probably shut it again anyway. The chances are that in any future conflict, as in the last, the Mediterranean will become untenable and the Cape route will be vital again, as it was in the last war.
My Lords, for the first time in history the Russians have established a formidable presence in the Indian Ocean. This will increase with the opening of the Suez Canal. The fact that this presence is at the moment being used for peaceful penetration does not make it any less dangerous in war or times of tension. Noble Lords must be well aware of this, and it seems idiotic to have to repeat it; but it is equally dangerous to ignore it simply because we have now lived with it for a number of years.
Our defence lies in the Simonstown Agreement. It is well known that successive Labour Governments have lived very unhappily with the Simonstown Agreement, and in fact it began to wither on the vine in the late 'sixties, when a previous Labour Government first took the step of withdrawing the British Naval Commander-in-Chief South Atlantic, whose duty it was to co-ordinate the activities of the British and South African Navies in the South Atlantic. Later came the embargo on the sale of arms to South Africa. These arms were sophisticated frigates, submarines and modern aircraft, none of which by the longest stretch of imagination could possibly have been used in civil disturbances or to quell a black revolt. What that decision lost to this country in

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jobs and foreign exchange I do not know, but the French and the Portuguese were not slow to jump in and fill the gap. The legacy of all this is that, instead of being confined to British stores and spares, South African naval depots now provide stores and spares for French submarines and Portuguese frigates.
It is said in some quarters that South Africa and ourselves would not anyway be able to defend the Cape; therefore, it is better to forget about it and let the Simonstown Agreement die. This is surely totally defeatist. The Cape route is of considerable concern, not only to the United States but also to most countries in Europe. In any future conflict we could expect considerable support, particularly from the United States and France, in the defence of that route. In this event perhaps the biggest contribution we could make would be to offer to share the facilities of Simonstown with our allies, with the agreement and co-operation of the South Africans.
My concern in speaking tonight, my Lords, is defence, but in passing I should like to make three rather general remarks. First, it has been asserted that any defence dealings with South Africa so infuriate the black African countries that it lays them open to Communist influence. But are not the Chinese already building roads and railways throughout black Africa? Are not the Russians already established in various places, building ports, bringing in industry and selling arms wholesale to all these countries? The opposition to apartheid by all political Parties in this country is well-known. Who are we trying to appease, and for what reason?
Secondly, the policy of apartheid, however much we all dislike it, has softened over the years. If we are to be realistic, the lot of many of the subjects of the black African dictators is much less enviable than that of their brothers in the Union of South Africa. Over the last few years the South African Government have been trying very hard to establish friendly relations with their black neighbours, and not without some success. Would not the British Government be in a better position to forward this initiative if we still maintained commercial and defence links with both sides? My third point has already been mentioned
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by the noble Lord, Lord Carrington, and by the right reverend Prelate. Our commercial links with South Africa are close and of great importance to both countries. No British Government have ever suggested that these should be severed. Could not mutual defence—also vital to both countries—also be removed from the political arena? The proposed situation is, as has already been said, pure hypocrisy.
My Lords, I come to the recent naval visit to Cape Town, which seems to have sparked off all this trouble. I have not of course been privy to the details of this visit; nor have I any knowledge of what instructions were given to the Admiral. But from all I have read, and drawing on a lifetime of experience of such visits, the senior officers appear to have conducted themselves entirely correctly, both in terms of protocol and of official entertainment. What cannot be controlled by diktat is the private hospitality offered to officers and men of the fleet by a warmhearted and generous people. Such hospitality would be returned in the time-honoured naval way by inviting hosts and their friends on board ships to meals or drinks. Such exchanges are private and personal—and, as I know to my cost can be very expensive, even at duty-free prices. Any attempt to put a stopper on this practice because it might offend, let us say, General Amin, is an absolute travesty of civilised human behaviour. Nor can you expect ships' companies to be ordered to remain on board their ships after two or three weeks at sea during which they have exercised very hard indeed.
My Lords, at least one-third of the white population of South Africa are our own kith and kin. The remainder are descendents of the ever-friendly Dutch, with a small minority of French Huguenot stock, for whom throughout history this country has always had a warm regard. They are not fanatical, sadistic, racialist tyrants, as they are sometimes made to appear. Those of us who served in the last war will never forget the lengths to which the South Africans went to look after and befriend our Armed Forces returning round the Cape from the battlefields of North Africa and Burma and from the Indian Ocean. They established vast organisations, superbly run, to give our fighting men a brief rest from their labours, and

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they lavished upon them kindness and hospitality. Surely, my Lords, if an old and trusted friend with an almost insurmountable trouble on his hands is handling it in a way which we are unable to support, that is not the moment to snub him, to send him to Coventry, to treat him as a pariah and encourage others to do the same. Should we not instead retain our close personal friendship while agreeing to differ and exert our considerable influence in persuading him to change or modify the methods which he uses and of which we disapprove, in the solution of his problem?
In a way I thought the crunch came last week in the Security Council of the United Nations, and I can only congratulate the Government on standing firm with the United States and France in vetoing the Motion to expel South Africa from the United Nations Organisation. Despite the difficult situation in which the Government were placed with their own Party, I like to think that some of the arguments which I have deployed had an influence on that decision. What I cannot congratulate the Government on is their attitude towards the Simonstown Agreement. To end this Agreement unilaterally would be very damaging to this country in a wide sense. Much pious reference has been made to the Defence Review. This is a red herring—and red is probably the right colour. The Defence Review is a continuous process, and the savings which would result would be negligible. The decision, if taken, would be seen to be a purely political one to appease the Left Wing of the Labour Party and the Governments of certain countries abroad, in particular those of the black African States. I do not think that any of these bodies of opinion has the best interests of this country at heart.
Nor would such a decision redound to our credit with our real allies in Western Europe and across the Atlantic. It would be assumed, rightly or wrongly, that we had abrogated our responsibilities in the South Atlantic and to some extent in the Indian Ocean. We must be prepared for France or some other country to step in, to make their own Simonstown Agreement and to assume our responsibilities. Fond as I am of the French, I would find this deeply humiliating. Finally, and most import-
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ant, by severing all co-operation with the South African Navy we would greatly weaken the ability of the Western Powers to defend the Cape route against a far more formidable potential enemy than we have ever before encountered. Time is running short, my Lords, but I can only pray that in the few weeks which remain wiser counsels may prevail.
6.10 p.m.
LORD O'HAGAN: My Lords, quite a number of the speeches made this afternoon in your Lordships' House have made a respectable case that the best answer for the allocation of the fourth television channel would be to give it to your Lordships; and one of the moments which would have been most worthy of general transmission was the distinguished contribution of our new colleague on these Benches, the noble Lord, Lord Greenhill. I cannot possibly hope to follow him in the scope and depth of his comments and I shall restrict myself to one small aspect of the gracious Speech. I shall say a very few works about Britain's membership of the European Economic Community.
My Lords, I am very glad the question mark will soon be removed. I am very glad that the uncertainty will be dispelled. Whatever the outcome one way or the other, continued uncertainty of the sort we are going through now is good for nobody and, although, as a Parliamentarian, I regret that the mechanism of choice may well be a referendum, if the other place—the elected House of Parliament—chooses to limit its authority by setting up such a procedure, I, as a democrat, accept that. I am not one of those people, I hope, who denigrates the motives of those who disagree with him, and I hope that nobody who disagrees with my point of view on British membership will think that anything that I say implies any criticism of their sincerity or patriotism. I am not a bigot.
I do not believe that there is no future for Britain outside the Community. Of course there would be a future for Britain outside the Community. But what sort of future? As the terms of renegotiation become clearer and as the changing nature of the Community becomes more apparent and its likely evolution—not the mythical evolution foreseen by the "Euro-bogeys"—becomes more obvious, a very heavy responsibility will fall on

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those who oppose British membership; because I suggest that they will have to keep pace with the Government and the Community in offering alternatives. If the real nature of the Community and of the renegotiated terms becomes more evident, then the real nature of the alternatives—if they exist—should also become more evident, if they can be made so.
As an incorrigible seeker after truth in these matters, I went the other day to hear Mr. Enoch Powell speak at Chatham House. He made a number of philosophical observations, and among other things he said that all inflation was domestic. One of my other disciplines is to read Tribune regularly and, shortly before the Election, I noticed that Mr. Jack Jones was on record as saying on October 2 that a large part of our inflation was directly or indirectly attributable to Britain's entry into the Common Market. Mr. Enoch Powell and Mr. Jack Jones—whatever else is between them—are twin ornaments of the tiara of the anti-Market campaign and if, in their analysis of the causes of one of the most fundamental threats to the stability of our society and of the world monetary and political order, they cannot agree upon the extent to which inflation is affected by the Community, what is there that can bind them together in offering an alternative future for Britain outside the Community? With great respect, I say that if Mr. Powell believes that leaving the Community will bring inflation home where it belongs, and if Mr. Jones believes that leaving the Community will send most inflation back to Brussels where he thinks it belongs, it will, during the coming months and when the referendum campaign gets under way, be incumbent on those who are against Britain's membership to reconcile those differences of analysis and to present to the country some well-founded, well-costed, well-documented alternative scenarios for Britain's future.
I am not going to use the debate to-day to go through all the arguments that we will be hearing for or against membership of the Community. There will be a debate on Thursday. There will, I hope, be regular debates on the Reports of the Select Committee of your Lordships' House on European secondary
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legislation. There will be debates, as I understand it, on the six-monthly Reports by the Government on the British membership of the Community. It will be during those debates, and during the greater and wider debate that will begin to take place in the country before it takes a decision, that I shall try to argue some of the more detailed points. However, I would say that it is a mistake to underestimate the ability of the British people to grasp complex issues and that people who do so, do so at their peril. I am looking forward to the referendum campaign because I believe that the great debate that never happened before our entry will now take place and that those who want us out will be forced to say what they would do with us instead, think that they will have difficulty in convincing the electorate that there is a satisfactory alternative to British membership which can provide for a Britain with a, perhaps, diminishing role in the world, the safeguards that it needs to maintain the standards of living and all the other things to which it has become so accustomed.
I am cautiously optimistic. I should like to echo the words of the noble and learned Lord who sits upon the Woolsack, when he said that the economic map of the world had been transformed over the last year. That transformation has reinforced the fundamental reasons that move people like me to be enthusiasts for membership of the Community, and simultaneously it has undercut many of the old arguments against membership, particularly those on food prices, which I shall not enter into to-day.
My Lords, I would say to Her Majesty's Government that I wish them continuing success in the renegotiation which they have so far carried on, and that I look forward with pleasure and with no foreboding to a referendum campaign in which they will be able to recommend to the British people as a whole that our best, if not our only, future lies inside the Community.
6.20 p.m.
LORD WIGG: My Lords, it is indeed fortunate that I speak after the noble Lord, Lord O'Hagan, because I can help him a little. I spoke on the same platform with Mr. Enoch Powell and Mr.

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Jack Jones in Pudsey and I was the chairman for Mr. Enoch Powell's meeting in Lancashire. I do not want to be rude to the noble Lord, but I feel that any difficulties he may have in understanding the position come from his failure to comprehend rather than any failure of logic or of explanation by either Mr. Enoch Powell or Mr. Jack Jones. Indeed, the noble Lord answered his own question. He commented that he has great faith in the British people: so have I. I have every reason for saying that, because I won a Conservative seat and held it in seven Elections. I suppose I have been as much misrepresented and vilified as anyone in public life, and I still come up smiling. It does not matter if people say I am wrong: what matters to me is the number in the frame at the winning post.
The noble Lord says that he has this great faith in the British people and welcomes the possibility of a debate. Well, who is responsible for the fact that there was no great debate?—a Conservative Administration and a Conservative Prime Minister who promised that the British people should have the opportunity to express their views and said that we should go into the European Community only with the full hearted consent of the British people. We were denied that opportunity. Who holds the major responsibility?—this House. Conservative Leader after Conservative Leader, including the noble Lord, Lord Carrington, has put the case in more recent times, but it has been said during the whole of my life that this House exists for two purposes, which I support. One is its function as a Revising Chamber—as the pressure gets greater in the elected Chamber, the more necessary it is to have a revising instrument. Secondly, this Chamber is a delaying instrument; and if ever there was a case for legislation to be held up until the British people had an opportunity of saying "Yea" or "Nay"—not by means of a referendum but by a General Election—it was the Treaty of Accession Bill. But this was denied them. I would say to Her Majesty's Government: "Do not trust this place. This is the home of reaction." I regret that in the gracious Speech there is not one reference either to the abolition of this House (which I should regret) or to its reform. If ever there were any signs
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in the country of losing by elections, the occupants of these Benches will quickly find out how deep is the sincerity of those who wish the Government well.
We have been through this before. Long, long ago a Liberal Government found this out. This place has always existed for one purpose: to preserve the wealth and privilege of a small select class—and, my Lords, your day has come. The hour has struck. There has emerged in this country another force, and for the moment you have to live with it. That is the power of the trade unions. The case is made as if all our problems are due to inflation, and that inflation is due to wage demands. Of course, excessive wage demands exacerbate an already difficult problem, but the fact is that throughout the whole of capitalist society—and this is why inflation is endemic—there have been major structural alterations which have not been recognised. There exists the power to produce goods and services like a cascade, by day and by night. These have to be consumed or the machine chokes. In 1929 to 1931 there was an attempt to curtail the flow and the world rocked, choked with its own surpluses.
Now there is another force: the force of television. How many times have I said this to your Lordships?—day after day and night after night, television stimulates wants which have nothing to do with anything constructive. It is the old story—something to eat, something to drink, something to make people look nice, somewhere to go on holiday, something for the dog or the cat—and yet the crisis we are faced with is under-investment. That is why there is no growth; and you cannot go to the wageearner—even the trade union leader cannot do it—and put the emphasis upon investment, because he has been taught to consume. He has been taught to get wages. So he or his wife sees the person next door wearing something new or using a new gadget: he wants it too. Therefore you have to live with inflation, whether you like it or not; and the only way this country can solve its difficulties—and it may be a very hard and narrow race—is to get a contented, understanding and indeed (drawing upon one's wartime experiences) an enthusiastic labour-force which trusts the political institutions and the instruments which

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provide the means of government. Unless that exists, then you will not get the co-operation you seek.
That is the major case against the Common Market and the case for the referendum. You cannot get this instrument, which, if I may say so with respect to the noble Lord, Lord Greenhill, is a creation of the Foreign Office and its francophile tradition. It has been pushed across whether we like it or not—and we do not like it—and Mr. Enoch Powell, Mr. Jack Jones, myself and others (and I am going to a meeting to-night) will do everything in our power to ensure that the British people have the case clearly put in front of them and that they have the chance to say "Yes" or "No". If they are not given that clear choice, then all is ashes. That is the problem and it has to be faced.
I want, if I may, to turn to the subject of defence, and I must say that almost every word that has been uttered during this debate causes me most profoundly to disagree. I should like to turn to some very wise words of the Foreign Secretary, speaking in another place on October 30, when he said:
"Of course Britain has a role to play in the world."—[OFFICIAL REPORT, Commons. 30/10/74, col. 230.]
Then a paragraph later he says this:
"Having said that, there is a large role for Britain to play and many people in all parts of the world are looking to us to play it."
But we require on our part a sense of realism about our capacity to influence world events. We are a medium-sized Power and we are not at present among the strongest of these. Indeed the choice for us perhaps, with the emergence of super-Powers, is that we could be at the bottom of the First Division or the top of the Second Division. We did not make that choice. We went for the illusions of power, and the result is that we have the bill but not the power. So we are falling all the time to the bottom of the Second Division. That is the truth of (he matter. The reason is that those like the noble Lord, Lord Bourne, and the noble Earl, Lord Glasgow, are the products of a bygone age, political dinasaurs. To-day what matters are not Armed Forces, as expressed—and which are so pleasing, I am sure, to the British public and to every Member of your Lordships'
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House except myself—in the spectacle of the Trooping the Colour, because that is part of the fairy story. What matters is the totality of power; and if I may put it in an extreme form, if I had to choose between a frigate at a South Atlantic station and a team and training facilities to teach our footballers proficiency in a game which we invented, so that we could win the World Cup, I would choose the game of football, because that is part of the totality of power. Some 1,200 million people watched the World Cup final at Munich. We were not there because, although we could, we do not provide the facilities for our young people to take part in sport on the international scale which would ensure prestige for this country. There can be no Spitz produced in Britain, because there are not the swimming baths of Olympic standards. We will not be able to produce people who can dive to get gold medals, because there is only one bath suitable away—in Cardiff. And so the story goes on.
I did not come to your Lordships' House on the festive occasion last week; I watched it on television. It was a fairy story which begins, like all fairy stories, "Once upon a time". The Queen's Speech was delivered among the great ones of the land, and it was televised so that all could see it; all could share in the glory that is ours. A couple of hours later I travelled on a plane to Algiers. I witnessed celebrations of independence, where 15 million people, by their valour, had taken their independence from the French. It was not given; it was taken—although the French killed 1.500.000 people in the process. There were 13 Heads of State there, and representatives from 100 governments—China, Russia and every Latin American country, including Miss Allende representing Chile. There was no Minister from Britain. I stayed at the Alletti Hotel and talked to an Australian Cabinet Minister and Ministers from Norway; but there were no Ministers from Britain. The Algerian ambassador held a reception at Claridges Hotel and there were 700 people celebrating Algerian independence, but there was not a single Minister from the Foreign Office.
You can have it one way or the other, my Lords. You can have your little bill, and your defence, or you can realise the reality: your power to influence men by

