Sitting of 28 April 1975

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

    Price Code
    Mr. Norman Lamontasked the Secretary of State for Prices and Consumer Protection when she next intends to review the Price Code.
    The Secretary of State for Prices and Consumer Protection (Mrs. Shirley Williams): I have no plans for a general review of the stage 4 Price Code. I am consulting appropriate representative organisations on the proposals announced in the Budget Statement for amendments to two paragraphs of the code.
    Mr. Lamont: In the light of the proposed improvements in the investment relief, and given the increase in the rate
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    of inflation, surely this is merely running hard to stay in the same place and will make little practical difference. Given the time needed for investment decisions and given that the power of the legislation expires next spring, surely this will not influence anyone to take any new decisions about investment, although it will be of help to people who have already made those decisions. Surely the right hon. Lady must give some indication of the Government's intention next spring.
    Mrs. Shirley Williams: The hon. Gentleman must appreciate that it would be rather foolish for me to say a year ahead what the Government's intention can be next spring, because none of us can be sufficiently clear about the circumstances that can arise. Because investment relief is stated in percentage terms and in terms of categories, it is true that inflation is not affected, and this will bring fresh relief of the kind we want to those who are genuinely engaging in investment, growth and jobs.
    Mr. Giles Shaw: Would not the right hon. Lady agree that the Chancellor's measures added 2.75 per cent. to the price index and that as the CBI estimates that the total removal of price restraints under the code would add another 1 to½per cent. it will not be worth while?
    Mrs. Shirley Williams: I am not at all sure that I accept the CBI's estimate. It should be pointed out that the CBI's estimate of the effect if the Price Code restraints were removed would apply to

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    the prices of all sorts of goods, essential and less essential, whereas the Chancellor's measures applied above all to the less essential goods.
    Dr. Hampsonasked the Secretary of State for Prices and Consumer Protection what recent consultations she has had with the food industry with regard to the operation of the Price Code.
    Mr. Giles Shawasked the Secretary of State for Prices and Consumer Protection what progress has been made in the consultations between the Department and the food industry with regard to amendment of the Price Code.
    Mrs. Shirley Williams: Following the statement on the Budget made by my right hon. Friend the Chancellor of the Exchequer on 16th April, I have circulated to interested parties a consultative document, which is available in the Vote Office, setting out the changes I propose to make to the Price Code. Among other changes, I propose to extend investment relief to commercial vehicles. This measure will, I believe, be of particular benefit to the food manufacturers as well as to distributors. My proposals take account of recent discussions between my Department and representatives of the food manufacturing industry.
    Dr. Hampson: Is the right hon. Lady aware that the Budget did nothing of any significance or relevance and that this absurd bureaucracy is strangling the profitability of the industry? Why not take some direct measures to ease the code in its operation? Why is the Department being so rigid over the discounts which bakers are prepared to offer to wholesalers—I put a case to the right hon. Lady recently—so that a supermarket chain can reduce the price of a loaf by 2p or 3p?
    Mrs. Shirley Williams: The hon. Member is on very weak ground. In the first place, the Government introduced a specific tied investment relief because we were concerned about growth. If the hon. Gentleman's own administration had done this earlier, we might have had more growth this year. [Interruption.] All I can say is that the industry itself very much welcomed this, and it will not do for hon. Members opposite to fool about in a
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    situation in which the industry itself has pressed for investment relief of this kind.
    With regard to the point about the use of the Price Code and bureaucracy, in my view it would be irresponsible in a situation of rapid inflation not to recogise that sacrifices have to be made by all sections of the community, including industry.
    Mr. Shaw: While accepting that any relief, be it in investment on vehicles or in any other way, is acceptable in relation to the profitability of food manufacturing companies, may I ask why it is that in the last week we have seen a report from the Spillers Group indicating a loss of £7 million on the baking side of which it attributes £6 million to the restraint of the Price Code?
    Mrs. Shirley Williams: There is a very difficult technical position in respect of the baking industry. The hon. Gentleman at least will recognise that it would have been irresponsible of me as Secretary of State for Prices and Consumer Protection to allow the subsidy to be used to widen discounts so that there would be no effective control over public expenditure. Of course, it is the case that we have introduced controls over discounts for the purpose of protecting the taxpayer.
    Mrs. Sally Oppenheim: Will the right hon. Lady recognise that, given that the reliefs which she has given are welcome, they have only marginally affected the food industry, which still has special problems? Does she not accept that it is in the interests neither of consumers nor of the people employed in the industry for such companies to go bankrupt? With regard to the meeting she had in her Department and the information she has given that the Department would have new criteria in relation to the interpretation of those provisions of the Price Code that the food manufacturers were complaining about, her Department cannot do such a thing. Such an interpretation must be judicially recognisable. Will she issue orders?
    Mrs. Shirley Williams: We are very happy to discuss at any stage with the food industry any ways in which we can assist in making orders as clear as possible. I accept what the hon. Lady says. It is fair to say from the point

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    of view of the general public that there has been a fairly dramatic fall in the margins of retail food and drink prices from 2·8 per cent. in the third quarter of 1973 to 1·9 per cent. in the third quarter of 1974. It is worth pointing out to the public that there is no profiteering in the retail margins of food at the present time.

    European Community
    Mr. Rathboneasked the Secretary of State for Prices and Consumer Protection if she will list the ways in which British consumers will continue to be protected from price rises whilst the United Kingdom remains a member of the European Community.
    The Under-Secretary of State for Prices and Consumer Protection (Mr. Robert Maclennan): As members of the European Economic Community we are free to act on prices as we think best and my right hon. Friend will continue to implement the Counter-Inflation and Prices Acts in the interests of the British consumer.
    Mr. Rathbone: While I thank the Minister for that statement, I wonder whether he can give the House an idea of what little effect our membership of the European Community has had directly on prices generally in this country.
    Mr. Maclennan: It is true that at present the effect is broadly neutral. It should be emphasised that British consumers are major beneficiaries of the tariff cuts which have already been made between the United Kingdom and our Community partners in respect of nonfood items—for example clothing, on which tariffs have come down from 20 per cent. to 8 per cent.; furniture, from 10 per cent. to 4 per cent.; carpets, from 25 per cent. to 10 per cent., and radios, from 15 per cent. to 6 per cent. Taking food and other goods together, broadly the effect of our membership of the Community on the level of prices has been to restrain it. The effect has not been very great, but every help in dealing with inflation is good to have.
    Mr. Buchan: I think my hon. Friend will accept that I doubt almost all he has just said. Would he not agree that far from our having power to deal with our own prices, especially of food, we are
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    compelled to put an import levy on them if they fall below Common Market prices? Therefore, we are on a compulsory ladder in which every rung is pushing up our prices whether we wish them to go up or not.
    Mr. Maclennan: I hope that my hon. Friend is not doubting the accuracy of the tariff cuts to which I have referred. As a former Agriculture Minister he will know that we had levies and import quotas under our agricultural system even before entry into the Community and that the Community export levies have positively held down the price of cereals during the past year and have enabled us to keep the price of bread lower than it might otherwise have been.
    Mr. Marten: Is not the whole system based upon keeping prices of food up in the Common Market? Would it not be more sensible if the money that we have to pay to the Community for keeping prices up could be spent on keeping food prices down in this country?
    Mr. Maclennan: No, the hon. Gentleman is quite wrong. The objective is to keep prices stable.
    Mr. Marten: What about butter?
    Mr. Maclennan: The hon. Gentleman will know, for example, that by a direct Community subsidy worth £40 million in recent months we have been able to keep down the price of sugar to the British consumer.
    Mr. Tim Rentonasked the Secretary of State for Prices and Consumer Protection what she estimates will be the effect on the average family's weekly food bill of Great Britain leaving the EEC.
    Mr. Peter Morrisonasked the Secretary of State for Prices and Consumer Protection what effect she estimates withdrawal from the EEC would have on the housewife's weekly budget.
    Mrs. Shirley Williams: Membership of the Community is at present having no significant effect on food prices overall.
    Mr. Renton: Does the right hon. Lady share my concern that the price of food as measured by The Guardian shopping basket went up by 5 per cent. in March alone? Bearing in mind that the official

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    Labour Party propaganda machine will be using that fact, what opportunities will she have in the coming weeks to point out that only a small part of that rise was due to our membership of the EEC?
    Mrs. Shirley Williams: One of the main effects on the increase in the food index arose from the decision taken in our own Annual Farm Price Review with respect to the price to be paid to dairy farmers in the light of their soaring costs. One must therefore make clear the reasons for this increase in the index, which had virtually nothing to do with the EEC, although I must repeat that there was some effect on butter and cheese prices in consequence of the April transitional step.
    Mr. Dempsey: Is it not the case that the EEC has decided to apply value added tax to food prices next year? In view of the policy of harmonising these taxes as a result of our membership, will that not also mean that VAT will be applied to food prices in the United Kingdom?
    Mrs. Shirley Williams: No, there is no question of this country having to accept VAT on food or on children's clothing unless we decided as a national Government to do so.
    Mrs. Bain: Would the right hon. Lady agree that the ultimate harmonisation of food prices within the EEC could mean ultimately that food costs could take as much as one-half or two-thirds of the average weekly family income in the United Kingdom?
    Mrs. Shirley Williams: If so, it would be different from the experience of all other countries in the Common Market, some of which have been members for almost 16 years and in none of which is anything like that proportion of income spent on food. Such a situation would require a number of circumstances which seem to me to be extremely improbable.
    Mr. Morrison: Would the right hon. Lady be concerned about the future supplies of food if we were to withdraw from the EEC?
    Mrs. Shirley Williams: None of us, whatever our views on the EEC, can make any final statement about supplies outside the Community. What we can say is that the degree of self-sufficiency in temperate
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    products in the Community offers some stability which we cannot be equally sure would be paralleled in the outside world. The recent experience over sugar and even more the experience of New Zealand, which was unable to meet its own quotas of butter and cheese permitted in 1974, suggest that there is some uncertainty about supplies in the world outside.
    Dr. Bray: My right hon. Friend said that the present net effect of our membership of the EEC on food prices was zero. Can she say how much the net effect has varied since we became a member?
    Mrs. Shirley Williams: First, I should not like my hon. Friend to assume that the effect has been zero. I cannot say that it has been. I can say that there is no significant effect, the problem being quite simply that no one can precisely ascribe the sugar subsidy, amounting to over £40 million, to any particular person's purchases of sugar. If people buy EEC or world sugar, that sugar is subsidised to the extent of 20p on a 2-lb. bag. If they buy Caribbean sugar under the CSA, it is not subsidised to the same extent. I hope the House appreciates that we are trying to give the clearest picture we can and that there is some difficulty about presenting precise figures. Broadly speaking, there is no significant effect; if we include sugar, there is a mildly favourable effect; if we exclude it, there is a mildly unfavourable effect.
    Secondly, in 1974 as a year there is no doubt that there was a favourable net effect in terms of food prices. My hon. Friend will appreciate that we are having to give from week to week the most up-to-date figure we can.

    Food Subsidies
    Mr. Gowasked the Secretary of State for Prices and Consumer Protection what is her latest estimate of the total cost of food subsidies for the financial year ending 5th April 1976.
    Mrs. Shirley Williams: About £550 million.
    Mr. Gow: Is it the case that more than half of that £550 million will go in the current year to families with an income of more than £50 a week? Secondly, does the right hon. Lady agree with the

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    Chancellor's policy of reducing food subsidies by £150 million next year? If she does, why can the reduction be right next year but not right this year?
    Mrs. Shirley Williams: On the second part of that question, the hon. Gentleman will recall that as long ago as the Prices Act 1974 I made it clear that the food subsidy was a response to the high level of raw material food costs which we were facing at the time. For evidence of that statement, I refer the hon. Member to Hansard, 10th February 1975, col. 24–25. As for his perpetual view that the subsidies largely benefit the better off, recent research has indicated, taking into account the expenditure on food as a proportion of household budgets and the expenditure on subsidised foods within the amounts spent on food overall, that the broad benefit to families with under £20 a week income is nearly four times as great proportionately as to families with incomes of £80 or over.
    Mr. loan Evans: Would my right hon. Friend agree that, as we have moved forward from the cheap food policy that we have had under successive Governments since the end of the war to the dear food policy that we might have to pursue as a member of the EEC, food subsidies have kept prices down, that housewives in Britain can buy German butter far cheaper than it can be bought in Germany and that a housewife in Northern Ireland can buy Kerrygold butter cheaper than it can be bought in Southern Ireland? Have not food subsidies helped a great deal, transitionally at any rate, to keep down prices?
    Mrs. Shirley Williams: I welcome my hon. Friend's support for the food subsidy policy. I hope he will take heart from the fact that, judging from the most recent statement by the Commissioner for Agriculture, M. Lardinois, it appears that we are beginning to persuade the Community of the benefits of a food subsidy policy. Perhaps the Opposition will notice that already it seems that, if we remain in the Community, it will adopt the system of food subsidies, as I hope it will.
    Mrs. Sally Oppenheim: Despite the fact that she seems to be taking heart, is
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    the Secretary of State aware that the difference in the increase in food prices under the Conservative administration and under the present Government is startling, even allowing for transport costs and the other factors that she quoted? During the last three months under this Government food prices have risen by 10 per cent. In our last three months they rose by 5 per cent. This is a basis of comparison which both the Secretary of State and the Minister of State are fond of using. Taking the comparison on a six-monthly basis, under this Government food prices have risen by 17 per cent. compared with 11 per cent. under the previous Conservative Government. Is it not therefore nonsense to claim any noticeable significance for food subsidies?
    Mrs. Shirley Williams: It all depends what months one chooses. I was not going to pursue this question, but if I were asked to do so I would point out that, on the basis of a three-months average, the highest increase in food prices that we have ever had was in the period immediately at the time that the last administration left office.
    Mr. Gow: On a point or order. I beg to give notice that, in view of the right hon. Lady's unsatisfactory reply, I shall seek to raise the matter as soon as possible on the Adjournment.

    Unit Pricing
    Mr. Cartwrightasked the Secretary of State for Prices and Consumer Protection what action she is taking to encourage a wider use of unit pricing in shops and supermarkets.
    Mr. Freudasked the Secretary of State for Prices and Consumer Protection what progress has been made towards the introducing of mandatory unit pricing.
    Mr. Maclennan: Following the favourable reception to our initial price marking orders we are pressing on with our plans for extending mandatory unit pricing to other fresh and frozen foods. In particular we are holding discussions with the interests concerned on meat, poultry, fish, fruit and vegetables to consider the most suitable methods of so doing. My right hon. Friend hopes to be able to make a further batch of orders before the Summer Recess.
    Mr. Cartwright: I am grateful to hear of the progress that is being made. Would not my hon. Friend agree that the bewildering array of prices, sizes and brands on supermarket shelves makes it virtually impossible for the housewife to exercise intelligent value-for-money choice unless she carries a slide rule or a pocket calculator? Does not my hon. Friend agree that the introduction of unit pricing is the best way of enabling the housewife to make intelligent choices? Will he therefore press on firmly with this policy?
    Mr. Maclennan: I am grateful to my hon. Friend for his support. We attach considerable importance to making as rapid progress as possible in this rather difficult area. There are very complicated problems which my hon. Friend will understand, particularly in respect of unit pricing of meat. There are other areas in which we hope to be able to provide better information—for example, by prescribed quantities.
    Mr. Giles Shaw: Does not the hon. Gentleman agree that two of the problems involved here are, first, indecision about whether we are part of the Community —a definite decision on this point would help manufacturers to unit-price packages which are constant—and, secondly, the position with regard to metrication?
    Mr. Maclennan: To be fair, we must proceed with unit pricing whether or not we decide to remain within the Common Market. We are bearing the metrication issue very much in mind.

    Hearing Aids
    Mr. McCrindleasked the Secretary of State for Prices and Consumer Protection how many representations she has received on the sale by commercial firms of hearing aids.
    The Minister of State, Department of Prices and Consumer Protection (Mr. Alan Williams): Three.
    Mr. McCrindle: Is the Minister aware that there appear to be some firms in Britain engaging in high-pressure sales techniques for hearing aids and directed principally at elderly people? Does he not think that, just as spectacles must be prescribed by an optician and dentures by a dentist, there is a strong argument for moving towards a situation in which
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    those with some professional qualification are involved in the business of supplying hearing aids?
    Mr. Alan Williams: Indeed, I agree. I advise the hon. Gentleman to look at the work of the Hearing Aid Council and the code of practice which has been produced. We have received only three specific examples in the Department. If the hon. Gentleman has any which have been broueht to his attention, I shall be glad to ask the Hearing Aid Council Investigating Committee to look at them.

    Fuel (Pricing)
    Mr. Canavanasked the Secretary of State for Prices and Consumer Protection whether she is satisfied with the powers of her Department in controlling the pricing of fuel.
    Mr. Alan Williams: Yes. The Price Code applies to the production and sale of fuel in both the public and the private sectors. While we have no direct powers to control the price of fuel, the Government have asked the gas and electricity industry to restructure tariffs in favour of the smaller consumer and phase in increases with social security and pension upratings.
    Mr. Canavan: Is my hon. Friend able to do anything concerning complaints from consumers about coal merchants raising their prices by an unjustifiable amount? Does he not consider that it is rather unfair on consumers, particularly those with low incomes, that they have to bear the brunt of the withdrawal of subsidies from the nationalised industries and at the same time must suffer further increases imposed by coal merchants which appear to be out of proportion to the merchants' real increase in costs?
    Mr. Alan Williams: Yes, we share my hon. Friend's concern. We appreciate that all too often it is the poorest consumer who is the coal consumer. It is for that reason that only recently my right hon. Friend announced that the distributors' margins on coal are to be examined in one of the processes of special review undertaken by the Price Commission.
    Mr. Mike Thomas: What part does my hon. Friend or his assistants and servants play in the committee which the

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    Chancellor of the Exchequer told us just before the Easter Recess was to be set up to look after the interests of the poor in the matter of inflation? What representations did the Department make about the division in the electricity increases between the increase in the industrial tariff, which was very small, and the increase in the domestic tariff, which was very large?
    Mr. Alan Williams: We are represented on that committee and our aim has always been to protect the consumer as far as we can.

    Petrol (Retail Margins)
    Mr. Leslie Huckfieldasked the Secretary of State for Prices and Consumer Protection whether she will make a statement about her future intentions for legislation, following publication of the Price Commission's report on petrol retail margins.
    Mrs. Shirley Williams: I have not yet received the Price Commission's final report. The interim report published in March did not suggest grounds for legislation.
    Mr. Huckfield: Does my right hon. Friend recollect that at the time of the November Budget garages and oil companies were saying that they had to have an increase on top of the VAT increase for their very survival? Has she noticed that we now have garages offering up to 6p a gallon discount and even sixfold stamps in some places?
    Mr. Mike Thomas: It is called "sexfold".
    Mr. Huckfield: I do not know about that.
    Mr. Thomas: It is eightfold down the Old Kent Road.
    Mr. Huckfield: Is my right hon. Friend aware that I am told by garages that they have been pressurised by oil companies to give these discounts? As they were very loud in asking for the last increase and as they can now afford to give large discounts, should not the Price Commission be asked to re-examine this whole question?
    Mrs. Shirley Williams: The Price Commission's interim report suggests that
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    one of the reasons for price cutting and for the offer of stamps many times over —I take note of what my hon. Friend the Member for Newcastle-upon-Tyne, East (Mr. Thomas) said—is mainly that a price war is going on in garages against a situation of falling demand. However, I add that in so far as this price cutting may be due to pressure from oil companies on solus tied garages this is a matter that I have asked the Director General of Fair 'Trading to look at again in connection with the report of the Monopolies Commission which concerned itself with solus trading.
    Mr. Powell: Will the Secretary of State give an assurance that the Government will adopt no policies the object of which is to keep petroleum prices up?
    Mrs. Shirley Williams: The right hon Gentleman can accept our assurance on that. He will know that one of the reasons why my right hon. Friend withdrew the maximum prices order at the end of last year was that in the face of rising supplies there were indications that prices would fall rather than rise.

    Food Prices
    Mr. Ridleyasked the Secretary of State for Prices and Consumer Protection what has been the change in the last three months in the price of imported foodstuffs; and what has been the change in the same period in the retail price of food in British shops.
    Mr. Maclennan: Between December 1974 and March 1975 the unit value of imported food and feeding stuffs rose by 7 per cent. Over the same period the retail food index rose by 10·1 per cent.
    Mr. Ridley: Do not those figures show that the myth that inflation of food prices is caused either by overseas suppliers or by the Common Market can now be totally discarded and that indeed our inflation is entirely caused by the Government's own domestic economic policies and nobody else is to blame?
    Mr. Maclennan: I am glad that the hon. Gentleman has recognised the minimal effect of the Common Market upon the direction of prices in this country. If what he is referring to is his traditional preoccupation with the money

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    supply as a contributory factor to inflation, I would simply point out that on either definition the money supply is growing more slowly than the national income in money terms.
    Mr. Neubert: Is the hon. Gentleman satisfied with the sources of his statistics on retail prices? Is he aware that in my constituency of Romford a weekly shopping survey based on the local branch of the London Co-op and published in a local newspaper has shown that in the last three months a sample basket of 33 standard items has increased in price at an annual rate in excess of 50 per cent.?
    Mr. Maclennan: I recognise that there are some variations, and it is partly with this in mind that my right hon. Friend has recently made a special reference to the Price Commission. Our own calculations are based upon figures provided by the Department of Employment which, I think, are highly reliable and are a better guide than selective localised information.
    Mr. Joan Evans: Has my hon. Friend seen the comments by Robin Pooley, the Vice-President of the EEC Beef Consultative Committee, that the cost of keeping the beef mountain is likely to be the
    "biggest financial scandal of the century"?
    If we want to try to keep down import prices, why cannot we do something about the ½million tons of beef which are now stored in the Common Market and are deteriorating rapidly?
    Mr. Maclennan: My hon. Friend will know that one of the major successes by my right hon. Friend the Minister of Agriculture, Fisheries and Food in the renegotiations was in respect of the departure from the old system of intervention support to the new variable premium system. This is a most important return to the deficiency payment system which this country has operated effectively and which should preclude the likelihood of similar beef mountains being accumulated in the future. It is important to stress that the stocktaking of the common agricultural policy emphasises the Commission's view that these stockpiles in the future must be disposed of by means of selling in the Community and. if necessary, at subsidised prices for the benefit of consumers.

    Consumer Affairs (Publicity)
    Mr. Wakehamasked the Secretary of State for Prices and Consumer Protection what information she provides in respect of the broadcasting of consumer matters.
    Mr. Maclennan: My Department provides the fullest information to the broadcasting organisations and the programme companies as it does to all other communications media, and we arc grateful for the constructive use they make of it. We arc always glad to discuss with them any ideas for improvement.
    Mr. Wakeham: Can the Minister say how he considers that our consumer programmes compare with the consumer programmes of the European Community and whether he thinks there is any help that his Department can give to increase the standard of our programmes to the standard of the best within the Community?
    Mr. Maclennan: My impression is that the consumer programmes in this country are superior to those elsewhere, and we have sought to bring to the attention of the Commission recently the good work done in this country on this matter. The Consumer Information programme of the Community, however, has recently been approved by the Council of Ministers, and the Community is moving rapidly in the matter.
    Mr. Lipton: Will my hon. Friend look at the excellent consumer services provided by the London borough of Lambeth which makes it unnecessary for housewives to stay at home listening to the radio? All they have to do is to go to the appropriate department of the town hall where they can get all the information they want about everything.
    Mr. Maclennan: I very much welcome the local initiative of the London borough of Lambeth and, indeed, of a number of local authorities. We fully recognise that the most helpful information is that provided locally, close to where people actually shop.

    Trade Descriptions Act
    Mr. Sainsburyasked the Secretary of State for Prices and Consumer Protection when she expects the review of the Trade Descriptions Act to be completed.
    Mr. Alan Williams: The interdepartmental committee which is reviewing the working of the Trade Descriptions Act 1968, under the chairmanship of the Director General of Fair Trading, will shortly publish a consultative document. The committee's report, which will take account of the comments received from a wide range of industry, trade and consumer bodies, is expected by the end of this year.
    Mr. Sainsbury: Does the Minister agree that at a time of rapidly rising prices there is potentially more confusion in special offers? Does he further accept that one of the greatest sources of confusion is the combination of coupons with special prices? Can he assure the House that this aspect will be given special attention and, one hopes, early recommendations?
    Mr. Alan Williams: Yes, I fully understand the difficulties to which the hon. Gentleman refers. Indeed, probing the work of price comparison, which is what the hon. Gentleman is concerned with, will be more effectively dealt with under Part II of the Fair Trading Act than under a revision of the Trade Descriptions Act. It could certainly be dealt with more quickly. I believe that the Director General will be coming forward with a consultative document in this sector in the near future.
    Mr. Buchan: In view of the outrageous claims made by the various Common Market organisations, such as the claim that the EEC keeps down food prices, would it not be a good idea to refer the EEC for investigation under the Trade Descriptions Act?
    Mr. Alan Williams: I am hardly answerable for all the claims made by either side, but I detect occasionally certain touches of extravagance, particularly from those opposed to the Market.

    Retail Price Index
    Mr. Budgenasked the Secretary of State for Prices and Consumer Protection
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    what is the current rate of price increases based on the last three months of the retail price index expressed at an annual rate.
    Sir George Youngasked the Secretary of State for Prices and Consumer Protection what has been the increase in the retail price index during the past 12 months.
    Mr. Rostasked the Secretary of State for Prices and Consumer Protection, what is the current rate of inflation, based upon a grossing-up to an annual rate of the last three months increase in the Retail Price Index.
    Mrs. Shirley Williams: The increases in the retail price index over the 12 months to March 1975 was 21·2 per cent. The change over the three months to March 1975, expressed at an annual rate, was 25·6 per cent.
    Mr. Budgen: Does the right hon. Lady agree that those figures indicate that the only effect of the elaborate mechanism of price control is temporarily to suppress the symptoms of inflation? Does she not now openly agree with what her colleague the Chancellor of the Exchequer said in many passages of his Budget Statement that the only long-term and effective way of controlling inflation is by controlling the supply of money?
    Mrs. Shirley Williams: No, I do not agree with that. What we can say clearly is that the annual rate of increase, where there are neither food subsidies nor a Price Code, would be about four or five points higher. It would not be responsible to allow that situation to arise. The hon. Gentleman would make a mistake if he were to put too much reliance on a three months' figure. As I said earlier to the hon. Lady the Member for Gloucester (Mrs. Oppenheim), in the three months to April 1974 which were indexed in that period part of which came during the administration of the hon. Lady's party and part during ours, the annual rate on a three-month basis was 26·7 per cent. while in the summer it fell to 8.4 per cent. It is a great mistake to base too many assumptions on those three months' figures.
    Mr. Mike Thomas: Does my right hon. Friend agree that even on the figures put forward by Opposition Members the end

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    of the Price Code would mean an acceleration of the inflation rate? Does she further agree that it ill behoves hon. Members opposite, who belong to a party which has no economic policy to speak of, to abuse the efforts of the present Government who are trying to combat inflation?
    Mrs. Shirley Williams: Yes, I accept that. It is true. We are taking steps to modify inflation so far as we can. It would be fair to add that the reasons for British inflation lie very deep in other spheres as well as in the increase in raw material prices, which have markedly slowed down. One cause is an increase in incomes. Ours is a low wage economy basically, and one reason for this is the failure over many years to invest adequately.
    Mr. Rost: Why is our rate of inflation so much higher than that among our European partners—indeed four times that of Germany? Could it be that our European partners have competent Ministers prepared to exercise firm policies against inflation whereas the right hon. Lady's Cabinet colleagues have surrendered responsibility, decision-taking and sovereignty to the TUC?
    Mrs. Shirley Williams: That is a good political remark from the hon. Gentleman but it is a long way from the truth. One element of the truth was expressed in Sir Don Ryder's report about British Leyland, when he pointed out that car workers in British Leyland were using machinery far older than that behind any of their competitive workers in the countries of Europe. That also has a great deal to do with the current situation.
    Mrs. Sally Oppenheim: As we have now crossed the hyper-inflation threshold under the present Government, and as our rate of inflation is nothing short of a national disaster, if the right hon. Lady does not approve of the taking of three-month inflation rates, as she says, why did she and her right hon. Friend the Chancellor of the Exchequer at the time of the last election take a three-month inflation rate of 8·4 per cent—it now being nearly 300 per cent. higher? As a consequence, will the right hon. Lady rename her department the Department of Higher Prices and Consumer Deception?
    Mrs. Shirley Williams: The hon. Lady will recall, if she can remember that far back, that I based my remarks at the time of the election on the statement of the Price Commission, that statement being that in the summer the rate of inflation was running at approximately 12 per cent. I quoted that in my statement at Transport House, and it was absolutely accurate.
    No responsible person on either side of the House, faced with the sort of inflation which we now have, should be unaware that this situation is to some extent within our control. I have already said that incomes, on the one side, and a failure to invest, on the other side, have a great deal to do with it, regardless of the Government's colour.
    Dr. Bray: Will not falling bonus and overtime earnings and the rising level of unemployment mean that consumers' expenditure is likely to fall well behind the rate of increase in real earnings? Will my right hon. Friend therefore make sure that every pressure is maintained to keep down the cost of living so that there is not an undue deflationary effect?
    Mrs. Shirley Williams: What my hon. Friend says is well taken, but he will appreciate that it is important that the cost of living and the level of earnings should be kept broadly in line with one another in the situation which we as a country face, given our balance of payments difficulties. I assure my hon. Friend that it will be very much in our interests as a country to see the cost of living fall, and I have some reason to believe that that will happen towards the end of the year, assuming no increase in the rate of income supplements.

    Price Commission Index
    Mr. Neubertasked the Secretary of State for Prices and Consumer Protection what has been the increase in the Price Commission Index since November 1974.
    Mr. Maclennan: The index for the period since November 1974 will not be available until the Price Commission's report covering 1st December 1974 to 28th February 1975 is published tomorrow.
    Mr. Neubert: As the Price Commission's last report confirmed that one

    21
    man's pay rise is another man's price rise, and as wage rises over the past 12 months have averaged more than 30 per cent., how could the hon. Gentleman's right hon. Friend claim only six months ago, at the time of the election, that there was no evidence whatever of price increases stored up in the pipeline?
    Mr. Maclennan: I think that the hon. Gentleman's supplementary question relates to a report not yet forthcoming. Therefore, it does not arise.

    Director General of Fair Trading
    Mr. Madelasked the Secretary of State for Prices and Consumer Protection if she will seek powers to alter the responsibilities of the Director General of Fair Trading in relation to his availability to the public.
    Mr. Alan Williams: No, Sir; but if the hon. Member has any particular problems in mind I shall be glad to consider them.
    Mr. Madel: As it is important that the public should know that the Director General of Fair Trading has been appointed as the consumer's ombudsman, will the Minister ask him and his Office of Fair Trading to start a publicity campaign to encourage the public to approach him and his office direct if they feel that they have cause to complain in the matter of fair trading?
    Mr. Alan Williams: With respect, I think that that would be unhelpful, and I believe that the hon. Gentleman's own Front Bench would agree with the thinking here. Both Front Benches took the same view throughout the whole process of the fair trading legislation: that the räle of the Director General was to be at the top of a pyramid of a consumer advice service feeding processed information to the Government so that we could devise legislation. In other words, his is essentially a policy räle. Consumer protection for the individual should start at local level, and if we encouraged the public to do as the hon. Gentleman requests we should so flood the Director General with detailed cases that he would be unable to get on with his policy work.

    Garages (Code of Practice)
    Mr. loan Evansasked the Secretary of State for Prices and Consumer Protection what representations she made to the Office of Fair Trading regarding the discussions it is having with garages on a code of practice, following publication of evidence relating to malpractices in the trade.
    Mr. Alan Williams: I asked the Director General in August 1074 to take account, in his discussions with the motor industry on a code of practice, of the Automobile Association's findings that a high proportion of new cars are handed over to purchasers by motor dealers without adequate pre-delivery inspection.
    Mr. Evans: I thank my hon. Friend for that reply. Did he see the report over the weekend that motorists are now spending more on their cars than the average owner-occupier spends in buying a house? In view of the increase in petrol and other motoring costs, is not the need for consumer protection for the motorist greater now than ever before? Did my hon. Friend see in the recent issue of the Consumers Association publication Motoring Which? that the person seeking service from a garage is not getting a fair deal—in fact, he is getting a raw deal—and that many cars are leaving garages in such a condition that they may well be involved in accidents because inadequate care is taken.
    Mr. Alan Williams: I saw those reports, and motor vehicles are among the goods about which we have most complaints in the Department, as I imagine my hon. Friend would expect. However, the Director General assures me that he is receiving co-operative assistance from this industry at present, and he has now issued a consultative document to the industry in the hope of establishing a code of practice. I hope that perhaps later in the year, or early next year, we may be able to produce something meaningful and helpful to the motorist.
    Mr. Norman Lamont: Is the Minister aware that the survey to which reference has been made showed that two-thirds of garages were doing inadequate maintenance and one-third were doing dangerously inadequate maintenance? Is not

    23
    this a matter of some urgency? Apart from a code of practice, ought there not to be some inspections by trading standards officers?
    Mr. Alan Williams: One has to have proper follow-up procedures and enforcement procedures if a code is to operate. However, as I said, in the summer of last year I asked the Director General to undertake an investigation, and he has assured me that he is receiving no obstruction from the trade asociations involved and none of them is in any way blocking or opposing his investigation. We must now, I think, use the existing machinery under the Fair Trading Act to allow the Director General to fulfil his commission.
    Mr. Cryer: Will my hon. Friend make representations to the Director General about the service industry sector, since in the absence of legislation—he must be aware of this—many service industries provide contacts with wide-ranging exclusion clauses which are a detriment to any legal action which subsequently occurs, this applying in particular to organisations such as travel firms, Laker, Pontins and so on? Will my hon. Friend make representations to ensure adequate consumer protection until we have legislation?
    Mr. Alan Williams: I doubt that that would necessarily produce worthwhile results either. As my hon. Friend is aware, the Law Commissioners are now in the process of completing a rather long-drawn-out inquiry into exclusion clauses in the service sector. Legislation has already been implemented in regard to goods. We expect that when the Law Commissioners produce their recommendations some time this year, they will, as previously, produce a draft Bill, which in turn will be the subject of consultation and then legislation.
    Mr. Leslie Huekfield: Reverting to the question of garages, is my hon. Friend aware that it is not just the garages themselves which need investigation but their relationship with the oil companies and with the motor manufacturers? Does not my hon. Friend consider that the time has come for further investigation of the sort of tripartite system which exists in Sweden, for example, between the garages, the insurance companies and the State?
    Mr. Alan Williams: I am quite willing to consider the point which my hon. Friend puts.

    Fireworks
    Mr. James Johnsonasked the Secretary of State for Prices and Consumer Protection when she hopes to make public the consultative document concerning fireworks; and if she will make a statement.
    Mr. Alan Williams: Copies of the consultative document on firework safety have today been sent to all the bodies whom we know to be interested. They have been invited to submit views to my Department on any aspect of the sale and use of fireworks and the possible need for altering or extending the existing controls. Copies of the document have been placed in the Libraries of both Houses of Parliament and are also available on request to any other bodies or persons who may wish to comment.
    Mr. Johnson: I have not yet had time to study the document. Is my hon. Friend aware that only a small minority of nations have passed any fireworks legislation in the past 20 years and that we are functioning under the fireworks legislation of 100 years ago? We of all the civilised nations do what the uncivilised nations do. Is my hon. Friend aware that we have more accidents during the Guy Fawkes period than are incurred by any other nation? In view of this, will he be kind enough to give an assurance that he will receive a deputation of hon. Members and interested parties?
    Mr. Alan Williams: I am grateful to my hon. Friend for imposing upon himself the unusual constraint in this House of saying that he wants to read the document before seeking to comment on it. I trust that other hon. Members will do the same. I accept his point and I am sure that he will take as an indication of our good faith the fact that I announced the intention of producing this consultative document literally within days of my Department's assuming responsibility for safety. I appreciate my hon. Friend's comments about the number of accidents and I would welcome deputations consisting of Members from either side or both sides of the House if hon. Members wish to discuss this matter with me.
    Mr. Monro: Will the Minister confirm that there has been a welcome improvement in the accident record? Can he say whether the manufacturers would agree to an age limit on sales, and will he assure the House that there will be the fullest consultation before any changes in regulations or legislation are introduced?
    Mr. Alan Williams: There will certainly be the fullest consultation. I think the hon. Member will find that the document and the covering letter 1 have sent with it show that we are quite willing to look at any possibility which, if practical and sensible, will ease the situation and reduce the number of accidents. The decline in accidents is most encouraging. Last year the decline in total accidents and in serious accidents was approximately 25 per cent., but of course we should like the level to be even lower.
    Miss Fookes: Will the Minister assure us that the time taken in consultations will not be simply an excuse for yet further delay before a decision is finally made?
    Mr. Alan Williams: The hon. Lady amazes me. In all the time that the Conservatives were in office, no meaningful moves were made on fireworks legislation. Within days of assuming responsibility I took action, and now she is accusing me of dilatoriness. I shall make sure that there is no unnecessary delay. We have put a time limit on the consultation and ask for all reports to be made to me by 16th June.

  TRADE

    Tourism
    Mr. Adleyasked the Secretary of State for Trade what steps he has taken to consult commercial interests in the travel, transport, hotel and catering industries, in his current review of Her Majesty's Government's policy for tourism; and what further consultations he plans to have.
    The Under-Secretary of State for Trade (Mr. Eric Deakins): The Development of Tourism Act 1969 established the British Tourist Authority and the English Tourist Board to advise us on matters relating to tourism. Accordingly our consultations on policy are conducted through them.
    26
    Such consultations are naturally on a continuing basis.
    Mr. Adley: Is the Minister aware that in his absence his hon. Friend indicated in reply to me that he would be prepared to receive representations from the industry, and not only from the tourist bodies? Does he understand that if he is talking only to the people on whose patronage he depends and who in their turn depend on him, he is likely to get only the answer he is looking for? Will he take positive steps to talk to people who work in the industry so that the review of tourism can be meaningful?
    Mr. Deakins: Now that the guidelines nave been announced and we are having discussions on them it is up to the industry to make such representations as it wishes. We drew the matter to the attention of the trade and the rest of the country in a Press notice dated 21st November last year, and we are always open to receive representations from the industry. So far we have had representations from only one particular organisation representing the commercial interests.
    Mr. Wigley: Is the Minister aware of the considerable difficulty felt in many parts of the tourist industry on account not only of the increasing cost of rates but of the capital burden quite rightly placed on them by safety precautions and such things as fire escapes? In these circumstances will he consider amending the Development of Tourism Act to give additional help over this difficult period?
    Mr. Deakins: We do not intend to amend the Act. We have announced the new guidelines, and the basis of them is that there will be no increase in the real resources of Government expenditure devoted to tourism in the next few years. Within that static total there are various ways in which money can be allocated for the various purposes of tourism, including those which the hon. Gentleman mentioned, but it is up to the tourist authority and the tourist boards together with the Government and the interests concerned to decide on the best allocation in the national interest.
    Mr. Evelyn King: There is the gravest dissatisfaction among restaurant and hotel proprietors not at the fact that

    27
    there are fire regulations, which are accepted, but because they are imposed wholly at the whim of the local fire officer. There is no appeal, and different fire officers say different things. In the case of one West Country hotel there have been four fire officers in succession each demanding different things, and this is becoming something of a public scandal.
    Mr. Deakins: Responsibility for the Fire Precautions Act belongs to the Home Secretary. I shall make sure that the hon. Member's observations are brought to my right hon. Friend's attention.

    Airports (Development)
    Mr. Wrigglesworthasked the Secretary of State for Trade if he will make a statement about the future development of Teesside Airport.
    Mr. Leadbitterasked the Secretary of State for Trade what representations he has received on the airport development recommendations made by the CAA, in particular on the future of Teesside Airport; and if he will make a statement.
    The Under-Secretary of State for Trade (Mr. Clinton Davis): I would refer to the reply given to my hon. Friend the Member for Stockport, North (Mr. Bennett) on 16th April.—[Vol. 890, c. 131.] It would not be appropriate to make a statement about Teesside Airport in advance of the consultation document on regional airports to which I referred.
    Mr. Wrigglesworth: Is my hon. Friend aware of the very strong feeling on Teesside at the rejection by the Civil Aviation Authority of the findings of the Northern Airport Study, which cost £25,000, that Teesside Airport should be developed? Is he aware that the growth of the steel and petrochemical industries on Teesside will provide a vast demand for an airport of the size recommended by the independent study? Will he bear these points in mind when considering the findings of the Civil Aviation Authority?
    Mr. Davis: My hon. Friend will appreciate that the recommendations of the CAA are persuasive and not conclusive. The other factors to which he has adverted will be taken into account when we make our final decision on the matter. If my hon. Friend is suggesting that an
    28
    application for assistance is to be produced, I must tell him that we could consider that only if the criteria are satisfied that the airport must be indispensable to the national air transport system and that the burden of running it is more than the local community can reasonably be expected to bear.
    Mr. Cryer: Will my hon. Friend make those comments to the Conservative-controlled Bradford Metropolitan District Council, which is about to embark upon £7 million expenditure on the Leeds—Bradford Airport? Will he dissuade it from embarking on this expenditure, which will be a very heavy burden for the ratepayers of the area?
    Mr. Davis: That local authority, just as any other, is well aware of the fact that we are engaged in a review. It is not for me to deflect it from its course by any order or power I may invoke. It is aware of the situation, and if it seeks to embark upon its course before a national airports policy is promulgated that is a matter for the council itself.
    Mr. Brittan: The views expressed by the hon. Member for Thornaby (Mr. Wrigglesworth) will command wide support throughout the region on an all-party basis.
    Mr. Mike Thomas: No.
    Mr. Brittan: There are many people outside the hon. Member's constituency who will very much hope that the factors he has put before the Minister will be taken fully into account when the matter comes finally to be decided.
    Mr. Davis: The hon. Member has made his constituency point. I have nothing to add to the answer I have already given.
    Mr. Mike Thomas: Will my hon. Friend accept that the references by the hon. Member for Cleveland and Whitby (Mr. Brittan) to the views of the region are contrary to those of many of us in the North-East? Some of us are extremely concerned at the threat posed in the report, about which I was delighted to hear my hon. Friend's sceptical comments, to the airport of the regional capital, Newcastle. Many of us would be anxious if anything that his Department did prejudiced the development of the city's airport.
    Mr. Davis: My hon. Friend has made a similar point in principle to that made by the hon. Member for Cleveland and Whitby (Mr. Brittan) a few moments ago. I can add nothing to what I have already said. All these considerations will be taken into account.

  WALES

    Welsh Assembly
    Mr. Wigleyasked the Secretary of State for Wales what progress he has made in regard to building accommodation for the proposed Welsh National Assembly.
    The Under-Secretary of State for Wales (Mr. Edward Rowlands): Consultations are proceeding with a view to identifying and preparing suitable accommodation for the Assembly in Cardiff.
    Mr. Wigley: Is the Minister aware of the statement by the Leader of the House the week before last that there may be a White Paper on devolution in the autumn? Is he aware that this has led to worry in Wales about further delays in the setting up of the Welsh National Assembly? Does he not feel that if the Assembly is to be set up in line with the Government's original proposals the building aspects of it should already have been sorted out?
    Mr. Rowlands: I do not think they need to have been sorted out, but they are being urgently considered and we are looking at the various possibilities. On these practical matters we shall be well up to timetable.

    BRITISH STEEL CORPORATION
    Mr. Ridley: I beg to ask leave to move the Adjournment of the House under Standing Order No. 9 for a specific and important matter that should be given urgent consideration, namely,
    "the attempt of the Secretary of State for Industry to interfere with the commercial freedom of the British Steel Corporation as enshrined by statute and the right of its chairman to free speech."
    Mr. Speaker: Order. The hon. Member appreciates that he is out of order.
    30
    If he wished to raise that matter, he should have given me notice by 12 o'clock today. That is clearly laid down in the Standing Order.

    PETITION (RATES)
    Mr. Tugendhat: I hope that you will allow me, Mr. Speaker, to make use of a point of order to draw attention to an error that has appeared in the Supplement to the Votes and Proceedings. On 21st March my hon. Friend the Member for St. Marylebone (Mr. Baker) and I presented a petition on behalf of the ratepayers of the City of Westminster. The ratepayers of Westminster were complaining about the burden of rates imposed by the Greater London Council and the Inner London Education Authority.
    When the terms of the petition were published in the Supplement to the Votes and Proceedings on 24th March, an additional and quite imaginary authority, the Inner London Council, was added to the list. I should have picked this up at the time, but I did not read it as carefully as I should have done. I assumed that when it appeared in the Votes and Proceedings, it would be correct. When the Department produced its reply, it, too, picked up Inner London Council "and made it appear as though the ratepayers were complaining against the City of Westminster, which was not their intention.
    We have therefore had a catalogue of errors in the proceedings of the House, and I should be grateful if it could he placed on the record that both the original report and the ministerial reply were in error. I do not know whether it is possible to do anything about it at this stage, but I hope that at least my statement of this correction will appear in Hansard.
    Mr. Speaker: I will consider the matter and see whether it is possible for me to unscramble this dish.

    BILL PRESENTED

      CHILD BENEFIT
      Mrs. Secretary Castle, supported by Mr. Secretary Ross, Mr. Secretary John Morris, Mr. Joel Barnett, Mr. Brian O'Malley, and Mr. Alec Jones, presented

      31
      a Bill to replace family allowances with a new benefit to be known as child benefit and, pending the introduction of that benefit, to provide an interim benefit for unmarried or separated parents with children; to repeal paragraph 5 of Schedule 2 to the Supplementary Benefit Act 1966; and for purposes connected with those matters: and the same was read the First time; and ordered to be read a Second time tomorrow and to be printed [Bill 147].

      WELSH DEVELOPMENT AGENCY BILL
      Motion made, and Question put, That the Welsh Development Agency Bill be referred to the Welsh Grand Committee. —[Mr. John Morris.]
      Whereupon not less than twenty Members having risen in their places and
      32
      signified their objection thereto, Mr. SPEAKER declared that the Noes had it pursuant to Standing Order No. 72 (Welsh Grand Committee).
      Mr. Wigley: On a point of order. Mr. Speaker. The Welsh Development Agency Bill was to have been referred to the Welsh Grand Committee as a matter of exclusively Welsh interest. Is it in order for Members representing non-Welsh constituencies to object to that?
      Mr. Speaker: The answer is "yes".
      Mr. loan Evans: On a point of order, Mr. Speaker. As there is a heavy legislative programme before the House and as there is objection to the Welsh Development Agency Bill, is it possible that the Bill will not now go through this Session, with the result that the people of Wales might not benefit from it?
      Mr. Speaker: That is not a matter for the Chair.

    ORDERS OF THE DAY

      EMPLOYMENT PROTECTION BILL
      Order for Second Reading read.
      3.34 p.m.
      The Minister of State, Department of Employment (Mr. Albert Booth): I beg to move, That the Bill be now read a Second time.
      My right hon. Friend the Secretary of State has asked me to convey his apology for his absence from the debate today. Having personal knowledge of the great extent to which the Bill is the result of his efforts and his commitment, I deeply regret that he is in a hospital bed instead of at the Dispatch Box.
      The Employment Protection Bill is the second stage of the Government's programme of industrial relations legislation. The first stage was the Trade Union and Labour Relations Act and the Trade Union and Labour Relations (Amendment) Bill repealing the controversial features of the 1971 Industrial Relations Act. This we intend to follow with an industrial democracy measure that will make a logical extension in this field.
      The two main themes of the Employment Protection Bill are the strengthening of collective bargaining and the establishment of new rights for individual employees, especially in regard to job security. Before describing the individual provisions, I want to comment briefly on these themes.
      The collective bargaining theme is reflected in many of the Bill's provisions, notably those dealing with trade union recognition, disclosure of information and the reform of wages councils. Equally if not more important is the establishment of the independent Advisory, Conciliation and Arbitration Service on a statutory basis. Within the area of individual rights the Bill introduces provisions that include guarantee payments, remuneration on suspension on medical grounds, maternity pay, the right to return to work after maternity leave, and time off for public duties.
      These individual rights are attacked on grounds of added cost to industry at a time when it can least afford it and, in the terms of the Liberal amendment, as
      34
      taking no account of the problems of small firms and small businesses. I am ready to concede to hon. Members opposite that that may be part of the case contained in the amendment tabled by the right hon. Lady the Leader of the Opposition and her hon. Friends.
      The cost argument can be and has been exaggerated. Many items in the Bill involve little or no extra cost for employers. Changes proposed in the law on unfair dismissal will affect only a minority of employers who fail to maintain generally accepted standards of reasonable behaviour towards their employees. Most of the extra cost will result from the guarantee payments and maternity provisions.
      If all the provisions of the Bill had been in force last year, we estimate that the extra annual cost to employers would have been about £100 million to £120 million. This is approximately equivalent to £5 a head or lop a week for employees. Of that about 8p would be accounted for by the guarantee payments.
      This clearly does not fall evenly on all employers. Those with no lay-offs or short time are not affected at all by the guarantee payments. In many industries where there are lay-offs and where short-time working occurs there are already voluntary schemes that are better than the modest proposals in the Bill. Where these operate, there is no need to fear additional costs being imposed as a result of the Bill.
      It is said that the Bill will bear heavily on small firms and businesses. I must make it clear that I do not in any way underestimate the problems of small firms and businesses, but I think that those problems must be tackled in other ways.
      Mr. Cyril Smith: Merely to get the record straight: I should be grateful if the hon. Gentleman would tell me which part of the Liberal amendment refers to the pressure on small businesses. I have read it three times since this morning and I cannot find it mentioned anywhere.
      Mr. Booth: I am very sorry and I apologise deeply to the hon. Member. I have accused him of words that are in the Conservative amendment, not in his. That is a terrible thing to do to any man and he has my unreserved apology. Now that I have been very properly corrected,

      35
      I can address myself to the correct quarter.
      There is a serious problem for small firms and businesses, but it must be tackled in other ways. I cannot believe that it is right to give the employees of small firms lower standards of statutory protection of conditions than those in large firms. It would be wrong on the grounds of equity and appreciation of the important räle that small firms have in our economy to make their employees second-class citizens for the purpose of employment protection.
      Mr. David Mitchell: Can the Minister tell the House whether he accepts that there are serious problems for small firms and that they must be dealt with? Can he say when the Government intend to deal with those problems and when will such a programme be announced?
      Mr. Booth: The Government are giving serious consideration to the problem of small businesses. My hon. Friend the Under-Secretary will be saying something about this when he replies to the debate.
      Dealing with those points in the Bill which strengthen collective bargaining, I note the reference in the amendment tabled by the Conservative Opposition to making
      "no attempt to establish a fair balance between … management and unions".
      What the Bill does is propose changes in the law to make it appropriate to the good management—trade union relationships that have been developed within the United Kingdom. Good management does not refuse information for negotiation. It does not fail to consult on mass redundancy. It does not refuse to recognise trade unions or seek to discriminate against employees on grounds of membership of an independent trade union.
      These are not the practices of good management in its relationships with trade unions. There is no requirement which can sensibly be laid upon us to say that we must, because these things are being required by law, deny trade unions something of their power in relation to management.
      36
      The Bill is proposing to change our law from legal support for management by managerial prerogative to legal support for management by consultation. It requires management to inform, consult and in some cases to negotiate. It does not create a legal obligation on management to agree, nor does it prescribe the outcome of those consultations and negotiations.
      Part I of the Bill establishes the Advisory, Conciliation and Arbitration Service on a statutory basis and defines its functions. It charges the service with the duty of promoting the improvement of industrial relations, encouraging the extension of collective bargaining machinery and, where necessary, the reform of such machinery. The service has a key räle to play in promoting the peaceful settlement of disputes by conciliation or by securing agreements to refer disputes to arbitration. Since the service started last September it has made good progress under the direction of Jim Mortimer and has gained the confidence of unions and management.
      In the first six months of its existence the service dealt with 50 per cent. more requests for conciliation than did the Department of Employment in the previous six months. The number of cases dealt with by arbitration in the same period increased by 100 per cent. This leads us to have confidence in this service and its ability to undertake the wider responsibility and greater räle which the Bill prescribes for it.
      Clause 10 and Schedule I provide for the establishment of a Central Arbitration Committee with an independent chairman and members drawn from the trade unions and employers' associations. It is to this body that a trade union may ultimately go to obtain a right to recognition if this cannot be resolved by negotiation or conciliation. This part of the Bill is intended to deal with the problem of the employer who refuses to recognise any union or, as is more common, the employer who recognises manual but not staff trade unions. Here I ought to declare an interest since I am a sponsored member of the technical and supervisory section of the AUEW. Although I have not discussed this with it, my union may well seek to use this provision.

      37
      This part of the Bill has another function which has not been generally appreciated. Recognition issues for the purpose of the Bill cover questions of the area of negotiation. Under these provisions the issue of whether a union which can negotiate wages and hours should be able to negotiate on other matters such as pensions or training can also be determined. It also raises within its provisions the possibility that a union which already has a negotiating agreement and is recognised for certain grades of workers may seek through this vehicle to extend that negotiating right to cover other grades of workers. Part I of the Bill also requires employers to disclose to recognised unions the information they need for collective bargaining.
      Part II covers new rights for individual employees. These include the guaranteed payments, intended to ensure that workers laid off because of shortage of work will receive certain income from their employer for a limited time. Initially it is proposed that the guaranteed payment should be a daily payment calculated from the employee's weekly pay as defined in Schedule 3. This is limited to a maximum of £6 a day and to five days in any calendar quarter. The limits can be raised by order subject to the affirmative procedure in both Houses.
      Under Clause 76 the Secretary of State is under an obligation to review these limits, and it may well be that what we are now considering will lead to a series of debates on affirmative orders in future years with this House having control of what are the minimum protections for people laid off or who start short-time working in industry. I must make it clear that this guarantee does not extend to those laid off as a result of a dispute occurring within the area of their employment or a dispute within the premises of their employer.
      The maternity provisions in Clauses 38 to 46 contain important benefits for women who leave their job on account of pregnancy and wish to return to work after childbirth. They will be entitled to six weeks' paid maternity leave if they work continuously for two years for an employer. A woman would also have the right to return to work in the occupation in which she was previously employed.
      Mr. A. P. Costain: Does the Minister not appreciate that, while this has much to commend it, those firms which employ only a small number of women will have the greatest difficulty in keeping a job open for a woman who has left to have a baby? Further, what is to become of those people who are recruited temporarily to fill the vacancy? What will their position be? Will it not be unfair to them?
      Mr. Booth: We appreciate that there are certain difficulties not only for small firms but for large firms, too, which may be required to give maternity leave to women carrying out a highly specialised job which no one else can perform. We do not think that such difficulties are confined to the small firm. We recognise that an employer must be protected against an unfair dismissal claim by someone whom he has employed on a temporary basis to fill the job of a woman on maternity leave. That is covered by the Bill.
      We also recognise that in some cases it will not be possible for employers to give exactly the same job back but rather a job in the same occupation. There are many problems attached to this. We do not deny that. We expect to debate them at length in Committee. What we are anxious to establish at this stage is that there should be, as a fundamental right of working women, the ability to take maternity leave and return to work afterwards.
      Mr. Robin Corbett(Hemel Hempstead): Will my hon. Friend confirm that in the small number of firms which currently have provisions either for full or for part paid maternity leave the problems to which the hon. Member refers have been overcome in practice?
      Mr. Booth: I can confirm that employers voluntarily operating such schemes who have discussed their problems with me have not raised this point. They have raised other problems. None of them has suggested that the problems they have faced have been such that they would wish to return to the earlier situation.
      Mr. David Mitchell: Can the Minister confirm that there is no minimum size laid down in this instance and that this

      39
      will apply to a Member of Parliament and his secretary? Can he explain how that will work?
      Mr. Booth: To the best of of my understanding we do not define minimum sizes of employer or the size of staff for the purpose of this part of the Bill. In order to establish the right of reinstatement a woman normally will have to notify her employer before she starts her maternity leave if it is her intention to return, and normally it will not be possible for maternity leave payment to start more than 11 weeks before confinement. Those are some of the conditions which attach to it.
      I want to refer to the proposals about insolvency in the Bill. These are designed to give protection to employees of firms which go bankrupt. In recent years about 30,000 to 40,000 employees a year have been affected by this problem. The Bill makes it possible for arrears of wages, holiday pay and pension fund contributions to be met from an extended redundancy payments fund. These claims will be met to a limit of £80 a week. We hope that as a result of these provisions those faced with the problem of working for a firm which goes bankrupt will be able to obtain prompter payment and will suffer less financial hardship in a way which will not damage the position of other creditors of the company.
      Part II of the Bill establishes many other rights, including protection against victimisation for trade union membership or activity, time off for trade union duties and certain types of public duty, and guaranteed payments for employees who are suspended from their normal occupation on medical grounds under a statutory requirement and for whom no alternative work is available.
      The improvements proposed in the unfair dismissal provisions of the Trade Union and Labour Relations Act are mainly to facilitate reinstatement or re-engagement rather than financial compensation for dismissal. The Government are particularly concerned about cases in which employees are dismissed for trade union membership or activity, especially because such dismissals are more likely to give rise to industrial dis
      40
      putes than most other reasons for dismissal.
      The 1971 Act put such dismissals in a special category in that they were to be treated as automatically unfair. We propose to strengthen that protection. Suitable amendments will be introduced in Committee so that an employee who considers that he has been dismissed or given notice of dismissal on account of trade union membership or activities, whether or not that is the reason given by the employer, may apply, with the support of his trade union, for a preliminary hearing by an industrial tribunal. If the tribunal is satisfied that the employee has a strong case, it will be able to give a ruling that he should be suspended on full pay. His contract of employment will then continue until his complaint of unfair dismissal has been resolved by conciliation or by a full tribunal hearing.
      Sir Derek Walker-Smith: I apologise to the hon. Gentleman for intervening because the question which I shall ask relates to Part I which, I appreciate, he has passed. My reason for asking it now is that I do not propose to trouble the House with a contribution to this debate because I hope to catch Mr. Speaker's eye in tomorrow's debate.
      Is there any definition in the Bill of a trade dispute? There does not appear to be one in the interpretation clause, Clause 112, and there is no independent interpretation clause to Part I. The reason I ask is that several hon. Members, including myself, pressed the Secretary of State to refer the signalmen's dispute to the Advisory, Conciliation and Arbitration Service and he declined to do so on the ground that it was not an appropriate dispute for that purpose. Will the position be more general and wider under the Bill? I should be grateful for any information which the hon. Gentleman could give. If it is not convenient for him to answer now, perhaps the Under-Secretary of State will refer later to the point.
      Mr. Booth: I am sure that the definition of a trade dispute is the same as that which we used in the Trade Union and Labour Relations Act. I think that there is a cross-reference from a schedule of this Bill to that Act. But I shall check on that and if I am incorrect in any way

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      I shall write to the right hon. and learned Gentleman.
      Part III contains provisions ***or the reform of wages councils, to widen their powers and stimulate progress towards voluntary collective bargaining in those areas of industry where statutory control of wages and conditions is still necessary. My hon. Friend the Under-Secretary of State will want to say more about this subject, but the levels established by wages councils certainly give me no confidence in reliance on this form of statutory protection as a means of solving the problem of low pay.
      It is my hope that the special provision for wages council industries—Clause 88 and Schedule 10—will be extensively used by independent trade unions to raise the standards of their members in wages council industries. This provision will enable them to make a claim to ACAS if an employer is paying less than the minimum negotiated with other employers in similar circumstances.
      Clause 88 and Schedule 10 also contain provisions about the extension of terms and conditions which form an important part of the Government's measures to help the low paid and to extend collective bargaining. These provide for claims to be made to ACAS where an employer has workers employed on terms and conditions less favourable than the general level observed by other employers in the same industry, in the same district, and whose circumstances are similar. This is in essence the same right that the fair wages resolution gives to employees on Government contracts.
      Mr. Barney Hayhoe(Brentford and Isleworth): Can the hon. Gentleman give the estimate made of the cost to industry of Schedule 10? He gave a global figure and broke it down a little. Will he give the breakdown for Clause 88 and Schedule 10?
      Mr. Booth: No, I cannot give a breakdown, but I can tell the hon. Gentleman —I know of his deep interest in the matter—that we have discussed this provision with the CBI and the TUC with a view to finding out their ideas about its impact. I will break confidence by saying that we had very different estimates about what its effect would be. We have not been able to give a break-
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      down because it would involve a large number of assumptions being made about interpretations which will be given by tribunals and about the degree of confidence of trade unions in seeking to use this as a means of raising the standards of their members.
      Part V of the Bill—
      Mr. Dudley Smith: I am surprised that the hon. Gentleman has not mentioned, under Part IV, Clause 101, which transfers from local authorities to the Department of Employment the enforcement functions and licensing functions in the Employment Agencies Act. What is the reason for this? I understand that there has been no consultation on this matter with the local authority associations.
      Mr. Booth: My hon. Friend the Under-Secretary of State wished to deal with that question, but we in the Department want to make this a centralised function because of other responsibilities which we believe will fall on the Government in relation to employment agencies.
      On the aspects of the Bill which deal with the question of the handling of redundancies, the Bill requires employers to consult representatives of recognised trade unions about all redundancies and to provide them with all relevant information. Consultations must begin at least three months in advance of redundancies which involve 100 or more employees over a period of three months and at least two months in advance of redundancies which involve 10 or more workers over a period of one month.
      Employers must also give similar periods of notice to the Secretary of State so that necessary plans for redeployment or retraining can be made by the Manpower Services Commission and its agencies. If there are special circumstances which make it impracticable for an employer to comply with the requirements, he has a duty to take whatever steps are reasonably practicable in the circumstances.
      The Government attach the greatest importance to these provisions, particularly in the present circumstances, when redundancies are unfortunately all too common. They implement, and indeed, go well beyond, the recent EEC Directive on Collective Dismissals, in the shaping of which United Kingdom representatives

      43
      played a full and constructive part during the discussions in Brussels.
      Quite apart from our EEC obligations, we think it right and necessary to legislate on these lines. Advance consultation with the unions and advance notification to the Department are good employment practices and are already accepted as such by many employers. However, there are still some who apparently think it right to declare redundancies at very short notice or even with no notice at all, with little regard to the hardship and worry that this inevitably causes.
      Now that the proposals have been published in the Bill, I hope that employers will not wait for them to become law but will put them into practice at once if the need arises. By doing so they will ensure that the problems of redundancy are fully explored in advance and dealt with in a sensible and humane way.
      Before leaving the subject of redundancies. there is one other point to which I should refer. In the course of his Budget speech the Chancellor of the Exchequer mentioned that the Government propose to take powers to pay a temporary employment subsidy. The scheme would be used to alleviate some of the effects of high unemployment in the worst hit areas. We hope that in the event its use will prove unnecessary. It is, however desirable to provide for a short-term subsidy to be offered to a firm which is prepared to defer redundancies in order to provide an opportunity to initiate arrangements for retraining or for other possible action to facilitate employment.
      The Government intend that the scheme should apply only in respect of workers who would otherwise be unemployed or who would displace other workers. It is therefore proposed to restrict the subsidy to development areas. Therefore, we shall bring forward in Committee a provision which will amend the Employment and Training Act 1973 so as to empower the Government to operate the scheme. Consultations are already in progress with the CBI and the TUC to work out the details.
      I turn to Clause 99 which deals with people picketing. This is a declaratory provision. In other words, it does not alter the existing law as established by the
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      House of Lords in the recent case of Broome v. Director of Public Prosecutions. It does, however, put it beyond doubt that the rights of pickets include the right to exercise persuasion on other people by peaceful means short of obstruction, as well as the right to attend for that purpose at any place other than a person's home. This clause makes no change in the position as regards the stopping of vehicles. That position is not entirely satisfactory, because whereas pickets usually have a reasonable opportunity to communicate with people who approach on foot, it is much more difficult. if not impossible, for them to do so in case of people in vehicles. Consequently the right of people picketing may be made ineffective in a way which can hardly have been foreseen when the law on picketing was first framed.
      We have given a good deal of thought to the possible ways of dealing with the problem. There have been discussions both with the TUC and with the police organisations. However, it has not so far proved possible to find a solution which meets the legitimate needs of pickets without causing serious difficulties for the police. Clause 99 goes as far as the Government think is right at present, although we shall continue to study the problem and keep it under review.
      Mr. Ian Percival: The Minister has said that Clause 99 was designed to clarify the law. Can he tell us what it means? Can he give us an example of conduct which might be said to be in doubt now and which will be made clear by the Bill? I am blessed if I can. Can he give us an example of something each side of the line supposed to be drawn by these provisions?
      Mr. Booth: I am certain that this is a matter which will be debated in Committee. My understanding is that the case to which I referred established quite clearly that there was the right to attend at a place for the purposes of picketing and peacefully communicating. What was thrown into doubt was the extent to which there was the right to carry out peaceful communication. I assure the hon. and learned Gentleman that the intention of the clause is to do no more than to make it absolutely clear that there is a right peacefully to communicate, short of obstruction. That is the aim of the clause.
      Mr. Leslie Spriggs(St. Helens): I am not asking my hon. Friend to interpret the law as he intends it to be when the Bill passes on to the Statute Book. However, I wonder whether the Bill will clarify the position of the farmers who caused an obstruction on the highways and the fishermen who obstructed the free passage of shipping into our ports.
      Mr. Booth: I do not believe that the Bill will clarify the position in any way whatsoever. One may have views whether an attempt to stop a vehicle for two minutes can be regarded as an obstruction and whether holding up the entrance to a seaport for 24 hours may be similar action. As I understand the position, the Bill does not help us to solve that problem. We shall have to continue to examine the way in which we can reconcile our law on obstruction with the right to picket and peacefully to communicate.
      I should like to draw the attention of the House to the position of staff employed in Parliament. Parliamentary staffs have not previously been covered by legislation of this kind. I am sure, however, that the House will agree that it would be indefensible if, in matters covered by this legislation, parliamentary staffs were in any less favourable a position than staff employed by a Government Department. We have been giving special consideration to their position, in consultation with the authorities of both Houses. I am able to give the House a firm assurance from the House authorities that they will ensure that, as far as is constitutionally possible, the staff here are treated similarly to civil servants in these matters. If it were the wish of the House that this undertaking should be embodied in a formal way, we would see how this might best be done.
      When examining this problem I was deeply concerned to find that the 1812 House of Commons (Offices) Act still applies. That Act gives the Serjeant at Arms and the Clerk of the House power to dismiss staff without notice, with no redress or appeal. I am certain that it will not be the wish of any hon. Member of this House that that position should continue if it is within our power as legislators—as I am sure we shall find it to be—to deal with it.
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      Clause 100 tackles the problem of those denied unemployment benefit because of the grade, class and financing rules, when they are laid off due to a strike at their place of work. At present, if somebody is laid off as a result of a strike at his place of work, he has to prove that he is not participating in the strike, is not financing the strike, is not directly interested in the strike, and is not of the same grade or class as somebody who is participating, financing or directly interested. He has to prove all that in order to obtain unemployment benefit. This has resulted over the years in a growing number of cases in which great resentment is felt by people who are laid off, due to a strike, through no fault of their own, and are denied unemployment benefit. The abolition of the financing test and of the grade or class test was recommended by the Donovan Commission and has been the policy of the Labour Party for many years.
      Many hon. Members will have examples from their own constituencies of many labourers who have been laid off and have received no benefit because one of their number had retained dual membership of a skilled union to retain benevolent fund rights and where it was held that because he was financing a strike, by paying trade union contributions, all others of the same grade or class —that is, all labourers—should also be denied unemployment benefit. We propose to remove these tests from our law, and I believe that by doing so we shall solve a long-standing problem, which has caused great resentment and a great sense of injustice.
      Finally, I draw attention to Clause 113, which makes it possible for the protection afforded by the Bill to be extended by order in council to oil rigs and other offshore installations. I know that a number of hon. Members who are conversant with the conditions and the industrial relations position on oil rigs are anxious that this provision should be in the Bill.
      Although the Bill is primarily concerned with employment protection, it has wider significance. It is the clearest possible evidence of the Government's firm commitment to the social contract, which in our view remains the only

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      realistic policy for containing inflation. Like the legislation on sex discrimination and pensions which is already before the House, the Bill is designed to remove inequities between different groups of workers. Many of the rights which it proposes to extend to all employees have been taken for granted by most of those in white-collar employment.
      Another of the Bill's aims is to extend collective bargaining to areas other than pay. This is entirely consistent with the guidelines for the social contract.
      Finally, the provisions about disclosure of information complement those in the Industry Bill, while the development of planning agreements will combine with the proposals in this Bill to give workers, through their chosen representatives, a more effective say in decisions which vitally affect them.
      In all these ways the Bill fits in with the Government's social and economic policies, and forms an essential part of them. It derives from the experience, problems and needs of the men and women who work in the industries and services of our country. By the Bill we can render a service to those whose labour creates the wealth of the country. For that reason above all others I commend it to the House.
      Mr. Deputy Speaker (Mr. George Thomas): Mr. Speaker has selected the amendment in the name of the official Opposition.
      4.13 p.m.
      Mr. James Prior: I beg to move to leave out from "That" to the end of the Question and to add instead thereof:
      "this House whilst recognising that parts of the Employment Protection Bill give legislative effect to good industrial practice, declines to give a Second Reading to a Bill which makes no attempt to establish a fair balance between the rights of management and unions, adds a heavy burden of cost without proper consideration of how it should be shared by employer, employee and State, and takes no account of the particular problems of small businesses."
      I wish to start by saying how sorry we are that the Secretary of State for Employment is not here and, on behalf of the whole House, to wish him a complete and speedy recovery. As the Minister of State pointed out, the Secretary of State
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      is the author of the Bill. I hope that he will find some enjoyment, if not complete enjoyment, in reading in his bed the Official Report of this Second Reading debate.
      In introducing the Bill, the hon. Gentleman has shown his customary good manners and helpfulness. I hope he will not take it amiss if I say that I hope his right hon. Friend will be back for the Committee stage, when I hope he will take account of what we say.
      The Bill is very complicated. The only people who should be congratulated on it are the parliamentary draftsmen, because, although it shows signs of hasty drafting, it must have been a mammoth task to produce a Bill containing 115 clauses and 16 schedules. My right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton) would know all about that task.
      One example of hasty drafting concerns matters for the Industrial Tribunal, which are spread over 10 different clauses. It would have been greatly for the convenience of those who have to interpret the Bill if those matters could have been consolidated in one clause.
      The Bill has been introduced very late in the Session. I cannot remember a Government introducing a Bill of this importance and size so late and expecting to get it through by the end of July, with perhaps a little left for the spill-over after the recess. As the hon. Gentleman pointed out, amendments are now necessary as a result of the Budget proposals on retraining and keeping in employment those who would otherwise be put out of employment over the next few months. There will be amendments to Clause 47. and the hon. Gentleman has already said in answer to my hon. and learned Friend the Member for Southport (Mr. Percival) and Basingstoke (Mr. Mitchell) that there will have to be lengthy discussions in Committee. When my hon. Friend the Member for Basingstoke talked about the maternity clause, I wondered whether we should spend nine months in Committee considering it if we are to bring some sense to these matters.
      Have we the time to do all this? What are the Government's proposals in this respect? It brings Parliament into disrepute when we cannot give proper consideration to such a Bill. We shall not

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      want to filibuster on it, but it lends itself to enormously long discussions on intricate matters. Parliament does not do itself justice if it just skips through a number of clauses because it wants a Bill completed by, say, the beginning of July so that the Bill can go to another place. That is not the right way to tackle such legislation.
      The Bill could have formed a number of Bills of reasonable length. That would have been a much more suitable way to introduce the measures that it embodies.
      Our amendment says that no attempt is made
      "to establish a fair balance between the right of management and unions".
      The Bill is throughout concerned with the rights of trade unions and not enough with the responsibilities that they must shoulder as well. As trade unions are now such an important part of our economy and State, they must accept responsibilities as well as rights. That is well brought out in the Liberal amendment, which points out that they should honour their obligations under the social contract before the Government introduce further legislation as part of their undertakings under the social contract.
      When the hon. Gentleman asks what obligations we wish to see imposed, our reply is that at present there are no obligations on unions to avoid strikes, keep to contracts, respect the public interest, and promote greater efficiency through increased productivity, more flexible trading methods, greater mobility of labour, and so on. None of those is an obligation which automatically flows from what is in the Bill.
      A well-known labour correspondent, John Elliott of the Financial Tunes, described the Bill as—
      "a bonanza for the unions with hardly one measure which pleases any employer."
      When we discussed the article at Question Time on Tuesday, the Secretary of State for Employment tried to make out that that comment was contained in a headline and was not necessarily a reflection of what John Elliott felt. As no doubt the right hon. Gentleman has since discovered, the comment was firmly contained within the article.
      Clauses 11 to 16, which deal with recognition rights of unions and which allow
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      unions to refer a recognition dispute to ACAS, whereas an employer cannot, are one example of the balance not being fairly struck between employers and trade unions. We shall wish to change that in Committee to make it possible in those circumstances for an employer to consult. We shall also wish for ACAS to have a time limit within which to finish it, and we shall try to write into the Bill that there shall be no industrial action whilst an inquiry is going on. Those are constructive measures that we shall try to write into the Bill.
      Another matter of great concern to the Opposition and to many people outside relates to Clause 103 and Schedule 13, in which the right to appoint safety representation is given only to the recognised trade unions. The Opposition and many people who are members of trade unions, as well as the 50 per cent. of workers who are not members of trade unions, feel particularly strongly about the clause. We all feel that safety is too important a matter to be used to assert sectional interests. That is the only way in which one can interpret what is behind the Government's attitude. If I had to find a more suitable name for the Bill, I should call it not the Employment Protection Bill but the Trade Union Benefits (No. 2) Bill.
      We should take a moment to discuss what happens when we shift the balance of power between employer and employee and between the House and people outside the House. That is an important matter for the country to think about. There is no doubt that power has shifted from this place and from the employers and into the hands of trade unions. I do not mind power shifting from employers to trade unions provided that there is a balance, but I object to power shifting from this place, because this is where real power must always reside if we are to preserve democracy.
      All the actions that are being taken by the Government result in the shifting of power to the trade unions and away from Parliament. The shift in the balance of power from Parliament must concern us all. It is a shift of power resulting not only from legislation but from inflation. With inflation running at 21 per cent., 22 per cent., 25 per cent. or 27 per cent., combined with the Government's legislative action, there is not much chance of our keeping the freedom of which the

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      House has for so long been the main centre in the world.
      We were told by the Minister of State that the Bill is a further instalment in the social contract. If I have his words down correctly, he said that the social contract was the only realistic policy for containing inflation. For anyone to go on saying that the social contract is containing inflation when inflation is now at a higher level than it has ever been and is known to be going higher as the year proceeds, is to perpetrate a cruel deception on the public. Anything which makes the public believe that the social contract is working can only be a deception which is bound to have a reaction. Such an attitude suggests a doom-laden complacency because it prevents the Government from taking action which they should, and know they should, be taking.
      With unemployment rising at a seasonally-adjusted rate of between 30.000 and 40,000 per month, and prices going up at the rate they are, for a Minister to say that the social contract is the only realistic policy for containing inflation shows that he and the Government do not live in the same world as the rest of us.
      I shall now say a word on the subject of unemployment. None of us in Opposition wishes to see unemployment go higher by one man or woman. The attitude which we have adopted towards unemployment is a good deal more responsible than was the attitude adopted by the Labour Party when it was in Opposition in 1971–72. We accept that in so far as inflation is allowed to continue unchecked and increased wages are allowed to be granted unchecked, as they are at present, unemployment is bound to go higher. It is true that one man's wage increase is another man's unemployment, and that is now being brought home to many people throughout the country. It is a policy that we deplore.
      Looking back over the years, with all the difficulties with which the previous Conservative Government were faced, I make no apologies for the stand we tried to take in February 1974. If the country had come with us in February 1974 we should not have got into the mess that this lot have got us into. [Interruption.] Before hon. Gentlemen get too excited about what they know to be true, I will continue my speech.
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      The amendment refers to the Bill adding a heavy burden of cost. The Minister of State told us that the cost would be about £100 million plus. He broke that down into £5 a year or lop a week per person—I am not sure which figure he chose. He implied that the figure was not much—£100 million. The question is whether we can afford that in addition to everything else for which we are having to pay as a nation. Is this the right time? Can we afford to make universal nearly all the benefits which are accepted practice by the biggest and best of our industrial firms? I do not doubt that in time we should all wish to see many of these benefits brought in —the maternity benefit, the guaranteed week payments and so on—but there is a case for saying that these should be met by the State and not by the employer or the employee. In many Common Market countries those benefits are the responsibility of the State. The House has not at this time decided what is the responsibility of the employer, the employee or the State in these matters, and we should do that before we decide to put the responsibility on to the employer, as the Bill does.
      Members opposite must understand that the angry reaction of employers to the Bill stems not so much from one particular item or one particular increase in cost, but from an accumulation of irritations with the Government over a period. I think that that irritation goes back and extends to more than one Government. Government legislation is now pouring through the House. It is ill digested and ill thought out. Whether it be capital transfer tax or the measures in the Bill, a great deal of legislation is proving too much for a large section of industry to digest. Small firms, which my hon. Friend the Member for Basing stoke has already mentioned, are of particular concern in that respect. I am glad that we have referred to small businesses in our amendment. I think that the Liberal Party would agree with that approach.
      I think that it would be right at this stage to set a limit to the number of employees so that under a given number the Bill will not operate. It may be argued that it would be wrong, as it were, to make second-class citizens. However, I do not believe that by adopting that

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      approach we would be making second-class citizens. There are an enormous number of people who prefer to work for small firms and to work for a boss who knows all the men and women by their Christian names. They can leave work when they have to and they can work extra hours when necessary. In small firms there is a different relationship between employee and employer and a great many people are employed in that way. A great many people prefer to be employed in that way. We need to increase the number of small businesses and small firms and not to discourage them.
      I suggest that my hon. Friends and myself should table an amendment in Committee to exclude small businesses. By such an amendment we would seek to exclude small businesses with 100 or fewer employees from the operation of this measure at this stage. I think that would meet with the approval of all employees in small businesses as well as employers.
      Mr. Ivor Clemitson: Would the right hon. Gentleman advocate a similar lower limit for the Redundancy Payments Act and for the unfair dismissal provisions of the Trade Union and Labour Relations Act?
      Mr. Prior: No, I would not do so for those measures. Both those measures—and I am glad that the hon. Gentleman pays tribute to them—were introduced by Conservative Governments. The Redundancy Payments Act and the unfair dismissal provisions were both the result of Conservative Governments. I am pleased to support that.
      Mr. Clemitson rose —
      Mr. Prior: No, not again. I must get on. The Redundancy Payments Act 1965 was introduced as the result of Conservative Government action in 1964 for which Lord Blakenham was responsible.
      The Under-Secretary of State for Employment (Mr. Harold Walker): Will the right hon. Gentleman correct that statement? Does he recall that the Redundancy Payments Act 1965 was introduced by a Labour Government?
      Mr. Prior: It followed the White Paper that was introduced by a Conservative Government. The only trouble was that we did not have the time to put the
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      White Paper into operation. The Act was entirely based on the proposals put forward by Lord Blakenham when he was Minister of Labour.
      I now turn to the information clauses, to which we have no objection. They are the same clauses, with perhaps a little elaboration, as were contained in the Industrial Relations Act. I have in mind Clause 56 of that Bill. They were also set out in not very great detail in the disclosure of information clauses in the Code of Industrial Relations Practice. We should give employees every possible help so that they know what is going on in their firm or organisation. There has been a great change in the attitude of industry to these matters in recent years. I would like to see that change extended in every possible way and to the extent that the clauses guarantee security, where necessary, for employers. That also applies to employees or trade unions for the purposes of collective bargaining. I am delighted to go along with that.
      I turn to what I believe is a contradiction in Government policy. As I understand it, Labour Members and some trade unionists outside the House wanted to destroy the Industrial Relations Act because they maintained that industrial relations and the law were totally different. They claimed that the law had no part to play in industrial relations. The Bill introduces the law in many areas where we have so far proceeded in a voluntary manner. I grant that it has a trade union bias, but it introduces the law in that respect.
      I have come to the conclusion that it is not so much that Labour Members or trade unions dislike the law, as that they merely dislike some laws and that they dislike Tory laws—[HoN. MEMBERS: "Yes."] That is what it is. We now know the position from the reaction of those on the Government benches. We now know what it is they dislike. The hon. Member for Tottenham (Mr. Atkinson) has said that there are two sorts of law—namely, ordinary law and political law. He claimed that we do not have to obey political law. I think that the position is now clear.
      The extension of statutory regulations into many areas reserved for free collective bargaining is in many respects a retrograde step. Many matters such as

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      guarantee payments, maternity arrangements and time off for trade union activity would have been better introduced through codes of practice rather than through writing them into the law. Traditionally they are matters for voluntary arrangement and it would have been best to leave them for voluntary decision.
      I have received a letter from a small business man about the maternity arrangements that are proposed in the Bill. He says that the reinstatement provision cannot be made to work in a small company where it is necessary to train only one order clerk or one wages clerk. He points out that if such a person goes on maternity leave it is necessary to train someone else, and that a small company cannot train someone for only a few months. It is necessary to have a continuity and regularity of employment and the Bill will militate against that as regards maternity arrangements. If the arrangements are left as they are, there is a good chance that large firms, where many women are employed, will react against the employment of women. That could decrease the number of jobs that are available for women. On this subject, I have received a good deal of information and many representations.
      I turn briefly to Clause 1 and the Advisory, Conciliation and Arbitration Service. I say straight away that we support the service. We wish it well, and it will not be our intention to disband it when we return to office in the near future. We shall support the service but we think that the terms as laid down are much too narrow and much too concentrated on collective bargaining. We believe that the service should concern itself with the peaceful settlement of issues that arise between employer and employee, and the safeguarding of individual rights of employees who are threatened by employers, trade unions or fellow employees. The service is much too narrow and too much based on collective bargaining.
      I hope that Labour Members will pay attention to the fact that an employer will not be able to submit a recognition dispute to the Advisory, Conciliation and Arbitration Service. That may well result in employers not wishing to use ACAS and not having a great deal of
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      confidence in it. In trying to build up a proper conciliation and arbitration service the organisation involved must have the respect and full authority which only a totally independent authority can command.
      In regard to the composition of that body, I am not certain we need three academics or three outsiders. The matter should be examined in Committee. I do not know whether it is a good practice to have its chairman appointed by the Secretary of State or indeed to have the the service appointing its own chairman. Again, we should like to examine that matter in Committee.
      I hope that employers will put their weight behind ACAS and appoint top-grade people who are well known in industry and in the country generally. We shall give further attention to that matter in Committee. We wish ACAS to go ahead, and we hope that it will turn out to be successful.
      I turn to the Central Arbitration Committee, which will replace the Industrial Arbitration Board. Clause 88 deals with the extension of terms and conditions and gives the right to a trade union to take a claim to the Central Arbitration Committee. The CAC can make an award and the employer must submit to it. But what happens if the union concerned fails to observe it? I see nothing on those lines laid down in the Bill, and we should like to hear the Government's views.
      I should like to examine the relationship between the CAC and ACAS. Suppose the Government lay down a pay policy. Can ACAS tell the CAC what to do? What powers has ACAS over CAC in these matters? Perhaps the Minister will give us that information.
      Many of the new benefits are to be enforced by the Employment Appeal Tribunal under Clause 77. That tribunal will have High Court status. My hon. and learned Friend the Member for Southport will be interested to compare the clause which sets up the new body with the clause in earlier legislation which set up the National Industrial Relations Court. The words have been juggled around a little, but they are absolutely identical. I presume the words have been juggled around to conceal something,

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      although I am sure Labour Members would not be confused or misled by that.
      In trying to insist that so many of these provisions favourable to the trade unions have statutory backing to ensure that they are enforced, the trade unions may be hoist with their own petard. In order to achieve that aim the Government are setting up almost the same pieces of machinery as existed in the Industrial Relations Act. From the Government's point of view it might have been wiser to have relied on codes of good industrial practice rather than to try to put so much into statutory form.
      There are a number of useful measures for employment protection in the Bill, but the whole majesty of the law has now been invoked. We do not think that this is the right time to take that step, nor do we think that the Bill is the right way in which to act. However, I assure the Minister that we shall try to improve the Bill and that we shall be constructive in our discussions in Committee. But I feel that the Bill shows the wrong mentality. It is conservative with a small "c", in its worst possible form. The Bill contains nothing which will increase production or which will create a larger cake for the nation to share. There is nothing in the Bill which will make the rewards of hard work and greater production really worth while. There is nothing to deal with the great problems of job protection or with unemployment. There is nothing to deal with the problems of overmanning or with the problem created by school leavers—a problem which will be particularly severe this summer.
      On Saturday the Secretary of State, commenting on the unemployment figures, said:
      "I read these figures with horror and with shame. These are figures we have to have before us every day of our political lives. I want to see every instrument available at our command to deal with unemployment here and now."
      Perhaps the greatest problem we face is that of overmanning—for example, how to get people out of industries such as the car industry and to put those people into other industries. We must learn how to carry out that process without causing bitterness and loss of dignity that comes from losing one's job. This cannot be done easily, but nor can it be done in
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      the long run by pushing more and more money into an industry so that jobs can be maintained.
      Looking back over the years, I believe that we had the same problem with Upper Clyde Shipbuilders. I believe we should then have said "We shall put more money into the setting up of new industries on Upper Clyde and shall train shipyard workers to go into those industries". We should then have gone on to say "We shall take a year or two, we shall go on paying you in your job during that time —but then we want you to move". That is a much more positive way of setting about the matter than by pushing out more money to prop up an old and dying industry or an industry which is suffering from an overmanning problem, as many of our industries are. I do not think we shall solve that problem by backing outdated industries or practices. The same considerations apply to the debate in the House recently when we discussed the Government's proposals for the docks.
      I turn to the subject of school leavers. What is the alternative for them this summer? A further year at school kicking their heels because they cannot get a job will not make them into very good citizens. The alternative will be the dole queue or an unsatisfactory job. What are we doing about the situation? Although we are prepared to put £1 million a day into British Leyland, last year on Community Industry, which seeks to train only 1,500 young people, we spent £1·6 million for the whole year from Government resources.
      It is not good enough to look at the problems of employment protection on the narrow, conservative lines which the Government have adopted in this Bill. The Government are spending £1 million a day to prop up British Leyland and will spend £100 million as a result of the provisions of this Bill—and yet nobody can say that the Bill will preserve a single job. We shall just make it less easy for the bad employer to sack somebody unnecessarily. The legislation will not create any new jobs, nor will it make the country a fitter or more prosperous place for our citizens.
      Because we believe that the Bill is ill-timed and does not attempt to deal with the problems that face our society, we shall vote on our reasoned amendment this evening.
      Mr. Deputy Speaker (Mr. George Thomas): A very large number of hon. Members wish to take part in the debate, and I hope that accordingly hon. Members will be considerate in making their contributions.
      4.50 p.m.
      Dr. Edmund Marshall: I shall not attempt to follow the right hon. Member for Lowestoft (Mr. Prior) in his wide-sweeping remarks about the general employment and industrial situation. Instead, I wish to concentrate on some of the practical details of how the provisions of two clauses of the Bill will affect the ordinary day-to-day affairs of the people whom we are sent here to represent.
      I want to give a warm welcome to the Bill, especially to Clauses Nos. 57 and 58, which will give new rights to employees whose employer becomes insolvent. As my hon. Friend the Minister of State has said, under Clause 58(2) it is proposed that payments should be made out of the Redundancy Fund to meet arrears of pay due to employees of a bankrupt firm and also any payments in lieu of notice and holiday pay which are still due to them.
      The urgent need for legislative provisions such as these was fully demonstrated to me by an incident which occurred in my consituency as recently as last December and which my hon. Friend the Under-Secretary of State will remember well, as he and I discussed it at that time. He is one of my geographical neighbours, and the incident to which I refer occurred within the Doncaster metropolitan borough at Thorne, a town in my constituency, where there is a light industrial estate in Coulman Street which has been developed through the efforts, over recent years, of local authorities, industrial development agencies and the regional offices of Government Departments.
      In the middle of 1973 one of the factories on that estate was occupied by a firm called Humberside Frozen Foods Ltd., a food processing firm, which provided valuable employment for about 40 local people, most of them women. I note that this firm would, therefore, be regarded by the right hon. Member for Lowestoft as a small firm, and in his view the kind of problem which I shall describe
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      is one that should not be tackled by the Bill. However, without any warning at all, on Wednesday 18th December 1974 all the employees of Humberside Frozen Foods Ltd. received summary notices of dismissal. I have one of those notices with me. It is very brief. It reads:
      "It is with very great regret that we have to inform you that as from today's date this factory will cease activities owing to circumstances beyond their control. Arrangements have been made with the Social Security, you should report at the Job Centre, Thorne, tomorrow…with all your pay slips at 11 a.m. All assistance possible will be given through this office."
      That happened exactly one week before Christmas Day. The 40 employees found themselves completely out of work. They had no pay in lieu of notice; there was no payment of holiday pay due to them; there was no payment of wages which were already outstanding. It had been the practice of the firm to pay wages in the week following the week to which they were related. Therefore, arrears were considerable. The total debts owing to one lady employee were £111·89. That money was cut off from her. Because wages were paid in arrears it was not possible for any employee to claim unemployment benefit for the week following dismissal. Most of the employees, who, as I have said, were married women, found that they had no entitlement to supplementary benefit because their husbands also were, happily, in employment.
      However, this blow could not have fallen at a worse time of the year, with all the expenses arising for these families at Christmas time, particularly on presents for the children.
      Many of the employees came or wrote to me, and I have here their letters asking for advice and assistance. It was distressing to have to tell them that as the law stood at that stage their only means of redress was to seek repayment of the debts due to them by notifying the liquidator of the firm and seeing that their names were correctly included on the list of creditors. As the first meeting of creditors was not until 14th January 1975 this advice was cold comfort.
      I was later informed that the machinery which was owned by Humberside Frozen Foods Ltd. and operated at this factory had been hastily removed overnight from the premises. The premises were rented from, and, thereforefore, owned by, the

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      local authority. There were therefore no assets at the factory for the liquidator to realise. I have not been able to find out exactly who was responsible for that situation, but I condemn the whole manoeuvre as sordid and disgraceful. It left the employees as the completely innocent victims.
      If the proposals in Clause 58 are enacted, I am given to understand that the general intention is to meet the difficulties of people who were in the same sort of position as my constituents. There is the danger that the enactment of these provisions may encourage other unscrupulous employers to do this sort of thing, but at least we shall have some protection for employees who find themselves suddenly out of work in these circumstances.
      I hope that in his reply my hon. Friend will say a little about how exactly these provisions would have operated in the case to which I have referred.
      Clause 58 says that application has to be made to the Secretary of State by the employee. Does this mean that it will be possible for an employee to do this at any office of the Department, and will officers of the Department go out of their way to explain to employees in this sort of situation exactly what their rights are for making application?
      I am also a little uncertain as to the exact meaning of Clause 58 (7), which refers to cases
      "where a trustee in bankruptcy or liquidator has been or is required to be appointed …".
      It also says:
      "The Secretary of State shall not entertain any applications for a payment…unless he receives a statement from the trustee in bankruptcy or liquidator …".
      I am a little worried that that subsection may lead to some delay before the kind of payments to be made in accordance with the clause may be made to the people who are applying for them.
      I hope that when my hon. Friend replies he will be able to show exactly how it is intended that these provisions should operate. I hope that he, as I, will give all possible speed to the Bill so that the kind of situation which I have described in my constituency cannot occur again.
      5.0 p.m.
      Mr. Cyril Smith: I share the condemnation which the hon. Member for Goole (Dr. Marshall) so graphically outlined, but I am sure that he will forgive me if I do not follow him except to observe that there was a time in his political career when he strongly supported regional government. He has just demonstrated the need for it.
      This Bill is peculiarly named—the Employment Protection Bill. No Bill was ever more wrongly named. If the Bill has an effect on employment at all, it will certainly not protect it but is more likely to do the opposite. If the Government wish to protect employment, they must do something about the ridiculous, excessive and highly inflationary wage settlements now being awarded and negotiated I appears that 30 per cent. is the order of the day this year, and I have read that one union leader is talking of claims averaging 50 per cent. next year. My comment on that type of suggestion is "How daft can we get?"
      Much of the Bill is designed not to protect employment but to strengthen the hands of the already over-powerful trade union movement. One has only to look at Clause 100 and Schedule 13 to see that. This legislation is not likely to contribute to good industrial relations, and in many circumstances it may sour them.
      The right hon. Member for Lowestoft (Mr. Prior) referred to the introduction of law into industrial relations as a consequence of the Bill. At that point in his speech, as indeed at others, I was saying "Hear, hear". I remember over the last 12 months some of the bitter crticisms by the Minister of State of the 1971 Industrial Relations Act. I remember his harsh and grossly unfair criticisms of the judiciary and his expressed hatred, almost to the point of eccentricity, of judges interfering or being involved in industrial relations. But Schedules 1 and 5 do exactly what he criticised. That is hypocrisy. It would serve the Government right if the judges, refused to serve in this instance. If they are called upon, as they are under the Bill, to serve in industrial relations matters and to arbitrate, I hope that on this occasion they may expect the support rather than the venom of some Ministers.