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the fact that you have a society which is cohesive and disciplined, because people understand the objectives and share them with enthusiasm. I witnessed a parade on the Avenue de Liberation from the airport into Algiers last Friday morning. There was a parade which demonstrated clearly the continuity of the revolution. The last 50 minutes of it showed the armed forces. The Brigade of Guards could well attach some of their instructors to the Algerian Army and learn how to march. There was no great display of weapons—there were no tanks, but light automatic weapons. There was a demonstration of a people who had struggled and won and knew what they were after, and were determined to get it. That is what has to be recreated in this country. You are not going to create it if you try to twist them as they were twisted over our entry into the Common Market.
LORD O'HAGAN: My Lords, I am sorry to interrupt the noble Lord, but he said he was going to educate me. Could he explain how this spirit that he would like to see recreated is to be recreated by Britain leaving the Community?
LORD WIGG: My Lords, it would be created by giving the British people the choice. That is what matters. On every plaform where I have spoken about the Common Market I have always said the same thing. If the choice goes against me, like the noble Lord, Lord O'Hagan, I am a democrat and I accept it. But I am not going to be a party to the people of this country being treated as a defeated Power. That is what is happening at present. It was M. Lardinois who said "What is the good of a referendum? The ordinary people cannot understand." But how little does he understand about the British people!
Therefore, it is not a question of coming out; it is a question of education. This is what an election is about. The noble Lord, the Lord O'Hagan, has not had the privilege of fighting an election. What matters is not the decision at the ballot box; it is that for three weeks the mind of the country is concentrated on great issues. Of course the public do not understand the details; they do not want to. But they can take the broad decisions on this issue to come in or stay out.
LORD WINDLESHAM: My Lords, before the noble Lord leaves that point, he has had a very long and distinguished career in public life and fought many elections. Has he never felt in the past that an issue was so important to the future of this country that it should be put to the people in a referendum? Or has he changed his view now that he has retired from active public life?
LORD WIGG: My Lords, by and large, I believe in the sovereignty of Parliament. Because we were taken in as we were, when we were promised we would go in only with our full-hearted consent, I want the referendum in order that the public may be educated. It needs to be recognised that those who said—I would not include the noble Lord, Lord O'Hagan, although it is probable—" They were the best terms we could get. The Labour Party cannot get any better terms" are now saying, including the noble Lord, Lord Greenhill, "We have much better terms already, so let us go on negotiating and we will get even better terms." In other words, they are hedging their bets because the policy of renegotiation, on which only a few weeks ago contempt was being poured, is succeeding.
LORD WINDLESHAM: My Lords, that was not my point. Does the noble Lord, Lord Wigg, accept, or does he not accept, that this is a constitutional innovation to hold a referendum?
LORD WIGG: My Lords, of course it is, just as it was in Northern Ireland. We have no written Constitution; we have always said that we play it by ear. A situation is reached here where it is obviously desirable that the British people should be consulted. The Conservative Party would have been wise—and but for the stubbornness of Mr. Heath, it would have done so—to accept the principle of renegotiation. I have great respect for the noble Lord, Lord Windlesham. I believe that in his quieter moments he would agree with me that it would have been wiser to accept a referendum; in other words, accept the Sovereignty of the British people.
THE EARL OF LYTTON: My Lords, I am grateful to the noble Lord for giving way to me. I have a problem which was brought strongly to my notice by the

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noble and learned Lord, Lord Gardiner, about this very subject when he was talking about capital punishment. Going around village halls, he took a vote at the beginning of each meeting and found there were 2 to 1 in favour of capital punishment. After he had argued the case, the vote was taken again and it was found that there were 2 to 1 against capital punishment. In this case we are going to have not one Lord Gardiner arguing with all his tremendous eloquence on the relatively simple matter in one direction; we are going to have people arguing in opposite directions. How are the uninformed British public to be informed?
LORD WIGG: My Lords this is quite extraordinary! This is supposed to be a mature assembly. Democracy is not a hot-house plant. It was not born in Oxford common rooms; it was born by argument, by strife, by men arguing. They realised something: argue, dispute, be strong minded—abusive, if you like—but it is the most civilised way, with all its imperfections, that men have discovered of governing themselves. It comes by contradiction. That is how ordinary men make up their minds. In this country the die is cast against the ordinary man.
The noble Lord, Lord Greenhill, is a governor of the BBC. They, like the Foreign Office, long ago made up their minds about the Common Market. I listened to the overseas news—ceaseless propaganda in favour of the Common Market. What chance does the ordinary chap have if he listens to the B.B.C. or reads the British Press? In the long run, my faith in my fellow citizen is greater than that of even the noble Lord, Lord O'Hagan. Despite the B.B.C., despite the Press, I believe that in the long run the British people will take the right decision.
LORD GREENHILL OF HARROW: My Lords, may I interrupt?
LORD WIGG: Certainly.
LORD GREENHILL OF HARROW: My Lords, lest silence should indicate consent, the noble Lord speaks about ceaseless propaganda on the B.B.C., and, quite honestly, I think that anybody in this House who has listened to the B.B.C.
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over many months would know that that is not correct.
LORD WIGG: My Lords, I assure the noble Lord, Lord Greenhill of Harrow, that if in respect of the last two or three days he would ask the Overseas Service to play back to him some of the broadcasts which I have heard, he would find that every single one has been biased in favour of our membership of the E.E.C, or statements such as this have been made:
"Of course, it is generally understood that the Government will recommend that we shall remain in the Common Market."
This is commonplace.
I trust that I shall be allowed to continue because I want to make one or two further points. What I was trying to demonstrate was that Armed Forces as we know them, measured in terms of tanks or frigates, are a load of nonsense. Let us examine the Simonstown Agreement. I regret that the noble Earl, Lord Glasgow, is not present because he is a distinguished naval officer; but the noble Lord, Lord Bourne, is present. Let us demonstrate what nonsense this is. Simonstown—go and have a look at it! It looks about as important as Bognor. Something like that; or perhaps I wrong it and should say one of the nicer resorts—Southport, or a South Coast resort. As one drives along the front one finds the houses are quite close to the sea, and what does one see? House after house is a boarding house placarded up. "Rhodesia by the sea," it says. I was there not so long ago.
Let us consider for a moment those who think we should retain the Simonstown base as a means of defence for the journey round the Cape. Let us assume that the Russians have taken the bit between their teeth and have decided at that distance to interfere with the flow of trade. It is rather like Lord Avon's forecast about the Suez Canal being a knife across our jugular vein. We know how true that was. Let us assume, then, that the might of the Soviet Union is then placed in the scale and it is going to take extreme steps to interfere with our trade. Does any Member of this House seriously think that the Simonstown base, which it is argued is vital, would continue in existence? How long for? Five minutes? Ten minutes? Do these noble Lords not hear a rustle of missiles at this range?

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If this base is said to be of such strategic importance as to be a matter of life and death, not only to Britain but the Western World, does anyone seriously, honestly think it would continue to exist for any longer than it would take to fire a missile from a Soviet base? To argue the case is to demonstrate the utter futility, the complete out-of-dateness of the thinking of people who argue for the essential nature of Simonstown.
There is another factor about Simonstown. This, it is said, is so necessary because the Russians have intruded—that is perhaps the word; "sailed into "would be perhaps less tendentious—into the Indian Ocean. So, then, if the Indian Ocean is important to us, would one not have thought that this country would go out of its way to make friends with the Indian Government? The Foreign Secretary has seen the Indian High Com missioner once since he took office last March—once, and then only when the High Commissioner was making a duty call. Never during the office of any of the Labour Governments has any Minister of high rank visited India. Oh yes, Mr. Heath went—on his way, I think, to Singapore. Sir Alec—God bless him!— went. But is not the friendship of India, in order to have the security of the Indian Ocean which we are told is vital to us—
LORD GORE-BOOTH: My Lords, may I interrupt the noble Lord for just a moment. Mr. Michael Stewart, to do the Labour Government justice, visited India in my time.
LORD WIGG: My Lords, the information I have is that no senior British Minister has done so, certainly not since March; but I did make—
LORD GORE-BOOTH: Not in the present Government, my Lords; I am sorry. I thought the noble Lord was referring to the whole period.
LORD WIGG: No, my Lords, I will not run away from it. Certainly not since March. And the Indian High Commissioner has made one visit only. He did receive a letter written in rather avuncular terms by the Foreign Secretary—rather like uncle writing to one of his nephews about Christmas time; the kind of letter with which he sends five shillings and wishes him well for the next year—
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and he sent rather a dusty answer. My information is that no senior British Minister visited India during the period. If I am wrong I naturally accept such an authority as the noble Lord, Lord Gore-Booth.
I am very pleased to learn that Prince Charles will make a visit to India early in the New Year. I take this not to be the influence of the Foreign and Commonwealth Office; I think this must be the influence of Lord Mountbatten! But I do not mind: I welcome it. But I do not want our foreign policy run that way. It is a step in the right direction. But the point I want to make and drive home is that it is completely out of date to think of defence in the terms in which it has been thought about and talked about in this House this afternoon. It has no validity at all. We have to think in terms of the totality of defence. We must accept the totality of force. It includes not only military force but economic force, the power of propaganda, the victories at sport. This is why the Soviet Union puts her great resources into winning sporting activities. I am astonished at the noble Lord, who is a forward-looking man, who talks about defence in completely out-of-date terms, and then says, "Of course, there is this about détente. There are so many Russian tanks." Why does he think the Russians train their young people to go all over the world to get a harvest of gold, silver and bronze medals, except of course to demonstrate the power of the Soviet Union in that particular field? It seems to me so simple, so obvious, and yet I go on banging my head against a brick wall in trying to make this clear.
I want to put defence in terms which are quite startling. I have done some homework; it has taken me a lot of time to do it. I have tried to ascertain beyond any shadow of doubt the total defence expenditure by this country from 1946 to the end of 1973. I take it to the end of 1973 for this reason. I am going to ask the quesion: What have we got for it? At the end of 1973 a Conservative Government were in control, and obviously they were continuing the policy of Governments based on the previous 1957 White Paper. This is at a time, by the way, when this country is looking round for a few hundred millions. Since the end of the war we have spent £51,943 million. Our total expenditure

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on defence up to the end of 1974 will be £55,000 million.
Now what have we got for it? Well, I am sorry, but we did not get peace because of that expenditure. That is perfectly clear. The noble Lord, Lord Orr-Ewing, as usual, talks without thinking. Let us examine it together. In Cyprus there were two sovereign bases. So here we were uninhibited, in complete control. We had a defence policy which had twice as many women and children as there were men. We had to reinforce it—not in order to discharge any international obligation; we had thrown a hal in the ring so far as that was concerned. We did it because we had to put troops in in order to protect the women and children. This may be marvellous, but it is not a defence policy exactly. And when we needed reinforcements we had not a battalion to put in. We put in a battalion of the Gurkhas, which is marvellous, except of course that if you have the Gurkhas it is difficult to find a place to use them. That is the situation there.
Turning to the Rhine Army, I regret the absence of the noble Lord, Lord Carrington, because he is a bit of a "corker". He talks about the Labour Government going back on its promises, on its defence commitments. Was it a Labour Government which committed Britain to maintain four divisions and the Second Tactical Air Force on the Continent until the end of this century? Was it a Labour Government which walked out on it? It was a Conservative Government. We have got the word of Mr. Churchill. Go and look at Lord Moran's diary. Mr. Churchill said, "Oh, that? I don't believe a word of it. I don't intend to do it". So what is the good of coming along and talking this kind of poppycock? The fact is that we have a defence policy, based upon the 1957 White Paper, which is costly in the extreme and which guarantees to do one thing. It produces no defence. We can no longer afford to put abroad forces of that kind, and the quicker we bring the Rhine Army home the better because they could not fight. They are committed to a forward position but the only atomic tactical weapons that they have are completely obsolescent. They are the same old 8 ins. howitzer, the same old Honest John, with a range of 12 miles. They have to hold a forward position because
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their range is only 12 miles; so, if ever things go wrong, in the first two hours they are "in the bag". I do not regard that as a policy at all. It is absolute nonsense, and this is where I come to Lord O'Hagan.
My Lords, he will go round the country and will say, "What is the alternative?". We come out, if that is the view. There is a going concern, of which we can be a member. There is this country's record in terms of international co-operation. It is among the best in the world. There is no reason at all why we should not co-operate with anybody over anything. We can co-operate on a functional basis. But when I am in Algiers and I see President Boumedienne as chairman of the non-aligned countries—76 of them. 77 in all—with over 100 States represented, I say to myself, "I dont' want Britain to be at the bottom of the second division. Britain ought to be amongst the non-aligned countries". We are not a great super-Power and we canot afford the defence bill. If, therefore, we join the non-aligned countries, by 1980 Algeria will be exporting more gas than anybody else in the world: they have the greatest gas deposits in the world. We are joining those Powers who have great economic resources. So have we. We shall ultimately need to harmonise our oil policy with theirs; so why not get among them? And, if it means giving a lead, they have much to learn from us. We can, perhaps, help them. We can help them because they need our technical know-how. There are markets which are open to us. There are markets for our investment. They want us.
My Lords, that leads me to the last and perhaps the most controversial of the things which I have to say. I want to turn to the problem of the Middle East. The Foreign Secretary thinks there are three fundamental needs. He said that Israel must have satisfaction of her need for recognition by her neighbours of her permanence as a State and of her legitimate security requirements. I think that is right, but again what precedes it is that any settlement in the Middle East must accept the totality. This is the mistake which Israel has made. She is supplied with the Phantoms. She is supplied with sophisticated American equipment and she thought that gave her

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permanently a position of supreme military strength. She over-looked the fact that you have to take into the balance sheet and bring into the equation the economic power of the Arab countries which has now been expressed.
My Lords, the second point is that her Arab neighbours will require the withdrawal of the Israeli occupying forces back to the 1967 line. Thirdly, the Foreign Secretary thinks that there must be satisfaction of the needs of the Palestinians—" By which", he says, "I mean not only the rights of individual Palestinian refugees". I think there is a fourth point. Jerusalem is the place where great faiths meet and there must be agreement about the faiths of this world being able to worship in freedom. I do not know the form that this will take but I am absolutely sure that, very high up in any permanent settlement, that fact has got to be taken into account.
LORD JANNER: My Lords, is the noble Lord really suggesting that people are not allowed to-day to worship in freedom in Jerusalem?
LORD WIGG: My Lords, of course they are, but they do not think so and by "freedom" they do not mean freedom with the Israelis policing the area. They mean freedom to worship in their own way and under their own control. That is precisely what they mean. It can be international, but currently the most difficult problem of all is the problem of the PLO. They are described as terrorists, but who were the gentlemen who blew up the King David Hotel? Were they members of a Sunday School party? What about the gentlemen who murdered Sergeants Paice and Martin? What were they doing? Were they collecting postage stamps? The State of Israel was established by the Haganah and by the Irgun Zvei Leumi, and, so far as they were concerned, in the process no holds were barred. That is not the way to permanent peace, and I say to those who care to listen that these are the requirements and that until those requirements are met the tensions in the Middle East will most certainly continue and while they continue there is no possibility of military peace. Then—hence my theory of the totality of force—there is no possibility of the West getting any amelioration of the conditions under which it can obtain oil.
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My Lords, may I recall to your Lordships that the General Assembly which met in April was convened at the instance of President Boumedienne who was acting on behalf of the non-aligned countries. I think that very few British newspapers took cognisance of what President Boumedienne had to say, but when he was talking about oil he talked also about other commodities and the position in which Britain finds itself will continue for a very long time to come. In this country—silently, almost without notice—there has been a revolution, a move, a shift. Exactly the same thing has happened on the international plane. Until that fact is recognised we shall go on from crisis to crisis. We shall blame this one; we shall blame that one; and we shall blame one another; we shall blame it on to oil and we shall blame it on to inflation.
I, sharing the views of the noble Lord, Lord O'Hagan, have sufficient belief in my fellow-countrymen that they will realise the true position, which requires an enlightened, a disinterested and an objective Press and television coverage but unless people can recognise the truth and be given an opportunity to learn the truth, how can they make the right decisions? It is only for that reason that I have spoken. I have spoken for far too long, but I have had my fair share of interruptions. The only reason that I have intervened in your Lordships' debate to-night is because what I have said I shall go on saying at every opportunity I can—for the most part outside this House.
7.0 p.m.
LORD ORR-EWING: My Lords, I last heard the noble Lord who has just sat down speak—as many of your Lordships did—on June 20, when he spoke for 15 minutes and he described your Lordships' House then as "a contemptible institution". He said:
"I do not want to be here. I do not like being here."
Having listened to him for 39 minutes this evening, I wonder whether he had revised his views because he seemed to be enjoying himself. He added one further slogan—" Don't trust this House"—to those he has already recorded in Hansard. I am sorry that the noble Lord, Lord Shinwell, has left because he opened our debate on the Queen's Speech with a succinct and very statesman-like speech,