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      We need to get industrial relations on a firm, fair and proper footing. This implies worker participation. but I would stress as I have done many times before that there is a great difference between worker participation and union participation. The sooner the Government understand that they are not the same thing and reflect that understanding in legislation the better chance we shall have of getting industrial relations on a proper footing.
      To do this, co-operation is required from management as well as from unions. To introduce, especially at this time, a Bill which is so one-sided, which gives help only to the unions, without any employer rights or protection, is ludicrous stupid, provocative and, it I may use the word again, daft.
      Many employers, especially small firms, will soon have to consider appointing someone to ensure that they do not break the law. This is not a flippant remark; I speak as someone who employs 70 people. We are being inundated with so much legislation that small firms cannot cope. It is all right for companies with 200 or 300 employees, who have accountants and legal advisers, and I am not arguing that small companies should not have to comply with the law. But we should surely be able to absorb one new Act before another drops on our desks. We are required at times, to put up notices saying what our policy is, on health, and safety for example, to be followed by another the very next month.
      We are reaching the stage at which we are frightened that unless we have a legal adviser we shall be sued for breaking the law when we had not known that we had broken it. This is the worry of small companies—not that they are opposed to the legislation or object to having to comply with the rules like employers who employ large numbers. They object simply to the speed and complexity of the process. I hope that the Government will understand that this is a real problem for employers with small numbers of employees—a phrase that I prefer to "small employers".
      The Liberal Party believes that people should be given time off for public service as provided in Clause 53. I doubt whether that is so much of a problem as to require legislation, and I should like
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      some convincing when it comes to my own part of the world. There is no shortage of Labour candidates in my constituency or in adjoining constituencies. However, if the Government can convince us of the need, we shall not oppose the clause. We simply question this provision on the ground that we should not legislate unnecessarily.
      Of course we welcome the provisions for proper payments for periods of pregnancy and maternity, but we are entitled to ask whether this is the responsibility of the employer or of the State. What do married women in industry pay their insurance stamps for? What does the employer pay his proportion for? While I and my party welcome the idea of women being entitled to proper pregnancy leave and certainly to proper payment for the period of maternity, we question whether this should be the financial responsibility of the employers rather than the State. Clause 44 is, therefore, fraught with difficulties for employers, although on balance I commend it and I realise that it can be considered in Committee.
      I have every sympathy with Clause 22, relating to guarantee payments in the event of lay-offs, but I should have more sympathy with it if I were satisfied that the Government intended to assist the textile industry. In its present circumstances, that industry must be particularly vulnerable under the clause. If people are prevented from working through no fault of their own, simply because the work is not available, they should be paid for the period when they cannot work, but we are entitled to ask whether, if the reason for the lack of work is Government action rather than the action of particular employers, the payments should not be the responsibility of the State.
      If the Bill is given a Second Reading, we shall seek to press many amendments in Committee. We shall want to examine Clause 17 on the disclosure of information. I entirely accept, as did the right hon. Member for Lowestoft that on immediate reading the clause appears to be all right.
      I should welcome a clause being introduced by the Government to cover House of Commons staff, because some of the orders and some of the rules which I see

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      being applied here to staff as to Members of Parliament are Victorian in their concept. I am not surprised that the rules were drawn up in the time of Tchaikovsky's 1812 Overture.
      My main criticism of the Bill is not merely for what it does but for what it fails to do. It offers little protection for the lower paid in that it fails to introduce a statutory minimum wage. I listened carefully to what the Minister of State said in introducing the Bill. I take his point. Tomorrow I shall read what he said more closely in Hansard. It may be that when we reach Committee I shall have to temper my judgment.
      As I read the Bill, there is a disgraceful omission. The Government have not included any provision for a statutory minimum wage. The onus is still on people to establish a case rather than their being told "You are entitled by law to, say, two thirds of the national average wage."
      It is disgraceful that a Government who try to kid people that they are concerned about the lower paid cannot do something about introducing a statutory minimum wage. By continuing to ensure a free collective bargaining system without a statutory minimum wage one supports the strong and deserts the weak. In our present inflationary system, the strong survive and the weak get weaker.
      I understand that the Secretary of State has had correspondence with the Low Pay Unit about the possible introduction of a statutory minimum wage. We are entitled to ask the Under-Secretary to refer to the correspondence. I understand that the Secretary of State promised that problems such as those connected with home workers would be alleviated in the Bill and that he talked about the possibility of a statutory minimum wage, but ultimately had to reject it because the Government wanted to retain free collective bargaining and a statutory minimum wage would preclude that. As regards the problem of home workers, we are entitled to ask what happened to the promise the Secretary of State made to the Low Pay Unit.
      The Minister of State agreed that the Bill is yet another instalment of the price that the Government have agreed to pay for what he calls "the social contract"
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      but what I have heard referred to as "the social con-trick".
      A contract implies a bargain between two sides, not one side alone. As the trade unions, or at any rate some of them, have manifestly not delivered their half of the contract, in that there have been excessive wage claims and wage increases have been negotiated more than once in a period of 12 months—the Minister of State said that there had been some wage settlements which he deprecated as going outside the social contract—we suggest that the House should decline to give a Second Reading to the Bill until the unions make their sessionary instalment and prove that they are prepared to meet their side of the social contract.
      The Bill is like a curate's egg. In parts it is good. In others it is hopelessly misconceived. We have reached a stage in our social history where we need to consider where we are going as a nation. In industrial relations we need to unite the nation rather than divide it. Employers with small businesses, the self-employed, small shopkeepers and people like them are getting rather tired of being pushed around by successive legislation. The Bill is one more nail in the coffin. It is geared to increase the powers not of workers but of trade unions.
      Because the Bill does nothing to help the weak, the lower paid and home workers, because it shifts the proper financial responsibility of the State on to the improper responsibility of the employer, because of its timing in relation to the national economy, this evening my colleagues and I will, because our own amendment has not been called—we do not question Mr. Speaker's right in that regard—either be supporting the official Opposition amendment or, alternatively, forcing a Division against the Second Reading of the Bill itself. I suspect that we shall choose to support the official Opposition amendment merely in order to save having two votes.
      If none the less the House should approve the Bill, the House can rest assured that in Committee and on Report we shall be seeking to amend the Bill so that it will be a better Bill. We shall seek to ensure that it helps people rather

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      than unions, that it makes a positive contribution to good industrial relations, and that it becomes what it certainly is not now—a Bill concerned with employee protection in those areas where protection is necessary, and that it concerns itself less with party dogma and far more with making a positive contribution to gettting the country back on its feet.
      5.17 p.m.
      Mr. John Evans: Unlike the hon. Member for Rochdale (Mr. Smith), I wholeheartedly welcome the Bill. It is one of the most important pieces of legislation the House has considered for many years. It will be welcomed not only by the vast majority of the trade union movement but also by many of the most progressive employers. Many progressive employers have conceded more than the Bill sets out to secure for employees.
      I declare my interest in the Bill. Like my hon. Friend the Minister of State, I am a sponsored member of the Amalgamated Union of Engineering Workers, and until February last year I was an hourly-paid shipyard worker on Tyneside. I was for many years a shop steward. Together with many of my colleagues in the trade union movement I fought hard for years to establish in our industry some of the things which the Bill sets out to secure.
      It is incredible that in 1975 in this democratic country we are legislating for such fundamental things as the right to belong to a trade union and the right of a trade union to represent the interests of workers about their wages and their conditions of work at their place of work. It is nonsense to suggest that this will bankrupt industry. We seek to bring democrary into the work place.
      It is of equal importance that we have the next Bill, to which my hon. Friend the Minister of State referred.
      The Bill honours another pledge of the Labour Government. We said in our manifesto that we would repeal the Industrial Relations Act, which was responsible for so much of the bitterness and hatred which were engendered in industry under the last Tory Government. We repealed that Act. We did not often have the support of the hon. Member for Rochdale at that time, so we are
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      not surprised that he will not be supporting the Bill tonight.
      Mr. Cyril Smith: I am rather intrigued by that statement, and I should be glad if the hon. Gentleman could substantiate it. Throughout the election my party indicated that we would support the repeal of the Act. We voted at all stages for the repeal of the Act. What we did not do was support some of the amendments submitted by hon. Members opposite—not amendments to the Act which they were seeking to repeal but amendments to the position which existed prior to the introduction of the Act, such as, for example, on closed shops.
      Mr. Evans: On the few occasions when the hon. Member was present in Committee he often voted against the Government and supported amendments which the official Opposition put forward. if he doubts my word, let him read the Official Report. It i, there for all to see.
      I should like to comment on one or two issues arising from this Bill. The first one, and probably the most important, is the setting up on a statutory basis of the Advisory. Conciliation and Arbitration Service. Anyone who has ever had any responsibility on the shop floor for negotiating on behalf of his fellow workers learns very quickly that one thing that one must do is to settle disputes between employer and worker before they reach the stage of a strike, because it is when a dispute reaches the strike stage that the bitterness, anger and hatred creep in.
      One thing that we have learned over the years, and certainly prior to the Industrial Relations Act, is that the trade union movement welcomed the arbitration service of the old Ministry of Labour. It is essential that we get the ACAS on to a firm basis, and I hope that there will be a wide expansion of this service. I know that the trade union movement will welcome it. I also hope that the employers will accept the words of the right hon. Member for Lowestoft (Mr. Prior) and that they also will support the ACAS. It is essential that we create a new feeling within industry about industrial relations. This Bill will not only protect jobs. If we can get that spirit of co-operation and conciliation which is so essential in industry, we shall promote employment. To achieve this, it is essential that both

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      sides of industry work together with the ACAS.
      The Bill refers to a guarantee payment to the employee, and I confess that I feel this does not go far enough. The principle is sound, and many firms have already agreed to some such arrangement. But I ask the Minister to give some consideration to the £6 a day clause. I ask him to withdraw the word "maximum" and to substitute "minimum". I ask him to bear in, mind the TUC policy of a £30 a week minimum wage. I also ask him to bear in mind that many employers have long ago conceded much higher payments than £6 a day. I suggest, therefore, that the word "minimum" is preferable in this context.
      The other aspect of the Bill to which I wish to draw attention is the question of time off for those who wish to participate in local government and trade union business. I used to be an hourly-paid worker, and I served the local authority and my trade union. I suggest to the hon. Member for Rochdale that it is essential that statutory provision be made in this respect. More and more hourly paid workers find it increasingly difficult to serve on local authorities and public bodies, and this applies particularly to the Labour Party because it has the greatest number of hourly-paid workers in its ranks.
      My only criticism is that the Bill is rather woolly in this respect. Clause 53(4) states:
      "The amount of time off which an employee is to be permitted to take under this section …"
      in that which is
      "reasonable in all the circumstances having regard, in particular, to …
      (c) the circumstances of the employer's business and the effect of the employee's absence on the running of that business."
      With respect to the Minister of State, I say that a couple of buses can be driven through that provision. I suggest that we should insert a stated number of days, as is already done by many local authorities which have employees who serve on other bodies. That would be fairer than leaving this provision which could mean that an employer could say to somebody wishing to serve on a local authority or hospital board "I am sorry; I cannot allow you any time off work because of the effect it will have on my business.'
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      The clause on picketing is not good enough. We must tackle the whole question of the legal rights of pickets. We must accept that in an industrial country there must be pickets in industrial disputes when passions run high and tempers are roused. I ask the Minister to look again at the question of obstructing the highway. A picket must have the right to stop a lorry and put his views to the lorry driver peaceably. He cannot put his views to the lorry driver when the vehicles is going past at 30 miles per hour.
      Mr. Percival: Does the hon. Gentleman mean that the picket should have the right to stop a lorry driver even if the lorry driver does not want to stop and does not want to listen to the picket?
      Mr. Evans: Bearing in mind that the pickets will be at the factory gate, unless the employer goes along with blacklegging intentions and opens the gate so that the lorry can be driven it, it will not be too difficult for the driver to stop the lorry.
      Mr. Percival: Answer the question.
      Mr. Evans: I am saying, yes, the picket must have the right to stop the lorry. He must have the right to put to the lorry driver his point of view about the cause of the dispute.
      I ask my hon. Friend to consider this point. As we are speaking in terms of obstructing the highway, would this apply to a man on a bicycle who is attempting to drive to work and is blacklegging? Hon. Members opposite who have little knowledge of strikes may not know what is meant by the terms "blackleg" and "scab". To a man who works 40 or 45 hours a week those terms are very emotive, and a man who attempts to break a strike is rightly termed a blackleg and a scab. We must get this issue clear in the Bill. We should define what we mean by the word "picketing". I accept that we still have not correctly defined the law on picketing, and I should like that law to be clearly defined.
      Most Governments have attempted to pass some form of legislation on industrial relations. The major mistake that most Governments have made is that they have not consulted, nor have they taken into account the feelings and the views of,

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      workers with respect to whom they were seeking to pass legislation. This Bill does not make that mistake. We have taken cognizance of the views, the feelings and the fears of workers in industry.
      I do not believe that this Bill is a gigantic step forward in industrial relations. The most important aspect of the Bill is that for the first time Parliament has got on to the right road concerning industrial relations. Politicians may find themselves in league with the men and women who work for a living. I hope so. The Bill has been sub-titled "In Place of Strike ". I think that is the best title for this Bill, which will go a long way towards bringing peace to industry—the peace that this country so desperately needs.
      5.30 p.m.
      Mr. Philip Holland: As I am unable to share the euphoric approach to the Bill expressed by the hon. Member for Newton (Mr. Evans), it will probably save the time of the House if I do not take up each of his points in detail before coming to my own observations, though I shall deal with some of his remarks as I go along.
      During the past 12 months the Government have presented a series of Bills with beguiling and totally misleading titles designed collectively to concentrate all power in the hands of the few while progressively destroying the enterprise of the many. All such legislation, whether it be the Trade Union and Labour Relations Act, as amended, the Industry Bill, the Community Land Bill, to come up for Second Reading tomorrow, or the present Employment Protection Bill, contains a sprinkling of "goodies"—I have in mind here what is referred to in the Opposition amendment as giving legislative effect to good industrial relations practice—but the "goodies" are intended to distract attention from the long-term objective of replacing our free collective bargaining system with a system which one can only describe as industrial totalitarianism.
      The Bill purports to be an Employment Protection Bill, but it will contribute, as the hon. Member for Rochdale (Mr. Smith) said, not to an increase in employment but to an increase in unemployment by adding directly to the costs of many small businesses already reeling
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      under the burdens of excessive taxation, high rates and heavy social security payments. In spite of the expressed concern of the Minister of State, every new impost puts further at risk the livelihood of a quarter of our working population currently employed in small businesses.
      The proposals in Clauses 51 to 53 to give employees a legal right to time off for a wide variety of activities at the employer's expense will add considerably to unit costs, while the provisions in Clauses 22 to 29 for a mandatory guaranteed week will be a great stimulus to employers in some of the more seasonal industries to reduce their overall labour force rather than incur the high expense of periodic temporary lay-offs. As my right hon. Friend the Member for Lowestoft (Mr. Prior) pointed out, the right to maternity leave will lead to employment difficulties for women.
      Thus, far from being a Bill for the protection of employment, it will create some unemployment. It will, of course, protect the employment of trade union officials by the provisions made for trade union recognition in Clauses II and 12, the guarantee of time off for union activities at the employer's expense in Clauses 51 and 52, and the strong statutory prejudice in favour of trade union membership in Clauses 47 to 50. As an alternative to my right hon. Friend's suggestion, I suggest that we call the Bill the Trade Union Officials Employment Protection Bill.
      The confidence trick is not confined to the Short Title. In the Long Title it is claimed that the Bill will establish machinery for promoting the improvement of industrial relations. In fact, it will in parts restrict and confine, and ultimately destroy, free collective bargaining over a wide area. Many of the provisions are divisive and will create new tensions in industry.
      Here is but one example. The provision in Clause 11 for any independent trade union to be able to apply to the Advisory, Conciliation and Arbitration Service for recognition, which the service may then make mandatory on the employer, is a negation of the collective bargaining räle. It requires no account to be taken of existing arrangements, perhaps with other trade unions, or of the wishes of the majority of employees. It

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      leave the union free to accept or reject the recommendation but imposes it on the employer without the option and without right of appeal. It opens the door to a growing multiplicity of small unions and increases the hazard of inter-union dispute. It has been described as an open invitation to minority interests to create industrial disruption, and I agree with that assessment.
      Mr. Tom Litterick: Did the hon. Gentleman ever read the Industrial Relations Act?
      Mr. Holland: I am glad the hon. Gentleman raises that point. I find a distinct difference where there is a procedure which is used as a last resort for arbitration by a tribunal, where both sides may state the case fully and where, at the end of the day, if either side does not like the decision it may appeal to the High Court. There is no such appeal system in the procedure proposed here.
      Good industrial relations depend above all on mutual understanding between the two sides meeting as equals in the free collective bargaining procedures. They cannot bloom in a climate of State compulsion. Neither can they prosper when one side is handed all the rights, all the privileges, all the patronage and all the power, while the other side is clobbered with all the responsibility, has none of the rights and has only the manoeuvrability of a tram.
      Not all the Long Title is misleading. In places it admits more openly to its purpose of concentrating power in the hands of the few in so many aspects. For example, it refers to the transfer of the exercise of licensing functions under the Employment Agencies Act 1973 from local authorities to Whitehall. It refers to the proposal to amend the Health and Safety at Work Act 1974 as regards the appointment of safety representatives. The Under-Secretary of State will not have expected me to overlook that.
      This last amendment makes a mockery of the whole concept of elected safety representatives and calls in question the Government's sincerity in their much publicised efforts to improve industrial safety, for there can be no safety reason for deleting from the Health and Safety at Work Act provision for the election by
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      employees of safety representatives from among the employees. How does that improve safety? Certainly, it has nothing to do with the protection of employment. What is more, it removes what could be a fruitful area of consultation between employees and management, so it does not even help to improve industrial relations either.
      The purpose of this apparent piece of folly is made clear not in Schedule 13, in which the amendment occurs, but in Clause 103, which refers directly to it. It is to restrict the appointment of safety representatives to those appointed by the officials of the big trade unions—in other words, again to concentrate all the power and patronage in the hands of the militant few.
      The Bill is indicative of the muddled thinking of the Government, a Government who have failed to keep pace with the realities of the development of industrial relations techniques over the past 20 years. Full employment is not protected by putting shackles on management and giving power and privilege to those who carry no responsibility for the success of the enterprise. Full employment is protected and maintained by good commercial and industrial management, stimulated by the profit motive and backed by rising levels of investment.
      Economic growth is the basis of prosperity, and it is on prosperity that the protection of employment depends. The Bill contributes nothing to either economic growth or national prosperity.
      As regards improvements in industrial relations, these depend on the good will of both sides of industry, and on both sides, too, understanding their identity of interest. Both sides need patience, understanding and tolerance. The Bill is divisive and contributes nothing either to the needs of industrial relations or to the protection of full employment.
      I hope that my right hon. and hon. Friends on the Opposition Front Bench will be in no doubt that on this occasion they and I are marching in step, and I shall certainly support their opposition to the Bill.
      5.38 p.m.
      Mr. Frank R. White: In my opinion, the Bill should hold no fears for companies which work

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      at their industrial relations. Unfortunately, even after a decade of parliamentary involvement in industrial relations matters, far too many firms do not give this subject proper consideration or the proper status which it should have in management structures.
      Firms which are successful in industrial relations often have the personnel function represented at director and board room level, but there are too many British companies which still treat the personnel function, the industrial relations function, as a sort of industrial paternalism—I am reminded here of what was said by the right hon. Member for Lowestoft (Mr. Prior) opening for the Opposition—reminiscent of the "happy chappy" company in which people do not talk about wages and conditions so long as they get a bottle of sherry at Christmas. Equally, there is the company in which the personnel or industrial relations function is a place to ease out some fading management star—" He is no good at finance or manufacturing any more, so shove him into personnel. He cannot do much harm there, and we shall always be over him anyway." If half the thought that went into sales, marketing and accountancy was put into industrial relations before companies took actions many of which cause unrest, a positive step forward would be taken.
      Two weeks ago I attended the annual luncheon of a local employer's association, and I sat beside the managing director of a large multinational engineering company. He spoke to me about problems that were current in his particular activities and described how he had to get together with his co-directors to discuss them. He was amazed that his directors, when challenged with a question, were so confined to their specific functions. The marketing man could only speak about marketing, the sales man could deal only with sales and the finance man was restricted to his sphere. But, he told me, a decision was taken and he then went to see the chaps on the shop floor. I asked him where the personnel man was, the man who could tell him what the reaction from the shop floor would be. I asked whether he was involved in the decision-making process. He told me that he was not; he came under the manufacturing director
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      or perhaps it was the works manager who was responsible to the manufacturing director.
      During the course of the lunch the Chairman of the National Coal Board, Sir Derek Ezra, addressed us for about 20 minutes and spoke for five minutes about industrial relations problems, and a very good speech it was. The reply to that speech was made by the Chairman of the Employers' Association, who reversed Sir Derek Ezra's priorities and spoke about the problems of the nation and the economy. He spent five minutes thanking Sir Derek and 15 minutes slamming trade unionists, the Labour Party in general, the Government and industrial relations in particular. I went over afterwards to speak to my managing director friend, and I said how marvellous it was that all the problems of the country were not centred around accountancy, finance, sales or marketing, but were about industrial relations. Yet the man who makes the decisions, the man who helps to try to formulate policy on industrial relations, could not even get into the boardroom or have his point of view made known before the decisions were taken. The managing director accepted my point, but he did not say what action would follow.
      It is no good using industrial relations for fine "blood and thunder" after-dinner speeches and then going back to the company and using the same age-old procedures, the same age-old management structures, and making no attempt to implement modern structures, modern procedures, or to overhaul the systems to meet modern industrial relations pressures. It is no good ignoring the treatment, because if industry carries on in that fashion it may create gastronomic ulcers at the after-dinner speeches but it will certainly create industrial ulcers, as is now being proved. All those who mean business and have accepted the problems caused by industrial relations are overhauling their procedures and meeting the demand, and I congratulate them. For such people who take labour relations seriously the Bill holds no problems.
      I wish to deal with the question of the wages councils. I declare an interest in being a member of the General and Municipal Workers' Union. My union, more than most, is involved with wages

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      councils and is negotiating with the problems surrounding them. Those problems are generally related to industries which contain the lowest-wage earners in the country, and they create very great difficulty.
      The proposals on the wages councils as contained in Clauses 79 to 84 are on the whole most welcome. They represent the first major improvement in wages council machinery and scope for half a century. This may well be the significant breakthrough in the eventual elimination of scandalously low-paid workers in whole sections of industry.
      One reason for the laggardly progress in the wages council sector has been the long gaps between settlements. Proposals in Schedule 6 and Clause 79 to speed up the procedure by asking the Secretary of State to sanction orders is a major step in the right direction. In the past the lengthy, cumbersome procedure of wages councils has held up awards in many instances by 15 months or more with the delay between the application being made and the order being issued to notify the increase. The wages council sectors have fallen increasingly behind the increases in pay in the regular round of increases in the collective bargaining sector.
      Another inhibition has been the lack of bonus schemes and plus payments in the wages council sector. The widening of the scope of the councils as contained in Schedule 6 also refers to these differences between the wages council sector and negotiated areas. Orders under the new legislation specify all terms and conditions, not just the basic wages, hours and holidays, and will enable the wages councils to close the earnings gap which has arisen between these industries. I share some of the feeling and some of the disappointment expressed by the hon. Member for Rochdale (Mr. Smith) that there has been no defined minimum wage, but this kind of legislation will help to put up the unofficial minimum wage which already exists.
      Little will happen automatically without the organisation and development of bargaining and trade union membership in these areas. The interim stage between wages councils and free collective bargaining is now established by the statutory joint industrial councils in Clause
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      80 and 81. These follow very closely the proposals put to the Department by the employee-representative groups. However, the proposals and the functions specified do not go far enough. First, the SJICs should have powers to negotiate terms and conditions which are not statutorily enforceable like wages council orders. This will enable an agreement to be reached on an SJIC on a wider range of matters than before, but with the force of an ordinary collective agreement rather than a statutory imposition. I believe that this will make agreement easier and will ease the way to the translation of the SJICs into entirely voluntary collective bargaining bodies.
      Secondly, the SJICs should have specifically as one of their functions the encouragement of voluntarly collective bargaining, and on establishment should have a limited life of three to five years extendable by the Secretary of State if he can see that the progress towards voluntary collective bargaining is not proceeding sufficiently well. The SJICs should also have the duty to report annually on their progress.
      Thirdly, in those sectors where organisation and the development of voluntary collective bargaining is difficult and a long way off the penalties for ignoring wages council orders, or the SJIC orders, should be higher than at present. The maximum fine of £400 is insufficient. At least the persistent offender should be subject to higher penalties. More important, however, is the policing of the system and the imposition of penalties. In the short term the wages council inspectorate needs to be strengthened and the number of prosecutions should be increased. In 1972, the latest year for which I have figures, 11,000 substantive cases of breach of pay or holiday orders were established, yet only one case was brought. This is ludicrous.
      In those areas where we still need statutory controls to avoid exploitation the means of enforcement must be effective and credible. In this area the legislation should explicitly provide for wages councils to cover, or be established to cover and make orders to cover, home-workers or outworkers. These are two of the most exploited groups in industry at the present time.
      For the reasons that I have outlined I believe that there is nothing in the Bill

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      to fear. If both sides of industry give it their concerted support and back the ideals embodied in the Bill, I am sure that it will come to be regarded as the foundation of good, forward-looking industrial relations.
      5.50 p.m.
      Mr. Esmond Bulmer: Every hon. Member is deeply concerned about the present employment position. As an employer, I suggest that if current rates of inflation are maintained, the outlook is potentially catastrophic. I believe that we all wish to look carefully at a Bill that promises any improvement in the employment situation. I have looked carefully at this, and I have found it wanting in its strategy, timing and much of its emphasis.
      Clearly, the Bill seeks to protect employment by giving greater powers to trades unions. We are all aware of areas where the power of trades unions is too great, too great for their own good. One of the most dispiriting features of the Government's attitude to the social contract is that they continually give, give, give without showing that anything is obtained in return.
      The Government have an important position as umpire. When society has a body that is too strong for the constitution, as some trades unions now are, it is necessary for the Government to act as a check, or even as a balance, and not to give added emphasis to that monopoly, which is what the Government are now doing. Otherwise the result will be that trades unionists will price themselves out of the market, as they are now clearly doing on the railways, in the Post Office and soon, I am afraid, in the steel and motor car industries. None of us wants that, but it will happen if the Government do not have the guts to stand up and resist.
      We all wish to protect employment, and to do that we have to engender a totally new attitude. It must be understood that to keep a job men must be prepared to change it. I had thought that the Minister would say more than he did about retraining and monitoring obsolescence through the "little Neddies".
      I should like to refer to manpower strategy. People feel it to be a stigma if they lose a job, but there should be a
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      recognition that they are doing what society wants and they should be enabled to move house more easily and to transfer mortgages and pensions, and so on. Those are difficult problems, but they are the way to improve job prospects for everybody.
      Unfortunately, far too much union thinking is still directed to maintaining the status quo. In the light of union history, that is understandable. But is it not suicidal for the Ford workers to be working more slowly than they can do in order to protect their jobs? Clearly, they will lose and the nation will lose.
      It now seems to be axiomatic that nobody in the public sector should lose his job. The Bill seems to seek to extend that principle to the private sector. We must have greater mobility of labour, and to the extent that the Bill prevents that mobility it is not in the national interest. I would go so far as to say that labour hoarding in the nationalised industries, particularly over the past 10 years, has played a major part in investment failure, because far too often industries have found bottlenecks caused by the lack of skilled labour, or even of people to train.
      My second criticism of the Bill is that its timing is wrong. It will plainly place upon industry burdens, burdens disproportionate between a company that employs many women and a company that does not, between a small company and a large company. I hope that the Government will assure us that increases in costs resulting from the Bill will be treated as allowable by the Price Commission. If they are, is this the right time to borrow money from companies and hand it back? Are we justified in transferring these charges from the State to the employer?
      In my constituency one of the largest companies is having to cut the number of people it employs because of the operations of the Price Commission. I would guess that as a general rule the result of the work of the Price Commission is to reduce the number of jobs by between 5 and 10 per cent., and it would be interesting to have the Government's assessment.
      We all know that inflation of 20 or 30 per cent. makes company forward planning impossible. This is at the heart of the terrifying prospect for unemployment. We all know that shareholders are being penalised. Of the income available to

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      all companies, 6 per cent. goes to shareholders. This is at a time when one union is said to be claiming 50 per cent. If everything received by the shareholders went to salaries and wages, wages and salaries would be increased by only 6 per cent.
      When there are wage claims of 50 per cent., is it surprising that there is not the money we want coming forward for productive enterprises? What is the effect on morale in industry of the activities of the Secretary of State for Industry, who is undermining the whole basis of industrial discipline by refusing to allow the forces of the market to work?
      We all know that management is snowed under with legislation. This will be another measure on top of the two, three, four, five or six measures already on the desks of managers at a time when they are deeply worried about their ability to keep their companies going in the market place. The Government must give some thought to the effect of this legislation on managerial ability to run companies and to provide the necessary leadership.
      There is one subject that has not been mentioned, but it is desperately important. If the market is not allowed to operate, the moderate and sensible trade union leader cannot get across to his membership the facts of his long-term interests. We are all familiar with the shop steward who says "I knew that 16 per cent. was the right figure, but the lads would not have it. They told me to come back and get 30 per cent." So research is cut and so investment is cut.
      Mr. Litterick: Is the hon. Member aware that the British worker is now among the lowest paid in Europe and is the cheapest labour in Europe? Is he suggesting that labour should be even cheaper and that wages should be even lower?
      Mr. Bulmer: No, I am not suggesting that at all. I am saying that if wages exceed productivity there will be fewer jobs. We all want greater productivity and larger wages, but they must be related.
      Mr. Litterick: As in agriculture?
      Mr. Bulmer: I shall come to agriculture in a moment.
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      My third criticism concerns emphasis. Clearly the Bill is biased. The hon. Member for Newton (Mr. Evans) spoke of management co-operation. Does he think that the right way to get management co-operation is to produce a Bill that is totally one-sided? I do not need to spell out the evidence of this bias.
      My right hon. Friend the Member for Lowestoft (Mr. Prior) mentioned the composition of ACAS. It cannot be effective if it is biased. Clearly, there will be member companies in the CBI which, if they see codes of practice emanating from the ACAS that are totally one-sided, will want to withdraw, just as the trade unions objected to the Conservative Industrial Relations Act 1971.
      It is reasonable to ask: why cannot employers refer inter-union disputes? Why should not union members be protected from union abuse? Contrast the situation of the man who is unfairly dismissed from a company and the man unfairly expelled from a trade union. If he is unfairly dismissed from his company his pay is preserved. He appears before a court and has judgment delivered to him. The Press can be present and he has a fair hearing which is obvious to all.
      If he is unfairly expelled from his trade union he may not be able to get a job. His income is not protected. He has to wait for union procedures to be exhausted and then he has to wait for judgment through the union machinery. There is no Press access and no written judgment. That seems to be something upon which the Minister might reflect.
      Sooner or later if free institutions are to survive the unions will have to accept settlements by arbitration and not by strikes. What would have happened if the miners had bankrupted Leyland? How long would it be before the national interest was admitted?
      I turn to the problem of small businesses.
      Mr. Litterick: I thought the hon. Gentleman was going to talk about agriculture.
      Mr. Bulmer: Most of farming, but not all of it, is comprised of small businesses. There are 800,000 small businesses, many of them facing bankruptcy. If each one employed one person fewer the unemployment figure would double I do not

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      believe the Bill begins to recognise the difficulties facing small businesses.
      A farmer cannot take on a nine-month or 12-month temporary. Supposing a farmer is employing three people and one of them wants to become a magistrate. Should that farmer not be allowed to say that if that is the case he cannot afford to employ another person temporarily and that the person who wishes to become a magistrate must find another job? Is that so unreasonable? Clearly, there are small businesses which do not pay the rate for the job. But it is the question of a job or nothing.
      The guarantee provisions would clearly be unworkable in the event of power shortages during a national emergency. The farmer clearly has special problems with seasonal workers. The current resentment among farmers about the way they are being treated by the Government is enormous. There are many Labour Members who do not perhaps know a lot about farming. But they know a good deal about Russian history.
      I give a word of welcome to sonic parts of the Bill. It is clearly right that disclosure should be extended. We cannot expect employees to behave responsibly if they do not understand the implications of their actions. The more that people understand the way in which their future is bound up with the success of an enterprise the better it will be for the company and the country.
      This Bill has been introduced by a Government who look increasingly like a committee of the TUC. I do not believe that the Bill has done justice to the attitudes of the trade union movement. All the criticisms that the Labour Party threw at us can be returned. The Bill is totally biased. It replaces collective bargaining with the law. It will produce results quite different from those intended. It is certain that fewer women will be employed. We have only to look at what happened in Italy to confirm that.
      The guarantee provisions will lead to more employment of "lump" labour in the building industry. The job prospects for the less-well-endowed will collapse. To deserve the benefits of this Bill trade unionists must show that they can deliver, and it would have been nice to have heard from the Minister about some
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      developments aimed at reducing the number of unions and bargaining points, about education to meet new responsibilities. We all want to see security at work, but this must be done through flexibility and not through measures which preserve the status quo. If the Government wish to preserve employment they must drop their vendetta against private enterprise and restore freedom of action to those who can get the country out of the mess it is in.
      6.5 p.m.
      Mr. Robin Corbett: Thank you for calling me, Mr. Speaker.
      Mr. Deputy Speaker: Order. The hon. Gentleman is the fourth to address me as "Mr. Speaker." Like the corporal who is called "Sergeant", I have no objection, but for the sake of the record I am Mr. Deputy Speaker.
      Mr. Corbett: I apologise, Mr. Deputy Speaker.
      Before I came to this place I was for many years an honorary trade union official. I was one of those dreaded shop stewards. I served for five years on the national executive council of my union, and, if that does not raise cheers, perhaps I should mention that for the last four years of my working experience, in that context I was senior labour adviser with a major publishing group which had a printing involvement. I mention this because it is fair to say that people theorise about this subject, inside and outside the House.
      At times this afternoon we have heard people mistaking the aims of this Bill and suggesting that it bestows benefits upon trade unions—putting them into one camp and the employers into another. It is my case that the whole merit of the Bill is that it talks about improving relations between people at work without tying labels on them. As long as we, on any side, perpetuate this feeling that industry is divided into camps which are permanently at war we shall get destructive attitudes across industry and commerce.
      In a sense it is a pity that the Bill has been brought forward at all because it is sad commentary on what has happened over successive generations. There has been an appalling waste of people at work. We talk of human resources. One

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      criticism which can be levelled across industry is that it has not taken enough care of people who invest their skills and talents in their jobs. When most people go to work they leave their democratic rights on the pavement. Businesses can and do close down literally at an hour's notice. The livelihoods of men and women in small and large businesses can be and are jeopardised without a word of consultation or even warning. It can and does happen. My hon. Friend the Member for Bury and Radcliffe (Mr. White) mentioned a case in his constituency. It happened in mine a few weeks ago when literally at an hour's notice on a Friday afternoon the 30 employees got a note from the boss saying "Thank you. Goodbye. I am shutting up shop." We should examine relations between people at work—
      Mr. David Mitchell: Can the hon. Gentleman tell the House the extent to which financial difficulties caused that employer to close in that way and to what extent the Chancellor's measures were responsible?
      Mr. Corbett: The hon. Member tempts me to make comments about the firm concerned. My point is that, whatever the reason for this firm closing down, it is not good enough to give people one hour's notice. There were all sorts of reasons for that firm closing. If it makes the hon. Gentleman any happier—I do not think it will—the closure took place long before the Chancellor announced his Budget.
      We should acknowledge the pioneering work which has been done over the years to try to improve relations between people at work by such independent bodies as the Industrial Society and St. George's House at Windsor. The fact remains that there is an inadequate sharing of responsibility between people at work and an imbalance of rights. A white-collar worker can have "office 'flu" without loss of pay. She can have a baby on full or part pay. By and large, people on the shop floor—those to whom we look for help with production and productivity—get no such treatment. There is as much inequality and unfairness between groups of people at work as there is between work people generally and management. In negotiations, management generally holds all the informa-
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      tion aces and then accuses trade unions of not caring about the state of the business.
      The pattern of negotiation could, as it must, change within a fairly short time under the Bill. For example, we can end the horror—that is what it is—of instant redundancy and place on management the duty to provide full information, and similarly for collective bargaining purposes. It is my view, and certainly my experience, that the sharing of relevant information about the state of a business can and does lead to better understanding around the negotiating table. But the achievement of that understanding during negotiations is progress. It is no longer good enough simply for management to say to people with whom it is negotiating "That is the position because I say so".
      Information about the state of a business should be shared, and indeed is shared in many of the better-run commercial and industrial firms. There will still be disagreement, but the area of conflict is narrowed when information is shared and made available, because the facts are known and, hopefully, understood. The argument then arises on the judgment made on the basis of that information.
      Does it not in many instances come down to a matter of trust? Trust between people at work is a two-way matter. There is far too little trust. The more information is shared, the more that trust is earned, the better the chance of improving the relationship between people at work. By and large, power rests with the people who hold that information. The power must be shared if there is to be a lasting improvement in good industrial relations practice. I should have thought that every hon. Member would agree that a monopoly of information sowed the seeds of industrial discontent and allowed rumour-mongers, for whatever end, to have a field day.
      Where that information is not shared, the only räle given to people at work—often it is given not simply to trade unions but to people at work who may or may not be members of trade unions —is to say, "I do not believe you" and then to go on to say "No, I do not like it." The power left to people at work is essentially the power to say "No", and then to go on to throw stones through

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      the greenhouse window. It may be a very satisfying short-term pastime, but, through management's unawareness, it has become elevated into a sophisticated daily skill.
      If that is the major and, in instances, the only räle which our present system allows, we should not be surprised if it is increasingly well played by people at work. In my view, the Bill can start to change that situation by unlocking the information safe, by sharing the information, and so enabling and encouraging people at work to know more about what is going on and how they and the firm in which they have invested their skills and talents are doing.
      How often in industry do we hear people say "I must be doing all right because the boss has not spoken to me for six months "? That is very common in industry and in commerce. In many instances, the only time people hear from the boss is when they have dropped a brick, because they are so busy. Far too many managers pay far too little attention to the fact that people do not work only, or even mainly, for money. The contribution they make to the success of an enterprise needs and deserves to be recognised. It is my view, and again my experience, that people are more ready to accept the sort of change mentioned by the Opposition when they understand. They will understand better when they are told more. Conversely, the less they are told the more obdurate they will remain or become.
      I acknowledge that in the Bill there is some challenge to management which sensible management will welcome. The challenge is that, with more information being provided, people at work at other levels in a business will be better able to judge how the management is managing. I see nothing wrong in, and a lot to be gained from, people at work being able to say to their managers "Your skills are different from mine. But you must manage well because my job and livelihood depend on the skill and sensitivity of your management." A man at a lathe must show that he is up to the job in terms of the number or quality, or both, of what he is producing. Why should not a similar onus be put on managers and management generally?
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      I turn to the question of cost. This is a worry, and I am sure that the Minister acknowledges it. Some additional cost will result from the Bill's provisions on maternity leave, the right to redundancy pay, guarantee payments and others. But is not this precisely the time when we should encourage industry to make an investment in people? We all know how necessary is investment in manufacturing in particular. Is there not a much greater need for investment in the people who work the machines? Should we not assert at every level of the argument the prime importance of putting people before machines?
      The skill and success of a manager comes not out of a machine but out of the way in which he leads the people working with him. If industry generally cared more for the people who worked in it, would not this hold the promise, with the investment needed in re-equipping and modernising, of unlocking the skills, talents and enthusiasm of people at work which have been squandered or allowed to lay dormant for far too long?
      If we want a reminder of that, we need only turn to the Ryder Report on British Leyland, in which Sir Don Ryder acknowledges the willingness and enthusiasm of people at every level in British Leyland to help to get the firm back on its feet. The tragedy is that the present management and previous managements have not found a way of translating this enthusiasm and interest into productive outlets.
      Those who say "This is all very well, but it cannot be afforded" are opting for continuing the situation in which in too many areas industry remains a battleground. The Bill gives industry the opportunity to show that it cares about those whom it employes and it will enable those who go to work to play a much fuller and more constructive räle. It promises a new and changed partnership with a balance of rights which will enable responsibilities for success to be shared. This is an exciting challenge, and it is why the Bill is so important.
      6.18 p.m.
      Mr. Douglas Henderson: It has been valuable to hear of the experience in industry of the hon. Member for Hemel Hempstead (Mr.

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      Corbett) and to hear from someone with a background of understanding of the problem. I agree with the hon. Gentleman that far too many companies have underestimated the importance of the use of personnel and the question of industrial and human relations in all the other things that they do. The story told earlier of the company in which the managing director had taken an important decision and had not consulted those with direct access to people in personnel is perhaps all too prevalent
      Despite the fact that there is continual debate about the central importance of industrial relations, and newspapers, radio and television constantly harp on it, fat too few companies have done what is needed to be done to correct the situation. The changes taking place in industry and commerce have been affected by the changes which have been taking place in technology for a long time.
      Those of us who have worked in industry know how technology has altered the traditional attitude to payment systems and skills. Many people in industry now feel threatened, because traditional skills —for which they served apprenticeships, and which they felt sure would be used for a long time—are now undermined by the introduction of a machine which someone can be taught to use within a matter of weeks or, at the most, months. In the eyes of a company, the output of the machine operator is more important than the output of a man who has acquired an inherited skill.
      The size of businesses has been referred to. Hon. Members have talked, with justification, about small businesses. At the other end of the scale there is a growing concentration of industrial power in fewer and fewer hands, such as large combines and the multinationals. In many industries, individuals who previously worked for a company which they understood and to which they had certain company loyalty now find that they are working for an amorphous group, in circumstances in which a man in Detroit can sign a piece of paper which will put 2,000 people in Dundee out of work overnight. These are the sorts of things that concern people. Do we wonder that we have poor industrial relations? People feel threatened by such conditions.
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      One of the most outstanding American industrial psychologists described individuals in such organisations as follows:

      "1. They have minimum control over the working world;

      2. They are expected to be passive, dependent and subordinate;

      3. They are expected to have a short time perspective;

      4. They are induced to perfect limited range of abilities;

      5. They are expected to produce under conditions leading to psychological failure."

      That may be regarded by some people as an extreme description of the situation. All of us who have worked in industry know that many of these propositions are at least recognisable and that there are signs of them everywhere. People develop certain defences against them. There are the escape from reality and the psychosomatic illnesses. In the boardroom they are known as ulcers, but if we are humble enough to work on the shop floor it is backache or headache. There is apathy and non-involvement, which are manifested in, for example, delays and work stoppages.
      I hope that the Bill will tackle the problem of tribal practices which bedevil so much of industry today and which were briefly referred to by the hon. Member for Hemel Hemptstead. I refer to the division between people on the staff pay roll and people who are hourly-paid. It a girl who works on the shop floor wants to go to the hairdresser she has to take a morning off and lose a morning's pay. If she worked on the staff she would be able to take the morning off. She might get a black look, but that is all that would be done about it. No one can defend or justify this. I hope that it is the sort of thing we are trying to get away from. We want everyone in a company to receive the same consideration. We want to build up a situation in which we have an all-through payment system from the top to the bottom, and an all-through common benefit system.
      I am particularly concerned with redundancies, because in Scotland we have probably suffered more than our fair share of them. Scotland is especially vulnerable, with the number of branch factories in which ownership and control are vested in people outside Scotland—people who can take decisions that affect the lives and livelihoods of hundreds of

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      thousands of Scottish people. I hope that the improved conditions provided by the Bill will act as a check on the arbitrary use of this power to reduce at a stroke the living standards of Scottish people.
      During the Easter Recess I took the opportunity to have a meeting with all the major employers in my constituency to discuss the Bill. Certain points were brought to my attention, and I hope that they will be answered now or in Committee. There seems to be a problem about the redundancy provision in respect of seasonal industries. There are certain industries, especially in the food trade, in which people are employed for a seasonal period of perhaps three months. I was asked, "If you have to give 90 days' notice does that mean that immediately you take a person on you have to give him 90 days' notice that he will not be required at the end of that period?" I hope that that point can be cleared up by the Minister.
      The Minister of State was right to agree that there are special problems with small businesses. I would not go as far as the right hon. Member for Lowestoft (Mr. Prior), who described small businesses as those employing 100 people or fewer. That is a rather general and elastic use of the term. There are certainly small businesses which would suffer from, for example, the provision of reinstatement after pregnancy. There may be only two girls in an office, and if one leaves and is away for a year it may be impossible to carry on the business with one girl in the expectation that the other will come back later. I hope that other hon. Members, while wanting to protect the interests of the person who leaves, will also he sensible about the problem.
      Another problem is the difficulty that small businesses will encounter in understanding the Bill and the amount of legislation going through the House. We should not underestimate the problem for businesses which cannot employ personnel specialists and the other people who are so influential these days. Something special must be done for them to make sure that the provisions of this legislation are digested, understood and implemented. Clearly the small business man is getting on with his job, and he does not have the time, any more than
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      many hon. Members do, to read the mass of legislation which is pouring out from the Government.
      On Schedule 10, clarification is desirable in relation to the averaging of wages in particular areas. It is not clear to me what is meant by an average wage for a district, or the district average. Does it apply to employment exchange districts or regional planning area districts'? To what districts does it apply? How is it to be worked out? Let us take as an example the job of a clerk. A clerk in one company may do a certain type of job, but a clerk in another company may have a much more responsible job. If we talk about an average wage, how shall we make sure that we are comparing like with like across a different range of companies, perhaps with different organisations, different job structures and different job definitions? Is it implied that there will be a kind of super-job evaluation for each district, so that people are slotted into certain grades? How does the Minister intend this provision to be implemented? How will it affect the people concerned? We are entitled to an answer, if not today, certainly in Committee.
      We must be careful not to promise too much in any legislation of this type. We should recognise that the law cannot do everything for everyone. 'There are some people who go around looking for simple solutions to what are essentially difficult and complex problems. [AnHON. MEMBER: "Or the other way around."] I make no comment. This is a difficult problem, and it must be approached with a great sense of flexibility and humility by all hon. Members.
      This Bill and the Industry Bill will place a tremendous onus on trade unions. I was delighted to hear that the Transport and General Workers' Union is engaged in a massive new educational programme with new facilities. Let no one underestimate the problems for the trade unions, and especially for those strange and exotic beings such as the hon. Member for Hemel Hempstead referred to—the shop stewards. They are the key men. A great programme will have to be undertaken. When I spoke to the employers in my constituency I also spoke to most of the shop stewards in the major companies. I asked them what provisions the trade unions were

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      making to ensure that they would be informed and able to use the information they were given. The response was a little vague. Those involved must make sure that the trade unions respond, and use the information responsibly.
      I hope that in Committee the Government will show a sense of conciliation, in the terms of the Bill, towards reasonable amendments. My hon. Friends and I will support the Government on Second Reading.
      6.30 p.m.
      Mr. J. M. Craigen: I welcome any Bill that seeks to improve industrial relations practice. I believe that this Bill will not prove so formidable to many of the progressive employers who already put into practice some of its provisions, but it is a highly complex and comprehensive legislative package. I only hope that the good intentions that bind it together will be strong enough to bear its full weight.
      I fear that unless we can improve the economic climate the Bill's objectives will fall flat on their face. We are dependent on a better industrial and economic climate to fulfil this latest stage of the social contract. That is especially true of Part IV, dealing with the vexed problem of redundancy.
      The Bill is right to have, as Part I, the whole topic of improving industrial relations. It is a welcome step forward to give statutory status to the Advisory, Conciliation and Arbitration Service. Many of us have placed high hopes on the service. We look to it to help to provide an antidote to the general poison that crept into industrial relations in the early 1970s. There is a great yearning throughout the country for a bit of peace and quiet on the industrial relations front.
      We must start to emphasise the positive side of industrial relations. We live in an upside-down world when we can get as many figures as we like about the number of days lost through industrial dispute but no one seems able to tell us the number of days actually worked in Britain. I am told that in ancient times the Chinese paid their doctor when they were well and stopped paying him when they were unwell. That practice might well be followed with good effect in the whole area of industrial relations.
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      There is no doubt that working people are becoming somewhat immune to the inconvenience of industrial disputes. It is as though we were inoculated against the actions of our fellow men and women. As we extend the public sector everyone will, more or less, be every one else's boss. That means that we must rethink the way in which we organise our industrial relations.
      The television and the Press will have to start laying off industrial relations. To some extent these media have become the biggest auctioneers in the business of the whole wages spiral. The differential problem in industry is very big and tricky. I should like to hear a little more about what the Royal Commission on the distribution of incomes is up to. It has been very quiet recently. Equality of reward will be a vital area for those involved in industrial relations. I hope that the Advisory, Conciliation and Arbitration Service will be able to bring to bear a considerable amount of experience and good will. I urge my hon. Friend the Minister to strengthen the Scottish dimension of the service.
      I turn to Part IV, dealing with redundancies. A great deal of our economic planning is done by the Treasury. At times, it seems as though the ghost of Sir Stafford Cripps is still walking the corridors of Whitehall and that we are still whispering about the problem of manpower, retraining and job creation. One can consult a man as much as one likes when telling him that he will be redundant, but at the end of the day he gets his P45. Bringing new jobs to Scotland and other parts of the United Kingdom is vital.
      My hon. Friend also has a responsibility for employment and training. I believe that he could not do better than to give the industrial training boards a nudge to recruit and employ young people for apprenticeships. It would be a helpful start in meeting the considerable problem which will arise for young people looking for work.
      I question my hon. Friend about the state of the Redundancy Fund. I believe that it is now out of deficit, but as far as I can discover it was in deficit to the tune of £10·1 million in 1971–72. In the present economic situation, there is a certain air of unreality about an over-concentration on consultation and possibly

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      not enough emphasis on being able to carry the burdens which will result from firms closing. if the Bill is to be a worker's charter, the payment of wages and accrued holiday entitlement should be a prior debt when a company becomes insolvent.
      Is the code of conduct to be binding? Trade union officers often rely on a code of conduct, but if, when they say "We abided by the code", they are to be told "The code is meaningless in legal terms", little legal backing will be given to those who seek to abide by the code.
      I wonder whether the time has arrived when we should be giving working people legal aid when they appear before tribunals. Unions are sometimes inadequately staffed for the purpose, or the trade union officer concerned may feel that the case is not strong. Some people, regrettably, are not members of a trade union. The problem of appearing before a tribunal is one of seeking reparation, not representation. There may well be a case for considering legal advice and representation.
      I confess to a certain puzzlement over the arrangements for women leaving employment as a result of pregnancy, and over the position in which the temporary worker will be placed. Unless it is clearly stated in writing that he is only temporary, I can see formidable difficulties. I can envisage employers playing musical chairs with some employees to get them out of the door. The terms should be in writing. I also find it somewhat puzzling, in this day of opposition to sex discrimination, that Clause 45 provides that the person who will be put out of a job when the woman returns is a male, because it says:
      "his employment will be terminated."
      I broadly welcome the Bill, though I have no doubt that changes will be made. In some respects it is misnamed. It would have been more appropriately entitled "Improved Practice in Industrial Relations Bill". The only way to protect or safeguard peoples' employment is by motivating those who work in industry by removing much of the dissatisfaction which exists and by ending the private investment strike which has greatly weakened British industry since long before the war.
      6.40 p.m.
      Mr. Kenneth Baker: The hon. Member for Glasgow, Mary-hill (Mr. Craigen) made some interesting observations in his forthright speech, which characterised the somewhat strange nature of the debate. Listening to all the speeches, as I have, at times I hardly believed that Government supporters were debating the Bill that we are debating. Government supporters looked upon the Bill as improving industrial relations, as many of the proposals do, and in doing so looked at it narrowly, whereas most Opposition speakers, including the spokesman for the Liberal Party and to some extent the spokesman for the Scottish National Party, looked at the broader political implications of the Bill. If the Secretary of State for Employment had been with us today and not, unfortunately, in hospital, we should have seen at an earlier stage from the Government benches the political cutting edge of the Bill.
      As the Minister of State said, the Bill is an integral and essential part of the social contract. My colleagues and I contend that, taken with two or three other measures which are now before Parliament, it substantially increases the influence, status and power of organised trade unions. Labour back benchers, above or below the Gangway, cannot reproach their Government for not fulfilling that part of the manifesto, particularly the phrase which refers to bringing about—
      "a fundamental and irreversible shift in the balance of wealth and power in favour of working people and their families".
      [HON. MEMBERS: "Hear, hear."] Before hon. Gentlemen cheer, I hope that they will bear in mind that many right hon. and hon. Members of all parties and a vast number of people outside the House do not find the phrase "working people and their families" entirely synonymous with organised trade unions.
      It would be idle to deny that a fundamental shift of power has taken place in our society in favour of organised trade unions. They have been the most dominant force in the past six years of the political history of our country. In 1969 the TUC and certain unions made the Labour Prime Minister of the day withdraw a measure which was considered to be fundamental. They took

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      the Prime Minister's scalp. In 1974 they took the scalp of a Conservative Prime Minister, and for the past year they have been determining the Government's economic policy. The interesting issue over the next six months in the economic and political history of Britain is whether Treasury orthodoxy, as personified by the Chancellor of the Exchequer, will win out against the trade unions—
      Mr. John Biffen: It will win hands down
      Mr. Baker: My hon. Friend says that the Treasury will win hands down, but I shall not be so rash as to predict who will win. All I know is that the battle will be bloody.
      Our contention—it is proven by the measures which are now before Parliament—is that there has been a substantial shift in the balance of power in favour of organised trade unions. The Trade Union and Labour Relations (Amendment) Bill has considerably increased the power of trade unions to maintain or impose post-entry closed shops. The Industry Bill is in Commit. tee and, therefore, I shall not dilate upon it, other than to say that in its disclosure provisions the channel of communication of disclosure from a company is not to its employees but to trade unions. I am in favour of the disclosure of information. In businesses with which I have been concerned in the past I have been an advocate of disclosure and have tried to practise it, but the disclosure provisions in the Bill provide that the only channel of statutory communication between an employer and his work force is through trade union officials, who may not even be employees of the company. That provision conveys a considerable privilege to trade unions, and over the years, in certain circumstances, it will lead to increased powers.
      Mr. Litterick: Is the hon. Gentleman aware that in British industry it is a not uncommon practice for employers deliberately to choose to communicate through professional trade union officials rather than direct to their own employees through lay representatives?
      Mr. Baker: The hon. Gentleman is right. A company which I advise does that, but that demonstrates the variety of the methods of communication. What
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      I am opposed to is the Bill's statutory enforcement of only one method when there are many.
      The Bill which we are discussing, as the hon. Member for Rochdale (Mr. Smith) said, considerably enhances the power of organised trade unions, sometimes at the expense of employers and sometimes at the expense of non-unionised employees.
      Clause 11 allows trade unions but not employers to refer recognition disputes to the ACAS. That is a clear bias, which is totally unsatisfactory. I do not object to the principle of the guarantee payments covered by Clause 22, but how unfair it is to penalise a company that has to make these payments because of an industrial dispute in another company. That is a matter which we shall have to debate in Committee. In certain circumstances, that provision could increase the temptation to take industrial action. Again, it is an example of bias.
      No one can claim that the Government are not fulfilling their side of the social contract. Some trade union officials to whom I have spoken can scarcely believe that they are getting so much from the Government. Their powers have been substantially increased by these three measures, and the attraction of joining a union, therefore, has been substantially increased.
      What has been offered in return? The country was told that there would be some collective responsibility, some measure of income moderation—I will not even call it wage restraint—but we have seen nothing of that, as several of my hon. and right hon. Friends have said. All we know is that when a union puts in a claim for over 30 per cent. Mr. Len Murray talks to the general secretary of the union. Only last week I read that Mr. Len Murray had carpeted Mr. Buckton. Being carpeted by Mr. Murray is rather like being sentenced to death by being pelted with powder puffs, because he has no power over the constituent members of the TUC.
      In the two elections last year the country was persuaded that there was real bite in the union side of the social contract. If the powers in these three measures are being conveyed, we have a right to ask what is being given in exchange. The country is entitled to

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      expect that one of the great estates of the land should conduct itself responsibly. It is a measure of considerable regret that that has not happened.
      I read recently of a comment by Lord Houghton, the former Chairman of the Parliamentary Labour Party who, before coming to the House, spent the greater part of his working life as an active trade union official in a civil service union. He said:
      "The unions have not yet summoned enough moral and institutional strength to govern themselves wisely and with tolerance."
      When these powers are being conveyed in statutory form by the three measures I have mentioned, the Opposition, speaking for many millions of people, have a right to ask what is being given in exchange.
      Mr. David Mitchell: My hon. Friend has suggested that Mr. Len Murray has no power to enforce his side of the social contract. Does my hon. Friend recall that when the Industrial Relations Act was passing through the House the General Secretary of the TUC appeared to have considerable powers, which presumably he still has if he cares to use them?
      Mr. Baker: I think that my hon. Friend makes a valid point. TUC approval is rather like an electric current that is switched on when it is needed and switched off when it is not needed. It is now switched off completely.
      It is clear that the main priority of the Government is job preservation. That is what Mr. Len Murray said yesterday and that is why the Government have introduced support amounting to £2·8 billion for British Leyland. That is why they have supported the three co-operatives at Meriden, Glasgow and Kirkby. That is why the Bill is called the Employment Protection Bill. It is clear that job preservation is the Government's first priority. This Bill makes it much more difficult for employers to sack or lay off people.
      I appreciate the deep anxiety about unemployment that is felt by many people in industrial firms throughout the country. I appreciate the feeling of many working people that their livelihoods arc subject to forces completely
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      beyond their control. They feel this whether they work for a multinational company or a British company. They feel anxious and apprehensive. If the Government have job preservation as their first priority, and if that job preservation is applied at all costs, it will in the short term, turn out to be the enemy of expanding job opportunities in the long term.
      I am most anxious that for the best of all possible reasons—the prevention of unemployment—procedures will be set up that will make it almost impossible for some companies and industries to make the necessary changes; to respond to the inevitability of industrial change; to deal with overmanning and poor productivity. All those measures are bound to lead to a reduction in jobs. My hon. Friend the Member for Kidderminster (Mr. Bulmer) referred to them as a consolidation of the status quo. The danger for large parts of the United Kingdom's economy is that a job preservation paralysis will set in. A much more imaginative and positive approach is needed.
      First, I suggest that the Government should now determine and name those industries or parts of industries that are facing major restructuring as a result of technological change or because of a basic shift in demand for their products. Britain has an unusuaily high proportion of industries in that position. The docks have been mentioned. In addition, there is shipbuilding and part of the printing industry.
      When I was responsible for the Stationery Office in the last Conservative Government I appreciated that the restrictive practices of the printing unions, which are some of the most restrictive in the country, came about because of the anxiety of the work force about their job security and about the rapid technological changes in the industry. Such change was not their friend as it was to turn them out of their jobs. I also include parts of the steel industry and parts of the motor vehicle industry.
      Secondly, a fund should be established —I shall call it the "Industrial Restructuring Fund "—which would be financed by industry alone. Workers in the designated industries would be eligible to receive payments from that fund well in excess of the normal redundancy payment when they left their employment. That

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      would be paid on the understanding that they did not seek re-employment in the industry.
      Thirdly, those ex-employees should be encouraged and paid to be retrained. I welcome the extra expenditure of £50 million in the recent Budget on the Manpower Services Commission. I also pay tribute to the groundwork which was carried out by my right hon. Friend the Member for Carshalton (Mr. Carr) during the last Conservative Government in substantially increasing training and retraining facilities. At the same time there should be substantial mobility grants to allow those workers who decided to leave an industry suffering from restructuring and from a basic fundamental change to be retrained and if necessary to move.
      That proposal for an "Industrial Restructuring Fund" is a development of the Jones-Aldington proposals. Those proposals seemed to be much on the right lines for the docks and they need to be developed more widely. The advantage of such a scheme would he, first, that it would have greater realism than the sort of official and unofficial work sharing which will spread throughout British industry over the next two or three years.
      Secondly, many people in the industries that I have mentioned would welcome a substantial capital sum and withdrawal from a company which has a limited future. They would welcome retraining in a skill and re-employment in a company with a future.
      Thirdly, such a scheme would encourage the necessary changes in our industrial economy rather than delaying them. There are too many handbrakes in this Bill and it will delay a lot of inevitable changes. The scheme that I have put forward would allay the anxiety and fear of many workers who have found that change has not been their ally. In the past change for many working people has meant loss of job security and loss of peace of mind. It would be much better for us as a society to face that situation.
      New ideas are needed, but they should not be so defensive as the measures in this Bill and so unrealistic as many of the support activities undertaken by the Government. What we have to do is to find a way of softening the impact of change in our society, that is to say, tempering
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      to some extent the consequence of change which all too frequently and inevitably leads to unemployment. If we do not do that we shall come out of the depression into which we are now moving, very much weaker and with no reserves of strength. If we do not change our fundamental approach we shall be rejecting the possibility of greater prosperity in future. If we do not adopt measures of the sort that I have indicated I believe that we shall be covering more and more of our economy with dustsheets and setting out upon a road which will eventually lead to a museum economy.
      6.58 p.m.
      Mr. J. W. Rooker: I welcome the Bill wholeheartedly. During the Easter Recess I took the opportunity to read it and I must tell my hon. Friend the Under-Secretary of State that I found it a good read. However, there are many drafting errors. If we were singling out for attention the employment of parliamentary draftsmen I think that there would be a good case for booting out a few of them. No one has mentioned one drafting error which makes the Bill provide that on unfair dismissal no one will receive less than £5,200. That is the way that the Bill is drafted at present. I intend to blow a few more whistles before I sit down.
      Millions of people will welcome the Bill and the changes that it makes. They will welcome the redundancy procedures and the innovations of guaranteed pay and maternity benefits. There will be benefits for those who are suspended on medical grounds under the Factories Acts. Many people will gain if their companies are declared bankrupt. There are changes in the remedies for unfair dismissal. I am delighted to see that there is a remedy that covers the problem of people who are offered re-engagement but who lose all accrued pension benefits and accrued rights to future redundancy pay because of the technical difference between reinstatement and re-engagement.
      All the matters that I have raised so far concern the individual employment contract. They have nothing to do with the questions of how our trade unions are organised and how they operate. There is a good case to be made for legislating separately on matters that concern the individual employment contract so

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      as to keep them separate from trade union matters.
      The Bill is our version of the Industrial Relations Act. That has not been said so openly as it should have been by my right hon. and hon. Friends. The measure should be renamed the "Industrial Relations Act 1975" because that is what it is about. I have great fears about the Bill and I am certainly not happy about mixing up individual employment relationships with trade union relationships.
      We all know that the Conservative Government's Industrial Relations Act was totally opposed by the trade union movement. Some trade unionists went as far as to refuse to allow their officers to represent workers at tribunals hearing cases of unfair dismissal. Many of the officers disputed that dictum from head office and represented the workers concerned. I foresee a situation in which the present Bill could be used in the same way so that decisions would be made by noble Lords next door poking their noses into industrial relations. I fear that action of that kind will set the trade unions against this legislation. I am fearful of the reaction among the trade unions if the provisions spill over into other areas which have nothing to do with the original intention. In judging relationships between employee and employer we must ensure that people do not suffer in any way from problems relating to collective bargaining.
      I am afraid that noble Lords will stick their noses into areas concerning certification of the independence of various trade unions. It is already open for such decisions to be made, in the ultimate, by three Lords of Appeal sitting next door. It is possible to imagine a case going before an industrial tribunal and being heard by a High Court judge and two laymen. That case may be won by the trade union, but, nevertheless, may be appealed against and go before the new appeal body which is to be set up under the Bill. On that occasion it will be heard by another judge, and that again may be taken to appeal. That decision may revert to the original decision in the trade union's favour. One can envisage a system in which nine judges will have examined a case and which it will take a three to two majority next door to settle. In other words, only three judges
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      out of the overall total of nine who have looked at the case will have the final say.
      We are here setting up an appeal tribunal which will make crucial decisions in industrial relations, but because of the way in which the Bill is framed there are many cases, particularly those involving certification of the independence of trade unions, which may slip through all the appeal stages to the noble Lords next door. I am not happy about that and I do not know whether the TUC or the unions in general are happy about it.
      There is at least one member of the Cabinet who raised this matter in 1963 in connection with the Factories Acts. I refer to the noble Lord, Lord Shepherd, who drew attention to decisions affecting factory safety and dealt with the way in which those matters could be passed up through the various appeal procedures. His point was that what was required was knowledge of what happens on the workshop floor, but in the end the matter fell to be decided by the noble Lords in the other place—people who had never turned their hands to a real day's work in their lives. The noble Lord, Lord Shepherd, raised this matter in 1963 in the other place, and I know that he has been contacted about the procedure provided in the present Bill. It is feared that a terrible situation could arise if decisions on these matters are made next door —[Interruption] These things want spilling and this is the place to do it.
      We must change this Bill; we must bring about fundamental alterations. One vital change is that we should have a record of what goes on before industrial tribunals. The notes of chairmen are no good whatever, because an appeal involves matters of fact and of law, and although one cannot go back and prove what was said if no note is made of it, very often the judgment in such cases amounts to two quarto pages of notes which the chairman thought relevant to jot down at the time. Sometimes one does not know who has said what. Therefore, it is crucial that in tribunals there should be arrangements for recordings to be taken of everything said, and for those to be available for people who want to have transcripts.
      I take the opposite view from Conservative Members who believe that the Bill is biased in favour of the trade unions. I

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      believe that in many cases the Bill is extremely biased in favour of the employers. Unfortunately, we have not heard much on that score in this debate.
      For example, on the question of guaranteed payments, under Clause 23, subsection (1) provides that no payment will be made if a trade dispute is taking place at the time. If we refer to the definition of a trade dispute we find that it covers a lockout under the Trade Union and Labour Relations Act 1974. Clause 23 refers to a trade dispute involving an employer or an "associated employer". That phrase is not defined. Therefore, one does not know whether to read the various pieces of legislation in conjunction in order to understand what is meant. One does not know whether the phrase "associated employer" means an employers' association. That is not abundantly clear.
      We know cases in which employers' associations have attempted to set up insurance funds, and where employers, by coughing up money for the funds, have found it possible to opt out of the provisions. If there is a lockout in connection with an associated employer one supposes that would be within the terms of a dispute under the 1974 Act and that it could have the effect of nullifying any guaranteed lay-off payment for workers in another factory. It is tough luck on an employer who will have to pay a guaranteed sum when a dispute occurs elsewhere. Is the situation different as between a lockout and a strike? The provisions appear to be a little biased.
      The second example of bias to which I wish to refer occurs in Clause 71 which deals with itemised pay statements. It is surely ludicrous for anybody who has been in industry to be told that there has to be legislation to allow a worker to have an itemised statement in his pay packet showing his deductions, overtime, subscriptions to company clubs, newspaper payments and all the rest of it. Arc we legislating for such a thing in 1975?
      The clause states boldly:
      "Every employee shall have the right to be given by his employer… an itemised pay statement …".
      It appears that there is no power to make such a statement available to anybody over the age of 65. Why should the Bill
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      discriminate against somebody who goes on working after retirement age? There is no policy reason for that whatever. It appears that once again the draftsmen have made another blunder.
      The third example of bias relates to deductions by employers in respect of social security benefits which would have been paid to a man who has been sacked. If the worker concerned appears before a tribunal to fight the case on the grounds of unfair dismissal and wins that case and is then re-engaged, the employer is entitled to deduct social security payments. I do not see why taxpayers should be forced to pay for that employer's mismanagement in sacking somebody wrongly and unfairly in the first place. This is another ambiguity which I can only put down to the parliamentary draftsmen.
      I should like to deal with the question of insolvency. We all know about the fly-by-night firm with which my hon. Friend the Member for Goole (Dr. Marshall) dealt, and workers' difficulties in getting at the assets. Therefore, it is right that the State should take over responsibility for certain minimum payments. However, there is nothing in the Bill to say that the State should become a preferential creditor in respect of that clawback of cash.
      Mr. Booth: If I may help my hon. Friend, the position is that the Bill provides that the fund will stand in exactly the position in which the employee stood before and will line up with other preferential creditors in claims against the assets of the company.
      Mr. Rooker: Yes, but, if I am not mistaken, previously employees were always pretty low down the queue for priority. There are certain requirements for taxation and other benefits that go to the top of the queue, but many employees have missed out. Nevertheless, these are points that we must press in Committee.
      The last example I want to give of bias towards employers arises in Clause 18 and concerns the confidentiality of information. It is all very well for employers and trade unions to have all the information they need for collective bargaining, but the clause says that the employer does not have to disclose

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      information if he has received it in confidence. That is much too wide a getout clause for the employer in fulfilling his responsibilities.
      The problem of picketing has been adequately covered in a speech by one of my hon. Friends. It must be cleared up in this Bill and cannot be left to another Bill or another court case. We must do away with the unnecessary unrest on this subject. We should grab this opportunity in Committee with both hands and settle this problem once for all.
      Many hon. Members have mentioned homeworkers and they are referred to in the Liberal amendment. The amendment says that the low basic limit was promised certain action. I think that I was promised some action in the Bill, as do some of my hon. Friends. The legislation could have been tightened so that we could find out who the homeworkers are.
      I should like to refer to the recommendations of two CIR reports. The first one is Report No. 49 on the Pin, Hook and Eye and Snap Fastener Wages Council. Under a chapter headed, "Homeworkers" it says:
      "Our inquiries indicated however that in the pin industry lists lodged with the local authority were far from complete and often inaccurate. Two establishments which we knew employed homeworkers had not lodged a list with the local authority and we found it necessary to approach the companies direct. Even those lists that were lodged were not current, often containing the names of individuals who had long ceased to do homework."
      The requirement of a lodgers' list is contained in Section 133 of the Factories Act 1961. Under that section, if a list of homeworkers is not lodged twice a year with the local authority there will be a fine of £30. Last year I received a letter from the Under-Secretary saying that on no occasion has there been a record of any employer being taken to court for this.
      A later report of the CIR on the clothing industry referred to homeworkers. It said:
      "A recent survey has shown that in 1972 some 13,000 clothing outworkers were registered with the local authorities. This confirms our finding that registration is not comprehensive. Nearly 70 per cent. of the employers of home-workers interviewed employing 59 per cent. of homeworkers working from establishments we visited did not know of the registration procedure and therefore did not comply with it."
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      Therefore, before we do anything about homeworkers we should take some action to enforce the existing legal requirement. It is vital that this section of the Factories Act 1961 is toughened, and it should not be left to the Health and Safety Commission. That will not be good enough. I know that my hon. Friend will seek to strengthen it in Committee.
      I welcome the Bill and I shall support the Government tonight. Although I have been critical, I hope that my criticisms have been constructive. They were based on reality, the practice and the evidence brought forward when the Conservative Government presented the Industrial Relations Act. I reinforce the point that we have to do everything possible to amend the Bill so that it keeps the noses of the Law Lords out of industrial relations in this country.
      7.14 p.m.
      Mr. McCusker: The right hon. Member for Lowestoft (Mr. Prior) said that the Bill had been hastily drafted and the hon. Member for Birmingham, Perry Barr (Mr. Rooker) referred to a number of mistakes which he had found.
      I would refer the House to Clause 114. I do not know how long a period has to elapse before it can be said that a Bill has not been hastily drafted. Clause 114 says:
      "If legislation is passed for purposes similar to the purposes of this Act by the Northern Ireland Assembly the Secretary of State may.…"
      The Northern Ireland Assembly ceased to function 12 months ago. That would render this provision obsolete. It is particularly inappropriate in a week when elections are being held in Northern Ireland to elect people to the Constitutional Convention. However, we welcome the optimism shown by the Government that perhaps we shall have an assembly in the not too distant future.
      I give the Bill a qualified welcome on behalf of my Ulster Unionist colleagues, although we regret the necessity for it. We have an honourable tradition in saying that we believe in free collective bargaining. In the eighteenth and nineteenth centuries, when the peasant farmers of Ireland, whether they were planters or of Gaelic origin, were being oppressed by absentee landlords and rent rackets, there grew up in that part of Ireland now known as Northern Ireland what was

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      called the "Ulster custom". The peasant farmers in that area used to say to their oppressors, "You will not evict us and you will not levy rent upon us. We will not allow you to." They obtained a voluntary agreement that this would not happen and they established a principle which has been carried on for many generations in Northern Ireland.
      We were not inflicted with the legislation of the previous Conservative Government and we deprecate the necessity to extend legal processes into areas of dispute, traditionally settled by voluntary means, However—here I agree with the hon. Member for Newton (Mr. Evans)—if in 1975 it is necessary to enshrine in legislation the right for a person to have a written notice of dismissal, a shop steward to have time off for his union activities, an employee to have time to take part in public services and, as the hon. Member for Birmingham, Perry Barr said, an itemised statement of pay, perhaps there are more employers in Great Britain who require to be dragged into the second half of the twentieth century than there are in Northern Ireland. Northern Ireland is ahead of the rest of the United Kingdom on this matter. A leading industrialist told me at the weekend that the Government are casting the Bill at the lowest common denominator of industry in the United Kingdom.
      I want to comment on some of the major proposals. I agree with much that has been said by Labour Members. The establishment of an Advisory, Conciliation and Arbitration Service is, to some extent, returning to what the rest of the Kingdom had before it suffered from its IRA. We had our own variety and we felt that we did not require England's variety as well. Because the Industrial Relations Act did not apply to Northern Ireland, during the past four of five years we have developed conciliation and arbitration services similar to those that existed in this country before they were abolished.
      I hope that the Minister is aware of the principal recommendations of the tripartite report on industrial relations in Northern Ireland, which was produced last year and which hoped to establish an independent labour relations agency. There has been an impasse in the government of our Province for some time
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      and we have been unable to keep the formation of that agency in the front of our mind. If that agency is established it will keep us in line with the proposals in the Bill. If we had already established it, we should be ahead of England. We are glad to see that Great Britain is getting back into line with Northern Ireland.
      I understand the apprehension felt by some employers about the part of the Bill dealing with the disclosure of information. As has been stated by many Labour Members, enlightened employers are already disclosing much of this information through existing channels of joint consultation. I agree with the hon. Member for Hemel Hempstead (Mr. Corbett) that fear of disclosure is another sympton of "them and us". We must get rid of that.
      As an educationalist and an industrialist I have learned that, individually or in groups, children or adults tend to live up or live down to the expectations we have of them. If an employer treats the members of his work force as untrustworthy delinquents, he should not be surprised if occasionally they seem to behave that way.
      However, I would offer a word of caution to the unions. Do they really want this information? They may find that it will frequently justify the management case. I can remember many instances when, as an industrial engineer, I had the union convener come down with me to check the rate on the job. If I had put in the rate that he recommended, we should have had more problems than we had with the rate that I was putting in. This development brings with it obligations, and I hope that the unions will be prepared to accept their responsibility.
      Mr. John Evans: Does the hon. Gentleman not agree that if the disclosure of information would back the management's case, as opposed to that of the unions, it would be an even better argument for disclosure?
      Mr. McCusker: I agree completely—to some extent, that is my point—provided that the union official is prepared to act on the information when he is convinced that it is legitimate, honest and given for the correct purposes.

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      Most progressive and responsible companies already have a system of guaranteed pay. In the past many of these have found this a useful bargaining counter in general wage negotiations. I hope that this will continue and that the Government will be able to extend the provisions of the Bill.
      As a production manager, operating some very expensive equipment, I was always amazed at the fact that, although senior managers would immediately shut down a machine if there was the slightest problem with it—although it cost a fortune to have it standing idle while the engineers were in—I frequently had to fight with my foreman and supervisors to get a worker to go to the hospital if he had injured himself. We need to get into British industry the mentality that workers are more important than machines. If a guarantee of a week's wages in a situation over which they have no control is an attempt to do that, I welcome it.
      Also, of course. it will bring to the shop floor workers something of the consideration frequently offered to 17-yearold office clerks. I always found it hard to understand why an office worker was frequently entitled to far more consideration than someone who had given 30 or 40 years' hard graft on the shop floor.
      The one part of the Bill, however, that I reject completely—the Minister will not be surprised to hear this, having probably read, though not yet heard. my comments in Committee on the Sex Discrimination Bill—is the concept of maternity payments. I welcome the Minister's invitation that there is still room for negotiation. T shall support any attempt to amend this provision. It is no part of an employer's brief to subsidise a couple's decision to have a family.
      I agree with the hon. Member for Rochdale (Mr. Smith) that if we want to pay four weeks' wages to a pregnant woman, society should make the payment. Certainly we should not make the woman sign a declaration in order to qualify for that payment that she will return to work after having had her child. At the time of signing she will probably be in no state to know whether or not she will be able to return.
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      I am old-fashioned enough to believe that a mother's place is in the home, and that if she were watching her children and bringing them up properly we might have fewer delinquency problems of the kind which haunt our country. I do not want a battery reared society, with children brought up like chickens in crêches or nurseries—although I would support any attempt to increase the number of crêches and nurseries because they relieve hard-pressed mothers for a short time when shopping and so on. I do not want to encourage the further growth in the numbers of "latchkey children". This provision in its own small way is another step towards undermining family life.
      With that major reservation, I give the Bill a cautious welcome and hope that my colleagues will join me in supporting it in the Lobby tonight.
      Several Hon. Members rose —
      Mr. Deputy Speaker (Sir Myer Galpern): Order. The House will be interested to know that the winding up speeches will begin at 9 o'clock, or in roughly one and a half hours. I estimate that about 12 hon. Members still wish to speak. If they could limit their speeches to seven or eight minutes—everything important can be said in that time: I have tried it myself and it has worked successfully—we could accommodate everybody.
      7.26 p.m.
      Mr. Tom Litterick: The main reason why any hon. Member should welcome the Bill is that it is another plea to employers, public and private, to accept that labour is not, and should not be regarded as, a disposable commodity. The sad fact is that through much of our economy that is how labour is still regarded.
      It is sad that a great party, the major Opposition party, should be seen to be saying that British employers cannot afford decent conditions for their workers. It is a simple truth that throughout Western Europe employers pay far more for fringe benefits, for what one might call "security of income", than do British employers. We also know, to our embarrassment, that they pay higher wages too. So there appears to be something very wrong with British employers, and it does less than service to the British economy for the Conservative Party to

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      argue that they cannot afford decent conditions on a par with average European practice.
      The Bill is a modest step forward to try to protect people from what has been called "future shock"—the shock of change, the devastation of private and domestic lives caused by technological change. Future shock has become almost an endemic disease of advanced societies and the Bill offers some small protection from it. It also offer something which is modest by standard practice throughout the developed world.
      Many firms will not readily accept the modest standards outlined in the Bill. They are mainly medium and small firms. In this House pleas have been made on their behalf to the effect that what the Bill demands will put them out of business. This is a self-destructive argument —an example of the British harming themselves again. We must insist that employers who will not voluntarily do so should offer decent conditions and we should put the power of the State behind that insistence.
      It is a long-standing tradition of the House and the British State that we wait for years—for decades—until we know just who will volunteer to do the progressive thing. Then the law moves in to take care of the laggards—the people who insist on getting their labour cheap and on employing labour in dangerous conditions. This is our interventionist tradition, and it is that tradition which the Bill follows.
      The failure of small and medium businesses is purely a reflection of the weakness of their financial and managerial resources, but it is our fault that we do not make available more co-operative arrangements for providing such businesses with the expertise they need. There are embryo organisations doing this, but the process needs to he greatly expanded.
      The attitude of small employers and of some larger ones is, unfortunately, still primitive. A dispute is continuing at Stirchley, in my constituency, in which an employer, when faced by a demand for trade union recognition, told his workers, "I will close down if you insist that I recognise your union". He may have been ignorant of the law as it stands, but his natural reaction was to threaten his employees with closure if they joined
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      a union. This is not untypical of thousands of employers, and is the reason for the Bill.
      We are talking not about a handful of employers or workers but of tens of thousands of employers and more than 40 per cent. of the entire work force. The unorganised workers and those who work for small employers are the ones who will be most positively affected by the Bill.
      In addition, the manual worker rather than the white collar worker will be the most beneficially affected, because the manual worker has been discriminated against consistently in the economic system by comparison with his white collar colleague. The Bill will go some way towards rectifying the more blatant discrimination between white collar and manual worker in the economic system.
      I have one or two small criticisms. The use of phrases such as "appointment to safety committees" is unfortunate. I do not know whether it is one of the absurd drafting errors spoken of by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) or whether it is a deliberate intention. but it should be made clear that members of safety committees are to be elected. We may wish to say that the members should be elected from trade union members, but that is quite different from saying that appointments to such committees should be made by and through trade unions. In the interests of industrial democracy the point needs to be made that such appointments will be made only by election.
      I echo the pleas that have been made on behalf of home workers. There are some in my constituency. I am not unaware of their lack of protection. I shall vote for the Bill happily, remembering that there is much yet to be done. This is a modest step forward. I look forward to more.
      7.33 p.m.
      Mr. Ian Percival: There is great irony in the situation today. For years I and other lawyers have listened to right hon. and hon. Members opposite shouting loud and long that the law and lawyers should be kept out of industrial relations. Yet in this Bill they seek to introduce the most extensive and detailed code of special laws we have ever seen

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      and have built into it self-contained and special provisions for its enforcement.
      The hon. Member for Birmingham, Selly Oak (Mr. Litterick) has welcomed that. As a lawyer I deplore it; for at least four reasons. First, right hon. and hon. Members on both sides of the House who have said that we cannot get good industrial relations by messing about with the law were right; and I wish those opposite had stuck to it. That does not mean that the law has no räle to play. Of course it has: it is the longstop. It must provide the remedies where only force would be available if there were no legal remedies. However, there should be the minimum, not the maximum, of law.
      Secondly, we must get back to the fundamental belief that the law should be the same for everybody and that we depart from it and should have special laws for special categories only when there is a really strong case for doing SO.
      Thirdly, we must return to the belief that where there are justiciable matters to be decided that is what the courts are for. We must stop creating new tribunals every time we have legislation like this to do the very job for which the courts exist.
      Fourthly, we must remember that the purpose of the law is to protect the weak from the strong, not to give more strength to the already strong. My hon. Friend the Member for St. Marylebone (Mr. Baker) was right in saying that the Bill represents a significant shift of further power to the already powerful.
      I want to say something about the new set-up of "courts" provided by the Bill. There is the Central Arbitration Committee, with immensely difficult and important judicial functions to perform. I have not yet been able to see what right of appeal, if any, there is from that body. Perhaps the Ministers will tell us that.
      The Certification Officer has some very important questions to decide. They are such important questions of law that, as the hon. Member for Birmingham, Perry Barr (Mr. Rooker) said, they may well be the subject of litigation. Rightly, the appeal in such case is to the judges, because what the judges will have to decide
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      is whether as a matter of law the unions concerned are independent unions as defined in the Bill.
      The "service" has some judicial functions to perform.
      The Employment Appeal Tribunal has the wide and important functions already referred to. I want too to say something about the new grounds of complaint to the industrial tribunals. Right hon. and hon. Members opposite were very critical of the unfair industrial practice concept which was introduced in the 1970 Act and of the fact that unfair industrial practices could be the subject of a complaint to the industrial tribunal. I have not managed to count them up, but the Bill creates a considerable number of new grounds of complaints to the industrial tribunals, just as if more "unfair Indus trial practices" had been created. I ask the Minister to say how many new grounds of complaint to the industrial tribunals are introduced by the Bill.
      Has the Minister really considered the details of Clauses 10 to 21 and provisions like Schedule 10? Does he not think that we are introducing here a highly stylised approach, one that may well lead to the type of "ritual dance" that there is in the American labour relations set-up which creates new problems at every stage and may give rise to very difficult questions of law?
      Has the Minister considered Clause 15 and the kind of complaint that may be referred to the "service" about whether a recognition recommendation is being complied with? Has he considered that he may be introducing there the concept of bargaining in good faith which has caused so much litigation, uncertainty and difficulty in American labour relations?
      The Bill is very one-sided in the giving of rights to various people. The Minister has been asked this question already, so I will put it to him again briefly: why should not an employer have the right to refer a recognition dispute to the "service"? He may have every bit as good a reason for doing so. It is so silly to make it one-sided.
      But we are not thinking only about employers. What about the non-trade unionists? Under the Bill a Member of a trade union will have the right to go to an industrial tribual if he thinks he is

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      not being accorded his rights. What about a non-trade unionist who thinks that he has been badly dealt with by a union? Why should not he have some consideration as well?
      We have heard over the years of the TUC's intention to deal with this matter, to follow up the Donovan recommendation. It is time that more consideration was given to the non-trade unionist. We are beginning to be rather suspicious that because, ex hypothesi, he does not have a union to speak for him he will not get much by way of help unless we keep pressing and pressing. I can assure the Minister that we shall do exactly that.
      May I now say a word about Clauses 99 and 100. I intervened on the question of picketing, which is dealt with in Clause 99, when the hon. Member for Newton (Mr. Evans) was speaking. He said that the Government must go further than they appear to go here and that it is necessary that pickets should have the right to stop anybody and talk to him. Although he did not answer the question which I put to him, it appeared plainly that he was saying that pickets should have the right to stop a person and talk to him even if that person did not want to stop and be talked to.
      I do not think Clause 99 gives pickets that right, but I should like to hear the Government's view. The feelings of many people would be allayed if we could hear from the Government that it is not their intention so to make the law that a person lawfully on the highway may be stopped against his will and should have to listen to somebody's case when he does not want to do so.
      Mr. Harold Walker: This is the Government's intention.
      Mr. Percival: "This is the Government's intention", says the hon. Gentleman, waving the Bill. I do not know whether he was listening when I asked the Minister of State what he thought Clause 99 meant. The Minister of State very wisely ducked that question, because Clause 99 as it stands is not clear.
      Mr. Harold Walker rose —
      Mr. Percival: No, the hon. Gentleman will have half an hour in which to speak
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      later in the dabate. I shall wait with eager anticipation for him to tell us what Clause 99 means.
      Mr. Harold Walker: the hon. and learned Gentleman must not allow his inability to understand what my hon. Friend said to cloud the issue. My hon. Friend made it clear in his opening speech that the purpose of Clause 99 is to remove any doubts which were raised in the case of Broome v. Director of Public Prosecutions. It was the uncertainty which arose in that case which made it necessary to put this clause in the Bill.
      Mr. Percival: I should like the hon. Gentleman to say how it removes uncertainty. Let me first identify the uncertainty and then say how it is removed. I am blessed if I can see it.
      The hon. Member for Newton said that these further rights must be given to pickets because pickets would resent not having them. I hope it is beginning to percolate through that other people may feel resentment when their rights are impinged upon. If pickets are given the right to stop other people, even though those other people do not want to be stopped, those others will strongly resent being put upon in this way.
      In connection with Clause 100 I wish to draw attention to the fact that there are many people who resent what is happening in the matter of unemployment benefit and supplementary benefit for those on strike. It gives great offence to many people that people working a four-day week may, together with supplementary benefit, earn more than those who are working a five-day week.
      Clause 100 is designed to make it easier for a person who is out of work because of a trade dispute to get unemployment benefit or supplementary benefit for himself. I do not deny that there may be cases in which there is need for an improvement in the situation as it is, but I warn the Government that it gives great offence to the people put to inconvenience by the people who are on strike that those who are on strike should be maintained at their expense by means of supplementary benefit. It really adds insult to injury.
      In order to keep within your time ruling, Mr. Deputy Speaker—
      Mr. Deputy Speaker: The hon. and learned Gentleman has pretty well exceeded it.
      Mr. Percival: Only because I was so unwise as to give way, Mr. Deputy Speaker.
      In addition to my complaint that this Bill is far too legalistic, my other main complaint is that I do not see how it will protect much less create a single job. What is needed is for the great trade union movement to get on with the tremendously important räle of playing its part in bringing about greater efficiency right through the industrial life of this country. Everybody owes this country that duty—management, trade unions, workers, all of us. That is the task upon which this great movement should be concentrating. That is the task on which the Government should be engaged in persuading it to concentrate—not on the mass of detailed legal provisions of which the Bill consists.
      7.46 p.m.
      Dr. Jeremy Bray: I do not wish to spend any time dealing with the Opposition attack on the Bill. It seems to me that they regard the world of industry as consisting of the managers and the managed. We are all employees today. Surely the greater the rights we have as employees the better for us all, unless the giving of those rights wrecks the economy. We should be united in the House in maximising the rights of employees.
      I wish to deal with the overlap with the Industry Bill. My hon. Friend the Minister of State said that the measures in this Bill complement the Industry Bill. I think that is perhaps overstating it. They overlap. I am not worried about that. I am not even worried about competition. What I should like to see is integration of the measures, so that they offer the maximum improvement possible to industrial relations and to the effectiveness of industry, and indeed workability, when viewed from the shop floor.
      No other hon. Member who was on the Standing Committee on the Indnstry Bill has spoken in the debate. I am glad to see the hon. Member for Caernarvon (Mr. Wigley), who I hope will speak at a later stage. The Employment Protection Bill calls for the disclosure of all information which a firm has and which
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      is relevant to collective bargaining. The Industry Bill also calls for disclosure of a very wide range of information relating not only to the present but to future plans. The Employment Protection Bill offers guidance on disclosure through the publication of a code of practice from the Advisory, Conciliation and Arbitration Service. The Industry Bill offers no such guidance but has planning agreements in the background. The disclosure in the Employment Protection Bill is to trade union representatives. It is also to trade union representatives in the Industry Bill, through the mediation and initiative of the Secretary of State. The appeal against disclosure in the Employment Protection Bill is to the Central Arbitration Committee. In the Industry Bill it is to an ad hoc committee.
      In the matter of enforcement, in the Employment Protection Bill a claim can be made a part of the contract of employment by the finding of the Central Arbitration Committee, a cunning device. A firm is told what it has to pay its workers if it does not agree to disclose information to them, a formidable sanction. In the case of the Industry Bill the firm is merely fined. As for breach of confidentiality, there is no confidentiality attaching to information disclosed under this Bill. Under the Industry Bill it is an offence for information given to the Secretary of State to be disclosed further, but not for information given to trade union representatives. In both Bills the disclosure arrangements depart from the provisions of the Company Acts. They also depart from the provisions of the Statistics of Trade Act. Both Bills would have been strengthened had a thorough disclosure system been thought out before the Bills were drafted.
      My plea is to combine the strong features of disclosure in both Bills, to make the disclosure more effective and more useful to the people on the shop floor. I suggest that in Committee it may even be possible to adopt the wide range of disclosure outlined in both Bills but to put it on to a compatible basis and to require the disclosure of plans as well as of present information under this Bill.
      The idea of a code of practice is excellent, but a code of practice should not be produced only by the Advisory, Conciliation and Arbitration Service, which

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      is not equipped to deal with the wide range of issues raised under the Industry Bill. The code should be provided by the Government themselves, the Departments acting together.
      Both the trade union representatives and the Secretary of State should be able to take the initiative in requiring disclosure of information. As regards appeal, the Central Arbitration Committee is unlikely to be constituted to be able to deal with appeals against disclosure on the wide range of matters raised under the Industry Bill, and an ad hoc committee would seem best equipped to deal with disclosure over the whole field, including disclosure under this Bill.
      The idea of the sanction, of its being in the hands of the employees to exert the final sanction by making a claim, that claim being recognised by the Central Arbitration Committee, is ingenious. I should like to see that used also in the machinery of the Industry Bill.
      I turn next to the major set of clauses on redundancy. Again, one sees the need for greater integration of the two Bills. Under the present Bill as drafted, the employees in a firm can demand notice, notice and yet more notice of redundancy —they can huff and puff, but they will still he sacked. In opening, the Minister of State said—the Chancellor of the Exchequer foreshadowed it in his Budget Speech—that provision would be made for the maintenance of employment through payment of funds to a firm to enable it to defer redundancies. But far wider issues than that are likely to be involved.
      There are 20,000 employees of the British Steel Corporal ion today who have been threatened with the sack by the Chairman of BSC. He has talked about a 50 per cent. rundown in the strip mills division. The background is that car sales are down slightly—10 per cent. or 15 per cent—car showrooms are overstocked, and production is down more. When this repercusses through to the steel industry, it is amplified and a ruthless chairman talks about 50 per cent. redundancy—a lunatic escalation—and it requires a range of issues to be brought into the argument which, frankly, are far beyond the scope of the Advisory, Conciliation and Arbitration Service or the Department of Employment and call for
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      the full apparatus of the planning agreements under the Industry Bill and of the Departments of Industry and of Employment working together, with the Treasury.
      Such a range of measures requires a wider spread of issues and a wider range of firms to be taken into consideration in dealing with a redundancy situation; and it requires also a greater span of time. By the time the point is reached of a firm wishing to make workers redundant, it is probably too late to take more than palliative action. The action should have been foreseen much earlier when the Government were taking measures which influenced demand, or earlier when the firm was making plans for the introduction of new products, or earlier still when it was considering the type of industrial capacity in which it should invest.
      I hope that my hon. Friend the Under-Secretary of State, for whom I have the greatest respect, will be able to assure us that the House will have greater time to consider these matters in Committee so as to produce some mutual reconciliation and reinforcement of the two Bills at that stage.
      7.54 p.m.
      Mr. David Mitchell: I am glad that the hon. Member for Don-caster (Mr. Walker), the Under-Secretary of State to reply to the debate tonight because I know that he cares greatly about the problems to which the Bill is directed.
      However, I regret the absence of the Secretary of State. We wish him a full recovery, but I wonder why he had to enter hospital today, the day when his Department was to introduce a major Bill of which he is the author. Is it that his bed came up and, like every other National Health Service patient, he could not wait and had to take it? If that is the case, perhaps he might be invited to join BUPA, to which many of us belong so that we can fulfil our parliamentary duties with the timing best suited to them.
      The Under-Secretary of State for Employment (Mr. John Fraser): Pretty cheap.
      Mr. Mitchell: When the Industrial Relations Act was repealed, I said that I expected most, if not all, the major provisions of that Act to be restored in my

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      lifetime by one Government or another. Little did I expect that so much would so soon be brought in by this Government. To that extent, I welcome the Bill. Much of the code of industrial practice is here re-enacted. All the disclosure provisions are here, which I am glad to see, for there is nothing like misunderstanding and rumour to cause disputes in industry, and disclosure to employees can do nothing but good.
      It is a large Bill. In one piece of legislation we have industrial relations, employment agencies, training, and safety and health at work. With all respect to the Government, there is too much in the Bill. These matters would have far better attention in Committee and be much better attended to by the House if there were separate pieces of legislation dealing with each of those items.
      However, the Bill confers a considerable number of benefits on trade unions and workers, and this will, of course, be built into the cost structure of industry. The question is whether now is the time for increasing costs and increasing prices. How do we balance what is socially desirable with what is economically practicable? The Government remind me of the captain of the "Titanic", at full steam ahead for the icebergs and rocks of devaluation and unemployment, for that seems to be their policy—to pile extra costs on to industry regardless of the fact that it cannot afford to meet them.
      The hon. Member for Birmingham, Selly Oak (Mr. Litterick), in an interesting speech, drew attention to the fact that we have the lowest wages in Europe, and he asked why, that being so, industry could not afford to fulfil the terms, conditions and requirements proposed in the Bill. The answer is that in this country we have less capital behind each worker than the countries of Europe have, so that each worker is bringing in less profit to his employment and to his firm, and, therefore, his firm is less able to pay for the sort of standards of working conditions, pay and other benefits which one would wish to see.
      The answer lies with the Chancellor of the Exchequer, not with the Department of Employment. Having drained industry of its working capital, he cannot be
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      surprised if industry has not got the money to invest to enable each worker to bring in enough money to his firm to pay for the benefits we want to see.
      The Bill presents that problem, the problem that it piles additional costs on industry, but I wish to direct special attention to the way in which it deals with small businesses. I hope that the Under-Secretary will tell us what representations with regard to small businesses both Ministers and his Department received during the preparation of the Bill and following the White Paper. My information is that small businesses are exceedingly concerned about what faces them.
      The purpose of the Bill is to improve industrial relations. The Minister will know perfectly well from his departmental statistics that small businesses have far better industrial relations than do large firms. There is much greater understanding, there is flexibility and there is give and take. We do not improve that spirit and atmosphere of give and take by formalising and putting into legislative form minimum rights which, more often than not, would be worked out between employer and employee on a personal basis. Indeed, we were told many times during the passage of the Industrial Relations Act by Labour Members, including those who are now Ministers, that work practices could not be formalised or put into law. Yet here is a Bill which does just that. I fear that creating an entrenched position on one side will lead to the same sort of attitude on the other, and that is not good for industrial relations.
      Small businesses face three particular problems, and I hope that the Minister will give his attention to these. First, there is the question of maternity and the guarantee that a woman can have her job back after she has had her baby and can be paid for maternity leave. I raised earlier the question of a Member of Parliament's secretary. There is no cut-off, and the provision, therefore, applies to the one-man business where there is perhaps only one secretary. It is unrealistic to assume that in that type of organisation a man can temporarily take on someone else and then guarantee to take back the original employee.
      There are countless jobs where women do essential and skilled work that takes

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      months to learn. No one will bother to learn that job in the certain knowledge that after nine months she will get the sack, because that is what would happen. In a small business a stock control clerk, an invoice clerk or an order clerk has to know the specialised range of commodities that the firm deals in. An MP's secretary has to know the Member's constituents. In addition to all this there is to be a payment towards maternity. I believe that that should be borne on the social services and not by the individual employer.
      On the question of lay-offs, it is unfair that because a strike takes place in another firm an employer should have to pay the wages right the way through for his own employees. A small firm could be bankrupted in such circumstances. These days industry is far more integrated than it was. A dispute in one firm could have a general reaction right down the line among firms which use parts produced by that firm. How much, I wonder, will the losses of British Leyland be increased over the next few years in meeting this burden. If that is the effect on a large firm, it is not difficult to imagine what it will mean for the small firm.
      There is also the question of time off for various forms of local government service, work on the magistrates' bench and so forth. This sort of thing is arranged on a flexible, commonsense basis, where the employer and employee work out how it can be practicable to do a particular job and sit on the bench or serve in local government. Now, instead of that commonsense approach, there will be an absolute right. What will happen? Take the example of my right hon. Friend the Member for Lowestoft (Mr. Prior), who farms. Suppose his cowman tells him that he is going into local government and that at milking time one day a week and, depending on committees, on certain other days, he will not be at work. Do my right hon. Friend's cows not get milked?
      Mr. Clemitson: The right hon. Gentleman should do it himself.
      Mr. Mitchell: It is all very well for the hon. Member to say that my right hon. Friend should neglect his parliamentary duties. That may be the hon. Gentleman's wish.
      Mr. Bob Cryer: Some of us actually concentrate on our parliamentary duties to the exclusion of having about one hundred acres to farm. Is it not about time that right hon. and hon. Members concentrated on their parliamentary business to the exclusion of outside business interests?
      Mr. Mitchell: My right hon. Friend is well known for giving his full time and attention to this House and to parliamentary business—
      Mr. Prior: I may not talk as much as the hon. Member for Keighley (Mr. Cryer) but I make more sense.
      Mr. Leon Brittan: He is better at milking cows, too.
      Mr. Mitchell: The hon. Member for Keighley (Mr. Cryer) will be aware that a number of his hon. Friends are engaged in farming enterprises, and so forth, and employ cowmen, and that they, two, would face this problem. What about the licensee of a pub who may be a manager licensee? Does he say to his employing brewery "I am sorry; I am opting out because there is a council meeting"? In law that man is charged with the responsibility for what occurs on those licensed premises. One could go on finding cases where common sense and not the law must be applied. Surely the Government will have to make changes on this point.
      In introducing the Bill the Minister of State gave a very interesting statistic. He said that the Bill would cost a mere £105 million a year. He said that that was not a serious problem, that the average cost was, therefore, only £5 per man per year. I do not know how a man can become pregnant, but that was the average cost that the Minister indicated. He worked out that the cost would be 10p a week approximately. A large company would incur the average cost, and it could afford to pay. A small business, however, where there are 25 employees or fewer, will not incur the average cost. If one of the situations I have been describing arises the expenditure for that employer becomes very large. It will not be £5 a year. It will be a very substantial sum. It will be arbitrary, unpredictable and uneconomic Under existing pressures many