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not of 39 minutes but of 20 minutes and I think we would all like to congratulate him. I thing I have spoken in every defence debate for 24 years and I was ragging him earlier that this must be the first occasion when I have not actually heard him speaking on the defence issue. He said "As I opened the debate I did not think I could speak again. In any case I have an opportunity at the Savoy Hotel to-morrow to let off a speech on defence". So we miss his wise words on this defence issue.
My Lords, I want to concentrate on two main points on defence and then move on to some remarks about British industry because like the noble Lord, Lord Carrington, I consider it is the well-being, the prosperity, the investment and the competitive spirit in British industry which makes a defence policy possible at all. I agree so much with the noble Lord, Lord Carrington, that the first priority for the United Kingdom must be the united defence of Western Europe. We must play a worthy part and we shall make it much more difficult for the United States to maintain its presence in Western Europe as strong as it is if we start to back down from our responsibilities and to further the move for less defence by some of the weaker brethren in Western Europe.
The second vital issue is the Middle East because that is where a great part of our oil must come from between now and 1980. Of course, it is no good being utterly dependent upon Arab oil unless they are able to transport it down the Arabian Gulf, round the Cape and up into Western Europe. That is why I want to say a word or two about the defence of the Cape route. Two-thirds of Britain's oil comes round the Cape. Rather more of N.A.T.O.'s oil comes round the Cape and therefore we should not allow the Russians to predominate and we should continue to exercise our right to use the Simonstown base and to exercise with the South African navy.
Yesterday in the other place I thought the Foreign Secretary spoke in much more measured terms than perhaps reports over the weekend in the Press and on the media, which suggested that we were about to withdraw. But I cannot understand why, until we have our own sources of oil from the North Sea secure and at
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a competitive price, we do not keep our options open. When the noble and learned Lord the Lord Chancellor started our debate to-day he first, quite rightly, condemned apartheid. I think we all do in this House, but he went on to say that it was the policy of Her Majesty's Government to give no help for internal oppression. But my Lords, no one is suggesting that they should. The Tory Government did not give any help: they did not supply machine guns or bombs or anything which could be used for internal oppression. But the position has tightened up immensely since then.
There are now 300 orders which have been waiting since the Labour Government came to power at the beginning of March, for the export of spares—and vital spares—for the South African military forces. Many of these, as I know from personal experience, are for such as torpedoes, radar, radio and sonobuoys. None of these things can be used for the oppression of the black majority in South Africa and I cannot understand why we cannot trade reasonably with that country. If we can supply cars, machine tools and other things why can we not supply spares to make these exercises which were approved by Her Majesty's Government realistic? In many cases they have no explosive content and they cannot possibly be used for oppression.
I went to South Africa a year and a half ago and I would point out the degree to which the French, the Italians and to a less extent the Germans are driving in and providing them with goods that we refuse to provide. It surely does not make any sense at all that a country with which we have co-operated in time of war for the maritime defence of that route should progressively have to look to other nations of Western Europe rather than to us for vital spares. I cannot help but think, as others have said, that it is pure humbug and I would urge this Government not to let themselves be bullied by their own Left Wing. By making relationships more difficult with South Africa we make it more difficult for those forces working for democracy within the Union, particularly for the Progressive Party which has recently won five Parliamentary seats. This is beginning to make some progress and if we ban and do not co-operate then we make their task in

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reversing apartheid so much more difficult.
I wish now to turn to another subject and I hope the noble Lord will excuse me if I am not here when he winds up this debate. I had hoped to be here but the 40 minute speech by Lord Wigg has made it imperative that I leave before the winding-up speech. I want to turn to some of the cuts which are predicted. We do not know for certain but we read that following the defence cuts which have already taken place and which affected our intelligence services we are to have another series of cuts. The security service, perhaps more generally known as MI5, and the secret intelligence service, perhaps more generally known as MI6 are to be further cut. These services do not use large quantities of expensive equipment. They use high-grade brains and that is very good value for money. I remember Lord Rutherford came when I was at Oxford. He was then doing pre-eminent research at Cambridge on nuclear physics, which I was studying, and I remember him saying at a time when we were having cuts all round "Gentlemen, we have not got much money so we must use our brains".
I think that is true to-day; we have a limited supply of money so let us please use our brains so that we may dispose our forces and our equipment most economically. Of course every nation makes some mistakes in the intelligence field but I think most of the Free World recognises that the British intelligence services are second to none in the world, and this is certainly recognised by the United States of America. We are now deeply dependent on the information which we receive from the sophisticated military satellites launched, serviced and read by the United States of America. If we cease to make any useful contribution to the intelligence services and knowledge then we shall not go on receiving the photographs or the wireless intercepts which we now receive from that country. So I suggest again that we should look most seriously at the whole business of cutting our intelligence staffs.
I now come to the third and last portion of my speech, and that is my sadness that so little was made in the Queen's Speech of the importance of British industry. When the Labour Party came to power in 1964 much was made of the fact that
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there was a deficit of £800 million in the balance of payments. In fact it turned out to be rather less than that; it was £382 million when the sums were done. But the deficit now is not £382 million; it is £3,860 million—over ten times as great, and yet we have not heard much about that. Of course, over half of that deficit is due to the price of oil and it is fair to say that mention has been made, and I hope we shall have some real drive on the issue of conserving our energy in this country. But the balance must come from the exports, visible and invisible, of British industry—competitive industry principally.
I have grown up in the engineering field of British industry and there is not one company with which I am associated which is not now desperately feeling the pinch of cash resources. We should all like to be investing in more sophisticated machine tools, in better and more up to date methods, but due to inflation we find we need vast amounts of money for funding our stock, much more than we can afford. If inflation accountings were universal we should soon realise we are not making profits on which we are being so heavily taxed. So I would have thought that line 1, page 1 of any gracious Speech, before telling us about the giveaways and the improvements to the social services or education services, or the needy, would have paid attention to the needs of British industry, which generates the power and the wealth. If you have bankrupt British industry you do not have any wealth, foreign policy, defence services, social services or any housing, so I hope the Government will give some priority in this sphere.
Yesterday in the House of Commons—I was there for a short while—the right honourable Member, Mr. Wedgewood Benn, was telling us about more nationalisation. I would echo what was said then. Surely in the present crisis of British industry this is an irrelevancy, and one which undermines the confidence of so many firms. They are all anxious to get on with the job. At this stage, why not postpone this step until we are through with the present crisis? Each day we read about firm X, firm Y or firm Z to which the right honourable Member, Mr. Wedgewood Benn, has decided to grant some millions of pounds of aid. I would ask, on what authority? Has

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Parliament voted this? Have we seen anything of this? I know of no authority. It may be that this is done under the Industry Act, but certainly these sums of money are not automatically voted. And you can operate under the Industry Act only if it is recommended by the Committee specifically set up to examine it. We know in some of these instances that the Committee has said that some of the firms which are now to get big grants are not economically viable and should not be given grants. So on what authority docs a senior member of the Cabinet spend millions of pounds of our money? He was asked, and he gave no answer, how much the nationalisation of all these firms is going to cost. One estimate is £1.000 million. Where is this money to come from? It can only come from printing; and if it is printed, it is going to stoke up inflation. So I ask the Government to think most seriously about whether this is the first and the most urgent problem. Surely the wellbeing of British industry must come first and foremost.
Now I turn, as did the noble Lord, Lord Wigg, finally to perhaps the most important question of all; namely, to what is going to happen to our sources of supply of coal and electricity in the coming winter. In March the National Union of Mineworkers was appeased and got a 30 per cent. wage award. That was meant to be exceptional, but I am afraid it has become the norm. We read that on Clydeside a lorry firm have got between 39 per cent. and 44 per cent. We are told in the Queen's speech that everything is pinned for success on the social contract. Do noble Lords realise that this is already breaking down? It is the most fragile instrument. I wished it well when it came. It is a voluntary incomes policy, and if it could have worked I would congratulate the Government. But honestly, they have left nothing to fall back on. Twenty-seven out the 39 last settlements are outside the terms of reference of the social contract, and yet they have gone through.
I do not want to be a prophet of doom, but I regret to say that I cannot help feeling that militants in the National Union of Mineworkers are not going to serve this Government any more than they served the Conservative Govern-
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ment, and that they are probably going to bring our coal supplies to a halt either in this February, or in February of 1976. I would ask: What are the Government going to do? In 1961 the late Hugh Gaitskell stood up against his Left Wing when he made that great speech. "Fight", fight and fight again". I regret to say it looks to me now as if it is: appease, appease, and appease again. That is no cure for our problems. If the situation breaks down, there is no fallback position for the Government. Then I am afraid there is no possible alternative but the formation of a Government of national unity which will face up to the problems, and which will govern in the interests of every person of every political Party in this country.
7.15 p.m.
LORD SEGAL: My Lords, this debate has already covered a very wide area. It has travelled over Cyprus, the Middle East, India and Bangladesh. I hope the House will forgive me if I carry it still further east, and refer a little to some of the problems facing the much maligned and grossly misrepresented British Crown Colony of Hong Kong. As is often the case, it is misrepresented because of the sheer failure to see these problems in their proper context by many who are superficially aware of the problems, but who, out of the highest and most worthy motives, fail woefully to approach them objectively. It is very easy to spend a few days in Hong Kong and to come back denouncing the appalling conditions of overcrowding, the bad housing, the low wages, the absence or impotence of trade unions, the denial of representative government, and of free elections, the drug addicts, the vice dens, and all the worst aspects of colonialism.
We had a notable example of this during a rather one-sided criticism in a recent debate which took place in your Lordships' House on the walled city of Kowloon, which I thought was somewhat below the usual standard of debates in this House. It was a case of special pleading, a statement of isolated facts with an almost total lack of judgment of the situation as a whole. It was, in my view, a grossly unfair criticism of a band of devoted colonial servants from this country who had dedicated their lives to the welfare of millions of Chinese who

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are refugees from Communist rule, who are daily facing problems of appalling magnitude with a quiet courage and devotion to the highest ideals of public duty which deserve a rather better recognition from their countrymen at home.
What are the chief facts, the facts that are beyond dispute? Hong Kong to-day has a population of over four million, a population that has grown more than tenfold in the last 20 years. That alone gives some idea of the problem. But why have the Chinese come in such numbers to Hong Kong? Why has Hong Kong been compelled to impose the strictest regulations against any further imigration? It is simply because, if free and open immigration were permitted from the Chinese mainland, this immigration would swell to a flood, and millions of refugees would cross the border into Hong Kong. These facts are not in dispute.
I would be the last to decry or minimise in any way the magnificent achievements of the Communist Government on the mainland of China. They have virtually stamped out famine, have brought work, hope and succour to starving millions, to nearly one-quarter of the world's total population. They have created a spirit of national pride, enthusiasm, purpose, energy, and will to work that has stirred the imagination of countless millions of oppressed people all over the world. They have recreated China into one of the world's great Powers. Why, then, is there this urge on the part of millions of Chinese to escape from Communist China into the so-called hell of Hong Kong, that den of iniquity that symbolises the worst vices of colonialist rule?
The answer is simply this. There will always be some people in every country, perhaps a minority of people, who wish to be free—free to think for themselves, free to express their thoughts, however ignorant or misguided, openly without fear of reprisals or punishment or retribution of any kind. They wish to be free to work and to worship, free, within certain social limitations, to bring up their families, to educate their children, to have access to news unadulterated by propaganda, free to live their own creative lives with a minimum of interference by the State. In Communist China these people have to conform. Work is available, but
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there is direction of labour in the interests of the Stale. Food is available, but production is controlled. News of the out-side world is available, but is heavily overloaded by propaganda. Criticism of the régime is allowed, but it has to be muted. Organised opposition such as we know it in Western Europe is not to be tolerated; it is an offence against the régime.
The existing conditions in Communist China may well be ideally suited to the Chinese character and they may have proved their worth. That I do not wish to dispute. What I wish to question is whether 800 million people can all be expected to conform, and if only one per cent. of the people of China wish to seek their freedom there are 8 million who are potential refugees. It is the same story of the struggle for freedom that has persisted since the dawn of history.
The New York Times said, on July 31 this year, that the number of illegal immigrants flowing to Hong Kong from mainland China is now higher than it has been for a decade. Mostly they have to swim to freedom, often in shark-infested waters, sometimes swimming from 4 to 12 hours to make their escape. They all have to take enormous risks in order to escape. One young girl who managed to swim to safety in Hong Kong had her right foot snapped off by a shark. Her three companions perished in the attempt. The majority of these refugees are young people who have been sent to rural communes from Canton and other Chinese cities as part of the general movement in China to send educated young people from the cities to the countryside.
I would be the last to decry the enormous strides made by Communist China in the fields of education, medicine, economic growth, culture, art and science. But why do these people risk their lives to escape from this economic and cultural land of progress into this backwater of colonialism which is Hong Kong? It is simply to be free, to be free to criticise, to organise and, if necessary, to denounce and to condemn. It is an irony and a tragedy of the human race that we begin to value our liberties at their true worth only when we are deprived of them. That is why Hong Kong to-day is not only a sanctuary but also a symbol, perhaps the finest symbol anywhere in the Far East, for those who wish to be free.

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Of course, there is no representative government. Of course, in Hong Kong there are no free elections. Of course, there are no flourishing trade unions in Hong Kong. But Hong Kong is fortunate in having a government, albeit a government by a colonial power, dedicated to the welfare of its people, so that they are free to concentrate on their bitter struggle for economic survival, aggravated by conditions of the fuel crisis, by intense economic competition from Taiwan and South Korea, without having recourse to the luxury of Party strife, Party bitterness and political dissensions.
What country in the world to-day—although this is possibly highly arguable—would not consider itself fortunate to be relieved of some of the corrosive influences of Party strife by the existence of an experienced benevolent government, even from outside. Of course the 4 million Chinese in Hong Kong are deprived of certain human rights, of some political powers, but many millions of those 800 million on the Communist mainland would risk their lives to enjoy these deprivations if immigration into Hong Kong were unrestricted and uncontrolled.
Of course, corruption exists in Hong Kong, but corruption is endemic everywhere in the Far East and is far worse almost everywhere else in the Far East than in Hong Kong—the Phillipines, Vietnam, Indonesia, Cambodia, Laos, Malaysia, Thailand. You have only to name the country to be aware of the existence of corruption in its midst. The Hong Kong Government has been loud in its denunciation of corruption and more active than any other country in the Far East in its efforts to suppress it.
As for opposition, the Hong Kong Government has wisely allowed full scope for Communist propaganda, Communist economic infiltration, so that both Communist and capitalist enterprise can flourish freely side by side, and the Chinese themselves can best be left to judge the merits of both systems. And still the one salient overriding fact remains; the potential flow of population is always in one direction. If we decry the low wages paid in Hong Kong, we must not overlook the fact that, certainly when I was last in Hong Kong nearly two years ago, the wages paid in Taiwan were half of those paid in Hong Kong and
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the wages paid in South Korea were half again of those paid in Taiwan. That is a measure of the bitter struggle for economic survival that now faces the 4 million Chinese political refugees from the mainland of China who today form 98 per cent. of Hong Kong's population.
That is why we ought to plead for a fair assessment of Hong Kong's position to-day, for a fair deal, for a decent, responsible British Administration wholly devoted to the interests of the Chinese community whom they are fated to govern—a community the majority of whom certainly wish for a continuance of this enlightened benevolent government that they now enjoy. Let us criticise by all means, but let us be fair in our criticism and weigh the good against the bad. Let us realise, as so many millions of Chinese realise to-day, that the good in Hong Kong far outweighs the bad, and let us also seek to encourage our own fellow-countrymen now in the Hong Kong Administration in their efforts to improve conditions in that colony in every possible direction, so that Hong Kong may become the showcase for all that is honourable and good in the British tradition.
7.29 p.m.
LORD GORE-BOOTH: My Lords, I will not follow immediately on the noble Lord, Lord Segal, except to say one thing; that is, that what he has said will, I am sure, give the greatest pleasure and encouragement to that very fine Governor, Sir Murray MacLehose, who was transferred from the Diplomatic Service and has exercised his position with conspicuous success. May I start by apologising to the Minister who will wind up the debate that I shall unhappily not be here to hear him do so, as I have unfortunately, an engagement contracted a very long time ago.
It is a very special pleasure for me to be present at the debate at which my old friend and colleague the noble Lord, Lord Greenhill of Harrow, made his maiden speech. His speech was quite remarkable for its compactness, the amount that he managed to pack in to very few minutes, and also by the skill with which he gave to his speech a certain sharpness of edge which was extremely useful to all of us without going beyond what would be considered proper in a maiden speech, I certainly hope that his