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      small businesses are folding up. They already face unfair treatment under the national insurance legislation, with the further turn of the screw that is involved for the self-employed. It will add to the rising number of bankruptcies among small businesses.
      This legislation is desirable in itself, but when it is added to the other burdens it becomes intolerable to the businesses which are caught by it. The Government will have to think again about a minimum cut-off point for firms affected by these proposals.
      8.9 p.m.
      Mr. Eddie Loyden: Conservative Members have concentrated on the question whether we need the Bill. I remind them that it is part of a general strategy and is very much connected with the Industry Bill. It covers the whole field in which the Government have been active since February 1974. At that time they were motivated to take action by what had happened in industrial relations as a result of the disastrous Industrial Relations Act and the chaos it caused. As a result of that Act there was a breakdown in industrial relations, which reached their worst state since the 1920s and 1930s. We have to consider this Bill against that background.
      According to Opposition Members, the trade union movement is in full command of the commanding heights of industrial activity, and is so powerful that it can put right any imperfection in industrial relations tomorrow. There are sections of the trade union movement that have formed themselves into groups out of sheer necessity, that are prepared to fight for conditions and wages that they regard as justified. But there are whole areas in industry that still lag behind.
      In my constituency there are still places that would be recognised as sweat shops, where young people and women are exploited. Throughout British industry there are countless hundreds of thousands of workers who are deprived of minimum protection.
      I cite one instance from my own constituency. It concerns a modern factory, not slotted down a side street, but built as an advance factory some years ago.
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      Women report to work there on the basis that when they get to the gate the management decides whether they are required. That is how labour was hired 40 or 50 years ago and it still prevails in a society that claims to have made tremendous advances in industrial relations.
      The work is arduous and the women work in water that is sometimes knee deep. They do not know whether they will be allowed to work that day until they reach the factory gate. It is only with the consent of the management that they are allowed to work.
      These conditions are not the fault of any trade union agreement. Sad to say, this is not a trade union organised work force. Indeed, that shows the need for workers to be organised in a trade union. In the end, that is where the main responsibility must rest.
      I consider the Bill in the context of the Government's general strategy. A number of its provisions are essential and should have been enacted some time ago. Industrial relations have always been regarded as concentrating on wages and conditions, and employer responsibilities have begun and ended at that point. However, as some of my hon. Friends have pointed out, in other European countries there has been a dramatic extension of employer responsibility for other aspects of the life of an employee.
      The Bill sets out on a course that will bring a whole number of new responsibilities within the ambit of industrial relations. For many sections of workers that reform is long overdue. For instance, so far as I know there is not a factory in the country that provides nursery accommodation for its women workers. That should be among the responsibilities of an employer.
      I am astounded that Opposition Members should come to the defence of the small business man in this connection. One begins to suspect that their case is not that he cannot afford the cost of this limited Bill but that they wish to shield him from meeting his responsibilities to those he employs. Yet these small business men are, in the main, those who disregard their responsibilities towards their employees.
      Opposition Members have also spoken about the need to consider district or area

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      wage levels, but I remind them that there is a good system of voluntary wages tribunals that for many years, since shortly after the First World War, have used the criteria of district wages. No new experience is required to compare the wages of one company with the area wages to see whether they are fair.
      The Bill will not resolve all the current problems in British industry. We have a long way to go to achieve that goal. There will have to be a dramatic change in general policies before then. But certainly the Government have started on the course. This is a Bill not to clobber the trade unions and to ignore the imperfections, the wrongs and the injustices in industrial relations, but to take the first steps in the process of creating the climate in which industrial relations will be improved. We hope that it will be the beginning of a forward-looking policy.
      8.17 p.m.
      Mr. Leon Brittan: The Secretary of State is, sadly, not with us but he has left us a message. He is reported as having said at the Labour Party conference that his dearest ambition was to stay at the Department of Employment until he could see the appalling unemployment figures come down. The main reason why I am opposed to the Bill is that, applying that test, it will further prolong the Secretary of State's tenure of office. So far from reducing unemployment, it will increase it. To describe the Bill as the Employment Protection Bill is a flight of Orwellian double talk. It should really be called the Employment Destruction Bill, because that will be its effect.
      I have no doubt that the intentions behind it are sincere, but we all know the destination that those who have good intentions sometimes reach. In this case they will reach that destination because the Bill is based on a fundamental economic fallacy. It is based on the idea that if high statutory requirements relating to terms and conditions of employment are imposed, it will be the employee who will benefit. That is by no means the whole picture. Some people will certainly benefit, but others may find themselves out of a job as a result, or not taken on when they might otherwise have been.
      Why are there such wide variations in the terms and conditions of employment?
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      It is not just because some employers are beneficient and others are not. It is not even because sometimes the trade unions are weak and on other occasions are strong. It is often because one company is highly successful for a whole host of unrelated reasons and is, therefore, able to offer excellent conditions, while another company is much less successful and able to offer employment only on less attractive terms. If we insist that those terms are improved, the effect may well be to drive the company out of business, or at least to compel it to reduce the number of people it employs.
      If the conditions at work are barbaric it may be better for the firm to close down and for the work people to be supported by the State. We are not talking about that situation. We are talking not about a Bill designed to stop children under the age of 10 from working in the mines but about a Bill that purports to extend a whole host of benefits provided by some of our most successful companies right across the industrial board. The result will be that fewer people will enjoy better conditions.
      That is entirely in line with the Government's economic policy. By allowing huge wage increases that have not been earned, more and more people are being priced out of a job. It is in that context that the Bill should be examined. It may be consistent with the rest of the Government's policy but to call it an Employment Protection Bill is to enter the world of "Alice Through the Looking-Glass". One of the best illustrations of the working of this Bill is provided by Clause 88 and Schedule 10, which permit the Central Arbitration Committee to require an employer to raise his employees' wages to the general level observed for comparable workers by employers in the district concerned.
      Mr. Jack Jones is reported as regarding this provision as the first step in a major campaign to raise the wage levels of low-paid industrial workers to the wage levels of the best. There is no doubt as to the divergence of the wages in different firms. I have an analysis of the latest figures in the engineering Industry in the Tees and Hartlepool area. For a litter the average wage for a 40-hour week, including threshold payments, ranges from £37·81 to £56·50. For a plater it ranges from

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      £46·50 to £61. For a welder, class 1, it ranges from £45–90 to £61. The significant point is that in every case it is the big employer who is paying the high wages and the small employer who is paying the low wages. If this Bill is enacted and is used as Mr. Jones would like it to be used wages will be forced up to the average level. That will produce a new average, and the leap-frogging inflationary procedure will begin again. The effect will be that small firms will simply not be able to compete.
      The situation is rendered worse by the fact that, at least in that area, work that has to be taken into account includes work concerning North Sea oil installations, where there has already been an upper wage level which makes it difficult for small employers to compete. The result will be increased costs, increased inflation and unemployment, just as we are seeing in the economy as a whole, as a result of the Governments' policy.
      This is not the only provision of the Bill which has that effect. Many others that have been mentioned operate in the same way—the guarantee payments, maternity pay, time off. They all affect the small employer. They all make it more difficult for him to offer employment. They will lead not to the protection of employment but to the reduction and destruction of employment. If the Chancellor were proposing this Bill as part of his policy of a shake-out of labour I could understand it. But the context is quite different. This Bill is presented as an Employment Protection Bill. Whatever else it is, it is not that.
      The Bill is part of a package deal by which more power is handed over to the trade union movement. It is significant that again and again it is not the worker who benefits but the trade union. It is ironic that the unions should be so shortsighted that in asking for all this and in welcoming it they are happy to see resurrected a new framework of law different in name and policy but not so different in structure from the much-aligned Industrial Relations Act. We see the legal framework being woven yet again.
      My basic objection to the Bill is not that it is another example of giving still more power to the unions, nor even that it is the resurrection of legal machinery
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      in such a hypocritical form. It is that by calling what ought to be an Employment Destruction Bill an Employment Protection Bill the Government are entering what is even by their standards a new top league of double talk and adding still further to the unemployment that their other policies have already created
      8.25 p.m.
      Mr. John Watkinson(Gloucestershire, West): I do not wish to emulate the hon. Member for Cleveland and Whitby (Mr. Brittan) in his somewhat hysterical outburst over this rather mild Bill. I give a broad welcome to the Bill. We have heard from Tory Members that one of their principal complaints is that the Bill introduces yet more legislation into the industrial area. I welcome legislation in the areas delineated by the Bill because it means that through the operation of such legislation we shall be able to reach those areas of society which, without legislation, would not be dealt with by a voluntary system for decades.
      I particularly welcome the temporary employment scheme. Perhaps the hon. Member for Cleveland and Whitby did not hear that. This is an imaginative scheme, which is vital in view of the recently announced unemployment figures. With unemployment rising at its present rate it is clear that the coming winter will be an extremely serious one. There is no point in anyone thinking that we can use unemployment as a means of wage control.
      Obviously wages have to be brought under control, but only by the grossest and most unimaginable levels of unemployment would it be possible to bring down wages. Therefore, I welcome the scheme to bring into productive enterprise men who would otherwise be laid off. We have heard from the Chancellor that it would cost over £900 million a year to keep 1 million men unemployed. That is a waste of the basic resources which we require to produce the output needed at home and for exports.
      I want to consider the problem of picketing—a problem which remains in spite of Clause 99. The right to inform and persuade in a peaceful manner is an essential extension of the right to strike. The question is the degree to which individual pickets and trade unionists should be allowed to exercise

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      that right. During the course of this century the law has basically been enshrined in the Trade Disputes Act 1906. The principle underlying that Act was that in furtherance of a trade dispute it was lawful for a picket to attend for the purpose of peacefully obtaining or communicating information, or of peacefully persuading any person to work or not to work.
      A basic dispute has arisen between the courts and the trade union movement. The courts have laid increasing emphasis on the fact that the right conferred under that Act, and under the Industrial Relations Act 1971, is a right of attendance, whereas the trade unions wish to utilise the opportunity of picketing to convey information and, if necessary, to stop people from attending. A series of decisions in the courts has undermined the trade union position to the point that, in the recent judgment in Hunt v. Broome, it was held that under the existing legislation there was no right to stop any person or any vehicle in order to persuade that person or the driver of the vehicle of the correctness or otherwise of a strike. It was held in the first instance by the magistrates that pickets should be entitled to do so, but the Law Lords held that there was no such right under the legislation.
      However, according to Lord Reid, there was a right to attempt to persuade someone, who said that the position of a picket was similar to that of a hitch-hiker—in other words, he could stop on the side of the road and advertise himself and if the person who came along wished to stop, that person could be addressed and persuaded. But there was no means open to a picket to stop someone and say, "This is what I wish to say to you". That decision was emphasised in the case of Cavanagh v. Hiscock, when the Lord Chief Justice confirmed the decision in Hunt v. Broome that there was no right to stop.
      Therefore, trade unionists seek the right to stop to persuade, but the Acts do not presently give it. As I interpret Clause 99, if my hon. Friend the Minister of State is right, the Government are legislating the view of Lord Reid in the decision in Hunt v. Broome that trade unionists should have the right to persuade, in the words of the Act,
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      "by peaceful means falling short of obstruction".
      How can one seek to persuade
      "by peaceful means falling short of obstruction"?
      That is the difficulty which will confront trade unionists, and which needs clarification.
      I understand the problem about legislating to allow trade unionists to stop other people and to stop vehicles. Let us suppose that there was a strike in Oxford Street and shop girls had the right to stop vehicles. There would be pandemonium. Obviously there are difficulties about the site. There will be difficulties about the infringement of personal freedom, though it may be suggested that it would be possible to stop an individual for a reasonable time so that a view might be put to him.
      Therefore, perhaps what is needed—it has been suggested—is a code of practice enabling the Government and the TUC, with the co-operation of the police, to come to an agreement whereby approved, accredited pickets would be able to stop people for a reasonable time to present their case and, having done so, allow those people to pass on their way. I hope that the Government will consider the possibility of introducing a code of practice in this area, because I do not believe that Clause 99 takes the matter any further than the decision in Hunt. This is a long way from what trade unionists would seek.
      The only other matter to which I wish to refer is the question of the Shrewsbury trial. I do not want to go into any of the matters raised by it, but it is appropriate to draw attention yet again to the fact that trade unionists are concerned about the operation of the conspiracy laws as they apply to trade unionists when they gather together for the purposes of picketing. The operation of the conspiracy laws in this area is in itself offensive, and in one sense it is perhaps sad that the previous case did not go as far as the House of Lords, so that their Lordships could rule on the question whether conspiracy was an appropriate charge when linked with intimidation under the 1875 Act.
      There were, however, elements in the case—such as the fact that the judge was

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      able to use the common law to impose a particularly severe sentence, and the fact that on evidential grounds the prosecution was able to bring evidence which it would not have been able to bring in other circumstances—which caused concern in the wider area and in the area of trade unionists.
      I appreciate that the matter I have just dealt with cannot be considered in the context of the Bill. However, I hope that there will be some attempt to clarify at least the picketing practices.
      8.36 p.m.
      Mr. Dafydd Wigley: I shall not deal with the details of what the hon. Member for Gloucestershire, West (Mr. Watkinson) said, save to say that I agree with what he said about the Shrewsbury case. There is room for grave misgivings about the way the conspiracy law was used in that case, and I do not believe that it was intended to be used in that way. There are misgivings in many circles within the country not only about that specific case but about the general context as well.
      The hon. Member for Motherwell and Wishaw (Dr. Bray) referred to the Bill's impact on other legislation which the Government have in hand. He referred to the Industry Bill that is currently in Committee, and tried to contrast different parts of the two Bills. In many ways it is regrettable that it was not possible to bring forward the whole batch of industrial legislation at once. I appreciate that in practice that would be very difficult for the Government.
      The Industrial Democracy Bill, which we have yet to see, could be the key to many of these matters. It could be the piece of legislation that will complete the jigsaw. It is difficult to evaluate the jigsaw until we have that piece.
      Although small, the Industry Bill was heralded by many of the people in the media as an extremely controversial issue. I have had much more correspondence concerning this Bill than about the Industry Bill. A lot of that correspondence is misguided and based upon fallacies. None the less, it exists. A lot of it is part of the backlash from the previous industrial relations legislation, and there is a feeling that the pendulum has swung from one side to the other. It will be
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      extremely regrettable if escalating polarisation is to take place in industrial relations.
      As many hon. Members have said, we cannot legislate for good industrial relations—we can only provide the basis. It is valid to say, as hon. Members have said, that over the years in these islands the best practices of the enlightened employer have been built into a legislative structure. If that process is developed in a manner that cuts corners, and if it is developed too quickly, it can give rise to reactions similar to the reactions to the measures brought forward by the previous Conservative Government.
      The Bill has a relevance in Wales. We have had to face the effects of redundancy and unemployment. It sometimes makes my blood boil to hear the sort of remarks that we heard not so long ago in the Chamber about this being a Bill that will create unemployment rather than employment. Anyone who has seen people of the age of 50 or 55 thrown on the industrial scrapheap, as they are in many parts of these islands, with no alternative employment open to them, treated as dispensable inputs into an industrial machine, cannot help but feel extremely angry. There is a need to ensure that the safeguards within the community give the maximum possible protection to those persons least able to help themselves in these terms, as well as in so many other terms within a Welfare State.
      The Bill can be regarded to a large extent as a safety net to protect those who are employed perhaps in the more dubious works by the more dubious employers. Many of the more enlightened employers follow the practices in the Bill. Many companies have moved for guaranteed weeks. I am thinking in particular of the engineering industry. But many other concerns lag behind. There is a need for the Bill in order to ensure acceptable minima in those concerns. It is unfortunate that some of the better employers have been protesting about some of the clauses, because I do not believe that those clauses were aimed at them. I do not think that the better employers have much to fear from most of the provisions of the Bill.
      However, there are one or two specific matters to which I wish to refer. One is the provision concerning a woman's retention of a job when she leaves to

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      have a baby. There are great practical difficulties, particularly in the smaller concerns. I come from a rural area. If a person obtains a job there he regards it as an achievement, because the alternative is often to move to look for a job elsewhere. If women leave for maternity reasons, and the job is temporarily allocated to someone else, all sorts of social pressures will result.
      We should carefully consider whether we should be making such provision in this Bill. Is our objective right? Should it be the objective of an enlightened social and industrial policy to urge women who have just had babies to return to work at the earliest possible opportunity? We should be aiming at the sort of Welfare State and social services that can ensure that there is sufficient support, particularly for the one-parent family, the mother by herself, on whom there is the greatest pressure, so that she does not have to return to work. Her child is utterly dependent on her. Therefore, I question both the premise of the provision and its practicality.
      There have been several references to the effect of the Bill on small companies. It needs to be underlined that there will be difficulties for the company employing six or seven people. Many a manager must be a general factotum, the buyer and the seller, the director of production and the obtainer of goods. To ask such managers also to be legal experts, having to deal with many of the bureaucratic strings that inevitably come with such legislation, may be to impose too much of a load. It could cause many difficulties.
      There is another aspect that worries me. In my constituency there are many seasonal workers. Unfortunately, the economy is geared to seasonal working. I suspect that some of the provisions of the Bill could cause problems to seasonal workers. I shall be grateful if the Government will keep their mind open on this problem.
      Mrs. Winifred Ewing: Will the hon. Gentleman bear in mind that the problems are not always just for the workers engaged in seasonal work, and that there are also problems for their employers? For example, those using fruit are dependent on whether the farmers supply the goods so that the work
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      may be done. I have such a concern in my constituency—Baxters, which will be known to all hon. Members—which is always dependent on the fruit arriving, which is something over which the firm has limited control.
      Mr. Wigley: I accept the hon. Lady's point. There are problems in both directions. Provisions are necessary for the temporary seasonal employee, perhaps amounting to more than is in the Bill. There are also practical difficulties from the point of view of the employer.
      The hon. Member for Motherwell and Wishaw and others have spoken about disclosure. Only a few days ago I was talking to a German industrialist about the controversy over disclosure. He was amazed, and thought that industry in Britain was making far too much play of the dangers of disclosure. He believed that there was much more to be gained than lost from developing as open as possible an industrial community.
      The trade union räle under the Bill has also worried some employers who have written to me. There is a feeling that possibly the trade union has more access to some of the bodies set up by the Bill. But in many instances the powers of initiative rest with the employer, and often the trade union needs the ability to appeal, because it cannot take initiatives of the type which are open to the employer in the first place. It is right to maximise the opportunity for trade unions to go though this sort of procedure because it encourages them to adhere to constitutionality, which is the basis of good industrial relations.
      I refer, finally, to the long-term aspect. The Bill should be regarded as part and package of a move towards greater economic planning in the broadest possible context. That requires stability of the work force and stability of the economy. Therefore, it is necessary to regard the Bill side by side with the Industry Bill that can provide the jobs and the Industrial Democracy Bill that can give motivation in seeking to ensure that there are also safeguards for employees of industry in the counties of these islands.
      8.45 p.m.
      Mr. Ivor Clemitson: It is not for us to try to eliminate conflict;

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      it is for us to try to eliminate destructive conflict and to create the conditions in which constructive conflict can occur. I do not wish to minimise the importance of strikes and other forms of industrial action. We should try to reduce their number and their impact, but if we regard that as the sole objective of our policy our efforts are negative and must be misconceived.
      To deal for a moment with the elimination of negative conflict, as anyone with experience of industrial relations knows, industrial disputes do not have single, simple causes. Their causes are complex, and some of the most important of them are so deep that they are never described or articulated. Lying behind many disputes is a deep feeling of insecurity, fear about loss of jobs, fear about losing money, fear about one's employer going bust, and so on. Insecurity is one of the major unwritten, unrecorded causes of industrial disputes. If we want to do something about reducing negative conflict, we are well employed in removing one of the basic causes, which is insecurity, and that I take to be one of the important elements of the Bill.
      To try to remove those causes and to eliminate the negative aspect of conflict is not enough. We must provide a framework for healthy and constructive conflict. There must be security and there must be proper protection for the rights of trade unions, trade union membership, the recognition of trade unions and all the rest that is contained within the Bill, without which industrial relations will not flourish in the atmosphere of trust which is so vitally needed.
      I see the Bill as a major attempt to create those necessary conditions in which conflict can become creative and in which industrial democracy can grow. I do not want to go into the question of what we mean by industrial democracy. It will vary from plant to plant and from industry to industry. But it must, if it is worth anything, grow from below and not be imposed from above.
      However, I gather that not all hon. Members see the Bill in quite such a favourable light, and I sympathise with them in their difficulties. Even the CBI could scarce forbear at least half a cheer
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      in November when the consultative document was published. The CBI said:
      "It is true that many of the benefits suggested for employees may in themselves be desirable."
      It is difficult, for example, for gentleman not to treat ladies, particularly pregnant ones, with some respect. Faced with that dilemma, Opposition Members have two courses open to them. The first is to pick and choose and say, as did The Economist, in March, in a memorable headline:
      "Babies yes, pickets no."
      The second choice is to say "Yes", it is a jolly good thing to treat working people better but this is a bad time to do it because we cannot afford it."
      The argument is built up into dire warnings of spiralling inflation, bankruptcy and many people being out of work. However, if we take the £100 million which has been quoted, it must be considered in the context of the total wage and salary bill, which last year was approximately £45,000 million. On a rough calculation, that means that the Bill represents, as near as dammit, one half millionth of the total wage and salary bill, or, in percentage terms, 0·0002 per cent. I agree that that may not be the exact position, but that puts the matter into some kind of perspective.
      Further to the discomfort of Conservative Members is the small matter of the European Economic Community. Almost to a man Conservative Members are content to see our continued membership of that organisation, yet a study by the Trade Union Research Unit of Ruskin College reads:
      "the principle of the guaranteed week is recognised in law in all our partner countries within the EEC."
      There is the exception of Ireland. The study continues:
      "in all the original six member countries the principle applies to all industries and has been in operation for a considerable period of time."
      Conservative Members will remember a debate that took place a few weeks ago on a Community directive on the harmonisation of the legislation of member States relating to what are rather curiously called "mass dismissals". That prompts the thought whether the EEC, like Paris before it, is worth a mass.

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      The real objection to the Bill from Conservative Members is that it contains a package of proposals which, according to the CBI, is
      "one-sided and unfairly biased in favour of the trade unions."
      The Daily Telegraph, in referring to the Bill, used the headline:
      "TUC Militants Win Charter of Privileges'.".
      Well, "you pays your money and you takes your choice", but I prefer to see the Bill as part of a move to enable working people, through their trade unions, to take a more positive and fuller part in the governing of their own rights. That is not to say that trade unions are perfect organisations. There is much that needs to be done in terms of education, for instance, but I prefer to be optimistic and to regard shifts in power and responsibility with hope rather than to adopt the attitude of a conservative defence of privilege.
      I turn to one or two specific aspects of the Bill. I pick out two items for special praise. First, I deal with the section on insolvency. Hon. Members may recall that last year we had the Court Line collapse. That resulted in the loss of 1,200 jobs. I remind the House that Court Line was based in my constituency. That is an intolerable situation for people to face who have given years of service to a company. It is intolerable that they should risk losing wages which they have earned. Surely no hon. Member can cavil at the attempt to put the situation right.
      Secondly, there is the question of the reinforcement and reinstatement provisions as a remedy for unfair dismissal. It is an improvement that I welcome. I have only one criticism to make, and any criticism of the Bill must be in terms of what has been left out in terms of levels. My criticism relates to the position of apprentices. It seems that apprentices, in comparison with adults, need more and not less protection. If the position of apprentices cannot be dealt with in this Bill I hope that it will be dealt with in other legislation.
      I wonder whether apprentices can ever have the kind of security which they need as long as their apprenticeships are vested in a particular employer and not
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      with an independent body, whether it be a training board or something similar.
      Has the Bill been looked at from the point of view of disabled people? I merely ask that question and leave the matter there.
      In summary, I welcome the Bill. see it as a considerable step towards the improvement of the lives of millions of working men and women. I also see it as part of the movement towards a truly democratic way of life. I hope that the Bill will not be regarded as the last word, but, rather, as a first word—in other words, as a sound foundation on which we can build for the future.
      Mr. Deputy Speaker: In calling the hon. Member for Keighley (Mr. Cryer), I ask him to try to finish his remarks by 9 o'clock, to allow time for the winding-up speeches.
      8.56 p.m.
      Mr. Bob Cryer: I always bow to your entreaties, Mr. Deputy Speaker.
      Opposition Members display an air of hypocrisy when talking as though the Bill hands over power to the trade unions. It does nothing of the sort. It hands over power to the people. It gives right to the people, if they choose, to form a trade union. It also enables a trade union to be recognised as of right. The people can take their choice. Workers can say "We shall not become involved in long disputes, such as the Roberts Arundel, Stockport dispute or the Denby dispute at Baildon, or, indeed, the Fine Tubes dispute in Wales". If people want that sort of bitterness, they will oppose the Bill. The legislation will provide for trade unions to be given recognition in statutory form and will end industrial disputes, rather than the reverse. Surely if the legislation avoids disputes such as the ones I have outlined, in one year it will save the fairly paltry sums of money which the Opposition complain are being wasted. Therefore, the measure is very much to be commended.
      I wish to refer to the arguments which have been deployed about the needs and aspirations of small business men. In my constituency I have had complaints from workers who have been dismissed from small businesses—loyal, long-serving employees who are not members of trade

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      unions but who are people who respect their "gaffers". One of the men I have in mind who was sacked is finding great difficulty in finding another job. There is no reason why justice should not apply to small firms as well as to large ones.
      Clause 53 is an important and long overdue provision which is most welcome. It relates to the right of workers to participate in public duties. The Opposition have been a little carping on this score. It has never been difficult for a director to get on to a bench of magistrates. It is time that some of our magisterial benches became more evenly balanced. Many are weighted in favour of the middle and managing classes simply because those people have the opportunity to attend courts whereas ordinary working people do not. A member of my local Labour Party wanted to become the last mayor of Keighley, but was unable to do so. That might be regarded as something of a "Toytown" function, but to the man concerned it was a matter of great pride. He was told that if he applied for that job he need not come back for another. That is the sort of position in which ordinary people find themselves. I am appalled to find the Opposition seeking to bolster up such attitudes.
      Clause 99 on picketing needs clarification. It envisages people having the right to stop and persuade, but makes no attempt to alter the House of Lords decision. Pickets want a clear understanding of the law. They do not want to cut across it. They do not want to find themselves in court in difficult legal circumstances. Among their rights should be the ability to be able to stop people and to be able to persuade them of the value of one's case.
      I should like to conclude by referring to Schedule 13, which amends the Health and Safety at Work Act 1974 and brings in agricultural workers. It was a disgrace that during the period of the minority Labour Government Opposition Members deliberately sought to impede provisions aimed at maintaining the standards of agricultural workers as high as those covered by the Factories Acts. Therefore, I commend the Bill to the House.
      9.0p.m
      Mr. Barney Hayhoe: I should like to remind the Minister that a number of important matters have been raised during the debate and we are hoping to hear him answer them in detail.
      My hon. Friend the Member for Basingstoke (Mr. Mitchell) asked about the problems of small businesses and we understand that the Minister will be commenting upon this.
      My hon. Friend the Member for Warwick and Leamington (Mr. Smith) asked the Minister about the new provisions for the registration of employment agencies which were announced by him during a Consolidated Fund Bill debate earlier in the year, but which at that time I thought had followed consultations with the local authority associations. We should be grateful if the Minister would indicate what the views of local authority associations are on this matter. The information that I and my hon. Friends have confirms that those associations arc opposed to this change.
      My right hon. Friend the Member for Lowestoft (Mr. Prior) asked about the specific relationship between the Advisory, Conciliation and Arbitration Service and the Central Arbitration Committee. There have been comments in the Press on the vagueness of this relationship. Perhaps the Minister, with the help of those who drafted the Bill, will be able to clear up this ambiguity, which, to laymen reading the document, exists.
      My hon. Friend the Member for Kidderminster (Mr. Bulmer) asked whether price increases caused by the Bill would be allowable within the terms of the prices legislation. During the debate a number of tributes have been paid to parliamentary draftsmen, and there have been some criticisms from the hon. Member for Birmingham, Perry Barr (Mr. Rooker). With this week's ration of Second Reading debates, it is a pity that parliamentary draftsmen have been so active. The Opposition would have been much happier if parliamentary draftsmen had taken longer over the drafting of Bills and perhaps had a well-earned holiday, as has been suggested. The country needs less legislation and not more legislation.

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      Small businesses are being put into considerable difficulty by the number of measures being passed by this House which impose upon them, as the hon. Member for Rochdale (Mr. Smith) indicated, a heavy burden in order to ensure that they remain within the law.
      This is a curious Bill both for its contents and for its title. Superficially it might appear reasonable and sensible for the Government, at a time when unemployment is rising so rapidly, to come forward with a Bill to protect employment. However, we know that that superficial impression is totally misleading because the main provision of this legislation which affects employment is not yet in the Bill. It is an amendment, which we understand the Government will table, as a result of the announcement made by the Chancellor of the Exchequer in his Budget speech, about the temporary employment subsidy, which, quite clearly, would have a direct effect upon limiting and reducing—albeit in the development areas and in a restrictive sense—unemployment that would otherwise be created.
      However, the original Bill had little in it at all which could have been said directly to affect employment, except perhaps adversely, for the general emphasis and thrust of the legislation will, if anything, help to create additional unemployment because of the inflationary pressures which the Bill has within it.
      There have been many comments about the Minister of State's estimate of the Bill's total cost as £100 million or £120 million. The hon. Member for Luton, East (Mr. Clemitson) calculated that this might amount to¼per cent. of the total wage bill. But that is not the whole story, in the light of Clause 88 and Schedule 10. It depends which authority one consults. Eric Wigham says that he thinks that the fears about this provision are somewhat overplayed. But the Secretary of State's pet authority, whom he quoted again and again in Committee and whom he has commended in the House, Mr. John Elliot, says that this is potentially the most inflationary of the Bill's provisions. If the most inflationary provision is excluded, at least we beg leave to raise a great question mark over the calculation that we have been given.
      I said that both the contents and the title of the Bill were curious. There seems
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      to be general agreement that the Bill is grotesquely misnamed. My right hon. Friend the Member for Lowestoft suggested that it should be the "Trade Union Benefit (No. 2) Bill". The hon. Member for Birmingham, Perry Barr suggested the "Industrial Relations (No. 2) Bill". My hon. Friend the Member for Cleveland (Mr Brittan) suggested the "Employment Destruction Bill". I begin to suspect that they have been reading Bernard Levin on Clay Cross, and his remarkable series of examples of possible legislation.
      My suggestion is that the Bill should be renamed the "Socialist Con-Trick Consolidation Bill". Such a description is not all that far from reality. I said that the Bill's contents were curious—an odd ragbag of TUC demands and desires over recent years. Pat Lowry, the Industrial Relations Director of British Leyland, whom I can remember the Prime Minister quoting as a considerable authority on these matters, during the 1970 General Election said that the consultative document
      "…reads more like a series of aspirational resolutions passed at a TUC annual conference than proposals which are to become laws of the land."
      I would not dissent from that description.
      Mr. Rooker: Does the hon. Gentleman not draw the obvious conclusion, that if, over the last few years, British Leyland had done all the things which are in the Bill, it would not have reached its present impasse?
      Mr. Hayhoe: I draw the obvious conclusion that the hon. Member knows nothing of the work that Pat Lowry has been doing in British Leyland, or he would not make such a stupid remark.
      Mr. Rooker: I have worked there.
      Mr. Hayhoe: As we say in our amendment, some parts of the Bill reflect good industrial practice but others place on commerce and industry unfair and uneven burdens which we believe should fall upon the State to be met through taxation.
      There seems to have been widespread agreement about the need for proper provision for maternity benefit, which is the norm in most EEC countries. It is questionable whether the right way to do this is to place the burden just upon the firm

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      which employs the women concerned and not upon the men concerned. If it is to be placed upon industry, why not place the burden upon industry overall and pay the benefit to those concerned through the national insurance scheme?
      This proposed provision could lead to difficulties in employment prospects for people who could qualify under these provisions. The net result of the legislation so framed may be to harm the employment prospects of some women rather than help them.
      As my hon. Friend the Member for Basingstoke said, some of the Bill's provisions merely rebuild what was destroyed less than a year ago. The disclosure provisions are taken direct from the Industrial Relations Act; I am not sure that the words are not identical.
      The National Industrial Relations Court is back, but now, as my right hon. Friend said, the Secretary of State, who, as we all know, is so good with words, has renamed it the "Employment Appeal Tribunal". How pleased the right hon. Gentleman must be to have thought up such a master stroke of industrial relations. Michael's miracle is to have turned "NIRC" into "EAT".
      But back to the curious contents of the Bill. There are 56 clauses about the rights of employees. Not one of them deals with the rights of the employee who is adversely affected by the arbitrary, unfair or unreasonable action of trade union. Yet in our earlier debates the Secretary of State indicated that he was contemplating the possibility of putting some provision into this Bill to cover this matter. The excuses he began to produce when we were considering the Trade Union and Labour Relations (Amendment) Act on Report were very thin compared with the clear impression he had given before. It is not too late for us to try, if the Trade Union and Labour Relations (Amendment) Bill is carried, to do something in the Bill to take up this point.
      I suppose if it were possible for someone to give a blank cheque and turn a blind eye at the same moment that is just what the Government are doing as regards the trade unions in the Bill as at present drawn. I suppose there is more to the Bill. We would expect from the Secretary of State that there would be a few
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      nasty little pieces of party spite plunged into it. There is the proposal to change the Health and Safety at Work Act to ensure that only those appointed by trades unions can serve as safety representatives. That is a mean and nasty little provision. I am sorry that the Under-Secretary felt it necessary to attempt to defend it recently at Question Time. If the Bill goes into Committee, we shall attempt to get that provision removed from it.
      I underline my right hon. Friend's support for the Advisory, Conciliation and Arbitration Service. However, there is a real danger that the very fragile indedendence of ACAS could be broken by the Bill. My right hon. Friend referred to the doubts over the membership of the council—three trade unionists, three employers and three academics. If the council is to have on it very eminent men from these spheres, it obviously cannot meet often. If it is to carry out its proper task, particularly as ACAS is given more responsibilities, I wonder whether a system of deputies who are able to meet fairly regularly and deal with questions and then refer matters to the main members of the council might not be the best way of ensuring the independence of the body. The independence is of absolutely crucial significance, as I am sure the Minister will agree.
      What about the staff? As I understand it, they are still civil servants. Does not this mean that they perhaps have a special relationship with their colleagues in the Department from which they come? Is there absolute impartiality about the supply of information? Is the information which they give to Ministers or civil servants in the Department precisely what they would give to other responsible people—say, Members of this House—who have an interest in the matter? These questions of independence and impartiality are important.
      We also criticise Clause 1(2) in singling out collective bargaining alone as being the way in which ACAS will go about its work. I prefer the description given by Jim Mortimer in a speech in Glasgow in January when he spoke of the main functions of ACAS as being
      "advisory and information services to industry for the improvement of collective bargaining, conciliation in industrial disputes, and the provision of arbitration services".

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      That widens it out helpfully, and I hope that amendments to this clause will he accepted.
      As the clause stands, by the time we have passed it ACAS will have to be campaigning against the rest of the Bill. If the Government are to try to preserve collective bargaining above all else, big chunks of the rest of the Bill will have to be removed from the area of collective bargaining items which have traditionally been matters for voluntary agreement in industry. Therefore, it is important to agree with the whole approach of Jim Mortimer, the Chairman of ACAS, when he said that he was seeking to use the
      "weapon of persuasion, not of statutory sanction".
      Yet this Bill is absolutely thick with statutory sanctions. In effect, it imposes the law in all sorts of areas where the law, at least for a period, since the repeal of the Industrial Relations Act, has not been operative. The hon. Member for Birmingham, Perry Barr made this point.
      We see in Clause 65 an attempt by means of the law to enforce specific performance of a contract of employment. I understand, although I am no lawyer, that this is the first time that this dangerous extension of law has been attempted. There is the whole question of recognition procedures, and these are one-sided in favour of the unions. I suppose, as the hon. Member for Motherwell and Wishaw (Dr. Bray) indicated, that one could describe awards by the ACAS as a statutory determination of wage levels.
      The law, therefore, is involved in many ways where it was not involved before. We are seeing a legal framework recruited by this Bill, rebuilding albeit in a different form what was abolished less than a year ago. The court is now to be called an appeal tribunal. This time the framework is trade union designed and trade union biased, but it is a legal framework nevertheless and it is one that could be amended.
      I quote again from John Elliott's perceptive view when he said in The Financial Times on 11th April:
      "The Bill provides a ready made basis on which a future Conservative or any other Government could build restrictions to correct the shift in the industrial power balance which employers expect the Bill to cause."
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      Some hon. Members opposite understand how the process is going, and one follows with interest the way in which Ministers are swallowing their words. Some will remember the way in which the Secretary of State ended his speech on the Second Reading of the Trade Union and Labour Relations Bill on 7th May last year when he produced an eloquent plea for replacing, as he called it in one of the more polite phrases he used, legal prescription by peaceful persuasion. The right hon. Gentleman has eaten those words, for now we are back to legal prescription in this Bill. On item after item, the law is invoked.
      I turn for a moment to Clause 99 and the question of picketing. The Minister of State said that the clause was purely declaratory and did not change the House of Lords' judgment in the Broome case. Why have it then, if it leaves things precisely as they are? Parliamentary draftsmen do not usually waste their time drafting clauses just for the sake of it.
      I am filled with suspicion about why Clause 99 is in the Bill. I suspect that it is there because some hon. Members opposite below the Gangway hope that they can change it from being merely declaratory to being a provision which will change the law, and change it in a direction to which the vast majority of people would strongly object, the direction of giving additional powers to pickets to stop transport on the public highway. If that is the Government's intention, we shall oppose it root and branch in every way open to us, and I hope that at least some Government back benchers will join us in that opposition. The inclusion of Clause 99 inevitably raises substantial doubts.
      As for the protection of employment, how many extra jobs will the Bill provide? Apparently, there will be 700 in the public service, but who knows how many jobs it may end? Will it increase flexibility in manning, will it do anything to increase mobility, will it improve training and retraining in industry? —hardly a thing. Will the Bill improve productivity, reduce unit costs in industry, or reduce the number of strikes or their damaging effect? If it does, that will be fine, but I see little in the Bill which is likely to do much on any of those fronts.

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      There is some possibility that in certain areas the Bill can have a helpful effect— we refer to this in the Opposition amendment—but it is only too likely to harm small businesses. What we have heard today makes clear that the Bill can impose a heavy burden upon small businesses, a burden which they are least able to carry at present when they are trying to digest so many other unpalatable dishes.
      The monumental irrelevance of much of the Bill to the real difficulties confronting the nation is plain for all to see. Some parts of it make sense, and these will be widely supported, but generally the Bill does nothing to help solve our basic and desperate problems.
      In my judgment, the Secretary of State ought to withdraw the Bill, or at least great chunks of it, and then accept the Goodman and other Lords amendments to the Trade Union and Labour Relations (Amendment) Bill which will soon be coming back to the House. How can the Government and their back-bench supporters oppose the Goodman amendment after the NUJ conference decisions last week? It is esential that those amendments be supported by the House.
      If the Government would do something to back the moderates in the trade unions, that would be sensible. There is a lesson here in the affairs of the NUJ. When the more militant and less responsible people had turned up for the conference, it made one decision, but when the NUJ had a postal ballot to replace one of the senior officials of the union, Mr. Blott, there was an entirely different result. Does that not underline the advantage of postal ballots and of trying to get as big a turnout as possible in union elections?
      As true democrats, we want a high turnout at all elections. Is there not something to be said—and would it not have a more helpful effect on industrial relations than a great deal of what is in this long Bill—for the Government facilitating postal ballots? They might do it perhaps by providing free postage, since it is an expensive business to hold a postal ballot with today's high cost of postage. Why not also have a statutory minimum percentage of the electorate being compelled to vote in order that the election shall be valid?
      Mr. Corbett: And the shareholders.
      Mr. Hayhoe: The shareholders are not disrupting the production of British Leyland. Militant shareholders did not cause disruption at the docks. That was the responsibility of trade union leaders, albeit an unofficial leadership. I am seeking to provide support for the moderates in these circumstances, and we are having an interesting reaction to that suggestion from below the Gangway on the Government side.
      The Secretary of State and his junior Ministers are practically the only people left who live in the dream world of believing that the social contract is still working. The Government have more than kept their side of the bargain, but many of the unions have welshed on theirs. We know it, the Chancellor of the Exchequer knows it and the general public know it. Even the Secretary of State for Education and Science knows it, but the Secretary of State for Employment and his team do not.
      Mr. Prior: They choose not to know it.
      Mr. Hayhoe: The Government, led by the nose by the trade union leaders, and the Secretary of State are by this Bill giving weapons to the strong and stripping the defences of the weak. The combination of this legislation and that on trade unions and industrial relations does just that. We need much more of the approach outlined in the debate by two hon. Members, by my hon. Friend the Member for St. Marylebone (Mr. Baker), who made a carefully considered speech on how improvements could be made, and by the hon. Member for Hemel Hempstead (Mr. Corbett)—I hope that I do not cause him difficulties in saying this, but on his whole aproach to this question and his reference to the Industrial Society and to St. George's House, Windsor, and the ideas emanating from these non-political bodies, something of this sort is necessary if we are to solve our problems.
      We certainly need more trust in the work place. We need better consultation, more shared information, deeper involvement and genuine participation. We need much more rational ways of resolving industrial disputes. We also need better training and retraining in industry, and we need less resistance to change. Only

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      if we can begin to remove fear, and certainly the parts of this Bill I support do this, shall we make any progress. In so far as the Bill helps to reinforce good industrial practice it will be supported in all parts of the House. Too much of it, however, fails to pass this test. In the main it is a bonanza for the trade unions. There is too much bias in it, and that is why we shall tonight divide the House in support of the amendment.
      9.29 p.m.
      The Under-Secretary of State for Employment (Mr. Harold Walker): Until I heard the speech by the hon. Member for Brentford and Isleworth (Mr. Hayhoe) I thought that the House had had a good debate. We have had inflicted upon us by the hon. Gentleman a pretty pathetic polemic, which wound up in a manner which was characteristic of the whole speech. He referred to the need for more training and retraining—and that comes a little hit rich from a member of the party which emasculated the Industrial Training Act 1964.
      There have been good, thoughtful speeches from all parts of the House. Some were marred by being delivered in a spirit of rancour, and there were some intemperate, exaggerated remarks. I see that the hon. Member for Carlton (Mr. Holland) has a smile 3n his face. No doubt he is recalling his reference to industrial totalitarianism. The right hon. Member for Lowestoft (Mr. Prior) inflicted upon the House such remarks as "ill thought out" and "ill digested".
      The hon. Member for Kidderminster (Mr. Bulmer) made a powerful plea for the Government—as he put it—to stop interfering with the disciplines of market forces. Market forces are not the prerogative of one side of industry. Is the hon. Member suggesting that the miners and the electricity supply workers and others in key industrial positions should exercise the full power of their market force? He should address himself to the consequences of their doing that.
      Mr. Bulmer: There is a difference between a body that can exercise a monopoly and a body that cannot.
      Mr. Walker: If hon. Members ask me to reply to their speeches and ask me subsequently to give way so that they can
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      make another point while I am speaking, I shall not make much progress in answering the debate. There have been a great many points of detail and I should like to answer as many as time permits.
      I welcome hon. Members' support for ACAS. The right hon. Member for Lowestoft and the hon. Member for Brentford and Isleworth said that there were parts of the Bill that they welcomed, but I must say that one had to sort through their remarks very carefully to find what those were, with the exception of the ACAS. I welcome their support, bearing in mind that it was the Conservative Party which, in 1970, withdrew conciliation facilities from industry.
      Criticism has tended to concentrate on alleged bias and the imbalance between employer and worker, the burden of costs, the alleged failure to help the lower paid, and the problems for small business men. I want to answer that criticism in due course, but first I should like to answer some specific questions.
      The hon. Member for Brentford and Isleworth mentioned the temporary employment subsidy. This proposal arises from Section 5 of the Employment and Training Act 1973. It does what many of us had assumed that section to do—gives power for the Secretary of State to embark on measures necessary to maintain and extend employment opportunities.
      The right hon. Member for Lowestoft stressed the great importance of Community Industry. We share his view of the importance of that scheme and that is why we are taking steps to extend it.
      The hon. Member for Warwick and Leamington (Mr. Smith) made an important observation. Unfortunately, he has not been present since making it at the outset of our proceedings. However, his question was important, and that is why I shall answer it. He asked why we had decided to centralise the licensing and enforcement arrangements for the private employment agencies.
      The Employment Agencies Act 1973 provided that local authorities should be the licensing and enforcement bodies. In the debate on the Consolidated Fund Bill on 23rd January I said that the Government had decided that this function should not be undertaken by the Government. I am therefore surprised that Opposition

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      Members have expressed surprise about this.
      Mr. Hayhoe: I knew that the Minister had said that. I thought that it followed that there would be consultations with the local authorities. The issue was whether those consultations had taken place
      Mr. Walker: I made a mistake in giving way. The hon. Gentleman anticipates the point that I am about to make. If he will be patient and restrained, uncharacteristically, he will see that I am coming to precisely that.
      We announced as long ago as 23rd January the Government's intention to take over the licensing and enforcement function for private employment agencies, and I spelt out to the House in great detail why we had done so.
      Mr. Hayhoe indicated dissent.
      Mr. Walker: The hon. Member has not been here on all the occasions that we have debated these matters when others have expressed surprise. When the Employment Agencies Act was before the House in 1973, the Labour Party took the view that the Government should be the licensing and enforcement authority. I am meeting the representatives of local authorities on Friday at their request to discuss the matter with them. I offered them a meeting before the date of the Second Reading was fixed but for their own good reasons and because of their commitments they chose to defer it until Friday.
      I turn to the point raised by many hon. Members but specifically by my hon. Friend the Member for Luton, West (Mr. Sedgemore) and the hon. Member for Aberdeenshire, East (Mr. Henderson), namely, the position of seasonal workers, the application of the redundancy payments provisions and the prior notice provisions. I make no criticism of them, but if they look at the provisions of Clause 106(7) they will find that to be eligible for the necessary prior notice a worker must be in continuous employment for a period of 12 weeks or more, and must have agreed at the outset of his employment that that would be the duration of the employment.
      The hon. Member for Aberdeenshire, East also asked how districts would be
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      defined for the purpose of the extended provisions in relation to terms and conditions of employment. This would be entirely a matter for the Central Arbitration Committee, with the advice and information put before it in any particular case.
      I congratulate my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) on having done his homework extremely thoroughly and gone through the Bill with a particularly fine-tooth comb. He referred to the exclusion of the over 65s from itemised statements of pay in Clause 106(8). He is right. We shall put that right. Secondly, he referred to Schedule 14, paragraph 11, dealing with the amendment of the Trade Union and Labour Relations Act. Here again, it is as he said—a piece of faulty drafting. We shall put that right. I do not know whether there is such a creature as the parliamentary proof reader, but no doubt my hon. Friend would qualify for that office.
      My hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen) will be pleased to know that the redundancy payments fund, far from being in debt, is well in credit, and on 14th February 1975, St. Valentine's Day, was £17,500,000 in the black. I am not sure whether it was my hon. Friend who referred to male chauvinism in Clause 45—
      Mr. Craigen: Those are your words.
      Mr. Walker: My hon. Friend reminds me that I paraphrased his point. I am advised by lawyers that in Acts of Parliament "male" always embraces "female". The use of the word "her" in this case would presuppose that a woman always replaced a woman. That would have tended to build into the Bill an element of sexual discrimination which I know my hon. Friend does not want.
      Several hon. Members raised questions about the amendments we proposed to make, through the Bill, to the Health and Safety at Work etc. Act concerning workers' safety representatives. We have gone over this ground thoroughly on more than one occasion. I hope that hon. Members will not think me discourteous if I refer only briefly to the considerations lying behind the change. Until we introduced the Health and Safety at Work etc. Bill, Tory Members had not expressed

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      any sympathy or support for the concept of workers' safety representatives. There was no provision in the Industrial Relations Act for such representatives. It was left to this Government to introduce that concept. What the Tories inserted in the Health and Safety at Work etc. Act was an open invitation to every breakaway union to seek roundabout spurious recognition reluctantly wrung from employers. This will have most serious consequences for industrial relations.
      I say, as I said then, that there is nothing in this Bill or in the Health and Safety at Work Act to prevent an employer with an unorganised work force from entering into voluntary arrangements with them for the appointment of safety representatives and joint safety committees. I hope that the Health and Safety Commission will have regard to the Government's policy and intentions in this matter, and will not allow the provisions of the Health and Safety at Work Act to inhibit it in making the progress which we all hope that it will speedily make in bringing forward the proposed regulations.
      I turn to the question of the Advisory, Conciliation and Arbitration Service and the Central Arbitration Committee. The right hon. Member for Lowestoft asked me about the relationship between them. There may well be detailed points which we can usefully discuss in Committee, but in general we intend the ACAS to be independent of the Government and the Central Arbitration Committee to be independent of both, just as the Industrial Arbitration Board has always been independent of Government and of industry. The CAC will be under the wing of ACAS for housekeeping purposes, but this will be a similar relationship to that which previously existed between the IAB and the Department. It will not affect the CAC's independence. The Secretary of State will appoint the Chairman of the CAC after consultation with ACAS.
      The hon. and learned Member for Southport (Mr. Percival) asked whether there is a right of appeal from the CAC. The Bill does not provide such a right, because the decisions of the CAC are arbitral rather than judicial. It follows earlier precedents. There is no right to appeal at present under the Terms and Conditions of Employment Act 1959 from
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      the decisions of the Industrial Arbitration Board. Nor was there any such right of appeal from decisions of the IAB under the Industrial Relations Act, where the JAB had functions, in the last resort, under the recognition and disclosure provisions.
      I turn to the point raised more than once, and specifically by the right hon. Member for Lowestoft, about the Employment Appeal Tribunal. The proposals for the Employment Appeal Tribunal have been compared with the provisions relating to the National Industrial Relations Court. This comparison ignores a fundamental difference between the two bodies. The appeal tribunal will hear only appeals against decisions of industrial tribunals and of the certification officer. It will not have power to issue injunctions. It will not have an original jurisdiction. It was this function of the NIRC—not its appellate jurisdiction—which brought it into conflict with the unions and created problems. This distinction is more important than the similarities detected by right hon. Gentlemen opposite.
      The right hon. Member for Lowestoft, as did several other Members, complained of the bias in favour of unions on recognition issues and, of course, in doing so they were reflecting the views already put to us by the CBI. Employers will have as much right as the unions to seek ACAS assistance under the service's conciliation and advisory powers.
      As regards the recognition clauses themselves, the emphasis in the Bill is very much on conciliation and on negotiation between the parties, with CAC arbitration as a last resort should ACAS efforts to assist a settlement by conciliation remain unsuccessful. At each stage of the new procedures, the employer will have full opportunities to put his side of the case.
      It is appreciated that recognition issues may arise from inter-union disputes. Again, the employer has recourse to ACAS conciliation and advisory machinery. Also, TUC affiliated unions are bound by the requirements of the TUC disputes principles and procedures, which regulate relations between unions and provide for adjudication by a TUC disputes committee if unions are unable to agree which union or unions should be recognised.
      Mr. Brittan rose —
      Mr. Walker: The hon. Gentleman will forgive me if I do not give way. I have much ground to cover.
      Mr. Brittan rose —
      Hon. Members: Give way.
      Mr. Walker: I have been asked to reply to many points and I intend to do my best to reply to them.
      It is not strictly true that as regards ACAS recommendations, all obligations are necessarily on the employers' side. Clause 12 provides that a recommendation for recognition may be subject to conditions with which the union has to comply. A conditional recommendation would become operative only after the service had satisfied itself that the conditions had been complied with.
      Another provision, in Clause 13, enables an employer to apply unilaterally for a recommendation to be varied or revoked if circumstances have changed sufficiently to justify reconsideration of the recommendation.
      It is true that there is ultimately no legal sanction against a union pursuing a claim by means of industrial action in spite of an ACAS or a CAC decision. However, experience shows that such sanctions do not work, and that they simply damage industrial relations. Employers should know this as well as anyone. There is no possibility under the new legislation of yet another ConMech situation arising.
      I turn now to the amendment tabled by the Liberal Party. The Liberals singled out for specific criticism the alleged failure to do anything to
      "protect home-workers, out-workers or the lower-paid by way of a statutory minimum wage".
      The hon. Member for Rochdale (Mr. Smith) says that these groups should be and would be better protected by a "statutory minimum wage". It is the Government's view that voluntary collective bargaining is normally the most effective means of ensuring a decent wage for working people. The TUC guidelines to negotiators recognise the problem of low pay and have established the target of a £30 minimum wage. Of course, this is a target, and in some circumstances it may not be possible to achieve it in one
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      step. But substantial progress has none the less been made in the current pay round towards the target.
      Mr. Cyril Smith rose —
      Mr. Walker: Hon. Gentlemen expect me to reply to the points they have raised, and I shall try to do so.
      We have had legislation to protect lower-paid workers by statutory minimum rates since 1909. The wages councils grew out of it. More than 3 million workers—about 1 in 8 of all workers—are within scope of the wages councils and are covered by statutory minimum rates, yet they still tend to be the low paid. More than 60 years of statutory minima have done little to lift most of them even in the direction of the ranks of the better paid. All too often the "statutory minimum" has become "the rate for the job".
      Mr. Cyril Smith: Does the Minister agree that the point of view he is now expressing, whilst it may be the point of view of the TUC, is not the point of view of the Transport and General Workers' Union?
      Mr. Walker: I am here to present the Government's policy and that is what I am doing.
      There is widespread and growing conviction that the wages council system has not succeeded in its twin objectives of protecting the lower paid and of fostering voluntary collective bargaining. This Bill provides a firm and positive response to those criticisms. First, there is provision to enable a wages council to be transformed into a statutory joint industrial council giving the parties to its proceedings more power, more self-control and a wider scope for bargaining, thus hastening progress towards voluntary collective bargaining.
      Wages councils will be given power to backdate their orders to the settlement date—something which they cannot do at present and which has been rightly the source of much criticism. We are taking power to require employers within scope of wages councils to provide information to the Secretary of State—a power which, surprisingly, is lacking at present. Among other things, this will enable the wages inspectors to operate more effectively. Perhaps the most useful new proposal for low-paid workers is the extension of the

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      provisions embodied in Section 8 of the Terms and Conditions of Employment Act, which has been readily criticised by Opposition Members during the debate.
      The hon. Member for Brentford and Isleworth who wound up for the Opposition, made great play of John Elliott's article in The Financial Times. I thought at the time that if it had not been for John Elliott he would have been short of a speech, He referred to Eric Wigham's article in The Times, which I commend to hon. Members if they want an assessment of the likely costs.
      Homeworkers and outworkers present a particular and perhaps neglected problem, but, as I told my hon. Friend the Member for Birmingham, Perry Barr on 18th March, we have been giving some thought to this. The CIR has made not only some critical remarks but useful comments about what might be done.
      Of course, it is not true that the Bill does nothing for homeworkers. We are taking a positive step to deal with the problem, a small step but a very important one.
      We are amending the definition of "worker" in the Wages Councils Act so that it clearly covers homeworkers. This will enable wages councils to provide much more effectively the protection homeworkers need. It will mean, for example, that even if it is decided that the workers in a particular wages council industry no longer need to have their earnings protected by statute, and the wages council is abolished once the Bill is passed we shall be able to keep the wages council in operation just for the homeworkers in the industry. We could not do that as the law stands. Furthermore, it will be possible, if it were thought necessary, to set up a wages council for homeworkers generally so that whatever work they do we can secure adequate minimum standards for them by statute.
      In addition, we are considering the possibility of a general inquiry into the circumstances in which homeworkers are employed, and in particular what part the ACAS might play in helping towards a fuller understanding of the industrial relations and other problems involved and of the best means of making progress towards their solution.
      162
      I think that 1 have said sufficient to show how ill-founded is the first leg of the Liberal amendment. I assure the hon. Member for Rochdale—the sole representative of his party present throughout the debate— [Interruption.] I apologise. I did not see the hon. Member for Berwick-upon-Tweed (Mr. Beith). He was overshadowed by the hon. Member for Rochdale. I assure Liberal Members that I shall not ignore the other part of their amendment before I sit down.
      I turn to the specific points raised by the Conservative amendment, taking the last one first, because it is not unrelated to what I have just said about the Liberal amendment. We are told that we have taken no account of the particular problems of small businesses. I doubt whether there is any hon. Member who is unmindful of, or unsympathetic to, the problems of the small business man. [Hon. Members: "Humbug."] Perhaps hon. Members will allow me to make my speech in my own way. One reason why the low paid in the wages councils industries have remained low paid is that they tend to be in small business industries. Secondly, wage rates tend to be affected by the capacity to pay of the smallest and weakest employer. Whole industries can become geared to the lowest common denominator of resources and ability to pay.
      Certainly, we must not be indifferent to the problems of the small business man, but, equally certainly, we cannot allow those problems to be permanent obstacles to the achievement of a better society. Nor can we overlook that the Bill is intended to provide rights and protection for individual employees, and it would clearly be unfair to deprive them of these simply because there were very few in a particular firm.
      Furthermore, employers themselves may well complain, as they do, about different statutory obligations based on arbitrary distinction regarding the size of the firm. Training levy, and the exclusion of small firms, is a case in point.
      When he introduced the last Government's Code of Industrial Relations Practice, the right hon. Member for Carshalton (Mr. Carr), facing the same problem, made it clear that he had received representations from small business men who feared that they would have to bear a

      163
      disproportionate burden. His answer to that was quite clear:
      "On the question of small establishments in particular, while I appreciate their difficulties, I feel that the universal applicability of the code is a fundamental feature of it which must be retained. If we once were to depart from that, much of the influence, much of the pressure and incentive of the code would be weakened. A too-easy gateway of excuse would be opened for people not prepared to enter into it."—[Official Report, 18th October 1971; Vol. 823, c. 3911.]
      Just how heavily will these new obligations bear on employers? My hon. Friend in opening the debate said that if all the provisions had been fully in force last year the cost to employers would have been between £100 million and £120 million—about 10p per week per employee. But many employers already have provisions similar to some in the Bill, or even better, so even the modest extra cost I have quoted will be abated in those cases.
      The House will not have overlooked that the different provisions can be introduced at different times, thus diminishing still further the impact of extra costs. The timing of the introduction will be done with full regard for the cost implications. Of the extra cost, as my hon. Friend pointed out, the biggest single item will be for the guarantee payment. Yet, we are extending to manual workers what has for many years been the automatic right of most white-collar workers.
      What the Conservatives seem to fail to understand when they complain about the Bill lacking a fair balance between management and unions is that throughout their whole existence the unions have been gripped with a smouldering resentment that the whole system has been geared to the interests of employers with the balance very firmly tilted in favour of management. Certainly we are redressing something of the imbalance inherent in the whole industrial system. The inequitable discrimination against manual workers is one small part of the general inequity that has engendered resentment on the part of workers.
      Nothing illustrates so clearly the Conservatives' two-faced approach to industrial relations as this very issue of different standards for managerial staffs as against those for manual workers. Yes, they are agreed that these distinctions must be
      164
      eliminated, or at least diminished, but the time is never right to do so—it will always for them cost too much or tilt the balance of rights too much in favour of workers; just as in 1970 the Conservatives repeatedly proclaimed their belief in voluntary collective bargaining conducted by strong trade unions and then imposed the shackles and restraints of the disastrous Industrial Relations Act; just as they regularly make ritual noises on behalf of the low paid, the disabled, or any other disadvantaged group, but did nothing when they had power to do so; just as in recent years, when it suited their party interests to do so, they supported the need for redundancy payments, for equal pay, for legislation against sex discrimination but did nothing. Action had to come from Labour Governments.
      With unerring political instinct, the Conservatives have recognised the political need to identify with each great social and economic reform of the last decade—at the historical moment that it was about to overtake or bypass them—and with the equally unfailing political characteristics of their party have groped for arguments as to why it should not be done. Perhaps inevitably, therefore, this dichotomy has manifested itself again today.
      The Bill represents the second stage of our reform of industrial relations. The first was to rid industry of the disastrous Industrial Relations Act, to cleanse the statute book of the measure that paved the way to the three-day working week and the fall of a Government. The Bill is aimed at remedying some of the identifiable causes of the disorder that undeniably afflicts our industrial relations system, causes of which strikes are often only the symptoms. It is a Bill which seeks to strengthen and extend the voluntary collective bargaining on which our system must continue to be based. It is a Bill which extends to all workers long-overdue rights which hitherto have been the privilege of all too few. Above all, it is a Bill which will help to dispel the bitterness which lingers in the aftermath of the years from 1970 to 1974, a Bill which removes some of the barriers to better relationships in industry and within society.
      I commend it to the House.
      Question put, That the amendment be made:
      The House divided: Ayes 244, Noes 270.

      Division No. 191.]

      AYES

      [10.0 p.m.

      Adley, Robert

      Gorst, John

      Moore, John (Croydon C)

      Aitken, Jonathan

      Gow, Ian (Eastbourne)

      Morgan, Geraint

      Alison, Michael

      Gower, Sir Raymond (Barry)

      Morgan-Giles, Rear-Admiral

      Amery, Rt Hon Julian

      Gray, Hamish

      Morris, Michael (Northampton S)

      Arnold, Tom

      Griffiths, Eldon

      Morrison, Charles (Devizes)

      Atkins, Rt Hon H. (Spelthorne)

      Grimond, Rt Hon J.

      Morrison, Hon Peter (Chester)

      Awdry, Daniel

      Grist, Ian

      Mudd, David

      Baker, Kenneth

      Grylls, Michael

      Neave, Airey

      Banks, Robert

      Hall, Sir John

      Nelson, Anthony

      Bell, Ronald

      Hall-Davie, A. G. F.

      Neubert, Michael

      Bennett, Dr Reginald (Fareham)

      Hamilton, Michael (Salisbury)

      Newton, Tony

      Benyon, W.

      Hampson, Dr Keith

      Nott, John

      Berry, Hon Anthony

      Hannam, John

      Onslow, Cranley

      Biffen, John

      Harvie Anderson, Rt Hon Miss

      Oppenheim, Mrs Sally

      Biggs-Davison, John

      Hastings, Stephen

      Osborn, John

      Blaker, Peter

      Havers, Sir Michael

      Page, Rt Hon R. Graham (Crosby)

      Body, Richard

      Hawkins, Paul

      Pattle, Geoffrey

      Boscawen, Hon Robert

      Hayhoe, Barney

      Percival, Ian

      Bowden, A. (Brighton, Kemptown)

      Heseltine, Michael

      Peyton, Rt Hon John

      Boyson, Dr Rhodes (Brent)

      Hicks, Robert

      Pink, R. Bonner

      Braine, Sir Bernard

      Higgins, Terence L.

      Prior, Rt Hon James

      Brittan, Leon

      Holland, Philip

      Raison, Timothy

      Brotherton, Michael

      Hordern, Peter

      Rawlinson, Rt Hon Sir Peter

      Brown, Sir Edward (Bath)

      Howe, Rt Hon Sir Geoffrey

      Rees, Peter (Dover & Deal)

      Bryan, Sir Paul

      Howell, David (Guildford)

      Rees-Davies, W. R.

      Buchanan-Smith, Alick

      Howell, Ralph (North Norfolk)

      Renton, Rt Hon Sir D. (Hunts)

      Buck, Antony

      Howells, Geraint (Cardigan)

      Renton, Tim (Mid-Sussex)

      Budgen, Nick

      Hurd, Douglas

      Rhys Williams, Sir Brandon

      Bulmer, Esmond

      Hutchison, Michael Clark

      Ridley, Hon Nicholas

      Burden, F. A.

      Irving, Charles (Cheltenham)

      Ridsdale, Jullan

      Carlisle, Mark

      Jenkin, Rt Hon P. (Wanst'd&W'df'd)

      Rifkind, Malcolm

      Carr, Rt Hon Robert

      Jessel, Toby

      Rippon, Rt Hon Geoffrey

      Chalker, Mrs Lynda

      Johnson Smith, G. (E Grinstead)

      Roberta, Michael (Cardiff NW)

      Churchill, W. S.

      Jones, Arthur (Daventry)

      Roberts, Wyn (Conway)

      Clark, Alan (Plymouth, Sutton)

      Jopling, Michael

      Ross, Stephen (Isle of Wight)

      Clark, William (Croydon S)

      Joseph, Rt Hon Sir Keith

      Rossl, Hugh (Hornsey)

      Clarke, Kenneth (Rushcliffe)

      Kaberry, Sir Donald

      Rost, Peter (SE Derbyshire)

      Clegg, Walter

      Kellett-Bowman, Mrs Elaine

      Royle, Sir Anthony

      Cockcroft, John

      Kershaw, Anthony

      Sainsbury, Tim

      Cope, John

      Kimball, Marcus

      St. John-Stevas, Norman

      Cormack, Patrick

      King, Evelyn (South Dorset)

      Scott, Nicholas

      Corrie, John

      King, Tom (Bridgwater)

      Shaw, Giles (Pudsey)

      Costain, A. P.

      Kitson, Sir Timothy

      Shelton, William (Streatham)

      Crouch, David

      Knight, Mrs Jill

      Shepherd, Colin

      Crowder, F. P.

      Knox, David

      Shersby, Michael

      Davies, Rt Hon J. (Knutsford)

      Lamont, Norman

      Silvester, Fred

      Dean, Paul (N Somerset)

      Lane, David

      Sims, Roger

      Douglas-Hamilton, Lord James

      Latham, Michael (Melton)

      Sinclair, Sir George

      Drayson, Burnaby

      Lawrence, Ivan

      Skeet, T. H. H.

      du Cann, Rt Hon Edward

      Lawson, Nigel

      Smith, Cyril (Rochdale)

      Durant, Tony

      Le Merchant, Spencer

      Smith, Dudley (Warwick)

      Dykes, Hugh

      Lewis, Kenneth (Rutland)

      Speed, Keith

      Eden, Rt Hon Sir John

      Lloyd, Ian

      Spence, John

      Edwards, Nicholas (Pembroke)

      Loveridge, John

      Spicer, Jim (W Dorset)

      Emery, Peter

      Luce, Richard

      Spicer, Michael (S Worcester)

      Eyre, Reginald

      McAdden, Sir Stephen

      Sproat, Iain

      Fairbairn, Nicholas

      McCrindle, Robert

      Stainton, Keith

      Fairgrieve, Russell

      Macfarlane, Nell

      Stanbrook, Ivor

      Fell, Anthony

      MacGregor, John

      Stanley, John

      Finsberg, Geoffrey

      Macmillan, Rt Hon M. (Farnham)

      Steel, David (Roxburgh)

      Fisher, Sir Nigel

      McNair-Wilson, M. (Newbury)

      Steen, Anthony (Wavertree)

      Fletcher, Alex (Edinburgh N)

      McNair-Wilson, P. (New Forest)

      Stewart, Ian (Hitchin)

      Fletcher-Cooke, Charles

      Madel, David

      Stokes, John

      Fookes, Miss Janet

      Marshall, Michael (Arundel)

      Stradling Thomas, J.

      Fowler, Norman (Sutton C'f'd)

      Marten, Nell

      Tapsell, Peter

      Fox, Marcus

      Mates, Michael

      Taylor, R. (Croydon NW)

      Fraser, Rt Hon H. (Stafford & St)

      Mather, Carol

      Taylor, Teddy (Cathcart)

      Freud, Clement

      Maude, Angus

      Tebbit, Norman

      Galbraith, Hon T. G. D.

      Mawby, Ray

      Temple-Morris, Peter

      Gardner, Edward (S Fylde)

      Mayhew, Patrick

      Thatcher, Rt Hon Margaret

      Gilmour, Rt Hon Ian (Chesham)

      Meyer, Sir Anthony

      Thomas, Rt Hon P. (Hendon S)

      Gilmour, Sir John (East Fife)

      Mills, Peter

      Thorpe, Rt Hon Jeremy (N Devon)

      Glyn, Dr Alan

      Miscampbell, Norman

      Townsend, Cyril D.

      Godber, Rt Hon Joseph

      Mitchell, David (Basingstoke)

      Trotter, Neville

      Goodhart, Philip

      Moate, Roger

      Tugendhat, Christopher

      Goodhew, Victor

      Monro, Hector

      van Straubenzee, W. R.

      Goodlad, Alastair

      Montgomery, Fergus

      Vaughan, Dr Gerard

      Viggers, Peter

      Wells, John

      Younger, Hon George

      Wakeham, John

      Whitelaw, Rt Hon William

      Walker, Rt Hon P. (Worcester)

      Wiggin, Jerry

      TELLERS FOR THE AYES:

      Walker-Smith, Rt Hon Sir Derek

      Winterton, Nicholas

      Mr. Adam Butler and

      Walters, Dennis

      Wood, Rt Hon Richard

      Mr. Cecil Parkinson.

      Weatherill, Bernard

      Young, Sir G. (Ealing, Acton)

      NOES

      Anderson, Donald

      Ewing, Mrs Winifred (Moray)

      Mackenzie, Gregor

      Archer, Peter

      Fitch, Alan (Wigan)

      Mackintosh, John P.

      Armstrong, Ernest

      Flannery, Martin

      Maclennan, Robert

      Ashley, Jack

      Fletcher, Ted (Darlington)

      McMillan, Tom (Glasgow C)

      Atkins, Ronald (Preston N)

      Ford, Ben

      McNamara, Kevin

      Atkinson, Norman

      Forrester, John

      Madden, Max

      Bagier, Gordon A. T.

      Fowler, Gerald (The Wrekin)

      Mahon, Simon

      Bain, Mrs Margaret

      Fraser, John (Lambeth, N'w'd)

      Marquand, David

      Barnett, Guy (Greenwich)

      Freeson, Reginald

      Marshall, Dr Edmund (Goole)

      Barnett, Rt Hon Joel (Heywood)

      Garrett, John (Norwich S)

      Marshall, Jim (Leicester S)

      Bates, Alf

      Garrett, W. E. (Wallsend)

      Mason, Rt Hon Roy

      Bean, R. E.

      Gilbert, Dr. John

      Maynard, Miss Joan

      Benn, Rt Hon Anthony Wedgwood

      Ginsburg, David

      Meacher, Michael

      Bennett, Andrew (Stockport N)

      Golding, John

      Mellish, Rt Hon Robert

      Bidwell, Sydney

      Gould, Bryan

      Mikardo, Ian

      Bishop, E. S.

      Graham, Ted

      Millan, Bruce

      Blenkinsop, Arthur

      Grant, John (Islington C)

      Miller, Mrs Millie (Ilford N)

      Booth, Albert

      Grocott, Bruce

      Mitchell, R. C. (Soton, Itchen)

      Boothroyd, Miss Betty

      Hamilton, James (Bothwell)

      Molyneaux, James

      Bottomley, Rt Hon Arthur

      Hamilton, W. W. (Central Fife)

      Morris, Alfred (Wythenshawe)

      Boyden, James (Bish Auck)

      Hardy, Peter

      Morris, Charles R. (Openshaw)

      Bradley, Tom

      Harper, Joseph

      Morris, Rt Hon J. (Aberavon)

      Bray, Dr Jeremy

      Harrison, Walter (Wakefield)

      Mulley, Rt Hon Frederick

      Broughton, Sir Alfred

      Hart, Rt Hon Judith

      Murray, Rt Hon Ronald King

      Brown, Robert C. (Newcastle W)

      Hattersley, Rt Hon Roy

      Newens, Stanley

      Buchan, Norman

      Hatton, Frank

      Noble, Mike

      Butler, Mrs Joyce (Wood Green)

      Hayman, Mrs Helene

      Oakes, Gordon

      Callaghan, Jim (Middleton & P)

      Heffer, Eric S.

      Ogden, Eric

      Campbell, Ian

      Henderson, Douglas

      O'Halloran, Michael

      Canavan, Dennis

      Hooley, Frank

      O'Malley, Rt Hon Brian

      Cant, R. B.

      Horam, John

      Orbach, Maurice

      Carmichael, Neil

      Howell, Denis (B'ham, Sm H)

      Orme, Rt Hon Stanley

      Carter-Jones, Lewis

      Hoyle, Doug (Nelson)

      Ovenden, John

      Cartwright, John

      Huckfield, Les

      Owen, Dr David

      Castle, Rt Hon Barbara

      Hughes, Rt Hon C. (Anglesey)

      Palmer, Arthur

      Clemitson, Ivor

      Hughes, Mark (Durham)

      Park, George

      Cocks, Michael (Bristol S)

      Hughes, Robert (Aberdeen N)

      Parry, Robert

      Colquhoun, Mrs Maureen

      Hughes, Roy (Newport)

      Pavitt, Laurie

      Concannon, J. D.

      Hunter, Adam

      Perry, Ernest

      Cook, Robin F. (Edin C)

      Irvine, Rt Hon Sir A. (Edge Hill)

      Phipps, Dr Colin

      Corbett, Robin

      Irving, Rt Hon S. (Dartford)

      Powell, Rt Hon J. Enoch

      Cox, Thomas (Tooting)

      Jackson, Colin (Brighouse)

      Prentice, Rt Hon Reg

      Craigen, J. M. (Maryhill)

      Janner, Greville

      Price, C. (Lewisham W)

      Crawford, Douglas

      Jay, Rt Hon Douglas

      Price, William (Rugby)

      Crawshaw, Richard

      Jeger, Mrs Lena

      Radice, Giles

      Cronin, John

      Jenkins, Rt Hon Roy (Stechford)

      Reid, George

      Cryer, Bob

      John, Brynmor

      Richardson, Miss Jo

      Cunningham, G. (Islington S)

      Johnson, James (Hull West)

      Roberts, Albert (Normanton)

      Cunningham, Dr J. (Whiteh)

      Johnson, Walter (Derby S)

      Roberts, Gwilym (Cannock)

      Davidson, Arthur

      Jones, Alec (Rhondda)

      Robertson, John (Paisley)

      Davies, Bryan (Enfield N)

      Jones, Barry (East Flint)

      Roderick, Caerwyn

      Davies, Denzil (Llanelli)

      Jones, Dan (Burnley)

      Rodgers, George (Chorley)

      Davies, Ifor (Gower)

      Judd, Frank

      Rodgers, William (Stockton)

      Davis, Clinton (Hackney C)

      Kaufman, Gerald

      Rooker, J. W.

      Deakins, Eric

      Kelley, Richard

      Rose, Paul B.

      Dean, Joseph (Leeds West)

      Kerr, Russell

      Ross, Rt Hon W. (Kilmarnock)

      de Freitas, Rt Hon Sir Geoffrey

      Kilroy-Silk, Robert

      Rowlands, Ted

      Delargy, Hugh

      Kinnock, Neil

      Ryman, John

      Dell, Rt Hon Edmund

      Lamble, David

      Sandelson, Neville

      Dempsey, James

      Lamborn, Harry

      Sedgemore, Brian

      Doig, Peter

      Leadbitter, Ted

      Selby, Harry

      Douglas-Mann, Bruce

      Lee, John

      Shaw, Arnold (Ilford South)

      Duffy, A. E. P.

      Lestor, Miss Joan (Eton & Slough)

      Sheldon, Robert (Ashton-u-Lyne)

      Dunnett, Jack

      Lever, Rt Hon Harold

      Shore, Rt Hon Peter

      Dunwoody, Mrs Gwyneth

      Lipton, Marcus

      Silkin, Rt Hon John (Deptford)

      Eadie, Alex

      Litterick, Tom

      Silkin, Rt Hon S. C. (Dulwich)

      Edge, Geoff

      Lomas, Kenneth

      Sillars, James

      Edwards, Robert (Wolv SE)

      Loyden, Eddie

      Silverman, Julius

      Ellis, Tom (Wrexham)

      Luard, Evan

      Skinner, Dennis

      English, Michael

      Lyon, Alexander (York)

      Small, William

      Ennals, David

      Lyons, Edward (Bradford W)

      Smith, John (N Lanarkshire)

      Evans, Fred (Caerphilly)

      MacCormick, Iain

      Spearing, Nigel

      Evans, Ioan (Aberdare)

      McCusker, H.

      Spriggs, Leslie

      Evans, John (Newton)

      McElhone, Frank

      Stallard, A. W.

      Ewing, Harry (Stirling)

      McGuire, Michael (Ince)

      Stewart, Donald (Western Isles)

      168

      169

      Stewart, Rt Hon M. (Fulham)

      Wainwright, Edwin (Dearne V)

      Williams, Alan Lee (Hornch'ch)

      Stoddart, David

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

      Williams, Rt Hon Shirley (Hertford)

      Stott, Roger

      Walker, Harold (Doncaster)

      Williams, W. T. (Warrington)

      Strang, Gavin

      Walker, Terry (Kingswood)

      Wilson, Alexander (Hamilton)

      Strauss, Rt Hon G. R.

      Ward, Michael

      Wilson, Gordon (Dundee E)

      Summerskili, Hon Dr Shirley

      Watkins, David

      Wilson, William (Coventry SE)

      Swain, Thomas

      Watkinson, John

      Wise, Mrs Audrey

      Taylor, Mrs Ann (Bolton W)

      Watt, Hamish

      Woodall, Alec

      Thomas, Jeffrey (Abertillery)

      Weetch, Ken

      Woof, Robert

      Thomas, Mike (Newcastle E)

      Weitzman, David

      Wrigglesworth, Ian

      Thomas, Ron (Bristol NW)

      Welsh, Andrew

      Young, David (Bolton E)

      Thompson, George

      White, Frank R. (Bury)

      Thorne, Stan (Preston South)

      White, James (Pollok)

      Tinn, James

      Whitlock, William

      TELLERS FOR THE NOES

      Tomlinson, John

      Wigley, Dafydd

      Mr. J. D. Dormand and

      Tomney, Frank

      Willey, Rt Hon Frederick

      Mr. John ***

      Varley, Rt Hon Eric G.

      Williams, Alan (Swansea W)

      Question accordingly negatived.
      Main Question put forthwith pursuant to Standing Order No. 39 (Amendment on Second or Third Reading), and agreed to.
      Bill accordingly read a Second time.
      Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills)

      EMPLOYMENT PROTECTION [MONEY]
      Queen's Recommendation having been signified—
      Resolved,
      That, for the purposes of any Act of the present Session to establish machinery for promoting the improvement of industrial relations and to amend the law relating to workers' rights and otherwise to amend the law relating to workers, employers, trade unions and employers' associations, it is expedient to authorize—

      (1) the payment out of moneys provided by Parliament of

      (a) all expenses incurred by the Secretary of State or any other Minister of the
      170
      Crown or any government department in consequence of the provisions of the new Act; and

      (b) any increase attributable to the pro-visions of the new Act in the sums payable out of moneys so provided under any other enactment;

      (2) any increase in the sums to he paid into or out of the National Loans Fund in consequence of any provision of the new Act increasing to £40 million the limit imposed by section 35 of the Redundancy Payments Act 1965 on the aggregate amount outstanding of advances from that fund to the Redundancy Fund;

      (3) the payment into the Consolidated Fund out of the Redundancy Fund of sums equal to the amount of—

      (a) any expenses incurred by the Secretary of State in exercising his functions under the provisions of the new Act in relation to payments to employees or occupational pension schemes on the insolvency of an employer;

      (b) any increase attributable to the pro-visions of the new Act in the sums falling to be paid under section 55(5) of the Redundancy Act 1965;

      (4) the payment into the Consolidated Fund of any sums received by a Minister of the Crown by virtue of the new Act.—[Mr. Harper.]

      AGRICULTURE (BEEF PREMIUMS)
      10.14 p.m.
      The Minister of State for Agriculture, Fisheries and Food (Mr. E. S. Bishop): I beg to move,
      That the Beef Premiums (Protection of Payments) Order 1975, a copy of which was laid before this House on 19th March, be approved.
      The purpose of the order is to supplement existing statutory powers to enable the Intervention Board for Agricultural Produce to ensure that the necessary conditions are observed when beef animals and carcases are certified for premium payments in accordance with Community arrangements.
      As the House will know, my right hon. Friend has always taken the view that a system of direct payments to producers was eminently preferable to permanent intervention as the main means of supporting the beef market. A significant development took place in August last year, when the Council of Ministers adopted our proposal and introduced on a temporary basis a system of headage payments on clean cattle at the time of slaughter. A further important step was taken in November, when the Community agreed that the United Kingdom could supplement the headage payments by paying an additional variable premium when necessary to provide producers with an assured minimum return. This again was a temporary arrangement, but this combination of schemes provided very valuable help to our producers over the months when the beef market everywhere was severely depressed.
      Also following an initiative by the United Kingdom, the Council of Ministers took another important decision last year, in agreeing to review the way in which the Community beef régime should operate from the beginning of the 1975–76 marketing year. There can be no doubt that the experience of working the temporary premium arrangements in this country provided valuable support for my right hon. Friend's case that the new régime should incorporate similar direct payments to beef producers as a permanent feature. As the House will know, such arrangements were accepted
      172
      by the Council of Ministers and now form an integral part of the EEC beef support system. As a result, we and other member States are now paying a headage premium on all qualified cattle going for slaughter and have the option of paying an additional variable premium when necessary—an option we have adopted.
      In essence these arrangements are very similar to the fatstock guarantee system which we in this country operated very successfully for many years until 1973. Indeed, the new arrangements are framed in such a way that we are able to operate virtually the same procedures, and to base the scheme on broadly the same certification standards, as under the Fatstock Guarantee Scheme. It was very fortunate that the administrative machinery of that scheme was still available and able to be adapted at very short notice when the beef premium arrangements were brought in last August.
      Since these premiums are now established as a permanent part of the Community support system, it is essential to provide the Intervention Board, which is responsible for operating them throughout the United Kingdom, with statutory means of control such as we had under the Fat-stock Guarantee Scheme. To an extent these are already provided in existing legislation. The order now before the House provides the remaining controls which the board needs to have in order to ensure the proper protection of the public expenditure on beef premiums.
      Under the order the Intervention Board is given full powers to require the marking of any animal or carcase that is certified for payment of premium, in order to ensure that it may not be resubmitted. It is also a statutory requirement of the order that necessary records should be kept and produced when required. The order also provides the power to obtain evidence of suspected offences. In this connection, the House will note that, while Article 11(1)(b) gives to an authorised officer the right to take possession of records, the order does not itself provide a right of entry on premises for the purpose. This is because adequate rights of entry are considered to exist already by virtue of Article 4 of the Common Agricultural Policy (Agricultural Produce)

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      (Protection of Community Arrangements) (No. 2) Order 1973.
      Mr. J. Enoch Powell: Could the Minister of State explain whether, between August last and March when the order came into force, these safeguards have not been being applied or whether they have been being applied without any legal force?
      Mr. Bishop: I think that I made the point that the rights of entry to which I referred are considered to exist already by virtue of previous legislation. I will deal with the right hon. Gentleman's question later on in the debate if I may.
      In conclusion, I will draw the attention of the House to the main difference between the new premium scheme and the fatstock guarantee arrangements—
      Mr. Russell Kerr: On a point of order, Mr. Deputy Speaker. Would the Minister kindly gabble a little less and take this matter a little more slowly, so that those of us who are concerned about the expenditure of hundreds of millions of pounds can weigh these matters and come to the correct decision?
      Mr. Bishop: I will take note of my hon. Friend's comment. I was anxious that those who wished to take part in this debate in the limited time available should have the opportunity to do so.
      The right hon. Gentleman asked what had been done to protect payments from August last until now. Since 5th August 1974 the provisions of the Beef Premium Scheme have been enforced under the Common Agricultural Policy (Agricultural Produce) (Protection of Community Arrangements) (No. 2) Order 1973, Statutory Instrument 1973/288, and the Theft Act. Previous experience in operating the Fatstock Guarantee Scheme has revealed the need for more specific legislation, such as the power to take possession of any records or to mark ears. The marking provisions of the order add statutory backing to the administrative arrangement that the Intervention Board has been operating since the start of the scheme.
      In conclusion, I would draw the attention of the House to the main difference between the new premium scheme and the fatstock guarantee arrangements,
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      which is in the requirement that a certified animal must be slaughtered within a specified period. It is an essential basis of the Community rules governing the premiums that payment depends on slaughter, but to accommodate our own livestock marketing system the regulations provide a period of grace before slaughter need take place. That period has since August been set at 15 days, but under new Community regulations to come into effect next month we shall have some flexibility which will enable us to extend the period up a maximum of 28 days should circumstances make this necessary. The order makes the necessary provision for such variations in the period.
      10.22 p.m.
      Mr. Robert Hicks: It is often said that life is full of ironies. In reviewing both the contents of the order and the background to its being discussed tonight anybody, whether a producer of beef or a consumer with any practical knowledge of farming, could be forgiven if he reached the conclusion that he could well do without the interference and so-called assistance of politicians.
      We have completed a cycle. The Minister of State went briefly through the history of the past 12 months. My only comment from this side is to express the view that it has indeed been a pitiful saga characterised by a complete indifference to the real problems that have confronted livestock producers, and at the same time prejudicing as a consequence the future supplies of home-produced beef.
      It is true that the order contains the mechanism by which producers of beef can expect some stability in the market over the next 12 months. Sadly, however, the cost to the nation, not only in financial terms, both in the context of loss to the producer and the higher price and also in the context of the loss of confidence that the agricultural community will have in politicians and government in particular, is significant.
      There are a number of specific matters that we on this side wish to raise with the Minister tonight. The first concerns the period for which the provisions outlined in the order are valid and the intended time scale for which the present system of support for producers of beef will operate. The Minister will appreciate

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      that the duration of these two periods will not necessarily be identical. The House was told on an earlier occasion that the present system of support, involving a target price fortified by the combination of headage payments and variable premiums if the market is not at the required level, will last for a period of 12 months. We wish to point out to the Minister that this period is inadequate. After all, it takes some three years from conception to produce a finished beef animal. I find it somewhat ironic for the Government to be restricting this scheme to a period of 12 months at a time when the Government themselves have just published a White Paper entitled "Food from our own Resources" which looks to the future in terms of a five-year period.
      I hope that the Minister will respond to this aspect when he replies, because he should know that if he really wishes the farming industry to respond in a positive manner to his White Paper he must provide the resources to give it the incentive. The Minister has an opportunity tonight—
      Mr. Deputy Speaker (Mr. George Thomas): Order. In order to assist the hon. Gentleman and others who may follow him, may I point out that this is a very narrow order and that the question of the appropriate level of the beef premium is not one of the subjects which they are able to discuss.
      Mr. Hicks:The second request, which I think will receive your support, Mr. Deputy Speaker, in that I shall not be ruled out of order, refers to the publication of the prices inherent in this order. At present this is done on a three-month basis. In the interests of forward planning, some advance guidance covering a longer period would be helpful.
      May I now ask a question on the subject of providing to the farming community detailed information arising from the contents of this order? This is a very complicated scheme. The structure of payments is not readily understood by those who have to deal with them. Indeed, over the past weekend in my own constituency two people on two separate occasions raised this very point with me,
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      and it would be helpful to all concerned in the industry who have to implement this scheme if the Intervention Board could prepare some form of explanatory leaflet to help the farmers and auctioneers.
      Finally, may I ask the Minister to explain in a little more detail how the provisions in this order vary, in a technical sense, from those in the former Fatstock Guarantee Scheme. What changes have there been, and on what justification have they been made? What provision will be made by the Government to inform the industry of these changes?
      We have experienced in this industry a very unsatisfactory past 15 months. We on this side of the House welcome the introduction of a system designed to give a measure of stability to the market. We would point out to the Government, however, that a 12-month period is not really adequate. They should be thinking of a longer period, and I hope that some idea of this will be forthcoming when the Minister replies to the debate.
      10.29 p.m.
      Mr. Mark Hughes: I direct attention first to Article 2, where we have the definition of "premium payment" Will such sums be payable directly by Her Majesty's Government, by the Community, or by some interwoven transfer payments going to and from Brussels like a shuttle in a loom?
      Second, under the provision that 28 days are now to be permitted between certification and slaughter, is any control envisaged over the export of such certificated animals to EEC countries, or otherwise? Are we to have a certificate which allows for payment without any control over the export of the beast in the period between the granting of the certification and the slaughter?
      Third, what proportion of the headage payment envisaged as being controlled by the order is directly attributable to a Vote passed by this House with full autonomy, and what part is attributable to a duty laid upon the House to transfer funds to an authority elsewhere? Similarly, with regard to the variable premium, at what point does the House control the Vote on Account which can be authenticated by the protection of payments which we are concerned with in this order?

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      I find it difficult to follow the history of the past year given by the hon. Member for Bodmin (Mr. Hicks). I do not differ from him in the view that the räle of outside bodies in the ruination of the British beef industry over the past 12 months has not been significant, but this House and the Government have throughout been in the gravest difficulty in finding a way of making an alien organisation and an alien system work in the conditions which prevail in Great Britain and, I think, especially in Northern Ireland, where the moving of store beasts or nearly finished animals across a land border makes many of the provisions of the order approach farce. Is it not possible for farmers in the Irish Republic to move animals on the verge of slaughter across the border and perchance—my hon. Friend will be able to tell us whether this is true—gain a significant pecuniary advantage thereby?
      I am disturbed that the order seems to purport to introduce—if I understand the explanatory memorandum aright—a permanent arrangement, when I am led to believe that such is the organisation of the European Community that a man would be a clot to believe that any arrangement can last for more than 12 months. Is this arrangement for 12 months or three years? How long does it last, and what procedures are available to the House to amend by subsequent orders what is contained herein?
      With the greatest deference to my hon. Friend the Minister, it seems to be an order conceived in transgression, and I fear that it will come to an ill-begotten end.
      10.34 p.m.
      Mr. Geraint Howells: My hon. Friends and I welcome the order. As a practical farmer—here I declare my interest—I see the scheme as necessary to end the uncertainty in agriculture, and in the beef sector in particular. I compliment the Minister and his colleagues on their achievements in Brussels. Indeed, I go further and say that, in my view, nearly all beef producers welcome the new system of guaranteed prices for live fat animals.
      I hope that, when the present experimental year comes to an end, the Minister will be able to persuade his fellow Ministers to adopt the British beef sup-
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      port system instead of their rigid intervention system, which, I believe, is not acceptable to the majority of farmers. To me it proves once again that British membership of the EEC will benefit all concerned and that over a period we can help others in the Community to change the common agricultural policy to a policy that will assist farmers and producers alike.
      The present scheme will bring certain benefits. There will be greater price stability and, in the long term, security of supply for the British housewife. There will be stability and support for beef producers on low marginal and hill land in Britain on whom we rely for our everyday supplies.
      There are at present over 950,000 hill cows in the United Kingdom. They produce one fifth of all calves used for beef production at an estimated value of about £120 million in finished cattle. The sole output from these farms is weaned suckled calves for finishing on more favourable farms. With the 1974 crisis in the livestock sector, the collapse in confidence amongst farmers, a poor hay harvest, and a shortage of fodder and capital, the price of suckled calves dropped to a very low ebb and margins fell by nearly 40 per cent. compared with the autumn of 1973.
      The order should go a long way to helping the milk and dairy sector. As always, it has its financial troubles. We have vivid memories or calves being sold in 1974 for 8p and 10p each. It must not happen again, and I hope that the Milk Marketing Board, as a producers' organisation, will urge on the Government the need to bring stability and confidence back to this sector of the industry.
      Mr. Ted Leadbitter:I understand the hon. Member to be saying that he welcomes the result of the negotiations from the point of view of the people he represents. Some of us are far more concerned about the parliamentary situation. Is he aware that we are talking about an order which was made on 11th March, placed before Parliament on 19th March and put into operation on 20th March? There is an explanatory note dated 10th April, but people who appeared before the Joint Committee on Statutory Instruments have not yet had a chance to correct the transcript of their

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      evidence. What is the point of Parliament dealing with these instruments in such circumstances?
      Mr. Deputy Speaker: Perhaps the hon. Member for Cardigan (Mr. Howells) will deal with the order and leave the other problem. Our debate concerns this specific order.
      Mr. Leadbitter: On a point of order, Mr. Deputy Speaker. The point I raised concerned this particular instrument. I was referring to this instrument and to no other.
      Mr. Deputy Speaker: I hope that the hon. Member for Hartlepool (Mr. Lead-bitter) does not feel offended at anything I said.
      Mr. Leadbitter: Certainly not, Mr. Deputy Speaker.
      Mr. Deputy Speaker: I am merely trying to keep the hon. Member for Cardigan on the straight and narrow path.
      Mr. Howells: I hope that I have not said anything to offend the hon. Member for Hartlepool (Mr. Leadbitter) either, Mr. Deputy Speaker. I must stress, however, that I am in favour of what the Minister has achieved in Brussels for the farming community.
      The dairy sector of the industry works long and unsocial hours and it deserves an adequate reward. I hope that producers' hard toil and expensively borrowed capital will earn them a satisfactory return compared to other industries.
      Does the Minister honestly believe that the present scheme will be allowed to operate once the transitional period is over? If not, will he give an assurance that British farmers in the livestock sector will not be allowed to be at the mercy of a free market, with no guaranteed price system operating, such as we experienced last year?
      If the Minister can give us that assurance tonight, farmers will expand and increase production from the land of Britain by producing the beef that is required by the consumers of this country, who regard our home-produced beef as the best in the world. The reason for my asking the Minister for an assurance tonight is that I read in the Farmers Weekly of 29th April that Mr.
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      Lardinois had put a limit on mixed beef aid. The report said:
      "The Common Market's present mixture of beef support systems will not be allowed to run beyond the present experimental year, says Mr. Petrus Lardinois.
      "He said: 'The differences in policy—the British variable premium scheme, the French cow subsidy, the Italian calf subsidy—represent a threat to the market. They were a calculated risk'.
      'Perhaps', he added, 'we are growing towards a support policy that is common and has something of all the systems in it.
      This experience in Britain can teach us something. We can learn from it'."
      I hope that the Minister will agree with those sentiments expressed by Mr. Lardinois, and I look forward to his reply.
      10.42 p.m.
      Mr. Graham Page: I want to call the attention of the House to three defects in the order, but in doing so I am not in any way attacking the merits of the order. Indeed, just the opposite! I want to ensure that the order will be effective and not be an invitation to litigation. I think that in at least these three respects it is ambiguous.
      I want first to refer to the interpretation article, which defines "premium payment". You said, Mr. Deputy Speaker, that we were not concerned with the level of the payment in any way. A premium payment is defined as being a payment by virtue of Community arrangements. Those are not identified anywhere in the order. A reader of the order would not know just by reading the order what the Community arrangements might be. Indeed, that was put to the Ministry's witnesses who came before the Statutory Instruments Committee and they admitted at once that the Community arrangements altered from day to day and had not reached any formal document in any way that could be identified.
      When did the Community arrangements come into effect? Did they come into effect, and have payments been made, prior to the order being made? If so, under what procedure were these premium payments received by the owners of the animals? In short, was the order being operated before it was made, and, if so, what is the purpose of making it now?
      The second defect appears in Article 4. It says:
      "Where an animal has been approved for certification … and has thereafter on the same

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      day been sold by auction.. the animal shall immediately be marked as prescribed in Schedule 1 to this order."
      Schedule 1 has two paragraphs. The first is perfectly straight-forward. It describes the marking as being by a circular punch 12 mm in diameter, and so on. However, paragraph 2 says:
      "In addition, where the Board so require, a tattooed symbol unique to the animal being marked…".
      The words to which I call attention are "the Board so require". The witnesses who came before the Statutory Instruments Committee were asked how the Intervention Board for Agricultural Produce would make known its requirements. They said that the board would not make known its requirements, but these requirements would merely be an order to the board's officers.
      The witnesses were then asked "Where in the order is it said that it is the officers who have to mark the beasts and it is not an obligation on the owner in any way to see that they are marked?" The witnesses admitted that it was not in the order, but said that the procedure was that the board would require the animals to be so marked. Certain obligations fall upon the owner of the animal if it is properly marked or if it is wrongly marked.
      If it is properly marked it is immediately certified for slaughter. If it is certified for slaughter, the owner is obliged to slaughter it within the period of the notice given under Article 6. A great deal follows from the correct marking of the animal and no one reading the order—indeed no one, as I understand it, outside the offices of the board—would know what the correct markings are. Yet in Article 10 it is said that:
      "An animal marked as prescribed for any animal in Schedule 1.…shall be deemed to have been certified."
      The result of the marking leads to certification, which leads to certain obligations about slaughtering. The order should be made quite definite. It should be made clear that it is the obligation of the board to do the marking and not in any way an obligation on the owner and if the board fails to do it the owner is released from further obligations under the order.
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      The third point arises under Article 11. Perhaps I should first refer to Article 9, which requires the owner of the animal to keep certain records. Article 11 goes on to say that an officer can:
      "take possession of any book, account or record required to be kept by law and appearing to him to be material, or take a copy of, or extract from, any such book, account or record."
      The Department was asked through its witnesses, by the Statutory Instruments Committee, whether an officer would have a right to enter premises to seize books of account. The answer was that by virtue of a previous order, not mentioned in the present order, there was a general right of entry on land where animals were kept or slaughtered, but not necessarily where the books happened to be kept. The result, as I understand it, desired by the Department in drafting the paragraph, is that if the books happen to he kept on the land where the animals are bred or slaughtered, the officer can enter on to the land, provided it is land used for the production, storage, grading packing, slaughter or sale of any specified commodity.
      The witnesses were then asked "But what if the accountant keeps the books, as it is most likely he would do. Can the officer then enter the accountant's office to seize the books?" The answer was "No. That is not provided for, either in the previous order or this order." If that is the intention of the Department it should make it clear in the order when the officer can enter, and if it is to make a provision for entry it should have the usual protection about entering at reasonable times of the day and on notice.
      In those three respects the order is defective—in its lack of definition of Community arrangements, its lack of definition of the duties of the officer and the duties of the owner of the animal, and its lack of exactness over the right of entry. Perhaps the last is the most important. The House in many cases guards against entry by officials without permission, unless that permission is specifically granted. If the officers really want to enter with safety the right thing to do would be to get a warrant from the magistrates. Whatever right of entry is given or implied in the order, it