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voice will continue to be heard, and often. May I, before I leave the subject of the noble Lord, Lord Greenhill, and as one who has nothing to do with the BBC, go on record as confirming his intervention in the speech of the noble Lord, Lord Wigg. I am a considerable listener and watcher, and I am convinced that the reason why the noble Lord, Lord Wigg, may have felt that he was overwhelmed by pro-Common Market propaganda is that at last to some extent the people who are in favour of our remaining in the Common Market have once again found their voices.
The debate, like many debates when there are so many things to discuss, has been a little diffuse and untidy, and I am afraid that I shall do nothing to improve this. It has seemed to me that when difficult problems all over the world impinge on us, the only thing that one can do is to select a few of them and talk about them. All the same, I think we should recognise that we are having this debate at a difficult stage in world history. If at some moments in the debate we feel a little dissatisfied with what we are saying and doing, I am sure, as one noble Lord has said, that it is that we have a certain feeling of frustration that we, as a country, can do so little about it. This is particularly frustrating for those of us who have been through times when we could do a great deal about it. None the less, there are things that we can do, and in particular if we manage in the months and years to come to get our own affairs into somewhat better order than they are at present.
I propose to deal shortly with three subjects: subjects that are not really related to each other but which directly concern actions by ourselves. The first is to say something on the Common Market; then I should like to follow on what the noble Lord, Lord Greenhill, had to say about détente, with a short analysis of the propaganda side of what goes on underneath super power détente. Thirdly, I should like to say a word which would combine the South African item with what I would call a critique of trendy diplomacy. On the Common Market, it seemed to me that it was the right moment to enunciate certain principles, but not, as the noble Lord, Lord O'Hagan, rightly said, to enter into details. I have tried to formulate three principles governing
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our attitude on staying in or coming out of the Common Market which may perhaps be useful for further reference, quite apart from whether they say anything to your Lordships at the moment.
The first principle—and I feel that it is important that somebody should say this officially and with all gravity—is that despite what certain very important persons may have said in recent weeks, the EEC is not a shambles. I have been there twice this year, once less than three weeks ago. You may say that the building is rather large; you may say that there are too many people in it, which they would dispute; you can certainly say that there is too much paper; but what one has to admit, if one takes any serious interest in what is going on, is that the personnel are of very high quality; that the work is extremely seriously carried out; that there have been major accomplishments, whether it be in agreeing on a programme of international lending and borrowing. All these things amount to some very serious work, and it simply is no good suggesting that we can sail in and put the shambles right. That is not the score at all.
If I may be slightly less serious for one moment, when the word "shambles" was used some conscientious Frenchman looked it up in a dictionary and translated it as it appeared in the dictionary as "abattoir", which means a slaughter house. This had to be put straight, but when they got it straight they exchanged from "slaughter house" to phrases like "tomber en ruines", which means "falling apart", so may I plead that Ministers take care of their vocabulary about the Common Market, whatever may be their immediate sentiments, because what they say is listened to on the Continent and runs the hazard of translation.
LORD O'HAGAN: My Lords, I wonder whether the noble Lord will agree that it is far easier to insult the staff of the Commission, who are about a third of the size of our Ministry of Agriculture, than to deal with the real absence of political will in the Council of Ministers, which, if anything, is the cause of the EEC occasionally becoming something approximating to a shambles.
LORD GORE-BOOTH: My Lords, I certainly think that the indecision of Ministers as to where the organisation

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is going is a contributory factor, but I felt that the noble Lord, Lord Greenhill, was perhaps asking a little much of Ministers in asking them to define where they were going. I think I would agree with him that they should have long sessions at the summit, but I think one is having to compromise in the Community between the Latin a priori outlook and the Nordic pragmatic outlook, and one can go perhaps two or three steps at a time but not too certainly, especially as all the Heads of Government have always to look over their shoulders to their constituents. I agree that there is the impression of indecision, but it still is quite wrong to use the word "shambles".
My second principle would be that it is possible to deal with the Common Market from two positions; within, and without. We have had experience of both. If you deal with the Common Market from within, then at once you achieve friends and allies in a particular argument. They will not be the same friends and allies in each argument, but there will always be a division within, and there will also be a propensity to help. If you leave the Common Market, and start to argue again from without, you will start by finding that the drawbridge is up and the portcullis is down, that the members are closeted inside working out an agreed line. You will then be courteously invited in, and you will find it immensely difficult to break the common front. There is absolutely no question that there is only one conceivable way to deal with people who will undoubtedly be doing anything from 30 to 50 per cent. of our trade with us in the future, and that is to be one of them. That is pure, economic sense.
My third principle is that there should be no nostalgias: no nostalgias about things that were, and no nostalgias, if there can be such things, about things that were not. I do not go so far as that brilliant man, Mr. Louis Heren, who constantly tells us that the special relationship with the United States is dead. It is not dead, but it is a very much smaller item in the United States thinking than it obviously was thirty years ago, or even twenty years ago. The one way to make it a little smaller still would be to pull out of the Common Market.
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Secondly, the Commonwealth is an important political association, multiracial, on the whole relaxed within itself although always subject to the motto, if you will, "fragile, handle with care", but there is no prospect whatever of going back to a sort of latterday Ottowa Agreement situation. All round the world Commonwealth countries have either had to make provision for themselves or have chosen to do so—Canada inevitably with the United States, Australia with Japan, India with the Soviet Union and so on; therefore there is no prospect of restoring even the limited economic unity that existed before and the Commonwealth countries would not now wish that to happen. So those are two nostalgias of something that was, up to a point, but will not be found if it is looked for again in the future. The other is the nostalgia for an industrial free trade area. The answer to that one is that there was not an international free trade area. Some have painful memories of how that attempt came sadly and rather angrily to an end. That again is not something that we can re-establish for the simple reason that when it came to an end it was clear that our efforts offered us so much more than it offered the Community that the project simply could not be realised.
So there are three factors—that this is a going concern, that we would be very much worse off economically in dealing with Europe without it than within it and that there is nowhere else to go in a world of regional groupings—that make it for me decisive that we must do the best we can in renegotiation; and I congratulate Ministers who have achieved as much as they have so far and I am sure will achieve more. We must go on to reap the gains which surely await us as members and also the influence we shall have on the future of Europe by being there. If we are outside we shall have none.
On the referendum, I note that the gracious Speech does not precisely say that but it does not seem to contain many options. I felt that the noble Lord, Lord Wigg, was quite unfair in discussing the matter with the noble Lord, Lord O'Hagan. The point surely is that there are some subjects which lend themselves naturally to a referendum, like divorce in Italy or the employment of foreign

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labour in Switzerland. They are straight, easily understood questions and it is no insult to the ordinary member of the British public to suggest that perhaps Parliament is the right way to decide on something so complicated as the implications of joining the Common Market and of staying there. None the less it looks as though the public will be consulted directly and all that one can say there is that it will be incumbent upon all of us who believe in this as our future to make ourselves heard and read as much as we can in the months to come. The latest signs, as one noble Lord said, seem a little more favourable, and possibly as education goes on so will understanding increase as to why so many of us support what has been our policy for so long.
My Lords, may I change gear completely and turn to an examination of the reality of Marxism-Leninism in this world because it affects both what we do externally and what we believe and say. I hope your Lordships will bear with me for a moment if I indulge in a little of what might almost be called dialectics. It is an interesting and sometimes embarrassing fact that the British as a people are not much given to ideological thinking—perhaps we are happier without it—but it is worth remembering that it took us in Parliament five years of Hitler to acquire any understanding at all of what Nazism was to be like. Moreover, if one is critical of Marxism or Marxism-Leninism in this country one is apt to be criticised. This is the great political crime of the late Senator Joseph McCarthy who, apart from the personal pain he inflicted on so many people by his unfair accusations, succeeded in making criticism of Communism not done or not respected.
I have studied this matter a little, and in order to explain what I am about to say I have invented in another context something which I have christened "the cliche secretariat". It is no good looking for "the cliche secretariat" in the Post Office directory or in the telephone book or probably in a basement in Moscow. It is a kind of bush telegraph, an emanation from like-minded people who when there is criticism of Marxism set up a kind of buzz communicating itself from one person to another until everybody believes it. If one criticises Marxism-Leninism the cliche secre-
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taria turns itself on and says "reds under the bed, reds under the bed "until everybody turns to everybody else and says "Yes, reds under the bed". I notice that the noble Lord the Leader of the House said it the other day, although I will give him credit for not saying it with great conviction. Equally, if, for instance, the Americans do a little successful counter-espionage and there is a certain amount of public debate about it the cliche secretariat turns on and say, "CIA, CIA" until again we all begin to believe that everything that is wicked is done by the CIA. The same happens with international companies.
In case your Lordships think I am just having an amusing word game with myself let me bring this up to date and take your Lordships to the breeding ground for this kind of situation. In September the Federal German Foreign Minister and the East German Foreign Minister met with the purpose of improving understanding. The East German Minister's response to this was to say, "The fate of the German nation's future has been decided by destiny", which could mean a little, or not very much, or a great deal. Then he went on to say, "The difference is that Federal Germany is capitalist and East Germany is Socialist"—a very convenient and easily learned tag containing two false suggestions. The first false suggestion is that Germany is capitalist. It is more capitalist than this country, but it still is a mixed economy with a great deal of State operation and a very rapidly growing trade union power in German industry. The second suggestio-falsi is that if Germany is Socialist—and what surprises me is that social democrats do not immediately protest at this—all socialism is in fact Communist. This is something one finds particularly in Asia. People buy the idea of socialist countries and I wonder that social democrats do not protest more loudly. To continue the story, Mr. Brezhnev went to East Germany and made a speech. He said, "The conflict of systems is between socialism" on which my comment stands, "and bourgeoise democracy". That again was a very carefully planned phrase, easy to remember, and it suggests that all democracy is bourgeoise and that is its purpose.
I do not go further than that. This is not intended to be a denunciatory speech

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of anybody, but I do beg people who are social democrats to beware of this kind of way in which the Marxist-Leninist thesis is propagated by apparently innocent words devised for a specific purpose. I do this because I happen to have read some of Solzhenitsyn's Gulag Archipelago and on about pages 30 to 50 your Lordships will find a description how under the leadership of Lenin every single variant of policy from middle Left to social revolutionary Left was utterly destroyed.
I leave that to draw its own moral, but it is an aspect of the method which will go on—it must go on, because Marxism-Leninism is a religion—under the perfectly genuine super-State détente in terms of arms at the top. In other words, it means that to an important degree détente is wanted by the Soviet Union but not at the expense of a continuing pushing of Marxism-Leninism around the world. It is not wholly irrelevant to present events—since we are all waiting in some suspense to see how Marxism-Leninism will fare—in Portugal, in Italy, where there is considerable political instability, and also in Greece. Of course I do not need to explain the problems for N.A.T.O. which will be involved in significant Marxism-Leninism advances in even one of those countries.
I come to South Africa and what I might call the dangers of trendy diplomacy. I start not with a protest but with wholesale applause for what the Government did in the United Nations about South Africa's continued membership of that Organisation. I wish to compliment the Government for very special reasons; not that this was expedient, because it was not; not that this was imposed on the Government, because they could well have ducked out and let the Americans use the veto; but because an important double principle was involved.
The first principle was that if there had been any yielding on this point, one would then have gone into an era in which there was a danger each year of the Assembly voting who was the most unpopular member and relegating that member to limbo. The next member to go, as The Times editorial perceptively suggested, might have been Israel. So we have maintained, at least, that there cannot be an emotional majority vote
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which, simply by acquiescence of the great Powers, would permit such expulsion. I am sure that the Government were absolutely right to do it for that reason. Moreover, if one looks at the Charter carefully, one will find that in the preamble there is a statement that:
"The peoples of the United Nations are determined to promote social progress and better standards of life in larger freedom."
Article IV lays down conditions for new members coming in, which is that they must be able and willing to carry out the obligations of the Charter. If one went through the membership and strictly abided by that standard, then it would most regrettably fall off sharply. It is better that everybody should be there, vices and all, than that there should start to be discriminatory expulsion.
I come now to the subject of Simons-town. Here I feel somewhat more sympathy for the Government than has perhaps been seen in the average of speeches to-day. I believe this is a difficult problem for them. It is more than extreme opposition which this agreement encounters. Also, I have some fellow-feeling for people who doubt whether you can protect British shipping in those waters by methods which would have been appropriate in the two World Wars which we have experienced. On the other hand, I feel strongly that if you look at the map and study the distance between Ascension Island and Australia, you then see that to have some foothold at the southern tip of Africa, anyway for pre-hostility and general observation purposes, is very valuable indeed.
If I might venture a word of advice to the Government on this question, which I do with great humility, it would be that they might be wise to get it lost for a while, to discuss it with the United States, France and other Governments and work towards something—of course, I am not able to say how the constitutions will make it possible—which will diminish our obligations to South Africa, but which will retain the facilities which we really need. I think that that would be the right solution to aim at, but it would mean the Government fending off a good deal of attack on a subject on which they would be accused of being dilatory. But I think that they might, in the end, get the best of both worlds.

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Earlier I alluded to "trendy diplomacy". What I hope the Government will try to avoid doing in their second innings is making some of those righteous and irritable gestures which affect nothing. To tell the British Ambassador in South Africa not to give tea to the Lions was complete nonsense, even in the light of a perfectly legitimate expression of opinion that the Lions should not have gone there. I sincerely hope that had I been the Ambassador I would have devised a way of evading this instruction. Equally, there was no sense in prohibiting the Ambassador in Chile from at least being represented at the anniversary parade, because the job there is not to show either pleasure or pain, but to look entirely impassive and get a good idea of what is going on. That is what a diplomat is for.
I mention these trivial, trendy things because all these situations, particularly in Chile and Greece, cloak one of the most difficult problems we will have to face in the years to come when democracy is at stake. That is the question to what extent it is legitimate to use democratic institutions to damage democracy. That, although little admitted, is what the late President Allende did. I hope some message of this kind might be conveyed to Mr. Andreas Papandreou, whose part in provoking the coup of the Colonels should not be underestimated. I do not mean that he did it on purpose, but there are ways of producing situations in a democratic society which bring on dictatorship with a horrible inevitability. These are matters which we shall have to be thinking about in the years to come.
My Lords, I am conscious of having made a "fractionated" speech, if there is such a word, and I apologise for being to that extent discourteous. I hope that your Lordships will allow me one final diversion. Several noble Lords have said they felt justified in breaking away from the main subject of the debate in order to make some general comment on whatever it might be, notably the position of this country. I think we can all agree that this country is not at the moment displaying its best form. If I may read, being briefly anecdotal, it is better to bring out my moral by quoting rather than by pontificating.
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In a recent, "If You've Got Problems" programme, a citizen who had been disadvantaged by a change in the law found himself in a position where he was reliant in an important matter upon somebody else who had given his word to do something. When he appealed to that man the answer was, "No. I am now protected by the law and do not see why I should do what I said I would do." In this country we have made marvellous progress in helping the unfortunate, the disadvantaged, the sick. Collectively we have come a long way. I was not surprised when the liberal lady who summed up the programme said:
"I am afraid I must advise you that this used to be a country where a person's word was his bond. Now I cannot give you that assurance."
I wonder whether as a country, in making the advances we have, we have slipped back somewhat in the personal trust and reliability between individuals.
I could be right, I could be wrong, but I should like to finish my remarks by suggesting that we look at ourselves a little in our relationships between individual and individual, producer and customer, worker and consumer, to see whether, in our general thinking, we are really thinking also of the person next door to us. I think we shall have a few shocks but I believe that, if we have them, then perhaps in the future we shall go back on to the upward curve to which we so much need to return.
8.0 p.m.
LORD SELSDON: My Lords, in ten years in your Lordships' House this is the first speech I have made from the Benches of Opposition. It is not a job that I relish very much, but I think it gives me for the first time in your Lordships' House a chance to be slightly less diplomatic than usual, and perhaps to have some minor "go" at noble Lords opposite, because quite honestly I do not really know where I am. I have no idea from the gracious Speech exactly in which direction our foreign policy will lead us, or our policy on defence, as my noble friend Lord Carrington has said; but there is one simple thought in my own mind that I should like to put across.
For many years now this country has lived in an age of self-deception, and very suddenly, in the past nine months, we have seen the basic quality of our

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life and the fabric of our structures beginning to be destroyed. We are faced with the fact that, as an island or as a nation, we cannot survive without international influence, international co-operation and international activity. We therefore must perforce be outward-looking, and we must, perhaps above all else, give greater emphasis to defence and foreign affairs than the bulk of people in this country would have us do. It is fair to recognise that those who have never known the horror of war do not appreciate the value of peace; nor do they understand expenditure upon defence. It is true, too, that those who do not travel or do not work in the international world do not know the value of international relations. Whatever we do, we know we cannot do it from a position of weakness. As my noble friend Lord Carrington said, we are faced first of all with the economic situation.
My Lords, despite the feelings that there may be in this country that we can survive, there could be nothing more savage than what has happened in the last six months to British industry. No Government, however diabolical they may have been, however much they may have plotted or planned, could have taken away so much from so many people in such a short space of time; and, with that, has gone the basic confidence of British industry, and to a large extent the basic confidence of the individual. There is thought and worry that we may not survive at all; and in my travels abroad now I have found people who, for the first time, are ceasing to be proud of being British. I even catch myself on odd occasions passing myself off as some form of foreigner. It is not that one does not believe that there is some future for this nation, but that it is (we must face it) a fact that we are in an economic mess. There is a way out. It will be by investment, by expansion, by aid from abroad—all of these; but at the moment we are faced with a position of uncertainty, and uncertainty creates further uncertainty.
I now move to the international field, and in particular to the effects of British entry or membership of the EEC. We have been exhorting our industry at home to invest in England, and they, wise as it turns out that they have been, have
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been investing abroad. Those companies which did not listen to the Government, but instead set out and invested abroad to earn profits abroad and to expand overseas markets, are those who will survive these hard times. It is those whose statements by their company chairmen read: "We cannot foresee what is going to happen at home, but we are confident of the continuing success of your company in its overseas markets". Equally, in my commercial job I am faced with the continual problem of encouraging people to set up and expand over here, and I have been faced in the last nine months with innumerable companies who would like to come to England. They are not worried about the cost of coming to set up over here. They are, it is true, worried about labour situations; but they are more worried about the instability and uncertainty of continued British membership. Why should they invest and set up a plant in England when there is even a remote chance that in weeks or months they may be the wrong side of a tariff barrier? Why, too, when they doubt that we have political stability, or that it is even safe for their children to go about in the streets, should they encourage themselves or their colleagues to come to this country rather than to others?
The economic position is, as we know, serious, but it is becoming more and more serious abroad as people begin to realise that we are in a mess—and yet we are not in a mess. I go abroad to the Continent about three days a week, and I was in Paris quite recently with a large French company. They said at a dinner which we attended:
"If only we had what you in England have—nuclear power and technology greater than all the reservoir of the rest of Europe put together! Coal, which we need badly; and the prospect of oil. If we had that in our country and did not have your people or your attitude to life, we would be the most powerful country in the Western World within a decade".
I am continually fed up with the problems that one has of needing to defend ourselves and our attitude abroad. We are faced, as we know, with a weak economic position, and yet despite that the Germans are appalled that they, with their economic strength, cannot influence the rest of the world to the same extent as we can, with our economic weakness.