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      should be specific so that the individual knows exactly what his obligations are in allowing an officer of a board such as this to enter his premises.
      10.50 p.m.
      Mr. Norman Buchan: I do not wish to pursue many of the technical points, but the general point is extremely important in view of the discussions we have had at this time of night on a number of other orders. What has developed is the question of an order apparently functioning before it has been approved by this House. Also, the powers are quite considerable. I do not regard the powers of entry as being only a technical matter. It is an extremely vital safeguard of our liberties.
      On 10th April, when this order had already been in operation for some time, the following questions and answers took place:
      "What would happen if the books were kept in the accountant's office?"
      The answer was:
      "Yes, that is precisely what we pointed out to the Department and we said that there was no power to go into an office for the purpose of taking these books. They were quite happy about that, though".
      That was an extraordinary answer. Later the question was asked:
      "…the power of entry, if it is total and includes buildings, would entitle the officer to break into the building in order to obtain the documents. Is that not so? Surely it is, if 'land' means building'."
      The answer was:
      "I would not like to be dogmatic about that. I think the officer would be entitled to break in, but, I think, in doing so he would be wise to take a constable with him".
      I think that he would. This raises a fairly important point on an order which is already in operation.
      I turn to the question of the details of the order in relation to the functioning of the beef regulations and the Intervention Board, which may not last much longer. I do not see why we should accept that a permanent agreement has been made. The Foreign Secretary was heckled about this on Saturday. The heckler said "Only for 12 months, you clot ". I am not sure that the heckler was not right. Judging by the Farmers Weekly, he may have been nearer to the truth than the Foreign Secretary.
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      At the time of the agreement, Mr. Lardinois said that he did not expect it to last more than a year and that Britain would find it too costly. That view has been developed since the stocktaking initiated by the Germans. I take it that it was that to which the hon. Member for Cardigan (Mr. Howells), alluding to the Farmers Weekly, referred when he talked about taking one element of each system. If we do that, and if we have nine countries to choose from, by definition we may get one-ninth of our system applying. Which one-ninth?
      The great victory which apparently we achieved in Brussels a few months ago was in respect of the deficiency payments system. We have been told that this is the basic reason for our now supporting the common agricultural policy—what I call a derogation on beef and what others say is an option for any country to apply the deficiency payments system. One cannot apply a portion of a deficiency payments structure. One either has it or one does not.
      Any scheme involving payments for beef must have a complicated structure to prevent rigging and cheating. Therefore, we must have regulations for a scheme which may not last long. The hon. Member for Bodmin (Mr. Hicks) thought that it would be permanent—or at any rate permanent in 12 months.
      Mr. Hicks: I asked how long the scheme was likely to last.
      Mr. Buchan: I cannot answer that. Perhaps the Minister will do so. I have my doubts about it. If Mr. Lardinois was right in his first reaction that it was not expected to last long, and if the Farmers Weekly was right in saying that we shall have a mix, these things add up to suggest that once we have the referendum out of the way we may not find it so easy to continue with our derogation with regard to deficiency payments.
      There is a third point. It is extraordinary that every hon. Member concerned with farming welcomes the return to a deficiency payments system but that when we are on the last lap to the referendum we are all told how good the common agricultural policy has been. When they have to deal with the practical point they

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      are all against it, rather like the NFU, if I may have a minor derogation
      Mr. Deputy Speaker: Order. The hon. Gentleman has had a few minor derogations. I hope he will help me by keeping a little more closely to the order.
      Mr. Buchan: I was only going to point out the peculiar circumstances in which the NFU found time to vote in favour of the common agricultural policy while blockading the ports to prevent Common Market produce coming in. It would have been out of order to say more.
      Mr. Deputy Speaker: My trouble is that I am too polite. I am sure that that is not covered by the order.
      Mr. Buchan: That is why I concurred with your decision that it would have been out of order, Mr. Deputy Speaker.
      Therefore, we we have no reason to assume that the system will continue, despite the extensive requirements of the order.
      Secondly, it is initiated at our cost. While we welcome a deficiency payments system structure, we must remember that we are paying the variable premiums for which the order is necessary to safeguard our cash, to see that we are not paying premiums that we should not be paying. That which we welcome as a gain from the discussion on the common agricultural policy is the very thing for which we must ourselves pay, while continuing to pay the rest of our share for the common agricultural policy. In making a final decision tonight we do well to remember how big a percentage of the cost of the structure is met by Britain alone.
      The hon. Member for Bodmin said that this was an example of the reason why the farming community might be a bit fed up with politicians and the history of the past few months. I do not think that the farmers of this country would like to strip away all support structures for farming merely because they involve certain documentation. I do not think they would welcome a return to a high price policy, because then the producer section, the beginning of the cycle, would be at the mercy of the end price. There would be no guarantee that the high price would be paid back. We have needed to bring in all sorts of structures to safeguard certain elements of the production
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      line, and we should see such a consumer resistance that the farmers would no longer be quite so happy.
      Therefore, I welcome the introduction of the order despite its defects. I do not know what the legal position can be about putting right the defects. The House has been put in a queer position in putting into practice something with three fundamental errors, which were pinpointed in our examination of the matter on 10th April, and again tonight. Perhaps we should have a word from my hon. Friend the Minister on that, but I do not want to make his job difficult.
      I welcome the fact that we have some safeguards for our farmers and I deplore the position that made it necessary for us to welcome such a poor method of supporting our beef instead of the direct, straightforward, guaranteed price structure and deficiency payments.
      10.55 p.m.
      Mr. Hamish Watt: I welcome the order and thank the Minister for placing it before the House. It will help to restore confidence to the beef producers. The wounds of 1974 went very deep and the premium scheme will have to operate for many years before the confidence that was so easily lost in the autumn of 1974 is restored.
      The order fails in two respects. First, the premiums apply only to clean cattle. If we are to remain in the EEC it is high time our beef producers were on the same basis as beef producers of the other EEC countries. Fat cows and fat bulls presented to market should also be eligible for premium, as they are in other countries. Approximately one-fifth of all beef is produced from the two categories of fat cows and fat bulls, and it is unfair that cattle in those categories should not get the premium.
      Secondly, although it is reasonable to have a 15-day derogation of time between certification of the animals and slaughter, this works against the interests of producers of hill lambs. This is a narrow point but it is important for the producers of hill lambs. Often a glut of lambs comes on to the market—
      Mr. Deputy Speaker: Order. I am sorry, but the hon. Gentleman had better confine himself to the Beef Premiums (Protection of Payments) Order.
      Mr. Watt: I assure you that I am doing so, Mr. Deputy Speaker. I understand from what the Minister said that the order applies to lambs as well as to beef animals. Certification at such a time would militate against the production of lambs. The producer has only a few weeks—
      Mr. Deputy Speaker: Order. I apologise to the hon. Gentleman but it has just been pointed out to me that according to the order "animal" means an animal of the bovine species. I hope that the hon. Gentleman knows exactly what is covered by "bovine".
      Mr. Watt: I am sorry, Mr. Deputy Speaker. I shall have to bring this issue to the notice of the Minister at another time.
      I welcome the order and believe that it will help to restore confidence to the beef producer. I hope that it will apply not for 12 months but for many years to come.
      11.3 p.m.
      Mr. Ted Leadbitter: Most hon. Members who have sat late in the past debating agricultural matters are concerned about the manner in which this business is done in Parliament. It is totally unsatisfactory to have to debate statutory instruments and regulations and directives of the EEC on an Adjournment or "take note" motion or late at night, as we are doing now.
      The order is now in operation. What is worse is that when the Joint Committee on Statutory Instruments, chaired by the right hon. Member for Crosby (Mr. Page), took evidence on 10th April the witnesses purported to give serious evidence on an instrument already in operation. Although we are debating the matter tonight we are not allowed to make any decision. The procedural situation deprives us from having any influence. All we can do is express our opinion. [Interruption.] The hon. Member for Westmorland (Mr. Jopling) seems to want to discuss the matter from a sedentary position. I suggest that he gets on his feet or shuts up.
      Mr. Michael Jopling: I am provoked to rise to my feet. The hon. Gentleman said that the House had no power to take a decision tonight but
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      it is within his power to shout "No" when the Question is put.
      Mr. Leadbitter: Yes, but the order is already in operation. I am not prepared to bring Parliament into disrepute. I want my hon. Friend the Minister of State to listen to the increasing discontent that is felt by hon. Members on both sides of the House at the way business of this sort is being conducted. I am satisfied that the Chairman of the Joint Committee on Statutory Instruments would prefer to be able to take evidence before an instrument was in operation.
      I return to the evidence that was taken on 10th April. The situation becomes ludicrous when we have the Chairman saying:
      "First, I want to make it clear that the Community arrangements and the actual payments made do not come into this Order at all, this is just to identify animals on which the premium payments are made."
      The witness replied:
      "They do come into the Order in this sense. that reference is made to the Community arrangements in the first part of the Order. under 'Interpretation'. It has been so drafted that if the Community arrangements should change no change is necessary, within broad limits, in this Order."
      What is meant by "broad limits"? The House does not know. The Chairman asked where the reader of the order would be able to find the Community arrangements. He received the answer:
      "In the Community secondary legislation, Sir, under the heading of 'Beef and Veal'."
      Those who sifted through secondary legislation to look for something under "Beef and Veal" would have to admit to having many hours of spare time. Of course, we do not have that sort of spare time. That is not the kind of answer which leads us to believe that we are dealing with secondary legislation in a proper manner.
      The Chairman said:
      "Yes, but there is no indication in this Order directing him to that"—
      namely, to look through the secondary legislation. He received the answer:
      "There is no direct reference because the regulations have changed so much over the past few months that we still have not reached a state of complete rest on this subject, if I may put it that way."
      That is the sort of situation we face.
      Mr. Powell: I hoped that the hon. Gentleman was about to draw attention to what was near-frivolity in the evidence —namely, where the Chairman asked:
      "What I mean is, can anybody set themselves up and call themselves an Intervention Board for Agricultural Produce …?"
      He received the answer:
      "that would be a breach of copyright, or something of that kind."
      That question and answer seem to suggest that witnesses were not properly briefed and that they were treating the whole matter in a frivolous manner.
      Mr. Leadbitter: The right hon. Gentleman's comment about frivolity is right. Those of us who are used to Select Committee work know the need for precision and for getting a well-briefed answer. It is not a question of getting witnesses to come to the House to speak off the cuff, because that is fair neither to the witness nor to the Committee.
      I conclude by saying that my right hon. Friend the Minister of Agriculture has carried out an exceedingly good job in his negotiations. Having said that in appreciation of my right hon. Friend's work, I must point out that the House is being left in a state in which we are not able to carry out our work properly. Our forecasts about the way in which we would be treated in the Common Market are coming to reality far sooner than we expected.
      11.11 p.m.
      Mr. Hector Monro: I do not want to take up the remarks of the hon. Member for Hartlepool (Mr. Lead-bitter) except to say that on these agriculture orders Government back benchers prefer to use the occasion to discuss procedures on Common Market legislation rather than to deal with the practicalities of the order—namely, the subject of agriculture which many of us are here tonight to deal with.
      Will the Minister comment on some queries which I should like to put to him? I wish to say initially that I welcome the order, which affects Scotland as well as the rest of the United Kingdom. I wish to bring home to the Minister that it is necessary to have this order only because of the incredible tangle into which the Government got us over beef last year. The Government having got
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      us into that position, it is right to have the order as a life-belt to try to improve a situation created by the Government.
      I wish to ask the Minister about Article 4 dealing with certification. What is causing considerable comment in my part of Scotland is the grading standards used for certification. This is a crucial point. The lack of uniformity in grading is causing great concern not only among producers but in the National Farmers' Union.
      It appears that some cattle which fail to obtain certification at an auction mart are taken away, hung on a hook and graded a few days later. There is something very wrong with grading standards, and unless there is unification there are bound to be hard cases. If one is on the wrong side of a hard case, so to speak, there are serious financial implications. I wish to know what steps the Minister is taking to see that certification is uniform throughout the country. Since grading must be a matter of individual judgment it is not easy to achieve this, but what steps is he taking to bring the graders together into the agricultural community to go to auction marts and work together to find uniformity? Without such a system there will be unfairnesses.
      This is not something new. I have been complaining about it regularly for the last four or five months to the Secretary of State for Scotland. 'The Minister of State must therefore be well briefed to give me an answer. I look forward to hearing it.
      11.16 p.m.
      Mr. Paul Hawkins: I do not want to pursue the remarks of two of the speakers from Scotland, the spokesman for the Scottish National Party, the hon. Member for Banff (Mr. Watt), and the former Minister, the hon. Member for Renfrewshire, West (Mr. Buchan). I do not think that their criticisms of the Common Market have anything to do with this matter. I have never understood how anyone interested in farming could wish us to leave the Common Market. Farmers' interests all lie in our remaining a member.
      I wish, however, to follow my right hon Friend the Member for Crosby (Mr,Page) in drawing attention to some of the complicated procedures laid down in the order. As a former livestock auctioneer

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      I am particularly interested reference in Schedule 1 (2) to
      "a tattooed symbol unique to the animal being marked".
      An awful lot of instruments will have to be carried in auction marts if every bull is to be marked. Considering how many thousands of cattle will be involved, this is an extraordinary provision. I hope that the Minister will make it clear how this provision is to be carried out and what orders the board will give to its officers. There will be great practical difficulties.
      Many provisions of this sort are complex and difficult to carry out. We found this with the licensing of pigs to market. The only centres where licences could be obtained were sometimes 15 or 20 miles away from the individual producer, which entailed the expenditure of a great deal of time, petrol and money, and they could not be obtained from the local policeman. Could not such provisions be simplified for the benefit of the people who have to carry them out?
      Naturally I welcome the order, as anyone who has been rolled by a Cambridge roller welcomes a helping hand to pick him up, flattened though he may be. During 1974 the beef producers lost confidence in the beef market, which he has not fully regained. My hon. Friend the Member for Bodmin (Mr. Hicks) said that it took three years to produce beef. If one bears in mind picking out the heifers to be put to the bull and choosing the cattle to be fattened it could actually take four or more years. This morning I looked at between 700 and 800 beef cows on a farm. The farmer was seriously considering cutting back on the number of his cows. He said "We have a guarantee for only one year. If we do not remain in the EEC, if we do not get the end price of the EEC, it will be useless for us to continue producing beef."
      I welcome the order but I ask the Minister to give us long-term assurances. The number of calves slaughtered over the past few months, particularly in the past week, when it was twice the number in the same week last year, does not augur well for long-term beef production. Anything which gives any degree of confidence is to be welcomed. There is much more to be done, not only for farming in general but particularly for
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      long-term projects like this. This requires investment in capital, investment in stock and a long-term programme to produce the beef which is required by the farmer, the housewife and the nation. If the order provides some incentives for securing that, it is to be welcomed.
      Mr. Bishop: This has been a good debate. If I do not reply to all the questions in the short time available to me, I shall write to those concerned.
      My hon. Friend the Member for Durham (Mr. Hughes) asked what was the source of the premium funds. The Community regulations provide for payments of a fixed headage payment entirely from FEOGA funds and give member States the option to pay an additional premium within certain limits. This is the variable premium. The United Kingdom has taken up the option and is paying a supplementary variable premium from our own funds. The head-age payments come from the Community, the other premiums come from our own funds.
      As for my hon. Friend's question about the control over exports of certified animals, the premium scheme is a Community-wide scheme. All animals certified alive in the United Kingdom must be slaughtered within the Community within the period allowed or the premium will be forfeit. The fact that animals are permanently marked will prevent them from receiving a further premium from another member State.
      As for what has been reported to have been said by Commissioner Lardinois, I am glad to note that he referred to the merits of the United Kingdom arrangement and suggested that the mixed arrangements of the kind which we operate may form the basis of the future EEC beef regime when it is further reviewed.
      I draw attention to these words of my right hon. Friend on 9th April:
      "Of course, we have to undertake new price settlements for every commodity arrangement each year and we set such considerable store on the need for continuing satisfactory arrangements on beef that I will not agree to any future settlements which do not meet this need.
      Meantime, the changes we have secured in the beef regime are evidence of a welcome flexibility in the operation of the CAP."—[Official Report, 9th April 1975; Vol. 889, c. 1249.]

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      The hon. Member for Bodmin (Mr. Hicks) asked about the technical differences between this scheme and the Fat-stock Guarantee Scheme which operated until 1973. The only technical difference is the requirement that the animal must be slaughtered within the specified period. The hon. Gentleman may recall that I made this point in my opening remarks.
      Questions were raised by several hon. Members about the temporary arrangements due to last for 12 months. The new arrangements form an integral part of the support arrangements in the 1975–76 marketing year. They will be reviewed in the Council of Ministers at the end of the marketing year, as with the intervention arrangements and other support mechanisms. We are confident—this was the point made by my right hon. Friend in the debate on 9th April—that the new system will demonstrate the advantages in the course of the current marketing year, and that if we continue as members of the EEC the Community will, in the light of its experience this year, continue to support beef producers on these lines.
      The hon. Member for Bodmin also asked a question about the monthly target prices being announced for a longer period. I appreciate the kind of assurances which the producers want. It is desirable for producers to know the target price as far ahead as possible, but in the present state of the beef market it would have been very difficult to assess the appropriate level for more than three months in advance. The hon. Member will be aware that we are committed to the target price of between £22 and £23 per live hundredweight over the year. This is the system which we are working out.
      The reply to the question about the need for publicity of the order is that a revised leaflet describing the scheme is now being prepared by the Intervention Board and it will give full details of the scheme, including the provisions of the order. Notices will be prominently displayed at auction marts and slaughterhouses drawing attention to the main provisions of the order.
      In reply to the question about the scheme being an EEC scheme and the reason why it is necessary to have United Kingdom legislation, the purpose of the order is, as I said earlier, to fulfil the
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      obligation to protect both United Kingdom and Community funds. There is no difference in principle between this and the other subordinate legislation which has been produced towards this end.
      I have already commented on the appropriate references to the CAP (Agricultural Produce) (Protection of Community Arrangements) legislation.
      On the questions raised by the right hon. Member for Crosby (Mr. Page). which I thought were very relevant, about the Scrutiny Committee's findings, the object of defining premium payments in the way in which it has been done is to give permanence to the order. The present arrangements continue into 1976. They may be succeeded by others, in which this order will also apply.
      The right hon. Gentleman made an important point about matters concerning the Scrutiny Committee, one of which referred to the marking of animals. The Committee observed that Article 4 (1) states that where an animal has been approved for certification and has been sold for slaughter,
      "the animal shall immediately be marked as prescribed…"
      but Article 4 (6) fails to state clearly that the marking is to be carried out by officers of the Intervention Board and not by the producer. Article 3 of the order, however, provides that:
      "The examination, approval, marking and certification of animals and carcases in connection with applications for premium payments shall be carried out by or on behalf of the Board."
      This provision covers every reference to marking in the order.
      Another question related to the power of entry to premises. This is the second point made by the Scrutiny Committee. In drafting the order it was decided that the powers in Article 11, together with powers of entry already provided for in Article 4 of the Common Agricultural Policy (Agricultural Produce) (Protection of Community Arrangements) (No. 2) Order 1973, provided all that was requited by the Intervention Board in any circumstances in which such powers could be envisaged as being necessary. The order accordingly provides no power of entry, either express or implied. It was considered that the order could otherwise have been criticised as providing suck power unnecessarily.

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      The other points which have been raised include the comments by my hon. Friend the Member for Renfrewshire, West (Mr. Buchan) and others, concerning intervention. As my right hon. Friend has said on many occasions, the Government do not believe that intervention should be the primary method of support for beef producers. I appreciate the comments by hon. Members on both sides of the House about the way in which my right hon. Friend has been campaigning within the European Community over the past year to ensure that we have greater flexibility and can operate by way of intervention or otherwise.
      We have said on many occasions in the House that we do not favour intervention. We were criticised from time to time for the fact that there was no floor in the market. Now we have the right not to operate intervention as the primary method of support, and at the same time we have the floor which has been sought by the industry for the past few months.
      I think that those are the main points which have been raised in the debate—
      Mr. Monro: What about the grading of cattle?
      Mr. Bishop: With regard to cattle standards, inquiry has been made into a number of complaints about the standards operated by grading officers but there has been little evidence of inconsistency in grading and I can say that the standards operated under the Fatstock Guarantee Scheme are being fully maintained. But I promise the hon. Gentleman that his remarks will be borne in mind.
      With regard to the question raised by the hon. Member for Banff (Mr. Watt) concerning certification, the scheme continues the arrangement operated under the Fatstock Guarantee Scheme whereby certification has been awarded to clean cattle, including young bulls. Cows are specifically excluded throughout the Community. That may answer the hon. Member's point.
      I believe that those are the main points—
      Mr. Hawkins: Will the Minister say something about
      "a tattooed symbol unique to the animal being marked"?
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      Will he say why each animal should have this unique mark?
      Mr. Bishop: I believe that the hon. Member is referring to Schedule 1, paragraph 2, in relation to marking. I believe that the answer is that this is a matter of unique marking with particular reference to individual cattle, as compared with an alternative marking, but this is a matter on which I should like to write to the hon. Member when I have more detailed technical information.
      I think that those are the points—
      Mr. Leadbitter: There is a reasonable amount of time left for my hon. Friend to give us an undertaking on a matter which concerns us. Will he put it to his right hon. Friend in the manner that put it to him? Can these instruments be brought before the House in a different way? In future, can the House expect to debate statutory instruments when the evidence taken in connection with those statutory instruments will be clear, before we reach the situation in which we are now? My hon. Friend knows the situation, and I am sure he will take up the matter with his right hon. Friend in the manner in which the House would ask for it to be done.
      Mr. Bishop: My hon. Friend may recall —he may or may not have been present—that as Agriculture Ministers we have had a good share of the time of the House—albeit at this time of night—to debate orders of this sort and other matters affecting agriculture which are before the EEC. The time of the debate is not a matter for me or for my right hon. Friend; it is a matter for my right hon. Friend the Leader of the House and, perhaps, other channels.
      With regard to the fact that we are debating this legislation, I have pointed out on other occasions that we are fortunate to have time to debate it. I remind my hon. Friend that many statutory instruments and orders which go through the House during the year are never debated. We are fortunate in having time to explain the situation to the House regarding the legislation put before it—legislation that we are seeking to have approved by the House.
      Mr. Leadbitter: I accept that point. Will my hon. Friend therefore now bring the matter to the attention of the Leader

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      of the House to see whether we can arrive at a better situation in respect of these matters?
      Mr. Bishop: I think that I can risk the responsibility for doing that.
      Question put and agreed to.
      Resolved,
      That the Beef Premiums (Protection of Payments) Order 1975, a copy of which was laid before this House on 19th March, be approved.

    PETITION

      Personal Data Records
      Mrs. Millie Miller: With your permission, Mr. Deputy Speaker, and that of the House I beg leave to present a petition, signed by 7,500 persons from a wide variety of areas in the country, the subject of the petition being a request to the Government to provide freedom to individuals and defined groups to inspect written or other recorded information on and concerning them kept by any official body.
      The basis for the petition is the growing presence in many official quarters of files about individuals to which they have no access and no opportunity to rectify any errors which appear in the files.
      I beg leave to submit the petition for the consideration of the House.
      To lie upon the Table.

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

      FARMING (SUSSEX WEALD)
      11.36 p.m.
      Mr. Peter Hordern: I wish to draw the attention of the House to the problems of farming on the Weald of Sussex. Perhaps I should explain that the Weald of Sussex is that part of Sussex lying north of the Downs, which was once an extensive forest but of which only St. Leonard's Forest and Ashdown Forest now remain. In times past, all those who travelled through the Weald were unanimous on
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      one matter, the villainous state of the roads. It was the clay which made them virtually impassable—a thick, glutinous clay—and it is this same clay which, despite all attempts at drainage, makes farming exceptionally difficult.
      Farming on the Weald is always late, much later than on the greensand which is only a few miles to the west, and sometimes it is too late altogether. The pattern of farming on the Weald is unlike that in the broad acres of Hampshire. There is a high proportion of small dairy farms, often tenanted, but, large or small. they have one thing in common in that all are losing money.
      For at least a year I have been writing to the Minister to warn him of this situation. I have given the most detailed figures and costings provided by my farming constituents, and he has done nothing to relieve their anxiety. There are four main points of concern, which can be summarised as clay, cash, capital and confidence.
      There is not much to he done about the clay, particularly in the miserable weather which we have had recently, but the evidence is there for all to see in the large number of cattle being brought forward for slaughter, in the emaciated condition of many of the animals and in the photographs of tractors churning about in the clay. On the Weald, spring has barely begun.
      Cash is another problem. In 1974 agriculture saw its greatest decline in aggregate net incomes, a drop of nearly 30 per cent. That is the average over the country as a whole, and the position of Wealden farmers was much worse than the average. One has to take into account also the increase in costs, which rose by £692 million last year, largely as a result of inflation. Inflation, however, is getting much worse, not better, and its effects can be found in every aspect of our lives though in no more striking way than in agriculture. The Government bear the sole responsibility for inflation, and they alone have the means to relieve its worst consequences for farming.
      At present, there is a serious cash shortage. I understand that costs for the 1975 wheat crop on the Weald have risen to £90 an acre, and are likely to reach £106 an acre for the autumn-sown 1976 crop. I am told that it is impossible

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      now to get a yield of 30 cwt. to the acre, so that with a market price of about £50 a ton in prospect it will be impossible for the Wealden farmers to cover costs.
      That is the situation at present. Of course it may be better elsewhere, but the Government have to take account of the marginal areas in their policy if agriculture is to succeed. That is why the Government's recent White Paper "Food from Our Own Resources" has been met with such incredulity. Paragraph 16 points out that the total area of agricultural land in the United Kingdom is declining at the rate of 144,000 acres a year. Every year there is much less farming land.
      We are told that between 1972 and 1974 our net deficit in trade in food rose from £1,750 million to nearly £3,000 million. The Minister himself says that we can no longer expect to find cheap food elsewhere. The conclusion must be that we must encourage our own food production by every means we have. Unlike so many other industries which the Government are supporting, agriculture has proved its efficiency and its productivity. In recent years production has been growing so that agriculture now produces two-thirds of the food which can be produced here with a much reduced workforce. This compares favourably with agriculture in the other countries of the EEC.
      Paragraph 23 of the White Paper says:
      "If farmers are to invest in expansion, they need a degree of assurance about their future returns."
      But what sort of assurance do they get? None at all. It is quite clear that if the Government's programme for agriculture is to stand a chance of success, the marginal land will have to be used to the full. This is particularly so in the case of dairy farming, for which the Weald is best suited.
      Paragraph 46 of the White Paper shows, in the assessment for 1980, that dairying, together with the beef from the calves produced, would be likely to offer the United Kingdom, as a member of the EEC, a greater margin than lowland beef over the resources used. Table 2 in that document shows that milk production could increase by 620 million gallons by 1980, an increase of £220
      200
      million at EEC farm gate prices, which is the largest increase of all agricultural products.
      Furthermore we are only 60 per cent. self-sufficient in milk, which is one of the lowest proportions of all the EEC countries.
      The farmers' unions believe that the extra capital costs will come to between £425 million and £500 million at current prices, I do not know what rate of inflation they are assuming, but I should not be surprised if that was an underestimate. From that estimate, however, one conclusion is inescapable. There is no prospect of achieving anything like that level of production unless we make the fullest use of all our agricultural land and unless it is made profitable to farm in marginal areas. That is plainly not the position at present.
      The Government must be made aware of the damage that is being done to agriculture through the capital transfer tax and through the proposals for a wealth tax. Farming is very much a family business. Of course, it makes sense to invest in more land and more machinery in a good year because the economics of farming favour larger units. But what farmer does not believe in doing so in order to provide for his family, to enrich and enlarge the land he owns to pass on something better for his family? What incentive is there now to carry out such a policy? Why should a farmer build up his farm only to find that he has to pay a heavy burden when he passes it on to his family?
      The alternative is for a farmer to spend the earnings he gets from farming instead of reinvesting them, and that is what he will do. Especially is this so in the marginal areas such as the Weald, where profits are so small in any case. These arguments apply equally to the wealth tax. The Government do not seem to understand that farming is essentially a creative business. What suits the farmer and his family must by definition suit the country. If what happens does not suit him, we shall find that farming land will be allowed to deteriorate and the Government's objective of raising production will be impossible to achieve. That is what is so important about capital. Without it there can be no future for farming.

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      English farmers do not look upon themselves as Russian kulaks. What they mean by a secure long-term future is the prospect of creating a fruitful asset of their farm. Of course, this means creating capital. If the Government do not understand this, they will never achieve a successful agricultural policy. That is why I welcome the fact that the Conservative Party is pledged to repeal the capital transfer tax.
      There are, however, certain measures that the Government can take to ease the present desperate situation of farmers on the Weald. I remind the Minister of his statement of 11th December last. It was designed to give help to livestock feeding in winter. The hon. Gentleman announced a headage payment of £15 per hill cow moved from a hill farm to a lowland area. It was forecast that the total cost would be £150,000. I should like to know what has happened to that fund. How much has been taken up? If, as I understand, much is still there, cannot some of it at least be used for farmers in the marginal areas such as the Weald?
      The Government also announced guaranteed bank loan subsidies for hill farm grants made by the Agricultural Mortgage Corporation. I think that that was announced at the same time. Could not these loans be extended to apply to hill farmers as well?
      The principle of special aid to marginal farming, such as the hill sheep subsidies, is well known and accepted by the Government and by the European Community. I understand that by the draft Instrument R/27/75 a directive has been issued that allows for a 50 per cent. rebate from Community funds for headage payments made by member States from the beginning of 1975. I believe that the United Kingdom is the principal beneficiary of this proposal.
      Certainly a large number of counties seem to benefit from it, not only Cumberland and Northumberland, but Somerset, Shropshire and Herefordshire, which are not particularly noted, I would have thought, for their difficult farming areas. If they are included, why not the Weald of Sussex as well? Certainly the Weald would seem to fit at least one of
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      the criteria—it has a low grass yield compared with the national average.
      I thought it right to draw the attention of the House to the particular problems of my constituents farming on the Weald. I conclude by saying that, useful as any temporary expedient may be, there is no alternative to the main requirement and that is to make farming profitable. If we are to secure our own food supplies, there is no alternative to providing farmers with the long-term incentives that they need by allowing them to create capital by ploughing back profits, by creating greater investment and by creating a renewal of the confidence that farmers everywhere so desperately need.
      11.48 p.m.
      The Minister of State for Agriculture, Fisheries and Food (Mr. E. S. Bishop): The hon. Member for Horsham and Crawley (Mr. Hordern) has given us a description tonight that I expected, and, of course, he has dealt with some of the problems that have been encountered by his constituents and others who farm on the Weald in Sussex. I think it useful to have this opportunity to debate the problems which he has outlined and which affect particularly his part of the country.
      Some of those problems are no doubt facing farmers on heavy land in other parts of the country, and I recognise that the main problems that the hon. Member and his colleagues face in his constituency are connected with the clay soil. The wet winter and spring have certainly created major difficulties, which the hon. Member mentioned, particularly for those who want to grow cereals on the Weald. Such difficulties are an unavoidable hazard for cereal production on such land.
      A number of small farmers on the Weald are always liable to face special problems in operating as viable units, and the hon. Member referred to the smaller units. The Ministry's advisory staff do all they can to help and I know that farmers on the Weald did much to help each other with the problems of fodder they faced during the winter. It must be recognised that some of the problems which have been faced on the Weald are due to structural and husbandry factors to which there are no easy answers.

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      The weather, to which the hon. Member referred, is an important factor in farming. The immediate cause of the difficulties described by the hon. Member tonight was the wet winter and the unexpected and unusual cold snap at Easter. There was also the problem of turning out stock during that period, with a consequent effect on fodder. That also held back the spring growth of grass.
      The hon. Member made the point about cereals being grown in his area. There are particular problems concerning the heavy soil. We are naturally concerned about the effect of the wet weather on cereal production prospects. Growers on heavy land on the Weald were unable to get much of their winter wheat in and over the country as a whole there has been about 20 per cent. less winter wheat sown than last year. On the Weald, winter ploughing is still unfinished.
      Waterlogging is restricting growth and little spring sowing has been completed. This is clearly worrying for those who depend upon cereal production as the best way of utilising land not used for livestock production. Whereas normal rainfall allows the heavy Weald soil to be ploughed for cereals, the abnormal conditions we have had this year have made cultivation difficult.
      The fodder situation has been discussed in correspondence with the Ministry. The land conditions and the weather accentuate the problems, which have been variable in different parts of the country. The effect of the weather has been mixed. The mild winter allowed stock to be kept out more than usual. It has led to the problem of damage to pastures in wet conditions. Overall the weather has helped to ensure that the worst fears about fodder supplies have not been realised. We also had a record cereals harvest last year. This has helped considerably with feed supplies although there was still a need for ruminants to have roughage. Also, though unwelcome to cereal growers, the fall in cereal prices this year has been a significant help to the livestock sector.
      The hon. Member referred to the cash flow position, particularly with regard to fodder. The Government have done a lot to help the cash flow of many
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      of the hardest hit. Last October there was a special increase in milk producers' prices worth nearly 8p per gallon over the six winter months. The 1975 beef cow subsidy payments, as well as the hill cow subsidy payments, were brought forward and cash flow over the winter months was thus improved. The Agricultural Development and Advisory Service has been and continues to be available to advise on the most efficient and economic use of fodder and other resources. Throughout the country there has been liaison between ADAS and the NFU which has been of value in overcoming some of the worst problems facing farmers.
      I turn to the dairy industry. For most of the 1974–75 period the milk yields per cow were at the same low level as in the previous year, principally because rising costs led to a reduced use of the concentrated feed. Yields had begun to Improve this year and were running at a higher level than in the same period in 1973–74 until the setback in the weather in late March and early April.
      Not all parts of the country have had the same pattern. I appreciate that the Weald in particular seems to have suffered from the abnormally wet weather, principally because of the nature of the soil. I have been reading some of the correspondence from the hon. Gentleman's constituents and discussing the situation with our regional officers.
      On all the various problems currently facing farmers on the Weald the Ministry's advisory officers arc ready to help. They are very busy answering farmers' inquiries about how best to get their land into cultivation and deal with the problems caused by the poaching of pastures. They are ready to help with advice on the best use of fertilisers and the use of resources on the land and other facilities so as to minimise cereal losses at harvest time following the difficulties of winter and spring. In conjunction with the local NFU, they will hold a large open meeting next week in the Horsham area. This meeting will be aimed at providing farmers locally with further advice on ways of coping with this year's production problems.
      Communications in the industry are important. Sometimes people wonder whether the Ministry or indeed Ministers

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      are au fait with some of the problems affecting various parts of the country. Most people will appreciate that there is a very strong link between the Ministry and Ministers and the industry. I pay tribute to all the NFU branches throughout the country because they never miss an opportunity to make known the conditions affecting the industry. There is the Ministry's regional organisation and the ADAS officers, to whom I pay tribute for their advice to people in need. I mention also the work done by the regional panels which are appointed by the Minister in the various parts of the country and with whom Ministers are in contact out in the regions as well as in London. We get impartial advice which is valuable in providing the important links between the people they represent and the Ministry.
      The hon. Gentleman referred to the fall in farm incomes last year. We do not deny that 1974–75 was a difficult year. especially for the livestock sector. The figures were set out in this year's Annual Review White Paper. However, one must remember that, although farm incomes fell last year, this followed a very large increase in the year before. Aggregate net income in 1973–74 was 49 per cent. higher than in 1972–73. The fall last year still left aggregate net income 31 per cent. higher than in 1972–73.
      Mr. Michael Jopling: I am surprised to hear the Minister using that argument. Does he mean that the Government will be content to allow aggregate farm incomes to drop until all the good work done by the Conservative Government has been dissipated and we return to the miserable days of 1970 when farmers were demonstrating on the streets?
      Mr. Bishop: I do not want to be partisan, but we inherited some problems, which would have arisen anyway, not necessarily because of the Conservative Government's policy but due to worldwide conditions, such as inflation and the oil situation. One has to take income one year with another. It is good when the industry has a big increase in income, and we recognise the problems which the industry faced last year when income was severely reduced. But I still think that the point is that income
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      over a period of years is the matter to which we should have regard.
      Mr. Hordern: The point is that most of the Weald farmers are dairy farmers and they had had another bad year the previous year. It was the cereal farmers who did well the previous year, but, unfortunately. not enough of them farm on the Weald.
      Mr. Bishop: The hon. Gentleman will recall that in the last six months there was an increase of nearly 8p a gallon—one of the biggest increases over that period of time under any Government in the last few years. However, we recognise the problems of the industry, and it is no help to farmers for us to average out incomes when they face problems in years which are not so good.
      There was the annual review and there was the CAP prices, and the Government did much last year to alleviate the situation. Livestock produces on the Weald have benefited from the special pig subsidy. the temporary increase in the calf subsidy and the beef premiums. In addition, the industry's difficulties were taken into account in this year's review. The determinations made following the review provide substantial increases in guaranteed prices and, taken with the increases in the CAP prices for 1975–76 and the new EEC beef régime, they provided a sound basis for farmers' production plans in the coming year. Overall there was a major increase in the levels of support. The new beef régime is not only a radical improvement in the EEC system but gives producers a real assurance of a substantial level of returns, more than 20 per cent. higher than in 1974–75.
      The hon. Gentleman made a relevant comment on the Government's long-term White Paper, which was produced after a great deal of consultation with the industry, the NFU, employees' organisations and so on, to give long-term assurances for the industry to have the necessary confidence. Much of the detailed filling-in on the support and the financial aspects will have to be considered after the debate on the referendum is over in June. By producing a long-term White Paper the Government have set out the main objectives that we

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      hope to achieve in the next few years, into the 1980s.
      A brief reference was made to capital taxation. We are all aware of the concern expressed throughout the country about the possible effects of capital taxation. The Government's measures of capital taxation are designed—I am sure that the hon. Gentleman will not disagree with the objective—to bring about a more equitable distribution of wealth. The Government have said clearly that they recognise the special problems relating to agriculture. This was made clear in the White Paper, Cmnd. 5705, dealing with the capital transfer tax. The Finance Act 1975, which gave effect to the tax, provided special relief for the land of the full-time working farmer. In addition, in his recent Budget Statement my right hon. Friend the Chancellor of the Exchequer announced his intention of introducing a similar relief in regard to capital gains tax.
      The proposals for a wealth tax are still under consideration by a Select Committee. In the Green Paper on the wealth tax the Government made clear, in paragraph 34, their recognition of the special problems of agriculture.
      The Government have made it clear that they recognise the special needs of agriculture in relation to capital taxation, and that we shall be keeping the situation under review. This is no idle statement. The recent White Paper "Food from Our Own Resources" (Cmnd. 6020) explained that the Government were setting up certain specific studies on issues which could be important to the achievement of potential growth in agriculture. One of these studies will be a review of the effect of capital taxation on agricultural production.
      I believe that I have dealt with the main issues which have been raised. As I said at the beginning, many of the problems raised affect our agriculture industry as a whole and not only farmers on the Weald. Therefore, I am grateful to the hon. Gentleman for the opportunity to reply to some of the points he raised.
      208
      The Government believe that there is a long-term future for agriculture nationally. We must fill in the objectives as we go along in the annual reviews and in our continuing negotiations with the Common Market, provided we stay in the Community.
      In their determinations over the past difficult year the Government have shown the ready help which has been available. We intend to maintain the reassurance which the industry needed. When the hon. Gentleman talks about the difficulties of the past 12 months, it is relevant to point out that about £300 million was spread over many commodities.
      The milk producers have had a considerable share. They are being paid a quite large increase. Government subsidy payments were made soon after we came into office in March 1974. Help was given to pig farmers with the payment of 50p a score for a considerable period, and that was welcomed by the industry. The hill farmers have had a considerable income boost as a result of the legislation introduced by my right hon. Friend and, as I said earlier, the beef and hill cow subsidy payments which were brought forward in January this year have helped the cash flow.
      The hon. Gentleman will recall the fodder survey and the action which was taken last winter when we recognised the special problems which faced the livestock industry and the need to make sure that adequate supplies were available. Over the past year my right hon. Friend has not been slow in taking action within the Community and within this country to ensure that the farmers have had the assurances which were necessary. I know that on occasion the industry has accused us of having a "fire brigade" policy—
      The Question having been proposed after Ten o'clock on Monday evening, the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
      Adjourned at six minutes past Twelve o'clock.

SOCIAL SERVICES
  Birmingham and Midland Eye Hospital
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  Family Allowances
  Family Allowances
  Kidney Dialysis
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  Expenditure
  Expenditure
  Geriatric Beds
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  Mortgage Repayments (Women)
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  Supplementary Benefit Claimants
  Supplementary Benefit Claimants
  Retirement Pension
  Retirement Pension
  Family Support
  Family Support
  Hearing Aids
  Hearing Aids
  Breast Cancer
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  Unemployment Benefit
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  MEMBERS OF PARLIAMENT AND MINISTERS (PAY)
  MEMBERS OF PARLIAMENT AND MINISTERS (PAY)
  EUROPEAN COMMUNITY MEMBERSHIP (REFERENDUM)
  EUROPEAN COMMUNITY MEMBERSHIP (REFERENDUM)
  REFERENDUM INFORMATION UNIT
  REFERENDUM INFORMATION UNIT
  MINISTERS' TRANSPORT
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DEFENCE
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EDUCATION AND SCIENCE
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EMPLOYMENT
  Retail Trades
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PRICES AND CONSUMER PROTECTION
  Caravan Sites
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  Price Commission
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TRADE
  Scotland (Cross-Border Trade)
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  Knitwear (Pseudo-Scottish Names)
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  Nation Life Insurance Co. Ltd.
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  USSR
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  Thomas Cook and Son Ltd.
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AGRICULTURE, FISHERIES AND FOOD
  Bacon
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  Tied Cottages
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ENERGY
  Power Stations
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  National Heat Grid
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ENVIRONMENT
  Council House Tenants (Subsidy)
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  High Alumina Cement
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  A259 (Winchelsea)
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  Corporation Houses
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  Parks and Recreation Areas (Vandalism)
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  Council Houses (Vandalism)
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  Council Houses (Repairs)
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  Housing (Merseyside)
  Housing (Merseyside)
  Housing (Notices to Quit)
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  South West Water Authority
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  Land Compensation Act 1973
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  Bilsborrow Hall, Preston
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  Kenpas Highway and Fletchampstead Highway, Coventry
  Kenpas Highway and Fletchampstead Highway, Coventry
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  Housing (North-West and Manchester)
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  North Atlantic Treaty Organisation
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FOREIGN AND COMMONWEALTH AFFAIRS
  Rome Embassy
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  Vietnam
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  Uganda (Mr. D. C. Hills)
  Uganda (Mr. D. C. Hills)
  FINANCE FOR INDUSTRY
  FINANCE FOR INDUSTRY
HOME DEPARTMENT
  Animal Experiments (Scotland)
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  Remanded Juveniles
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OVERSEAS DEVELOPMENT
  Namibia
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SCOTLAND
  Public Expenditure
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  Primary School Classes
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  Schools and Housing (High Alumina Cement)
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  Highlands and Islands Development Board
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  Rural Transport
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  Land Compensation Act (Operation)
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WALES
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INDUSTRY
  West Scotland
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  Waste Plastic
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  Scotland
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  Steel
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  British Leyland
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  Nationalisation
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  Shipbuilding and Aircraft Industries
  Shipbuilding and Aircraft Industries
  HOUSE CONVEYANCING
  HOUSE CONVEYANCING
  PROPERTY REGISTRATION
  PROPERTY REGISTRATION
  PLANNING (EASTBOURNE)
  PLANNING (EASTBOURNE)
NATIONAL FINANCE
  Retail Price Index
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  Gross Domestic Product
  Gross Domestic Product
  Tax Surcharges and Thresholds
  Tax Surcharges and Thresholds
  Personal Incomes
  Personal Incomes
  Budget (Price Effects)
  Budget (Price Effects)
  Public Expenditure
  Public Expenditure
  Value Added Tax
  Value Added Tax
  Social Wage
  Social Wage
  Widows
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  Corporation Tax
  Corporation Tax

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

HUNTINGDON RESEARCH CENTRE TESTS
Lord HOUGHTON of SOWERBY Lord HOUGHTON of SOWERBY: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether any experiments are at present being conducted at the Huntingdon Research Centre on primates or dogs comparable with those on the beagles at the laboratories of Imperial Chemical Industries and, if so, how many animals are being used in these experiments, and whether any such or similar experiments will be referred to the Advisory Committee for examination.
The MINISTER of STATE, HOME OFFICE (Lord Harris of Greenwich): My Lords, ninety-one primates are being used in comparable experiments at the Centre. The Advisory Committee will be examining the use of dogs in experiments to develop new smoking materials. In the course of this examination it will, no doubt, consider the use of other animals in such experiments.
Lord HOUGHTON of SOWERBY: My Lords, will my noble friend consider whether the present lack of co-operation between the tobacco interests and Her Majesty's Government on further emphasis of the health hazards of smoking should now be brought into consideration in the conduct of further experiments of this kind? If we cannot get co-operation from the tobacco interests in emphasising the health hazards, why should we co-operate with them in conducting experiments on animals to find some alternative to smoking?
Lord HARRIS of GREENWICH: My Lords, I will gladly draw the attention
1150
of my right honourable friends who are principally concerned to the points made by my noble friend.

ABORTIONS
2.39 p.m.
Lord HOUGHTON of SOWERBY Lord HOUGHTON of SOWERBY: My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether any of the matters of a criminal nature referred to in the book Babies for Burning have been resolved, and, if so, whether charges against persons alleged to have been involved have yet been made.
Lord HARRIS of GREENWICH: My Lords, the position remains as stated in the Answer I gave to my noble friend's Question on 16th April. The police are continuing their inquiries; when they are completed a report will be made to the Director of Public Prosecutions, who will consider whether any charges should be preferred.
Lord HOUGHTON of SOWERBY: My Lords, may I ask my noble friend whether, in giving that Answer, he has taken account of the fact that on 6th March in this House the noble Lord, Lord Wells-Pestell, described as "murder" one of the allegations contained in this book? Is it not an urgent matter to resolve allegations which involve, if proved, a charge of murder? May I ask my noble friend whether he is aware that one of the co-authors of this book has expressed willingness to place tapes at the disposal of the Select Committee? May I further ask whether those tapes have been placed at the disposal of the police?
Lord HARRIS of GREENWICH: My Lords, I think no one would deny that the allegations made in this book, and all the circumstances surrounding it, are very serious matters, and certainly the police are pursuing their inquiries with some vigour. As I indicated to the House last week, there was some problem about interviewing one of the authors of the book, but I am glad to say that this author has now been interviewed by the

1151
police. Certainly there is keen realisation by the Commissioner of the importance of this matter.

REFERENDUM BILL
Brought from the Commons on Friday last and printed pursuant to Standing Order No. 48; read la.

FRIENDS' PROVIDENT LIFE OFFICE BILL
The CHAIRMAN of COMMITTEES (The Earl of Listowel): My Lords, I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read 2a. —(The Earl of Listowel.)
Lord CASTLE: My Lords, I do not want to interfere with the progress of this Bill towards becoming an Act, but there are certain considerations which have been brought to my attention and which I should like my noble friend to examine in Committee. When the Committee is examining this Bill, will it please take into account the very different nature of a mutual insurance society, which is owned by the policyholders, from a commercial insurance company, which is owned by shareholders who effectively have no policy stake in the company? I am sure the Committee will wish to satisfy itself that the Bill ensures that the right to acquire and sell assets takes into account the need to seek the approval of the policyholders and, at the same time, to see that the interests of the staff are properly protected.
It appears to those who have examined the Bill in detail—I cannot claim to have done that at this moment—that the Bill could give the board of the Friends' Provident Life Office continuing powers to effect mergers without reference to the policyholders, which is inconsistent both with the Bill's alleged modernising objectives, as stated in the Preamble, and with the spirit of current legislation affecting
1152
mergers. At the beginning of this year the board sold a wholly-owned subsidiary, the Century, to a nonmutual society—the Phoenix Insurance Company —which is partly Americanowned. Of course, it is no worse for being that. But the board did so without any reference to the policyholders who own the society. Nor were the interests of the staff taken into account.
Previously, the Friends' Provident Life Office had a trade union procedure agreement with the Association of Scientific, Technical and Managerial Staffs, giving it bargaining rights for the staff with all the subsidiaries as well as the main company. Since the sale the new owners, Phoenix, are putting barriers in the way of trade union recognition for ASTMS, although the majority of members of the staff of Century are ASTMS members and it is, in fact, giving support to its own sponsored staff association. What is very much in doubt is whether the policyholders would have approved of either this lack of regard for staff interests, or the sale of the Century to a commercial insurance company with a substantial amount of foreign ownership. I am sure the noble Lord will understand the disquiet and will examine the proposals made in the Bill in the light of what I have said, and the fears which policy-holders and staff of the Friends' Provident have expressed.
The Earl of LISTOWEL: My Lords, I am grateful to the noble Lord, Lord Castle, for his observations on the Bill. I have taken a mental note of what he has said and I will refresh my memory by reading Hansard. I can assure him that all the points raised will be carefully considered when the Bill is referred to the Unopposed Bills Committee.
On Question, Bill read 2a, and committed to the Committee on Unopposed Bills.

LONDON TRANSPORT (ADDITIONAL POWERS) BILL
Read 2a, and committed to the Committee on Unopposed Bills.