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Part of this, obviously, is our Defence power; and even if that is slashed a little, there is one last advantage that we can cling to which might be described as good will—good will built up over generations, over centuries. It is true to say that the British are probably the least disliked nation in the world, and even from economic weakness we have managed, through the strength of our Foreign Office and old-established links, to be able to exert some form of pressure or influence in all quarters of the world. I am concerned, and I think others are, that this influence should continue to be exerted. It is not simply with the basic commodities. We have seen the oil problem, we will see the mineral problem and we shall probably see the food problem. We cannot survive without any of these three elements; and yet they may become a greater bargaining power than exports or diplomacy.
However, my Lords, when we return to something nearer home, I do not know whether noble Lords opposite are aware of the damage that has been done by this uncertainty over E.E.C. membership. I would not in any way wish to be rude, but I think one could liken their policy on renegotiation to the activities of a certain mythical bird, the oozlam-oozlam bird, which learnt to fly backwards in ever-decreasing circles until it ended up somewhere unmentionable and then performed an unmentionable act upon the assembled multitude from a great height. Renegotiation and negotiation are, as we know, the same; but what they have done is to create in the eyes and minds of many people abroad the belief that the British no longer stand by their word—and we know that your Lordships' House was totally behind the E.E.C., more committed than any other single body in the history of this country.
We are faced now with the difficulties of how the Government can get out of the awful mess they have got themselves into. There are many of us on both sides of this House and in another place who believed some while ago that one should take the EEC out of Party politics; that a democratic decision was made by an elected Government, and that matters should be left as they are and we should not go on creating this uncertainty. When noble Lords are faced or the Government are faced with the
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problem of deciding what they do, do they hold a referendum or an election, or do they invent some new form of instrument, classified under "the usual channels", for communicating with the British people? I would say to them that if I were allowed to phrase a referendum I believe one could get the answer "Yes" or the answer "No" depending upon how it was done, as has been proved time and time again.
If an Election were called it would be difficult for the Government to do so without first stating their case. I think all of us on this side of the House feel that in general the Government support continued membership of the EEC; but let them not wait too long before coming out with their commitment to it. Let them take, if they like, the glory for renegotiation. We on this side do not feel too strongly about it, because I think that all of us know where we stand. But let them start trying to negotiate from within rather than from without, and let them remember that there are a lot of hairs that are bristling on people's necks over what has happened over this matter.
Many people are living in a world of uncertainty, and that uncertainty extends not just throughout the EEC but also to other quarters of the world, and even as far as mainland China. There are people there who see a great future for this country as a member of the EEC and also as a point of entry for their products, their services, their goods and their own influence to Europe. There are others who believe in and support the old idea that if they can destroy Britain they can destroy Europe; and if there are such people seeking to destroy Britain, many of us would feel that they are doing a reasonably good job at the moment.
The EEC is one factor only. Looking, as one can, into other parts of the world which I will not cover in the ten or twelve minutes for which I shall have been speaking, it must suffice to say that, in my travels in the Middle East—and I shall be going there more and more often—I have found considerable support for the British. In many of those countries—countries which we feel are so preoccupied with war—there are sound and sensible men who recognise that they have only a short time to live with the

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oil benefit. They are, as we know, concerned about food. There are the plans to turn the Sudan into the granary of the Middle East. There are considerable demands for British goods, services, technology and know-how—and we have this technology and know-how which could be exploited. We have, too, a mass of people who, because of the economic climate here, are thinking of leaving their homeland, which is something we should do what we can to discourage.
We are faced with what one might call economic sadness. I have never felt less optimistic in my life, yet I can still feel a tinge of optimism when I sit at a conference table abroad and see that the British still seem to be head and shoulders above other countries. I am concerned that if some of the policies which we believe the Government may push forward to-day destroy or in some way shake the confidence of the British in themselves, that destruction of confidence will have wide reverberations throughout the world, so that not only will the British cease to have confidence in themselves, but other countries will cease to have confidence in us. This, my Lords, is my main concern. I do not speak with a total feeling of gloom because I am fortunate enough to be cushioned in my travels from some of the depression that one sees at home, and I know that there are still countries and organisations which believe that we have an economic future. There are those who would support us in coal, in the North Sea and in the exploitation of our technology. There are always those who have an affection for us, but I do not believe that we can survive for ever on good will and affection alone.
8.14 p.m.
LORD ANNER: My Lords, I hope the noble Lord will forgive me for not following him, but it is late and I want to speak about one subject in particular, and in the circumstances I shall try to restrict myself to that one subject. The noble Lord, Lord Wigg, in his final remarks in a very long speech, made his usual attack upon Israel and of course misrepresented the whole position. I have just returned from a short visit to Israel—and, incidently, a nation with which we have a favourable trade balance, which may be of interest to the noble
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Lord, Lord Selsdon—a nation which has always had great confidence in Britain and one which has realised that Britain produced the Balfour Declaration, the effects of which some people are trying altogether to destroy. It is upon that that I wish to speak.
My Lords, once again I saw Israel carrying on a highly civilised daily life. It is a democracy which seeks to develop facilities for its citizens, Jew and Arab alike, and, in spite of the vicious threats and actions of its enemies, proceeds with these activities, thus continuing to build up a land fit for human beings to live in. Anyone who visits that land will undoubtedly agree with me that that is the position in the land itself. It is free from the corruption which contaminates political and social life in many other States and it maintains a judiciary which I feel, like our own, is an example to the world. I believe that practically everybody who visits that land will not be surprised, therefore, that Israel is astonished that some international bodies are prepared to allow themselves to act against her in a manner so immoral as to allow the representative of cold-blooded murderers and assassins to participate in deliberations in the General Assembly of the United Nations.
My Lords, I went to Ma'alot and there saw the room in which 21 children were slaughtered by members of one of the constituent bodies of the Palestine Liberation Organisation. The assassins, who came from their lairs in the Lebanon, where they continue to cover themselves by hiding behind women and children in refugee camps, commenced their horrific plot by mowing down three defenceless persons standing on their door-steps. They proceeded at 2 o'clock in the morning with their weapons to a school in which some 100 children were sleeping; they terrified them with guns and other weapons and held them until 5 o'clock in the afternoon—that is, from 2 o'clock in the morning until 5 o'clock in the afternoon—when they committed the ultimate barbaric act I have referred to. The other children, mercifully, were saved by the Israelis but, in the meanwhile, some 11 or 12 terrified youngsters had jumped from a window 15 feet from the ground.
The noble Lord, Lord Wigg, always refers to actions condemned by ourselves

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—and I myself have time and again condemned in another place the actions to which he referred—but this is the action of a body which had set out to slaughter children as part of its plan. Those children were there on a holiday. They had come from Safed, a village in which Jews have been living for thousands of years and adjoining which there is to-day an artists colony, part of Israel's cultural activities. Ma'alot itself is a place which indicates what the Israelis are trying to do. Their fight is not, and never has been, a fight directed against neighbours; it is a fight against the ravages of nature which have eroded the land, which erosion has continued for centuries. That is their fight—it is a fight to establish and continue to establish a centre in the Middle East where civilisation can be carried on on a proper democratic basis. In Ma'alot itself, incidentally, they are to-day digging the rocks from the soil in order to build homes, in order to provide arable land on which to grow food, much of which will be exported and which, if only the Arabs realise it, could help the Arab world as much as it can help Israel itself. The terrorist attack to which I have referred was one part of the action planned by terrorists who belong either directly to or come under the roof of the Palestine Liberation Organisation.
The butchery that went on at Kiryat Shemona and other places, the numerous other murderous crimes committed under the wing of the Palestine Liberation Organisation, such as shooting down defenceless passengers at Lodd, the assassination of an American diplomat and the Munich murders, have shown clearly that the Palestine Liberation Organisation will stop at nothing to gain its own ends. To think that a leader of that organisation of murderers should be allowed to address the Assembly is beyond my understanding and, I believe, that of any reasonable person. I greatly regret that our own representative at the United Nations abstained from a vote on such an issue instead of voting against it. I sincerely trust that we shall take steps to see to it that we make it quite clear that we do not approve of that kind of organisation being represented in any way at the deliberations either of the United Nations or of any of its Agencies.
Why do I say that? Since the founding of the United Nations in 1945, so far
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as I have been able to ascertain, only one man who did not represent a member State has addressed the General Assembly. That man was Pope Paul VI, the spiritual leader of the Roman Catholic Church and the head of a sovereign State, Vatican City. The second will be Yassar Arafat, chief of the terrorist gang, Al Fatah, father of the Black September Movement and head of the Palestine Liberation Organisation. The decline in the moral authority of the United Nations must be measured by the invitation extended to him to speak from the same United Nations rostrum that was graced by His Holiness. The American Ambassador to United Nations, John Scali, took a stand for humanity and decency and against the cynical acceptance of murder as the common currency of international politics. Why did not we? Where were America's allies? It is America with whom we want to make a closer relationship for the benefit of the Western World.
The best that Britain, Belgium, Canada, Denmark, the Netherlands and West Germany could do was to abstain. France, Ireland and Italy supported the terrorists. The effect of their vote, in my opinion, was to give legitimacy and an international platform to the murderers of international airline passengers in Athens and those who committed similar acts. The United Nations resolution describes the Palestine Organisation as "the representative of the Palestine people". Where did they get that from? Where are the Palestinians?—60 per cent. are in Jordan; 10 per cent. are in Israel living very decent lives. Why is the representation of those people to be regarded as being in the hands of that organisation? Has there ever been an election by Palestinians to this end?
The fact of the matter is that the terrorists themselves have so far managed to deceive the world, or at least the greater part of it. The idea that they can represent decent civilised Arabs is certainly not one which can be accepted by anyone who knows the facts. What do they want to do? How can you possibly invite to the deliberations of the United Nations an organisation which has stated categorically that the destruction of the State of Israel must take place? It is late in the evening otherwise I could quote dozens of statements made by Arafat himself to this effect, some as recently as a few months ago. How on earth can people who

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represent that kind of view be accepted in deliberations of the United Nations in which Israel is recognised as being a sovereign State, created by the United Nations, and indeed one of the finest jewels in the United Nation's crown?
I want to appeal to my right honourable friend along the following lines: let us, for heaven's sake, try to get the people who really can and should settle matters in direct talks and produce peace in the Middle East together, instead of introducing an element which is determined not only to destroy any possibility of peace in the Middle East but to destroy it for their own people as well as for the rest of the world. As I said a few moments ago, I could give very many examples to support the argument I am putting forward, but I do not want to delay the House any further at this late hour. My hope is that the deliberations which have commenced between Egypt and Israel, between Syria and Israel and extended to talks between Jordan and Israel will be resumed. That would mean the continuance of the Jordanian State, which really represents the vast majority of the Palestinians. Unless that happens, it is impossible for Israel itself—and I am sure anybody would understand this—to come to a table and sit with people who absolutely deny its right to exist. If a Palestinian State were put up in Gaza and the Western Bank, will that put an end to it so far as the Palestine Liberation Organisation is concerned? Will they not spread their terrorism into Jordan and will they not continue to do what they possibly can to destroy the State of Israel? I do not think anyone can deny that such is their plan, and I hope we shall have the good sense to frustrate it and bring real peace to the Middle East.
8.29 p.m.
THE EARL OF LYTTON: My Lords, the noble Lord, Lord Janner, has raised in detail a matter I have not heard dealt with by many others. I should like presently to follow up what he has just said to us all, and I hope he will be kind enough to remain until I do so, because I have a very few points to make by way of introduction.
I should like to join in congratulating the noble Lord, Lord Shinwell, whose speech I read with enthusiasm, though
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I did not hear it. He mentioned the social contract, and of course it is the foundation stone of everything that is going to develop advantageously from the gracious Speech. I have had great difficulty in obtaining it: the Printed Paper Office had not heard of it; the Library did not know about it. I want to ask whether I have at last got hold of the document. It is labelled Economic Policy and the Cost of Living, and was produced in February 1973. I wonder whether this really is the social contract because I have nothing else to go on. I do not rely on the interpretations of these things I read in the newspapers. I read with some astonishment the devastating criticism of this document of the noble and learned Lord, Lord Hailsham of Saint Marylebone, and it may be that everything he said was true. But I am sorry that nothing was said in its favour because in a very difficult situation it seems to be groping after a concept of justice. I do not know whether that is its main theme because I have not studied it sufficiently; and while I still do not know whether I have the right document, I should like to have it because I subscribe to this ideal of justice.
Justice of course has many departments, one being theological. If we legislate against the Ten Commandments, for example in violation of the Commandment, "Thou shalt not kill", we are in for a lot of trouble. There is political justice: it has been my sorrow to be engaged in controversy. When I first came to this House to arrange for political justice in accordance with the wishes of certain peoples, these views were not taken and a painful "war" of four years ensued. I have enumerated eight such "wars" since the last "war", in all of which cases one can say that a more obviously prudent arrangement, in accordance with the wishes of the people, would probably have avoided it altogether. So we have some responsibility. There is then social justice, which is more or less a matter of dignity. I was much impressed by the tremendous enthusiasm all over Africa, all over the Third World, when the greatest sporting event of the year, perhaps the most distinguished sporting event in my time, was held, when Mohammed Ali went to the heart of Africa, and two splendid athletes fought it out and conveyed to Africans that they could manage a great event of

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world significance, something important, for the first time. Dignity counts for a lot.
Then there is economic justice. I should have liked to speak a lot about that because there is not much difference between a low paid worker in this country, such as my shepherd, and myself. His daughters go to school, free; two of them have thirteen and eleven O levels between them, three A levels apiece, a degree apiece at London University after winning a scholarship— all free. They have a small car and a cottage. But when I was appointed in my youth as a ruler, in the name of His Majesty in Africa, I ruled over a district about one-fifth the size of England which I managed on foot. It was part of an area which was twice the size of England. I suppose my subjects were 30,000 in number. None of them ate properly. They wore few clothes, only token skins. They had no houses; they had no furniture; they could not read or write. There was not a doctor, a dentist or a surgeon. There was not a shop; they had no tools of any kind. They did not till the soil and neither did they spin. It was a way of life. Possibly the Green Paper on the wealth tax would have classified them as having some wealth, whereas it would classify my shepherd on Exmoor as having none. Which of these people is the deprived?
Although it was fifty years ago when I exercised the responsibility which I have never had since, the people changed very little. I went to look one day. Because I had said, "Thou shalt not kill", they said, "Provided you stop other people killing us we will co-operate". The cattle were stabbed with injections to cure pleural pneumonia and other epidemics. Forty years later they had destroyed their environment, it did not resemble anything. One interferes' at peril in these matters. We owe a lot to the people of the Third World; and some people in this country who regard themselves as deprived are not remotely deprived compared with billions and billions of people. Unless our balance of payments is restored to respectability, we can do nothing for these people except by borrowing from the Shah. That is a dreadful thing to which this great country has come at the moment. But we shall get out of it, I am sure.
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On the other hand, we have a duty to try and encourage détente and reduce wars, especially among those such as I am talking about. I am thinking that one of the best ways of détente before us may well be that the international community has agreed that the Olympic Games for 1980 will be held in Moscow. There was great delight in the pages of Pravda. They regard it as justice following upon all the gold medals that the Russians win at Olympic Games all over the world. They are going to lay themselves out; they appear to have promised to open the doors and to have undertaken a lavish and extensive construction. I hope that we shall take part with enthusiasm and because they have an "iron curtain", because they discriminate against certain people, because they have no Parliamentary system, and will not think it a discredit to our moral stature—an expression used in the debate to-day. I feel ostracism is not the way to treat the publican who commits sins that you do not like. You dine with him if he asks you to, and you make friends.
Regarding the festering sore in the Middle East, on the subject of which the noble Lord, Lord Janner, has spoken eloquently, feelingly and understandably, I feel I have a duty to put a different point of view in some respects, difficult though it is. I am slightly associated with the foundation of the States, remotely so in that Balfour was an uncle of mine, and we were enthusiastic for a Jewish State in Palestine. I visited there in 1932 and I had a shock. I was shown round by the best possible person, the chief publicity agent of the Jewish organisation—a man called Josiah Gordon. I saw everything that was to be seen and I was very alarmed, not because I ceased to enjoy the fact that the Jews could find a home of their own, but because the pledges seemed so likely to clash and to be incompatible. I had luncheon with the Governor and he said, "Both sides denounce my policies with equal intransigence and vehemence". I said: "Perhaps that is a sign of your impartial justice." He looked at me and said: "No. I wish it were." The Royal Commission of 1937 indicated a possible solution of the irreconcilable problem. So it has gone on to this day, more than fifty years of an insoluble problem.

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The noble Lord, Lord Janner, now mentions that the international community—without I think one dissenting voice; I am not sure—has decided that the representative of the Rump of Palestine will speak. The Presidents—
LORD JANNER: My Lords, I am sorry to interrupt but it is not so. America were against and several other countries were against. Our country abstained, as did some of the other countries I mentioned while I was speaking.
THE EARL OF LYTTON: My Lords, I hope I am right in saying that the substantial majority were in favour of their being heard.
My information on the next point is derived from a broadcast from Cairo 15 minutes after midnight on the day of the Queen's Speech, monitored by the BBC, and happily translated into a language that I understand. That indicated that the Presidents and Kings of the Arab States, meeting at Rabat, had decided that the Rump of Palestine should not be managed by Jordan—that is to say, when it is recovered from Israel. It is called the West Bank, that is the larger part of it, the Old City of Jerusalem. That is a unanimous Arab decision for the first time, and the King of Jordan made a last ditch attempt to stop it, but failed. My Lords, a solution must come. There is a solution for everything. I look to something of this kind as a solution—in other words, an independent rump of the former Palestine under Palestinian management. That is what I look to as the solution which is developing as a consensus of the international community.
I could not agree more with the noble Lord, Lord Janner, in what he said about the danger of these terrorists, but I myself have been through all that. Some of my brother officers were murdered on the first "bloody Sunday" in Ireland, ten or eleven of them in front of their wives. A gentleman called Michael Collins was alleged to be responsible for that particular atrocity. In 1922, I think it was, Lord Fitzalan handed over the keys of Dublin Castle to this same man for whom I had been looking, hoping that I would win £10,000, which was the sum of money placed on his head at the time. Others of my brother officers were concerned with the Mau Mau affair, and Jomo Kenyatta
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was sentenced for managing it. It was a very horrible and brutal thing and I read every detail of the atrocities performed. But Mr. Kenyatta has long been a respected, and one of the most intelligent and able and authoritarian successors to the Imperial rule in the country I used to know so well. Again and again we have dealt with people of this kind whose hands are dripping with blood from the most horrifying things. When I was a youth I thought, "Have I served in vain that this dreadful man Michael Collins should be handed over the keys like this?" We were worked up. We hated the "Shillers", as we called them, far more than we hated the Bosch. That is what happened. It was the first lesson in life, and I do not know that one can escape it.
I agree with the noble Lord, Lord Janner, that this is a very serious problem and that every kind of international support will have to be given. But I myself think that an independent rump of Palestine is possibly the only solution that is emerging after fifty years of unending trouble. I do not entirely subscribe to the view expressed by the noble Lord, Lord Wigg, that we must capitulate on this because the sheikhs and the Shah are holding a pistol at our heads in the matter of oil. I think in the end we must recognise that the dispossessed Palestinians have suffered an injustice, an injustice comparable in its way to the immense and prolonged injustices that the Jews have suffered in Europe. It is a pity that Europe was not made to pay the penalty for all that it inflicted upon the Jews.
LORD JANNER: My Lords, before the noble Earl sits down may I ask whether he is really suggesting that Israel should be destroyed and that a different government should be set up, and that only those Jews who have been there since 1917 should be allowed to remain? What is to happen, if the noble Earl would be good enough to answer this, to the 750,000 Jews who are in Israel to-day having come from Arab countries?
THE EARL OF LYTTON: My Lords, I am not quite sure what it is that is worrying the noble Lord, but I will explain positively what I mean by the "Rump of Palestine". There is an area which, when the first Jewish war occurred, was invaded by Jordan and the

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executive officer was Glubb Pasha, a Briton. The Arab Legion took over that area and for part of the time it has been referred to as the West Bank and the Old City of Jerusalem. That is the area that is being talked about, the principal area. I myself do not think the international community is thinking of abolishing Palestine. Has it not again and again referred to the boundaries of 1967, as though a boundary of sorts has already been accepted and approved by the international community? No, it is not going back on that. That is my view. All I am saying is that there is an area which has been poached rather irregularly by Jordan with British troops, and, rather than go back to Jordan, I see a solution, if it is acceptable—I repeat, if it is acceptable; it may never be accepted. It is a solution that the Palestinians themselves should have a home. It is all very well for the Arabs to talk about "the Arab State". Palestinians are one group of people and the people of Rabat are a totally different crowd, and there are different aspects of their language every fifty miles you go.
8.48 p.m.
VISCOUNT LONG: My Lords, at this late hour I will not take too much of your Lordships' time. If I might have just two minutes, that is all I want. The reason why I am taking part in this important debate to-day is that where I live, in Wiltshire, I am in the centre of one of the biggest Ministry of Defence areas in the West Country, if not the whole country. To the North, South, East and West of where I live, we have the Royal Air Force at Lyneham (so many of your Lordships will have flown out from there on different errands); we have one of the few ships that has never seen water, HMS "Royal Arthur"; we come round to the School of Infantry which is one of the most important training establishments for infantry—and the Americans have never seen anything so efficient—and we then come right round to the commands at Wilton, all the Army commands, on to Boscombe Down, the scientific research station for the Royal Air Force, and the other camps at Bulford.
During my visits of one kind or another for the Royal British Legion, I meet many serving men and officers who are either off to a campaign, such as
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Northern Ireland, or to do an important errand in dropping supplies of wheat, or whatever it is, to another nation in trouble. May I say that when my noble friend Lord Carrington was Minister of Defence I never saw greater morale throughout the Forces than he inspired in them. It is very important that the Government should realise that one of the most important things in defence is morale and, while having to acknowledge the difficulties of cost of defence, and the rumours that fly about in one way and another that the Government are to cut down the Ministry of Defence—whether it be the Royal Marines, the Parachute Regiment and others—one hopes that the Government will try to inspire and keep going the inspiration and morale of our Services.
It is vitally important that those 15,000 men in Northern Ireland should continue to keep law and order there, but they can do it only if they see leadership coming from the Government and I hope that the Government will see this. There is no substitute for morale; there cannot be. While all the problems continue over the cost of defence, let us hope that the Government will be able to keep this morale going in the officers and men, who are the people who run the defences, whether it be radar or otherwise. I hope that the Government will be able to retain that morale, because once it starts to slip we shall not get new recruits to defend our islands. My Lords, may I leave you with the word "morale" on that point of defence, because so much else has been said.
My second point is that in this country we have always been acknowledged as a trusted friend of other countries, whoever and whatever they are. Whenever we have made a treaty we have always abided by it, come what may. What I fear more than anything at the moment is that if the Government insist upon scrapping the Simonstown Agreement—although it is only a rumour at the moment, as I understand it—and are not happy with the Common Market Treaty, we shall be in peril of isolating ourselves as a country, which, if we are not very careful, will give us more problems than anything else, such as trade. We shall isolate ourselves from our friends. Who will trust us in money dealings? Who will trust us in trade?

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Therefore, I ask the Government to be very careful about how they allow the words "treaties" and "friendships" to be bandied around, because if we lose our friends, whoever they are and whatever they are, we shall find it extraordinarily difficult to get our trade through; or, in an emergency like that in Pakistan, where we have to send over our Royal Air Force Hercules fleet with wheat, we shall find that we do not have flying space. They will not allow us to go. Therefore treaties must be kept, and in this respect I ask the Government not to allow rumours to fly about that they are worthless paper things. The public in this country must feel it all-important that the Government respect treaties, and they must feel that the Government will abide by them at all times. My Lords, that is all I have to say to-night as the hour is late.
8.55 p.m.
LORD LLOYD OF KILGERRAN: My Lords, may I add my congratulations to those of others of your Lordships to the noble Lord, Lord Greenhill, on his brilliant maiden speech, and may I also say how much we hope that the noble Lord, with his great experience in these matters, will be heard frequently in the debates in this House. I am also sure that your Lordships will feel indebted, as I do, to the noble and learned Lord who sits on the Woolsack, for the statesmanlike way in which he introduced this excellent debate and for the tone which he set for it. However, I am conscious that at this late hour your Lordships will be addressed by two other speakers of great eminence in world affairs, the noble Baroness, Lady Tweedsmuir of Belhelvie, and the noble Lord, Lord Goronwy-Roberts.
Therefore, if I may, encouraged by the brevity of the previous speaker, the noble Viscount, Lord Long, whom I do not propose to follow in his interesting pursuit through the military scene in Wiltshire, I will try briefly to stick to some of the salient points that have been expressed in the gracious Speech. I hope I shall be able to do this succinctly and uncontroversially, and I propose to pass over a number of points fairly quickly. Then, encouraged as I am by the noble and learned Lord who sits on the Woolsack, who said that economic and defence
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policies are of such great importance, I propose to make a few observations and suggestions which it may be possible for the reviewing committee of the Government on Defence matters to consider, particularly in regard to reducing the costs of the European defence system.
My Lords, first of all, may I say that we on these Benches support the efforts being made to make a lasting peace in the Middle East. As so many of your Lordships have said, the world's major political and economic difficulties to-day seem to stem from the failure to find a settlement in the Middle East. May I also express on behalf of my colleagues a warm tribute to Dr. Kissinger's tireless efforts to make permanent the present fragile peace. In connection with the reference to Cyprus, I was greatly moved by the speech of the noble Lord, Lord Bethell, on this matter. I should like to pay a tribute to the United Nations Force in their dangerous and continued tasks of peace keeping.
In so far as the gracious Speech referred to the Commonwealth, we on these Benches support the expressions made of support for the Commonwealth Association, and we feel sure that the meeting of the Heads of Government of the Commonwealth in Jamaica next year will show to the world the value of friendly co-operation between free and independent nations. So far as NATO is concerned, it is now a commonplace to say that so much depends upon the United States and the Atlantic Alliance for defence. We note that the gracious Speech—and, indeed, the noble and learned Lord who initiated this debate also mentioned it—echoes the words of Dr. Joseph Luns who is Director-General of NATO. Speaking in April of this year, he said that NATO is now achieving the dual aim of providing a shield and also promoting détente.
We wish success to the negotiations for force reductions in Central Europe and to the Conference on Security and Co-operation. There are obvious advantages in having continuing dialogues with all nations seeking agreements of substance which, as is hoped, are not merely a collection of meaningless words. For my part, may I say, as somewhat an outsider in regard to defence and foreign affairs, and not having the great experience of the noble Lord, Lord Greenhill, that I

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am unable wholly to agree with his despondency at the progress of détente during these last few years.
My Lords, after making these general observations, I turn to consider what is the most significant part of the gracious Speech regarding European defence and the question of its cost. If I may quote the gracious Speech it says this:
"In consultation with their allies and in the light of a searching review of our defence commitments and forces they will ensure the maintenance of a modern and effective defence system while reducing its cost as a proportion of our natural resources".
I pause to emphasise that the gracious Speech refers to consultation between allies. There is no mention of who the allies are or of the procedure which will be adopted in order to continue these discussions. These decisions will be made
"in the light of a searching review of our defence commitments and forces".
Then your Lordships will note that there is a reference to the basic question of the cost of defence in relation to the resources of this country—a point which was emphasised by the noble and learned Lord who initiated this debate. The searching review may not be available until early next year, so we understand, but I presume to suggest that some of the suggestions I am about to make may be of interest in regard to reducing costs.
There is one aspect related to the cost of European defence which is at present under careful consideration; that is, the urgent matter of replacing obsolescent equipment. The noble Lord, Lord Carrington, presented a report on major equipment plans in December, 1971, known as the "Europackage", when he was, I believe, chairman of the so-called Euro-group. Other reports have been issued by that group and the significance of some of those reports has not attracted the attention that perhaps they should have done. However, in the light of the increasing economic crises in Europe, the manner and the cost of the replacement of major equipment for European defence requirements requires urgent attention.
May I direct your Lordships' attention to the question of military aircraft? There is the question of the replacement of the United States F.104, which is used in the air forces of the Netherlands, Belgium, Denmark and Norway. Then there is the question of the desirability of adopt-
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ing the French Mirage aircraft—for many interesting reasons. Next there is the question of further replacement of United States aircraft. This question of aircraft replacement clearly involves major economic and political repercussions. On October 28 last, Signor Spinelli, who is the E.E.C. Commissioner for Technical Affairs, is reported as having urged that Western European countries should immediately replace 350 ageing military aircraft by European made machines.
How far this is a matter which affected the United Kingdom Government's policy in regard to their proposal to nationalise the aircraft industry, and what is likely to be the attitude of the United States Government—who, no doubt, may continue to expect United States equipment to be purchased in order to offset the cost of United States' troops in Europe—may be the subject of further information to this House by the Government on another occasion. But if the Government, and indeed Europe, are to be able to reduce European defence costs, much more active support must be given immediately to, first, measures for the effective working of a procurement agency for military weapons; and secondly, and above all, measures to achieve far greater standardisation of military equipment for use in European defence.
The danger and increased costs arising from the lack of standardisation within NATO was the subject of a very forceful statement by the Secretary-General, Dr. Joseph Luns, in London only a few days ago, on October 25 last. He is reported in The Times on October 26 as having said that the lack of standardisation was a nightmare to its military commanders. Those are very strong words indeed. He gave as an example that the Alliance had more than 130 different types of military aircraft, including 30 different types operated by Britain. He went on to say, as reported:
"If NATO forces are to operate together efficiently and support each other in a crisis, they need a certain level of standardisation of arms and equipment. This could reduce the cost of development, acquisition and maintenance of equipment."
I fully realise that a great deal of discussion about the standardisation of arms, the consequent reduction in cost and the value for strategic purposes has taken place in relation to the defence of Europe. For example, this has happened in NATO,