HOUSE OF COMMONS DISQUALIFICATION BILL [H.L.]
The LORD CHANCELLOR (Lord Elwyn-ones): My Lords, I beg to move that the Commons Amendments be now considered.
Moved, That the Commons Amendments be now considered.—(The Lord Chancellor.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[References are to Bill 136 as first printed for the Commons]
[No. 1.]
Schedule 1, pace 15, line 42, leave out ("28A of the Solicitors Act 1957") and insert ("45 of the Solicitors Act 1974".).
[No. 2.]
Schedule 3, page 24, line 19, at end insert—

(" 1974 c. 47.

The Solicitors Act 1974.

In section 90(4)(c), the words "paragraph 5 of Schedule 3 ".

In Schedule 3, paragraph 5.")

The LORD CHANCELLOR: My Lords, with the leave of the House, I beg to move that this House doth agree with the Commons in their Amendments Nos. 1 and 2 en bloc. Like the Bill which follows, it is a purely consolidation Bill. These Amendments reflect the coming into operation on 1st May of the Solicitors Act 1974. It is necessary to insert in this Bill references to that Act in place of the Solicitors Act 1957.
Moved, That this House doth agree with the Commons in the said Amendments.—(The Lord Chancellor.)
On Question, Motion agreed to.

NORTHERN IRELAND ASSEMBLY DISQUALIFICATION BILL [H.L.]
The LORD CHANCELLOR: My Lords, I beg to move that the Commons Amendments be now considered.
Moved, That the Commons Amendments be now considered.—(The Lord Chancellor.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[References are to Bill 137 as first printed for the Commons]
[No. 1] Schedule 1, page 6, leave out line 16.
[No. 2] Schedule 3, page 14, leave out lines 37 to 39.
The LORD CHANCELLOR: My Lords, with the leave of the House, I beg to move that this House doth agree with the Commons in their Amendments Nos. 1 and 2 en bloc. These Amendments reflect the abolition on May 1st of the Northern Ireland Community Relations Commission by the Community Relations (Amendment) (Northern Ireland) Order 1975. The Amendments delete the appropriate words.
Moved, That this House doth agree with the Commons in the said Amendments.—(The Lord Chancellor.)
On Question, Motion agreed to.

PRICES BILL
Read 3a, with the Amendments, and passed and returned to the Commons.

AIR TRAVEL RESERVE FUND BILL
The MINISTER of STATE, DEPARTMENT of INDUSTRY (Lord Beswick): My Lords, I beg to move that this Bill be read a second time. This Bill is concerned with the travel trade and in particular with people travelling abroad by air. It will affect a large number of people, for it is estimated that in 1973 United Kingdom residents made over 10 million visits abroad, of which some 70 per cent. used air travel.
Package tours originated in this country and have in large part been responsible for the phenomenal growth of post-war foreign holiday business. The development of larger aircraft made it possible. This possibility was exploited by enterprising travel firms making all the necessary arrangements and reducing costs further with long-term block booking of hotel accommodation and aircraft seats. This reduction in costs was helped by the method of payment, under which the tour operators receive the customers' money in advance, usually six or eight weeks in advance. This money is available for working capital, so that tour operators need to raise less capital at high interest rates. As a result of all these developments the number of Britons who went abroad on package tours rose from less than 60,000 in 1957 to over 3 million in 1973.

1155
But there were risks. Besides the sub-stantial forward commitments with hotels and aircraft there was expensive forward advertising and the need to reduce prices to the absolute minimum to meet competition. There was therefore a very limited safety margin. If a tour operator failed, holidaymakers who were already abroad might be stranded, and might even find themselves evicted from their hotels with no available return flight, Or those who had not yet departed would find their holiday cancelled, with only slim prospects of recovering their money.
So long as the international situation remained calm, the travel trade continued to expand, and these risks remained theoretical. But in 1974 the oil crisis, economic problems, and political difficulties in popular holiday resorts (like Portugal, Greece and Cyprus) all led to a marked fall in the number of summer bookings. As a result, five air travel organisers besides Clarksons, Horizon and Air Fair in the Court Line group, were unable to meet their commitments to the travelling public. Approaching 170,000 or 180,000 people all told lost all or part of their holidays or, having completed their holidays, had to be repatriated under special arrangements. The disappointment and distress this involved—not to mention the damage to our business reputation abroad —can be imagined.
The timing of these failures was significant. Most occurred at the height of the season, when the cashflow is at a maximum—the very time when failures had been considered least likely to occur. Moreover, they occurred at the time when other operators were stretched and when there was the minimum spare aircraft capacity available. In view of these circumstances, the travel trade's success in bringing everyone home was most impressive, and I should like to recognise the work in this connection. But having said that, the problem still remains.
In 1970 the Tour Operators Study Group introduced a system of bonding whereby each member was required to provide a bond, originally set at 5 per cent. of his annual turnover, which could be called upon if he ran into financial difficulties, and all members agreed to help with the repatriation of those abroad. Then from March 1972, all tour operator members of the Association of
1156
British Travel Agents were required to provide a similar bond, as a condition of membership. These arrangements worked satisfactorily when some small firms failed. But they had no statutory backing, and were not intended to cope with a major failure at the height of the season.
The Civil Aviation Act of 1971, provided powers for the licensing for air travel organisers as well as for the licensing of airlines. The consequent regulations—the Air Travel Organisers' Regulations of 1972—require the Civil Aviation Authority to be satisfied that an applicant for a licence is a fit person and has adequate financial arrangements for discharging his obligations. Under the regulations, the CAA extended the system of bonding; from May 1973—when licensing was introduced—all licence holders were required to provide a bond which was to protect passengers in the event of financial failure. These bonds were fixed at 5 per cent. of turnover for members of ABTA and 10 per cent. for others. This differential takes account of the assistance the Association is able to provide for its members if one of them finds himself in financial difficulties.
This level of bonding appeared reasonable at the beginning of 1974, but the subsequent events of the summer of 1974 showed that additional safeguards were necessary. It is perhaps fair to note that the bonds provided by the largest two of the companies which failed—Clarkson Holidays Limited and Halcyon Holidays Limited—were more than sufficient to pay for the repatriation of holidaymakers who were abroad at the time of the collapse; but the monies remaining from the bonds —although substantial—are insufficient to repay those holidaymakers who had paid in advance and had not departed. Hence the problem of how to provide adequate protection for holidaymakers and others against the financial failure of their air travel organisers still remains.
The Bill does three things. First, it will set up a new Air Travel Reserve Fund controlled by a new statutory body, the Air Travel Reserve Fund Agency. Secondly, it will empower the Civil Aviation Authority to collect contributions from air travel organisers and to pay these levies to the Agency. Thirdly, it will empower the Agency to manage the Fund and to make payments not only in

1157
respect of future losses but for those suffering from certain financial failures last year.
Clause 1 establishes the Agency, and the Reserve Fund. Members of the Agency will be appointed by the Secretary of State for Trade after consultation with the Civil Aviation Authority. The Bill does not specify how many members will constitute the Agency, but it is intended that it will include persons from the industry as well as representation of consumers and of the Civil Aviation Authority. The Chairman will be independent. The Secretary of State for Trade will have powers to give directions to the Agency on the management of the Fund and I have no doubt that he will keep closely in touch with its task at all times —as will the Civil Aviation Authority. If there are collapses involving a call upon the Fund, the Agency will be faced with intensive activity and may well have to engage professional services for short periods. Apart from this, I would not expect day-to-day work to call for permanent full-time staff.
Given improved economic conditions, I hope there will be very few, if any, calls upon the Fund. We do not want the Fund to outgrow or outlive its useful functions. This can be avoided by reducing contributions levied from licensed operators under Clause 4—or even by winding up the Fund under Clause 6 if, for example, some new and wider scheme should subsequently be introduced. The Agency will be financed by the air travel industry. This aspect also is dealt with in Clause 4, so I will deal with that now, and will return to Clauses 2 and 3 later.
My Lords, I should emphasise that I am using the term "air travel organiser" in the sense of a person required to hold a licence under Statutory Instrument 223/1972. With certain exceptions, an air travel organiser is a person who charters seats from an airline and offers them to the public. All such air travel organisers must hold a licence from the Civil Aviation Authority, who may stipulate conditions for holding a licence. I have already referred to one of the existing conditions; namely, the requirement to provide a bond.
Clause 4 will empower the Secretary of State to make regulations after consultation with the Authority, and subject to
1158
Affirmative Resolution of both Houses, to require as a fresh condition of obtaining or holding a licence that an air travel organiser shall pay a contribution to the Fund. This contribution will be a percentage of the relevant business of the air travel organiser in question. It will be paid in advance, and will be based on an estimate of the expected turn-over. Provision is therefore also made for the contribution to be corrected up-wards or downwards when the actual turnover is known. Our present intentions are that the contributions will normally be paid twice yearly, in April and October. The Authority is already making the necessary preparations for the introduction of the new system, subject, of course, to passage of the Bill. The first contributions will be collected after an Order has been approved by both Houses of Parliament. I hope this will be possible within a few weeks of Royal Assent.
These initial contributions are likely to be at a rate of 1 per cent. and to be increased to 2 per cent. from April 1976. These proposed rates take into account the effect on the travel trade of the higher bonding required by the Civil Aviation Authority and the need to give travel organisers time to recover from the difficulties they experienced last year. The initial rate of 1 per cent. should give the industry some time to make the necessary preparations. But the higher rate will become payable in respect of the first full summer season after the passing of this Bill.
None the less, it will take some time for the Fund to be built up. Since it must be in a position to cope from the start with major collapses where the bonds are inadequate, and since there is also the need to provide for last year's victims, it is intended that the Government should help the Fund off to a reasonable start. Clause 5 of the Bill permits the Secretary of State to lend to the Agency from public funds up to a limit of £15 million. It is expected that, by September 1977, the levy contributions should have built the Fund up to an adequate level and no further loans will be permitted. After an initial breathing space, we shall seek repayment, and it is expected that this will begin in October 1976.

1159
The greater majority of passengers travelling on charter aircraft overseas, or on a so-called "part charier" on a scheduled service will be covered. There will be a small minority of people travelling on a package tour who will not be covered, because the type of tour does not require a regulatory licence and the special protection which goes with it. But these are a minority. A significant number of travellers will also benefit who are travelling independently—for example, those who are travelling on Advance Booking Charters—because their journey has been covered by the protective system of licensing and bonding. Clause 2 of the Bill describes all these people who will be covered by the Bill.
I have tried to describe in very broad terms who will be protected by the Bill. In any particular case the losses and liabilities they have suffered will be affected by the exact contractual arrangements which are varied and adapted to meet changing conditions. It has been crucial to the trade's development of new types of contract, and fares have constantly been developed. We do not want to introduce unnecessary rigidities, but there clearly must be some precision so that the trade and customers can see where they stand. This precision will be given in the benefit rules to be prepared under Clause 3 by the Civil Aviation Authority, subject to the approval of the Secretary of State.
Finally, I turn to those who were affected by the failures which occurred from 1st April 1974 and before the publication of the Bill. I emphasise that many of these were, in fact, looked after under the bonding arrangements current at the time and were able to complete their holidays. Even in the case of Clarksons and Horizon this was so. The bonds were called up to finance an extremely successful repatriation operation. Substantial sums still remain in these bonds and must be paid out before the Agency can step in under Clause 2. We are already holding discussions with the holders of the bond monies, and the liquidators of the companies concerned, concerning the arrangements for identifying and verifying outstanding claims with all possible speed. That is the position with regard to the past. The future will
1160
depend upon this Bill being passed. I am pleased to move that it now be given a Second Reading.
Moved, That the Bill be now read 2a. —(Lord Beswick.)
Lord BALFOUR or INCHRYE: My Lords, before the noble Lord sits down, may I ask him to clarify one remark he made? In speaking of the difficulties of tour operators, he used the words, "You will see, therefore, there was very little margin for safety". I am sure, and I know that your Lordships' House as a whole will realise, that the Minister was referring to economic factors; but as we are dealing with aviation we do not want any misunderstandings to arise outside. Would the Minister be good enough just to make it clear that there is no question of air safety here, and that he was talking about economic safety?
Lord BESWICK: My Lords, I am grateful to the noble Lord. Of course, I was speaking of the financial side and not at all of the air safety side.
3.3 p.m.
Lord BELSTEAD: My Lords, I should like to thank the noble Lord for his clear explanation of the terms of this Bill, which establishes a statutory fund to be financed by compulsory levies on air travel organisers in order to guarantee any losses or liabilities incurred by customers in the future, and to repay those who suffered losses last year. Of course it is a fact, as the noble Lord explained, that last year some five air travel organisers besides the Court Line Group failed, and I believe I am right in saying that more than 170,000 people lost all or part of their holidays in circumstances which caused disappointment and, in some cases, considerable distress.
Particularly because, as the noble Lord explained, there has been such a rapid increase in package holidays, every effort clearly has to be made to ensure that a situation of this sort does not recur. But at a time when this House stands only just over a week away from the Second Reading of the Government's forthcoming Policyholders' Protection Bill—a Bill under which the Government will specifically exclude any idea of retrospective help to policyholders in Nation Life—I am surprised that the House is being asked

1161
in this Bill to approve retrospective payments to last year's holidaymakers, without any explanation of this apparent contradiction.
It may be fair to claim that the reason is not very hard to find. On 26th June last year, the Secretary of State for Industry made a Statement in another place about the Government's readiness to acquire Court Line's shipbuilding interests, and in that Statement he volunteered the information:
"that this should stabilise the situation in respect of Court Line's interests, including the holidays booked for this summer."—[Official Report, Commons, 26/6/74; col. 1557.]
He went on to amplify and confirm that assurance. Without a shadow of doubt, on this assurance from the right honourable gentleman many thousands of people went ahead with their holiday plans, and many completely lost their holidays. In the circumstances, I can well understand— and I do not in any way quarrel with this—that the Government have an obligation to those who lost their holidays last year, but I think it is an obligation which should be discharged by the Government and not by future travellers. I think this is a reason for a fundamental criticism of this Bill.
The safeguarding of customers in the future is quite another matter. This is something which members of the Tour Operators' Study Group have tried to ensure since they started the idea of voluntary bonding in 1970. It is really the reason for the issue of air travel organisers' licences by the Civil Aviation Authority, and there need be no difference of opinion between either side of the House on this issue, provided the arrangements to give the necessary guarantees are as fair and economical as possible.
Regrettably, I do not think this is achieved by this Bill, which I find on reading to be both inflexible and burden-some. It is inflexible because the Bill disregards any alternative arrangements which the tour operators might want to make; for example, through insurance. It is burdensome because it provides for travel organisers to pay the levy in the first instance. This, in turn, will have to be passed on to the customer and all this will apparently be supported by a Government loan which we are assured will be up to £15 million, interest free. The Bill will, therefore, be a burden on the
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firm's customers and on public expenditure; and in our present economic climate I do not think this is warranted.
Now that the Bill has passed through another place, I hope the Government appreciate what an appreciable burden the levies will impose on the travel trade. It is this three-pronged burden to which I particularly want to draw attention. The Government have made it clear that the regulations to be made under Clause 4 of this Bill will provide for contributions to the Fund twice-yearly in advance. I believe the noble Lord said that, first of all, it would be 1 per cent. of the expected turnover, increasing to 2 per cent. from April next year. These payments will be on top of the cost of the licence and of the bonding arrangements.
As an air travel organiser's bond has now been increased from 5 per cent. to 10 per cent. of turnover, the cumulative effect of these cash payments will really be very heavy indeed. For example, for some firms the commitment to this new Fund will add tens of thousands, and even hundreds of thousands, of pounds to their immediate necessary cash payments. As the levies are to be paid in advance of any hope of being able to recover the money, these payments will amount to a very substantial tax on our travel organisers which they will not be able to avoid passing on to their customers. Perhaps when the noble Lord comes to reply, he could tell the House by how much the price of holidays will increase because of this Bill. Doubtless the amount will not be insignificant.
Despite repeated warnings, I do not believe that the Government have appreciated the danger of piling increasing burdens upon the cash flow of companies, and I am certainly not satisfied that they have explored the possibility of encouraging firms which might want to do so to guarantee their services through another method—perhaps through insurance. In another place figures were given which showed that to insure travellers against failure of the company to provide the services paid for would amount to about one-third of the cost of this year's levy; that is, before the rate of the levy is doubled next April. Most desirably, insurance would be for a specific holiday, as distinct from the levy, which will be a general tax paid in advance, as I have said.

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Insurance, I think, would also overcome what I find a most undesirable feature of this Bill; namely, the requirement for prudent management to pay subsidies to guarantee the operations of other people. Alternatively, it is perhaps just conceivable that the bonding arrangements might now be sufficient guarantee. The noble Lord spoke about this matter at some length and I listened with interest. But the point I want to put to the Government is that, when the Bill was introduced earlier this year, I certainly would not have suggested this, but now not only has the cost of the bond been doubled as from a year ago but I see from The Times of April 2 that, on that date, over 100 air travel organisers' licences had not been renewed by the CAA; and although I understand that subsequently this number has been considerably reduced, and all members of the Association of British Travel Agents are now licensed, I note The Times also reported that it was understood that there were now tougher bonding requirements being applied by the CAA. This presumably would lead one to the conclusion that the bonding requirements, both financial and mechanical, are much more satisfactory or at least much more stringent than they have been in the past. Those are just two possible alternatives: relying on the bonding or at least allowing an option of insurance.
When the noble Lord comes to reply, perhaps he can give us some figures in support of the case for the Bill. For instance, has an estimate been made of the shortfall of a bond in the event of a company failing at the height of the holiday season? I suppose the answer is that it is estimated that the 1 per cent. or 2 per cent. levy would take care of this, supported initially by the Government's £15 million loan. But are the Government sure that the levy needs to be stepped up in this way? On the face of it, I should have assumed that the levy could taper as the Fund accumulates. What is to be the division of the Government loan of £15 million as between last year's holidaymakers and an amount to be kept in reserve against any future emergency? Again, I realise that this is not easy to assess because, as the noble Lord has said, the liquidators have not yet finished their work. But on Second
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Reading in another place the Secretary of State for Trade said that much careful thought—those were his words—had been given to fixing the amount of the Government loan. So presumably there must have been some assessment of the likely level of retrospective claims from last year.
I ask these questions because the House needs to be satisfied that the Bill is necessary and that the level of expense is justified. It is a sad reflection of present-day inflation that this Fund is really nothing more than a duplication of the financial arrangements of the bonding system. I cannot honestly call that a very imaginative approach to meeting the risks of charter travel, but if it is to be done in this way then let us ensure that it will be done as fairly and as economically as possible.
In another place—I did not hear the noble Lord say it this afternoon—the Government gave the view that this Bill provides a measure of consumer protection: they actually used those words. When the noble Lord is replying perhaps he could explain to the House the Governmenfs policy on reserve funds of this kind. By tomorrow week this House is to have had two such funds proposed to it, this one and the proposed Insurance Fund. Is this line of policy to be extended indefinitely? If it is, it will encourage irresponsibility in some cases. It is absolutely bound to raise costs. What I find most worrying is that, far from protecting consumers, as a policy it will remove from consumers any choice of how best to protect their interests, not only most effectively but also most economically. When the noble Lord referred to Clause 6—the winding-up clause—of this Bill, he said that it might be needed if some new or wider scheme were to be introduced. I rather quailed when I heard those words. I hope that this Fund will be at least buoyant within the next few years, and it will be for that reason that the Fund can eventually be wound up or alternative arrangements thought of.
In conclusion, my Lords, if the Government feel they have an obligation to those who booked holidays last year— and on the evidence I think there is such obligation—then the Government should make a grant and explain to Parliament the reason for this. But as to the future,

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this Fund is a very expensive way of providing the necessary guarantee. From this side of the House I certainly agree that there must be a guarantee that what happened last year never occurs again. In providing this guarantee, there are ways in which the commitment to the Fund could be alleviated, and the House will wish to explore some of those ways when we reach the next stage of the Bill.
3.16 p.m.
Earl AMHERST: My Lords, I should like to join the noble Lord, Lord Belstead, in thanking the noble Lord, Lord Beswick, for taking us through this Bill, and I further thank him for his exposition of the history of this inclusive tour business, both its ups and its downs. He has explained that the Bill provides for an agency to be called the Travel Reserve Fund Agency to be set up under the ægis of the Civil Aviation Authority. It is to be a statutory body empowered to collect and administer funds to reimburse travellers who incur liabilities and losses through the default of an inclusive tour organiser with whom they have booked, if such liabilities and losses are more than can be met by the existing bonding arrangements required by the Civil Aviation Authority when they grant the licences. In the first instance, this Fund is to come from a levy to be made on the tour organisers commensurate with the volume of their turnover. This will at once be passed on to the customer when he pays for his ticket. I am told that it is likely to work out at an additional cost to the traveller of possibly 1 per cent. up until April 1976, and there-after 2 per cent. Should this Fund be insufficient to meet the full liabilities the Agency is to be able to borrow from the Government amounts up to an aggregate of £15 million sterling free of interest.
We on these Benches welcome any effective measures that will give to the travelling public as much protection as possible against losses and miseries as so many of those people suffered with the Court Line failure. So at first sight we will give a cautious welcome to the Bill as it now stands. But there are some aspects both of detail and possibly of policy attaching to the Bill in its present form with which we are not at all happy.
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We note that Government loan is to be obtainable only up to 30th September 1977, when indeed the Agency itself can be wound up. If by that time it is found that the Agency is in credit, what happens to the balance? Is it to be funded to the Treasury, the tour organisers, or the customers? If the Agency is to be continued, will it be on the same terms with the possibility of an interest-free Government loan, and for how long? If it is to be wound up, do the Government contemplate that the travel business will by that time have reached such a Utopian state that further protection of the customer is no longer necessary? If that is Government thinking, what kind of crystal ball are they using?
As I read it, those unfortunate people who suffered heavy losses and liabilities in the Court Line disaster, and who are still without compensation, are to be taken care of out of this special Fund, but, if that is insufficient, from the Government loan. This point was stressed very much by the noble Lord, Lord Belstead. Does this not mean in effect a retrospective tax to be levied on this year's passengers and possibly next year's passengers as well, and if there is not enough, on the taxpayer? I understand there is some urgency to get this Bill on the Statute Book in time for this summer's holiday traffic. Even so, I believe that two Government inquiries are being held one of which is expected to pronounce whether or not the victims of the Court Line affair were misled by any Government statements. If the answer is "Yes, they were", should not the Government be responsible for their own mistakes and cover the position by possibly a grant-in-aid or something of the kind, rather than seek to do so by imposing retrospective taxes on future passengers? Should there not be some provision in the Bill to meet such contingencies as may arise from the findings of these inquiries?
In some tour arrangements there is an element to cover the cost of hotels and accommodation abroad. In providing cover for the kind of liabilities we are now talking about, should there not be provision in the Bill to ensure that no part of public funds is used to compensate foreign hoteliers? Surely it is not our responsibility or our business to cover such people against commercial risks that they themselves choose to take.

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It would hardly be realistic to assume that all tour organisers are models of rectitude. Should there not be some provision in the Bill to deal with those unscrupulous ones who are running up a big list of liabilities, producing some rigged statements of accounts and absconding abroad with the money and possibly a couple of Rolls-Royces, leaving the customer in the lurch and the Treasury to pick up the pieces? Clause 3 provides for the Civil Aviation Authority to make rules in respect of payments from this Fund and the circumstances in which it is held that the tour organiser is unable to meet his financial commitments. Could it not rescale the bonding arrangements to a point where they could cover these liabilities?
Clause 6 enables the Secretary of State to give direction to the Agency in regard to its functions—if I may say so, just about as wide a provision as could be. It seems in this connection to give the Secretary of State full veto and direction over both the Agency and the Civil Aviation Authority. Does this indicate that if the loan and the Agency itself is to be wound up in 1977, possibly at the instance of the Secretary of State who has the power to do so, the way is then paved for the Secretary of State, if the present incumbent is still there at that time, to nationalise the lot?
While reiterating that we on these Benches are anxious to support all possible measures to give protection to the travelling public, we ask whether it is really necessary to set up this new Agency —yet another statutory body, another bureaucratic entity—if only on a temporary basis and even if only a very small staff is contemplated. Is there anything that this Agency is set up to do that cannot equally well be done by the Civil Aviation Authority? I know that I have asked a great many questions. Just how many Amendments we may be putting forward from these Benches at the Committee stage of this Bill will depend upon how the noble Lord who is to reply is able to answer my questions.
3.22 p.m.
Lord DAVIES of LEEK: My Lords, I am grateful to my noble friend Lord Beswick for introducing the Second Reading. I ought to declare an interest
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because one young member of my family lost about £60 on a tour. Therefore, I have a little interest in the matter, in that I had to subsidise him in order that he could get his holiday. He got it and enjoyed it!
I ought to make one point clear. Like most noble Lords, I have hopped around the world on my own. Only once have I ever gone on a package tour. My wife and I went on this tour and I want to pay tribute to the fact that it was one of the best organised tours I have ever been on in my life. It was to Jugoslavia. For the money which I spent, the hotel food was marvellous. Had I travelled on my own, the cost of my air fare would have been nearly twice the cost of my stay in Jugoslavia. Therefore, when we are discussing this point, do not let us think that there has been an organised racket to milk the new millions who have started touring the world. The truth is that but for these organised, conducted tours in foreign lands, where there is lack of knowledge of the language of those countries, millions of people would not have enjoyed an expansion of their knowledge and a better understanding of foreign countries.
Having said that, I will now deal with a few biting points. I have read with care the minutes of the Committee stage, and I am tired to death by it all. In his dulcet tones, the noble Lord, Lord Belstead, reminds me sometimes of Spenser's Faery Queene—beautifully enunciated but with a waspish sting underneath. He has asked whether the Government could not do anything better. This is a bit of propaganda. In Committee upstairs, 11 columns of Hansard were taken up with a discussion about on which day they should sit, and how many days a week—Tuesdays and Thursdays. Believe you me, my Lords, if you want to enjoy yourselves read the load of rubbish in those 11 columns. It was nothing but propaganda denouncing some Minister who allegedly had let the world understand that Court Line was absolutely sound financially. Nothing could be further from the truth. Of course, most noble Lords do not bother to distinguish between supposition, fact and truth, the three legs to the stool of society which should be kept firm.
I wish that the noble and learned Lord, Lord Hailsham of Saint Marylebone, was

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here. On Saturday I listened on my car radio to a philosophical dissertation of his on reality and knowledge. I wish that when he is dealing with this side of the House the noble and learned Lord would sometimes apply his succinct mind to the elimination of some of the propaganda. Therefore, I take very little notice of the noble Lord who spoke from the other side and popped in his little bit of propaganda, because one of the great sayings of the week, bless him, if he is now looking over the ramparts of Heaven, is culled from the late honourable Member of another place, Sir Gerald Nabarro. After he had frightened the whole of the British population, just as some people are trying to frighten it now, about travel tours and taxes on cars going up, at the end of the day he said, "I am a propagandist, and when one is propagating views and ideas one does not determine too closely what is fact and what is supposition". Of course, we get plenty of this.
The noble Earl who has just sat down made many constructive points and I hope sincerely that some of these will be dealt with at Committee stage. This Bill aims at giving greater security to holiday-makers. Also, it aims at helping holidaymakers who lost money. The advancement of the air tours industry is shown by the figures which have been given by the noble Lord. I will not repeat them, but the number of tour operators has vastly increased above the 57,000 who were licensed in 1957. In 1974, and in the world in which we are now living, conditions have changed. Often it seems to me that the keen knife edge of competition in this aspect of tourism placed many companies in jeopardy, in their endeavour to give a fair deal to people who had never before travelled overseas. In some cases, they cut their profit per tour to the bone in the hope that the numbers would make up the profit. I pay tribute to some of those firms who struggled to do that. The Edwards Report on Civil Air Transport recognised the ultra-competitiveness of this kind of tourism.
I think that in this connection a caveat or warning from the Government was necessary. It is no good twitting this side of the House for not having done anything earlier and for lack of imagination. During their period of power when tourism was at its peak, what did the
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Conservative Government do in this direction? The answer is nothing. I am not clear about one important point which was made by the noble Earl who spoke from the Liberal Benches. The point appears in the introduction to Clause 1. I am not clear about how consumer representation is to be included. I know that this was promised upstairs in Committee. Will there be consumer representation on the Travel Reserve Fund Agency? What powers, if any, through a representative or representatives, will the man in the street have?
There is no need to cover ground that has already been covered, and I do not know whether this comes within the purview of the Bill; but, finally, in these days of highfalutin' advertising propaganda I think there is need to protect the unsuspecting public from the kinds of paradise that are sometimes printed or shown on television. For instance, while I have not been in Honolulu for 20 or more years, if you offered me a free holiday in Honolulu I would probably take it. A noble Lord may want to do that; but I think I would prefer a fort-night on the mountains of Wales to a fortnight in Honolulu.
Several Noble Lords: Hear, hear!
Lord DAVIES of LEEK: Thank you for that, my Lords! Due to the fact that the technological cacophonous age in which we are living is filling the whole earth with noise and with crowds of people who seem to lack that grace, neighbourliness and courtesy which is necessary to live in a civilised manner, I hope that while the taxpayer and the Government are willing to risk this money there will be some limit on the type of propaganda or advertising that goes out from these organisations to encourage people to make these trips.
If I said any more I should merely be reiterating what people have already said in Committee in another place and what others are going to say. Also I notice that I have spoken for nine minutes, and that is quite long enough.
3.32 p.m.
Viscount MONCK: My Lords, it is always difficult for a simple Sassenach to follow after the inspiring and musical Welsh hwyl of the noble Lord, Lord Davies of Leek, but I will do my best.

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When any of these tragic circumstances have occurred, either that people have paid for their holidays and then there are no holidays, or perhaps, worse still, they find themselves stranded in a foreign country with no means of getting out and the hotel bills going up and up, I have always said to myself one of two things: either "There but for the grace of Cod go I", or alternatively, "I really think they could have investigated the position more carefully before booking". Particularly as public money will be concerned—we see that under Clause 5 it may be lent, but I expect it goes a little further than that—I was anxious to find out in this Bill what protection there will be for those who want to be sure of being safe when they are making a booking.
I find in Clause 2(4) and (5) that no compensation will be paid unless the air travel organiser holds an air travel organiser's licence. So far so good. But what has one to do to get an air travel organiser's licence? By courtesy of the Civil Aviation Authority, I have here, as your Lordships will see, a fair wad of paper which is the application that a firm has to make in order to obtain this licence. In this section 5 was what really made me happier: that the firm or the applicant should send with this application a copy of his last three Annual Reports and Statutory Accounts. With that I felt considerably happier, because it infers that somebody will need to have a bit of background.
There is one aspect of this form with which I do not agree. In Section 1 of the application, paragraph 6 on the front page is headed "Personal contact". I make this observation in the hope that my noble friend who is chairman of the Authority and who is not only a noble friend but a very long-standing friend, will not sever that friendship because I am criticising one of his documents. It says there:
"As the Authority may wish to ask you further questions or to discuss matters arising from your application, please state here the names and telephone and extension numbers of suitable contacts within your organisation."
My Lords, 43 years in business have taught me to shun the telephone like a mad dog for anything that has to do with an agreement. It must be in writing and
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I hope very much that the Civil Aviation Authority will slightly tone down that Section 1(6).
I do not like retrospective legislation. Here I agree with my noble friend Lord Belstead. On the other hand, at the risk of his being cross with me—and I think any anger that I may arouse in him can easily be dispelled within ten minutes at the Bishops' bar—I am going to commend this Bill to your Lordships because I think it is right and proper to do so. However, I want to ask the noble Lord, Lord Beswick, a question. Today, a great deal of information comes out and so many new laws and rules are made which it is very difficult to get across to the general public. I ask that every possible effort should be made to bring home to the general public, if and when this Bill becomes an Act, that on no account should they book on any tour or voyage without making absolutely certain that the firm or the individual with whom they are booking holds an air travel organiser's licence.
3.37 p.m.
Lord BESWICK: My Lords, I should very much like to thank the noble Viscount, Lord Monck, and say that I agree with him absolutely that the general public should themselves feel a responsibility, but they should be given every assistance to discharge that responsibility to deal with and travel with a reputable concern. The trade and the Civil Aviation Authority are already doing a good deal to make it possible to do just this. I understand that the Civil Aviation Authority already issues lists of licensed air travel organisers through the Association to all its retail members, and we are doing all we can to persuade the non-licensed travel agents to get themselves on the Civil Aviation Authority's circulation lists. These lists will be available at all local trading standards offices and through the Citizens' Advice Bureaux, and of course a telephone call to the Civil Aviation Authority will provide the answer on the spot. That is being done to enable the potential traveller to see where he can most confidently go with his business, and he should be encouraged to take precautions.
However, having said that let us recognise the fact that we are here dealing with a business which went through what was in many ways an unhealthy period of growth, and it really is not

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good enough, as my noble friend Lord Davies of Leek said, for the noble Lord, Lord Belstead, to be quite so superior about this and to criticise the present Government. These troubles developed in an era of the printing press as operated by the previous Administration. It was in that atmosphere of false affluence, when everybody thought everything was all right and then found it was not, that troubles followed one after the other. Let us not forget that we are trying to mop up a situation which was rather the result of over-expansion.
The noble Lord, Lord Belstead, said that he was proposing to table some Amendments and the noble Earl, Lord Amherst, also said that he may have some Amendments to offer. Maybe some of the points raised would better be dealt with on the narrower subjects when the Amendments have been put down on the Order Paper. I will do my best to answer the Questions raised.
My Lords, first of all let me tell the noble Lord, Lord Belslead, that we are in fact dealing here with the Air Travel Reserve Fund Bill, and not another piece of legislation which is coming up next week and which the noble Lord was disposed to criticise. No doubt he will repeat his criticism then. I will certainly reserve my answers until then. The noble Lord asked me about the need for the loan and what was the shortfall of the bonding. My information is that the possible liability outstanding is between £7 million and £8 million, and there is about £2,500,000 in the kitty left over from the bonding arrangement. So, as of now, there is need for an initial support.
The noble Lord, Lord Belstead, advanced two contradictory lines of argument. On the one hand he was saying that the proposed levy would be a burden upon the industry, while on the other hand he was criticising us for making available this £15 million loan. The idea is that there would be a period of time when unforeseen liabilities would be backed up by this Governmental loan. But at the same time we recognise that there is a financial difficulty facing some of the companies, and therefore the levy was fixed initially at 1 per cent. The levy then goes up to 2 per cent. when the companies have had a greater opportunity of making the necessary financial
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arrangements. The noble Lord said that he expected it to taper off rather than build up. I should expect it to be increased initially whilst the industry is making its financial arrangements and that subsequently, provided that we have no more trouble, it should then be expected to taper off. I absolutely agree with the noble Lord that it should, and I hope that this is what will happen.
My Lords, part of the argument of the noble Lord, Lord Belstead, has been that in any case the Government should not come into this matter; it should be left to the industry. I agree with the noble Lord that it ought not to be necessary for the Government to come into it. I have no knowledge of any of my colleagues who wanted to come into it, but we are faced with a situation where the industry itself did not make the necessary provision. The industry made some provision with this bonding arrangement, but it was not adequate in the special circumstances. As I see the arrangements, they give us time to get the industry properly, soundly, and healthily organised. The bonding system is the first bulwark of defence. However, in my personal view, best of all is the expertise which the Civil Aviation Authority will acquire, build up and gradually apply to the licensing arrangements. I hope that in the future we shall have an industry in which there are only reliable and reputable operators, in whom we can all have trust. When that time arives, when it is seen to be arriving, when the reserve fund is tapering off, then the situation will arise to which the noble Lord, Lord Belstead, looks forward. I share his expectations.
I was asked what would be the effect on the cost of holidays. Of course there will be a cost; there is bound to be. The cost is expected to be of the order of 2 per cent., but I am rather inclined to the view that it would be better to have an extra 2 per cent. on cost at this point rather than have the miserable start we have seen in the last year or two. If we can give the necessary security for 2 per cent. it will not be too bad.
I was asked by the noble Earl, Lord Amherst, whether the foreign hotelier will be compensated. The answer is that he will not. This will be made clear in the rules that will be published. I was asked what would happen to the Fund

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when and if it eventually has to be distributed. My information does not reach quite so far ahead, but I agree that it is something to which we shall give a little more thought. I think I can say a little more on this point in the other stages of the Bill, and I shall be very happy to do that.
A question was raised about the responsibility of my right honourable friend in the case of the Court Line business. If I may say so in all friendliness to the noble Lord, Lord Belstead, I thought he made rather heavy weather of this. If it be said that some people took out a holiday because they thought there was the imprint of a guarantee from my right honourable friend, it is not beyond the bounds of possibility, but I do not think it can be shown to be the case. If his words are studied I should not have thought there would be any question at all of his accepting responsibility for the losses of these foreign travellers. My right honourable friend was talking, and was known to be talking, about a completely different sphere of activity of that particular company. In any case, an inquiry under Section 165 of the Companies Act is now being carried out. There is also an inquiry by the Parliamentary Commissioner. I should have thought we could safely leave that particular matter to those inquirers. I think that answers the questions, but if it does not I promise I will faithfully return to them when we come to the Committee stage. In the meantime, I hope it will be found possible, in accordance with what has been said, to give this Bill a Second Reading.
Lord HAWKE: My Lords, could the noble Lord, Lord Beswick, answer a point that is worrying me and which I think was not raised at all? What discipline will there be on those air travel organisers who do not organise their business in a prudent manner? One knows that the ambitions of young men sometimes overrun their discretion. What discipline will there be?
Lord BESWICK: My Lords, with great respect I tried to answer that point when speaking about the development of expertise on the part of the Civil Aviation Authority, who will not issue a licence to an operator unless they are satisfied that
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that operator has prudence, to use the fine old Victorian word used by the noble Lord, Lord Hawke. The operator will have to provide a bond. He will now have to provide this levy. I should have thought that they would be financial sanctions. They will have to provide a financial guarantee in advance—and here i am dealing with a point made by the noble Lord, Lord Belstead, who said, in tones of great criticism, that the operators had to provide this money in advance —as it would not be any use going to them when they were broke and asking them to provide a levy. They will have to give the money in advance. I should think that would be the sort of discipline that the noble Lord, Lord Hawke, and myself would wish to see.
Lord DAVIES of LEEK: My Lords, before the noble Lord sits down, I think I may have missed something. I asked a question on Clause 1 about the interests of the travelling public. If the noble Lord, Lord Beswick, is too busy to answer now, we can come to it in Committee, but it is important.
Lord BESWICK: My Lords, I made a note of that and intended to answer the noble Lord, Lord Davies of Leek. I am sorry I did not. In the first place, I look upon this Bill as being in the interests of the consumer. The whole purpose of the Bill is to protect the consumer. It is consumer-orientated. On the Agency there will be a representative of consumer views.
On Question. Bill read 2a, and committed to a Committee of the Whole House.

LITIGANTS IN PERSON (COSTS AND EXPENSES) BILL
Brought from the Commons; read la, and to be printed.

INTERNATIONAL ROAD HAULAGE PERMITS BILL
3.50 p.m.
Lord CHAMPION: My Lords, I beg to move that this Bill be now read a second time. It is a fairly simple Bill made necessary by an abuse of the permit system under which road hauliers are allowed to operate in foreign countries.

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Perhaps I ought to explain that there are three sets of circumstances in which lorries may enter foreign countries. The first is the preferable one of the three, and that is the one in which there are bilateral agreements which put no obstacle to British lorries entering the countries concerned. This is, of course, the desirable situation, and one towards which the Community countries must work if we are to eliminate barriers to trade. Indeed, I hope that the Community will eventually eliminate the permit system altogether, retaining only an internationally accepted common operators' authorisation and standard of vehicle maintenance.
The second circumstance is one under which some countries insist on British lorries carrying permits issued within an annual quota. The number of permits issued under these bilateral arrangements is a matter for agreement between the British Government and the countries concerned. At the present time these countries are three, France, West Germany and Italy. Despite the efforts of our Minister of Transport, the number of such permits is well below the requirements of the United Kingdom hauliers.
The third circumstance relates to multi-lateral journeys, and these are permitted under Regulations of the Community and a Resolution of the Council of Transport Ministers. Under these Regulations and arrangements, the number of multilateral permits is also limited and may well be below the requirements of the British hauliers.
The fact that there is a limit on the number of permits available to British hauliers has led to a widespread use of forged permits, and this has been the cause of at least one foreign country taking action to check the entry of British vehicles. This causes delays to vehicles entering a country on genuine permits, resulting in honest road hauliers suffering for the activities of those who use the forged permits. It is well known that a traffic in forged permits has developed and it continues to grow. Foreign Governments are also aware of this, and it is important that we should stamp, and stamp hard, on the practice. Any failure by us to do just that would be used by restrictive countries as an argument for resisting quota increases. The haulage associations are also concerned that these
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malpractices should be properly dealt with, since honest hauliers are losing trade to those who are prepared to indulge in dishonest practices.
The Bill is necessitated by the fact that there are loopholes in the existing law through which forgers of permits and others are able to escape. The situation is that successful prosecutions have been brought under the Forgery Act 1913 against several persons for printing, uttering and conspiracy in connection with forged permits, but it was suggested that they might appeal on the grounds that, to be convicted of forging, uttering or conspiracy under the Act of 1913, it must be shown that there was intent to defraud, and that can be established in this context only if the intention was to deceive an official within the United King dom who had the right to require production of the permits. Although international agreements normally cover production of permits on demand to duly authorised officials, in the absence of specific provisions in United Kingdom law as to who these officials are and the extent of their powers, this part of the agreement could, in practice, apply only in the foreign countries concerned. There was also the related difficulty of establishing whether permits had been forged in the absence of a power to require production by the driver. The Bill is designed to strengthen and extend existing legislation, so as to enable effective action to be taken against any persons involved in the use of forged permits.
The Bill is a comparatively short one. It has one main clause and two consequential clauses relating to the necessary changes in the transport legislation of Great Britain and of Northern Ireland. Clause 1(1) gives power to the Secretary of State to make regulations by statutory instrument, specifying the conditions in which a United Kingdom goods vehicle, including an unaccompanied trailer, must not be used unless a permit of a type specified is carried on the vehicle or, in the case of a trailer, by the person in charge of it.
Subsection (2) empowers examiners— as defined in subsection (9)—to require production of the permit, if it appears to them that one is necessary by virtue of regulations made under subsection (1). Examiners are also given power to detain

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the vehicle concerned long enough to inspect and copy the permit, and power to enter premises in which they believe that either there is a vehicle which is being used on a journey to which these regulations apply or permits of a type specified in the regulations are to be found. Subsection (3) provides for a maximum penalty of £200 in the case of any person convicted of using a vehicle in contravention of regulations made under subsection (1). Subsection (4) provides for a maximum penalty of £100 in the case of conviction of the driver or other person in charge of a vehicle or trailer for failing to comply with a requirement under subsection (2) to produce a necessary permit or for obstructing an examiner in the exercise of his powers under that subsection. Sub-section (5) prescribes the penalty for wilfully obstructing an examiner.
Subsection (6) provides that a motor vehicle shall be presumed to be registered in the United Kingdom if it has exhibited on it a licence or trade plates issued under the Vehicles (Excise) Act 1971 or the Vehicles (Excise) Act (Northern Ireland) 1972 or preceding enactments. Subsection (7) requires the Secretary of State to consult representative organisations before making regulations under subsection (1) and makes such regulations subject to the Negative Resolution procedure in both Houses of Parliament. Subsection (8), in effect, applies to this section the interpretation of the person "using" a vehicle which is given in Section 92(2) of the Transport Act 1968 and Section 46(b) of the Transport Act (Northern Ireland) 1967. Subsection (9) defines certain terms used throughout the Bill.
Clauses 2 and 3 make provision for the consequential Amendments to the Transport Act 1968, the Road Traffic Act 1972 and the Transport Act (Northern Ireland) 1967. My Lords, this is, I think, a useful little Bill which the Department and I certainly hope will block a loop-hole, and I hope that your Lordships will accept it and give it a Second Reading. I beg to move.
Moved, that the Bill be now read 2a. —(Lord Champion.)
4.0 p.m.
Lord MOWBRAY and STOURTON: My Lords, I think that I can speak not
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only for this side of the House but probably for the whole House in saying how grateful we are to the noble Lord, Lord Champion, for the explanation he has given to this, as he says, simple but worthy little Bill. I was glad to hear the noble Lord express the hope that, in the ideal world, permits would not be needed to convey transport around the world, but we are not in an ideal world. In the circumstances of the Minister in the Department of the Environment concerned having to try to fight for more permits for our haulage associations—the Road Haulage Association, the Freight Transport Association, not to mention the National Freight Corporation—it is stupid that we do not do something to try to stop these permits being forged, because it is in the interests of the legal operators (who are the legitimate operators, and are the carriers of the best trade) to be protected.
I query only whether the fines are heavy enough at £100, £200. A heavy lorry can carry a lot of goods worth a great deal of money. There is nothing in this Bill about confiscation of such a load. The chances are that you either keep the load in Britain and the money is yours, and you pay £100 or £200, or you get through and the world is your oyster when you get to the other side of the Channel. I would query whether we are happy about that. As we know, magistrates do not even always impose the highest fines. Quite often, smaller fines are imposed. I am glad that the Under-Secretary of State in the other place was able to accept that, in the matter of vehicles going out of ports, the examiners would be sufficient to deal with these vehicles and the police need not be involved. This was a wise measure, and we are all grateful to the Government for having agreed to this point.
Because I thought that this Bill would be coming on later, I had to refuse an invitation from the Freight Transport Association to be their guest at their annual dinner tonight. Little did I think that this was going to whiz through so quickly after our earlier business and I could have told them how happily the affair had gone. Having said that we want as many permits as possible, I think that the strengthening of our laws will help. I do not think that there is need for me to say any more, except to thank

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the noble Lord, Lord Champion, again and give the Bill a welcome from these Benches.
4.3 p.m.
Lord MELCHETT: My Lords, may I first add my thanks to my noble friend Lord Champion for introducing this Bill in your Lordships' House. I am sure that both he and I are desolate that it should have caused the noble Lord, Lord Mowbray and Stourton, to have missed a dinner tonight. No doubt other terrible things have happened to him, but I am sure that this small Bill is entirely innocent of causing such a desperate state of affairs. My noble friend has enormous experience in the transport field and I, like the noble Lord, Lord Mowbray and Stourton, do not think that I can add a great deal to what he has said about it. The Government have been concerned at the development of the practice among some British road hauliers of using forged permits. We have evidence that this practice has spread fairly widely in recent months. This is damaging to the good reputation of the haulage industry and harmful to the interests of honest operators, and it causes serious problems in our negotiations with foreign countries for larger quotas. It is argued that it is vital that all possible steps should be taken to stamp out these abuses. We therefore welcome this Bill, which will provide a very useful weapon in the Government's armoury.
As has already been indicated in another place, the Government feel that the Bill needs strengthening to deal with cases in which, despite the provisions in Clause 1 relating to fines, vehicles might still be taken overseas under cover of forged permits. Discussions with haulage associations are currently in progress, and arising from these the Government intend to put down suitable Amendments in Committee. With this minor qualification, I also give this Bill my support and commend it to your Lordships.
Lord CHAMPION: My Lords, I am grateful to the noble Lord, Lord Mowbray and Stourton, for the welcome that he has given to this Bill. So far as my noble friend is concerned, I would have been shocked if he had not welcomed it, considering that his Department had something to do with it. The noble Lord, Lord Mowbray, addressed some
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questions to me about the penalty, and I must admit that I have some little sympathy with him on this score. However, the fact is that the level of penalty conforms with that provided for in Section 65 of the Transport Act 1968 in relation to the use of a vehicle without an operator's licence. It was thought that this penalty should also apply here, but agree with him that in many cases the value of the goods being transported and so on, and the value to the road haulier of the traffic in which he is engaged, may be such that the penalty is inadequate. But it will not be for me to introduce an Amendment to increase that amount of £200, because clearly it would also necessitate an amendment to the Transport Act 1968.
The second point was on the £100 penalty, which is less than the £200 for the obvious reason that this will apply to the driver of the vehicle—not the operator himself. This, too, is based on previous legislation, and I fear will not be altered or amended by this Bill going though this House. The noble Lord. Lord Melchett, said that despite the provisions of Clause 1 there is still a weakness in the Bill, and unless it is strengthened it might still be possible to take vehicles overseas under the cover of forged permits. If that is so, the Bill as at present drafted has very little value and I am sure that the House will welcome the promised Amendments. We have not taken very much time over this small Bill, but I believe that it is an important one and I hope that its further progress in this House will be facilitated in Committee and further stages.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

MERSEYSIDE METROPOLITAN RAILWAY BILL
The Queen's consent signified, and Bill reported with Amendments.
WESTMINSTER ABBEY BILL [H.L.]
Report from Her Majesty's Attorney General received, and ordered to lie on the Table.
  LONDON BOROUGH VACANT DWELLINGS
  LONDON BOROUGH VACANT DWELLINGS
  HUMANE SLAUGHTER: AMMUNITION SUPPLIES
  HUMANE SLAUGHTER: AMMUNITION SUPPLIES