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but I suggest that as France is no longer a member of NATO many of these discussions have not been very effective. Again, so far as the Eurogroup is concerned, France at the present time does not appear to wish to take a full part in the Eurogroup; and, once again, France seems to some extent to be outside the scope of these discussions.
My noble friend Lord Gladwyn has told your Lordships that the E.E.C. Defence Committee is becoming more and more virile, but in view of the present state of the E.E.C. I venture to suggest that the E.E.C. Defence Committee cannot hope to be effective for many years in regard to European defence. There is, however, one institution—namely Western European Union—which is still the only European organisation with responsibilities in the field of defence policy, and which has an active secretariat and an assembly for open discussion. Therefore, it seems to me that it would not be unhelpful for the Government in their pending review seriously to consider the use of, at least, the Western European Union framework in regard to the urgent problem of the standardisation of arms, particularly as the W.E.U. is an active assembly for parliamentary discussion.
I have the honour to be a member of the United Kingdom delegation to that assembly. There is a strong view expressed from many parts of Europe at the present time that this assembly could be used to give fresh impetus to Europe. Indeed, there are many reports before the General Affairs Committee urging that Western European Union, modified or strengthened, should be used for standardisation purposes. The noble Earl, Lord Avon, suggested this to your Lordships' House last April, and I presumed to support his view in my address to your Lordships on April 3. In taking any course which attempted to co-ordinate the institutions dealing with defence matters, it would not mean setting aside NATO, the E.E.C., the Eurogroup approach, or any other approach to these questions, particularly the vital question of reduction of costs by standardisation.
Therefore, I venture to suggest to the Government that if it is to achieve, as the gracious Speech states,
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"… the maintenance of a modern and effective defence system while reducing its cost …"
in consultation with its allies, Western Europe could be helped to get out of its present political and economic crisis by the use of the framework of W.E.U., modified or strengthened. Such a modified framework, with its active assembly for parliamentarian discussion, could be capable of acting as an attractive force towards European defence unity.
My Lords, I hope that your Lordships will not consider that I have been too technical in the 14 minutes in which I have had the privilege of addressing you. But we are concerned with technological matters of the highest significance. Standardisation, production and distribution of military weapons are increasingly vital elements for the survival of the European defence system in the present political and economic climate of Europe. But in my view, progress in this direction can only be achieved in the near future through some form of institutional procedure in which our main allies, particularly France, Germany and the United States, can play a real part.
9.10 p.m.
BARONESS TWEEDSMUIR OF BEL-HELVIE: My Lords, I should like to join in the congratulations given to the noble Lord, Lord Greenhill of Harrow, on his maiden speech. I had a very happy two years with him in the Foreign Office, and had a chance at first hand to see his wisdom, and his steadiness when things got rough—which they often do in the Foreign and Commonwealth Office. I feel that he and the right honourable Member Sir Alec Douglas-Home were indeed a formidable combination. We hope to hear from him often.
I think all noble Lords will agree that this debate has been of great interest, and that it has also been very necessary in view of the widespread rumours of large cuts in defence and, indeed, talk of specific cuts in defence. The fact that we have a Statement on defence which will not be given until later this month, and that the detailed Defence Paper will not be ready until next year has placed the House in considerable difficulty. Under these circumstances, it has therefore been necessary for your Lordships

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to express very real anxieties, and to ask searching questions. I hope that all the speeches made will be given most careful consideration before final decisions are taken on what are vital matters to the security of this nation.
This is the moment, at the start of a new Parliament, when one may usually hope the best of a Government, but this Parliament and Government are really a continuation of the last. Therefore, it is not surprising if there have been many expressions of concern and, indeed, of doubt. My right honourable friend the former Secretary of State for Defence told us of his deep anxieties about the effects of the Government's declared intention to make large cuts in defence expenditure and even the soothing words (if I may call them that) of the noble and learned Lord who sits on the Woolsack and the excellent sentiments expressed did not make me feel very easy, because in the same speech he told us that the Government intend to make defence cuts of several thousands of millions of pounds.
THE LORD CHANCELLOR: Several hundred million pounds.
BARONESS TWEEDSMUIR OF BELHELVIE: I stand corrected: like Winston Churchill once said, "What does an extra nought here or there really matter?". The repercussions on foreign policy could, of course, be very serious. For example, I should like to find out a little more about what is meant by the phrase in the gracious Speech which tells us that the Government, and I quote:
"will regard NATO as an instrument of détente as well as defence".
It can of course be so used, if the West and the Free World were to conciliate only from positions of relative strength. Surely to reduce armaments first in the belief that this will lower tension will be considered by the Communist world as weakness and we will be open to all kinds of political pressures. Surely any disarmament should come only after we have tried to ensure that we can achieve a mutual and balanced reduction. The noble Lord, Lord Bourne, spoke again of the ratio of troops and conventional weapons between the Free World and the Warsaw Pact, which I always understood was about 2½: 1 in favour of the Warsaw Pact. Therefore, to alter the balance of forces on our own would surely be highly
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dangerous and might well call in question as well the nuclear deterrent. Therefore, the very real fear that I feel bound to express is that those in the Cabinet who want reductions of arms will win support, regardless of the effect on foreign policy. In that event the Foreign Secretary will be unable to ensure that Britain is a strong and reliable ally.
Of course, the cost of defence is very heavy, and particularly at this time of grave economic difficulty. Indeed my noble friend made some reductions during his term of office, the most he could do to ensure that we still carried out our obligations. And that is why one is forced to question whether it is intended to cut our obligations. For example, the gracious Speech refers to trying to reduce the cost as a proportion of our national resources, and of course if one examines NATO, from figures given by the Mnistry of Defence, it is perfectly true, for example, that in 1973 the United Kingdom spent about 6 per cent., France 4·2 per cent. and West Germany 3·9 per cent. But as a basis of comparison, that overlooks the fact that in cash terms France spends as much as Britain and West Germany considerably more. Therefore the difference in terms of percentage of gross national product is accounted for by the size of the respective national economies.
Even if one saw reductions in defence spending of the lowest order I have seen quoted, of about £250 million a year, that would have to mean cuts in manpower and it would mean damage to our NATO contribution. Well, my Lords, as the noble Lord, Lord Lloyd of Kilgerran, told us, NATO has been our shield for 25 years and it has been buttressed by North American and European combined strength, and, above all, by the political consensus among allies that is our best guarantee for peace. Any damage to our NATO contribution would make it very hard indeed to persuade our allies to keep up their own defence efforts and it would also undermine the will of the United States Congress to keep American forces in Europe at even present levels.
So when we consider how we can remain a reliable ally, I think we should also consider our attitudes to other aspects of our defence policy and our security needs in other parts of the world,

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such as, for example, the Simonstown base referred to by many noble Lords. The steady increase in Soviet naval forces in the Indian Ocean has taken place before the re-opening of the Suez Canal. The vast rearmament taking place in the Middle East countries makes a peace settlement even more difficult to secure than it has been in the last few months. Whatever happens, security of passage of our ships through the Canal certainly can never be taken for granted. In any case, with the size of oil tankers now, they have to go round the Cape as indeed do many vital supplies for both ourselves and our allies.
One is therefore driven to suspect that if the Simonstown Agreement were really brought to an end it would not merely be because our security needs were satisfied but because we would be unable to use the South African facilities because of cuts in our naval capacity. For surely if we did depart from Simonstown it could not be be because of our attitude to apartheid, which is deplored by ail Parties in Parliament. After all, African Governments trade with South Africa, and recently Zambia welcomed an apparent change in South African attitudes. I am quite sure that the Government were right and courageous to use their veto at the United Nations to prevent the expulsion of South Africa. We have always believed that it is wiser to give opportunities to closed societies to be exposed to other nations' ideas.
This has always been the strongest argument put forward by those who oppose sanctions in Rhodesia. When we had the responsibility of government we continued the sanctions policy, for reasons which I have often given your Lordships, and, of course, Rhodesia was in rebellion against the Crown. But I should like to ask the Government a question that they always asked me—and this is such a wonderful opportunity to be able to do it. I was always asked regularly whether the Government were taking any new initiatives. Therefore, I will ask them that question now, against the background of fast moving events in Mozambique and Angola and possibly South-West Africa. I think that although there is to be a debate on the Order next week, your Lordships would welcome a Statement on the Government's attitude
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on the Rhodesian problem in advance of the debate, and, above all, their conclusions on the review of policy towards Africa, which I understand has been under study for some months.
On the wider question of Britain's ability to influence events in foreign affairs, I always remember that Sir Alec Douglas-Home once said this:
"Physical security requires a strong economic base. Prosperity and lasting peace require a positive act of will by people of like mind who are prepared to co-operate to ensure it."
To ensure that strong economic base, we joined the European Community, yet for eight months past, and up to twelve months ahead, our future in Europe hangs in the balance. I am sure that it is in our interests, and in the interests of our partners, that renegotiation should be brought swiftly to a conclusion. Here I thoroughly support the view put by the noble Lord, Lord O'Hagan, for the longer we delay, the less our influence in European affairs. Indeed, it is President Giscard d'Estaing and Herr Schmidt who have emerged as the leaders of European development.
It may well be, as was said by the noble Lord, Lord Gladwyn, that the coming economic crisis—and indeed the crisis which is already with us in a great many respects—may have the result of forcing the Europeans to work together very much quicker than they thought they might have to do. It seems that in the review of the Common Agricultural Policy, of the regional industrial policy, and of trade and aid, changes are being sought in the normal way within the E.E.C. institutions in a certain welcome continuity of policy. For example, it was Mr. Godber who proposed, when he was Minister of Agriculture, six ways whereby the cost of C.A.P. could be contained, consumer prices better held, and surpluses controlled. The European Commission then produced ideas for a radical reform of C.A.P. which would save £400 million a year by 1977, and, as the present Minister of Agriculture said in June:
"Everything I have mentioned could, and in many instances would, be due to come before the Council at some stage in the ordinary course of business."
So therefore both Governments, Labour and Conservative, have worked to the same end in practical spirit of national unity.

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It is a welcome fact that while reform of the C.A.P. is under discussion, in the Community many foodstuffs are below the world price, and not least in the recent deal on sugar. As the Foreign Secretary himself said in June of the C.A.P.:
"It can provide an assurance of supplies at known prices in a world where both prices and availability can be unpredictable."
Then of course there are the various matters which have brought great benefit to this country. There is the Social Fund of £24 million; aid to steelworkers, £9 million; there is the European Investment Bank where the United Kingdom received loans worth £32·5 million at 8½ per cent. Interest ; and one sees the practical results. Some of this is being used to make a new power station in Peterhead in Aberdeenshire, from where I come. So it is right that we should think of the benefits as well.
What about the Community budget? Although our contribution to the budget was less than expected last year, forecasts by the Treasury and the Commission of trends for 1980 calculate that we shall pay a higher share of the Community budget in relation to our gross domestic product. These calculations are, however, based on the gloomy forecast that Britain will have much the lowest growth rate of the Nine: between 2·5 and 3·5 per cent., against an average of 4 per cent. to 4·5 per cent. in the Nine. As this forecast takes us to 1978, one assumes that it is based on the normal span of the present Parliament. Of the policies that will produce so low a rate of growth, your Lordships have given your judgment and conclusions during this debate on the Address. However, the Community exists to find solutions to problems, otherwise strains are placed on all its members. But if adjustments are to be made to help us, then our partners will need to be assured that we will remain a wholehearted member.
Some of your Lordships have referred in this debate to the sentence in the gracious Speech which tells us that:
"Within twelve months the British people will be given the opportunity to decide whether "
to retain membership. Many of your Lordships believe that a referendum reduces the authority of Parliament; a view I share. If the Government decide to bring forward legislation to authorise and hold a referendum, they may regard the
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result as binding upon them, but of course it will not be binding upon Parliament. I have heard it said that there are various ways in which a Government might advise the electorate. But assuming that the Foreign Secretary is successful within the Community—which of course those of us who believe in the Common Market very much hope that he will be—his partners will then expect him to urge the Cabinet to approve the terms and recommend the British people to accept them.
It is surely then inconceivable that the Prime Minister would do other than insist on the normal convention of Cabinet collective responsibility—as indeed he did last week over the three members of his Government who criticised the joint British South African naval exercises. If, my Lords, members of the Cabinet hold to their personal beliefs, it seems inevitable that there will be Ministerial resignations. I feel that the Government have made immense problems for themselves over a referendum. Which is why perhaps we shall see the decision subsumed in a General Election at a time when the economic crisis may be only too clear for all to feel. Indeed only yesterday the Minister of State at the Foreign Office told us, "The important date is October, 1975, when the British people will decide how they see the future of this country". We shall have to wait until we hear whether it is to be a referendum or a General Election. Comments like that make us very interested indeed.
So long as we are a member of the Community, whether we believe we should remain or whether we believe that we should withdraw, let us try to make it work. That, surely, must be a British interest. Whether it be by the Government's work to achieve an agreed approach to international monetary problems, to define our policies on energy, or aid to developing countries, I think we should back the Government to devise ways whereby the European Community and the United States can know each other's thinking at an early stage, can define the differences and try to propose agreed solutions. I hope we do not underestimate the influence we can bring to events if we are a reliable ally. With our knowledge of the Commonwealth and experience drawn from all over the world we have ideas, talents, and the

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capacity to work if we will. Above all, I think that despite our troubles we still really have faith in what we are and of what we yet can be.
9.28 p.m.
THE PARLIAMENTARY UNDERSECRETARY OF STATE, FOREIGNAND COMMONWEALTH OFFICE (LORD GORONWY-ROBERTS): My Lords, this has indeed been a wide-ranging and very valuable debate. It was impressively opened by my noble and learned friend who occupies the Woolsack. He was followed by the noble Lord, Lord Carrington, in a speech of characteristic cogency and the noble Baroness who has made a graceful speech in reply to a gracious Speech. It is always a pleasure to listen to her. At the outset of her remarks she expressed the hope that what has been said in this wide-ranging debate will be carefully studied by Her Majesty's Government, particularly by my right honourable friend the Foreign and Commonwealth Secretary, and I can certainly give that assurance.
I turn now to the group of questions raised on the matter of defence. The noble Lord,. Lord Carrington, rightly stressed the importance of the Government taking full account in the Defence Review of the possible effect of defence economies on the security of this country, on the commitments of the United States to the defence of Europe—a point I was particularly glad to hear stressed by him—of the equipment and morale of the Armed Forces to which the noble Viscount, Lord Long, also made reference and on the defence industries and the numbers of people they employ.
The noble Lord, Lord Lloyd of Kilgerran, and the noble Lord, Lord Gladwyn, stressed the importance of collaboration in the research, development and production of arms for the defence of Europe. I shall address myself to the point raised by those noble Lords later on. I mention now the other considerations rightly presented by the noble Lord, Lord Carrington, because I wish to assure the House that all these considerations have been, are being and will be taken into account by the Government in reaching their conclusions on the Defence Review. This Review is the most thorough undertaken for some years. It has entailed analysis in depth of the
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whole size and shape of our defence policy for the next ten years. It is an extremely complicated and difficult exercise. Naturally, conclusions on it are correspondingly difficult. The House will judge the Review on the facts when they are made known to it. Meanwhile, individual noble Lords should not believe all they may read in their newspapers.
The noble Lord, Lord Carrington, asked me a series of questions about consultation with our allies. These will indeed be real consultations. Her Majesty's Government have repeatedly made it clear during the course of the Review that our allies would be consulted wherever their interests were affected. Until those consultations have taken place, final Defence Review decisions clearly cannot be made public or communicated to Parliament. But Parliament will, of course, be kept informed to the maximum extent possible of the progress of the Review. Our conclusions will be placed before Parliament in due course.
LORD CARRINGTON: My Lords, may I interrupt for one moment? Does that mean that our allies will be told of the Government's proposals for saving several hundred million pounds a year, but that Parliament will not be told until the Government have decided what they are going to do after consultation with our allies?
LORD GORONWY-ROBERTS: My Lords, of course decisions must be preceded by consultation. We shall be consulting our allies fully on the proposals and the suggestions we shall put forward. It is clearly impracticable to air those proposals in public while we are discussing them in preferential confidentiality with our allies. I suggest it is the normal and reasonable course to follow to engage in those discussions in full confidentiality before placing them before Parliament to let Parliament decide if they are acceptable.
The noble Lord, Lord Carrington, mentioned "several hundred million pounds a year." We shall see the extent to which it is practicable, using the criteria that he has quoted to-night, how far it will be possible to save money meaningfully and with due regard to the security of this country and our faithfulness to our obligations. The noble Lord

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himself, and the Government of which he was such an ornament, saved £300 million. I am sure that he did not do so without taking into full consideration all the aspects of the matter mentioned.
LORD CARRINGTON: My Lords, if the noble Lord and the noble Baroness, whom I heard saying "Hear, hear" earlier on are saying I was wrong as Secretary of Defence to save a large sum of money on defence, how much more do they have to justify saving any more in the future?
LORD GORONWY-ROBERTS: My Lords, nobody said that the noble Lord or his Government were wrong in doing this. Indeed, before I was interrupted I was endeavouring to pay something like a compliment to the fact that he went about this job of saving £300 million, having regard to the proper security of the country and our obligations to our allies. We hope to emulate him in our approach to this task, if not possibly in the extent to which we shall achieve savings.
Now the defence Standardisation—a very important point raised by the noble Lords, Lord Lloyd and Lord Gladwyn—is of course fully supported by this Government. I note what the noble Lord, Lord Lloyd, has said about the possible modification of WEU for certain purposes, but our view is that NATO is the proper body through Which this matter should be discussed and implemented. Indeed, we very strongly support the cooperative efforts that are being made in the Eurogroup—a body which my right honourable friend the Chancellor of the Exchequer set up in 1968, and whose efforts to achieve rationalisation and standardisation were, I am glad to say, promoted further by the Government of which the noble Lord was a member. Since Eurogroup began it has attempted with some success to bring together all European members of the Alliance to identify specifically European problems of Alliance defence and to produce technical solutions to them. It has in fact achieved much useful if somewhat unspectacular work in the field of equipment collaboration, training and logistics, and in other specialised fields. But I am quite sure that the very valuable suggestions which the noble Lord put forward in his speech will be studied by Her Majesty's Government, and indeed
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by the appropriate bodies which are already endeavouring to put these ideas into practice.
LORD GLADWYN: My Lords, if the noble Lord will allow me to interrupt him, is it not a sad and unfortunate fact that France is not a member of the Eurogroup, and that you cannot get very far without the participation of France?
LORD GORONWY-ROBERTS: My Lords, we have managed to get fairly far in certain directions, including this one, without the presence of France. It is not always possible to have a French presence in various fields. We deeply regret the absence of France from a number of European arrangements, but we always hope to have their very valuable assistance as they see that their interests are better served by being present. Beyond that I could not go.
Now may I address myself for the moment to the Simonstown Agreement? A number of noble Lords, among them the noble Earl, Lord Glasgow, and the noble Lord, Lord Bourne, and indeed others, have mentioned the Agreement; and I think the noble Lord, Lord Carrington, suggested that the Government might be overlooking our security and defence interests in reaching a decision on its future. I should like to quote from the speech made by my right honourable friend the Foreign Secretary in Cardiff some ten days ago. He said—and I quote:
"Clearly, if it is an important British security interest to maintain the Simonstown Agreement, then we must do so".
He went on to say:
"If we are maintaining an agreement that is politically damaging but only militarily marginally useful, then there is no equality of benefits in the Simonstown Agreement and it should be brought to an end or allowed to wither on the vine".
I think this is reasonably close to what the noble Lord has said and to what other noble Lords have said; that is to say, that the Simonstown Agreement, like every other matter included in this very far-reaching Defence Review, is being considered from every aspect—from the aspect of security; from the aspect of consultation with our allies, of others who are interested in it; and also from the aspect of the impact of the Agreement and our attachment to it on the situation in Africa, a continent which is poised between possible solution and possible

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chaos. Now these are matters for very careful, balancing thought; and I must repeat that this somewhat prolonged, necessarily detailed, examination has been so because these matters are of great importance.
Certain noble Lords also suggested that there is no distinction between trade with countries and military association with them. I believe that words like "humbug" were tossed about the Chamber from time to time. I wonder whether they would seek to apply this doctrine to the Soviet Union and the countries of Eastern Europe? We trade with them all, but we have no military alliance with any of them.
LORD CARRINGTON: My Lords, I wish we had.
LORD GORONWY-ROBERTS: My Lords, we have no military alliance with the Soviet Union—
LORD CARRINGTON: My Lords, I wish we were in a position to have a military alliance with countries of the Communist bloc. It surely is precisely because we are not that we have NATO.
LORD GORONWY-ROBERTS: My Lords, I do not think that that disposes of the point that I was making—namely, that if it is humbug to trade with South Africa and not to have a military agreement with her, why is it not humbug to trade with the Soviet Union and not to have a military agreement with her?
THE EARL OF GLASGOW: My Lords, this is the most awful humbug I have ever heard. Can we not, as a great nation, stand on our own feet and say what we need for our defence requirements, without inviting General Amin or some other black dictator to tell us how we ought to conduct our affairs?
LORD GORONWY-ROBERTS: My Lords, I do not think that the worthy General is telling us to do anything, and even if he were his would not be the principal voice to which we should listen.
I pass now to what has been described as an outstanding maiden speech. On this, at least, the whole House will be unanimous. The noble Lord, Lord Greenhill of Harrow, spoke of Rhodesia. He has, of course, had enormous experience in all fields of foreign policy, and I
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think that we should do well to note carefully what he has to say, particularly about a very difficult question like the future of Rhodesia. He mentioned the possibility of putting the negotiations on an all-Party basis and of including financial provision to permit white Rhodesians to withdraw in good time and order, if a new arrangement were created as a result of which this commended itself to some of them. It is a thoughtful and challenging suggestion and I am quite sure that my right honourable friend and his colleagues will wish to examine it very carefully.
The noble Baroness, Lady Tweedsmuir, asked if Her Majesty's Government had in mind a fresh initiative on Rhodesia. We shall of course be discussing Rhodesia next Tuesday and I hope, with the agreement of the House, to intervene in that discussion. In the meantime, I note the noble Baroness's suggestion and if there is any question of an initiative we should wish to facilitate this in both Houses as much as possible. I do not know that there is, but if there is we should wish to consider the noble Baroness's suggestion as to how to put it forward.
My Lords, may I speak briefly on the European Economic Community—briefly, because it is on Thursday of this week that the House will be considering the Report of the noble Lord, Lord Diamond, on the work of the Scrutiny Committee. I have no doubt that the House will not confine itself purely to the procedural purport of the Motion which we shall be considering on that day. As the noble Lord, Lord O'Hagan said, we shall have not only that opportunity but others at early and fairly frequent intervals to discuss European Community matters in this House.
For this reason, perhaps, we have not had a discussion in depth on Community matters to-night, although my noble and learned friend who sits upon the Woolsack spoke at some length about the stage we have reached on renegotiation. I therefore will not follow those who mentioned Community matters at any great length to-night. Nevertheless I have listened with the closest attention to a number of points made by noble Lords about this matter, and in particular about the time-scale within which the people

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will be consulted. This is a point related to the need, as many noble Lords said, for an early decision as to our relationship with Europe and the future of our membership.
I think the point is well taken. We have indicated through the Minister of State for Foreign Affairs in another place last week, for instance, that within the coming 12 months—though not necessarily in October of next year—we shall be consulting the people as to their wishes in this matter. I note that one or two interesting points have been made to-night about the methods of consultation which might be used, such as the referendum. One is tempted to quote the late Lord Balfour on the question of referenda. We may perhaps have an enlarged opportunity for doing this somewhat later. His views might, I think, commend themselves to Members on the other side of the House, as he was a former Conservative Prime Minister and a very distinguished Foreign Secretary of this country.
I now turn to the Middle East. I am sure I do not need to re-emphasise to your Lordships the importance which we and the rest of the industrialised world must place on developments in this area. We hope soon to see the opening of a new stage in the long-drawn-out efforts to reach a lasting settlement between Israel and the Arab States, though the difficulties remain formidable. My right honourable friend has made clear in another place on more than one occasion his view that there are a number of essential elements in any settlement, based of course on Resolution 242, to the terms of which all sections of the House subscribe. I will not read through them, because they were in fact quoted tonight by my noble friend Lord Wigg.
It is essential that Israel should have the abiding satisfaction of recognition by her neighbours of her permanence as a State and of her legitimate security requirements. It is equally essential that her Arab neighbours should be substantially satisfied on the question of territory; and I was glad to hear the noble Lord, Lord Carrington, make the point that we must, in any general settlement, satisfy the needs of the Palestinians, including the legitimate rights of the Palestinian people, as well as the individual
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rights of Palestinian refugees, nearly 1½ mllion of whom are still homeless. It must surely be the objective of Israeli and Arab, as well as ourselves, to bring to an end as soon as possible the miseries of these people and to launch in the Middle East, the cradle of so much of our highest culture, a new era of co-operation among the gifted people who live there now in antagonism but who could so well and so easily live in co-operative prosperity.
We are not, of course, ourselves immediately involved in the negotiations in the Middle East. They are quite properly in the hands of the parties immediately involved in the dispute, with the untiring and, I would say, the indispensable assistance of the United States and her Secretary of State. It would be wrong of us to set out to offer precise solutions, and it would not help the negotiations if we did so. But this does not mean our attitude towards the Middle East is passive. We are closely involved in the work of preparation for the various dialogues now proceeding, not least that between Members of the European Community and the Arab States. We hope the first meeting of the General Commission, composed of the senior officials of the parties concerned, will be convened soon.
The noble Lord, Lord Bethell, put a number of detailed questions to me about the position in Cyprus. I think I have the answers to his questions. I will address myself this evening, because time is passing and I do not want to detain the House unduly, to (shall I call them?) the constitutional matters which he raised, leaving the questions which relate to the claims, the rights of the holders of British property in the island to a more direct communication with him. I will do that with the agreement of the House. The noble Lord asked for an assurance that Her Majesty's Government would not support a bi-regional federal solution to the Cyprus problem. I do not think it would help if Her Majesty's Government were to take up positions of principle on the Cyprus problem in advance of conclusions of the negotiations between the parties themselves. The important matter is that we should find out what is acceptable to the two communities in Cyprus. Nothing can be built on a durable basis unless it is based on the feelings and desires of the two main communities in the island.

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It such a solution can be found, whether it is federal, by region or by canton, or whether it is purely unitary, we shall support it so long as it has the strong and lasting support of the people of the island itself. The noble Lord also referred to the possibility of setting a time limit through the United Nations. I share his anxiety that the wretched condition of so many Cypriots of both faiths and languages should be brought to an end as soon as possible. But we attach great importance to avoiding anything like an ultimatum, from whatever source, which might set off new tensions, new initiatives one might say, of disturbance in this troubled island. We are playing our part very fully in the discussions in the United Nations. We are in close touch with both Greek and Turk in the island and in (shall I call them?) the parent countries, Greece and Turkey, and in every way we stand ready to be of the utmost assistance in helping to promote a solution founded, I repeat, on the only possible basis, and that is the views and the feelings of the people concerned.
LORD BETHELL: My Lords, before the Minister leaves that point, could he give the House an assurance that the Government will do their utmost to see that the General Assembly Resolution, a unanimous Resolution supported by the United Kingdom, Greece and Turkey, is implemented in all its details as soon as possible?
LORD GORONWY-ROBERTS: Yes, my Lords. We strongly supported the Resolution, as the noble Lord reminds us. The great virtue is that both Greece and Turkey supported it equally strongly. We shall take every step possible in the United Nations, and through other diplomatic means, of pressing forward with the implementation of this unanimously accepted Resolution. I am sure I can give that assurance. I must warn that even the best Resolutions as passed unanimously by the Assembly are not always susceptible of implementation. In this case we shall do our best with our friends and allies, because there is nobody who opposes this very sensible and practical Resolution.
I will confine myself to a general statement on the question of détente, which was raised by the noble Lord, Lord
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Bourne, and others. I believe it was the noble Lord, Lord Bourne, who referred to the large numbers of Soviet and Eastern troops stationed in Europe. We are very conscious of the large numerical disparity between the Eastern and Western forces in Europe, and we do not claim that the negotiations on mutual and balanced force reduction in Vienna, and in the Conference on Security and Cooperation in Europe, in Geneva, have yet changed the balance of power in Europe. The important point, however, is that these negotiations are proceeding steadily in a serious and businesslike atmosphere, and that they are an important part of the process of détente. Equally important is that in our negotiations in both conferences we are not yielding to the hitherto unacceptable proposals by our colleagues in the conferences from the Eastern part of Europe. We do not accept their parameters; that is to say, exactly how reductions can be both mutual and balanced. A balance must be struck not simply by a percentage cut off the top in each case, but by an assessment of the net result of the process, so that a feeling of security as well as the fact of security is not endangered in the process.
I had hoped to say something about the question of energy. I think the noble Lord, Lord Gladwyn, and my noble friend Lord Ritchie-Calder were the two speakers who referred to this subject. I believe that I am not unfair to the noble Lord, Lord Gladwyn, when I say that he suggested that European policy on energy should be distinct from that of the United States.
LORD GLADWYN: My Lords, with respect, I did not refer to energy at all.
LORD SHEPHERD: Too difficult a subject, my Lords.
LORD GORONWY-ROBERTS: My Lords, the noble Lord, Lord Gladwyn, must forgive me. No, it is not too difficult a subject. Those who have had the dubious privilege of winding up a debate on foreign affairs will sympathise with me when I say that the plethora of notes, papers and documents which cascade on one makes it an occupational hazard to try to refer correctly to each noble Lord who has made a specific point. In any case it is a good point, is it not? There

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is a view, which I do not share, that European policy should be distinct from that of the United States—and just in case anybody thinks that, I will say this much. One of the great advantages of the International Energy Agreement is that it involves both Europe and the United States, and the large amount of oil (to give one example) which would be released through demand restraint in the United States would be available for allocation in an international emergency. Our American friends have a way of applying these voluntary restrictions very efficiently. They have done it more than once in regard to oil. By including them in the I.E.P.—the United States and Canada as well as other industrialised countries, members of O.E.C.D. though not necessarily all of them members of the Community—we see the way clear to create an emergency régime, which will be automatic when things are really threatening to the industrialised nations. This is an immense step forward and in no way conflicts with President Giscard's interesting proposal for an international discussion between producers, consumers and developing countries. It would be necessary to work out the agenda for such a conference and for any action that it may decide upon, but I would hope and, indeed, expect that the outcome of such a conference could be dovetailed into the I.E.P.—into the new agreement to which this country, I am glad to say, has acceded and will, one hopes, before May 1 next year ratify. That, incidentally, will give every opportunity for Parliament to discuss this agreement. We have now acceded to it but we still have to ratify it before May 1, and if one or two noble Lords feel that Parliament should have been consulted first, here is the opportunity for consultation before ratification.
My Lords, no speaker referred to the Far East, particularly China. I would, however, say this much about that extremely important part of the world in which we are expressing and practising a growing interest as a country. We attach, as our predecessors did, very great importance to our relations with the countries of Eastern Asia. Japan, with the third largest economy in the world, is one country with which we maintain the closest contact and to whose views on world affairs we listen with attention.
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Equally, our relations with the Peoples' Republic of China, whose membership of the United Nations we promoted for so long (both sides of the House did this over many years) are increasingly close and mutually profitable. In debates of this kind we tend, perhaps, to forget that possibly a majority of the world's population lives in Asia and possibly in Africa. It is certain that Asia to-day is developing very rapidly and is changing very rapidly and that our relations with countries in that part of the world are of great importance to us, as to them.
My Lords, I wish that I had time to go more fully into the way things are developing between us and the Far Eastern countries, but time is passing and I am reminded that I have already taken more than half an hour. My noble friend Lord Segal mentioned Hong Kong. I was very grateful for the noble Lord's remarks on that Colony, and I agree wholeheartedly with practically all of what he said. There is, of course, more to be done in this very difficult, small Colony of 4 million people who are crammed into a very small area, which in turn throws up tensions and difficulties which the present Administration—and, I would specifically add, the present Governor—are coping with with a great measure of success. We fully recognise the very real achievements already attained, but we agree with my noble friend that a good deal more needs to be done.
My Lords, I pass rapidly to the point about food which was eloquently put by my noble friend Lord Ritchie-Calder, by the noble Lord, Lord Ardwick, and, indeed, by the right reverend Prelate the Bishop of Coventry.
The World Food Conference opens in Rome today. It is held under United Nations auspices and it comes at a time when, as we all know only too well, millions of people throughout the world are experiencing acute difficulty in obtaining enough food to stay alive. It would be easy to go into this with emotion, but emotion is not enough; there must be hard thought and concrete planning and as my noble friend said, something must emerge from Rome which is immediately practicable. I am glad to say that the British delegation is being led by the Minister of Agriculture, Fisheries and Food, and the Minister for Overseas Development will also

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attend. We hope that in its two-week session the Conference will concentrate attention on practical and effective measures, not only to increase food production in developing countries in the future but to come to the rescue of those millions who imminently face actual starvation. The British delegation will make a full and constructive contribution and the Government will give full consideration to any measures which are agreed by the Conference.
I think it was my noble friend Lord Greenhill of Harrow who ended his speech with the hope that this House would work together, particularly on foreign affairs and the security of the country. I do not think anybody would do anything but echo that sentiment. As the noble Lord, Lord Carrington, said in the course of his speech, there is a wide area of agreement. We must emphasise this. From time to time on specific points there will be differences which are properly ventilated, and in a democracy like ours it is not only inevitable but necessary that this should be so. But there must be an underlying sense of national unity on the security of the country and its posture towards other countries. I believe that this debate, although it has revealed inevitable differences here and there, has also revealed a basic unity that our foreign policy must continue to be based on four pillars: the United Nations; the Commonwealth, in its new relaxed structure if I quote my noble friend Lord Gore-Booth correctly; NATO, which is more than an alliance, and perhaps with the emergence of a new arrangement in Europe, the Community. On those four pillars I think a meaningful and hopeful foreign policy can be practised by this country.
On Question, Motion agreed to nemine dissentiente: The said Address to be presented to Her Majesty by the Lords with White Staves.
CROUCH HARBOUR BILL [H.L.]
EASTBOURNE HARBOUR BILL [H.L.]
PORT OF TYNE (NORTH SHIELDS FISH HARBOUR) BILL [H.L.]
TORQUAY MARKET BILL [H.L.]
The CHAIRMAN OF COMMITTEES acquainted the House, That (pursuant to the Resolutions of October 31 last) the Bills had been deposited in the Private Bill Office, together with the declarations of the agents: Bills presented; read 1a, and pro forma passed through all their remaining stages: Bills sent to the Commons.

RIVER WEAR BARRAGE BILL [H.L.]
The CHAIRMAN OF COMMITTEES acquainted the House, That (pursuant to the Resolutions of October 31 last) the Bill had been deposited in the Private Bill Office, together with the declaration of the agent: Bill presented; read 1a, and pro forma read 2a, and reported from the Committee.
STATUTORY INSTRUMENTS
Message from the Commons that they concur in the Resolution of this House relative to delegated legislation communicated to them on Wednesday last.

COMMITTEE OF SELECTION
Second Report from the Select Committee made, and to be printed.
House adjourned at nine minutes past ten o'clock.